Article 62 of the Limitation Act applies to suits for refund of illegally realized money, where the right to refund arises immediately upon receipt by the defendant.

Shambhu Prasad Singh, J.

1. In this second appeal by defendant No. 1, the only question which arises for decision is whether the entire claim made by plaintiff-Respondent No. 1 was within time or part of it was barred. Respondent No. 1 is a factory, situate within the limits of the Patna Municipal Corporation, the appellant. Its case was that though there was no water hydrant or any scheme for water supply in the area concerned, the appellant served a demand notice on it for payment of water tax. Respondent No. 1 pointed out to the office-bearers and employees of the appellant that it was not liable to pay any water tax, but they did not appreciate the legal position and realised water tax from Respondent No. 1. For the water tax illegally realised from Respondent No. 1 for the period uptill fourth quarter of 1955-56, it instituted Title Suit No. 158 of 1956 in the Court of Munsif 1st at Patna. The suit was decreed by the trial Court and the decree was affirmed by the first appellate Court as well as by this Court where a second appeal was filed. Even during the pendency of the suit, the appellant went on realising water tax illegally from Respondent No. 1 and hence the present suit was instituted for refund of the water tax amounting to Rupees 6054.75 N. P. so realised from 14-7-1956 to 23-3-1960.

2. The defence of the appellant was that the realisation of water tax from Respondent No. 1 was legal. It was realised bona fide in exercise of statutory duty of the appellant and the suit was not maintainable. It also took a plea of limitation and that the suit was bad for want of notice under Sec. 508 of the Patna Municipal Corporation Act. State of Bihar (Respondent No. 2) which was also made a defendant in the suit supported the written statement of the appellant and took a further plea that the suit was bad for want of notice under Section 80 of the Code of Civil Procedure.

3. Both the Courts below have concurrently overruled the defences of the appellant and Respondent No. 2 except on the question of limitation. The trial court held that the suit was governed by Article 62 of the first Schedule to the Indian Limitation Act (Act 9 of 1908). It accordingly decreed the suit in part for the payments made from 26th December, 1958 to 23rd September, 1960, which were within three years of the institution of the suit and dismissed it in respect of payments made on and after 14th July, 1956 and before 26th December, 1958. The lower appellate court held that the Article of the first Schedule to the said Limitation Act, which was applicable to the suit, was Article 120 which prescribed a six years period of limitation. In its opinion therefore, the entire claim of Respondent No. 1 was within time and it has accordingly decreed the suit in full.

4. Mr. B. P. Gupta, learned Counsel for the appellant, has urged that the trial Court was correct in applying Article 62 to the case and the lower appellate Court has erred in applying Article 120. He has, therefore, submitted that the decree of the lower appellate Court be set aside and that of the trial Court restored. Article 120 of the first Schedule to the said Limitation Act was a residuary Article which applied to suits for which no period of limitation was provided elsewhere in the Schedule and prescribed a period of six years as limitation from the date when the right to sue accrued. This Article would apply to the suit only if Article 62 is held to be inapplicable. Article 62 runs as follows:

Description of suit Period of limitation Time from which period begins to run

62. For money payable by the defendant to the plaintiff for money received by the defendant for the plaintiffs use. Three years. When the money is received.

5. It has been settled by the decision in Venkata Subbarao V/s. The State of Andhra Pradesh, AIR 1965 SC 1773, that m order to attract Article 62 , it is not necessary that at the moment of the receipt of money the defendant should have actually i