- Bookmark
- Share
- CaseIQ
Vysyaraju Badarinarayana Moorty Raju v. State Of Orissa And Others
Structured Summary of the Opinion — Misra, C.J.
Factual and Procedural Background
The petitioner is a registered money-lender under the Orissa Money Lenders Act, conducting business in Berhampur, Ganjam district, with a registration certificate (No. 40 of 1973) specifying an amount of Rs. 13,25,000/-. The Act was amended by Orissa Act 54 of 1975 to insert Section 18-B, empowering the State Government to notify money-lenders (or classes/local areas of them) to produce business records and documents evidencing loans before a specified authority within a prescribed time, and providing for scrutiny, declaration under Section 18-B(2), and appeal.
The State Government issued a notification dated 11 October 1975 (published 15 October 1975) requiring registered money-lenders in Berhampur Tahsil to produce records within one month; appeals were to lie to the Collector, Ganjam. The petitioner submitted a return on 10 December 1975; the specified authority required production of records and had them preliminarily checked. On 18 May 1976 the specified authority passed an order concluding the money-lender had not furnished the required return within the stipulated period and therefore was not entitled to a declaration under Section 18-B(2); the authority treated the matter as closed and declined further punitive action.
The State Government issued a further notification dated 9 July 1976 (published 17 July 1976) again requiring production of records within one month. The petitioner was in custody from 10 August 1976; his son tendered accounts on 14 August 1976 and had earlier submitted accounts up to 15 November 1975 which had been examined. The petitioner explained that transactions after November 1975 could not be produced earlier because of his custody.
The specified authority and then the appellate authority refused relief in respect of transactions up to November 1975. The petitioner filed the present writ under Article 226 seeking to impugn the specified authority's order and the appellate affirmation.
Legal Issues Presented
- Whether the specified authority and the appellate authority erred in refusing to recognize compliance with the (second) notification in respect of accounts/transactions up to November 1975 and in refusing to grant the Section 18-B(2) declaration for those transactions.
- Whether the specified authority possessed power to condone delay or extend the time for compliance with a statutory production requirement under Section 18-B by invoking Section 5 of the Limitation Act, 1963 through the mechanism of Section 29(2) of the Limitation Act.
- How to construe the scope and effect of successive notifications under Section 18-B(1) — in particular whether a later notification must be read as limited to transactions after the earlier notification in the absence of express restriction.
Arguments of the Parties
Petitioner's (Appellant's) Arguments
- Counsel for the petitioner (Mr. Mohanty) argued that Section 5 of the Limitation Act — which permits condonation of delay in appropriate cases — applies to this situation by virtue of Section 29(2) of the Limitation Act, 1963, so that the specified authority could and should have examined whether to extend time.
- It was contended that the authority wrongly refused to exercise jurisdiction conferred by law to condone delay and that the appellate authority concurred in this error.
Opposite Parties' / State's Arguments
- The Additional Government Advocate contended that the Limitation Act applies to courts only and that, unless a special/local law expressly extends the Limitation Act to a quasi-judicial authority, the provisions (in particular Section 5) cannot be invoked by such an authority using Section 29(2).
- The appellate authority argued (as recorded) that the second notification (July 1976) was meant for money-lenders who had not availed of the original notification of 1975 and that it did not cover those who had already filed returns under the first notification.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Raghunath Agarwalla v. State of Orissa, (1975) 41 Cut LT 297 : (1975 Tax LR 2075) | Bench decision holding that although a tribunal under the Orissa Sales Tax Act was not a "court", Section 29(2) of the Limitation Act would attract the provisions of Section 5 (i.e., permitting condonation of delay) to that tribunal. | The court considered this precedent relied upon by petitioner but held it inapplicable to the present case for the reasons explained — chiefly because Section 18-B contemplates production of records (not filing of suits/appeals/applications), and thus Section 29(2) of the Limitation Act does not cover this type of statutory obligation. |
| Raja Pande v. Sheopujan Pande, AIR 1942 All 429 (Full Bench, Allahabad High Court) | Authority for the proposition that, where a statutory time for compliance is fixed by legislation for regulatory/welfare purposes, a clear legislative direction to comply within the date fixed implies exclusion of scope for extension of time. | The court relied on this Full Bench decision to support the view that Section 18-B was a regulatory/welfare provision intended to protect loanees and that the statutory prescription of a date showed legislative intent to exclude extension of time. |
| Hukumdev Narain Yadav v. Lalit Narain Mishra, AIR 1974 SC 480 (Supreme Court) | Support for the principle that where legislation fixes a period for compliance in regulatory/welfare enactments, the period is intended to be strictly observed and not ordinarily extended. | The court cited this Supreme Court decision in support of the conclusion that the statutory period for production under Section 18-B indicates an intention to exclude discretion to extend time, and used it to reject the petitioner's reliance on Section 29(2)/Section 5. |
Court's Reasoning and Analysis
The court's analysis proceeds in discrete steps, applying statutory construction and precedent to the facts presented.
-
Nature of statutory obligation under Section 18-B:
The court observed that Section 18-B(1) authorises the State Government to notify money-lenders to produce records before a specified authority; the subsection contemplates physical production of records and not the filing of a suit, appeal or application.
Because the statutory requirement is to produce records (not to institute judicial proceedings), the court held that the mechanism of the Limitation Act (which addresses periods for suits, appeals and applications) was not directly engaged by the statutory obligation under Section 18-B(1).
-
Applicability of Section 29(2) of the Limitation Act and Section 5 (condonation of delay):
The petitioner relied on Section 29(2) of the Limitation Act, 1963 to bring Section 5 into play. The court analysed the language and legislative scheme, noting that the Limitation Act's Section 29(2) applies where a special or local law prescribes a period of limitation for suits, appeals or applications; it then makes the provisions of Sections 4–24 applicable unless expressly excluded.
The court concluded that Section 29(2) does not extend to a case where the statute (Section 18-B) requires production of records rather than the filing of a suit/appeal/application. Therefore, the authority could not be said to have the power to condone delay under Section 5 by invoking Section 29(2) in this context.
-
Construction of successive notifications and the appellate authority's interpretation:
The appellate authority had inferred that the second notification was limited to transactions after the first notification. The High Court rejected that inference: in the absence of an express restriction in the second notification, the court refused to imply a limitation on its scope.
The court found that the petitioner had, in fact, placed before the specified authority accounts up to November 1975 (these had been examined), and that the specified authority and the appellate authority were wrong to refuse to take steps under the statute in respect of transactions up to November 1975.
-
Legislative intent and exclusion of extension of time:
Recognising that the amendment (inserting Section 18-B) was regulatory and intended to protect loanees, the court accepted that the statutory scheme envisioned a fixed time for compliance. The court held that where the legislature has authorised a specific period for compliance in regulatory welfare legislation, there is a strong indication that power to extend that period was intended to be excluded.
This conclusion was reinforced by authorities (the Full Bench of the Allahabad High Court and the Supreme Court) endorsing the strict observance of statutory periods in such contexts.
-
Synthesis and outcome on the central questions:
Applying the foregoing analysis, the court rejected the petitioner's contention that the specified authority had jurisdiction to extend time under Section 5 invoked via Section 29(2) of the Limitation Act.
However, on the factual finding that accounts up to November 1975 had been produced and examined (even if initially filed late under the first notification), the court held that the specified authority and appellate authority were wrong to refuse to grant the Section 18-B(2) declaration in respect of transactions up to November 1975.
Holding and Implications
Holding: Petition partly allowed.
Specific orders and direct effects:
- The court quashed the orders of the specified authority and the appellate authority to the extent indicated.
- The court directed issuance of a writ of mandamus commanding the specified authority (opposite party) to issue the requisite certificate contemplated under Section 18-B(2) of the Orissa Money Lenders Act to the petitioner in respect of money-lending transactions up to November, 1975, within two months from the date of the judgment.
- The court rejected the petitioner's broader contention that the authorities had jurisdiction to extend time for production of records beyond the statutory period by invoking Section 5 via Section 29(2) of the Limitation Act; consequently, the petitioner is not entitled to relief in respect of transactions beyond November, 1975 up to the date of the second notification.
- Costs: As success was divided, each party is directed to bear its own costs.
Broader precedent implications: The court indicated that the line of authority allowing Section 5 via Section 29(2) in certain contexts (as in Raghunath Agarwalla) did not apply to the facts and statutory framework here; the decision focuses on statutory construction of Section 18-B and the nature of the obligation to produce records. The opinion does not purport to lay down a general rule beyond the facts and statutory context addressed.
Disposition: Petition partly allowed; mandamus issued as specified; parties to bear their own costs.
Misra, C.J:— This application under Article 226 of the Constitution of India seeks to assail the order passed by the authority specified under Section 18-B of the Orissa Money Lenders Act, 1939 (opposite party No. 3) as affirmed in appeal by the authority specified under sub-section (6) thereof (opposite party No. 2).
2. Petitioner is a registered money-lender under the provisions of the Orissa Money Lenders Act (hereinafter referred to as the ‘Act’) carrying on business in Berhampur area within the district of Ganjam and in his certificate of registration bearing No. 40 of 1973, the amount specified was Rs. 13,25,000/-. The original Act underwent an amendment and by Orissa Act 54 of 1975, Section 18-B was inserted into the statute. As far as relevant that section provided:—
“(1) The State Government may, from time to time, by notification, require the money lenders or money lenders belonging to any class or carrying on business in any local area, to produce before such authority and by such date as may be specified in the said notification, all records relating to their business including documents evidencing advance of loans.
(2) The authority specified in the notification referred to in sub-section (1) shall scrutinize the documents with a view to determining if the transactions exceed the amount for which the money lender has obtained the registration certificate and shall, after giving the money lender a reasonable opportunity of being heard, pass an order declaring the particulars of transactions that are within the amount specified in the said certificate.
xxxxxx
(5) An order made under sub-sec. (2) ………..shall forthwith be communicated to the concerned money lender by the authority who has made the order.
(6) Any person aggrieved by an order passed under sub-section (2) ………..may, within one month from the date of communication of the said order, prefer an appeal before such authority as may be specified in the notification referred to in sub-section (1).
(7) An order passed under sub-sec. (2) …………shall, subject to the order passed in an appeal, if any, be final and shall not be called in question in any Court.” In exercise of powers under sub-sec. (1), the State Government issued a notification dated 11th October 1975, which was published in the Orissa Gazette in an extraordinary issue dated October 15, 1975. The notification was to the following effect:—
“S.R.O No. 776/75 — The State Government in exercise of the powers conferred by Section 18-B of the Orissa Money Lenders Act, 1939 as amended by the Orissa Money Lenders (Amendment) Ordinance, 1975, do hereby direct that all registered money lenders carrying on business in Berhampur Tahsil of Ganjam district shall produce the records relating to their business including documents evidencing advance of loans to the Sub-Divisional officer, Berhampur, within one month from the date of publication of this notification.
Appeal against any order passed by the Sub-Divisional officer, Berhampur under sub-section (2) or sub-section (4) of Section 18-B of the Orissa Money Lenders Act, 1939 shall be preferred to the Collector, Ganjam.”
Petitioner submitted his return to the specified authority on 10-12-1975 and the authority after perusing the return on 12-12-1975, required the petitioner to produce his records and accounts before the Nizarat officer for a preliminary check. The Nizarat officer furnished his report pointing out defects and the specified authority after adjourning the matter from time to time ultimately on 18-5-1976, passed the following order:—
“Received the case record. The money-lender has not furnished the required return showing the transactions of money-lending within the stipulated period. As such he is not entitled to a declaration prescribed under Sec. 18-B(2) of O.M.L Act, 1975. In result, as far as the jurisdiction of civil court is concerned the transactions of money-lending made by the money-lender stand liquidated. As such I do not consider any further punitive action against the money-lender. Case closed.”
The State Government issued another notification dated 9th of July, 1976 (Annexure-11) in exercise of the power under Section 18-B of the Act. This notification was published in the Orissa Gazette, Extraordinary, on 17-7-1976 as admitted in paragraph 9 of the counter affidavit of the specified authority. This notification required all registered money-lenders carrying on business in the Tahsil areas specified in column (2) to produce records relating to their business including documents within one month from the date of publication in the official gazette. The notification under Annexure-11 was in similar terms as Annexure-1. Petitioner was in jail custody with effect from 10th of August, 1976, and his son representing the family on whose behalf the money-lending licence had been held, offered to produce the accounts to the specified authority on 14-8-1976. Annexure-13 is a copy of the application dated 13-8-1975, wherein, it was pointed out:—
“The petitioner has submitted a list showing the names of his debtors and the amounts advanced and outstanding as was required under law as per the first notification in 1975. The account books were produced for examination.
xxxxxx
Already a return up to 15-11-1975 was submitted. The transactions thereafter and the return could not be submitted earlier as the petitioner has been taken into jail custody on 10-8-1976 before the appointed date 14-8-1976 for returns and in his absence it cannot be prepared.”
This fact has not been denied in the counter affidavit. We must, therefore, proceed on the footing that the petitioner within one month from the second notification had indicated that his accounts up to November, 1975, were already before the specified authority and in fact they had already been checked up. But the transactions beyond November, 1975, up to then had, however, not been produced before the specified authority in time.
“Month” has been defined in Section 2 of the Orissa General Clauses Act to mean a month reckoned according to the British calendar. Sub-section (28) of the same section defines ‘notification’ to mean a notification in the Gazette. In view of these provisions and the conceded position that the second notification was published in the State Gazette on 17th July, 1976, compliance made within a month from the date of the publication of the notification would be appropriate and in accordance with law. It is not disputed that accounts of the petitioner up to November, 1975, were before the specified authority though in terms of the first notification they had been filed beyond time. In view of the steps taken vide Annexure-13, it cannot be said that the accounts up to November, 1975, were not before the specified authority in time.
Before the appellate authority this question had been argued as would appear from its judgment. The judgment indicates:—
“The learned Advocate for the money-lender argued in my court at some length that although the first return was delayed, he has filed the second return subsequently, and that by virtue of the notification dated 9-7-1976, the State Government have given one month's time to file returns before the same S.D.Os including the S.D.O, Berhampur in respect of Berhampur tahsil (among other tahsils). To this, the learned Advocate for the third party argued that this notification is for those money-lenders who did not avail of the original notification of 1975 and not for those who had already filed their returns as per that notification. Be that as it may, the use of the expression from time to time in the first sentence in Section 18-B, sub-section (1), clearly indicates that the State Government will not stop after one notification, but from time to time may give chances to the money-lenders to file their returns. This action is considered necessary under the law obviously with the intention of protecting the loanees of the money-lenders from usurious practice. But once a notification is issued, it is incumbent on the money-lenders to file returns and obtain declaration under Section 18-B(2) of the Act from the competent authority in respect of his transactions.
If the returns are not filed in time, the said declaration will not be forthcoming as per the provisions of Section 18-B and sub-section (8) will automatically be attracted in respect of the transactions which have taken place prior to the date of notification. A subsequent notification will obviously give chance to the money-lender to file return of loans advanced by him between the two dates of the notification.”
There is no warrant for this view of the appellate authority. Section 18-B(1) of Act vests authority in the State Government to notify from time to time. It was open to the State Government to restrict the operation of the second notification to transactions after the first notification. In the second notification, there is no indication of any such restriction. In the absence of such restriction, it cannot be assumed, as has been done by the appellate authority, that the State Government intended the second notification to cover transactions of money-lending which took place after the date of the first notification. It is true that unless there be compliance with sub-section (2), in view of the mandate in sub-section (8), no court would entertain any claim and if there be no notification by the State Government and no compliance of sub-sec. (2), the money-lender would not be in a position to take the-assistance of the court for recovery of his loan. While inevitably that would be the consequence for inaction, it does not justify the conclusion of the appellate authority that even though the second notification did not indicate the transactions after the first notification were to be accounted for, such a restriction must be implied. In the facts of the case, there is no escape from the position that there was compliance with the second notification by intimating to the specified authority that the accounts up to November, 1975, which had already been produced were before the authority and the same might be looked into. The specified authority as also the appellate authority have clearly gone wrong in refusing to take steps under the statute in respect of transactions up to November, 1975.
3. The main question that has been canvassed before us is whether the specified authority has power to condone delay by extending the limitation when moved under Section 5 of the Limitation Act of 1963, Section 29(2) of the Limitation Act is relied upon in support of the submission. That sub-section provides:—
“Where any special or local law prescribes for any suit, appeal or application a period of limitation different from the period prescribed by the Schedule, the provisions of Section 3 shall apply as if such period were the period prescribed by the Schedule and for the purpose of determining any period of limitation prescribed for any suit, appeal or application by any special or local law, the provisions contained in Sections 4 to 24 (inclusive) shall apply only in so far as, and to the extent to which, they are not expressly excluded by such special or local law.
Indisputably the provision of sub-section (2) of Section 29 is different from the corresponding provision of the earlier Act of 1908. The new Act extends the application of provisions of Secs. 4 to 24 unless there be exclusion in the special Act while the old Act required specified provision to make these sections applicable to the special Act. Mr. Mohanty for the petitioner contends that by virtue of Section 29(2) of the Limitation Act of 1963, Section 5 is applicable to a case of this type and when power under that section had been asked to be exercised, the authority under the statute should have examined to find out whether a case for extending time had been made out. But under a mistaken impression that the provision has no application, the specified authority has refused to exercise jurisdiction duly vested in him under the law. It is contended that the appellate authority fell into the same error while concurring with the specified authority.
Mr. Mohanty does not contend that the specified authority is a ‘court’, but relies on a Bench decision of this Court in the case of Raghunath Agarwalla v. State Of Orissa, (1975) 41 Cut LT 297 : (1975 Tax LR 2075), where this Court has taken the view that though the Tribunal under the Orissa Sales Tax Act was not a court, yet in view of the language of Section 29(2) of the Limitation Act, the provisions of Section 5 thereof would be attracted. Learned Additional Government Advocate, on the other hand, has contended that the Limitation Act applies to courts only and unless by statutory provision, the provisions of the Limitation Act would be extended to quasi-judicial authorities not being courts, the provisions of the Limitation Act cannot be applied on the basis of Section 29(2) thereof. Series of authorities have been cited before us by counsel for both sides in support of their respective propositions.
sub-section (1) of Section 18-B of the Act vests the State Government with power to notify the date within which the records relating to the business including documents evidencing advance of loans are to be produced before the specified authority. The section does not at all envisage any application to be filed. The only step contemplated by sub-section (1) is that the money-lender shall produce before the specified authority all the records relating to the business including documents evidencing advance of loans. The requirement under sub-section (1) of Section 18-B not being in relation to filing of suits, appeals or applications, sub-section (2) of Section 29 of the Limitation Act does not cover a case of this type. It is not Mr. Mohanty's case that whenever any action not being filing of a suit, appeal or application, is required by any statute to be done, the aid of Section 5 of the Limitation Act can he invoked through the mechanism provided under Section 29(2) of the Limitation Act. We are, therefore, inclined, to think that sub-section (2) of Section 29 does not cover a case of this type.
Undoubtedly, the amendment which brought in Section 18-B into the statute was inserted into the Act with a view to introducing further regulations on the money-lender. This was a beneficial legislation for the loanees and with a view to doing it the Amending Act brought in welfare provision. The legislative intention being regulation and the period to be fixed for compliance having been statutorily authorised, we think that a clear direction to comply within the date fixed and thus by implication to exclude the scope for extension of time had really been intended.
This view is supported by the Full Bench decision of the Allahabad High Court in the case of Raja Pande v. Sheopujan Pande, AIR 1942 All 429, and the Supreme Court in the case of Hukumdev Narain Yadav v. Lalit Narain Mishra, AIR 1974 SC 480 has upheld this view. We are, therefore, inclined to think that to the facts of the present case the principle indicated by the Division Bench of this Court in the sales tax matter in (1975) 41 Cut LT 297 : (1975 Tax LR 2075) (supra) would have no application for the reasons indicated above and petitioner's contention that the specified authority had jurisdiction to extend the time must be repelled. We accordingly reject the argument of Mr. Mohanty for the petitioner that the authorities under the Act had illegally refused to exercise jurisdiction vested in them under the law. In view of the admitted position that accounts had not been produced before the specified authority for the period beyond November, 1975, the petitioner is not entitled to the relief for the same up to the date of the second notification.
4. On the analysis presented above, this writ application succeeds in part. We quash the orders of the specified and the appellate authorities and direct issue of a writ of mandamus to the opposite party, specified authority to issue the requisite certificate contemplated under Sec. 18-B(2) of the Orissa Money Lenders Act to the petitioner in respect of the money lending transactions up to November, 1975, within two months from now. As success is divided, parties are directed to bear their own costs.
P.K Mohanty, J.:— I agree.
Petition partly allowed.
Alert