Patna High Court
Smt. Ambika Bhawani Devi vs Chandrika Singh on 21 September, 1973
Equivalent citations: AIR1974PAT264, AIR 1974 PATNA 264
Author: N.L. Untwalia
Bench: N.L. Untwalia
JUDGMENT Untwalia, C.J.
1. This is a Letters Patent Appeal by the defendant on grant of leave under Clause 10 of the Letters Patent by the learned Single Judge who decided the connected Second Appeal. The facts may be taken from the judgment of this Court. Late Rai Bahadur Kedar Nath and three others were proprietors of eight annas share in Mahal Mordih Kalaunde bearing Tauzi No. 3195/1 in pargana maher, Thana Fatehpur in the district of Gaya. They were recorded as such in register D. The Mahal comprised of four villages. On 13-1-1947 the Tauzi (which, hereafter in this judgment, will mean the eight annas share of the recorded proprietors in the Mahal) was sold for arrears of land revenue by the Collector of Gaya and was purchased by the plaintiff respondent. After confirmation of the sale, he took delivery of possession on 26-9-1947. Plaintiff's name, however, was not recorded in register D. Arrears of cess fell due. In a certificate proceeding started under the Bihar and Orissa Public Demands Recovery Act, 1914 (hereinfater called the Act), the Tauzi was sold for arrears of cess on 28-3-1949. The certificate proceeding in the first instance was started against a dead person but subsequently the heirs of Kedar Nath were substituted in the proceeding. When the property was sold on 28-3-1949, the heirs of Kedar Nath were on the record. Plaintiff, however, was not in the picture at all; at no stage of the Certificate proceeding plaintiff's name was ever shown as a certificate-debtor.
2. In the Certificate sale held on 28-3-1949 one Jadunandan Prasad was the auction-purchaser of the Tauzi. By a registered sale deed dated 9-9-1949 he sold the property to the defendant appellant. The Tauzi was again sold on 10-10-1949 for arrears of land revenue; in this sale the auction-purchaser was the defendant's husband. The amount of revenue which was due was about Rs. 120/-. The Tauzi was sold for Rupees 3,500/-. Thus there was a surplus amount to the tune of Rs. 3,380/- approximately. Both plaintiff and defendant applied before the Collector for the payment of the surplus amount, the former claiming that on the date of the revenue sale, i.e., on 10-10-1949 plaintiff was the owner of the Tauzi and was, therefore, entitled to the surplus amount and defendant claiming that she had purchased the property from Jadunandan Prasad who had purchased it in the certificate sale and, therefore, she was the owner of the Tauzi when revenue sale took place and she was entitled to the money. The Collector by his order dated 8-2-1952 held that the defendant was entitled to get the money. Accordingly the surplus amount was paid to her on 14-2-1952.
3. The plaintiff thereafter instituted a Miscellaneous case under Section 29 of the Act for setting the sale held on 28-3-1949 aside. The certificate officer by his order dated 3-6-1953, a copy of which is Ext. 8/a in the suit, set aside the sale. Jadunandan Prasad who was the auction-purchaser at the certificate sale filed Certificate Appeal No. 162 of 1953-54 which was dismissed by the Senior Deputy Collector with appellate powers on 13-4-1954; a copy of his order is Ext. 8. It may also be stated here that after setting aside of the sale the plaintiff again went to the Collector for payment of the surplus money but he directed him to seek his remedy in a civil court Accordingly, the plaintiff instituted the suit giving rise to this Letters Patent Appeal on 1-12-1956 for recovery of the surplus money aforesaid with interest.
4. The main bone of contention all throughout in this case between the parties is whether the suit is barred by limitation. If Article 62 of the Limitation Act, 1908 is applicable to the facts of the case then obviously the suit filed beyond three years of the date of payment of money to the defendant was barred by limitation. If, however, it was governed by the residuary Article being Article 120, as has been held throughout, then the suit was not barred by limitation. The trial court decreed the suit with interest from the date of payment of the money to the defendant till the institution of the suit as also interest pendente lite and future. The lower appellate court affirmed this decree. The High Court has held that the plaintiff was not entitled to interest prior to the institution of the suit and hence the decree passed by the courts below has been modified to some extent. On grant of leave, as slated earlier, the defendant has presented this Letters Patent Appeal.
5. Various decisions have been discussed by the learned Judge in this judgment under appeal. On consideration of the law enunciated in them, the learned Judge was of the opinion that in many of the cases in which Article 62 was applied the defendant could not claim that on the day he received the money he was legally entitled to it. Finally the view formulated by the learned Judge is in these terms--
"It follows, therefore, that if, when defendant receives the money, plaintiff is not entitled to it by reason of an adverse judgment then existing against him, the mere circumstance that by the subsequent reversal of that judgment plaintiff became entitled to the money, could not make Article 62 applicable and in such cases Article 120 would apply."
6. In the opinion of the learned Judge, so long the certificate sale held on 28-3-1949 stood and was not set aside by a competent court, the plaintiff could not say that he was entitled to the money which was paid to the defendant on 14-2-1952. When an argument was advanced before him that according to the plaintiff's case the sale was void and, therefore, even on the date of payment he was entitled to the money, it was repelled by taking the view that the sale was not void but was voidable.
7. Mr. J.C. Sinha, learned Counsel for the appellant, mainly placed reliance upon only two decisions--one of the Supreme Court and the other of this Court, they are--A. Venkata Subbarao v. State of Andhra Pradesh (AIR 1965 SC 1773) and the Patna Municipal Corporation v. Shree Bihariji Mills Ltd. (AIR 1972 Pat 357). Learned Counsel further submitted that when the money was paid to the defendant on 14-2-1952, there was no impediment in the way of the plaintiff in his straight going to the civil court to file a suit for recovery of the money, as, on the facts and in the circumstances of this case, his right in the Tauzi was not at all affected by the certificate sale held on 28-3-1949, because under Section 26 of the Act, as it stood at the time of the said sale, only the right, title and interest of the certificate debtor, which was nil, passed in that sale and no part of the right, title and interest of the plaintiff passed. Hence, learned Counsel submitted that in view of the principle enunciated in the two decisions mentioned above it must be held that Article 62 governed this case and the suit was barred by limitation. After careful consideration and scrutiny of the matter, the argument put forward on behalf of the appellant has been found to be sound and must succeed.
8. It is not necessary to discuss the various cases on the point when we have got an authoritative pronouncement of the law by the Supreme Court in the case of Venkata Subbarao AIR 1965 SC 1773. Ayyangar, J., delivering the judgment for himself and Bachawat, J., and, on this point Sarkar, J., as he then was, does not seem to have struck any note of dissent, posed certain questions in paragraph 55 of the judgment at page 1791 in these terms--
"(1) Does Article 62 embody the essential elements of the action known in English Law and pleading as the 'action for money had and received' to the plaintiff's use ?" (2) Does the fact that at the moment of receipt the defendant intended to receive the money for his own benefit and not for the sake of the plaintiff render the Article inapplicable ? Stated in other terms is a literal compliance with the words that the money must have been received by the defendant for the plaintiff's use necessary before the Article applies, or is it sufficient that the circumstances of the case are such that the plaintiff being entitled in equity to the money, the law would impute to the defendant the intention to hold it for the plaintiff's use and compel a refund of it to the plaintiff."
The Supreme Court approved the view of Mookerjee, J., in Mohamed Wahib v. Mobomed Ameer, (1905) ILR 32 Cal 527 by quoting a passage from page 533, which runs as follows:--
"The Article, when it speaks of a suit for money received by the defendant for the plaintiff's use, points to the well-known English action in that form; consequently, the Article ought to apply wherever the defendant has received money which in justice and equity belongs to the plaintiff under circumstances which in law render the receipt of it, a receipt by the defendant to the use of the plaintiff".
Elaborating this dictum of the Calcutta High Court, the Supreme Court has said--
"In other words, the learned Judge held that it was not necessary in order to attract Article 62 that at the moment of the receipt the defendant should have actually intended to receive it for the use of the plaintiff and that it was sufficient if the receipt was in such circumstances that the law would impute to him an obligation to retain it for the use of the plaintiff and refund to him when demanded."
The decision of the Calcutta High Court in Anantram v. Hemchandra, AIR 1923 Cal 379, which has been followed by the Bombay High Court in Lingangouda Marigouda v. Lingangouda Fakirgouda, AIR 1953 Bom 79 putting a literal construction on Article 62 was not approved. And, finally in paragraph 62 some illustrations were given to point out in which cases Article 62 will not apply. One of these illustrations is in these terms--
"Lastly, if the right to refund does not arise immediately on receipt by the defendant but arises by reason of facts transpiring subsequently, Article 62 cannot apply, for it proceeds on the basis that the plaintiff has a cause of action for instituting the suit at the very moment of the receipt."
The decision of the Madhya Pradesh High Court in Govind Singh v. State of Madhya Pradesh, AIR 1961 Madh Pra 320 was also approved in paragraph 63.
9. It would thus be seen that the law laid down by the Supreme Court is that the expression in column 1 of Article 62 of the First Schedule to the Limitation Act, 1908 -- 'money received by the defendant for the plaintiff's use' -- does not mean that when the defendant received the money, he must have intended to receive it for the plaintiff's use either expressly or by necessary implication. In passing, I may just observe that the test laid down by this Court in the case of Harihar Misser v. Syed Mohammed, AIR 1916 Pat 54 that the matter will depend upon the intention of the person paying the money to the defendant, is irrelevant and does not find support from any decision. The Supreme Court pointed out that if, the fact, the defendant received the money which on the date of receipt did not belong to him in the eye of law but belonged to the plaintiff then also Article 62 will be attracted and the starting point of limitation, as given in column 3, will be the date when the money is received. If there was a legal bar in the way of the plaintiff in making a claim to the money on the date when it was paid to the defendant then, surely, Article 62 will not come into force; nor, will it come into force on removal of the bar. In such a case, obviously, the Article applicable would be Article 120. Question in this case is whe-[ ther, as a matter of law, it was incumbent on the plaintiff to get the sale set aside or declared void before he could claim the money from the defendant. If that be so, then Article 120 has rightly been applied by the courts below as also by this Court. If, on the other hand, the plaintiff, in the eye of law, was entitled to the money paid to the defendant on 14-2-1952 then on this date for its recovery he could straightway go to the Civil Court. In that event the law of limitation in accordance with the language- in Article 62 will govern the case. For decision of this question an important point which is purely a question of law seems to have been missed by all the courts below and that is this.
10. Attention must be focussed at this stage on the fact that on the date of the certificate sale, i.e., 28-3-1949 the tauzi belonged to the plaintiff. Although he was responsible for not paying the cess dues, the authorities, when they proceeded to realise the dues through certificate sale, forgot that the Tauzi had already been sold in the revenue sale to the plaintiff and no right, title and interest was left in the original proprietors on the date of the certificate sale. Section 26 (1) of the Act provides--
"Where property is sold in execution of a certificate there shall vest in the purchaser merely the right, title and interest of the certificate-debtor at the time of the sale, even though the property itself be specified."
Sub-section (6) was added in Section 26 by Bihar Public Demands Recovery (Second Amendment) Act, 1951 (Bihar Act II of 1952). This sub-section places the certificate sale for realisation of cess dues more or less on the footing of the revenue sale where not only the right, title and interest of the certificate debtor passes but the Tauzi itself passes to the purchaser. But, obviously, the language of sub-section (6) is prospective and cannot govern a sale which was held before the introduction of this sub-section in Section 26 of the Act. It is, therefore, clear that on 28-3-1949 the right, title and interest of the certificate-debtor passed on to Jadunandan Prasad, the right, title and interest of the certificate-debt or on that date was nil, the whole of it had vested long ago in the plaintiff and even on that date it was in the plaintiff. That being so, the plaintiff was not the person whose interest was affected by the sale and it was not necessary for him to go to the Certificate Officer under Section 29 of the Act for setting aside the sale. He was ill-advised to do so. Straightway he could institute a suit in the Civil Court and establish the fact that the Tauzi belonged to him on the date of the second revenue sale as his right, title and interest had not been affected by the certificate sale and, therefore, he was entitled to the surplus money which had wrongly been handed over to the defendant.
11. While following the decision of the Supreme Court, Shambhu Prasad, Singh, J., sitting in Division Bench, who had decided the present Second Appeal sitting singly, repelled the argument that if the plaintiff could not get the money without the institution of a suit then he had no right to claim the money on the date when it was paid to the defendant in these terms--
"In every case of illegal realisation of money, if the money is not returned voluntarily by the defendant, the plaintiff has to get a finding from the court that the realisation was illegal. That is not a fact transpiring subsequently upon which the right to refund arises. Where on the date the money is realised, the realisation is illegal, the right to refund arises immediately and in my opinion, suits for recovery of such money instituted before the new Limitation Act came into force would be governed by Article 62 of the first Schedule to the Indian Limitation Act (Act 9 of 1908)."
In the Madhya Pradesh case AIR 1961 Madh Pra 320 tax had to be paid with the return and the assessee was not entitled to the refund of any portion of the tax paid under the rules until the assessment was made. Therefore, on the date of the excess payment plaintiff was not entitled to the money. There was an impediment in his way in getting it. The impediment was removed when the assessment order was passed. And, that is the reason that Article 62 could not be applied and Article 120 was applied.
11-A. On a careful consideration of the matter, therefore, in my judgment, Article 62 of the Limitation Act, 1908 would apply in this case and the suit of the plaintiff was filed beyond three years of the date of payment of the money to the defendant; hence it was barred by limitation. There does not seem to be any justifiable escape in law from this position. That being so, this Letters Patent Appeal is allowed, the judgments and decrees of all the three Courts below are set aside and the plaintiff's suit is dismissed but in the circumstances both the parties are directed to bear their own cost throughout.
S.K. Jha, J.
12. I agree.