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Report No. 89

32.21. Starting point of limitati.-Goods delivered from time to time.- A question that needs to be considered is what should be the starting point for limitation under Article 14, when the goods are delivered at different times? The view of the Madras High Court1 is that when goods are supplied from time to time and the payment is also made from time to time, Article 52 of the Limitation Act, 1908 (corresponding to Article 14 of the present Act) would apply after the payments are appropriated under sections 60 and 61 of the Indian Contract Act, 1877. The result would be, that if the date corresponding to the delivery that is unadjusted falls beyond three years from the date of institution of the suit, the claim would be time-barred.

The Rajasthan High Court2 has, on the other hand, regarded a payment in such case of goods sold at different dates as "payment" within the meaning of section 20 of the Limitation Act, 1908 (section 19 of the present Act), so as to give a fresh period of limitation to the items which are not berried by limitation on the date of that payment. The Kerala High Court3 has held that even though some payments by cheque were made by the defendant towards the price of goods supplied from time to time on account, such a payment cannot be construed as amounting to an acknowledgement of the debt under section 19 of the LiMitation Act, 1963.

1. Md. Sultan & Co. v. Manickarn, AIR 1961 Mad 388.

2. Chandra Nath v. Prahlad Narain, AIR 1961 Raj 154.

3. Charunni v. Purushothanta, AIR 1973 Ker 174.

31.22. No change needed.- The manner in which payments are to be applied by the creditor has been codified in sections 59 to 61 of the Contract Act. The applicability of Article 14 to such a situation would primarily depend upon the facts of each case, and on the mode of agreement between the purchaser and the seller. Consequently, no amendment of the article is called for, to deal specifically with cases of delivery of goods from tune to time.

32.23. Articles 15-16.- (a) Article 15 reads as unde.-

"For the price of goods sold and delivered to be paid for after the expiry of a fixed period of credit.

Three years.

When the period of credit expires."

It is identical with Article 53 of the Acts of 1908 and 1877. In the Act of 1871, Article 52 was in the same terms but the starting point w.-"The expiry of the period of credit".

(b) Article 16 reads as unde.-

"For the price of goods sold and delivered to be paid for by a bill of exchange, no such bill being given.

Three years.

When the period of the proposed bill elapses."

It is identical with Article 54 of the Acts of 1908 and 1877, and with Article 53 of the Act of 1871.

The recommendation of the Law Commission1 in its Report on the Act of 1908, to consolidate Articles 51 to 54 of the Act 1908, has not been accepted.

(c) On a consideration of the articles and the cases thereon we do not consider it necessary to recommend any change.

1. Law Commission of India, 3rd Report (Limitation Act, 1908), para. 74

32.24. Article 17.- Article 17 reads as unde.-

"For the trees or growing crops sold by the plaintiff to the defendant where no fixed period of credit is agreed upon.

Three years.

The date of the sale."

It is identical with Article 55 of the Acts of 1908 and 1877, and with Article 54 of the Act of 1871.

The article needs no change.

32.25. Article 18.- Article 18 reads as unde.-

"For the price of word done by the plaintiff for the defendant at his request where no time has been fixed for payment.

Three years.

When the work is done."

It is identical with Article 56 of the Acts of 1908 and 1877, and with Article 55 of the Act of 1871.

32.26. Article 10 and Government contracts.- The Patna High Court1 has held that when a contractor executes a work for the Government under a contract which is finalised after the invitation of tenders, it cannot be said that the work was done at the "request of the Government" (Article 56 of the Act of 1908). Hence, the case is outside Article 56, and is governed by the residuary article (Article 120 of the Act of 1908, now Article 113).

A contrary view has been taken by the Andhra High Court,2 which has held that such a suit is one for claiming price for work done and not "for compensation for breach of any contract". A similar view has been taken by a Full Bench of the Allahabad High Court.3

Now that the period of Limitation under Article 120 of the 1908 Act (residuary article) has been reduced to three years in Article 113 of the 1963 Act, the plaintiff is not likely to get any advantage whether Article 18 or Article 113 applies to the facts of his case.

Consequently, no change is recommended in Article 18.

1. State of Bihar v. Rama Bhushan, AIR 1964 Pat 326.

2. Subbarafti v. Village Panchayat, AIR 1965 AP 186.

3. Zila Parishad v. Shanti Devi, AIR 1965 All 590 (FB).

32.27. Article 19.- Article 19 reads as unde.-

"For money payable for money lent.

Three years.

When the loan is made."

The article is identical with Article 57 of the Acts of 1908 and 1877 and with Article 56 of the Act of 1871.

The article needs no change.

32.28. Article 20.- Article 20 reads as unde.-

"Like suit when the lender has given a cheque for the money.

Three years.

When the cheque is paid."

It is identical with Article 58 of the Acts of 1908 and 1877, and with Article 57 of the Act of 1871. No change is needed in this article.

32.29. Article 21.- Article 21 reads as unde.-

"For money lent under an agreement that it shall be payable on demand.

Three years.

When the loan is made."

It is identical with Article 59 of the Acts of 1908 and 1877. Article 58 of the Act of 1871 reads as unde.-

"For money lent under an agreement that it shall be payable on demand.

Three years.

When the demand is made."

No change is needed in the article.

32.30. Article 22.- Article 22 reads as unde.-

"For money deposited under an agreement that it shall be payable on demand, including money of a customer in the hands of his banker so payable.

Three years.

When the demand is made."

It is identical with Article 60 of the Act of 1908.

Article 60 of the Act of 1877 was as unde.-

"For money deposited under an agreement that it shall be payable on demand.

Three years.

When the demand is made."

There was no corresponding provision in the Act of 1871.



The Limitation Act, 1963 Back




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