Defendants in a regular second appeal argued suit recovery of contractor dues was barred by limitation. The court held Section 18 of the Limitation Act applied since defendant acknowledged liability by part payment after legal notice, giving fresh limitation; also limitation is a mixed question not raisable first time. Appeal dismissed.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
NC: 2024:KHC:30944 RSA No. 403 of 2016
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 5TH DAY OF AUGUST, 2024
BEFORE
THE HON'BLE MRS JUSTICE K.S. HEMALEKHA
REGULAR SECOND APPEAL NO. 403 OF 2016 (MON)
BETWEEN:
Digitally signed by MAHALAKSHMI B M Location: HIGH COURT OF KARNATAKA
…APPELLANTS
(BY SRI. CHANNEGOWDA, ADVOCATE)
AND:
…RESPONDENTS
(BY SRI. SARAVANA S, ADVOCATE FOR R1; SRI. RAJENDRA K.R, AGA FOR R2)
THIS REGULAR SECOND APPEAL IS FILED UNDER SECTION 100 OF CODE OF CIVIL PROCEDURE, AGAINST THE JUDGMENT AND DECREE DATED 18.08.2015 PASSED IN RA NO.84/2013 ON THE FILE OF THE ADDITIONAL SENIOR CIVIL JUDGE AND CHIEF JUDICIAL MAGISTRATE., MANDYA, PARTLY ALLOWING THE APPEAL AND MODIFYING THE JUDGMENT AND DECREE DATED 03.06.2013 PASSED IN OS NO.163/2009 ON THE FILE OF THE PRINCIPAL CIVIL JUDGE, JUDICIAL MAGISTRATE FIRST CLASS MANDYA.
THIS APPEAL, COMING ON FOR FURTHER HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:
CORAM: HON'BLE MRS JUSTICE K.S. HEMALEKHA
ORAL JUDGMENT
Assailing the legality and correctness of the
judgment and decree in RA. No.84/2013 dated 18.08.2015 on the file of the Addl.Senior Civil Judge & CJM, Mandya, the defendants are before this Court in the Regular Second Appeal.
framed the following substantial question of law on 05.01.2018:
submits that the claim of the plaintiff was for December 2003 for Rs.9,600/-, 20.03.2006 for Rs.21,575/- and 30.12.2005 for Rs.41,650/- and suit was filed by the plaintiff on 03.04.2009, the counsel taking this Court to Section 3 of the Limitation Act, 1963 (“the Act” for short) submits that the claim was barred by limitation. That the Courts below have committed a grave error in decreeing the suit of the plaintiff insofar as item Nos.1 and 3. Learned counsel has placed reliance on the decision of the Orissa High Court in the case of Jagmohan Garnaik and others vs. Sankar Samal and others,1 and submits that the substantial question of law framed by this Court is answered in favour of the appellant.
1 AIR 1990 ORISSA 124
amount of Rs.2,13,165/-, submits that defendant No.1 had made payment of Rs.80,640/- to the plaintiff and nonpayment of the remaining amount of Rs.1,32,525/-, the present suit is filed and defendant No.1 having admitted his liability, Section 18 of the Act comes to the aid of the plaintiff. Learned counsel submits that the claim of the plaintiff seeking recovery of money is continuing liability and is a mixed question of law and fact. Further, the defendants have neither raised the question of limitation in the written statement nor preferred an appeal against the decreetal of the suit having held by the trial Court that the suit is within limitation, the defendants are estopped from raising the question of limitation before this Court for the first time by bypassing the first appellate Court. Learned counsel has placed reliance on the decision of the Apex Court in the case of Banarsi Das vs. Kanshi Ram and others2 .
2 AIR 1963 SCC 1165
recovery of suit claim amount of Rs.1,59,030/- with interest at the rate of 12% per annum from the date of suit till the date of realization. The plaint avers that the plaintiff is a registered Class-I contractor in civil works and defendant No.1 is the concerned Authority for executing
the works pertaining to water supply and drainage in Mandya District, that the plaintiff completed the work assigned and raised various bills, details of the said works as mentioned in Annexure-1 of the plaint. The claim of the plaintiff was Rs.85,275/- towards Item Nos.2, 3, 4 and 5, which are pertaining to security deposits and pending payment in respect of the security deposits furnished at the time of entering into the agreement for a sum of Rs.5,650/- and further, security deposit of Rs.9,600/totaling to Rs.1,32,575/-. The plaintiff contended that defendant No.1 was in due of Rs.2,13,165/-, the plaintiff issued legal notice on 07.08.2007, subsequent to which defendant No.1 made a payment of Rs.80,640/- to the plaintiff, and defendant No.1 was due in a sum of
Rs.1,32,525/-. The plaintiff contended that the amount due is Rs.1,32,525/- and the damages at 12% per annum from 01.08.2007 to 01.04.2009 amounting to Rs.26,505/and the suit claim raised was for an amount of Rs.1,59,030/-. On notice, defendant Nos.1 and 2 have appeared and only defendant No.1 filed the written statement. Defendant No.1 contended that item No.2 of Annexure - 1 an amount of Rs.21,575/- and including the balance amount of Rs.1,905/- totaling to Rs.23,480/- has already been paid on 04.04.2006 under voucher No.48 dated 24.04.2006 and the same has been entered in the passbook of the plaintiff. In respect of other items, defendant No.1 contended that the necessary particulars have been forwarded to the 2nd defendant and the said amount is pending with the 2nd defendant and deferring his liability in respect of other items. The Trial Court on the basis of the pleadings, has framed the following issues:
“(1) Whether the plaintiff proves that the defendant No.1 is due to pay a sum of
NC: 2024:KHC:30944 RSA No. 403 of 2016
Rs.1,32,525/- to plaintiff towards contract work done by him?
(2) Whether the suit is not maintainable for want of jurisdiction?
(3) Whether the plaintiff is entitled for suit claim amount of Rs.1,59,030/- along with interest from all the defendants?
(4) Whether the plaintiff is entitled for the relief as sought for?”
oral and documentary evidence on record, has partly decreed the suit holding that the defendants No.1 and 2 are hereby jointly and severally directed to pay a sum of Rs.1,09,045/- with interest at the rate of 9% per annum from 01.08.2007 to 01.04.2009. The claim of item No.2 was rejected holding that defendant No.1 has paid the said amount as per Ex.D4.
8. Aggrieved, the plaintiff preferred the appeal
before the First Appellate Court. The First Appellate Court re-appreciated the entire oral and documentary evidence,
modified the decree of the Trial Court holding that the plaintiff is entitled for Rs.1,30,620/- together with interest at the rate of 9% per annum from the date of suit till realization.
ANNEXURE-1
| Sl. | Name of Work | Agreement | Due | Actual | Date of | Amou | nt due to b | epaid | ||
|---|---|---|---|---|---|---|---|---|---|---|
| No. | No. & date | date of comple- tion of work as per Agreem -ent |
date of comple- tion of work |
expiry of one year mainte- nance (Defect Liability period since comple- tion) |
By way of Settle- ment of Final Bill (Rupees) |
Bid Security furnished at the time of Bidding (Rupees) |
Security furnished of the time of entering into Agree- ment |
Further Security recovered in work Bills (Rupees) |
Total amount (7+8+9+ 10) (Rupees) |
|
| 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 |
| 1 | Laying jointing 450 mm dia RCC pipes for sludge disposal from treatment plant and construction of sludge disposal from chamber under RWSS to Malavalli Town and enroute villages. |
2/02-03 16.1.03 |
17.3.03 | December 2003 |
December 2004 |
- | - | - | 9600 (Approxi- mately) |
9600 |
| 2 | Conveying laying,Jointing |
18/04-05 5.7.04 |
5.11.04 | 20.03.05 | 20.03.0 6 |
- | 21575 | - | - | 21575 |
NC: 2024:KHC:30944 RSA No. 403 of 2016
& Testing &
Commissioning
of PVC
Distribution
Network in II
Stage W/s
scheme to KR
Pete Town
under AUWSP
3 Construction of 25/03-04 9.01.05 0.12.04 30.12.0 - 36000 5650 - 41650
Type VI and VII 15.11.03 5
Quarters at
Head works and
Treatment plant
under RWSS to
Maddur and
Malavalli Town
4 Providing Water 2/05-06 9.07.05 15.10.0 15.10.0 - 9200 - - 9200
Supply 19.4.05 5 6
Distribution
System to
Pandavapura
Town under
AUWSP
5 Fixing water 03/05-06 - 15.4.06 15.4.07 28000 22500 - - 50500
meters along 20.4.05 (Approxi-
with necessary mately
materials in
Mandya Town
under AM of
2004-05
Total 132525
that the claim in respect of item Nos. 2 and 3 is barred by limitation. Section 3 of the Limitation Act envisages that every suit instituted, appeal preferred, and application made after the prescribed period shall be dismissed, although limitation has not been set up as a defence. The decision in Jagmohan's case stated supra placed reliance
by the appellant's counsel the High Court of Orissa observes that a Court can dismiss a suit on the ground of limitation even if the defence has not been raised the plea of limitation, when on the face of the pleadings, the Court comes to the conclusion that the suit is barred by limitation. This Court has absolutely no quarrel with the settled proposition of law, however, the facts in the present case are distinguishable and the decision of Jagmohan’s case is not applicable to the present case on hand.
or right is claimed, or by any person through whom it derives his title or liability, a fresh period of limitation shall be computed from the time when the acknowledgement was so signed. Defendant No.1 acknowledged the liability and made payment pursuant to the legal notice dated 07.08.2007 which is not in dispute and Section 18 plays role in the present facts giving rise to a fresh period of limitation. The claim of item No. 2 was due on 20.03.2006, the plaintiff issued legal notice on 07.08.2007, defendant No.1 by payment of Rs.80,640/acknowledged the liability and the period of limitation starts from 07.08.2007 and the suit is filed by the plaintiff on 03.04.2009 which is well within limitation. One more aspect which needs to be considered here is that, the Trial Court decreed the suit of the plaintiff holding that the defendant Nos.1 and 2 are jointly and severally liable to pay a sum of Rs.1,09,045/-. Against the rejection of item No.2, the plaintiff preferred an appeal before the First Appellate Court. The defendants did not choose to prefer any appeal against the decreetal of the suit in part. The
First appellate Court re-appreciated the judgment and decree of the Trial Court and held that item No.2 - an amount of Rs.21,575/- as per Ex.D-4 is deposited on 04.04.2006 whereas, voucher No.48 is dated 24.04.2006, which is after the alleged passbook entry and thus contentions of defendant No.1 that they have paid an amount of Rs.21,575/- was rightly disbelieved by the First Appellate Court.
"15. The High Court has overlooked the fact that even upon the argument addressed before it on behalf of Kanshi Ram, the question of limitation was not one purely of law but was a mixed question of fact and law and, therefore, it was not proper for it to be raised for the first time in argument. We are satisfied that what the High Court has done has caused prejudice to some of the parties to the suit and on that ground alone, we would be justified in setting aside its decision. If the High Court felt overwhelmed by the provisions of Section 3 of the
NC: 2024:KHC:30944 RSA No. 403 of 2016
Limitation Act, it should at least have given an opportunity to the parties which supported the decree of the trial court to meet the plea of limitation by amending their pleadings. After allowing the pleadings to be amended, the High Court should have framed an issue and remitted it for a finding to the trial court. Instead of doing so, it has chosen to treat the pleading of one of the defendants as conclusive not only on the question of fact but also on the question of law and dismissed the suit. It is quite possible that had an opportunity been given to the defendants, they could have established, in addition to proving the dates on which the summonses were served, that the suit was not barred by time because of acknowledgments. In the course of the discussion, the High Court has said that it was not suggested before it by anyone that the claim was not barred by reason of acknowledgments. Apparently, no such argument was advanced before it on behalf of the plaintiff and the defendant Banarsi Das because the counsel were apparently taken by surprise and had no opportunity to obtain instructions on this aspect of the case. We are clearly of opinion that the High Court was in error in allowing the plea of limitation to be raised before it particularly by defendants who had not even filed a written statement in the case. We do not think that this
was a fit case for permitting an entirely new point to be raised by a non-contesting party to the suit."
limitation is not one purely of law but a mixed question of fact and law and therefore, it was not proper for it to be raised for the first time in argument and observed that the High Court was in error in allowing the plea of limitation raised before it particularly by the defendants who have not even filed written statement in the instant case. The defendant though filed written statement, did not raise a plea of limitation as in the instant case. The question of limitation was not one purely question of law, but was a mixed question of fact and law for the facts stated supra and the said decision in Banarasi Das is aptly applicable to the facts and circumstances of the instant case. The substantial question of law framed by this Court is answered against the appellants and this Court pass the following:
ORDER
NC: 2024:KHC:30944 RSA No. 403 of 2016
Addl. Senior Civil Judge & CJM, Mandya is hereby
confirmed.
Sd/(K.S. HEMALEKHA) JUDGE
SNC List No.: 1 Sl No.: 32 CT: BHK
2 issues framed by the court
Was the suit for recovery of contractor dues barred by limitation despite the defendant's part payment after a legal notice?
Could the plea of limitation be raised for the first time in second appeal when not raised in the written statement?
Colour shows how this judgement treated each authority
Jagmohan Garnaik and others vs. Sankar Samal and othersDistinguished¶10
AIR 1990 ORISSA 124 · Who else cites this
Banarsi Das vs. Kanshi Ram and othersRelied on¶13
AIR 1963 SCC 1165 · Who else cites this
3 provisions across 2 enactments
The Executive Engineer, Karnataka Urban Water Supply & Drainage Board
The Chief Engineer, Karnataka Urban Water Supply & Drainage Board
The Secretary, Karnataka Urban Water Supply & Drainage Board
M. Anand
The Chief Secretary, Government of Karnataka
K.S. Hemalekha
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
