PROJECT REPORT

on
CIVIL PROCEDURE CODE
LIMITATION BARS THE REMEDY
BUT DOES NOT EXTINGUISH THE
RIGHT

SUBMITTED TO: SUBMITTED BY:

Dr. Karan Jawanda Pravesh

B.A.LLB(Hons.)

8th Semester, Section-

B

Roll No. – 73/17

 ACKNOWLEDGEMENT

This project consumed huge amount of work, research and dedication. Still, implementation
would not have been possible if I did not have a support of many individuals and
organizations. Therefore I would like to extend my sincere gratitude to all of them.

First of all I am thankful to Dr. Karan Jawanda for their logistical support and for
providing necessary guidance concerning projects implementation.

I am also grateful for provision of expertise, and technical support in the implementation.
Without superior knowledge and experience, the Project would like in quality of outcomes,
and thus their support has been essential.

I would like to express our sincere thanks towards Friends who devoted their time and
knowledge in the implementation of this project for me.

Nevertheless, I express my gratitude towards my family for their kind co-operation and
encouragement which helped me in completion of this project.
 TABLE OF CONTENTS

S.NO. PARTICULARS PAGE NO.

1. Introduction 5-6
2. Limitation Bars the Remedy but does not Extinguishes 7-9
the Right
3. Section 3 of the Limitation Act 10-11
4. Bibliography 12
 TABLE OF CASES

S.NO. CASE LAWS PAGE NO.

1. Bombay Dyeing Manufacturing Co. Ltd. v. State of 7
Bombay
2. Jawaharlal Law MotumalMamtani vs. 9
BhagohanchandMotamalMamtani
3. Kartar Singh v. Khankha 8
4. Punjab National Bank v. Surendra Prasad Sinha 7
5. Unify & Co. v. D. Sugar Mills 9
6. Zile Singh v. Munshi 9
 INTRODUCTION

There are two types of laws: Procedural laws and substantive law. Substantive law provides
the rights and liabilities of the person whereas procedural law provides the procedure to be
followed for the enforcement of those rights and liabilities as given under substantive laws.
But it is not true that procedural law does not provide the right to the person. For example in
case of adverse possession for more than 20 yrs. continuously without any interference gives
the right of ownership to the person. Limitation Act, 1963 is also one of the procedural
laws. Limitation Act provides the bar to the suit, appeal & application to be filed by the
person. But on the other hand it doesn’t bar the action. It is based on the 2 legal maxims:

Interest Reipublicaeut sit finis litium means that the interest of the state requires that there
should be an end to litigation.

Vigilantibus non dormantibusjurasubveniunt means that the law assists the person who is
vigilant for his right not for the dormant person who sleeps over his rights.

A BRIEF HISTORY OF LIMITATION ACT

There was no specific, uniform Law of Limitation till 1859. Under Hindu jurisprudence
there was no law of limitation, since main source of earning of people was agriculture, so
concentration was more on land and rights attached thereto so there was law of prescription
prescribing certain period of time for acquisition of title by prescription. Before 1859, law of
limitation was being administered in two ways, firstly in territories within original
jurisdiction of courts established by Royal Charter in the Presidency towns of Calcutta,
Madras and Bombay, the English law of Limitation and in the Mo fusil courts, the law as
laid down by the Regulations was administered.

It is in 1859 first specific enactment on law of Limitation was introduced which was
applicable to all courts. The Act XIV of 1859 was then replaced by Limitation Act of 1871
which provided for limitation on Suits, appeals and certain applications to courts. This Act
also provided for acquisition of easements and extinguishment of rights on land and
hereditary office at the determination of certain period. Act of 1871 was then replaced by
Act of 1877. Limitation Act of 1877 was more comprehensive. It provided for law of
prescription not only in respect of land or hereditary office but also to other moveable
properties. Later Act 1877 was also replaced by Act no IX of 1908, which was more or less
repeating the provisions of Act of 1877.

The Act of 1908 remained in force till the present Act No. 36 of 1963 was passed. For many
years the Government of the Republic of India has been much anxious to overhaul the
provisions of the age-old Limitation Act, IX of 1908, which had been the subject of some
controversial discussion at the Bench and the Bar. On the recommendation of the Law
Commission, the old Act was repealed and the new Limitation Act came into force with
effect from January 1, 1964. The Limitation Act, 1963 received the assent of the President
on the 5th October, 1963 and was published in the Gazette of India on the same date.

The present Act is a unique piece of legislation which contains several provisions of far-
reaching nature. It gives statutory expression to the changes recommended by the Law
Commission. It does not contain merely drafting changes but in many aspects it is a new
enactment.
 LIMITATION BARS THE REMEDY NOT THE RIGHT

The law of limitation only bars the remedy when the period of limitation expires, but it
doesn’t destroy the right that cannot be enforced by the judicial process. Thus, if any claim
is satisfied outside the court after the expiry of limitation period, it is not illegal.

Limitation Act protects the innocent persons from the stale claims being hung on their heads
for a long time, only a vigilant person or a bonafide claimant will come to the court within
the prescribed period for the enforcement of his right.

For instance if “A” was providing some goods to “B” on advance with a span of 1 year and
he continued this for the 4 yrs. And after 4 years of advance transactions, the period of 3
years is fixed for the filing of suit in case of non-payment and it is now barred by the
limitation. Here although the remedy has been barred by the limitation but

 If “B” pays the 1st amount to “A” , the right to receive the remaining amount back is
not destroyed;
 If any payment is made by “B” without mentioning for which period it has been
made. The creditor shall consider the payment for the 1st transaction. Here, the
Creditor shall be justified in doing so; and
 If the creditor is in the possession of a security the debt could be adjusted from the
security in his possession or custody.

In Bombay Dyeing Manufacturing Co. Ltd. v. State of Bombay 1. It was held that the law of
limitation bars the remedy in a court of law only when the period of limitation has expired.
But it doesn’t extinguish the right. In other words the right cannot be enforced by judicial
process. If the claim is satisfied outside the court, it is not to be considered as illegal.

In the case of Punjab National Bank v. Surendra Prasad Sinha 2, the bank has given the
loan to one Mr.NarainDubey. He had submitted a security to bank in form of F.D.R. and
stood as guarantor for Mr.Dubey. The debt became time-barred, bank adjusted the loan from
security. The R sued the bank for criminal misrepresentation. The Court held that the bank
was entitled to appropriate the debt from the security.

1
(1958)
2
AIR 1992 SC 1815.
 It was held that the debt continues to subsist as long as it is not paid. It is not obligatory to
recover the debt by a suit. The rules of limitation are not meant to destroy the rights of the
parties.

EXCEPTIONS:

 Section 27 of the Limitation Act, 1963 is an exception to the rule. It is as under:

Extinguishment of right to property. —At the determination of the period hereby
limited to any person for instituting a suit for possession of any property, his right to
such property shall be extinguished.

According to the Section 27 of the Limitation Act, 1963, at the determination of the period
hereby limited to any person for instituting a suit for possession of any property, his right to
such property shall be extinguished.

The principle underlying the Section 27 of the Limitation Act is that the person having the
right to possession suffers his right to the property barred by law of limitation.

Section 27 only applies to persons who are out of possession and seeks to recover
possession, but not to the case of a person who is still in possession of the property. Where
no period of limitation is provided, then Section 27 does not apply. Section 27 applies only
to suits and not to applications.

Section 27 is an exception to the general principle that the law of limitation only bars the
remedy but does not extinguish the right itself. So far as a suit for possession is concerned,
Section 27 states that at the determination of the period thereby limited to any person
instituting a suit for possession being out of possession, his right to such property shall be
extinguished. Section 27 is not actually related to the law of limitation but to a law of
prescription which has to be distinguished from the law of limitation.

Section 27 is not merely procedural but substantial. The Section 27 only extinguishes the
title of the rightful owner.In the case ofKartar Singh v. Khankha3, it has been held that even
though the Section 27 does not apply in terms to Special or Local Acts, but the principle
underlying Section 27 applies to local laws.

Section 27 of the Limitation Act is limited to suits for possession of the property. So it does
not apply to a suit by a mortgagee for recovery of the money due to him by sale of the
3
(AIR 1935 Lah. 787)
mortgage property. The mortgagor’s remedy may be barred if he omits to sue within the
statutory period, but his right is not extinguished.In Unify & Co. v. D. Sugar Mills4, it has
been held that Section 27 applies to both movable and immovable property for the
possession of which the right has to be exercised within the period of limitation prescribed
for such recovery failing which the right to such property shall be extinguished by virtue of
Section 27 of the Limitation Act.

A person who claims adverse possession has to prove that he has remained in uninterrupted
possession of the property to the knowledge of the true owner and has denied the title of the
true owner and asserted his own rights of ownership in the property to the exclusion of the
true owner. Otherwise mere possession for any number of years cannot constitute adverse
possession. Adverse possession implies that it commenced in wrong and is maintained
against right.

In Zile Singh v. Munshi5, it has been held that when after the order of eviction was passed
the tenant was continuing in possession for more than 12 years and the landlord did not file
any execution for possession within the above period the right to recover possession has
been lost by lapse of time. However, it is a case in which right may be subsisting but remedy
lost6.

 Section 29(1) of the Limitation Act, 1963 provides for other exception. It states as
under:
Savings.—(1) Nothing in this Act shall affect section 25 of the Indian Contract
Act, 1872 (9 of 1872).

It was held in the caseof Jawaharlal Law MotumalMamtani vs.

BhagohanchandMotamalMamtani7 that under Sec. 25(3) of the Contract Act, 1872, an
agreement in writing undertaking to pay a time barred debt is valid and binding. But there
are special cases in which, on the remedy becoming barred by limitation, the right itself is
extinguished like the one contemplated in Sec. 27 of the Limitation Act, 1963.

4
(AIR 1970 Cal. 80)
5
(AIR 1990 P&H 50)
6
http://www.shareyouressays.com(Visited on 24th April,2018)
7
AIR 1981, Delhi 338 at P. 343
 SECTION 3 OF THE LIMITATION ACT,1963

Sec 3. Bar of limitation.—(1) Subject to the provisions contained in sections 4 to 24

(inclusive), every suit instituted, appeal preferred, and application made after the
prescribed period shall be dismissed, although limitation has not been set up as a defence.

(2) For the purposes of this Act,—

(a) a suit is instituted,—

(i) in an ordinary case, when the plaint is presented to the proper officer;

(ii) in the case of a pauper, when his application for leave to sue as a pauper
is made; and

(iii) in the case of a claim against a company which is being wound up by the
court, when the claimant first sends in his claim to the official liquidator;

(b) any claim by way of a set off or a counter claim, shall be treated as a separate
suit and shall be deemed to have been instituted—

(i) in the case of a set off, on the same date as the suit in which the set off is
pleaded;

(ii) in the case of a counter claim, on the date on which the counter claim is
made in court;

(c) an application by notice of motion in a High Court is made when the application
is presented to the proper officer of that court.

Under Section 3 of the Indian Limitation Act, a suit or an appeal or an application filed
beyond the time prescribed is to be dismissed by the court although limitation was not set up
and pleaded by the opposite party.

Sec 3 of the Act provides that any suit, appeal or application if made beyond the prescribed
periodoflimitation, it is the duty of the court not to proceed with such suits irrespective of
the fact whether the pleaof limitation has been setup in defence or not. The provision of sec
3is mandatory. The court can suomotu take note. The effect of sec 3 not to deprive the court
of is jurisdiction. Therefore, decision of a courtallowing asuit which had been instituted after
the period prescribed is not vitiated for want of jurisdiction8

8
http://www.lawyersclubindia.com (Visited on 24th April, 2018).
 BIBLIOGRAPHY

 BOOKS
 Jain Dr. Ashok K. , Law of Limitation
 Takwani, Code of Civil Procedure.

 INTERNET
 http://www.lawyersclubindia.com
 http://www.shareyouressays.com
 STATUTE
 The Indian Contract Act, 1872.
 The Limitation Act,1963