The cause of action for a recovery suit arises when the funds are defalcated, and the suit must be filed within the limitation period. Directions of the Court in a PIL do not create a fresh cause of action.

1.In this Appeal, the Plaintiff has laid siege to the Order dated 12.10.2006 passed by the learned Single Judge dismissing the suit on the finding that it was clearly barred by limitation. The Appellant/Plaintiff has filed a suit for recovery of Rupees 1,08,00,000/- against twenty of its employees, together with three other persons (Defendants No.20-22) as beneficiaries of the defalcation allegedly carried out by Defendant Nos.1-19. In the Plaint, it has been averred that the Vigilance Department had received information in December, 1996 in respect of this defalcation. The Department submitted its Report in July, 1997. It appears that the Central Bureau of Investigation (CBI) had registered a First Information Report against all the Defendants and filed a Chargesheet on 5.11.1997. Reliance has been placed by the Plaintiff on several documents and actions carried out between 19.8.1997 and March, 1998. All this is succinctly stated in the cause of action paragraph of the Plaint, which is in these words ² ´That the cause of action arose for the first time on 14.7.1997 when the Vigilance Department submitted its report for further investigation. It further arose in favour of the Plaintiff and against the Defendants after the submission of the inquiry report by the various Inquiry officers who were appointed by the Plaintiff to conduct the inquiries against the Defendants. It further arose when court has directed the Plaintiff vide its order dated 23.1.2001 to take up appropriate proceedings against the aforesaid defendants. It further arose when the CBI filed its charge-sheet before the Special Court of CBI on 5.11.1997 and it is still continuing as the

2. The Order passed by this Court in a Public Interest Litigation (PIL) reads as follows:-

From the affidavit filed by respondent Nos.2 and 3, it is apparent that as many as 19 officials were charge-sheeted. Out of 19 officials, seven officials have since been removed/dismissed from service on the basis of the findings of the Inquiry Officers. In respect of five officials, major penalties have been imposed. Two officials were exonerated as the charges framed against them could not be sustained for lack of evidence. In respect of remaining two officials, it is stated in the counter affidavit that the inquiry has been completed and appropriate orders of the Disciplinary Authority are awaited. The affidavit also discloses that cases against the officials who were involved in the scam have been registered by CBI under Section 120-B, 419, 420, 468, 471 of IPC and Section 13(2) read with Section 13(1)(d) of Prevention of Corruption Act. It is also stated that CBI has filed charge sheets against 21 persons including the officials of ITPO.

From the Inquiry Reports, we find that the company was defrauded/cheated of huge sum of money by the officials. This fact has been admitted in the counter affidavit.

Having regard to the Inquiry Reports and the counter affidavit, we direct that appropriate proceedings for recovery of the amounts of which the company was defrauded/cheated by the officials should be initiated. We hope and trust that the proceedings shall be initiated expeditiously.

The writ petition is disposed of with the above said direction and observations.

Dasti.

3. The learned Single Judge has correctly arrived at the conclusion that Article 113 of the Limitation Act, 1963 is attracted to the present case. In other words, the cause of action should not have arisen prior to three years of 12.4.2001, the date on which the Plaint was filed.

4. On a reading of the Plaint it becomes manifestly clear that the cause of action arose on 14.7.1997 and the Suit, therefore, ought to have been filed on or before 13.7.2000. We cannot agree with Mr. Jayant Bhushan, learned Senior Counsel for the Appellant, that the cause of action can only arise after the decision of the Special Court of CBI before whom the Chargesheet had been filed. If this argument is extended further, it would