M/S. Disha
Constructions & Ors. Vs. State of Goa & ANR.
[Civil Appeal
No.10763 Of 2011 Arising out of Special Leave Petition (Civil) No. 1352 of 2011]
JUDGMENT
GANGULY, J.
1.
Heard
learned counsel for the parties.
2.
Leave
granted.
3.
A
suit was filed by the appellants praying for payment of money which according
to the appellants was due to them for undertaking the construction work on behalf
of the defendants. The suit was dismissed by a judgment and order dated 12th November,
2009 by the District Judge, North Goa, Panaji, inter alia, holding that the
plaint cannot be registered as it was barred by limitation as also in view of the
fact that there was no compliance with Section 80 of the Civil Procedure Code
insofar as notice on defendant No. 2 is concerned.
4.
On
an appeal before the High Court, the High Court was pleased to hold that the suit
is barred by limitation but on the question of notice, the High Court came to a
different finding and came to the conclusion that notice was served. The material
facts of the case are as follows:
5.
The
appellants-plaintiffs entered into an agreement with respondent No. 1 for
construction of a school auditorium for Fr. Agnelo High School under M.P.
L.A.D. scheme. On completion of the work on 30th September, 2006 defendant No.
2 issued a certificate of completion dated 3rd October, 2006.
Out of the total
amount of Rs.24,26,000/- the appellants plaintiffs were paid only Rs.18,12,000/-
and therefore, there was a balance amount to be paid. The appellants plaintiffs
prayed for the payment of the balance amount but it was denied and the same
remained unpaid from 30th September, 2006 and a suit was filed on 24th October,
2009 for recovery of a sum of Rs.9,15,550/- with interest at 18%.
6.
The
first question, which was examined by the High Court, was whether notice under Section
80, CPC was required to be given to defendant No. 2? The High Court came to the
conclusion that such notice was necessary. The High Court observed as follows: "Since
the suit was filed by the plaintiffs against defendant No. 2 in his official capacity,
in my opinion, the defendant No. 2 was certainly required to be given a notice,
as required under Section 80 of the Civil Procedure Code and in absence of the
same, the suit filed against him had to be necessarily considered as bad in law
for want of notice.
However, that cannot
be said to be fatal to the entire case of the plaintiff because the plaintiff's
suit was essentially for recovery of money and as could be seen from the prayer
clause (a) it was filed against defendant No.1. A similar view was held by the
Apex Court in Ram Kumar Vs. State of Rajasthan, AIR 2008 (10) SCC 73."
7.
It
is a common ground that High Court correctly noted the relevant facts, which
are as under: "...according to the plaintiff, the cause of action had arisen,
as pleaded by the plaintiff, on 30/09/2006 and being so, the suit against
defendant No. 1 had to be filed before 30/9/2009 that is to say before the expiry
of three years, that being the period prescribed, for filing a suit for recovery
of money.
There is no dispute
that the suit was in fact filed on 24/10/2009. There is also no dispute that
the plaintiff had sent notice to defendant No. 1 on 19/02/2009 which was received
by defendant No. 1 on 27/02/2009. If two months are computed from 27/02/2009, the
plaitiffs were required to file the suit on 27/04/2009."
8.
Upon
setting out the aforesaid fact, the High Court has noted that the notice under Section
80 was served on Defendant No. 1 on 27th February, 2009 and the period of two months
had expired on 27th April, 2009. According to the High Court, the period of
limitation expired on 30th September, 2009 and therefore, the suit which was filed
on 24th October, 2009, was barred by limitation.
9.
Assailing
the aforesaid finding, learned counsel for the appellants has drawn our notice to
the provision of Section 15(2) of the Limitation Act which is contained under
Part III of the Limitation Act, 1963 (hereinafter referred to as 'the Act'). Part
III is under the heading "Computation of period of limitation" and
Section 15 deals with "Exclusion of time in certain other cases".
Sections 12, 13 and 14
also deal with exclusion of time in different situations such as
"Exclusion of time in legal proceedings", "Exclusion of time in
cases where leave to sue or appeal as a pauper is applied for" and "Exclusion
of time of proceeding bona fide in Court without jurisdiction"
respectively.
10.
Section
15(2) which is relevant for our consideration deals with exclusion of time which
is required to be given for a notice and there is also an explanation which is
appended to Section 15. The said Section 15(2) reads as follows: 15. Exclusion of
time in certain other cases.-- (1) ... (2) In computign the period of limitation
for any suit of which notice has been given, or for which the previous consent or
sanction of the Government or any other authority is required, in accordance with
the requirements of any law for the time being in force, the period of such notice
or, as the case may be, the time required for obtaining such consent or
sanction shall be excluded. 5 Explanation.-
In excluding the time
required for obtaining the consent or sanction of the Government or any other
authority, the date on which the application was made for obtaining the consent
or sanction and the date of receipt of the order of the Government or other
authority shall both be counted.
11.
It
may be noted that the present Section 15(2) is a little more comprehensive than
the previous Section 15(2) of the Limitation Act, 1908 which reads as follows: 15.Exclusion
of time during which proceedings are suspended.- (1) ... (2) In computing the period
of limitation prescribed for any suit of which notice has been given in accordance
with the requirements of any enactment for the time being in force, the period of
such notice shall be excluded.
12.
We
are of the view that in the facts and circumstances of this case, the notice under
Section 80 was admittedly given on 19th February, 2009 which is within the period
of limitation and the same was received on 27th February, 2009 and two months
from the date of receipt expired on 27th April, 2009.
13.
The
High Court has held, in our view erroneously, that since the suit was filed on 24th
October, 2009, which is beyond 30th September, 2009, the plaintiffs appellants are
not entitled to the benefit of exclusion statutorily provided under Section
15(2) of the Act and the suit is barred by limitation.
14.
The
said interpretation of the High Court is erroneous in view of the fact that if
the notice under Section 80 had been given, say, on 29th September, 2009, in that
case the appellants according to High Court's interpretation, would have been given
the benefit of exclusion of time after 30th September, 2009. Just because the appellants
gave the notice before the expiry of the period of limitation, the benefit
which is given under Section 15(2) of the Act cannot be taken away.
We are of the view
that the said period of two months must be computed and benefit of exclusion of
the said two months must be given to the appellants even if they had given the said
notice within the period of limitation. If the appellants had given the notice after
the expiry of period of limitation, say, after 30th September, 2009, then
possibly they could not have been given the benefit.
In this connection, we
may refer to the decision of this Court in Union of India & Ors. Vs. West Coast
Paper Mills Ltd. & Anr. (2004) 3 SCC 458, where in a somewhat similar situation,
this Court has held as follows: "Any circumstance, legal or factual, which
inhibits entertainment or consideration by the Court of the dispute on the merits
comes within the scope of the Section and a liberal touch must inform the interpretation
of the Limitation Act which deprives the remedy of one who has a right".
15.
We
are in respectful agreement with the aforesaid principles laid down by this Court
though in the context of considering Section 14 of the Limitation Act. We are
of the view that the same principles should be applied while considering the provision
of Section 15(2) of the Limitation Act. The statutory provision in this connection
is very clear and in the definition clause also it has been made clear in
Section 2(j) of the Act.
Under Section 2(j) of
the Act, the "period of limitation" means the period prescribed for any
suit, or other proceeding by the Schedule and the "prescribed period"
means the period of limitation computed in accordance with the provisions of
the Act. If we follow the aforesaid principles, as we must, we find that the
erroneous interpretation which has been given by the High Court will have the effect
of denying the appellants the benefit of Section 15(2) which is not permissible
in the eye of law.
16.
In
our view, proper interpretation of Section 15(2) of the Act would be that in computing
the period of limitation, the period of notice, provided notice is given within
the limitation period, would be mandatorily excluded. That would mean a suit,
for which period of limitation is three years, would be within limitation even
if it is filed within two months after three years, provided notice has been
given within the 8limitation period.
In such a case, the
period of notice cannot be counted concurrently with the period of limitation.
If it is done, then period of notice is not excluded. Any other interpretation
would be contrary to the express mandate of Section 15(2) of the Act.
17.
We,
therefore, set aside the order of the High Court and we hold that the suit is
within the period of limitation. Since, on the question of notice, the finding of
the trial Court has been overruled by the High Court and the High Court has
held that the notice has been served on defendant No. 1 and against such
finding there is no cross objection, we are of the view that the notice in this
case has been served.
18.
Therefore,
we direct that the suit may be heard out now on merits by the trial Court as early
as possible. We, however, do not make any observation on the merits of the
controversy between the parties.
19.
The
appeal is accordingly allowed. No costs.
.............................J.
(ASOK KUMAR GANGULY)
.............................J.
(JAGDISH SINGH KHEHAR)
NEW
DELHI,
December
09, 2011
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