The Limitation Act, 1963 - 1 | Civil Law for Judiciary Exams PDF Download

Introduction

• The term "limitation" refers to a restriction or rule determining a specified timeframe for legal actions.
• The Law of Limitation sets the time limit for individuals to seek legal redress through suits or proceedings.
• Section 2 (j) of the Limitation Act, 1963 defines "period of limitation" and "prescribed period."

Main Objects of the Law of Limitations

• Long dormant claims lack justice and may lead to cruelty.
• Allowing claims to remain dormant can result in the loss of evidence for the defendant.
• Individuals with legitimate causes of action should pursue them promptly.

Doctrine of Limitation and Prescription

• Based on two key considerations: non-exercised rights are deemed non-existent, and property-related rights should not remain uncertain.

Purpose of Limiting Legal Actions

• The objective is to prevent perpetual litigation and ensure equity and justice.
• The concept establishes a timeframe within which remedies can be sought, promoting timely resolution of disputes.

Statute of the Limitation Act, 1963

• Focuses on preventing disputes from lingering indefinitely and aims to serve public interest while saving time.
• The statute does not aim to diminish rights but rather provides a framework for seeking remedies within a defined period.

Legal Remedies and Public Policy

• The legal remedy's purpose is to address harm resulting from legal injury.
• Statutes of Limitations encourage timely action and discourage stale claims.

Law of Limitation

Two aspects of Statutes of Limitation:

• Extinguishment of the right if a claim or action is not commenced within a specific time.
• Merely bars the claim without affecting the right, which can remain as a moral obligation.

Significance of Limitation Act

• Limitation Act is based on public policy to set a timeframe for legal remedies for general welfare.
• It ensures parties seek timely remedies and fixes a lifespan for legal actions.
• Maxim 'interest reipublicae ut sit finis litium' emphasizes that legal remedies must be available for a legislatively fixed time.

Nature of Limitation Laws

• Limitation laws are procedural, not substantive, focusing on procedural rules without creating rights or causes of action.
• They aim to prevent dilatory tactics and ensure timely pursuit of remedies.
• While the remedy may be barred, the right itself continues to exist beyond the limitation period.

Application of Limitation Act

• Limitation Act applies to suits by the plaintiff, not to rights set up by the defendant in defense.
• Defendants can raise defenses not available to them as plaintiffs, except in cases of set off and counterclaims.
• Set off and counterclaims are treated separately and deemed to be instituted on specific dates.

Legal Framework in India

The law governing Limitation in India is the Limitation Act of 1963, which consolidates principles related to time limits in legal proceedings.

Salient Features of the Limitation Act

• The Limitation Act of 1963 comprises 32 Sections and 137 Articles, categorized into 10 parts.
• The parts cover various aspects such as accounts, contracts, declarations, decrees, immovable property, movable property, torts, trusts, miscellaneous matters, and suits with no prescribed period.
• Diverse limitation periods exist for different types of suits, ranging from 1 to 30 years.

Reduction in Limitation Periods

• The limitation period has been reduced from 60 years to 30 years for specific suits like redemption or recovery of possession of mortgaged immovable property.
• Longer periods, such as 12 years, are prescribed for suits concerning immovable property, trusts, and endowments.

Variability in Limitation Periods

• Suits related to accounts, contracts, declarations, decrees, instruments, movable property have a limitation period of 3 years.
• Suits related to torts and miscellaneous matters have limitation periods ranging from 1 to 3 years.
• For suits without a specified limitation period, the minimum period is set at 1 week.

Appeals

• The Act allows a minimum of 7 days for appeals against death sentences, which has been extended to 30 days.

Avoidance of Illustrations

• The Act strives to avoid unnecessary and potentially misleading illustrations, following recommendations from the Third Report of the Law Commission.

Expanded Definitions

• The Act broadens definitions such as 'application,' 'plaintiff,' and 'defendant' to encompass a wider scope of court proceedings.
• It includes individuals who receive applications, plaintiffs, defendants, or those represented by executors, administrators, or other representatives.

Judicial Academy Jharkhand

• Sections 86 and Section 87 of the Civil Procedure Code necessitate Central Government consent before suing foreign rulers, ambassadors, and envoys.
• The Limitation Act, 1963 states that the time taken for obtaining such consent is excluded when calculating the limitation period for these suits.

Equality under the Limitation Act, 1963

• The new law in the Limitation Act, 1963 emphasizes equality without racial or class distinctions, encompassing Hindu and Muslim laws.
• In the case of Syndicate Bank v. Prabha D. Naik (AIR 2001 SC 1968), the Supreme Court highlighted that the law of limitation in the Act is impartial, devoid of racial or class bias.

Explanation with Examples

• For instance, in a scenario where a party needs to sue a foreign ambassador, consent from the Central Government is mandatory according to Sections 86 and 87 of the Civil Procedure Code.
• Consider a situation where an individual wants to file a lawsuit against a foreign ruler. The time taken to acquire consent from the Central Government is not included in the calculation of the limitation period as per the Limitation Act, 1963.
• Imagine a case where a person, irrespective of their background, wishes to invoke the law of limitation. The Act ensures that both Hindu and Muslim laws are equally applicable without any discrimination based on race or class.

Limitation Act, 1963

• Contains 32 Sections (Section 32 repealed) and 137 Articles.

Scheme of Articles

• Articles 1 to 113
• Suits
• Articles 114 to 117
• Appeals and Applications
• Articles 118 to 137

Classes of Suits

Suits are divided into 10 classes:

• Suits relating to accounts (Art. 1 to 5)
• Suits relating to contracts (Art. 6 to 55)
• Suits relating to declarations (Art. 56 to 58)
• Suits relating to decrees and instruments (Art. 59 to 60)
• Suits relating to immovable property (Art. 61 to 67)
• Suits relating to movable property (Art. 63 to 71)
• Suits relating to tort (Art. 72 to 91)
• Suits relating to trusts and trust property (Art. 92 to 96)
• Suits relating to miscellaneous matters (Art. 97 to 112)
• Suits for which there is no prescribed period (Art. 113)

Examples:

• A suit related to accounts could involve a dispute over financial records between two parties.
• In a suit concerning contracts, the issue might revolve around the breach of a business agreement.

Conclusion

The Limitation Act, 1963 organizes suits into distinct classes based on the nature of the legal matters involved.

Judicial Academy Jharkhand: Limitation of Suits, Appeals, and Applications (Sections 3 to 11)

Section 3

Every suit, appeal, or application filed after the prescribed period will be dismissed, regardless of whether the defense of limitation has been raised.

Definition of when a suit is considered instituted:

• In the ordinary course, a suit is instituted when the plaint is submitted to the proper officer.
• For a pauper, it is instituted when the application for leave to sue as a pauper is made.
• In the case of a claim against a company under court-ordered liquidation, it is considered instituted when the claimant first submits the claim to the official liquidator.
• Any claim by way of set off or counter claim is treated as a separate suit and is deemed to be instituted accordingly.

Explanation of Section 3 of the Limitation Act:

• The court is mandated to dismiss any suit, appeal, or application filed after the prescribed limitation period, regardless of whether the defense of limitation is raised by the opponent.
• The court is obligated to refrain from proceeding with an application made beyond the limitation period.
• Even if a suit is decided on its merits without considering the provisions of Section 3, the decree is not null and void but can be rectified as per the procedures of the Civil Procedure Code.

Understanding the Limitation Period:

• Section 3 defines the time frame after which a suit or proceeding would be barred.
• The right to sue and the starting point of the limitation period depend on the date when the cause of action arises.
• Cause of action refers to the facts that give an individual the right to seek legal remedies against another party.
• Section 3 specifically bars the initiation of suits, applications, and appeals within the stipulated time frame.

Reading Material on the Limitation Act, 1963

• Prescribed period of limitation refers to the time limit set for any suit, appeal, or application as per the Schedule.
• The Limitation Act does not result in the extinction of a right but rather bars the legal remedy.
• For instance, in the case of Bombay Dyeing & Mfg. Co. Ltd. v. State of Bombay, it was established that a debt, once time-barred, remains legally valid but unenforceable in court.

Rights and Remedies Under the Act

• At common law, contractual rights are generally unaffected by the passage of time unless explicitly limited.
• While rights remain intact, legal remedies for their violation are restricted after a certain duration.
• Parties cannot alter the statutory period of limitation, but a defendant may consent to a time-barred claim.

Defenses and Court Procedures

• The Limitation Act does not eliminate a defense but prohibits legal action beyond the specified time limit.
• In cases involving specific performance of contracts, a defendant may raise the defense of part-performance to safeguard their possession.

Court Proceedings and Time Limit

• Section 4 of the Act addresses situations where the prescribed period expires when the court is closed.
• If the period ends on a non-working day, the suit, appeal, or application can be initiated on the next working day when the court reopens.

Conclusion

• The Limitation Act serves to regulate the time frame within which legal actions can be pursued.
• It does not invalidate rights but rather restricts the legal recourse available after a specified period.

Judicial Academy Jharkhand

• Section 4: Court Closure and Limitation
• Section 4 doesn't alter the period of limitation but allows for filing when the court reopens after the limitation period expires.

Extension of Prescribed Period (Section 5)

• Allows admission of appeals or applications after the prescribed period if sufficient cause is shown.
• Includes cases where parties were misled in calculating the prescribed period.
• Applies to Criminal Appeals as well.

Delay in Filing Criminal Appeals

• Excusable delays include filing in the wrong court.
• Section 5 can condone delays in filing appeals against acquittals with established sufficient cause.

Limitation Act 1963

• Sections 4 and 5 pertain to extensions of periods for appeals and applications, not suits.
• Courts cannot extend the limitation period for suits, even in uncontrollable circumstances.

Setting Aside Ex-Parte Decree

• Delay condonation required for allowing applications like setting aside ex-parte decrees.
• Illustration: No condonation application resulted in a two-year delay in filing a petition.

State of West Bengal v. W.B. Judicial Service Association, 1990

• Ruling on Government's Distinct Treatment
• Government's proceedings are crucial for public interest, justifying a liberal approach in extending limitations.
• Referenced cases support a favorable stance towards the Government's appeals for the greater good.

Government Decisions vs. Private Decisions:

• Government decisions are collective and institutional, differing from those of private individuals.

Procedural Delays in Government Decisions:

• Government decisions are typically slow due to bureaucratic processes and impersonal nature.
• Bureaucratic organs engage in extensive deliberation and consultation, leading to delays.

Nature of Governmental Functioning:

• Procedural delays are inherent in government decision-making processes.
• Governmental decision-making involves a meticulous process that may lead to delays.

Comparison between Government and Private Decision-Making:

• Governmental decision-making involves more deliberation and consultation compared to private entities.

Condonation of Delay in Filing Appeals:

• Delays in filing appeals can be excused after hearing both parties involved.
• Courts may consider setting aside abetment under specific circumstances.

Application Process for Condonation of Delay:

• The application for condonation of delay is based on affidavits rather than witness testimonies.
• Courts should provide reasons for their decisions regarding condonation of delay applications.

Power of Civil Courts in Passing Interim Orders:

• Competent civil courts have the authority to issue interim injunction orders pending further hearings.

Judicial Academy Jharkhand (1964 SC 1336)

• Section 5 of the Limitation Act allows courts to consider applications filed after the time limit if valid reasons exist for the delay.
• The court has the authority to assess if there was a legitimate excuse for not submitting the application within the stipulated timeframe.

National Insurance Company v. Smt Runiya Binha, 2008 (3) JCR 456 (Jhr) - 041 R3A

• Filing a condonation application with the appeal memorandum is compulsory.
• Courts should only grant delays in exceptional circumstances.

Special Tehsildar, Land Acquisition Kerala v. K.V. Aiyusuma, 1996 (10) SCC 634

• The court should adopt a practical, not overly strict, approach in granting condonation of delay to prevent manipulation and ensure justice.

Pundik Jalam Patil v. Executive Engineer Jalgaon Medium Project, 2009 (1) JLJR 76 SC

• The Supreme Court rejected an application due to false statements, emphasizing that false claims should not be rewarded with condonation of delay.
• Section 5 of the Limitation Act empowers courts to extend time limits if sufficient cause is shown.

Proof of Sufficient Cause

• Proving sufficient cause is crucial for courts to consider granting an extension of time under Section 5.
• Diligence and honesty of the party are factors that influence the court's decision in condoning delays.

Exclusion of Order 21 CPC

• Order 21 CPC, concerning execution, is explicitly not covered by Section 5 of the Limitation Act.

Legal Disability (Section 6)

• A person under legal disability like being a minor, insane, or an idiot can initiate a suit or application after the disability ends.
• If multiple disabilities exist or a new one arises before the first ends, the individual can act within a specific period after all disabilities cease.
• If the disability persists until the person's death, the legal representative can proceed within a set time after the death.
• If the legal representative is also under a disability at the time of the person's death, specific rules apply.
• If a person dies after their disability ends but within the allowed time, the legal representative can act within a specified period after the death.
• Explanation: The term 'minor' includes an unborn child. This section does not apply to appeals by minors but only to suits or decree execution applications.
• Section 6 doesn't cover setting aside a sale under O 21 R 90 CPC or readmission of an appeal under O 41 R 10 of CPC.
• Sections 6, 7, and 8 complement each other and are not mutually exclusive.

Disability of One of Several Persons (Section 7)

• If one person among several joint holders of a suit or decree execution application is under disability, time runs against all unless a discharge is possible without their consent.
• If no discharge is possible without consent, time doesn't run against any until one can provide discharge without needing others' consent or until the disability ends.
• Explanation I: This section pertains to discharges from various liabilities, including those related to immovable property.
• Explanation II: The section encompasses the manager of a Hindu undivided family.

Discharge of Liability in Joint Family

• In a Hindu undivided family under Mitakshara law, a member can give a discharge without the consent of others if managing the joint family property.

Narayan v. Babasaheb Case (2016)

• A case where a Hindu man passed away, leaving behind sons, daughters, and a widow, involving a dispute over ancestral property.
• Legal Issue: Determining the applicability of the Limitation Act regarding setting aside a sale deed.
• Court Decision: Article 60 of the Limitation Act applied over Article 109, setting a 3-year limit from attaining majority to challenge the sale.

Limitation in Joint Plaintiffs Cases

• When multiple plaintiffs are involved, limitation starts running when one capable of giving discharge emerges.
• The manager of a Hindu undivided family can give discharge without others' consent if managing joint family property.

Section 8 of the Hindu Succession Act

• Exceptions to Sections 6 and 7: Special provisions for enforcing pre-emption rights with a limitation of three years.

Limitation Act, 1963

• Introduction to Limitation
  • Defines the scope and applicability of limitation for legal suits and applications.
• Effect of Sections 6 and 8
  • Section 6 and 8, along with the appropriate Article of the Act, allow a person under disability to sue within a specified period.
  • Special limitation under Section 8 restricts the extended period after the cessation of disability to three years.
• Case Law: Kolandavel Goukderv v. Chinnapan, AIR 1965 Mad 541
  • Facts: Involves a dispute over joint family property sold by a father on behalf of his minor sons.
  • Legal Argument: Discussion on the starting point of the limitation period based on disability.
  • Ruling: Clarifies the application of Sections 6, 7, and 8 in determining the limitation period.
• Section 8 and Disability
  • Section 8 limits the concession provided in Sections 6 and 7 to a maximum of three years after the cessation of disability.
  • Explains that Section 8 acts as a proviso to Sections 6 and 7, imposing restrictions on the time limit.
• Section 9: Continuous Running of Time
  • States that once the time period begins, subsequent disability does not stop it.
  • Exception: Suspension of limitation period in cases of grant of administration to the debtor.
• Cause of Action and Limitation
  • Explains that limitation cannot run until a cause of action arises.
  • Discusses when a cause of action typically accrues and the impact of subsequent disabilities.
• Section 10: Suits against Trustees
  • Provides exceptions for suits against trustees or their representatives regarding property held in trust.
  • States that such suits are not barred by any length of time as per the provisions of the Act.
  • Explanation: Any property belonging to a Hindu, Muslim, or Buddhist religious or charitable endowment is considered as property held in trust for a specific purpose. The individual managing the property is considered the trustee.
• Section 11 - Suits on Contracts Entered into Outside the Territories
  • Suits initiated within the territories covered by this Act based on contracts made in the State of Jammu and Kashmir or in a foreign nation shall follow the limitation rules outlined in this Act.
  • No limitation rule in effect in the State of Jammu and Kashmir or in a foreign country can be used as a defense in a suit filed in these territories concerning a contract made in that state or a foreign country, unless:
    • The rule has terminated the contract.
    • The involved parties were residents of that state or the foreign country during the duration specified by the rule.

Exclusion of Time in Legal Proceedings

• General Rule: When calculating the time limit for a legal action, the starting day is excluded.
• Appeals and Applications: Time taken for obtaining necessary documents like judgments, decrees, or orders is excluded.
• Decrees and Orders: Time needed to acquire copies of judgments related to decrees or orders is also excluded.
• Setting Aside an Award: Time required to obtain a copy of the award is excluded.
• Explanation: Time spent by the court in preparing a decree or order before a copy request is made is not excluded.
• Examples:
  • Specific Performance Suit: Date of performance mentioned in an agreement is excluded when calculating the limitation period.
  • Recovery of Loan: A suit for loan recovery must be filed within three years of the loan grant date.
• Additional Points:
  • Certified Copy: Time taken to obtain a certified copy of a judgment or decree is excluded.
  • Delay Exclusions: Delays due to party negligence in applying for copies cannot be excluded from the computation.
  • Judgment and Decree Interval: Time between judgment delivery and decree signing is considered in calculating copy acquisition time.

Reading Material on the Limitation Act, 1963

• The misjoinder of parties or causes of action is considered similar to a defect of jurisdiction.
• The section aims to protect a litigant from limitation barriers when a proceeding, due to a technical flaw, cannot be decided on its merits and is consequently dismissed.
• If a party failed to obtain relief in prior proceedings not due to jurisdictional defects, they cannot benefit from Section 14.
• When a plaintiff has multiple remedies and has already been unsuccessful in one, they cannot invoke Section 14 when pursuing an alternative remedy.

Conditions for Application of Section 14

• Both prior and subsequent proceedings must be civil and pursued by the same party.
• The prior proceedings should have been conducted diligently.
• Failure in prior proceedings must be due to jurisdictional issues or similar causes.
• The nature of both prior and later proceedings should be alike.

Comparison: Section 5 vs. Section 14 of the Limitation Act

• Under Section 5, the discretion to exclude time is optional, whereas, under Section 14, it is mandatory.
• If the initial filing was careless, subsequent prosecution cannot be considered in good faith.
• Section 14 benefits can only be availed when there is an initial lack of jurisdiction.

Application Scope

Applies exclusively to proceedings before a court.

J. Kumardasan Nair v. IRIC Sohan AIR 2009 SC 1333

• Case Background: The case involved multiple respondents, execution petitions, objections on grounds of Limitation, appellate court rulings, and applications under the Limitation Act.
• Court Decisions: Various courts deliberated on the maintainability of appeals, the interpretation of Section 14 of the Limitation Act, and the exclusion of time under specific circumstances.

Key Takeaways

• Section 14 of the Limitation Act: Focuses on excluding time from proceedings conducted in good faith but without jurisdiction. Conditions for its application include civil proceedings by the same party, diligence in prior proceedings, and failure due to jurisdictional defects or similar causes.

Consolidated Engg. Enterprises v. Irrigation Department (2008)7 SCC 169

• Interpretation of Section 14: The case examined the prerequisites for invoking Section 14 of the Limitation Act, emphasizing the need for both prior and subsequent civil proceedings by the same party, conducted diligently and in good faith, and influenced by jurisdictional errors or similar hindrances.

Limitation Act, 1963

• The earlier and latter legal proceedings need to pertain to the same subject.
• Both proceedings must occur in a court setting.

Explanation

• The purpose of this section is to protect a litigant from time constraints when initiating a proceeding that is dismissed due to technical errors, preventing a decision on the merits. Section 14 of the Limitation Act aims to promote justice by allowing relief in cases of mistaken remedies or forum selection.

Interpretation

• Section 14 intends to exclude a specific period involving genuine legal activities. It ensures that individuals who genuinely attempt to have their cases heard but face obstacles are not unfairly barred by time limitations.

Application

• The equity of Section 14 should be fully applied, excluding time spent diligently pursuing a remedy in a wrong court. However, the provision does not cover deliberate mistakes made to delay proceedings.

Good Faith and Diligence

• Diligence and good faith in court proceedings are crucial. Good faith, as defined in Section 2(4) of the Limitation Act, requires actions to be taken with care and caution.

Exclusions

• Section 14 benefits are not applicable in criminal proceedings.
• A second lawsuit starts a new limitation period and is not a continuation of the first suit.

Legal Precedent

In the case of Commissioner, M.P. Housing Board v. M/S Mohan Lal and Company, it was established that different stages of legal proceedings, such as filing for arbitration and objecting to an award, do not constitute the "same matter in issue," thus Section 14 does not apply.

Limitation Act, 1963

• General Overview: The Limitation Act, 1963 necessitates a plaintiff to familiarize themselves with the estate or company's affairs, assets, and liabilities before taking legal action. It also allows a three-month period post-appointment to file a suit or petition.
• Conditions for S. 15 (4) Benefit: To benefit from Section 15(4), two conditions must be met: the suit must seek possession by the purchaser from a sale in execution of a decree, and it should be a suit rather than an application. If these criteria are satisfied, the time spent on proceedings to set aside the sale deed is excluded.
• Case Example - Turner Morrison & Co. Ltd. v. Hungerford Investment Trust Ltd.: The case highlights interpretations of Section 15(5) regarding limitation periods for incorporated companies. The court ruled that the provision does not apply to incorporated companies or that they are considered to reside where they conduct business activities.

Section 16 - Effect of Death on Right to Sue

• Death Before Right Accrues: If a person dies before the right to sue matures, the period of limitation starts when there is a legal representative capable of initiating the legal action.
• Death of Defendant: In cases where a defendant dies before the right to sue emerges, the limitation period begins when there is a legal representative against whom the plaintiff can take legal action.
• Exceptions: Subsection (1) and (2) do not apply to suits enforcing preemption rights, possession of immovable property, or a hereditary office.

Before the Right Accrues

• The principle states that the death must occur before the right to sue or make an application accrues. If the right emerges during the lifetime of the deceased, the limitation period starts from the date of accrual. It does not matter whether a legal representative comes into existence through a will or by other means.
• Section 16 aims to restrict the time within which an action can be brought, without diminishing the rights of a potential defendant. The term 'capable of suing' means 'not being under a legal disability to sue,' unrelated to incapacity due to lack of means or physical absence.
• This section applies to rights of action arising after death, whether simultaneous to or following the death of the person suing or sued. For Section 16 to apply, the death must precede the right to file a suit or make an application. If the right arises during the deceased's lifetime, the limitation period begins at the time of the cause of action, excluding the provisions of Section 16.

Section 17 - Effect of Fraud or Mistake

In cases where a suit or application falls under a specified limitation period and:

• Fraud of Defendant or Concealment of Knowledge: If the suit or application is based on the defendant's fraud, concealment of the right or title, or seeks relief from a mistake, the limitation period starts when the plaintiff discovers the fraud or mistake or could have reasonably discovered it. In the case of a concealed document, the limitation starts when the plaintiff gains access to it.
• Provisions and Exceptions: However, this section does not allow suits or applications to recover charges or set aside transactions concerning property obtained for value by an innocent party unrelated to the fraud.

Reading Material on the Limitation Act, 1963

• In situations involving a mistake, if a valuable purchase is made following a transaction where the mistake occurred by a person unaware of the mistake, or in the case of a concealed document, if a valuable purchase is made by a person not involved in the concealment and unaware of it at the time of purchase.
• If a judgment-debtor uses fraud or force to prevent the execution of a decree within the limitation period, the court can extend the execution period upon the judgment-creditor's application made after the limitation period expires, but within one year of discovering the fraud or cessation of force.

Legal Principles

• The section discussed does not apply to criminal cases and upholds the principles of justice and equity, ensuring that parties are not penalized for not taking legal action when crucial information is intentionally concealed from them.
• When a plaintiff claims fraud by the defendant, they must provide clear proof of the fraud rather than relying on mere suspicions. The burden of proof lies with the plaintiff.

Recent Cases and Court Interpretations

• In a 2018 case, the Supreme Court examined the application of Section 17 of the Limitation Act, 1963 in condoning delays caused by alleged fraud in challenging awards beyond specified time limits under the Arbitration and Conciliation Act of 1996.
• The court clarified that Section 17 addresses specific fraudulent acts or concealment of documents that suppress knowledge necessary for legal action. Once a party becomes aware of essential facts for legal proceedings, the limitation period begins.

Effect of Acknowledgement in Writing

• If an acknowledgment of liability regarding a property or right is made in writing and signed by the party against whom the claim is made or by a relevant person, a new limitation period starts from the signing date of the acknowledgment.