UNIT – V

Limitation Act 1963

Introduction

The law of limitation finds its root in two maxims

 “Interest Reipublicae Ut Sit Finis Litium” - In the interest of the state as a

whole there should be a limit to litigation and
 “vigilantibus non dormientibus Jura subveniunt” - The law will assist only
those who are vigilant with their rights and not those who sleep upon it.

The law of limitation specifies the statutory time frame within which a person may
initiate a legal proceeding or a legal action can be brought. If a suit is filed after the
expiry of the time prescribed it will be barred by the Limitation. It means that a
suit brought before the Court after the expiry of the time within which a legal
proceeding should’ve been initiated will be restricted.

History of the Act

The law of limitation developed in stages and finally took the shape of the Limitation
Act of 1963. Prior to 1859, there was no law of limitation applicable to the whole of
India.

 It was only in 1859 that a law relating to limitation was enacted that was
applicable to all the Courts.
 The Limitation Act was subsequently repealed in the years 1871, 1877, 1908.
 The Limitation Act, 1908 was repealed by the Third Law Commission and the
Limitation Act of 1963 came into force.

Object of the Act

  The Law of limitation prescribes a time period within which a right can be
enforced in a Court of Law.
 The Limitation Act, 1963 contains provisions relating to the computation of
time for the period of limitation, condonation of delay, etc. The time period for
various suits has been provided in the schedule of the Act.
 The main purpose of this Act is to prevent litigation from being dragged for a
long time and quick disposal of cases which leads to effective litigation.
 The Limitation Act contains

The Limitation Act contains

 32 Sections and 137 Articles.
 Articles- 137 in total, divided into 3 Main parts-
1. Description of Suits (Article 1-113)
2. Appeals (Articles 114-117)
3. Applications (Articles 118-137)
 The articles have been divided into 10 parts in detail.
o The first part is relating to accounts,
o The second part is relating to contracts,
o The third part is relating to declaration,
o The fourth part is relating to decrees and instrument,
o The fifth part is relating to immovable property,
o The sixth part is relating to movable property,
o The seventh part is relating to torts,
o The eighth part is relating to trusts and trust property,
o The ninth part is relating to miscellaneous matters and
o The last part is relating to suits for which there is no prescribed period.

There is no uniform pattern of limitation for the suits under which the classifications has been
attempted. The limitation period is reduced from a period of 60 years to 30 years
 PART – II LIMITATION OF SUITS, APPEALS AND APPLICATIONS –
Sections 3 to 11

Section - 3. Bar of limitation.

Section 3 lays down the general rule that if any suit, appeal or application is brought
before the Court after the expiry of the prescribed time then the court shall dismiss
such suit, appeal or application as time-barred. The law of limitation only bars the
judicial remedy and does not extinguish the right. In other words, It means that the
statute of limitation prescribes only the period within which legal proceedings have to
be initiated. It does not restrict any period for setting up a defence to such actions.
Hence, the original right to suit is not barred. However, Section 27 (Extinguishment of
right to property) is an exception to this rule.

Plea of limitation: Duty of Court

The Court is under an obligation to dismiss a suit if it is filed beyond the time
prescribed by the Limitation Act. The provisions of Section 3 are mandatory and the
Court will not proceed with the suit if it is barred by time. Under Section 3 of the Act,
it is clearly mentioned that every suit instituted, appeal preferred and the application
made after the prescribed period shall be dismissed. Even though limitation has not
been set up as a defence.

It was held in Craft Centre v. Koncherry Coir Factories, it is the duty of the plaintiff
to convince the Court that his suit is within time. If it is out of time and the plaintiff
relies on any acknowledgments in order to save the limitations then he has to plead
them or prove, if denied. The Court further held that, provision of Section 3 is
absolute and mandatory and if a suit is barred by the time the court is under a duty to
dismiss the suit even at the appellate stage though the issue of limitation may not have
been raised.
Section 4 - Expiry of prescribed period when court is closed.
 When a court is closed on a certain day and the period of limitation expires on
that day, then any suit, appeal or application shall be taken up to the Court on
the day on which it reopens. This means that a party is prevented not by his
own fault but because of the Court being closed on that day.
 The explanation to this section mentions that within the meaning of this Section
a Court shall be deemed to be closed on any day if during any part of the
normal working of the Court it remains closed on that day.
 For instance, if a Court reopens on 1st January and the time for filing the
appeal expires on 30th December (the day on which the Court remains closed)
then the appeal can be preferred on the 1st of January when the Court reopens.

Section 5 -Extension of prescribed period in certain cases :- Doctrine of

Sufficient Cause for Condonation of Delay
 Section 5 of the Limitation Act, 1963 allows the extension of prescribed
period in certain cases on sufficient cause being shown for the delay.
This is known as doctrine of “sufficient cause”.
 Section 5 provides that any appeal or application (not plaint or suit) may
be admitted after the prescribed period if the appellant or the applicant
satisfies the Court that he had sufficient cause for not preferring the
appeal or making the application within such period.
 Section 5 applies only to appeals or applications. The reason for non-
applicability of the Section to suits is that, the period of limitation
allowed in most of the suits extends from 3 to 12 years whereas in
appeals and application it does not exceed 6 months.

Examples of sufficient cause: What is sufficient cause and what is not may be
explained by the following judicial observations:

 Wrong practice of High Court which misled the appellant or his

counsel in not filing the appeal
  In certain cases, mistake of counsel may be taken into
consideration in condensation of delay, but such mistake must
be bona fide.

 Wrong advice given by advocate can give rise to sufficient cause

in certain cases.

 Mistake of law in establishing or exercising the right given by law

may be considered as sufficient cause. However, ignorance of law
is not excuse, not the negligence of the party or the legal adviser
constitutes a sufficient cause.

 Imprisonment of the party or serious illness of the party may be

considered for condonation of delay.

 Time taken for obtaining certified copies of the decree of the

judgment necessary to accompany the appeal or application was
considered for condoning the delay.

 Non-availability of the file of the case to the State Counselor

Panel Lawyer is no ground for condonation of inordinate delay.

 Ailment of father during which period the defendant was looking

after him has been held to be a sufficient and genuine cause.

However, If a party does not show any cogent ground for delay then the application,
suit or appeal will be rejected by the court.

Section 6 - Legal disability : If a person entitled to institute a suit or make an

application is a minor, insane or idiot at the time of cause of action, the period
of limitation to file a suit or to make an application will start when such
disability ceases.
  Where one legal disability is followed by another legal disability, the
disabilities are successive and the limitation period will run when all the
legal disabilities are ceased.
 If a legal disability continues up to a death, then period of limitation will
run for legal representative (who is not legally disabled) from the date of
death.
 Where a person under disability dies after the disability ceases but within

the period allowed to him under this section, his legal representative may
institute the suit or make the application within the same period after the
death, as would otherwise have been available to that person had he not
died.

Section 9 :- Continuous Running of Time – No subsequent disability or inability to

institute a suit or make an application can stop it

PART – III COMPUTATION OF PERIOD OF LIMITATION

The Limitation Act, 1963 makes specific provisions for exclusion of certain
time in some cases for computation of the prescribed period. These provisions
are follows:

0. In case of any suit, appeal or application, the period of limitation

is to be computed exclusive of the day on which the time begins to
run. [Section 12(1)]

a. The day on which the judgment complained or was pronounced

and the time requisite for obtaining a copy of the decree, sentence
or order appealed from or sought to be revised or reviewed shall be
excluded. [Section 12(2)]

b. Time required for obtaining a copy of the judgment on which the

decree or order is founded shall also be excluded. [Section 12(3)]

c. Time required for obtaining a copy of the award shall be

excluded. [Section 12(4)]
 d. Time during which the applicant has been prosecuting in good
faith, his application for “leave to sue or appeal as a pauper is
applied for”, shall be excluded. [Section 13]

e. Civil proceeding relating to the matter in issue had been initiated

in a Court which is unable to entertain it, by lack of jurisdiction or
by any other like cause shall be excluded. [Section 14]

Sections 15, 16 & 17 -Exclusion of time in certain other cases]:

a. If suit or application for the execution of a decree had been stayed by an

injunction or order then such period of injunction shall be excluded.

b. Time required obtaining the sanction/consent of the Government shall be

excluded.

c. The time during which the defendant has been absent from India and
from the territories outside India but administered by the Central
Government, shall be excluded.

d. Where the suit or application is a based upon the fraud or mistake of the
defendant or respondent or his agent or in other cases as mentioned
in Section 17, the period of limitation shall not begin to run until the
plaintiff or applicant has discovered fraud or mistake subject to certain
exceptions.

Section 18 : Effect of Acknowledgement

As per Section 18 of the Limitation Act, 1963, following are the requirements
for a valid acknowledgement:

1.

i. There must be admission or acknowledgement.

 ii. Such acknowledgement must be of an existing liability in respect
of a property or right.

iii. It must be made in writing and signed by the party against whom
such property or right is claimed, and

iv. It must be made before the expiry of period of limitation.

If all the above conditions are satisfied, a fresh period of limitation shall be
computed from the time when the acknowledgement was signed.

“Under Section 19 : where payment on account of a debt or of interest on

legacy- a fresh period of limitation will be computed when payment was made.

Section 20 : Section 20 is only a further explanation of section 18 and section

19. It says that under a disability the expression ‘agent duly authorised’ will
include the lawful guardian, committee, manager or agent duly authorised by
such guardian, committee or manager.

Section 21 : Where a new plaintiff or defendant is added or substituted after the

institution of suit- the suit will be deemed to be instituted when he was so made
the party. However, if the new plaintiff or defendant was added due to a
mistake in good faith and the Court is satisfied, the suit shall be deemed to
have been instituted on an earlier date.

Under Section 22 : Where there is a continuing breach of contract or tort – a

fresh period of limitation will start at the moment when the breach or tort
continues.

Under Section 23 : In case of suits for compensation for acts not actionable
without special damage- limitation period will start from the time when the
injury occurs.

PART IV - ACQUISITION OF OWNERSHIP BY POSSESSION

Section 27 Extinguishment of Right

General Rule that the law of limitation only bars the remedy but does not bar
the right itself. Section 27 is an exception to this rule. It talks about adverse
possession. Adverse possession means someone who is in the possession of
another’s land for an extended period of time can claim a legal title over it. In
other words, the title of the property will vest with the person who resides in or
is in possession of the land or property for a long period. If the rightful owner
sleeps over his right, then the right of the owner will be extinguished and the
possessor of the property will confer a good title over it. Section 27 is not
limited to physical possession but also includes de jure possession. As per the
wordings of this Section, it applies and is limited only to suits for possession of
the property.

Barring Remedy not Right

The Law of limitation is based on equitable principle that equity helps the
diligent and not the indolent. It induces the claimants to be prompt in claiming
the relief. The law of limitation bars the remedy only after the limitation period
has expired, but it does not extinguish a right on which the suit has to be based.
In all personal actions the right subsists although the remedy is no longer
available.

 If, therefore, a creditor, whose debt becomes statute barred, has any
means of realizing and enforcing claim by any method except by a suit,
the Limitation Act does not prevent him from recovering his debt by such
means.
 Thus, if a time barred debt is settled outside the Court, it is not illegal. If
the debtor without being aware of bar of time pays debt, he cannot sue
the creditor to refund the money paid to him on the ground of recovery
being time barred.
Example: Ram owes Shyam a sum of ` 2,00,000. The debt is barred because of
the law of limitation. The Court shall dismiss the suit if filed by Shyam for the
recovery of the debt after the period of limitation (i.e. after 3 years). However,
if Ram pays Shyam the amount even after the same has become time barred, the
payment would be a valid one.

Law of Limitation bars the remedy, but does not extinguish the right
The Limitation Act, 1963 makes specific provisions for exclusion of certain
time in some cases for computation of the prescribed period of limitation.
These provisions are as under:

i. Exclusion of time in legal proceedings (section 12).

ii. Exclusion of time during which leave to sue or appeal as a pauper is
applied for (section 13).
iii. Exclusion of time bona fide taken in a court without jurisdiction (section
14).
iv. Exclusion of time in certain other cases (sections 15, 16 & 17).
v. Provisions relating to persons under legal disability under the Limitation
Act, 1963

The Supreme Court in Punjab National Bank and Ors v. Surendra Prasad
Sinha held that the rules of limitation are not meant to destroy the rights of the
parties. Section 3 only bars the remedy but does not destroy the right which the
remedy relates to.

It was held in Bombay Dyeing and Manufacturing v. State of Bombay that the
statute of limitations only bars the remedy but does not extinguish the debt.

Retrospective Operation

In BK Education Services Private Limited v. Parag Gupta and Associates, the

Supreme Court clarified that since the law of limitation is procedural in nature, it will
be applied retrospectively. The Supreme Court in Thirumalai Chemicals Ltd v. Union
of India observed that statutes of limitation are retrospective so far as they apply to all
legal proceedings brought after their operations for enforcing causes of action accrued
earlier. In Excise and Taxation v. M/S Frigoglass India Private Ltd, the Punjab and
Haryana High Court ruled that It is well-settled that the law of limitation is a
procedural law and operates retrospectively unless it has been provided differently in
the amending statute. In other words, unless there is a contrary intention manifested
by express or necessary implication of the legislation itself, procedural law is
generally retrospective law.

UNIT – 5

10 Marks

1. Limitation bars the remedy, but does not extinguish the right'. Explain.
2. Once the time has began to run no subsequent disability or inability stops
it. Discuss. +1
3. State the general rules as to calculation or period of limitation.
4. Discuss the effects of fraud or mistake on the period of limitation.
5. State the essentials of valid acknowledgement. +1
6. Explain legal disability under Limitation Act.

Short notes

1. Right to sue arises to X' during his minority. 'X' dies one day after
attaining majority. He is succeeded by his son 'Y' who is a minor.
Determine the effect on the period of limitation.
2. 'A's wife refused to return to her husband and allow him the exercise of
conjugal rights. What is the period of limitation for'A' ? Decide.
3. 'Kiran seeks condonation of delay for not preferring an appeal within the
period of limitation because of engrossing in his marriage. ls it
condonable
4. Rakesh taken debt from Santhosh under oral terms. Rakesh gives a
written acknowledgment, after the expiry of two year. Then he pleads
sorry for not paying the debt yet. Determine the validity of
acknowledgement.
5. The court is closed on the last date of limitation period. 'A' seeks
extension of limitation period on that ground. Will he succeed? +1
6. ‘Q’ seeks condonation of delay for not preferring an appeal within the
period of limitation because of engrossing in his marriage. Is it
condonable ?
7. The General rules for Calculation of period of limitation for filing suit.