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  • section 103 of the Assam Local Self-Government Act (Assam Act XXV of 1953) and under Articles 2 and 36 of the Limitation Act.
  • provisions of section 538 of the Calcutta Municipal Act
  • Section 103 of the Assam Local Self-Government Act
  • time.15. Section 538 of the Calcutta Municipal Act
  • Section 538 of the Calcutta Municipal Act,
  • English Public Authorities Protection Act
  • Article 2 of the Limitation Act
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Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Case Number
Attorney(S)
Judges
Acts
  • section 103 of the Assam Local Self-Government Act (Assam Act XXV of 1953) and under Articles 2 and 36 of the Limitation Act.
  • provisions of section 538 of the Calcutta Municipal Act
  • Section 103 of the Assam Local Self-Government Act
  • time.15. Section 538 of the Calcutta Municipal Act
  • Section 538 of the Calcutta Municipal Act,
  • English Public Authorities Protection Act
  • Article 2 of the Limitation Act
Smart Summary

Factual and Procedural Background

The plaintiff was appointed Headmaster of the Titabar Middle English School in 1918. He retired on 30-6-1951 but was re-employed and finally left office on 30-9-1953. Under the Local Board's rules, the plaintiff contributed two annas per rupee to a Provident Fund and the Board contributed one anna per rupee. The Board deposited Provident Fund moneys in the Post Office Savings Bank until about 1946, when part was transferred to the Jorhat branch of the Calcutta Commercial Bank Limited on the instance of the Board's Chairman.

When National Savings Certificates were introduced, the plaintiff expressed willingness to invest his Provident Fund in those certificates and, by letter dated 26-4-48, asked the Chairman (defendant No. 2) to withdraw the money from the Post Office Savings Bank and the Calcutta Commercial Bank and invest it in National Savings Certificates. The Calcutta Commercial Bank went into liquidation in September 1948; the plaintiff discovered that his Provident Fund money deposited there had not been withdrawn. The defendants paid the sum standing in the Post Office Savings Bank, but Rs. 3,044/2 (with interest later totalling Rs. 3,099) remained unpaid, which led to the present suit.

The Jorhat Local Board (defendant No. 1) and the Chairman (defendant No. 2) contested the suit. Defendant No. 1 relied on a 27-11-40 resolution accepting revised Provident Fund rules allowing investment in a scheduled bank (the Calcutta Commercial Bank was a scheduled bank), denied receipt of the 26-4-48 letter, and said the deposits at the Bank were fixed deposits that had not matured. It also pleaded limitation. Defendant No. 2 maintained that the deposit was made on 12-8-41 when he was not Chairman or a member of the Board and repeated the Board's defenses.

The trial Court decreed the suit against the Board for the amount claimed with interest at 2% per annum from the date of the decree and dismissed the suit against defendant No. 2. On appeal by defendant No. 1 the lower appellate Court affirmed the decree. The present document is the judgment on the appeal by defendant No. 1 (the Board), which has been dismissed.

Legal Issues Presented

  1. Whether the suit for recovery of the plaintiff's Provident Fund moneys is barred by limitation under Section 103 of the Assam Local Self-Government Act (Assam Act XXV of 1953).
  2. Whether the suit is barred under Article 2 or Article 36 of the Limitation Act (i.e., whether those Articles apply to deny the plaintiff's claim).
  3. Whether the Board acted properly in investing the plaintiff's Provident Fund in the Calcutta Commercial Bank without the plaintiff's individual consent, and whether the Board could withdraw the fixed deposits prior to maturity.
  4. Whether the appellate court was correct in applying the residuary limitation Article (Article 120) where no specific Article of the Limitation Act applied.

Arguments of the Parties

Appellant (Defendant No. 1 — Jorhat Local Board)

  • The Board relied on a 27-11-1940 resolution adopting revised rules permitting investment of Provident Fund moneys in a scheduled bank; accordingly it lawfully deposited money in the Calcutta Commercial Bank, a scheduled bank.
  • The Board denied receiving the plaintiff's letter dated 26-4-48 requesting withdrawal and investment in National Savings Certificates.
  • Even if the letter had been received, the Board could not have withdrawn the money because the moneys were held in Fixed Deposit accounts that had not matured.
  • The Board asserted that the plaintiff's claim was barred by limitation, invoking Section 103 of the Assam Local Self-Government Act and Articles 2 and 36 of the Limitation Act.

Respondent (Plaintiff)

  • The plaintiff asserted ownership of the Provident Fund moneys payable to him and that the Board withheld those moneys after the Calcutta Commercial Bank went into liquidation.
  • The plaintiff claims he wrote to the Chairman on 26-4-48 requesting withdrawal of his money from the Bank to be invested in National Savings Certificates.
  • The plaintiff sought recovery of the balance due (Rs. 3,044/2, with interest later totalling Rs. 3,099) that the Board had not paid.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Amar Singh v. Deputy Commissioner, Gujranwala, AIR 1937 Lab 748 Cited by appellant (generally) as supporting limitation/defence; specific principle not elaborated in the opinion. The court held that this case had no resemblance to the facts of the present case and distinguished it.
Pt. Shiam Lal v. Abdul Raof, AIR 1935 All 538 Cited by appellant; the opinion describes an associated case concerning a suit for damages arising from a police report (as part of the cluster of authorities relied on). The court treated this case as materially different in facts and not applicable to the present claim for recovery of Provident Fund moneys.
Secretary of State v. Lodna Colliery Co. Ltd., AIR 1936 Pat 513 Interpreted in the opinion for the object of Article 2 of the Limitation Act: protection of public officials who bona fide act under statutory powers; establishes requirements for Article 2 to apply. The court quoted and relied on the passage explaining Article 2's object to conclude Article 2 did not apply to the present suit for recovery of money.
Shariful Hasan v. Lachmi Narain, AIR 1932 All 16 Cited by appellant; no specific principle from the case set out in detail in the opinion. The court found the facts of that case to be quite different and therefore not helpful to the appellant.
Kripa Ram v. Kunwar Bahadur, AIR 1932 All 256 Cited by appellant; no detailed principle extracted in the opinion. The court held the case to be different in facts and not analogous to the present matter.
Jatindra Nath Pal v. Corporation of Calcutta, AIR 1945 Cal 44 Case concerned recovery of Provident Fund money and the appropriate application of Limitation Act articles (court in that case held residuary article applied rather than a specific three-year article). The present court agreed with the decision and regarded it as supportive: provident fund recovery suits are not necessarily barred by a three-year municipal provision and may be governed by a residuary article.
Corporation of Calcutta v. Asoke Kumar De, AIR 1928 Cal. 43 Involved recovery of Provident Fund money and the effect of a municipal act provision (section 538 of Calcutta Municipal Act) on limitation. The court cited this case as authority for the proposition that the municipal provision did not cover suits for recovery of Provident Fund moneys; it was treated as supportive of the respondent.
Tinsukia Municipal Board v. Bankim Chandra Ghose, AIR 1950 Assam 101 Cited to consideration; concerned municipal board matters. The court considered it but concluded the facts were not similar and therefore it did not aid the appellant.

Court's Reasoning and Analysis

The court's analysis proceeded along two parallel lines: (a) factual findings made by the lower appellate Court and (b) legal characterisation of the suit for limitation purposes.

On the facts, the appellate court had found that:

  • The Board's own rules required obtaining individual consent of a subscriber before investing his Provident Fund money in a particular bank;
  • The Board did require individual consent of teachers and had obtained consent of members of a Teachers Association, but the plaintiff was not a member of that Association;
  • No consent of the plaintiff was obtained for investment in the Calcutta Commercial Bank;
  • The plaintiff did write to the Chairman on 26-4-48 requesting withdrawal from the Calcutta Commercial Bank;
  • The Provident Fund moneys were in two fixed deposits in the Bank, one maturing on 30-6-48 and the other on 12-8-48;
  • On 30-6-48 the Bank was functioning normally and the Board could have withdrawn the plaintiff's amount on that date but did not do so;
  • The suit was not barred by limitation under Section 103 of the Assam Local Self-Government Act nor under Article 2 or Article 36 of the Limitation Act.

Legally, the court emphasised the correct characterization of the plaintiff's claim: it is a suit for recovery of money belonging to the plaintiff, not a suit "for anything done under" the Assam Local Self-Government Act. Therefore, the protection and shorter limitation period in Section 103 (which applies to suits "for anything done under this Act") did not apply.

The court then considered the Limitation Act Articles relied upon by the appellant:

  • Article 2 (ninety days) applies to "compensation for doing or for omitting to do an act alleged to be in pursuance of any enactment" and is intended to protect public officials who bona fide purport to act under statutory powers (i.e., where an official has an honest belief in factual circumstances which, if true, would justify the act). The court concluded that Article 2 is directed to actions which are in the nature of torts committed under colour of statutory authority and does not apply to a straightforward claim for recovery of funds belonging to the plaintiff.
  • Article 36 (one year) applies to "compensation for any malfeasance, misfeasance or non-feasance independent of contract" and, similarly, is aimed at compensation for such wrongs. The court held that the present suit is not a suit for compensation for malfeasance/misfeasance/non-feasance but is a suit for recovery of money due, so Article 36 is inapplicable.
  • Because no specific article of the Limitation Act applied, the court agreed with the lower appellate Court that the residuary article (Article 120) applied to govern limitation.

The court also dealt briefly with certain factual contentions such as an asserted payment of Rs. 2,000 to the plaintiff, noting that the matter was factual, not raised as an issue earlier, and therefore could not be litigated afresh on appeal.

Holding and Implications

APPEAL DISMISSED

Holding:

  • The appellate court affirmed the decree of the trial Court in favour of the plaintiff and dismissed the appeal by defendant No. 1 with costs.
  • Specifically, the trial Court's decree for the amount claimed (with interest at 2% per annum from the date of the decree until realisation) against defendant No. 1 was upheld; the dismissal of the suit against defendant No. 2 remains unchanged.

Implications:

  • The direct practical effect is that the plaintiff's decree for recovery of the Provident Fund moneys (and interest as decreed) stands and the Board is liable to satisfy that decree.
  • The court held that Section 103 of the Assam Local Self-Government Act and Articles 2 and 36 of the Limitation Act do not bar this particular suit; instead, the residuary article of the Limitation Act applies where no specific article is found to govern the action.
  • The opinion does not purport to establish any broad new legal principle beyond the application of existing limitation law to the facts; it primarily applies established principles to the specific circumstances and distinguishes the authorities cited by the appellant. No novel precedent was announced beyond the court's factual and legal conclusions in this matter.

Result recorded in the opinion: "Appeal dismissed." (The decree below for the plaintiff was affirmed; costs awarded against the appellant.)

    Jorhat Local Board v. Ambika Charan Saikia

    1. This appeal is by the defendant No. 1. The Jorhat Local Board, of which the Deputy Commissioner, Sibsagar, Jorhat, is at present in charge, and the Deputy Commissioner, as per petition filed by him, has been substituted in place of the Jorhat Local Board.

    2. The facts briefly are that the plaintiff was the Headmaster of the Titabar Middle English School, having been appointed in 1918. He retired from service on 30-6-1951, but was re-employed and went out of office on 30-9-53. Under the rules of the Board, out of the plaintiffs salary, he had to deposit annas two in the rupee by way of Provident Fund subscription, and one anna per rupee was to be contributed by the employer, the Local Board. The amount of the Provident Fund used to be deposited by the Board in the Post Office Savings Bank till sometime in 1946, when a part of it was transferred and deposited in the Jorhat branch of the Calcutta Commercial Bank Limited at the instance of the Chairman of the Board. When the National Savings Certificates Scheme was introduced, the plaintiff showed his willingness to have his Provident Fund money invested in those Certificates, and with that end in view the plaintiff wrote a letter, dated 26-4-48, to the then Chairman) (defendant No. 2) requesting him to withdraw the money from the Post Office Savings Bank and the Calcutta Commercial Bank Limited, and to invest the same in National Savings Certificates. The Calcutta Commercial Bank went into liquidation sometime in September, 1948, and the plaintiff came to know that the money deposited therein, including the money belonging to the Provident Fund of the plaintiff, had not been withdrawn from the said bank. The defendants paid the plaintiff the money which was in deposit in the Post Office Savings Bank but the balance, namely, a sum of Rs. 3044/2/- which, with interest came to Rs. 3099/-, was not paid to the plaintiff, and hence the present suit.

    3. The defendant No. 1, the Board, contested the suit, as well as the defendant No. 2. The defence of the defendant No. 1 is that the Board, by a resolution dated 27-11-40, had accepted the revised rules in regard to the Provident Fund, which enabled the Board to invest the Provident Fund money in a scheduled bank, and the money was accordingly deposited in the Calcutta Commercial Bank Limited, which was a scheduled bank. The defendant No. 1 further denies the receipt of any letter dated 26-4-48, from the plaintiff, and adds that even if the letter had been received by it, if could not have withdrawn the money from the aforesaid bank because the money was kept there under the Fixed Deposit account, and the deposit had not matured.

    4. It was further alleged that the Provident Fund money became due to the plaintiff on 1-7-51, the plaintiff having retired from service on 30-6-51, and, therefore, the claim of the plaintiff was barred by limitation. The defence of the defendant No. 2 was that the money in question was deposited on 12-8-41 when he was neither the Chairman nor even a member of the Board, and he has repeated the same defence which was taken by the defendant No. 1. We are not concerned with the defence of defendant No. 2. In any greater detail for the reason that the suit has not been decreed against him.

    5. The trial Court decreed the suit for the amount claimed, with mterest at 2 per cent per annum, from the date of the decree till realisation against the defendant No. 1, the Board, and dismissed the suit against the defendant No. 2. On an appeal by the defendant No. 1, the decree of the first Court has been affirmed, and hence this appeal.

    6. The lower appellate Court has found—

    (i) that, according to the rules framed by the Board, the individual consent of a subscriber was to be taken for investment of his Provident Fund money in a particular Bank:

    (ii) that the Board insisted on the individual consent of the teachers concerned regarding the investment of their Provident Fund money, and, in fact, the consent of the members of the Teachers Association was taken: — (It must be mentioned that the plaintiff was not a member of such an Association)

    (iii) that no consent of the plaintiff was taken for investment of his money in the Calcutta Commercial Bank Limited:

    (iv) that the plaintiff did write to the Chairman of the Board on 26-4-48 to withdraw the money from the Calcutta Commercial Bank Limited;

    (v) that the Provident Fund money was kept in two deposits in the said Bank, one of which amounted to Rs. 16,000/- and was to mature on 30-6-48; and that the other amount of Rs. 60,000/- was to mature on 12-8-48;

    (vi) that, on 30-6-48, the Bank was functioning normally, and, therefore, the Board could have easily withdrawn the amount of the plaintiff on that date from the Bank, but that was not done; and

    (vii) that the suit was not barred by limitation either under Section 103 of the Assam Local Self-Government Act or under Article 2 or 36 of the limitation Act.

    7. The learned counsel. Mr. Goswami, appearing on behalf of the appellant has submitted, that the Court below is wrong in holding that the suit is not barred by limitation, and he has repeated the submissions made in the Court below on behalf of his client, namely, that the suit is barred under Section 103 of the Assam Local Self-Government Act (Assam Act XXV of 1953) and under Articles 2 and 36 of the Limitation Act. Before the question of limitation under a particular section of the aforesaid Act XXV of 1953 or under a particular Article of the Limitation Act is considered, it has to be borne in mind that the money, for the recovery of which the suit has been brought, belonged to the plaintiff, and that he has merely sued for recovery of the amount due to him by the Board. The relevant portion of Section 103 of the Assam Local Self-Government Act runs as follows:

    “103.(1).—A suit shall not be instituted against any Local Board or against any member of the Board or against any officer or servant of the Board, or any person acting under its direction, ‘for anything done under this Act’ …… and also, where it is intended to institute the suit against any officer or servant of the Board or any person, acting under its direction…………….

    (3) Every suit of the nature referred to in sub-section (1) shall be instituted within a period of three months from the date on which the cause of action arose …………….”

    8. The important words in by opinion, have been underlined (here into ???) by me.

    9. In my judgment, the present suit is not ‘for any thing done under this Act’. As I have said, the suit as merely for recovery of the money belonging to the plaintiff, and it cannot by any stretch of imagination be said that the suit is ‘for anything done under this Act’. The money which belonged to the plaintiff, has been withheld by the Board, and there is no provision anywhere which has been brought to my notice to the effect that the Board was entitled to withhold the said money of the Provident Fund of the plaintiff. Article 2 of the Limitation Act prescribes ninety days' limitation from the date when the act or omission takes place, ‘for compensation for doing or for omitting to do an act alleged to be in pursuance of any enactment in force for the time being in India.’

    10. I cannot possibly persuade myself to accept the submission of Mr. Goswami to the effect that this Article applies. On the language of the Article itself, it appears that it is intended to apply for the protection, under certain circumstances, of acts which are not legal or justifiable, and for protection in all cases where the defendant did, or neglected what is complained of, while honestly intending to act in accordance with his statutory powers and, whether reasonably or not, believing in the existence of such facts or state of things as would, if really existing, have justified his conduct; in other words, the defendant should have a bona fide belief in facts which, if they had existed, would have afforded a justification under the statute.

    11. This Article, on the very language of it, can possibly have no application to the facts of the present case. Article 36 likewise, in my opinion, has no application. It prescribes a period of one year from the date or time when the malfeasance, misfeasance or non-feasance takes place, ‘for compensation for any malfeasance, misfeasance or non-feasance independent of contract and not herein specially provided for.’ In my judgment, it is not possible to hold, upon the facts of this case, that the action has been brought for compensation for any malfeasance, misfeasance or non-feasance. The suit, as I said, is merely for recovery of money due to the plaintiff from the defendant.

    12. Mr. Goswami has relied upon certain authorities, namely, upon the cases of (i) Amar Singh v. Deputy Commissioner, Gujranwala, AIR 1937 Lab 748, (ii) Pt. Shiam Lal v. Abdul Raof, AIR 1935 All 538, (iii) Secretary of State v. Lodna Colliery Co. Ltd., AIR 1936 Pat 513, (iv) Shariful Hasan v. Lachmi Narain, AIR 1932 All. 16, and (v) Kripa Ram v. Kunwar Bahadur, AIR 1932 All 256. In my judgment, none of these cases has any resemblance to the facts of the present case. In the Lahore case, the suit was instituted for recovery of compensation by the pound-keeper for the reason that a certain number of sheep and goats which had been impounded were ordered to be released by the Deputy Commissioner acting as the Chairman of the District Board concerned AIR 1935 All 538 is a case which arose out of a suit for damages on the ground that the defendant, a Police constable, who cherished a grudge against the plaintiff, made a false report on a certain date at the Police Station concerned stating that the plaintiff was leading a riotous mob. The facts of AIR 1936 Patna 513 are also entirely different. Their Lordships of that Court observed as follows:

    “The object of the article is the protection of public officials who, bona fide purporting to act in the exercise of a statutory power, have exceeded that power and have committed a tortious act; it resembles in this respect the English Public Authorities Protection Act if the act complained of is within the terms of the statute, no protection is needed, for the plaintiff has suffered no legal wrong. The protection is needed when an actionable wrong has been committed, and to secure the protection, there must be, in the first place, a bona fide belief by the official that the act complained of was justified by the statute, secondly, the ct must have been performed under colour of a ??? duty, and thirdly, the act must be in ??? in order to give rise to the cause of action, ??? is against such actions for tort that the statute ??? protection. Article 2 has no application to suits to recover statutory compensation independently of any question of tort.”

    13. I have taken this observation from the ??? which correctly deals out the decision. The two cases in AIR 1932 All 16 are likewise quite different from the facts of the present case. On the other land, the learned counsel for the respondent has referred to certain cases to which a reference, in my opinion, is necessary. The case of Jatindra Nath Pal v. Corporation of Calcutta, AIR 1945 Cal 44 was a case for recovery of Provident Fund money from the Calcutta Corporation. In that case, the dismissal of the plaintiff from service had taken place on 29-5-36, and the suit was filed on 20-1-42 claiming the Provident Fund money standing to the ??? of the plaintiff in the Calcutta Corporation. The argument on behalf of the Corporation was that three years' limitation under Article 115 of the imitation Act applied, and the suit was barred by ??? The learned Judge negatived the contention and held that Article 120, the residuary article, applied, and not Article 115.

    14. With all respect, I entirely agree with the decision arrived at in that case. The case of Corporation of Calcutta v. Asoke Kumar De, AIR 1928 Cal. 43 is again a case for recovery of Provident Fund money. In that case, the subscriber to the Provident Fund had died on 27-11-20 and the plaintiff, his son, brought a suit for recovery of the amount to the credit of the deceased, in 1926, much more than three years after the death of his father. In that case, it was sought to be argued that under the provisions of section 538 of the Calcutta Municipal Act the suit should be held to be barred by time.

    15. Section 538 of the Calcutta Municipal Act was held to apply to suits against the Corporation in respect of an act purporting to be done under the Calcutta Municipal Act or under any rule or bye law made thereunder, and it was held that the suit for recovery of Provident Fund money could not ??? be covered by Section 538 of the Calcutta Municipal Act, and that the suit was not time-barred. The case of Tinsukia Municipal Board v. Bankim Chandra Ghose, AIR 1950 Assam 101 was also laced before me; but, in my opinion, the facts of that case are not similar.

    16. In my judgment, therefore, the Court below was correct in holding that no specific article of the limitation Act applied, and that, therefore, the ??? Article, namely, Article 120 of the Act applied, and also that Section 103 of the Assam Local Self-Government Act had no application. Mr. Goswami also referred to the payment of Rs. 2000/- to the plaintiff, and I had thought that ??? Rs. 2000/- was paid by the Board to the plaintiff, that amount of money was paid out of the money ??? to the plaintiff from the Board on account of the provident Fund Amount; but this being a question of fact and it being not at all agitated in any of the Courts below as to whether this amount was aid or, if paid, was paid towards the dues of the plaintiff on account of his Provident Fund deposits, ad no issue having been struck, it is now too late ??? take up this question of fact.

    17. The result is that the appeal fails and it is dismissed with costs.

    D/V.B.B

    18. Appeal dismissed.

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    Comments

    Jorhat Local Board v. Ambika Charan Saikia
    (Jan 4, 1960)