Bombay High Court
Chetan Navnitlal Shah vs Navnitlal Ratanji Shah And Anr And Bank ... on 22 February, 2017
Author: G. S. Patel
Bench: G.S. Patel
Chetan Shah v Fizza Navnitlal Shah
4-NMS1469-14.DOC
ATUL
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
NOTICE OF MOTION NO. 1469 OF 2014
IN
SUIT NO. 1015 OF 2014
Chetan Navnitlal Shah,
an Indian Inhabitant, having address at
Wyoming Co-op Housing Society Ltd, Little
Gibbs Road, Malabar Hill, Mumbai 400 006 ...Plaintiff
~ versus ~
Fizza Navnitlal Shah,
w/o Navnitlal Ratanji Shah, an Indian
Inhabitant, having address at Flat No. M-3,
M-4, 13th Floor, Eden Hall, Loyal
Cooperative Housing Society, Dr Annie ...Defendant/
Besant Road, Worli, Mumbai 400018 Applicant
~ and ~
1. Bank of India,
Mumbai Overseas Branch, Bank of
India Building, Mezzanine Floor, 70-
80, Mahatma Gandhi Road, Fort,
Mumbai 400 001
2. Office of the Assistant
Commissioner of Income
Tax,
Central Circle 22 & 30, Room No.
465, 4th Floor, Aayakar Bhavan,
M.K. Road, Mumbai 400 020 ...Respondents
Page 1 of 25
31st January 2017 & 22nd February
2017
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Chetan Shah v Fizza Navnitlal Shah
4-NMS1469-14.DOC
for the plaintiff for the defendant
Mr Pradeep Sancheti, Senior Mr Snehal Shah, with Mr
Advocate, with Mr Darshit jain, Zain Mukhi, Ms Kirtida
Mr SB Rao & Ms Anisha Nair, Chandarana & Ms Sonali
i/b India Law. Mehta, i/b Mahernosh
Humranwala
CORAM: G.S. Patel, J
31st January 2017 &
DATED:
22nd February 2017
ORAL JUDGMENT:
1. Originally, there were two defendants to this suit. The original 1st Defendant, Navnitlal Ratanji Shah, died. The Plaintiff amended his plaint, and deleted Navnitlal as a defendant. The original 2nd Defendant is now the sole defendant to the suit. This Notice of Motion is by the 2nd Defendant. She has not yet amended the title to her Notice of Motion. She will do so, deleting the name of the original 1st Defendant, before 10th February 2017. The registry will not insist on re-verification. The full title to this order show the correct title in the suit with the name of the original 1st Defendant deleted.
2. On 24th November 2014, RD Dhanuka J framed a preliminary issue under Section 9A of the Code of Civil Procedure 1908 ("CPC"). The issue was of limitation and it was raised specifically in paragraphs 13 to 16 of the Defendant's Affidavit in Page 2 of 25 31st January 2017 & 22nd February 2017 ::: Uploaded on - 22/02/2017 ::: Downloaded on - 23/02/2017 01:03:22 ::: Chetan Shah v Fizza Navnitlal Shah 4-NMS1469-14.DOC Support of their Notice of Motion No. 1469 of 2014. Dhanuka J framed the following issues:
"(1) Whether any part of the relief is barred by limitation?
(2) What orders?"
3. The Plaintiff desired to lead evidence. The Court issued directions for filing his Affidavit of Evidence, Affidavit of Documents, statements of admission and denial, and other pre-trial formalities on the preliminary issue. The Plaintiff filed two Affidavit in lieu of Examination-in-Chief The first is dated 21st April 2015. The second, additional, Affidavit in lieu of Examination-in-Chief is dated 4th September 2015. The Plaintiff also put in evidence seven documents separately compiled as Exhibits "P1" to "P7". The Plaintiff was cross-examined on commission on 3rd March 2016, after which he closed his case.
4. The Plaintiff led no other witness. This was not for want of trying: he filed Chamber Summons (L) No. 46 of 2017 for leave to lead further evidence and to introduce further documents, despite his counsel having closed his case before the Commissioner. I dismissed the Chamber Summons on 13th January 2017, not only because he had closed his case but also on merits. I held the Plaintiff could not compel production by the Defendant of unspecified documents to shore up his case. I am told today the Plaintiff has appealed the order of 13th January 2017. Mr Sancheti sought an adjournment for that reason. He said, in fairness, the Appeal Court has not yet admitted his appeal, nor stayed further hearings on the Page 3 of 25 31st January 2017 & 22nd February 2017 ::: Uploaded on - 22/02/2017 ::: Downloaded on - 23/02/2017 01:03:22 ::: Chetan Shah v Fizza Navnitlal Shah 4-NMS1469-14.DOC preliminary issue. I declined the request. Mr Sancheti's adjournment request was unnecessary for, having heard him and Mr Shah for the Defendants, and for the reasons that follow, I have found the existing material sufficient to hold for the Plaintiff on the preliminary issue.
5. What is the case with which the Plaintiff has come to Court? What is it that he seeks in the Suit? The issue of limitation cannot be decided only on legal submissions. It is a mixed question of fact and law. The evidence led lends context and texture to the pleadings. We learn of the parties' transactions, their relationships, and how they conducted themselves over time.
6. Consider first the parties to the suit. The suit was originally brought against two Defendants. For convenience, I refer to the parties by their names from this point onward. The original 1st Defendant, Navnitlal Ratanji Shah ("Navnitlal"), since deceased, was the father of the Plaintiff, Chetan Navnitlal Shah ("Chetan"). The original 2nd Defendant, Fizza Navnitlal Shah ("Fizza") is Navnitlal's second wife, Chetan's stepmother. Navnitlal died on 13th June 2015. He was then deleted as a defendant; the plaint was amended. The contest is now between Chetan and Fizza. But this array of parties tells us only part of the story. The narrative in the Plaint is about the relations and transactions between Chetan and Navnitlal during the latter's lifetime, and the discord between Chetan and Fizza when she entered Navnitlal's life. Today, I am not asked to assess the interpersonal relations or dynamics between the parties. That may not be necessary even at the final trial of the suit. That is not the frame of the suit at all.
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7. This is how the plaint proceeds. In paragraph 2 of the plaint, Chetan says that till Navnitlal married Fizza, father and son were on good terms. Chetan alleges hostility and aggression by Fizza. He makes several other allegations in paragraph 3. It is unnecessary to reproduce these. Paragraph 4 is critical:
"4. The Plaintiff states that the deceased has been advanced by the Plaintiff various sums from time to time which when netted aggregate to Rs. 41,16,53,391/-. The advances and repayments from time to time are reflected in the personal balance sheets of the deceased and as well as in the ledger account maintained by the Plaintiff in his books of accounts. A copy of the said ledger account of the deceased in the books of the Plaintiff for the period from 1st April 2007 to 31st March 2014 are annexed hereto and marked as Exhibit "A1". A copy of the deceased's duly audited balance sheet of financial year 2013-2014 is annexed hereto and marked as Exhibit "A2"."
(Emphasis added)
8. The document Exhibit "A2" was central to Chetan's application for additional evidence (the Chamber Summons I dismissed on 13th January 2017). The plaint refers to a copy of Navnitlal's audited balance sheet, not Chetan's. During the evidence, Chetan made no attempt to introduce this document, or his copy of it. He did not disclose his copy. He only sought to draw it from the defendant. I will return to the reference to this document a little later in the judgment.
9. In the plaint, Chetan then goes on to say that Navnitlal and Fizza then acquired some properties jointly. Two of these are Page 5 of 25 31st January 2017 & 22nd February 2017 ::: Uploaded on - 22/02/2017 ::: Downloaded on - 23/02/2017 01:03:22 ::: Chetan Shah v Fizza Navnitlal Shah 4-NMS1469-14.DOC relevant to our purposes. The first, described in paragraph 5(b), is a commercial property, office No. 46 on the 4th Floor of Free Press House with a car parking at Free Press Journal Marg, Nariman Point, Mumbai, bought in March 2008 ("the Free Press House property"). The second is described in paragraph 5(c): non- agricultural land of about 1255.33 sq yards at Plot No. 3 lay out with a residential building at Tungarli Village near Lonavala in Pune District ("the Lonavala property"), bought in July 2008. There are two other properties, but I am not concerned with those today.
10. In paragraph 6 of the plaint Chetan sets out what his Suit is for:
"6. The Plaintiff states that the present suit is filed inter alia for declaration that the Plaintiff is the rightful owner in respect of two of the properties mentioned in item (2) and (3) of Exhibit B hereto i.e. the Free Press House property and Lonavala property, recovery of a sum of Rs.
29,12,52,251/- and consequential reliefs or in the alternative recovery of a sum of Rs. 41,16,53,391/- which has been advanced to the deceased by the Plaintiff from time to time along with interest accrued thereon and consequential reliefs."
11. In paragraph 7, Chetan claims that these two properties, i.e., the Fress Press House property and the Lonavala property, were purchased with funds that Chetan lent his father over time. Obviously, since those properties were purchased in March and July 2008 respectively, this claim relates to the loans he gave until then.
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12. I have not permitted Mr Shah to raise as a preliminary issue the question of whether these purchases were benami and whether the claim is hit by the Benami Transactions Prohibition Act. Despite a categorical averment in paragraphs 7(a) and 7(b), no such preliminary issue on jurisdiction was framed before the parties went to trial. Fizza never asked for another preliminary issue to be framed on this ground. She put no case to Chetan in cross-examination on this either. It is not possible to let her now take this plea, especially since I have by now denied Chetan an opportunity to lead further evidence. If Fizza wants to raise an additional plea at this stage, then Chetan must be permitted to lead additional evidence. A party cannot take either the other side or the court unawares like this, by raising an issue beyond those on which the parties went to trial. In fairness, Mr Shah did not press his argument under the Benami Act any further.
13. Paragraphs 8 and 9 of the plaint then deal with certain loan transactions in relation to another property. Paragraph 10 says that Navnitlal and Fizza periodically took various loans from Chetan in cash for personal expenses. After Navnitlal's health began to deteriorate in 2013 and, with it, the relationship between Chetan and Fizza, Chetan found, or so he says, that there were several transfers being made out of Navnitlal's accounts to Fizza's accounts. Chetan then demanded repayment by his Advocate's notice dated 7th February 2014. There is a short holding Reply, which says less than nothing. There is a reiteration of the demand on 24th February 2014.
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14. Paragraph 12 reads thus:
"12. The Plaintiff states and submits that each of the aforesaid amounts mentioned hereinabove is paid by cheque and set out in detail in the books of account of the Plaintiff and books of the deceased. The Plaintiff craves leave to refer to and rely upon the books of accounts of the Plaintiff and the deceased to establish the aforesaid net sum of Rs. 41,16,53,391/-. The Plaintiff states that this payment which has been enumerated in the books of accounts which includes the payments towards aforesaid three properties, the details of which are set out already hereinabove. Thus, after deduction of the cost of acquisition of the two properties paid for by the Plaintiff there is a due and payable by the deceased to the Plaintiff a sum of Rs. 29,12,52,251/-. The Plaintiff is entitled to decree for the said amount and with interest accrued thereon @ 24% p.a. from 1st January 2013 to 31st May 2014 aggregating to Rs. 38,96,39,799/- as set out hereinafter with further interest accrued thereon."
15. Paragraph 33 has the jurisdictional averments.
"33. The Plaintiff is residing at Mumbai and the Defendants are residents of Mumbai. Thus, the entire cause of action has arisen within the jurisdiction of this Hon'ble Court. The present suit is for recovery of the personal loan granted to the deceased in Mumbai and hence this Hon'ble Court has the jurisdiction to entertain and dispose of the present suit. The Plaintiff states that one of the property of the Defendant for which attachment is sought is situated outside Mumbai. Therefore, upon leave under Clause XII of the Letters Patent being granted to the Page 8 of 25 31st January 2017 & 22nd February 2017 ::: Uploaded on - 22/02/2017 ::: Downloaded on - 23/02/2017 01:03:22 ::: Chetan Shah v Fizza Navnitlal Shah 4-NMS1469-14.DOC Plaintiffs, this Hon'ble Court will have the jurisdiction to entertain, try and dispose of the present Suit."
(Emphasis added) Mr Shah relies on the third sentence of this paragraph as being in his favour, saying that this is therefore a suit for recovery of a loan. I will return to this.
16. Prayers (a) to (f ) are final prayers. The rest are interim prayers.
"(a) That this Hon'ble Court be please to declare that the Plaintiff is the rightful owner in respect of the properties more particularly mentioned in the item No.(2) and (3) in Exhibit B hereto;
(b) That this Hon'ble Court be please to declare that the estate of the deceased and the Defendant has no right, title or interest in respect of properties mentioned in item No. (2) and (3) in Exhibit B and the Plaintiff is alone entitled to the same;
(c) That this Hon'ble Court be pleased to order and decree the Defendant to handover to the Plaintiff vacant, quiet and peaceful possession of the properties described in item No.(2) and (3) in Exhibit B hereto;
(d) That the estate of the deceased and the Defendant be ordered and decreed to pay to the Plaintiff the sum of Rs.38,96,39,799/- of which Rs.29,12,52,251/- is the principal outstanding, Rs.9,83,57,548/- is towards interest @ 24% p.a. from 1st January 2013 to 31st May 2014 together with further interest on principle outstanding @ 24% p.a. Page 9 of 25 31st January 2017 & 22nd February 2017 ::: Uploaded on - 22/02/2017 ::: Downloaded on - 23/02/2017 01:03:22 ::: Chetan Shah v Fizza Navnitlal Shah 4-NMS1469-14.DOC from 1st June 2014 till payment or realisation to the Plaintiff as per the Particulars of Claim being Exhibit "K-1" hereto;
(e) That in the event the Hon'ble Court is coming to the conclusion that the Plaintiff is not the owner in respect of the properties in item No.(2) and (3) in Exhibit B hereto then in that event this Hon'ble Court be pleased to order and decree the estate of the deceased and the Defendant to pay to the Plaintiff a sum of Rs.55,08,12,394/- of which Rs.41,16,53,391/- is the principal outstanding, Rs.13,91,59,003/- is towards interest @ 24% p.a. from 1st January 2013 to 31st May 2014 together with further interest on principle outstanding @24% p.a. from 1st June 2014 till payment or realisation to the Plaintiff as per the Particulars of Claim being Exhibit "K-2" hereto;
(f ) That it be declared that the amount mentioned in prayer clause (e) above is secured by a valid and subsisting charge on the property more particularly described in item No. (2) and (3) in Exhibit B hereto and the Plaintiff is entitled to enforce the said securities towards the amounts due and payable by the estate of the deceased and the Defendant to the Plaintiff in the terms of prayer (e) above;"
17. There is perhaps an awkwardness in the frame of these prayers but that has never been a reason for a Court to deny substantial relief where it is justified. Prayers (a) and (b), the second being the mirror image of the first, are prayers based on title. They seek a declaration that Chetan owns the Lonavala and Free Press House properties. Mr Shah points out, and I think he is correct, that this is not Chetan's case in the Plaint at all. Chetan does not say that he lent and advanced monies for the purchase of these properties. He only says that the loans he gave were used for the purchase of Page 10 of 25 31st January 2017 & 22nd February 2017 ::: Uploaded on - 22/02/2017 ::: Downloaded on - 23/02/2017 01:03:22 ::: Chetan Shah v Fizza Navnitlal Shah 4-NMS1469-14.DOC these properties, a very different thing. It is on that basis he avers in paragraphs 7(a) and 7(b) that he is the beneficial owner of both those properties, and that they were held by Navnitlal and Fizza, and now by Fizza alone, only in name. This is why he seeks possession in prayer clause (c). Prayer clause (d) is for return of the balance after adjusting for the acquisition price of the Free Press House and Lonavala properties. The amounts sought is Rs. 38,96,39,799/- of which Rs. 29,12,52,251/- is the principal.
18. Prayer (e) is at the centre of this plaint. It is crucial. Its phrasing is most interesting. It is framed as an alternative prayer. This prayer is sought in the event that the Court finds that Chetan is not the true owner and not entitled to possession of the Free Press House and the Lonavala properties. The prayer is for recovery of an amount of Rs. 55,08,12,394/-. Of this Rs. 41,16,53,391/- is said to be the principal. Then there is a claim for interest. Prayer (f ) then seeks, as a concomitant to prayer (e), that these properties be charged with the repayment of the claim.
19. It seems to me it was equally possible for Chetan to have filed the suit only for prayers (e) and (f ) as they currently stand. It was also possible for Chetan to have cast prayers (e) and (f ) as his principal prayers and taken prayers (a) to (d) as the prayers in the alternative.
20. I turn now to the evidence Chetan led in support of this claim. It is the first Affidavit of Evidence that is crucial. In paragraph 4 of this Affidavit, Chetan says the Free Press House Page 11 of 25 31st January 2017 & 22nd February 2017 ::: Uploaded on - 22/02/2017 ::: Downloaded on - 23/02/2017 01:03:22 ::: Chetan Shah v Fizza Navnitlal Shah 4-NMS1469-14.DOC property was acquired by Navnitlal and Fizza substantially out of funds he loaned Navnitlal. In paragraph 5, he says the same thing about the Lonavala property. Paragraph 6 of this Affidavit of Evidence reads thus:
"6. I say that I have lent and advanced monies to Defendant No. 1 from time to time an aggregate amount of Rs. 41,16,53,391/- by cheque. Defendant No. 1 has been making repayment to me from time to time of diverse amounts by cheque. The last of the payment of Rs. 2 lakhs was made by Defendant No. 1 to me on 31st March 2012 by cheque bearing No. 848916 drawn on Bank of India, Overseas Branch for a sum of Rs. 2 lakhs in part payment of the diverse amounts lent and advanced by me to the Defendant. I say that the said cheque was deposited by me in my bank account bearing No. 54030684947 with State Bank of Mysore Branch. In my ledger account I have maintained an account of Defendant No. 1 in the manner stated hereinafter."
(Emphasis added)
21. This paragraph makes it clear that Chetan seeks to recover the aggregate of loans he advanced his father over time, and which formed some sort of a standing or running account between them. There were periodic loans, and periodic repayments in whole or in part. This is evident from Chetan's assertion of "the aggregate"
loaned, and the subsequent reference to repayment of part of the loan by cheque. In other words, this was the usual kind of running account transaction with both credit and debit entries going on over time. In paragraph 7, Chetan says that he maintained accounts including a ledger book, cash book and bank book. He produced Page 12 of 25 31st January 2017 & 22nd February 2017 ::: Uploaded on - 22/02/2017 ::: Downloaded on - 23/02/2017 01:03:22 ::: Chetan Shah v Fizza Navnitlal Shah 4-NMS1469-14.DOC these. In paragraph 10 he makes a reference to Navnitlal's ledger account in Chetan's books and says that this reflects the periodic debits and credits. He reiterates that the last credit was of 31st March 2012. This date is crucial; the suit was filed on 24th June 2014.
22. In paragraph 11, Chetan refers to his tax documents including his returns from 2007-2008 (about the time the two properties in question were purchased) up to 2013-2014, i.e., just before the filing of the Suit. This is relevant because this range covers, first, the period when, according to Chetan, funds he loaned were used to purchase the two properties and, second, the later period during which a small repayment was made to him by cheque (2012). The documents extend to a period of two years thereafter.
23. A quick look at the documents in evidence. Exhibit "P1" is a ledger account. Chetan attests to it. It shows amounts being paid out to Navnitlal at various times from 1st April 2007 all the way to March 2014. Mr Shah complains that these are the Plaintiff's own documents. That is true. But what of it? It is obvious that the Plaintiff will produce documents of which he is familiar and to which he can attest, including accounts that he himself maintains. This is the best evidence that is available to him. These are matters specially within his knowledge. He can hardly be expected to do more than this. To say only that these are 'only' the Plaintiff's documents is no answer at all. In Exhibit "P7" Chetan then produces various bank statements. Mr Sancheti was at some pains to point out that bank statements entries correspond exactly to the ledger accounts. For example, the three entries of 4th November, Page 13 of 25 31st January 2017 & 22nd February 2017 ::: Uploaded on - 22/02/2017 ::: Downloaded on - 23/02/2017 01:03:22 ::: Chetan Shah v Fizza Navnitlal Shah 4-NMS1469-14.DOC 6th November and 7th November 2009 at page 49 correspond exactly to entries in the Chetan's ledger account for Navnitlal at page 3 of the compilation. Thus we find internal consistency and internal corroboration. That is not all. The audited balance sheets and profit and loss accounts are also produced for the years ending 31st March 2011, 31st March 2012, 31st March 2013 and 31st March 2014 apart from previous years. The audited balance sheets for the year ending 31st March 2012 shows Navnitlal's name among others in the schedule of loans and advances to associates. The amount said to be due from Navnitlal to Chetan is nearly Rs. 39 crores for this year. For the year ending 31st March 2013 there is a similar entry at page 223 of the compilation. The amount is now Rs. 41,06,00,198/-. This only means that between these financial year endings, Chetan has put into evidence showing he advanced loans to Navnitlal.
24. For the very next year ending 31st March 2014 there is an entry at page 248 which again shows Navnitlal's name as one of the debtors and the amount here is Rs. 41,16,53,391/-. This is exactly the figure in prayer (e) of the plaint. It is clear that the figure claimed in the Suit is not without a supporting basis.
25. With this background I should now consider the cross- examination on commission. It is mercifully brief. Chetan was first asked if he could identify the dates on which he claimed to have lent money to Navnitlal. He said he started paying since 1993. He then went on to say that it is a matter of fact that he had lent money to Navnitlal since April 2007. He said he has submitted the bank statements and ledger account in response to question whether he Page 14 of 25 31st January 2017 & 22nd February 2017 ::: Uploaded on - 22/02/2017 ::: Downloaded on - 23/02/2017 01:03:22 ::: Chetan Shah v Fizza Navnitlal Shah 4-NMS1469-14.DOC could identify the dates on which he had lent these amounts. He was shown Exhibit "P1", i.e., his ledger account, and Exhibit "P7", the bank statements, and was asked to identify the dates of these loans. I will reproduce Questions 6 and 7:
"Q.6 Having seen Ex.P-1 (colly) and Ex.P-7 (colly) can you now identify the dates on which, from time to time, you claim to have allegedly lent and advanced monies to Navnitlal R Shah (NRS)?
A. I cannot identify the dates.
Q.7 Can you tell us whether the amounts allegedly
provided/lent by you to NRS as stated in para 4 and 5 of your Affidavit of Evidence dated 21st April 2015, are included in the aggregate amount of Rs. 41,16,53,391/-?
A. Yes. They are included."
26. Mr Shah's case for the Defendant is that, correctly read, the suit is for recovery of a series of loans. Each of these loans has its own starting and ending point of limitation. Each of these loans must be identified. Those loans that are out of time cannot be clubbed with any loans that might be within limitation. If the Plaintiff is unable to identify which portion of his claim or which loan is within time and which is not, i.e., if he is unable to specify the dates of these loans then the entire suit is barred by limitation. I not possible, he says, to take advantage of Article 19 of the Limitation Act without this being specified. In his submission, this is a suit that would be covered by Article 58 if it relates to the declaration sought in prayer clauses (a) and (b), or Article 19 if the Page 15 of 25 31st January 2017 & 22nd February 2017 ::: Uploaded on - 22/02/2017 ::: Downloaded on - 23/02/2017 01:03:22 ::: Chetan Shah v Fizza Navnitlal Shah 4-NMS1469-14.DOC suit is seen as one for recovery of a loan, and such a suit must be brought within three years of the loan being made. At best, the suit would fall under Article 113, but in that case, since these are loans made periodically, each loan would carry its own separate period of limitation. It is not possible, Mr Shah says, to telescope all these loans into one single amount and thus seek to avoid the bar of limitation.
27. Mr Sancheti encourages me to look at the Suit as it is filed. The prayer is for a declaration on title accompanied by a prayer for injunction. It is not for me at this stage, he submits, to dissect the plaint to see whether his cause of action is good or bad or whether it has been proved or not. What I am to see is what is the relief sought and whether that relief can be said to fall within limitation. He invites my attention to Dhanuka J's order framing the issue and submits the main issue was carefully framed. It asks whether any part of the 'relief' is barred by limitation. If prayers (a), (b) and (c) and consequently prayer (d) relate to land then the present Suit, in his submission, is covered by Article 65 which is for possession of immovable property or any interest based on title therein. Mr Sancheti's submission is that for the purpose of Section 9A it is irrelevant and beyond my remit at this stage to assess the basis on which he claims that title. Whether that is correctly or incorrectly founded is necessarily a matter requiring evidence once issues are framed in the suit as a whole. That is not evidence that can be led in support of the preliminary issue. Plainly read, prayers (a), (b) and (c) on their own seek possession of the Lonavala and Free Press House properties based on a declaration of title. The limitation for this is 12 years from the time the possession of the defendant become adverse Page 16 of 25 31st January 2017 & 22nd February 2017 ::: Uploaded on - 22/02/2017 ::: Downloaded on - 23/02/2017 01:03:22 ::: Chetan Shah v Fizza Navnitlal Shah 4-NMS1469-14.DOC to the plaintiff. Mr Shah's response is that there is no starting point of limitation under Article 65 because possession of the defendant has never become "adverse" to the plaintiff. Again whether or not the possession of the Defendant is adverse is a matter of evidence for a later stage, but, if not, then this is surely in Mr Sancheti's favour rather than against him. Mr Sancheti also submits that the alternative prayer (e) and its consequent prayer (f ) must be read in this context. Prayer (e) is clearly cast in the alternative. This can only mean that the suit, right or wrong, is a suit for possession of immovable property based on title. That is its primary purpose. That is its primary frame. Seen from that perspective the suit is clearly within time.
28. Mr Sancheti makes a compelling argument at least on this aspect, viz., that the present enquiry is an assessment on the preliminary issue of limitation, as a question of jurisdiction, not an assessment on merits. I only test if that claim is brought within time, i.e., whether it should at all proceed to trial. Whether or not the claim is proved is for a later day. If the suit is in time, Chetan must at prove every element of his claim, but this is to be done at the final trial of the suit, not today.
29. That said, and irrespective of the wording chosen in the prayers, I do not think it is possible to say that this is a suit on title so much as it is a suit for recovery of an amount claimed to be due, with recovery sought against specified immovable property. This, I think, is the only fair way to read this plaint, and at least to this extent Mr Shah is right: no amount of clever drafting can be allowed to disguise the real cause of action in the suit. There are the Page 17 of 25 31st January 2017 & 22nd February 2017 ::: Uploaded on - 22/02/2017 ::: Downloaded on - 23/02/2017 01:03:22 ::: Chetan Shah v Fizza Navnitlal Shah 4-NMS1469-14.DOC categorical averment in paragraphs 4 and 33 of the plaint, and these cannot be wished away. Also, Chetan does not say that he gave his father money to buy property for Chetan or on his behalf. He says instead that his father used the amounts Chetan loaned him to buy property. The two are not the same. If this is, therefore, a suit for recovery of an amount due, the question is whether Chetan's claim for recovery or any part of it is barred by limitation.
30. Faced with this, Mr Sancheti says that even if this is seen as a suit for recovery of a money claim, it is still within time. The amount claimed in prayer clause (e) is the exact amount shown due from Navnitlal in the profit and loss account for the year ending 31st March 2014. Second, there is the assertion in paragraph 4 of the plaint I have set out earlier. Third there is the assertion in the Affidavit of Evidence of amounts being lent periodically and of a part repayment by cheque in 2012. It is significant, Mr Sancheti urges, that on none of these crucial aspects is there any cross- examination at all. A general cross-examination of the kind that was put to Chetan will not do.
31. Mr Sancheti may well be right on this. Let me consider for a moment the testimony or deposition in the first Affidavit of Evidence where Chetan says in paragraph 6 that the last payment made of Rs. 2 lakhs by Navnitlal was on 31st March 2014 by cheque No. 848916 drawn on the Bank of India, Overseas Branch "for a sum of Rs. 2 lakhs "in part payment of diverse amount lent and advanced by him to the Defendant". This is a categorical assertion compliant with Section 19 of the Limitation Act:Page 18 of 25
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19. Effect of payment on account of debt or of interest on legacy--
Where payment on account of a debt or of interest on a legacy is made before the expiration of the prescribed period by the person liable to pay the debt or legacy or by his agent duly Authorised in this behalf, a fresh period of limitation shall be computed from the time when payment was made:
Provided that, save in the case of payment of interest made before the 1st day of January,1928, an acknowledgment of the payment appears in the hand- writing of, or in a writing signed by the person making the payment.
Explanation--For the purposes of this section,--
(a) Where mortgaged land is in the possession of the mortgage, the receipt of the rent of produce of such land be deemed to be a payment;
(b) "Debt" does not include money payable under a decree or order of a court.
32. Chetan says unequivocally that Rs. 2 lakhs were paid to him in part payment of the aggregate that was due to him on that date. On this, there is no cross-examination at all. There is no explanation about this cheque. There is no suggestion put about this cheque. The cheque itself is not denied. Mr Shah's argument that Chetan was unable to identify the dates on which monies were lend does not I think take us anywhere. The reason is simple. His claim is not for recovery of individual loans but for the aggregate due at the end of a running account between him and his father over a period of time.
Page 19 of 2531st January 2017 & 22nd February 2017 ::: Uploaded on - 22/02/2017 ::: Downloaded on - 23/02/2017 01:03:22 ::: Chetan Shah v Fizza Navnitlal Shah 4-NMS1469-14.DOC This amount was carried forward from year to year shown in mutual records and returns year on year and in respect of which Chetan says that there is partial repayment as recently as 31st March 2012, an assertion on oath that goes completely unchallenged in cross- examination. Consequently Mr Shah's relinace on the decision of a learned Single Judge of this Court in Percy F Fisher v Ardeshir Mormasji Gazdar & Anr1 is of little avail.
33. The reference to Article 26 of the Limitation Act is incorrect. It is not Chetan's case that there was a signed settlement of a standing account. He says that the amounts due to him were acknowledged by Navnitlal in his own accounts, and that there was a part repayment in 2012 that affords him a fresh starting point of limitation. Only because each entry in a running account may at the trial need to be proved does not mean that the entire claim is out of time. It only affects the quantum of the final claim adjudicated if it is found that one or more of the entries in the account are incorrect or not proved. The claim is for the aggregate.
34. There are two critical aspects that Mr Shah's arguments overlook. The first is that between father and son, in the normal course of a family relationship, with the ebb and flow of financial assistance, it is impossible to accept that there was the strict rigidity of back-to-back loans and repayments. The claim is not for recovery of individual loans at all. That is not the frame of the suit, and it is not possible to read or parse the plaint to arrive, by some convoluted reasoning or extrapolation, at this result. The plaint must be read as 1 AIR 1935 Bom 213.
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35. There is no warrant in law or on facts to assume that between son and father there were the kind of discreet, one-off, isolated loans that Mr Shah suggests. Seen as an ordinary relationship between a son and his father, it is impossible to transform this into one between a money-lender and his borrower. The law is not so divorced from reality that it will fail to recognize such a relationship and give it due accord.
36. The second aspect is Fizza's own stand at the trial on the preliminary issue. What is it she did? The answer is this: absolutely nothing. Once Chetan gave his testimony and produced his Page 21 of 25 31st January 2017 & 22nd February 2017 ::: Uploaded on - 22/02/2017 ::: Downloaded on - 23/02/2017 01:03:22 ::: Chetan Shah v Fizza Navnitlal Shah 4-NMS1469-14.DOC documents in evidence, he put in evidence the fact of an ongoing account between him and his father; and, too, of a part repayment in 2012. It is not enough for Fizza only to say that there was some general, non-specific and entirely ambiguous 'falsification' or 'manipulation'. She had no answer to the repayment. She had no answer to Chetan's case that the loans due are shown in Navnitlal's own accounts; specifically, the document shown at Exhibit "A2" to the plaint. While Chetan may not have been able to produce this document, surely it, and its associated documents, were not only in Fizza's power, possession and custody, but they were also within her knowledge. She, being in charge of Navnitlal's accounts, knew what they did or did not say. She knew, or must be deemed to have known, if Navnitlal's cheque of 31st March 2012 was for some purpose other than repayment of a loan. Chetan categorically averred that, to his knowledge, the amounts due to him are shown in Navnitlal's own books. Those are with Fizza, in her power, control and custody. He could not be expected to produce her documents; she certainly could, and had they not shown what Chetan says they do, she would undoubtedly have done so. No one prevented her from leading evidence and putting into evidence financial documents disproving Chetan's assertion, one to which he deposed and which he supported with his own financial documents plus evidence of a cheque repayment.
37. Mr Shah submits that even if the payment of 31st March 2012 is taken to be an acknowledgement of liability, it would, at best, save the claim for a period of three years prior and no further. That may be so; but this is the peculiarity of deciding a question of limitation as a jurisdictional bar -- I must only see if the claim is within time, Page 22 of 25 31st January 2017 & 22nd February 2017 ::: Uploaded on - 22/02/2017 ::: Downloaded on - 23/02/2017 01:03:22 ::: Chetan Shah v Fizza Navnitlal Shah 4-NMS1469-14.DOC not how much of the claim is within time. If I find that prayers (e) and (f ) are in time, then I must hold so, and leave it to the final hearing of the suit, once all the evidence is in, to show what portion of the claim is proved, what is not, how much is within time and how much beyond. Any other approach would result in my having to conduct a full-dress trial at the stage of deciding a preliminary issue. I do hold that the reliefs in prayer (e), and, consequently, prayer (f ) of the plaint are within time.
38. I first dictated this order in open court. Then, while correcting it, and before I signed it, I felt it necessary to have both sides address the question of whether some or all of the reliefs were or were not within time. I placed the matter for directions and heard both sides again.
39. On prayers (a) to (d), which of Articles 58, 65 or 113 might apply? The relevant provisions are set out below.
58. To obtain any other Three years When the right declaration. to sue first accrues.
65. For possession of Twelve years When the immovable property or possession of any interest therein the defendant based on title. becomes adverse to the plaintiff.
113. Any suit for which no Three years When the right period of limitation is to sue accrues.
provided elsewhere in this Schedule.
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40. Mr Sancheti would have it that this is indeed a claim for possession based on title, and time begins to run from the date when the possession of the Defendant is hostile to that of the Plaintiff. That, he says, is the date of the suit because, admittedly, the Plaintiff did not assert title at any time before. I find it impossible to accept this argument. For Article 65 to apply, there must be an assertion of title and its denial. The possession said to be 'adverse' must be actual, open ('notorious'), hostile, exclusive and continuous.2 If Chetan never asserted his title at any time till the suit, and if he now claims (for the first time in this suit) that the properties were bought 'for him' -- that he is the beneficial owner of these properties -- and if the claim is based, as Mr Sancheti insists, on 'adverse possession', then it must be shown that there is, from the Defendants, a denial of the true owner's title. This requires the true owner to assert his title in the first place. Chetan never asserted title, and Article 65 thus has no application to prayers
(a) to (d).
41. On the other hand, if prayers (a) to (d) are covered by Articles 58 or 113, the Plaintiff's starting point of limitation would be from the dates when those properties were purchased, in March and July 2008. Between Articles 58 and 113, the earlier starting point of limitation would be when the right to sue first accrued. The right to sue always arises when the right is asserted and it is first denied. Chetan never asserted his right to title in either the Free Press House or the Lonavla property. Even his demand letters only ask for a return of money; they assert no title.
2 Tribhuvanshankar v Amrutlal, (2014) 2 SCC 788.
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42. The consequence is that the reliefs sought in prayers (a) to (d) are time-barred.
43. In view of the foregoing, the suit is within time as regards prayers (e) and (f ). The issue under Section 9A is answered accordingly.
44. The Defendant's Notice of Motion No. 1469 of 2014 remains pending since there are other reliefs sought as well. This order therefore disposes of only prayer clause (a) of Notice of Motion no. 1469 of 2014. The Plaintiff's Notice of Motion No. 413 of 2015 for interim relief is also pending, though this will now have to be seen in the context of the answer to the preliminary issue. List both Notices of Motion for directions, including as to completion of filings on 28th February 2017 at the end of the supplementary board. On that day, I will also fix a date for final hearing of both Notices of Motion.
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