Monotosh Kumar Mitra Vs. Amarendranath Shaw Ors [2000] INSC 73 (17 February 2000)
S.S.Ahamad,
Y.K.Sabharwal
L.I.T.J
SABHARWAL J.
In a
mortgage suit, a preliminary decree was passed in favour of the appellant on 18th November, 1968. The said decree directed the
payment of the sum of Rs.24,000/- in four equal instalments. The first instalment
was payable on or before 31st
March, 1969 and
subsequent instalments by 31st day of March of each succeeding years. Thus the
last instalment was payable on 31st March, 1972.
The decree further stipulated that in case of default of payment of any one of
the instalments, the plaintiff may, subject to the provisions of Bengal Money
Lenders' Act, 1960 (for short, Bengal Act), apply to the Court for a final
decree for sale of the mortgaged property and on such application being
granted, the mortgaged property or a sufficient part thereof shall be directed
to be sold.
It has
not been questioned that neither the first instalment payable under the decree
on or before 31st
March, 1969, was paid
by the defendants nor was any subsequent instalment paid.
Order
34 Rule 2 of Code of Civil Procedure inter alia stipulates grant of six months'
time to the defendant to pay the mortgage amount stipulated under the
preliminary decree and on default of payment, the plaintiff is entitled to
apply for final decree directing sale of the mortgaged property as stipulated
by Rule 4 of Order 34. Section 34 of Bengal Act, however, empowers the Court to
direct payments by instalments notwithstanding the limit of six months fixed in
Order 34 of Code of Civil Procedure. Section 34 of the Bengal Act reads as under
:- "34. Power of Court to direct payment by instalments -- (1)
Notwithstanding anything contained in any law for the time being in force, or
in any agreement, the Court shall -- (a) in suits in respect of loans to which
the provisions of Order XXXIV of the First Schedule to the Code of Civil
Procedure, 1908, apply, on the application of the defendant and after hearing
the plaintiff, notwithstanding the limit of six months provided herein, direct
at the time of the passing of the preliminary decree under rule 2 or rule 4 of
the said Order to the effect mentioned in sub-clause (i) of clause (c) of
sub-rule (1) of the said rule 2,- (i) that the payment of the amount found or
declared due under sub-rule (1) of rule 2 or sub-rule (1) of rule 4 of the said
Order, as the case may be, is to be made, subject to such conditions as the
Court may impose in such number of annual instalments and on such dates as the
Court thinks fit having regard to the circumstances of the plaintiff and the
defendant and the amount of the decree;
and
(ii) that in default of payment of any such instalment the plaintiff shall, after
giving to the defendant such notice as may be prescribed, be entitled to apply
for a final decree under sub-clause (ii) of clause (c) of sub-rule (1) of the
said rule 2 or under sub-rule (1) of the said rule 4, as the case may be, and
the date of such default shall be deemed to be the date fixed under sub-clause
(I) of clause (c) of sub- rule (1) of the said rule 2 for payment of the whole
amount fund or declared due under or by the preliminary decree :
Provided
that nothing in this clause shall affect the power of the Court to allow
extension of time under sub-rule (2) of rule 2 or sub-rule (2) of rule 4 of the
said Order :
Provided
further that if the defendant, after receiving the notice referred to in
sub-clause (ii) and before a final decree is passed, makes payment into Court
of the amount due from him in respect of any such instalment, the payment of
such instalment shall not be deemed to be in default and the Court shall not
pass a final decree;
(b) in
suits in respect of loans advanced before the commencement of this Act other
than those referred to in clause (a) -- (i) on the application of a defendant
and after hearing the plaintiff, order at the time of the passing of the
decree, or (ii) on the application of a judgment-debtor against whom a decree
in such suit has been passed whether before or after the commencement of this
Act and after notice tot he decree- holder, order at any time after the decree
has been passed, that the amount of the decree shall, subject to such
conditions as the Court may impose, be payable without interest in such number
of annual instalments, on such dates and within such period not exceeding
twenty years as the Court thinks fit having regard to the circumstances of the
plaintiff and the defendant or the decree-holder and the judgment-debtor and
the amount of the decree, and that, if default is made in making payment of any
instalment, that instalment and not the whole of the decretal amount shall be
recoverable;
(c) during
the pendency of any enquiry under sub-clause (ii) of clause (b) order, subject
to such conditions as the Court may impose, the stay of execution of the
decree.
(2) In
default of payment of any instalment referred to in clause (b) of sub-section
(1), the decree-holder shall, after giving to the judgment-debtor such notice
as may be prescribed, be entitled to apply for execution of the decree in
respect of such instalment together with interest thereon at the rate of not
more than six per centum per annum from the date of such default:
Provided
that nothing in this sub-section shall affect the power of the Court to allow,
prior to an order for execution of the decree, an extension of time of not less
than one year for the payment of any instalment, and if such extension of time
is allowed, the payment of such instalment shall not be deemed to be in
default:
Provided
further that if the judgment- debtor, after receiving the notice referred to in
this sub-section and prior to an order for execution of the decree, makes
payment into Court of the amount due from him in respect of any such instalment,
the payment of such instalment shall not be deemed to be in default and the
Court shall not order execution of the decree.
(3) Any
order made under sub-clause (ii) of clause (b) of sub-section (1) shall be
deemed to have been passed under section 47 of the Code of Civil Procedure,
1908." On failure of the defendants to pay any instalments, the appellant
served on them notice under the aforesaid provision stating that the defendants
had defaulted in payment of all the instalments in terms of the decree, an
application will be made in the High Court of Calcutta within 30 days for final
decree for sale of the property.
The
defendants having still failed to make any payment, an application for passing
final decree was filed by the appellant in the High Court on or about 15th
February, 1973.
The
said application was dismissed by the learned Single Judge as time barred and
the appeal having been dismissed by the Division Bench, the present appeal has
been preferred by the plaintiff.
An
application for passing of the final decree is governed by Residuary Article
137 of the Limitation
Act, 1963,
under which application for passing of final decree has to be filed within
three years from the date when the right to apply accrues. If the right to
apply for final decree had accrued to the plaintiff on default being committed
by the defendants in payment of the first instalment itself on 31st March, 1969, the application for passing of
final decree would be required to be filed within three years from the date of
default. Not disputing that the default was committed by defendants in payment
of the first instalment, learned counsel for the appellant contends that
default committed in each subsequent year in payment of instalment gives rise
to a fresh cause of action to apply for passing of final decree and, therefore,
such an application having been filed on 15th February, 1973, would not be time
barred at least in respect of the instalments which were payable under the
decree on 31st March 1970, 1971 and 1972. It is further contended that the
application may be time barred, at best, in relation to default committed by
defendants for payment of the first instalment payable on or before 31st March, 1969.
It is
evident from Section 34 of the Bengal Act that in default of payment of any instalment,
the date of such default shall be deemed to be date fixed under sub-clause (i)
of clause (c) of Sub- Rule (1) of Rule 2 for payment of the whole amount. The
whole amount found or declared due under or by a preliminary decree becomes
payable and the plaintiff becomes entitled to apply for a final decree [Section
34(1)(a)(ii) of the Bengal Act]. It is thus clear that notwithstanding the
dates of the instalments having been fixed under the preliminary decree which
was subject to the provisions of the Bengal Act, a right accrued to the
appellant to apply for final decree on default having been committed by the
defendants in payment of the amount of the first instalment. It is not a case
of a simple money decree. It is a case of a mortgage where under the
preliminary decree, an opportunity is granted to the defendants to pay the
mortgage amount in default whereof the plaintiff becomes entitled to apply for
a final decree for sale of the mortgaged property. That right accrued to the
plaintiff in this case on 31st March, 1969.
The plaintiff cannot extend the period of limitation by delaying service of
notice on defendant under Section 34 of the Bengal Act, which is a
pre-condition for making of an application by plaintiff for passing of final
decree. The period of limitation would start running from the time the right to
apply for final decree accrues and is not dependent on the date of sending of
notice by the plaintiff to the defendant as required under the Bengal Act. In Nalini
Kanto Bhattacharjee v. Mohan Chand Biswas (AIR 1960 Cal. 477), a Division Bench
of Calcutta High Court rightly held that the starting point of limitation for
making an application for final decree was the date when the first default was
made and as the application was made more than three years after from the date
of the first default, it was barred by limitation. It also held that though the
giving of notice prescribed by Section 34 of Bengal Act is a condition
precedent to the making of application for final decree, the fact of giving of
the prescribed notice had not the effect of arresting the running of normal
period of limitation or enlarging the period of limitation and further upon
default being made in payment of any instalment, the whole of the amount
payable under the decree becomes due on the date of such default and right to
apply, therefore, accrues once and for all on the date of the default. It may
also be noted that the notice under Section 34 sent by the appellant was based
on all the four defaults committed by the defendants and it was not stated that
any default was waived or condoned. In this view, we need not go into the
question whether in law plaintiff could at all waive or condone the default for
the purposes of the Limitation Act.
Rightly relying upon the aforesaid decision, the application of the appellant
for passing of the final decree was dismissed by the High Court. We find no
infirmity in the impugned judgment.
For
the aforesaid reasons, the appeal is dismissed.
Parties
are, however, left to bear their own costs.
Back