Report No. 193
The general principle was also stated by Bachawat J in Dickie & Co v. Municipal Board, (AIR 1956 Cal 216 at 219) as follows:
"It is well settled that so much of the law as affects the remedy and the procedure only is governed by the law of the country in which the action is brought and not by foreign law. The Court will not apply a foreign law of limitation which affects the remedy only and is therefore a matter of mere procedure. The foreign law of limitation will be applied where it extinguishes the right or creates the title so that it ceases to be a matter of mere procedure. Sec. 11 of the Act is a plain recognition of this principle."
It will be seen that section 11 applies only to foreign contracts. But this principle must be extended to all obligations or substantive rights arising in a foreign country with reference to which suits are filed in India. Prof. Venkataraman says that Dr. Stokes in his Anglo-Indian Codes, Vol II page 950 suggested that section 11 should be expressly extended to all obligations. Where the remedy only is barred by a foreign law of limitation, a suit may be instituted in India provided it is not barred by the Indian law (Nalla Thambi v. Ponnuswami, (1879) ILR 2 Mad 400; Harris v. Quine, (1869) LR 4 QB 653. That will be the position even after the proposed change, namely, that the foreign law of limitation would apply in India in respect of the period.
There is one other aspect which we have to refer in the matter of applicability of foreign law of limitation. It will be seen that in the Australian, New Zealand and UK statutes, it is said that in the matter of exercising discretion while applying the foreign law of limitation, the law of that country would be applicable. For example, in the Indian Act of 1963, there are ss. 4 to 24 in some of which there is provision for Court passing orders in excluding certain periods - see for example section 14, where the period spent in filing the suit in a wrong Court has to be excluded if that Court was approached bona fide and in good faith. We also have provision where minors are given extended period of time. Sec. 12 deals with exclusion of time taken in obtaining certified copies of judgments etc.
We are not in favour of applying rules of the foreign law which correspond to sections 4 to 24 of the Indian law. That would be compelling Indian Courts to identify various other provisions of the law of limitation or procedure in a number of countries. We, therefore, recommend that all that applies is the foreign period of limitation together with any declaration in that law that it is substantive or that the right does or does not get extinguished. The foreign period applies whether it is shorter or longer. But if a question corresponding to ss. 4 to 24 arises, the provisions of ss. 4 to 24 of the Indian Act apply.
As regards execution of foreign decrees, section 11 did not refer to the aspect expressly but Courts have held that the same principle which applies to suits should be applicable to execution proceedings, i.e. Indian procedural law, including Indian Limitation Act, will apply. In Dickie & Co, above referred to, the Calcutta High Court said: "section 11 of the Limitation Act is, however, not exhaustive. Thus it was held in Nabibhati Vazirbhai v. Dayabhai Amulukh, AIR 1916 Bom p.200, a decree passed by the Native State of Baroda could not be executed in India because the application for execution was barred by the Indian Law of Limitation although it was clearly not barred by the law of limitation of Baroda State".
To a like effect is the principle laid down in Srinivasa v. Narayana, AIR 1923 Mad 72 and Hukumchand Aswal v. Gyanendar, (1887) ILR 6 Cal 570. It was laid down in these cases that the law of limitation for the execution of a decree transferred to an Indian Court for execution is that law which prevails in the latter Court. But the legislature may expressly enact that a foreign rule of limitation shall be applicable to particular suits, although such rule has not extinguished the substantive right. For instance, see section 8 of Act XII of 1886, relating to the cession of Jhansi. (Prof. Venkataraman in U.N. Mitra's Commentary, ibid, p.132)
So far as the execution of foreign decrees is concerned, there being no specific article in the Schedule to Limitation Act, 1963, there has been conflict of decisions. A Full Bench of the Madras High Court in Sheik Ali v. Sheik Mohammed, AIR 1967 Mad 45 (FB) took the view that Article 182 applies only to execution of decrees passed by Courts in India and that hence the residuary Article 181 applies.
It further held that under the third column, the starting point is the date on which the 'right to apply accrues' and it held that time commences from the date on which a certified copy of 53the foreign decree is filed in the District Court in India. However, the Punjab and Haryana High Court in Lakhpat Rai Sharma v. Atma Singh, AIR 1971 Punjab & Haryana 476 held that Article 182 which applies to execution of decree also applies to execution of foreign decrees.
Instead of leaving the matters indefinite, we are of the view that some provisions are required to be made. Firstly the 'foreign country' here must be a 'reciprocating country' under section 44A of the CPC. Only then is a foreign decree executable in India. Of course, section 44A of CPC does not apply to decrees passed in the State of Jammu and Kashmir. The decrees passed in that State can be executed in other parts of India as per section 43.
Hitherto under the 1963 Act, limitation law being procedural, the Indian Act was applied in regard to execution of decrees of foreign courts, the only dispute was whether Article 181 or 182 of the 1908 Act (now 137, 136 of the 1963 Act) would apply. Now that we are proposing under the new section 11 that the foreign period of limitation will apply to suits, this principle must also be reflected in the proposed amendments in respect of execution of foreign decrees. This is reflected in section 11A as proposed.
We have examined the question whether the period for execution of a domestic decree as prescribed in the foreign law should apply or whether the period for execution of a foreign decree as prescribed in the foreign law should apply. It is possible that in some countries, as in ours, there is no specific article dealing with execution of foreign decrees. In order to avoid uncertainty, we are of the view that the period for execution of a foreign decree in Indian Courts must be the period fixed in the foreign country for execution of its domestic decrees.
Now that a certified copy thereof will be filed in the Indian District Court under section 44A of the Code of Civil Procedure, 1908, the time for commencement, in our view, should be the date on which the certified copy of the foreign decree is filed here. As the proposed section 11A applies, principles stated in proposed section 11 apply. As section 11(2) as proposed uses the words 'subject to the provision of this Act', it is obvious that for purposes of proposed Article 136A, ss. 4 to 24 of the Act shall also apply. The following provisions are proposed for the new section 11A.
The proposed section 11A will relate to the execution in India in the Courts to which the Act extends, of decrees passed in foreign countries which are 'reciprocating countries' as stated in the Explanation below section 44A of the Code of Civil Procedure, 1908. (Sec. 11A does not deal with execution of decrees passed by Court in Jammu and Kashmir, in the Courts in other parts of India for the law is settled by judicial decisions that section 43 CPC applies). In respect of such decrees passed in reciprocating foreign countries, which are sought to be executed in the Court to which the Act extends, in view of proposed section 11A, the principle of limitation stated in section 11 shall apply, namely, period of limitation and the principle of extinguishment of rights as may be stated in the law of limitation of the said foreign country.
Further, the period of limitation of the foreign law that applies for execution in such Indian Courts as stated above, will be the period prescribed by the foreign law for execution of the decrees passed by its domestic Courts. The commencement of the period will be from the date of filing a certified copy of the decree of the foreign Court in the Indian Court as stated in section 44A of the Code of Civil Procedure, 1908. By virtue of section 11A attracting the principles of the proposed section 11, the provisions 55of sections 4 to 24 shall also apply to such applications for execution filed in India.
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