Report No. 193
Prospective operation:
We further recommend that the provision of ss. 11 and 11A and Article 136A shall apply only in relation to causes of action arising after the commencement of the proposed amendment Act. Hence, the new proposals will not apply to pending proceedings or even to causes of action which have already arisen before the commencement of the amending Act. Summarising the recommendations, the position is as follows:
(1) The provision in section11 of the 1963 Act is confined to contracts entered into in a foreign country but does extend to other matters like torts etc. As pointed above, the proposed section must deal with the applicability of the foreign law of limitation as regards rights and obligations arising out of contracts entered into in the foreign country or in respect of any other kind of legal rights and obligations arising in the foreign country. The same will be the position in respect of such rights and obligations in respect of J & K.
(2) The existing provision in the 1963 Act, namely, section 11 does not conform to the changes made in the statutes in other common law countries and, in view of the latest trends in other countries, the proposed section 11 must apply the law of limitation of the foreign country, treating it as substantive law. In that case whether the right gets extinguished there or whether the period under the 56foreign law is larger or shorter than the corresponding period in India, the foreign period will apply. If the foreign law states that the right is extinguished after the period, Indian Courts will refuse relief.
(3) The condition in section 11(2)(b) that the parties must have been domiciled in the foreign country during the relevant period, must be deleted.
(4) So far as the provision of ss. 4 to 24 of the Indian Limitation are concerned, we are of the view that those sections must continue to apply to suits filed on the basis of obligations arising abroad and the only thing that applies from the foreign law is the period prescribed thereon or the declaration that the right is extinguished. In the matter of applicability of ss. 4 to 24 of the Indian Act, 1963, the Indian law will apply. Here, we have deviated from the UK Act of 1984 as well as the Australian enactments. The reason is that otherwise, Indian Courts will have to delve into the various other provisions of the foreign law relating to the manner in which discretion has to be exercised. Sec. 11 will apply to cause of action arising in the State of Jammu and Kashmir and in regard to which suits are filed in India, outside Jammu and Kashmir.
(5) So far as execution of foreign decrees is concerned, there is no need to disturb the present state of case law that for execution of decrees passed in the State of Jammu & Kashmir in Courts in other parts of India, section 43 of CPC applies. In respect of decrees passed in foreign countries referred to in the Explanation to section 44A of the Code of Civil Procedure, 1908 (called reciprocating countries), the period for execution of such foreign decrees shall be the period as stated in the foreign law, for execution of the decrees passed in the Courts in that country, i.e. domestic decrees.
That period will be applicable for execution of foreign decrees in the Courts in India to which the Indian Act of 1963 extends. The commencement of the period shall be the date on which a certified copy of the decree of the foreign Court in the reciprocating foreign country is filed in the District Court in India as stated in section 44A of the Code of Civil Procedure, 1908. The computation of the period shall be in accordance with the provisions of ss. 4 to 24.
(6) It is also proposed that the period of limitation in the State of Jammu and Kashmir or a foreign country that is applicable in India will be for the purpose of the institution of suits in the Courts to which the 1963 Act extends and not for purposes of further proceedings arising therefrom. Likewise, the proposal for applying the foreign period for execution of foreign decrees in India is only for purposes of filing an application for execution in such Indian Courts and not for purpose of the further proceedings arising therefrom.
(7) The proposed changes will be prospective in operation in the sense that they will apply only to causes of action arising after the date of commencement of the proposed legislation. That would mean that the proposed changes will not apply to pending proceedings or to causes of action that have not arisen. This is so far as suits 58to be filed in the Courts in India to which the 1963 Act applies, which are based on foreign causes of action as provided in new section 11.
(8) So far as the execution of decrees of Courts of a foreign country is concerned, execution application filed for that purpose in Indians courts under the 1963 Act, the proposed provisions in sections11A and Article 136A, shall not apply to applications for execution of foreign decrees, which were passed before the commencement of the proposed amending Act.
We recommend accordingly.
In order to concretize our recommendations in legislative form, a Draft Bill, namely, Limitation (Amendment) Bill, 2005, is appended as Annexure I to this Report. We place on record the valuable assistance rendered by Dr. S. Muralidhar, Part-time Member of the Law Commission.
Justice M. Jagannadha Rao
Chairman
Dr. K.N. Chaturvedi
Member-Secretary
Dated: 7th June, 2005
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