Mushtaq Ahmad, J.:— This is a plaintiff's application in revision against a decree of a Small Cause Court Judge, dismissing his suit for recovery of arrears of pay and certain other amounts. The applicant was in the employ of the Municipal Board, Kanpur, at a monthly salary of Rs. 50, in charge of looking after the Board's cases in various courts. He was suspended from service on the 2nd September, 1941, and, later on, prosecuted in two cases for misappropriation of funds. In one he was acquitted on the 4th January, and in the other discharged on the 1st February, 1943. He was then re-instated on the 7th March, 1943: but departmental proceedings being taken against him, he was dismissed from sendee on the 22nd December, 1943. When re-instated, he was not paid the remaining ¾ths of his salary for the period of his suspension, 2nd September, 1941 to 7th March, 1943, only ¼th being paid to him during the interval as a subsistence allowance. He served a notice on the Board on the 21st October, 1944, asking for the arrears of his pay at the rate of Rs. 37-8 per month, some dearness allowance and the Board's contribution to his Provident Fund Account of the said period. This being refused, he filed the suit on the 22nd December, 1944.
Among other defences, the Board resisted the claim, by a plea of limitation, which was accepted by the court below, and, in the result, the suit was dismissed. This is the only point to be decided in this revision.
The answer to the question whether or not the suit was time-barred depends on whether it was governed by section 326 of the United Provinces Municipalities Act (II of 1916), providing a six months' rule of limitation, or by the relevant provisions of the Indian Limitation Act, providing a three years' period. The former section, omitting unnecessary words, lays down:
“No suit against a Board in respect of an act done or purporting to have been done in its official capacity shall be commenced otherwise than within six months next after the accrual of the cause of action.”
One of the questions before the court below was whether the cause of action had arisen on the 7th March, 1943, when the applicant was re-instated or on the date when his demand for payment of the arrears of salary was refused. There is no difficulty in answering this question, as it must be taken that the cause of action had really arisen on the earlier date. The real question is whether the suit should have been brought within six months of the accrual of the cause of action, as required by section 326 of the Municipalities Act, or whether it could be filed within the larger period allowed by the Limitation Act. On this, I find a considerable divergence of opinion in this Court, and it is necessary that the matter be finally determined by a larger Bench.
Before I set out the various rulings to indicate the conflict, I may just mention that there is a material difference between the language of section 73 of the Municipalities Act XV of 1873 and that of section 326 of the present Municipalities Act; while the former provided for a suit inrespect of any act done or purporting to have been done “in pursuance of the Act”, the latter refers, as I have already said, to a suit against a municipal board in respect of an act done or purporting to have been done “in its official capacity”. section 273 of the Cantonments Act II of 1924 and section 192 of the United Provinces District Boards Act X of 1922 also have the words; shown by me within inverted comas, of section 73 of the Municipalities Act XV of 1873 but not section 326 of the present Municipalities Act. In various cases decided by the courts in this country, a question arose whether a claim based on a contract entered into by a board could be said to be one in respect of an act done by it in pursuance of a particular Act, the Municipalities Act, the Cantonments Act, or the District Boards Act, and the consensus of opinion seems to be that it could not be so regarded. The words “in pursuance of the Act” having now been replaced by the words. “done in its official capacity”, the question arises whether a claim of the nature filed by the present applicant could be said to be one in respect of an act done or omitted to have been done by the opposite-party in its official capacity. I would now indicate the conflict to which I have referred.
In the following cases, noted chronologically, it was held that the restricted period of limitation provided by the local Act did not apply, but that the suit was governed by the general law of limitation:
(1) District Local Board of Poona v. Vishnu Raghoba Wadherkar(1)—Suit for damages for breach of a building contract. Section 136 of the Bombay Local Boards Act was held inapplicable.
(2) Municipal Board Agra v. Ram Kishen(2) (Mukerji and Bennet, JJ.)—Suit for money for work done on contract.
(3) Cantonment Board, Allahabad v. Hazarilal Gangaprasad (Sulaiman, C.J and Mukerji, J.)—Suit for recovery of value of goods supplied. Section 273(1), Cantonments Act, held inapplicable.
(4) District Board, Allahabad v. Bihari Lal (Sulaiman, C.J, Niamat Ullah and Bennet, JJ.)—Suit for refund of a security deposit and for money for extra work done. Section 192(1), District Boards Act, held inapplicable.
(5) Ram Narain v. Municipal Board, Muttra(3) (Harries and Misra, JJ.)—Suit for work done under a contract.
(6) Jagan Nath v. Municipal Board, Soron(4) (Bennet and Verma, JJ.)—Suit for declaration that certain bye-law are illegal.
(7) Municipal Borough of Ahmadabad v. Jayantilal Chhotalal Patel(5)—An act done by a municipal board under a contract is not “in pursuance of the Act”.
In some of the above cases, for instance in the last but one, Jagannath v. Municipal Board, Soron, it was emphasised that the word “act” in section 326 of the United Provinces Municipalities Act referred only to a “tortuous” act and not to one based on or done in respect of a contract.
A contrary view was taken in the following cases, also chronologically noted, namely that section 326 of the United Provinces Municipalities Act and not the general law in the Limitation Act applied:
(1) Abdul Waheed v. Municipal Board, Allahabad(6) (Mears, C.J and Banerji, J.)—The suit was for money for work done on contract.
(2) Banwari Lal v. Municipal Board, Kanpur (Daniels, J.) The suit was for arrears of pay. The learned Judge followed the last case.
(3) Municipal Board, Lucknow v. Debi Das—A case of contract.
(4) Jaggan Nath Bhagwan Das v. Municipal Board, Allahabad (Mukerji and Sen, JJ.)—A suit for refund of octroi duty.
(5) Munir Khan v. Municipal Board, Allahabad. (Niamat Ullah and Sen, JJ.)—A suit for money for work done.
(6) Municipal Board, Lucknow v. S.C Deb—A case of contract.
(7) Rebati Mohan Das v. Jateendra Mohan Ghosh—A case under section 80, Civil Procedure Code, in which also, as in section 326 of the United Provinces Municipalities Act, the words “in respect of any act purporting to be done by such public officer in his official capacity” occur.
(8) Municipal Board, Lucknow v. Aziz Husain(7)—A case of contract of service.
If it were not for a parenthetical remark in the judgment of the Judicial Committee in the last but one case, it would perhaps have been admissible to hold that the weight of authority, as above set out, was in favour of the view that section 326 of the United Provinces Municipalities Act prescribing a shorter period of limitation did not apply to claims based on contracts but was confined only to claims arising out of “tortious” acts of a municipal Board. In that case, the trial court had held that section 80, Civil Procedure Code, had no application to suits in contract, but Sir George Lowndes, delivering, the judgment of the Committee, remarked that—
“This dictum was rightly repelled by Mukerji, J.”.
If the words “act done in an official capacity” in section 80, Civil Procedure Code, did cover “suits in contract”, they in section 326 of the United Provinces Municipalities Act, would also, by parity of reasoning, cover such suits, and if this is so, the view taken in the cases of the first list given by me was among and that taken in those of the second was right.
Two anachronisms, however, present themselves, to my mind, which call for an authoritative solution. One that the last four cases of the first list were decided after the Privy Council case, but in none of them the remark quoted by me from its judgment appears to have been invoked in aid of the view that the shorter period of limitation applied also to suits based on contract. The other is that Mukerji, J., was a party to each of the decisions, Jagannath Bhagwan Das v. Municipal Board Allahabad Municipal Board, Agra v. Ram Kishan, noted by me, and similarly Niamat Ullah, J., was a party to each of the decisions, Munir Khan v. Municipal Board, Allahabad and District Board Allahabad v. Beharilal of the said lists respectively.
In this state of the case-law bearing on the paint, it is not possible for this Bench to decide the present case without dissenting from the cases, either of the first or of the second category, and I would, therefore, refer it to the Hon'ble the Chief Justice for constituting a Full Bench for a decision of the following question:
Whether the suit in the present case was governed by section 326 of the United Provinces Municipalities Act or by the Indian Limitation Act.
Desai, J.:— If the applicant's case is governed by the ordinary law contained in the Limitation Act, his suit would be within time even when the period of limitation is computed from 7th March, 1943 or 1st April, 1943. But if it is governed by the six months rule of limitation contained in sub-section (3) of section 326 of the Municiparties Act, it would admittedly be barred by time when the period is computed from 7th March, 1943 or 1st April, 1943. It is true that the applicant's suit is based on a contract of service. He is entitled to whatever is due to him under the contract of service. But the words of section 326(3) are wide enough to cover every cause of action regardless of its nature. There are no words in the sub-section to suggest that it applies only to a suit based on a tortuous act. There is nothing to qualify the word “suit” in sub-section (1) except the words “in respect of an act done….official capacity”. If a suit based on’ contract is “in respect of an act done… official capacity”, it is a suit fully covered by the provisions of sub-sections (1) and (3). If what is done or what is not done by a board does not amount to “an act done”, let the court not apply the provision of sub-section (3) to the case. If what a board has, or has not, done is not done in its official capacity let the court again not apply the provision to the case. But if what a board has, or has not, done is “an act done… official capacity”, then I do not know what justification there can be for refusing to apply the provision except that the court wants to repeal it to say that a suit against a board for “an act done… official capacity” must be based on tort and not contract is to read words which do not find place in the section—clearly a matter beyond a court's power. Viscount Summer stated in Bhagchand v. The Secretary of State for India:
“Section 80 is express, explicit and mandatory and it admits of no implications or exceptions. A suit in which inter alia an injunction is prayed is still ‘a suit’ within the words of the section, then to read any qualification into it is an encroachment on the function of legislation”.
What his Lordship said about section 80. Civil Procedure Code, can be said with equal force about section 326, Municipalities Act.
Section 326 has been applied by this Court in cases of contract, not only of service but also of supply of goods or to carry out works. Abdul Wahid v. The Municipal Board Allahabad was a case of a contract to carry out certain work entered into by Abdul Wahid with a municipal boad. His suit to recover the price of the work done was held governed by section 326. In Banwari Lal v. Municipal Board, Kanpur, he sued to recover the at rears of his salary; but did not even pretend that the suit was not governed by section 326. In Rebati Mohan Das v. Jateendra Mohan Ghosh, the Judicial Committee had to deal with section 80, Civil Procedure Code which requires a notice of a suit to be instituted
“in respect of an act purporting to be done by such public officer in his official capacity.”
Sir George Lowndes, delivering the judgment of the Judicial Committee, observed at p. 475:
“The learned Subordinate Judge held that the section had no application to suits in contract and this dictum was rightly repelled by Mukerji, J., who delivered the judgment of the High Court. Having regard to the decision of this Board in Bhagchand v. The Secretary of State, their Lordships think that no such distinction is possible. …. Their Lordships do not suggest that a claim based upon a breach of contract by a public officer may not in many cases be sufficient to entitle him to notice under the section.”
The Chief Court of Lucknow had consistently applied section 826 to all cases of contract; see Municipal Board Lucknow v. Debi Das, Municipal Board, Lucknow v. S.C Deb, and Municipal Board Lucknow v. Aziz Husain. The first two were cases of contract for the supply of goods, and the third was a case of contract of service.
The view that section 326 applies to a suit based on tort and not on contract seems to be a legacy of the old days when the corresponding provision in the Municipal Act contained the words “for anything done or purporting to be done in pursuance of the Act”. It was then held that a breach of a contract entered into by a board was not an act “done or purporting to have been done in pursuance of the Act”. Even if a board is permitted by the Act to enter into contracts, it may not be said that it entered into a particular contract “in pursuance of the Act”. Even if it is possible to say this, when it omits to do an act by committing a breach of its obligation under the contract it is not possible to say that it committed the act of omission “in pursuance of the Act”. It was pointed out in Sharpington v. Fulham Guardians that although the general duty of a board makes it intra vires to do so, there is no duty to enter into a particular contract and that the mere fact that a contract was within the power of the Board does not render the breach of it anything more than a breach of the private duty to the individual contractor arising out of the terms of the contract. The Act may require certain duties to be performed by a board, but does not insist upon those duties being performed through a contractor. The making of a contract by a board cannot be said to be in pursuance of the Act, though it is certainly within its power: So when a person sued a cantonment board for the price of goods supplied to it, his suit was held to be not governed by section 273 of the Cantonments Act which uses the words—
“any act done or purporting to have been done in pursuance of this Act;”
see Cantonment Board v. Hatari Lal Ganga Prasad. Bennet and Mukerjee, JJ., have discussed the meaning of “any thing done or purporting to have been done in pursuance of the Act” in Municipal Board, Agra v. Ram Kishen. The words were recently interpreted by a Full Bench of the High Court of Bombay in the Municipal Borough of Ahmadabad v. Jayantilal Chhotalal Patel. The Municipal Board of Ahmadabad entered into a contract with Jayantilal for the purpose of street cleaning and Jayantilal gave a deposit. Later, disputes arose between the parties and the Board forfeited the deposit. Jayantilal sued for its recovery more than eight months after the Board's act but within three years. The suit was held by the Full Bench to be within time according to the ordinary rule of limitation. The Full Bench observed that it was no part of the Board's duty to enter into any contract. With respect to the learned Judges I considered that those cases were correctly decided. But the words that we have to construe are not “an act done or purporting to have been done in pursuance of the Act”, but “an act done… official capacity”. Though the learned Judges were inclined to take the contrary view in the Municipal Board, Agra v. Ram Kishen I am strongly inclined to the view that there is a material difference between the two sets of words. Sulaiman, C.J, stressed the difference between the two sets of words in Cantonment Board, Allahabad v. Hazarilal Gangaprasad and did not consider the decisions interpreting the words of section 326, Municipalites Act, as directly in point when interpreting the words of the Cantonments Act. In the Municipal Act of 1873 which was in force in U.P in old days the words were “in pursuance of the Act”. The Legislature has thought fit to give up those words and use other words in the present Act. This itself shows that there is a difference between the two sets of words, and that the meaning that is given to one set cannot always be given to the other set.
The view of the Bench in the case of Municipal Board, Agra, that section 326 does not contemplate a suit based on contract, requires, in my opinion, reconsideration. The view is not based on any interpretation of the words used in the section. The intention behind the Legislature's changing the language of section 326 may not be to bring a case based on contract under the section but if such a case does come, it is not open to a court to ignore the language of the section on the ground of the supposed intention of the Legislature. section 192 of the District Boards Act, which contains the same words as section 326 of the Municipalities Act, was considered by a Full Bench of this Court in District Board, Allahabad v. Behari Lal. Sulaiman, C.J, with whom the other Judges agreed, based his decision upon Revati Mohan Das v. Jateendra Mohan Ghosh and yet decided that a claim brought by the other contracting party to recover the money due to him on “a private contract” with the Board would not be governed by section 192, District Boards Act. I confess my inability to find anything in Revati Mohan Das's case to support this decision. Sulaiman, C.J, also thought it difficult to hold that a mere omission to perform a private contract amounts to an act” within the meaning of section 192, District Boards Act. I am prepared to hold that there is distinction between a private contract entered into by a board and another kind of contract entered into by it, but I should not be understood to lay down that section 326, Municipalities Act, recognises any distinction: between a private contract and any other kind of contract any more than that between a suit based on contract, and a suit based on tort. We are not called upon to decide whether the District Board, Allahabad v. Behari Lal was correctly decided or not; it is sufficient for our purpose to distinguish that case. A contract for the purchase of moram entered into by a board, as was the contract in that case cannot be likened to a contract for service entered into by a board under its statutory powers. I do not know what exactly is meant by “a private contract” but if it means a contract which a board enters into for the better performance of its duties and not in compliance with a statutory requirement, a contract of service entered into by a board in compliance with a statutory requirement cannot be said to be “a private contract” Section 71 of the Municipalities Act authorises a board: to determine what servants are required by a board for performance of its duties. Rules 85 to 88 of the Municipal Account Code deal with salary bills and payment of salaries. It is the duty of the Board itself to draw the salaries of the Municipal Establishment. Rule 87 states that—
“when the pay-bill has been drawn the money shall be promptly disbursed to the payees concerned and their receipts taken on the last column of the bill.”
The Board was require by section 71 to enter into a contract of service with the applicant and was bound, in the discharge of its official duties, to pay his salary. I do not think such a contract can be said to be “a private contract” whatever the words mean.
All that we have to see in order to apply section 526, Municipalities Act, to the present case is whether the applicant's suit was one “in respect of an act done … official capacity”. The act of which the applicant has complained is that of withholding three-fourths of his pay for the period of suspension. Act cording to the applicant the Board was bound to pay him this money when it reinstated him but it did not pay it. The word “act” includes illegal omission when used with reference to a civil wrong; see U.P General Clauses Act. Wrongful non-payment of a salary is a civil wrong. In Revati Mohan Das's case the question was of omission by a Manager of Court of Wards to pay the money due on a mortgage executed by him. Their Lordships held that the non-payment did not amount to illegal omission and also that the omission could not be said to be an act purporting to be done by the Manager in his official capacity. The omission could not be said to be illegal because the mortgage imposed no personal liability upon the Manager, the mortgagee's remedy in the event of non-payment was to realise his dues by sale through the Court, and the Manager had an option to pay in order to avert the sale but was under no duty to pay. A board which engages servants under its statutory powers is under a duty to pay their salaries. Its liability in this respect is not similar to that of a mortgagor to pay his mortgagee. The omission to pay the money due under a mortgage may not be an illegal omission, but the omission to pay the salary of a servant is an illegal omission. In the Lucknow cases to which we have referred, the omission to pay the money due under any contract was held to be “an act” within the meaning of section 326. In District Board, Allahabad v. Behari Lal, Sulaiman, C.J, felt dificulty in holding that the word “act” includes all cases of omission to perform a private contract because,
“damages for breach of contract are based on contractual liability, whereas the claims based on tort are based on wrongful action of defendant and an infringement of the plaintiff's right.”
The learned Chief Justice treated the contract there as a private contract, whereas the contract here is not a private contract. Further, the liability of the Board to pay its servants is recognised by the Municipal Account Code referred to above. So the liability of the Board, is more than a liability under a private contract. In Jagannath v. Municipal Board, Soron, and Commissioner of Buxar Municipality v. Bkagioan Das, the word “act” was held to refer to tortuous acts and not to acts arising out of a contractual or quasi-contractual basis. In the former case the cause of action was found to be a recurring one and in that view of the matter it was immaterial whether the act complained of was a tortuous act or not; the suit was not barred by time even if section 326 applied. In Abdul Wahid's case Grimwood Mears, C.J said at p. 162:
“The refusal by the Board was determination by a certain gentleman sitting as a board in a matter which concerned the finances of the Board; which concerned the proper carrying out of the duties of the Board and cannot be otherwise described than as an “official act”.
So in the present case also the withholding of the balance of the applicant's salary was an official act.
The applicant's suit seems to be covered by the words of section 326 and barred by time. But I agree with my brother Mushtaq Ahmad, J., that an authoritative decision is called for and concur in the order proposed.
By the court:— Let the case be placed before the Hon'ble the Chief Justice for being referred to a larger Bench.
[The case was then laid before the Full Bench.]
Shambhu Prasad for the applicant.
Lachmi Saran for the opposite-party.
The judgment of the Court was delivered by—
B. Malik, C.J:— The plaintiff was an employee of the Muncipal Board. He was appointed by the Municipal Board in the grade of Rs. 30-2-50 on an initial salary of Rs. 40 on 17th June, 1931. On 16th June, 1932, he was confirmed in his post and the duties assigned to him were to look after the cases in courts of law on behalf of the Board. In June, 1936, he was drawing a salary of Rs. 50 which salary he continued to draw till the 2nd September, 1941, when he was suspended on certain charges. On 4th January, 1943, he was acquitted of one charge and on 1st February, 1943, he was discharged of the other charge. On 7th March, 1943, he was reinstated but the Commissioner raised certain objections and ultimately on 22nd December, 1943, the Board terminated his service and dismissed him. The plaintiff filed a suit on 22nd December, 1944, claiming that, on his reinstatement in 1943 he became entitled to get his Full salary for the period during which he was under suspension, i.e from 2nd September, 1941 to 7th March, 1943. The suit was brought against the Kanpur Municipal Board through its Chairman.
The Board took various objections. One of the pleas, raised on behalf of the Board, was that the suit was barred by limitation. The provision relied on by the Board was section 326 of the United Provinces Municipalities Act (no. II of 1916). The relevant portion of section 326 is as follows:
“No suit shall be instituted against a board, or against a member, officer or servant of a board, in respect of an act done or purporting to have been done in its … official capacity, until the expiration of two months next after notice in writing has been, in the case of a board, left at its office, … explicitly stating the cause of action, the nature of the relief sought, the amount of compensation claimed, and the name and place of abode of the intending plaintiff … (2) … (3) No action such as is described in sub-section (1) shall, unless it is an action for the recovery of immovable property or for a declaration of title thereto, be commenced otherwise than within six months next after the accrual of the cause of action”.
The learned Judge of the Court of Small Causes held in favour of the Board on this point and also on another point that was raised on its behalf, and dismissed the suit.
A civil revision under section 25 of the Court of Small Causes was filed in this Court which came up before a learned single Judge who referred it to a bench. The following question “whether the suit in the present case was governed by section 326 of the United Provinces Municipalities Act or by the Indian Limitation Act” was referred by the Bench to larger Bench for decision and that is the only point with which we are concerned. It is, therefore, not necessary for us to go into the question as to the date when the cause of action, if any, arose in plaintiff's favour and whether he was at all entitled to claim his full salary during the period of suspension.
The point, therefore, for consideration is whether the refusal of the Board to pay to the plaintiff the whole of his salary during the period of his suspension was an act done in its official capacity and whether the suit is of the nature contemplated by the section.
As regards the first point, we may refer to section 4(2) of the United Provinces General Clauses Act which provides that words which refer to “acts done” extend also to “illegal omissions”. It, therefore, follows that if the Board refused to make payment to its servant it had clone “an act”. The question is whether this act was done by it in its official capacity. Learned counsel has contended that this was not an act by the Board in its official capacity but it was merely its contractual obligation which the Board was required to fulfil when it was asked to pay to the plaintiff the whole of the salary due for the period during which he was under suspension. The argument is that section 326 of the Municipalities Act applies to cases of tort and not to cases of contract and the Board was under no obligation under the Municipalities Act to appoint the plaintiff or to pay his full salary so that if no payment was made there was no breach of any statutory obligation but a breach merely of a contractual liability. In the North-Western Provinces and Oudh Municipalities Act (no. XV of 1873), section 43 provided that—
“No suit shall be brought against a committee or any of their officers, or any person acting under their direction, for anything done under this Act.
This section was, however, amended and in the North-Western Provinces and Oudh Municipalities Act (no. 1 of 1900) the words in section 49 were—
“any act purporting to be done in its or his official capacity”.
The words to the same effect have been repeated in section 526 of the present Act. An act, therefore, done or purporting to be done in the official capacity of the Board or by a member or servant of the board is covered by the section. The section does not require that the act must in fact be done under the Act. Even if it purports to be done under the Act, the section covers it. The United Provinces Municipalities Act provides for appointment of servants by the Board Certain special types of servants, the Executive Officers and others, are specifically dealt with, but section 71 is the general section which gives the right to a board to determine what servants are required for the discharge of the duties of the Board and the salaries to be paid to them. Apart from those for whom special provision has been made by sections 57, 66, 68 and 70 the Executive Officer has been given the power to appoint a servant drawing monthly salary not exceeding Rs. 40 or in a city Rs. 50. The power of punishment and dismissal are provided for in section 76 and section 77 gives the Municipal Board power to make rules about appointment and dismissal of servants. It was in the exercise of the powers given under those sections that the Executive Officer must have appointed the plaintiff and passed the order of suspension and dismissal.
Learned counsel admits that the appointment of the plaintiff by the Board was in the discharge of its official duties. This is obvious. The Board has to perform its official functions and for the discharge of its duties it needed the necessary staff. In appointing or suspending or dismissing the staff in accordance with the provisions of the Act and the rules thereunder the Board or the Chairman or the Executive Officer must be deemed to be discharging their official functions. The argument, however, is that the withholding of a part of the salary was not in discharge of the Board's duties but amounts to a breach of contract and that section 326 applies merely to a case of tort and not to a case of contract. When the Board appoints a servant it is for it to decide on what terms the servant shall be appointed, what salary he would get and, in case his work is found to be unsatisfactory, it must have power to award punishment. Generally rules and bye-laws are made for the purpose and section 77 gives the Municipal Board power to make such rules. It is in the exercise of the functions of the Board, therefore, that it held that the applicant must be dismissed and that he was not entitled to get his full salary for the period during which he was under suspension. We fail to see how the withholding of the salary can be anything but an official act.
As regards the second contention that it is only a suit on tort, that is contemplated by section 326, no doubt there are observations in several judgments of this Court to that effect. Learned counsel has relied on the cases of the Municipal Board, Agra v. Ram Kishan Ram Narain v. Municipal Board, Muttra and Jagannath v. Municipal Board, Soron. In the cases cited by us above no special reason was given for holding that the section contemplated only an action in tort and not an action in contract. The reliance placed by learned counsel is on the words that in the notice given to the Board the plaintiff must explicitly state the cause of action, the nature of relief sought, the amount of compensation claimed, etc. It is said that the amount of compensation can be claimed only in a case of tort and not in any other type of action. Compensation or damage can, however, be claimed also in certain cases of breaches of contract. The fact that there is no basis for this submission is clear when we consider sub-section (4) of section 326. Sub-section (4) provides that—
“nothing in sub-section (1) shall be construed to apply to a suit wherein the only relief claimed is an injunction of which the object would be defeated by the giving of the notice or the postponment of the commencement of the suit or proceeding.”
The section, therefore, does contemplate a suit in which a plaintiff claims only a relief for an injunction and does not claim any amount as compensation. The words relied on by learned counsel obviously mean that, in case compensation is claimed, the plaintiff should mention the amount thereof so that the Municipal Board might know what exactly is the amount of the claim and be able to decide whether it would not like to settle the claim out of court. The point was carefully considered by a Bench of this Court in Munir Khan v. Municipal Board, Allahabad with whose opinion we respectfully agree. It was said—
“The plaintiff contends that the scope of clause (1) is confined to suits for compensation for wrongful acts on the part of the Municipal Board or of its member, officer or servant and that the words ‘act done’ should be construed as wrongful or tortuous act sounding in damages. An examination, of the language of clause (1) does not lend itself to the interpretation which is sought to be put upon it. The clause provides that the notice must explicity state the cause of action, the nature of the relief sought and the amount of compensation claimed. The scope of the suits has not been confined to suits for damages founded upon tort. No limitation has been put either as to the nature of the cause of action or as to the nature of the relief claimed. Clause (4) clearly indicates that the relief claimed under clause (1) may be one for an injunction … the words “cause of action are of sufficient amplitude to cover cases involving the infraction an absolute right or of a right arising out of a contract and also of a right to compensation flowing from tort.”
The observations of their Lordships of the Judicial Committee in Rebati Mohan Das v. Jateendra Mohan Ghosh are also helpful. In that case their Lordships said that
“They do not suggest that a claim based upon a breach of contract by a public officer may not in many cases be sufficient to entitle him to notice under the section…”
No doubt that decision related to a case in which notice under section 80 of the Code of Civil Procedure had to be given but the language of section 80, C.P.C and section 326 of the Municipalities Act so far as relevant to this matter are similar. In the case before their Lordships a manager of the Court of Wards had borrowed money from a third person on a mortgage of his ward's property. In the mortgage deed it was clearly stipulated that the mortgagee's only remedy would be a sale of the property mortgaged. The mortgagee filed a suit for sale on the basis of the mortgage without giving a notice under section 80 of the Code of Civil Procedure. Their Lordships, held that no notice under section 80 was requfred as the suit was not with respect to any act purporting to be done by the manager. Their Lordships said that—
“The manager for the time being no doubt had an option to pay in order to save the sale, but failure to exercise an option is not in any sense a breach of duty.”
The question here arises whether the failure of the Board to pay does or does not amount to a breach of duty. Unless the amount is payable to the plaintiff by the Board the plaintiff cannot get a decree for the amount. The plaintiff claims that the Board was under an obligation to pay the amount to the plaintiff. The Board was called upon to decide this matter, as it was in charge of public funds and it had to decide in the discharge of its official duty whether the amount was payable by it or not, and if it decided that the amount was not payable by it then in view of section 4(2) of the United Provinces General Clauses Act the decision not to pay is “an act” done by the Board in its official capacity.
The only decision in plaintiff's favour on the point is The District Board, Mainpuri v. Devendra Nath but the point was not urged there before the learned Judge and the decision is, therefore, not helpful. A contrary view has however, been taken in the following cases:
Banwari Lal v. Municipal Board, Cawnpore.
Municipal Board, Lucknow v. Aziz Husain.
Learned counsel has placed great reliance on the case of District Board, Allahabad v. Behari Lal. That was a suit filed by a contractor for refund of a deposit made by him as security for the price of certain moram supplied and for payment of certain extra work done. It is not for us to consider whether on the facts of that case the Full Bench was right in holding that section 192 of the District Boards Act did not apply to the case. We must, however, mention with great respect that we have not been able to understand how reliance could be placed by the Bench on the decision of their Lordships of the Judicial Committee in Rebati Mohan Das's case in support of the View that section 192 of the District Boards Act did not apply to the facts of the case before the Full Bench.
The result, therefore, is that in our view the suit in the present case was governed by section 326 of the Municipalities Act.
The case may now be sent back to the Bench for decision according to law.
[On receipt of the opinion of the Full Bench the case was again laid before the original Bench who passed the following order]
Mushtaq Ahmad, J.:— The facts of this case were stated by us in our orders referring the case to a Full Bench for a decision of the question of limitation raised by the defendant-opposite-party. The answer received is that the shorter period of limitation provided by section 326 of the United Provinces Municipalities Act 11 of 1916 and not any other rule applies. That being so, the suit should have been brought within six months of the date of the accural of the cause of action. If it is found to have been brought after that period from such a date, it must be held to be barred by limitation.
The question about the date on which the cause of action had actually arisen was not referred to the Full Bench, presumably because there appears to have been no contest between the parties on that question before. Learned counsel for the plaintiff-applicant has now contended that, even if the shorter period of limitation provided by section 3 of the Municipalities Act applied the claim was within time, inasmuch as the cause of action had accrued within six months from the date of the suit. He treats as the date of the accrual of the case of action the 23rd June, 1944, when the plaintiff's demand for payment of his unpaid, salary was alleged to have been refused, by the opposite-party. In our seperate orders making a reference to the Full Bench we remarked, that the only question in controversy between the parties was with regard to the precise rule of limitation applicable to the case. We even said that the cause of action in this case had obviously arisen either, on the date on which the applicant had been acquitted and discharged, respectively in the two cases or on the subsequent date of the 7th March, 1943, when he had been reinstated, in service. That meant that the suit had been filed obviously more than six months from the date of the accrual of the cause of action and was thus time-barred. In deference to the argument of the learned, counsel for the applicant today that the cause of action had really arisen on the 23rd June, 1944, when the opposite-party refused to pay the arrears of salary to the plaintiff, we have gone into the question again but reached the same conclusion, namely that it had arisen much earlier on all or any one of the three dates we have already mentioned. Learned counsel has cited to us the case of Gopal Das v. Jugal Kishore in support of the contention that the cause of action in a case like this always begins on the date of the defendant's refusal to pay and not on any other date. That was a case in which the relief was for damages by a dismissed Police Sub-Inspector. There was no claim for arrears of salary at all. This, in our opinion, distinguishes that case and does not affect the view which we are inclined to take. In any case that decision is no authority for the proposition that a demand and a refusal to comply with it form parts of the cause of action on which a claim for money can be laid.
A simple approach to the determination of the question is furnished by the consideration that, if after his acquittal in one case on the 4th January, 1943 and discharge in the other on the 1st February, 1943 or even after his re-instatement on the 7th March, 1943, the plaintiff had brought the present suit within six months, the suit surely could not have been held as without any cause of action. We put it to the learned counsel for the applicant, but he was not prepared to suggest that such a suit could have been successful defended on the score of want of a cause of action. If there was a cause of action for a suit brought within such a period, surely there was some rule of limitation also running against the plaintiff who had to bring the suit before the prescribed period expired.
In every view of the matter, we are of the opinion that the cause of action in this case had arisen much earlier than the 23rd June, 1944, when the plaintiff's demand was refused by the defendant and that the suit was filed more than six months from the date on which it had accrued. The rule of limitation applicable to this case having now been held by the Full Bench to be as provided by section 326 of the Municipalities Act, the claim must be held to be time barred. We therefore hold that this application cannot succeed and dismiss it. In view of the circumstances of the case, we direct the costs in this Court to be borne by the parties themselves.
Application dismissed.