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P L D 1965 (W. P.) Karachi 69

 

Before Wahiduddin Ahmed and A. S. Faruqui, JJ

 

BANK OF INDIA LTD—-Plaintiffs

 

Versus

 

MUHAMMAD ASHRAF AND OTHERS‑Defendants

 

Reference in Suits Nos. 219 and 220 of 1962, decided on 23rd July 1964.

 

Wor Lee Lone v. A. Rahman A I R 1918 L B 135 (1) and Vithal Krishna Shanbhag v. Sogmal Nathinal & Co. A I R 1958 Bom. 92 ref.

 

P. Ramchandani for Plaintiffs.

 

A. H. Pirzada for Defendants.

 

Dates of hearing: 27th and 28th April 1964.

 

JUDGMENT

 

WAHIDUDDIN AHMED, J.‑—The facts giving rise to this reference may be shortly stated. The Bank of India Ltd. brought two suits bearing Suits Nos. 219 and 220 of 1962 for the recovery of Rs. 2,55,363.40 and Rs. 2,92,756.95 respectively against defendants Nos. 1 to 5 under the summary procedure provided by Order XXXVII, rule 2, C. P. C. Both the suits are upon the Bills of Exchange drawn by defendant No. 5, Messrs East Pakistan Tannery, Chittagong, East Pakistan of which defen dants Nos. 2, 3 and 4 are the partners and accepted by defendant No. 1, another partner of the said firm carrying on business in Karachi. The plaintiff’s case is that defen dant No. 1 without disclosing that he was a partner of defendant No. 5 firm opened two Letters of Credit in the year 1959, in respect of tanned chrome leather goods imported from Chittagong. The plaintiff opened the Letters of Credit through Central Bank of India, Chittagong in substantial amounts which were utilized by defendant No. 5 against the Bills of Exchange drawn by them on defendant No. 1. In spite of acceptance defendant No. 1 did not honour any of the Bill of Exchange. According to the plaintiff, defendant No. 1 in collusion with defendants Nos. 2 to 5 have played a fraud on the Bank, as later on it was discovered that the said goods are of much less value and do not represent the value for which the Letters of Credit and Bill of Exchange were opened and drawn.

 

2. Defendants Nos. 1 to 5 applied under Order XXXVII, rule 3, C. P. C. for leave to appear and defend the suits. Their defence is that the suits are not maintainable under the summary chapter as more than one year has elapsed after the accrual of the cause of action which in the first case arose admittedly on 31st October, 1959 and in the second case arose on 21st October, 1959. This plea was contested on behalf of the plaintiff, who contended that Article 5 of the Limitation Act, which prescribed the period for the summary suits was amended by Ordinance IX of 1961 and a new Article 64‑A has been inserted. This new Article provides a period of three years for a suit under Order XXXVII of the Civil Procedure Code from the date when the debt became payable. The aforesaid Ordinance was promulgated on 4th March, 1961 and was published in the Gazette dated 6th March, 1961. In reply the defendants contended that the cause of action having arisen in the year 1959, the plaintiff could not have brought the two suits under the summary procedure in so far as more than one year had elapsed after the accrual of cause of action. It was urged on their behalf that Article 5 of the Limitation Act as it originally stood was applicable and on the expiry of one year the defendants had acquired a right to resist the claim in the ordinary way without the need of obtaining leave and without the requirement of security. It was further urged that this right could not be defeated by the amending Ordinance which came into force on 6th March, 1961 and which had no retrospective operation. In support of this contention, defendants’ counsel relied upon a judgment of the Bombay High Court in the case of Karbalai Gulam v. Haji Ebrahim Busheri & Co. (A I R 1939 Bom. 342). In that case the suit was instituted under the summary procedure more than one year after the accrual of the cause of action. It was barred under Article 5 of the Limitation Act as it originally stoo6, but it was contended on behalf of the plaintiff that by virtue of the amendment of 15th January, 1938 applicable to Bombay Province a period of three years, as has been done by Ordinance IX of 1961 was prescribed for suit under Ordinance XXXVII, C. P. C. and the summary procedure could be invoked even after the expiry of one year of the date on which the cause of action accrued for the amendment had retrospective effect. This contention was repelled by Engineer, J. on the following observation:—

 

“Where before 15th January 1938, a summary suit instituted more than one year after the accrual of the cause of action is thus barred under Art. 5 as it originally stood, the suit is not revived by the amendment of 15th January 1938 which prescribes a period of three years.”

 

3. On the other hand, the plaintiff relied on an unreported judgment of Qadeeruddin Ahmed, J., in Suit No. 69 of 1961 (Ch Muhammad Din v. Azizur Rehman). In that case the learned Single Judge repelled the contention of the defendants that a right which has extinguished cannot be revived by amendment of law on the ground that no substantive right was extinguished but only the procedure prescribed by Order XXXVII, C. P. C. had ceased to be applicable. It was further observed that Order XXXVII, C. P. C. was merely procedural and the amendment being of the procedural law of the country it was applicable because it was in force at the time of the institution of the suit.

 

4. The question involved being of considerable importance and not free from difficulty has been referred by the learned Single Judge on the Original Side of this Court to a larger Bench under rule 10 of the Chief Court of Sind (O. S.) Rules. It is in these circumstances that this following question has been referred to this Bench for consideration:

 

“Whether in view of the amendment introduced by Ordinance No. IX of 1961 in Article 5 of the Limitation Act and by addition of Article 64‑A to the same Act a summary suit under Order XXXVIII, C. P. C. is competent after the expiry of the period of one year from the date of the accrual of the cause of action and which period of one year had expired before the amendment.”

 

5. The short question for determination, therefore, is whether the period of limitation prescribed by Article 64‑A introduced by Ordinance IX of 1961 would govern the summary suit under Order XXXVII, C. P. C. in a case in which period of one year from the date of the accrual of the cause of action had expired before the introduction of the aforesaid amended Article in the Limitation Act. In order to appreciate this point it is necessary to state certain well established principles of inter pretation of statutes which govern the case arising under the Limitation Act. One of the most important principles is that the period of limitation is ordinarily a matter of procedure only, and that when a question of limitation is raised it ought to be decided in accordance with the law of limitation in force at the time of the institution of the suit and not that in force at the time of the cause of action, unless there be any express provision to the contrary in the Act itself. This view was expressed by Sulaiman, Ag. C. J., in Ram Karan Singh v. Ram Das Singh (A I R 1931 All. 635).

 

In Shahid Ganj v. S. G. P. Committee (A I R 1940 P C 116), this principle was approved. It was observed by their Lordships of the Judi cial Committee that “the rules of limitation which apply to a suit are the rules in force at the date of institution of the suit, limitation being a matter of procedure”.

 

6. Thus on these observations it cannot be doubted that in both the suits the summary procedure provided under B O. XXXVII, C. P. C. can be invoked as these were brought within three years of the accrual of the cause of action, the period prescribed under Article 64‑A. Mr. Abdul Hafeez Pirzada, the learned counsel for the defendants has, however, strongly urged that no statute has retrospective operation unless its language plainly requires it. In support of this contention the learned counsel has relied on a decision of the Privy Council in the case of Colonial Sugar Refining Co. Ltd. v. Irving ((1905) A C 369). But the learned counsel failed to notice that an enactment dealing with procedure is exception to the above rules and as a general rule is retrospective in its operation and governs all proceedings from the moment of its enactment even though the cause of action might have accrued before the Act came into existence. In this connection their Lordships of the Privy Council in the case of Delhi Cloth & General Mills Co. Ltd. v. Income‑tax Commis sioner (A I R 1927 P C 242) observed as under:‑-

 

“While provision of a statute dealing merely with matters of procedure may properly, unless that construction be textually inadmissible, have retrospective effect attributed to them; provisions which touch a right in existence at the passing of the statute are not to be applied retrospectively in the absence of express enactment or necessary intendment. Provisions which, if applied retrospectively, would deprive of their existing finality orders which when the statute came into force, were final, and provisions which touch existing rights.”

 

In other words, the provisions which touch or take away any existing or vested right will not be given a retrospective effect.

 

7. The question, therefore, arises whether in the present ease the defendants can be said to have derived any vested right. In support of this contention the defendants’ counsel has relied on a number of decisions in which it was held that a statute cannot be given a retrospective effect, if it interferes with or impairs or imperils a vested right unless such intention be clearly manifested by expressed words or necessary implication. Reference was made to Messrs Hoosein Kasam Dada Ltd. v. State of Madhya Pradesh (A I R 1953 S C 221); R. M. Seshadri v. Province of Madras (A I R 1954 Mad. 543); Gardhan Das Baldev Das v. The Governor‑General‑in‑Council (A I R 1952 Pb. 103); Sangram Singh v. Election Tribunal Kotah (A I R 1955 S C 425); Asikannessa Bibi v. Dwijendra Krishan Dutta (A I R 1931 Cal. 92); Raghuraj Singh v. Sobhaman (A I R 1951 All. 485) and Batting v. London Passenger Transport Board ((1941) 1 All E R 228). It is unnecessary to discuss these decisions because the principles enunciated in it are well established and cannot be disputed. This, however, does not mean that any one has vested right in the period of limitation. In fact rules of limitation are prima facie rules of procedure and consequently no one has any vested right in the period of limitation unless the contrary is expressed. It was held by their Lordships of the Privy Council in Hurrinath Chetterji v. Mohunt Moothoor Mohun Gosivami (20 IA 183), that the Limitation Act does not create any right in favour of the person but merely prescribes a time for the enforcement of right.

 

8. The learned counsel for the defendants placed strong reliance on section 6 of the General Clauses Act. He urged that the repeal of an enactment shall not revive anything not in force or existing at the time when the repeal takes effect or affect the previous operation or any enactment so repealed. It was contended by him that since on the date when Ordinance IX of 1961, came into force, period of one year had expired the repeal of Article 5 of the Limitation Act by Article 64‑A intro duced by the said Ordinance could not revive the right of the plaintiff to file a suit under the summary chapter which was not in force or existing at that time when the repeal takes effect. In our opinion, the contention of the learned counsel has no force for obvious reasons.

 

9. In the first place this is not one of those cases in which at the time of the Amending Act the right to sue was barred by time. The learned counsel has referred us to the decision of Engineer, J., in Karbalai Gulam v. Haji Ebrahim Busheri & Co. to show that a right to sue under the summary chapter has got the same incidence as an ordinary suit. According to him been in such a case if the right to invoke summary procedure is barred, it cannot be revived by the Amending Act. If this view is accepted, it would mean that the general principle that a statute dealing with procedural law has retrospective operation will become redundant. It seems to us that the paramount considera tion in such cases would always be whether the Amending Act destroys any vested right or cause of action. As observed in Wor Lee Lone v. A. Rahman (AIR 1918 LB 135 (1)), Order XXXVII lays down certain rules of procedure which are applicable only to the Chief Court and such rules of procedure can only be applied after the plaint has been admitted. The rule does not in any way alter the nature of the suit, nor the jurisdiction of the Court. In Vithal Krishna Shanbhag v. Sogmal Nathmal & Co. (AIR 1958 Bom, 92) it was observed that the provisions of Order XXXVII, C. P. C. are procedural only and they are not matters of substantive rights. It was further held that it would be improper to construe the provisions of Order XXXVII. Civil Procedure Code as negative or superseding the right of a debtor under the Bombay Money‑Lenders Act, 1946, to present an application under section 30. It is, therefore, quite obvious that Order XXXVIL C. P. C. only provides a summary remedy to a plaintiff. These provisions are only of procedural nature and an option is given to him to seek speedy remedy. If he fails to exercise this option, it would not debar hint from filing the suit in the ordinary manner provided it is brought within the period prescribed under the Limitation Act.

 

10. It is perfectly clear that it is not one of those cases in which the plaintiffs had lost their right to recover the debt from the defendants. At the time of the institution of the suit even under the unamended Act their claim was within time and there is no dispute on that point. The amendment has only enabled them to seek the speedy remedy within a longer period and introduces a change only in procedure. In our opinion with great respect it will be too much to hold that the summary pro cedure provided by Order XXXVII, C. P. C. has created any sub stantive or vested right in favour of the defendants for it is solely for the benefit of the plaintiff’. There is not the slightest doubt that the Amending Act has not in any way curtailed any existing right of the defendants. We find no force in defendants counsel’s contention that the defendants had unlimited right to defend the claim. It is always subject to procedural law. In these circumstances the provision o G section 6 of the General Clause Act has no application to the present case. In Soni Ram v. Kanhaiya Lal (40 IA 74) one of the contentions raised before the Privy Council was that the Limita tion Act application to the case was Act XIV of 1859, any, there fore, the acknowledgments of the existence of certain mortgages of 1842 which were contained m some deeds executed by Mst. Jamna and Mst. Janki the two Hindu ladies was sufficient to keep the right alive. In this decision their Lordships approved the view of the High Court that the law of limitation applicable to a suit or proceedings is the law in force at the time of the institution of suit or proceeding, unless there is a distinct provi sion to the contrary on the following observation:‑–

 

“As to that contention it is sufficient for their Lordships to say that they agree with the High Court that Act XIV of 1859, does not apply to this suit and that the Limitation Act which does apply is Act XV of 1877, and further that the acknow ledgments which were made by Mst. Jamna and Mst. Janki were not acknowledgments within the meaning of section 19 of Act XV of 1877, made by a person or persons through whom the defendants derived title or liability.”

 

It, therefore, appears to us that in a case where the right of the plaintiff to recover that debt had not become barred at the time when the amended Act was enforced, a procedural change in the period of limitation prescribed for summary suit cannot be considered to be affecting any vested right so as to attract the principles recognised in section 6 of the General Clauses Act. With great respect in the Bombay case this aspect of the case was not brought to the notice of the learned Judge and we do not consider that that decision has laid down correct law.

 

11. Mr. Hafeez Pirzada, the learned counsel for the defen dants has further referred us to certain decisions on the question of limitation. Reference may be made to Pearey Lan v. Solu Gir (A I R 1946 All. 58) ; Appasami Odayar v. Subramanya Odayar (15 I A 167); Muhammad Bit? Salem v. Umaji (A I R 1955 Hyd. 113) and Nur Muhammad v. Zafar Ali (P L D 1952 Lah. 245). But none of them deal with the point under consideration. These cases are distinguishable because most of them deal with cases where the right to sue has become barred.

 

12. On the other hand Mr. Persi Ramchandani learned counsel has also placed reliance on certain decisions namely Chotmal Ganeshram Bhardia v. Messrs Ramchand Tarachand (A I R 1958 Bom. 137) Attorney‑General v. Vernazza ((1960) 3 All E R 97 at p. 100) and Mackillican v. The Compagnie Des Messageries Maritimes De France (I L R 6 Cal. 227, 237), in which a contrary view is taken. On the view taken in these decisions the learned counsel contended that if a plaintiff can enforce his claim for the recovery of debt against a defendant the fact that he can do so under one procedure or the other is purely a question of procedure. According to him any change in the period of limitation for invoking this procedure cannot be considered to be effecting any vested right or reviving a right which did not exist. The contention of the learned counsel as discussed above is not without force and seems to be correct.

 

13. In view of the above discussion we are in agreement with the view taken by Qadeeruddin Ahmed, J. We would, therefore, hold that the plaintiff was competent to bring the suit under the summary chapter under the amended provision of the Limitation Act namely Article 64‑A and the objection of the defendants is, therefore, repelled.

 

K. B. A. Reference answered.

 

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