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Judgment Summary — Limitation Question (Joint Hindu Family; claim to profits / co-ownership)

Factual and Procedural Background

The plaintiffs are members of a joint Hindu family. A mortgage over joint family properties had been executed only by a step-brother of the plaintiffs. The defendant held that mortgage and, in execution of the decree obtained on it, became purchaser of the properties. The plaintiffs (and another deceased brother) had not been parties to the mortgage suit and resisted the defendant when he attempted possession as the execution purchaser.

The trial Court ordered removal of the plaintiffs' obstruction on 4 April 1918. On 5 April 1918 the plaintiffs filed a suit under Order 21, Rule 103, Civil Procedure Code for a declaration; soon after, when the defendant took possession, the plaint was amended to add a prayer for possession (but no prayer for future profits was added). The Subordinate Judge dismissed the suit on 22 March 1921. On appeal the District Court reversed and, on 13 October 1921, decreed partition and possession of a five-sevenths share in the properties. A second appeal was dismissed by the High Court on 3 October 1923. The plaintiffs obtained possession of their share by May 1922.

The plaintiffs maintained entitlement to five-sevenths of profits from the properties for the period 1918–1922 (profits received annually around March). They instituted the present suit for profits on 30 March 1927. The suit was prima facie time-barred if Article 109 of the Limitation Act applied. The plaintiffs sought deduction under Section 14 of the Limitation Act for (1) the period while the matter was pending in Second Appeal (13 October 1921 to 3 October 1923) and (2) the period during which they prosecuted restitution proceedings (early 1924 until dismissal by this Court on 9 March 1927). The District Judge denied the benefit of Section 14 for both periods. On appeal, the plaintiffs' counsel (Mr. Somayya) relied on authority for construing "appeal" to include revision petitions and argued the restitution period should be covered. The defendant/appellant's counsel (Mr. Narasimhachari) contested various aspects on limitation and quantum.

Legal Issues Presented

  1. What period of limitation applies to the plaintiffs' claim for profits: Article 109 (three years for mesne profits) or Article 120 (six years for compensation) of the Limitation Act?
  2. Whether the plaintiffs are entitled to a deduction under Section 14 (suspension of limitation) of the Limitation Act for (a) the period of the Second Appeal and/or (b) the period of the restitution proceedings, thereby bringing the suit within time.
  3. If limitation is otherwise satisfied, whether the lower Court correctly assessed and awarded the amount of profits (mesne profits / compensation) for the relevant years.

Arguments of the Parties

Plaintiffs' Arguments (as recorded)

  • They claimed entitlement to five-sevenths share of profits for the period 1918–1922 and asked for deduction under Section 14 of the Limitation Act for the time during which (a) the Second Appeal was pending and (b) restitution proceedings were prosecuted (early 1924 to 9 March 1927).
  • Before this Court Mr. Somayya did not press Section 14 for the Second Appeal period but contended that the restitution proceedings period should be covered by Section 14; he relied on Venkatragayya Appa Rao v. Murala Sriramulu for a broad construction of "appeal" to include revision petitions and argued the plaintiffs prosecuted the restitution proceedings diligently and in good faith.

Defendant / Appellant's Arguments (as recorded)

  • The defendant/appellant (represented by Mr. Narasimhachari) argued that Article 109 should apply (i.e., the three years rule for mesne profits) and criticised the lower Judge's exclusion of Article 109 on the ground that the defendant's possession was, in some sense, under an order of Court.
  • He further argued that where a co-owner asserts exclusive ownership or denies the title of other co-owners, exclusive possession may become wrongful and limitation under Article 109 could start; he relied on various authorities to that effect.
  • On quantum, he complained that certain observations of the learned Judge misled the defendant and that the defendant omitted to examine witnesses he intended to call; he relied on the defendant's affidavit on that point.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Venkatragayya Appa Rao v. Murala Sriramulu (1912) 17 I.C. 593 Authority relied on by plaintiffs' counsel for the proposition that the word "appeal" in Section 14 may include "revision petition". The Court noted the plaintiffs relied on this decision but held that it is not sufficient: for Section 14 to apply the proceeding must have been conducted bona fide and must have failed for want of jurisdiction or like defect; thus Venkatragayya did not carry the plaintiffs' case to entitlement under Section 14.
Ganapathi Mudaliar v. Krishnamachari (1922) 43 M.L.J. 184 Cited regarding the requirements for invoking Section 14 — whether proceedings failed for want of jurisdiction or similar defect. Used by the Court to support the conclusion that the restitution proceedings did not fail for want of jurisdiction; therefore Section 14 could not be invoked.
Baisnath Lala v. Ramadoss (1914) I.L.R. 39 Mad. 62 : 27 M.L.J. 640 Authority on the character of proceedings vis-à-vis jurisdictional failure relevant to Section 14. Relied on alongside Ganapathi Mudaliar to show that the proceedings did not fail by reason of want of jurisdiction and so did not attract Section 14 relief.
Watson and Co. v. Ram Chund Dutt (1890) L.R. 17 I.A. 110 : I.L.R. 18 Cal. 10 (P.C.) Authority supporting that disputes between co-owners over income are in the nature of compensation (not mesne profits) and thus governed by the Article prescribing limitation for compensation. Invoked to show that where parties are co-owners the proper conception is a claim for compensation and not ordinary mesne profits; thus Article 120 (six years) applies rather than Article 109.
Midnapur Zamindary Co., Ltd. v. Naresh Narayan Roy (1924) L.R. 51 I.A. 293 : I.L.R. 51 Cal. 631 : 47 M.L.J. 23 (P.C.) Authority cited for the proposition that claims between co-owners are for compensation and attract the limitation period under Article 120. Referred to as supporting the view that Article 120, not Article 109, governs claims in the nature of compensation between co-owners.
Raghubans Narain Singh v. Khub Lall Singh (1931) I.L.R. 11 Pat. 22 Authority cited in the same context of characterization of claims between co-owners. Used as an additional example of cases holding the claim to be for compensation and thus governed by Article 120.
Robert Watson and Co., Ltd. v. Ram Chand Dutt (1896) I.L.R. 23 Cal. 799 Authority cited for the view that in co-ownership disputes the period of limitation is prescribed by Article 120 and not Article 109. Cited by the Court as an authority in support of the proposition that Article 120 applies to this class of case.
Midnapora Zamindary Co., Ltd. v. Naresh Narayan Roy (1916) I.L.R. 40 Mad. 291 : 30 M.L.J. 341 Authority relating to characterisation of claims between co-owners and applicable limitation period. Referred to in the same line of authorities indicating Article 120 is applicable.
Subba Rao v. Rama Rao (1916) L.R. 56 I.A. 290 : I.L.R. 57 Cal. 1 : 58 M.L.J. 74 (P.C.) Authority on the nature of claims between co-owners and the applicable limitation period. Referred to in support of the conclusion that Article 120 applies.
Gurudas Kundu Chowdhury v. Kumar Hemendra Kumar Roy (1929) L.R. 56 I.A. 290 : I.L.R. 57 Cal. 1 : 58 M.L.J. 74 (P.C.) Passage relied on by defendant's counsel suggesting possession may be "in one sense" wrongful when exercised by an alienee from a co-sharer. The Court observed the passage is guardedly expressed and declined to treat it as converting the character of such claims into those contemplated by Article 109; it did not alter the view that the present case falls under Article 120.
Nrityamoni Dassi v. Lakhan Chandra Sen (1916) I.L.R. 43 Cal. 660 : 30 M.L.J. 529 (P.C.) Authority stating that when a co-sharer asserts exclusive claim or collects income in his own exclusive right, limitation will begin to run. The Court accepted the principle as to the starting point of limitation but noted that it does not decide which Article (109 or 120) applies; it relates to the commencement, not the period applicable.
Yerukola v. Yerukola (1922) I.L.R. 45 Mad. 648 : 42 M.L.J. 507 (Full Bench) Full Bench principle that as between co-sharers the proper article applicable is Article 120 and that limitation begins from assertion of exclusive title or ouster. The Court held this Full Bench principle to be clearly applicable to the present facts and applied it to conclude Article 120 governs the suit.
Muttusami v. Rama Krishna (1889) I.L.R. 12 Mad. 292 Authority concerning character of possession by alienees from a co-sharer and the commencement of limitation from taking of possession by alienees. The Court observed it shows limitation will begin from the date alienees took possession but does not determine whether Article 109 or 120 applies; it does not advance the main contention for Article 109.
Sheik Abdul Gafur v. Ashamath Bibi (1919) 11 L.W. 31 Cited on the character of possession of alienees from co-sharers. Noted as not carrying the defendant's argument further; it pertains to commencement of limitation, not the applicable Article.
Thiagaraja Pillai v. Appavoo Pillai (1930) M.W.N. 246 Cited regarding possession by alienees and commencement of limitation. The Court recorded it as not advancing the defendant's contention about the applicable Article; it concerns when limitation begins.
Perumal Udayar v. Krishnama Chettyar (1894) I.L.R. 17 Mad. 251 Cited by the learned Judge below; a case in which no question of limitation arose because suit was within three years of attainment of majority. The Court noted that no question of limitation arose in that case and therefore it does not assist the present controversy on limitation.
Pirthi Pal and Uman Parshad v. Jowahir Singh (1887) 14 I.A. 37 : I.L.R. 14 Cal. 493 at 509 (P.C.) Authority dealing with the right to profits (substance of right) rather than limitation. The Court observed that the observations in this case deal with right to profits and not with the question of limitation and so do not help in deciding the limitation issue.
Shankar Baksh v. Hardeo Baksh (1888) L.R. 16 I.A. 71 : I.L.R. 16 Cal. 397 at 413 (P.C.) Authority concerning right to profits rather than limitation. The Court noted it is not helpful on the question of limitation because it deals with right to profits.

Court's Reasoning and Analysis

  1. Section 14 analysis (suspension / deduction of limitation): The Court explained that for Section 14 to apply it is not enough to broaden the meaning of the word "appeal" to include other proceedings. Two conditions must be satisfied: (a) the proceeding must have been prosecuted bona fide (good faith as defined in the Limitation Act, implying due care and attention), and (b) the proceeding must have failed for want of jurisdiction or some similar defect. The Court concluded the restitution proceedings were not shown to have failed for want of jurisdiction and the plaintiffs had not established the necessary bona fides in a sense that would attract Section 14. Accordingly, the District Judge was correct in denying Section 14 relief for both periods the plaintiffs sought to deduct.
  2. Characterisation of the claim and applicable Article: The Court considered whether the action was one for "mesne profits" under Article 109 or for "compensation" under Article 120. It observed that the plaintiffs claimed only a five-sevenths share and the defendant (as purchaser of the mortgagor's interest) would be entitled to the remaining two-sevenths; thus the parties were in the position of co-owners. The Court reasoned that the first column of Article 109 assumes property belonging to the plaintiffs alone and profits wrongfully received by the defendant — conditions not met between co-owners. Reliance was placed on authorities holding that disputes between co-owners over income are claims for compensation (not mesne profits) and that Article 120 therefore applies.
  3. Consideration of authorities relied on by defendant: The Court addressed the defendant's argument that exclusive possession by one co-owner can in some cases be wrongful (and so Article 109 might apply). It considered the authorities cited, including guarded language in Gurudas Kundu Chowdhury and Nrityamoni Dassi on when limitation begins. The Court distinguished the issue of when limitation begins (commencement) from what the applicable period is (Article 109 or 120). It concluded that these cases did not show that Article 109 applied to the present case and accepted the Full Bench principle in Yerukola v. Yerukola that Article 120 governs such disputes between co-sharers.
  4. Quantum and evidence: On the challenge to the mesne-profits award for the later two-year period, the Court reviewed affidavits and the trial Judge's factual findings. It found the defendant's affidavit contradicted by the plaintiffs' counsel's affidavit and noted public records and the written statement primarily related to 1920–1921 as the bad year. The trial Judge had awarded a smaller amount for that year and a larger amount for the next year; the appellate Court found no reason to overturn the trial Judge's appreciation of the evidence and saw no force in the objection about non-examination of intended witnesses.

Holding and Implications

Final Disposition: The Court dismissed both the appeal and the memorandum of objections. The dismissal was ordered without costs.

Core Ruling: The Court held that the suit is governed by the six-years rule of limitation under Article 120 of the Limitation Act (not Article 109) because the dispute is between co-owners (plaintiffs claiming five-sevenths and defendant having two-sevenths) and the claim is in the nature of compensation rather than ordinary mesne profits.

Consequences for the Parties: As applied by the courts below and affirmed here, the plaintiffs were entitled only to profits for the two later years (those received in March 1921 and March 1922); claims for the earlier years (profits of March 1919 and March 1920) were time-barred. The plaintiffs were not permitted to deduct the periods they sought under Section 14, and the quantum awarded by the lower Court for the two-year period was upheld on the record.

Broader implications: The Court applied and followed existing Full Bench authority (Yerukola v. Yerukola) and other precedents on the characterisation of claims between co-owners. The decision affirms the established principle that such claims are governed by Article 120; the Court did not indicate that it was creating new law.

    Pateel Siddalingana Gowd . v. Tatana Gowdra Bhimana Gowd And Others

    1. This appeal raises a question of limitation in the following circumstances.

    2. The plaintiffs are members of a joint Hindu family. The defendant held a mortgage over certain joint family properties but that mortgage had been executed only by a step-brother of the plaintiffs. In execution of the decree obtained on that mortgage the defendant himself became the purchaser of the properties, but as the plaintiffs and another deceased brother of theirs were not parties even to the suit on the mortgage, they resisted the defendant when he attempted to take possession as execution purchaser. The Court ordered their obstruction to be removed by an order, dated 4th April, 1918; and on the 5th April, the plaintiffs filed a suit under Order 21, Rule 103, Civil Procedure Code, for a mere declaration. As shortly thereafter, the defendant took possession, that plaint was amended by the addition of a prayer for possession, but it did not occur to anybody to add a prayer for future profits as well. The suit for possession was ultimately heard by the Subordinate Judge and dismissed on the 22nd March, 1921, but on appeal the District Court reversed the decree of the Subordinate Judge and gave the plaintiffs a decree for partition and possession of five-sevenths share in the suit properties. This decree was passed on 13th October, 1921. A second appeal against that decree was dismissed by the High Court on 3rd October, 1923. In execution of the decree of the District Court the plaintiffs got possession of their share of the properties by May 1922. On the facts above stated there can be no doubt that the plaintiffs are entitled to five-sevenths share in the profits received from these properties for four years, i.e., between 1918 and 1922; and on the allegations in the written statement, it is clear that the profits are received each year some time about March. This suit was instituted only on the 30th March, 1927 and it will be prima facie barred by limitation if Article 109 applied. The plaintiffs claimed that even under the three years rule of limitation they would be in time if they were allowed a deduction under Section 14 of the Limitation Act, (1) in respect of the period during which the matter was pending in Second Appeal here i.e., between 13th October, 1921 and 3rd October,1923 and (2) in respect of the period during which they were prosecuting certain proceedings by way of a claim for restitution. These latter proceedings were pending from early in 1924 till 9th March, 1927 when they were ultimately dismissed by this Court. The learned District Judge has held that the plaintiffs are not entitled to invoke the benefit of Section 14 of the Limitation Act in respect of either of these periods. Before us Mr. Somayya did not contend that Section 14 could be made applicable to the period of the pendency of the Second Appeal, but he maintained that the period during which the restitution proceedings were pending would be covered by Section 14 of the Limitation Act. He relied upon the decision of a Bench of this Court in Venkatragayya Appa Rao v. Murala Sriramulu (1912) 17 I.C. 593 as laying down that the word 'appeal' in Section 14 would also include "Revision Petition" and he argued that in the circumstances of the present case there could be no doubt that the plaintiffs had been prosecuting the restitution proceedings diligently and in good faith.

    3. For the purpose of the application of Section 14 it is not sufficient merely to say that the word "appeal" will include "Revision Proceedings" as well. We must be satisfied that the proceeding was being conducted bona fide and that it failed on the ground of want of jurisdiction or other defect of a like nature. The definition of 'good faith' in the Limitation Act itself, will show that it must be the result of due care and attention. It is difficult to hold that by any reasonable construction of section 144 of the code, the present case could have been believed to fall under that Section. Further, in view of the decisions of this Court in Ganapathi Mudaliar v. Krishnamachari (1922) 43 M.L.J. 184 and Baisnath Lala v. Ramadoss (1914) I.L.R. 39 Mad. 62 : 27 M.L.J. 640 it is not possible to say that the proceeding failed by reason of want of jurisdiction or other cause of a like nature. The mere fact that the plaintiffs might have honestly believed that they could get all that they are entitled to by way of proceedings in restitution will not suffice to give them the benefit of Section 14. We must therefore hold that the learned Judge was right in his view that the plaintiffs are not entitled to claim a deduction of either of the above periods.

    4. The learned Judge has however held that the suit is governed not by the three years rule of limitation under Article 109 of the Limitation Act but by the six years rule under Article 120. On this basis, he found that the plaintiffs would be entitled only to two years profits i.e., those received in March,. 1921, and March, 1922 but their suit would be out of time in respect of the earlier two years i.e., the profits received in March, 1919, and March, 1920. The appellant-defendant objects to this decree in so far as it allowed the plaintiffs' claim even for the two later years, the plaintiffs have filed a memorandum of objections claiming that the lower Court should have allowed profits even for the first two years. As we have already held that the plaintiffs are not entitled to the deduction of any period under Section 14 of the Limitation Act, the Memorandum of Objections fails. As regards the appeal Mr. Narasimhachari maintained that the learned Judge was not right in excluding the applicability of Article 109, merely on the ground that the defendant's possession in this case was in a sense under an order of a Court of law. This portion of the learned Judge's judgment is no doubt open to that criticism and in view of the decisions in Savarimuthu v. Aitkurusu Rowthar (1901) I.L.R. 25 Mad. 103 : 11 M.L.J. 428 (F.B.). Rangaswami Kavundan v. Alagayamman (1914) 2 L.W. 169 and Saraj Ranjan Choudhury v. Premchand Choudhury (1917) 22 C.W.N. 263 it will not be possible to maintain that position. But this conclusion is nevertheless right on another ground. The suit is not really one for 'mesne profits' as ordinarily understood nor even one of the description more fully set out in the first column of Article 109. According to the plaintiffs' case, they were entitled only to five-sevenths share in the properties and the defendant as purchaser of the mortgagor's interest would be entitled to two-sevenths-share in the property so that the parties were really in the position of co-owners. The first column of Article 109 speaks of property belonging to the plaintiffs and also of the profits thereof having been 'wrongfully' received by the defendant. Though the expression mesne profits is not used, this description in the first column corresponds very closely to the definition of mesne profits in Clause (12) of Section 2, Civil Procedure Code. Neither of the conditions assumed by the first column can properly apply as between co-owners, because in such a case the property cannot be said to belong to the plaintiffs alone nor could the profits received by the other co-owners be held to have been wrongfully received by them. That is why, in several cases, it has been held that the proper conception even in respect of a claim in the nature of damages as between co-owners is that it is a claim for compensation and not a claim for mesne profits (See) Watson and Co. v. Ram Chund Dutt (1890) L.R. 17 I.A. 110 : I.L.R. 18 Cal. 10 (P.C.), Midnapur Zamindary Co., Ltd. v. Naresh Narayan Roy (1924) L.R. 51 I.A. 293 : I.L.R. 51 Cal. 631 : 47 M.L.J. 23 (P.C.) and Raghubans Narain Singh v. Khub Lall Singh (1931) I.L.R. 11 Pat. 22. It has also been held that in such cases the period of limitation is that prescribed by Article 120 and not that prescribed by Article 109 See Robert Watson and Co., Ltd. v. Ram Chand Dutt (1896) I.L.R. 23 Cal. 799 The Midnapora Zamindary Co., Ltd. v. Naresh Narayan Roy (1916) I.L.R. 40 Mad. 291 : 30 M.L.J. 341 and Subba Rao v. Rama Rao (1916) L.R. 56 I.A. 290 : I.L.R. 57 Cal. 1 : 58 M.L.J. 74 (P.C.). Mr. Narasimhachari, however contended that even as between co-owners exclusive possession by one may sometimes become wrongful especially when he is in possession in assertion of a right to the whole and denies the title of the other co-owners to any share. He relied upon a passage in Gurudas Kundu Chowdhury v. Kumar Hemendra Kumar Roy (1929) L.R. 56 I.A. 290 : I.L.R. 57 Cal. 1 : 58 M.L.J. 74 (P.C.) and on certain observations in Nrityamoni Dassi v. Lakhan Chandra Sen (1916) I.L.R. 43 Cal. 660 : 30 M.L.J. 529 (P.C.). The passage in Gurudas Kundu Chowdhury v. Kumar Hemendra Kumar Roy (1929) L.R. 56 I.A. 290 : I.L.R. 57 Cal. 1 : 58 M.L.J. 74 (P.C.) is guardedly expressed as their Lordships speak of the possession being "in one sense" wrongful, for otherwise there will be no claim to compensation at all. It will not be fair to interpret that sentence to mean that the claim is really one of the kind contemplated by Article 109. As regards the case in Nrityamoni Dassi v. Lakhan Chandra Sen (1916) I.L.R. 43 Cal. 660 : 30 M.L.J. 529 (P.C.) it no doubt lays down that from the time that a co-sharer asserts exclusive claim or collects the income in his own exclusive right, limitation will begin to run; but we are now dealing with the question of the period of limitation and not with the starting point. The judgment of a Full Bench of this Court in Yerukola v. Yerukola (1922) I.L.R. 45 Mad. 648 : 42 M.L.J. 507 (F.B.) also lays down that as between co-sharers, the proper article applicable is Article 120 and that limitation will begin to run from the time that there is an assertion of exclusive title or what may amount to ouster. The cases cited by Mr. Nara-simhachari in respect of the character of the possession held by alienees from a co-sharer, viz., Muttusami v. Rama Krishna (1889) I.L.R. 12 Mad. 292, Sheik Abdul Gafur v. Ashamath Bibi (1919) 11 L.W. 31 and Thiagaraja Pillai v. Appavoo Pillai (1930) M.W.N. 246 do not carry this part of the case any further. On the principle recognised by the Full Bench in Yerukola v. Yerukola (1922) I.L.R. 45 Mad. 648 : 42 M.L.J. 507 (F.B.) they only show that limitation will begin to run as from the date when the alienees took possession, but they do not show what the period of limitation applicable is - whether it is under Article 109 or Article 120. The learned Judge has relied upon Perumal Udayar v. Krishnama Chettyar (1894) I.L.R. 17 Mad. 251 but no question of limitation arose in that case, because the suit was held to have been instituted within three years of the plaintiff's attainment of majority. Similarly the observations in Pirthi Pal and Uman Parshad v. Jowahir Singh (1887) 14 I.A. 37 : I.L.R. 14 Cal. 493 at 509 (P.C.) and those in Shankar Baksh v. Hardeo Baksh (1888) L.R. 16 I.A. 71 : I.L.R. 16 Cal. 397 at 413 (P.C.) do not help us in dealing with this question. They deal with the question of the right to profits and not with the question of limitation.

    5. The principle of the Full Bench judgment in Yerukola v. Yerukola (1922) I.L.R. 45 Mad. 648 : 42 M.L.J. 507 (F.B.), is clearly applicable here and the suit must be held to be governed by the six years rule of limitation prescribed by Article 120.

    6. On behalf of the appellant, Mr. Narasimhachari also took exception to the amount awarded by the Court below in respect of the mesne profits for the second period of two years. He contended that the defendant had been misled by some observations of the learned Judge and that he had not therefore examined some more witnesses whom he intended to examine. The defendant's affidavit on this point is contradicted by the affidavit filed by the learned Counsel who appeared for the plaintiffs in the lower Court. But even apart from that, the affidavit itself suggests that the evidence available, at any rate from public records, related only to the year 1920-1921, and in the written statement also, it was only that year that was claimed to have been a bad year. That fact was admitted even in the plaint and the learned Judge has taken due note of it and awarded a much smaller amount for that year than for the next year. In these circumstances, we see no force in the point about the non-examination of some witnesses whom the defendant intended to examine. Mr. Narasimhachari also took exception to the statement of the learned Judge that only D.W. 1 spoke to the failure of the crops and not any other witness. But the statement of the other witnesses is quite vague and we do not see any reason to differ from the learned 3udge in his appreciation of the evidence as to mesne profits.

    7. The result therefore is that the appeal and the memorandum of objections are both dismissed, but in the circumstances without costs.

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    Pateel Siddalingana Gowd . v. Tatana Gowdra Bhimana Gowd And Others
    (Oct 23, 1934)