Report No. 3
16. Effect of fraud or mistake.-
(1) Where in the case of any suit or application for which a period of limitation prescribed by this Act, either-
(a) the suit or application is based upon the fraud of the defendant or his agent or of any person through whom he claims or his agent; or
(b) the knowledge of the right or title on which a suit or application is founded is concealed by the fraud of any such person as aforesaid; or
(c) the suit or application is for relief from the consequences of a mistake; or
(d) where any document necessary to establish plaintiff's or applicant's right has been fraudulently concealed from him;
the period of limitation shall not begin to run until the plaintiff or applicant has discovered the fraud or the mistake, at the case may be, or could with reasonable diligence have discovered it, or in the case of the concealed document, when he first had the means of producing it or compelling its production.
Provided that nothing in this section shall enable any suit to be brought or application to be made to recover, or enforce any charge against, or set aside any transaction affecting, any property which?
(i) in the case of fraud, has been purchased for valuable consideration by a person who was not a party to the fraud and did not at the time of the purchase know or have reason to believe that any fraud had been committed, or
(ii) in the case of mistake, has been purchased for valuable consideration, subsequent to the transaction in which the mistake was made, by a person who did not know or have reason to believe the mistake had been made, or
(iii) in the case of the concealed document, has been purchased for valuable consideration by a person who was not a party to the concealment, and did not at the time of the purchase know or have reason to believe such concealment;
(2) The Court may extend the period prescribed for an application for execution of a decree or order, upon such application presented after the expiry of the said period, if the judgment-debtor has by fraud or force, prevented the execution of the decree or order at some time within the said period:
Provided that such application is made within a period of one year from the date of discovery of fraud or of the cessation of force, as the case may be.