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Citation Codes
Equivalent Citations
citation codes
Case Number
Judges
  • G.N Das, J.
Acts
  • Indian Arbitration Act, 1940. The Indian Arbitration Act has incorporated Article 158 and Article 178
  • Article 120 of the First Schedule of the Limitation Act. Article 120
  • Bengal Moneylenders Act, by Article 181, Sch. 1, Indian Limitation Act.
  • Article 120 of Sch. 1 of the Indian Limitation Act. If that Article
  • Article 181 of the First Schedule of the Indian Limitation Act
  • borrower.6. Section 36 of the Bengal Moneylenders Act
  • Section 36(6)(a)(ii) of the Bengal Money-lenders Act.2.
  • Article 181, First Schedule of the Limitation Act.
  • Section 36(1) of the Bengal Money-lenders Act.7.
  • Section 36(1) of the Bengal Money-lenders Act
  • Article 144 of Sch. 1, Indian Limitation Act.
  • SECTION 36 BENGAL MONEY LENDERS ACT
  • Section 26-G(5) of the Bengal Tenancy Act.
  • Articles in Sch. 1 of the Limitation Act
  • INDIAN LIMITATION ACT
  • Article 120, Limitation Act.
  • BENGAL MONEY LENDERS ACT
  • S. 36(1). Section 36(1)
  • Act. Section 36(2)(e)
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Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Case Number
Judges
  • G.N Das, J.
Acts
  • Indian Arbitration Act, 1940. The Indian Arbitration Act has incorporated Article 158 and Article 178
  • Article 120 of the First Schedule of the Limitation Act. Article 120
  • Bengal Moneylenders Act, by Article 181, Sch. 1, Indian Limitation Act.
  • Article 120 of Sch. 1 of the Indian Limitation Act. If that Article
  • Article 181 of the First Schedule of the Indian Limitation Act
  • borrower.6. Section 36 of the Bengal Moneylenders Act
  • Section 36(6)(a)(ii) of the Bengal Money-lenders Act.2.
  • Article 181, First Schedule of the Limitation Act.
  • Section 36(1) of the Bengal Money-lenders Act.7.
  • Section 36(1) of the Bengal Money-lenders Act
  • Article 144 of Sch. 1, Indian Limitation Act.
  • SECTION 36 BENGAL MONEY LENDERS ACT
  • Section 26-G(5) of the Bengal Tenancy Act.
  • Articles in Sch. 1 of the Limitation Act
  • INDIAN LIMITATION ACT
  • Article 120, Limitation Act.
  • BENGAL MONEY LENDERS ACT
  • S. 36(1). Section 36(1)
  • Act. Section 36(2)(e)
See more information ...
Smart Summary

Structured Summary of the Opinion

Factual and Procedural Background

The appellant (a borrower) raised money on mortgage from the predecessor-in-interest of the respondents. The respondents sued in a mortgage suit and obtained a preliminary decree for sale on 24-5-1939, which was made final on 12-9-1939. Execution proceedings followed; the mortgaged properties were sold on 15-2-1940 and purchased by the decree-holders, who obtained possession (possession delivery is recorded as 20-6-1940 in the record). After the Bengal Money-lenders Act came into force on 1-9-1940, the appellant applied on 10-8-1946 for relief under Section 36 of that Act, seeking reopening of the decree, payment in instalments and restoration of possession.

The respondents defended primarily on the grounds that the Section 36 remedy was not available to the appellant and that the application was barred by the one-year limitation in Section 36(6)(a)(ii). The trial Court granted relief, reopening the decree and passing a new decree for Rs. 764-6 annas payable in six instalments. On appeal the District Judge (Howrah) held the proceedings were barred by Article 120 of the Limitation Act and dismissed the application. The appellant challenged that order in this appeal.

Legal Issues Presented

  1. Whether the remedy sought under Section 36(1) of the Bengal Money-lenders Act, in the factual posture where decree and execution had been completed and no proceedings were pending, is to be regarded as a "suit" for limitation purposes and, if so, which residuary Article of the First Schedule of the Indian Limitation Act applies.
  2. Whether the period of limitation for the Section 36(1) remedy is governed by Article 120 (six years) or by some other Article such as Article 181 (three years for applications) or Article 144 (twelve years for possession), or whether no period of limitation applies.
  3. Whether the District Judge's conclusion that time ran from the date possession was taken by the decree-holder auction-purchaser (10-7-1940 as treated by the District Judge) is legally correct.

Arguments of the Parties

Appellant's Arguments

  • The proceeding should be treated as an "application" (and not a suit), and therefore Article 181 of the First Schedule of the Indian Limitation Act could apply; but because the present application is not an application under the Code of Civil Procedure, Article 181 would be excluded and, according to one strand of argument, no period of limitation would apply.
  • Alternatively, if the proceeding is a suit, Article 144 (residuary article for possession, 12 years) would apply rather than Article 120.

Respondents' Arguments

  • The main defence advanced by the respondents was that the applicant could not invoke relief under the Bengal Money-lenders Act in the present circumstances and that any right to relief was barred by the one-year limitation contained in Section 36(6)(a)(ii) of the Bengal Money-lenders Act.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Satya Narayan v. Badha Nath, 45 Cal. W.N. 1085 Classification of remedies under Section 36 of the Bengal Money-lenders Act according to the stage of proceedings (suit pending, appeal pending, execution pending, or no proceedings pending). The Court relied on this decision to determine that when suit and execution are complete and no proceedings are pending, the borrower's only available remedy is under Section 36(1) (i.e., by a suit under S.36(1)). The decision provided the framework for identifying the correct procedural route to relief in the present facts.
In the matter of a petition of Ishan Chunder Roy, 6 Cal. 707 Historical authority for reading "application" in Article 181 as confined to applications under the Code of Civil Procedure (ejusdem generis approach), as applied in earlier decisions. The Court observed that earlier reliance on this decision is now undermined because the First Schedule of the Limitation Act includes Articles dealing with non-CPC statutes (e.g., Indian Arbitration Act, 1940), so the basis for confining Article 181 to CPC applications had been removed.
Asmat Ali Sharip v. Mujahar Ali Sardar, 52 Cal WN 64 (Special Bench) Considered the applicability of Article 181 beyond CPC applications; discussed the point but did not give a final opinion. The Court noted the Special Bench had discussed the issue and that it did not produce a conclusive ruling on the broader question; the Court relied on that treatment as part of the historical development of the issue.
Abinash Chandra Dutta v. Gour Chandra, 55 Cal WN 489 Holds that Article 181 applies to an application for possession under Section 26-G(5) of the Bengal Tenancy Act (i.e., Article 181 can govern applications under a statute other than the CPC). The Court cited this Bench decision as an example of a recent view supporting the applicability of Article 181 to statutory applications outside the CPC context, and indicated that, if necessary, it would hold Article 181 applicable to applications under the Bengal Money-lenders Act where the Act is silent on limitation.

Court's Reasoning and Analysis

The Court proceeded by first identifying the procedural posture and the statutory remedy available. Applying the classification in Satya Narayan v. Badha Nath, the Court found that when a mortgage suit has been concluded, execution completed, and possession taken with no appeal or execution proceedings pending, the borrower's sole remedy under the Bengal Money-lenders Act is by a suit under Section 36(1).

Section 36(1) itself does not prescribe any period of limitation. The Court therefore turned to the residuary provisions of the First Schedule of the Indian Limitation Act to determine the applicable limitation period. The Court identified Article 120 of the First Schedule as the proper residuary Article for a "suit for which no period of limitation is prescribed elsewhere in this schedule," prescribing six years from when the right to sue accrues.

On accrual, the Court reasoned that the right to sue under Section 36(1) could not exist before the statute conferring it came into force. Because the Bengal Money-lenders Act commenced on 1-9-1940, the right to sue under the Act could only accrue on or after that date. The appellant's proceedings, commenced on 10-8-1946, were therefore within six years of accrual under Article 120. The District Judge's contrary view—that time ran from the date possession was taken by the decree-holder auction-purchaser (recorded by the District Judge as 10-7-1940)—was rejected as erroneous because the right to sue did not exist at that earlier time.

The Court also addressed the alternative limitation-contentions raised by the appellant:

  • Article 181 (three years for applications): The appellant argued that the proceedings were "applications" and Article 181 applied; alternatively he argued Article 181 did not apply because the application was not under the Code of Civil Procedure. The Court observed that historically Article 181 had been read as limited to CPC applications (following Ishan Chunder Roy), but subsequent statutory developments (notably the Indian Arbitration Act, 1940) brought non-CPC statutory applications into the First Schedule and weakened the ejusdem generis basis for the restrictive reading. The Court noted a Special Bench (Asmat Ali Sharip) had discussed the point without finality, and a later Bench (Abinash Chandra Dutta) held Article 181 applicable to an application under the Bengal Tenancy Act. The Court recorded that, if it were necessary to decide, it would hold Article 181 applicable to applications under the Bengal Money-lenders Act where the Act is silent on limitation. However, because it concluded Article 120 applied and the suit was within six years, it did not need to rely on Article 181.
  • Article 144 (twelve years for possession): The appellant contended that if the proceedings were a suit, they should be treated as a suit for possession and governed by Article 144. The Court rejected this view: the primary object of a Section 36 proceeding is to reduce the decretal liability and give relief to the borrower; restoration of possession under Section 36(2)(e) is consequential on the reopening of the decree and is subject to conditions in the section. Therefore a suit under Section 36(1) is not, in substance, a suit for possession such that Article 144 should apply.

Because Article 120 was the proper residuary Article and the appellant's action was within six years of the accrual of the right (post-1-9-1940 commencement of the Act), the Court concluded the proceedings were in time.

Holding and Implications

HOLDING: The appeal is allowed. The Court held that the proceedings instituted by the appellant under Section 36(1) of the Bengal Money-lenders Act were governed by Article 120 of the First Schedule to the Indian Limitation Act (a six-year period), that the right to sue accrued only after the Act came into force on 1-9-1940, and that the appellant's proceedings commenced within six years and were therefore not time-barred. The judgment and decree of the learned District Judge (dismissal on limitation grounds) are set aside and the decree of the trial Court reopening the mortgage decree is restored with costs in this Court and in the lower appellate Court.

Implications:

  • Direct effect on the parties: The trial Court's order reopening the decree (and directing payment in instalments) is restored and the District Judge's dismissal on limitation grounds is reversed; the appellant's suit under S.36(1) is held to be within time.
  • On limitation law: The Court applied Article 120 as the proper residuary Article for a suit under Section 36(1) when the Act itself prescribes no limitation, and rejected the District Judge's approach of running limitation from a date prior to the statutory right's existence. The Court also indicated that Article 181 can, where necessary, apply to statutory applications outside the CPC, but it did not have to rest its decision on Article 181. The Court rejected the appellant's contention that Article 144 (residuary article for possession) applied to Section 36 suits.
  • No broader new precedent beyond the decision's holdings is expressly proclaimed; the direct legal consequences concern the proper application of the Limitation Act Articles to remedies under Section 36(1) in the factual posture described.

Disposition: Appeal allowed.

Show full summary ...

    Sarvamongala Dasi v. Paritosh Kumar Das

    1. This is an appeal by the plaintiff or, as the appellant chooses to say, the applicant in proceedings under Section 36(1) of the Bengal Money-lenders Act. The appellant raised money on a mortgage from the predecessor-in-interest of the respondents. The latter instituted a mortgage suit and obtained a preliminary decree for sale on 24-5-1939. The decree was made final on 12-9-1939. Thereafter the decree-holders started proceedings in execution and prayed for realisation of the decretal dues by a sale of the mortgaged properties. The mortgaged properties were sold on the 15th of February, 1940, and were purchased by the decree-holders. Thereupon the decree-holders, auction-purchasers, applied for possession and possession was delivered to them on 20-6-1940. It does not appear that thereafter any further proceedings were taken by the decree-holders or by the auction-purchasers. The Bengal Money-lenders Act having come into force on 1-9-1940, the appellant, judgment-debtor in the execution proceedings, made an application for relief under Section 36 of the Bengal Money-lenders Act, on 10-8-1946. The applicant prayed for the reopening of the mortgaged decree and for payment of the sum in instalments and for restoration of possession of the mortgaged properties which were acquired by the decree-holders in consequence of the execution of the mortgage decree. The respondents raised certain defences, the principal defence being that the application for relief under the Bengal Mpney-lenders Act was not available to the present appellant and that his right to relief was barred by the one year's rule of limitation contained in Section 36(6)(a)(ii) of the Bengal Money-lenders Act.

    2. The trial Court repelled the defence and reopened the mortgage decree and passed a new decree for a sum of Rs. 764-6 annas which was made payable in six instalments commencing with Asar, 1354 B.S

    3. The respondents preferred an appeal. The appeal was heard by the learned District Judge, Howrah. The learned Judge was of the opinion that the present proceedings were barred under Article 120, Limitation Act. In the result the proceeding initiated by the appellant was dismissed. It is the propriety of this order which is challenged in this appeal.

    4. Mr. Basu appearing on behalf of the appellant has first contended that the present proceeding partake of the nature of an application and in this view Article 181 of the First Schedule of the Indian Limitation Act might have been attracted but for the reason, as he suggests, that the present application is not an application under the Code of Civil Procedure; in his submission this fact excludes the operation of Article 181 of the First Schedule of the Indian Limitation Act and it must, therefore, be held that there is no limitation provided for by the Statute.

    5. The basis of this contention rests on the fact that the present proceeding partake of the character of an application. Mr. Basu drew my attention to the fact that the present proceeding was registered as a miscellaneous case. This is because of the rules which have been framed under the Bengal Moneylenders Act, and has nothing to do with the character of the proceedings which were initiated by the appellant borrower.

    6. Section 36 of the Bengal Moneylenders Act is a special provision which entitles the Court under certain circumstances to give relief to the borrower. The procedure for obtaining such relief varies according to the stage of the proceedings for recovery of a loan. The scope of S. 36 was considered by a Bench decision of this Court in the case of Satya Narayan v. Badha Nath, 45 Cal. W.N 1085. Mitter, J. delivering the judgment of the Court classified the various proceedings under the Bengal Money-lenders Act under different heads. It was pointed out that if the suit for recovery of the loan was pending, the borrower might apply for relief in that suit. No independent proceeding was necessary to obtain relief which the Bengal Moneylenders Act gave to the borrower. If the suit for recovery of a loan was disposed of by the trial Court and the matter was pending in appeal, the borrower might claim relief under the Act by an application in the appeal under the provisions of S. 36(6)(b) of the Act. If the suit or appeal had been disposed of and an execution proceeding was pending, the borrower might apply for relief in the execution proceeding under the provisions of S. 36(a)(i) of the Act. If no such proceedings were pending and a decree had been obtained for recovery of the loan, the borrower might apply for review for the purposes of getting relief under S. 36(6)(a)(ii) of the Act within one year of the date of the commencement of the Act. The borrower has an additional remedy by way of a suit under S. 36(1) of the Act. It was held in that case that such a relief could be obtained either before the loan had been sued upon or after the loan had been sued upon and a decree obtained but no proceedings either by way of an appeal or by way of an execution was pending in any Court. The position, therefore, is that the remedy of a party varies according to the stage of the proceedings for recovery of the loan. In the present case, the mortgage had been sued upon, a final decree had been obtained, the decree had been executed and the property had been sold and possession taken of the mortgaged properties. No proceeding was pending in any Court for recovery of the loan. The only remedy, therefore, which was available to the borrower was the remedy conferred on him by Section 36(1) of the Bengal Money-lenders Act.

    7. The material portion of Section 36(1) of the Bengal Money-lenders Act runs as follows:

    “notwithstanding anything contained in any law for the time being in force, if in any suit to which this Act applies, or in any suit brought by a borrower for relief under the section, whether heard ex parte or otherwise, the Court has reason to believe that the exercise of one or more of the powers under this section will give relief to the borrower, it shall exercise all or any of the following powers as it may consider appropriate, namely,………”

    8. Then follow Cls. (a) to (e) which define the powers which the Court will exercise under S. 36(1). Then there is a proviso which contains a limitation on the exercise of such powers. Section 36(2) then pays that if the Court in exercise of the powers conferred by S. 36(1) reopens the decree the Court will exercise certain other powers. One of the powers conferred on the Court is contained in S. 36(2)(e) which directs restoration of possession of the properties of the judgment-debtor which may have been acquired by the decree-holder in consequence of the execution of the decree sought to be reopened and which are in the possession of the decree-holder at the date of the reopened decree. Clause (e) then says that under certain conditions the property which has been restored to the possession of the judgment-debtor may revert to the decree-holder auction purchaser in case of non-payment of the instalments provided for in the reopened decree. If we apply the above principles, it is abundantly clear that in the present case the borrower could claim the reliefs prayed for, only by way of a suit under S. 36(1). Section 36(1) does not prescribe any period of limitation. We have, therefore, to turn to the material provision of the Indian Limitation Act which is Article 120 of the First Schedule of the Limitation Act. Article 120 reads as follows:

    “Description of suit. Period of limitation. Time from which period begins to run. Suit for which no period of limitation is prescribed elsewhere in this schedule. Six years When the right to sue accrues.

    9. The period prescribed by Article 120 is, therefore, six years from the date when the right to sue accrues. The right to sue for relief under Section 36(1) of the Bengal Money-lenders Act could not accrue to the borrower before the Act came into force. This is a right which is conferred by the Act and a party cannot claim that right prior to the date, i.e, at a time when the right was non-existent. The Bengal Money-lenders Act came into force on 1-9-1940. The present proceedings were started within six years thereof and as such would be in time. The learned District Judge was of the opinion that time ran from the date when possession was taken by the decree-holder auction purchaser, that is, 10-7-1940. This is obviously incorrect because the right was not in existence at the time. In my opinion, therefore, the view taken by the learned District Judge is erroneous and it must be held that the present proceeding started by the borrower, even if it is regarded as a suit, was well within time.

    10. In this view it is not necessary to consider the submission which was made on behalf of the appellant by Mr. Basu that there was no period of limitation in the present case. But as the matter has been argued at length I may record my opinion on this question also. The basis of the contention is that the present proceeding has to be regarded as an application made to the Court under the Bengal Money-lenders Act. The residuary Article applicable to an application is contained in Article 181, First Schedule of the Limitation Act. That Article reads as follows:

    “Description of application. Period of limitation. Time from which period begins to run. Application for which no period of limitation is provided elsewhere in this schedule or by Section 48 of the CPC. Three years When the right to apply accrues.”

    11. On the face of it the Article would apply to any application and would not be restricted to an application under the Code of Civil Procedure. It was however contended that there is a large body of decisions which have taken the view that Article 181 is confined to applications under the Code of Civil Procedure. An early decision of this Court is In the matter of a petition of Ishan Chunder Roy, 6 Cal. 707. This case has been followed ever since. But it must be remembered that at the time when these decisions were pronounced, the different Articles in Sch. 1 of the Limitation Act all related to applications under the Code of Civil Procedure. It was therefore held, that the word “application” in Article 181 must be read as ejusdem generis with the applications dealt with in the other Articles of the First Schedule. The position however has changed since the enactment of the Indian Arbitration Act, 1940. The Indian Arbitration Act has incorporated Article 158 and Article 178 in the First Schedule. These Articles deal with applications under the Indian Arbitration Act. The basis of the decision in the case of Ishan Chunder Roy, 6 Cal 707 and other cases following it, has therefore been taken away. This point was considered by a Special Bench of this Court in the case of Asmat Ali Sharip v. Mujahar Ali Sardar, 52 Cal WN 64 where Mukherjea, J. delivering the judgment of the Special Bench discussed this point but did not give a final opinion on the question. The applicability of Article 181 has been discussed recently in a Bench decision of this Court in the case of Abinash Chandra Dutta v. Gour Chandra, 55 Cal WN 489 where Chunder J. delivering the judgment of the Court has held that Article 181 applies to an application for possession under Section 26-G(5) of the Bengal Tenancy Act. If it was necessary for me to decide this question, I would hold that an application under the Bengal Moneylenders Act would be governed as regards limitation, in cases not expressly provided for in the Bengal Moneylenders Act, by Article 181, Sch. 1, Indian Limitation Act. It would be incorrect to say that there is no period of limitation for applications under the Bengal Money-lenders Act for which no specific period of limitation has been prescribed by that Act.

    12. Mr. Basu also contended that conceding that the proceedings in the present case can be regarded as a suit the proper Article to apply would be Article 144 of Sch. 1, Indian Limitation Act. That Article reads as follows:

    Description of suit. Period of limitation. Time from which period begins to run. For possession of immoveable property or any interest therein not hereby otherwise provided for 12 years When the possession of the defendant becomes adverse to the plaintiff.

    13. This Article is a residuary Article dealing with suits for possession. The question is whether a suit for relief under Section 36(1) of the Bengal Moneylenders Act can be regarded as a suit for possession. I have already referred to the material provisions of S. 36(1) and S. 36(2) of the Act. It is obvious that the whole object of a suit or proceeding under S. 36 is to scale down the interest decreed and to give relief to the borrower as provided for in the Act. Section 36(2)(e) no doubt provides for restoration of possession but this is consequential on the Court reopening the decree. Such restoration of possession is again conditioned by the terms of S. 36(2)(c) and (e) of the Act. Restoration of possession is one of the reliefs which the borrower gets when the decree is re-opened and that right to relief is circumscribed by the provisions of S. 36(2)(c) and S. 36(2)(e). It cannot be said that the suit itself is one for possession of immoveable property. I do not see my way to accept the contention raised by Mr. Basu that Article 144 would apply to such cases.

    14. As I have already said, the proper Article to apply is Article 120 of Sch. 1 of the Indian Limitation Act. If that Article is applied, I have already held that the present suit is within time. No other point was raised by either party. The result therefore is that this appeal is allowed. The judgment and decree of the learned District Judge are set aside and those of the trial Court; restored with costs in this Court and in the lower appellate Court.

    D.R.R

    15. Appeal allowed.

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    Comments

    Sarvamongala Dasi v. Paritosh Kumar Das
    (Aug 3, 1951)