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HIGH COURT OF ORISSA
S. K. Ray, J.
SUSILA DEI - Appellant
Versus
SRIDHAR RAUTRAY - Respondent
Second Appeal 88 Of 1965
Decided On : SEPTEMBER 18, 1969
LIMITATION ACT, 1908 - ARTICLE 97 - SALE DEED - VOID AB INITIO - CONSIDERATION FAILED AT ONCE - SUIT FOR REFUND OF CONSIDERATION MONEY - BARRED BY LIMITATION.
Fact of the Case:
Plaintiffs filed a suit for declaration of title and possession of land purchased from Durga Charan Das, father-in-law of defendant 2 and grandfather of defendants 3 and 4. Defendants claimed that Durga Charan had previously sold the same land to defendant 1, and that plaintiffs' sale deed was void ab initio. The trial court and lower appellate court held that plaintiffs had acquired no title and dismissed the suit. The lower appellate court, however, decreed the suit for refund of consideration money from defendants 2 to 4, holding that they had benefited from the consideration money received by Durga Charan.
Finding of the Court:
The High Court held that the suit for refund of consideration money was barred by limitation. It held that Article 97 of the Limitation Act, 1908, which applies to suits for recovery of money paid upon an existing consideration which afterwards fails, did not apply because the consideration failed at once, as the plaintiffs never obtained possession of the property and Durga Charan had no title to pass. The court also held that Articles 115 and 116 of the Limitation Act did not apply, and that the residual Article 120 would apply, which also barred the suit.
Issues: 1. Whether the suit for refund of consideration money was barred by limitation? 2. Whether defendants 2 to 4 were personally liable for the refund of consideration money.
Ratio Decidendi: 1. Article 97 of the Limitation Act, 1908 applies to suits for recovery of money paid upon an existing consideration which afterwards fails. However, in the present case, the consideration failed at once, as the plaintiffs never obtained possession of the property and Durga Charan had no title to pass. Therefore, Article 97 did not apply. 2. Articles 115 and 116 of the Limitation Act did not apply, as the suit was not for breach of contract or for money had and received. 3. The residual Article 120 would apply, which provides a limitation period of six years for suits not otherwise provided for. The suit was filed beyond six years from the date when plaintiffs paid the price to Durga Charan, and was therefore barred by limitation.
Final Decision: The appeal was allowed, and the suit was dismissed as barred by limitation.
S. K. RAY, J.
( 1 ) DEFENDANTS 2 to 4 are the appellants. This appeal is directed against the reversing judgment of Sri S. N. Misra, 3rd Additional Subordinate Judge, Cuttack, dated 13-11-64, passed in Title Appeal No. 180/83 of 1963-64.
( 2 ) PLAINTIFFS filed the suit for declaration of title in respect of the suit land purchased by them under a registered kabala dated 28-10-53 from late Durga charan Das, father-in-law of defendant 2 and grandfather of defendants 3 and 4, and for recovery of possession, or in the alternative, for refund of consideration money of Rs. 200/ -.
( 3 ) THE defendants raised various defences. They contend that the plaintiffs' vendor had, previous to the plaintiffs' sale-deed, sold the same to defen-dant-1. The sale-deed in favour of defendant-1 was executed on 14-10-53 and registered on 3-1153. As title upon registration, is deemed to pass with effect from the date of execution of the sale-deed, defendant-1 must be held to have acquired title to the suit-property with effect from 14-10-53. If that is so, Durga Charan had no more interest in the suit-property for conveyance under the plaintiffs' sale-deed dated 28-10-53.
( 4 ) THIS contention of the defendants found favour with both the Courts below who held that the plaintiffs had acquired no title to the suit-property and also had never obtained possession. Another defence was that the suit for recovery of consideration money is barred by limitation.
( 5 ) WITH regard to the alternative prayer for recovery of consideration money of Rs. 200/- from defendants 2 to 4, as the successors-in-interest of Durga Charan, the two Courts below differed. The trial Court held that the claim for refund of consideration money is barred by limitation. According to him the cause of action for recovery of this amount arose on 28-10-53 when the in-fructuous sale-deed in favour of plaintiffs was executed and registered, and the present suit having been filed on 26th November, 1960, that is to say seven years after the date of execution of the sale-deed, is barred by limitation.
( 6 ) THE lower appellate Court held to the contrary that the suit was not barred by limitation. He, therefore, has decreed the suit for refund of the consideration money of Rs. 200/- from defendants 2 to 4 upon a finding that defendants 2 to 4 have benefited by the consideration money received by late Durga Charan Das whose heirs they are. Therefore, he made defendants 2 to 4 personally liable for the money.
( 7 ) TWO points have been urged by learned counsel for the appellants. First is that either Article 62 or Article 116 of the Limitation Act, 1908 would govern this suit and not Article 97 which has been applied by the lower appellate Court. The suit is accordingly, barred by limitation. The second point is that even if the suit is not barred by limitation, the lower appellate Court was in error in imposing a personal liability on defendants 2 to 4 in regard to refund of consideration money. It is argued that they should have been made liable to pay out of the assets, if any, which they inherited from the late Durga Charan Das.
( 8 ) WITH regard to the first point, it must be noticed at the outset that the law applicable is the Limitation Act, 1908, and not the Limitation Act of 1963 (Act xxxvi of 1963 ). A few facts found have to be kept in the background of the mind before launching into discussion as to the proper Article of the Limitation Act which would govern this suit.
( 9 ) IT is no longer in dispute that the plaintiff's sale-deed was a mere paper-transaction conveying no title. The lower appellate Court also found that the plaintiff paid Rs. 200/- to Durga Charan towards the consideration of his sale-deed dated 28-10-53 and that the plaintiffs never obtained possession of the properties in pursuance of their sale-deed, Durga Charan never mis-spent the money for immoral purposes and defendants 2 and 4 were benefited by the same. The lower appellate Court has applied Article
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