2016 (1) TMI 1390 - HC - Indian Laws

Dismissal of appeal on account of limitation - whether the trial court was right in coming to the conclusion that the suit was barred by limitation? - applicability of Section 14 of Limitation Act 1963 - Held that - The trial court in the impugned judgment has not discussed this aspect of the matter at all. Therefore the impugned judgment is flawed on this count. Applicability of Section 14 of Limitation Act 1963 - Held that - In a case where sub-section (3) of Section 14 is not applicable the requirement is that the concerned court should be unable to entertain the civil proceeding on account of defect of jurisdiction or other cause of a like nature . There is a subtle but a clear distinction in the two provisions. Where sub-section (3) of Section 14 is triggered the court must come to the conclusion that the suit would fail on account of defect of jurisdiction or other cause of a like nature. The expression that the suit must fail by reason of some formal defect finds a mention in Order 23 Rule 1(3) clause (a) of the CPC as well. In my opinion the setting in which the expression defect in jurisdiction of the court or other cause of a like nature appears in sub-section (3) of Section 14 is perhaps not the same as that which pertains to a somewhat similar expression i.e. defect of jurisdiction or other cause of a like nature which stand incorporated in sub-section (1) of Section 14. The expression or other cause of a like nature need not necessarily have the same connotation as that which one may give to the very same expression appearing in sub-section (3) of Section 14. It is not the likeness of the expression but the setting in which the expression is found incorporated which is of greater relevance. Therefore if the time spent by the appellant in prosecuting the writ remedy (i.e. between the date of institution of the writ and its withdrawal) is excluded which must be so then the suit could not have been dismissed on the ground of limitation. Appeal allowed.

Summary

Issues Involved:
1. Whether the suit was barred by limitation.
2. Whether the provisions of Section 14 of the Limitation Act, 1963 were correctly applied by the trial court.

Detailed Analysis:

1. Whether the suit was barred by limitation:
The trial court summarily allowed the application filed by respondent no.3 under Order 7 Rule 11 of the CPC, concluding that the suit was barred by limitation. The appellant argued that the period of limitation could only be determined after the suit had been put to trial, as it involved a mixed question of fact and law. The trial court, however, did not discuss whether the suit was within limitation on its own strength without relying on Section 14 of the Limitation Act, 1963. The appellant claimed that the cause of action was continuing as the payments had not been released by the respondents. The court found that the trial court's judgment was flawed on this count, as it did not consider the assertions made by the appellant regarding the continuing cause of action and the plea taken by respondents no.1 and 2 that they would pay the pending bills once they were released by respondent no.3.

2. Whether the provisions of Section 14 of the Limitation Act, 1963 were correctly applied by the trial court:
Section 14 of the Limitation Act permits the exclusion of time spent in prosecuting another civil proceeding with due diligence, provided it relates to the "same matter in issue" and was prosecuted in good faith in a court that was unable to entertain it due to "defect of jurisdiction" or "other cause of like nature." The trial court held that the benefit of Section 14 was not available to the appellant as the writ petition and the suit did not relate to the same matter in issue, and the writ petition was not dismissed due to a defect in jurisdiction. The appellant argued that both actions related to the non-payment of monies for work executed, and the writ petition was withdrawn due to the nature of the issues involved, which were more appropriate for a civil proceeding.

The court found that the trial court's interpretation was too narrow. The expression "same matter in issue" in Section 14(1) of the Limitation Act does not require complete identity of reliefs or causes of action but rather a broad similarity in the matters in issue. The court concluded that both the writ petition and the suit related to the same issue of non-payment for work executed, and the writ petition was withdrawn because a civil proceeding was more appropriate for resolving the disputed questions of fact. The court also noted that Section 14 should be construed liberally to cover defects that are not strictly jurisdictional but are similar in nature.

The court referenced several Supreme Court judgments that supported a liberal interpretation of Section 14, including Roshan Lal Kuthalia Vs. R.B. Mohan Singh Oberoi, Union of India vs. West Coast Paper Mills Ltd., and Shakti Tubes Ltd. Vs. State of Bihar and Ors., which held that time spent in prosecuting a writ petition could be excluded under Section 14 if the writ petition was prosecuted in good faith.

Conclusion:
The court set aside the impugned judgment and decree, allowing the appeal. The trial court was directed to take up the suit for adjudication from its current position, with parties and their counsel to appear before the trial court on a specified date. No orders as to costs were made, and the Registry was instructed to remit the record to the trial court.