Krishna Gopal Kakani vs Bank Of Baroda

Mr.Krishna Gopal Kakani ........Appellant

Vs.

Bank of Baroda .......Respondent

JUDGMENT

HARJIT SINGH BEDI,J.

1. This appeal arises out of the following facts.

2. The appellant, Krishna Gopal Kakani, the proprietor of

M/s. Oriental Traders, a concern involved in the manufacture

and import of goods, obtained a letter of authority from the

Chief Controller of Imports and Exports, Bombay for the

import of raw material for the benefit of a licensee who had

been given an import licence. The appellant accordingly 2

placed orders with a foreign supplier for the import of

specified goods and for that purpose approached the

respondent-Bank for opening Letters of Credit for two

consignments. The bank thereupon opened two Letters of

Credit, one on 24th August 1973, and the other on 21st

September 1973 on which he also deposited 10% of the

margin money of Rs.4560/- and Rs.4810/-. The other

formalities having been completed, the Letters of Credit were

duly negotiated on 21st January 1974 and 19th March 1974.

The consignment arrived in India on 13th March, 1974 but

despite the requests made by the appellant and his clearing

agent, the Bombay Customs refused to release the goods

without assigning any reason, though on enquiry from the

Joint Chief Controller of Imports and Exports, Bombay, the

appellant was told that the controller had no objection to the

release. Faced with a notice from the Port Trust threatening

heavy demurrage charges and apprehending auction of the

goods by the Trust, the appellant as a joint-holder of the

property approached the Bombay High Court for orders. The

Bank also, as joint-holder of the import licence by virtue of 3

having paid the value of the import consignment, thereafter

filed several Miscellaneous Applications before the Court and

in one matter, Miscellaneous Application No. 950/1975, the

appellant was also arrayed as respondent No.7. In this

application, it was pleaded by the Bank that the action of the

respondents therein in not releasing the consignments was

unjustified and that the appellant-Bank also claimed their

rights on the goods as being joint-holders thereof. The

Bombay High Court in its order dated 19th November 1975

directed as under:-

"(a) That respondent No.6 do sell the goods by Public auction to the highest bidder preference to be given to the actual users holding Drugs Controllers Licenses.

(b) Respondent No.6 do deposit the net sale proceeds or the goods with the Prothonotary and Senior Master, High Court, Bombay to invest the net sales in fixed deposit with Bank of Baroda at Bombay Office.

(c) The sale proceeds shall represent in all respects as they were the "Goods" for all purpose including for the purpose of the Lien on the said goods, if any, of the 6th respondent.

4 (d) The said sale proceeds shall be held by the Prothonotary and Senior Master, High Court, Bombay subject to the rights of the parties and further orders of the High Court."

3. Pursuant to the aforesaid order, the goods were sold

by public auction and the sale proceeds of Rs.4,72,714.16

were deposited with the Prothonotary and Senior Master of the

Bombay High Court. Miscellaneous Application No. 950/1975

was finally disposed of by the Bombay High Court on

3rd October, 1979 with the direction that the Bank would be

entitled to the amount deposited but would defray an amount

of Rs.8044.18 to the Bombay Port Trust towards demurrage

charges and was also liable to pay the customs duty. In the

light of the above said directions, the Bank which had also

filed a civil suit against the appellant in Indore on 31st

December 1976 for the recovery of Rs.1,27,282.93 with

interest, withdrew the same on 3rd October 1980. In the

background of this development, the appellant, by a telegram

dated 19th November 1980, requested the Bank to refund the

surplus amount along with the margin money lying in deposit

with the Prothonotary with interest and ( as per the present 5

suit) the Bank intimated that the money would be paid after

receiving orders from the Bombay Head Office. The appellant

also wrote a letter to the Bank and also sent a reminder dated

11th November 1980 on which the Bank replied (on 2nd

December 1980) that it was still awaiting instructions from the

higher authorities. It appears that the appellant also

addressed several letters to the higher echelons in the Bank

and also met the concerned officials between the years 1980

and 1988 but to no effect and ultimately addressed a letter

dated 12th December 1988 threatening the Bank with legal

action. It appears that in the interregnum, one R.M. Patwa,

who was also a debtor to the Bank approached the appellant

that his debts could be adjusted against the amount of the

surplus dues of the appellant lying deposited with the Bank.

The appellant consented to the said proposal and an

application was accordingly moved on 4th March 1986 in the

execution proceedings pertaining to R.M. Patwa's case. It

appears that at one stage the Bank agreed to the adjustment

but subsequently i.e., on 14th September 1990, withdrew its

consent. The appellant thereafter filed Writ Petition No. 2840 6

of 1991 before the Bombay High Court claiming the same

relief as in the present suit. The said petition was dismissed

on 25th October 1991 on the ground of delay and a Special

Leave Petition filed in this Court was also dismissed with the

observation that the remedy by way of a Writ Petition was not

a proper one in the circumstances. In the meanwhile, in the

execution petition in R.M. Patwa's case, the court directed that

R.M. Patwa's debt be adjusted against the appellant's dues.

This order was maintained in a revision petition before the

High Court in its order dated 10th May 1995 after a statement

of accounts had been filed on 24th February 1995. The Bank

challenged the order aforementioned in a Special Leave

Petition before this Court and the appeal was duly allowed on

12th January 1996 and the order impugned was set aside. It

is, thereafter, that the present suit has been filed on 8th

September, 1997 and on the averments leading to the

question of limitation, it was pleaded that the cause of action

for filing the suit arose on 24th February 1995, when for the

first time the Bank had filed a statement of accounts in the

High Court. The appellant Bank filed its written statement on 7

18th July 1998 pleading, inter-alia, that the submission of the

statement of accounts could not be said to be an admission of

the claim of the appellant/plaintiff or an acknowledgement of

the debt and as such the plea that the cause of action accrued

on the 24th February 1995 was erroneous and the suit having

been filed after 17 years from 19th November 1980 was clearly

and grossly time barred. It was also pointed out on facts that

the appellant's money had never been at stake except to the

extent of the margin money and he was, in any case, not

entitled to the exorbitant amount claimed by him.

4. The trial court framed seven issues on 17th August 1988;

issue No.1 being whether the suit was barred by limitation

and issue No.5 as to whether the appellant was entitled to a

decree for Rs.23,54,707.58. The appellant examined himself

as PW1 and closed his evidence. By a judgment and decree

dated 3rd February 2000, the trial court decreed the suit for

the amount claimed along with simple interest at 11% from

the date of the suit till the date of the payment. It was held,

inter-alia that the appellant being the proprietor of M/s.

Oriental Traders was entitled to the surplus amount which 8

had been deposited with the Prothonotary on account of the

auction of the goods. The court also concluded that the Bank

was a trustee of the appellant's money and, therefore the suit

was covered by Section 10 of the Limitation Act (hereinafter

called the "Act"), which provided for no limitation and in the

alternative the cause of action had arisen on 1st August 1997

when the demand notice had been issued by the appellant or

from the 24th February 1995 when the statement of accounts

had been submitted in the executing court in Patwa's case.

The submission of the Bank that the limitation had expired in

the year 1992 after the passing of the order of the Bombay

High Court was rejected in view of the above findings. The

matter was thereafter taken in first appeal before the Gujarat

High Court which reversed the order of the trial court

observing that the Bank was not a trustee of the money

inasmuch that there was no deposit and the matter pertained

to a commercial transaction relating to the opening of Letters

of Credit and such transaction could not be said to be

relatable to a trust so as to bring the matter within Section 10

of the Act. The court also observed that the appellant was 9

aware of the directions given by the Bombay High Court in

Miscellaneous Petition No.950 of 1975 for the public auction

of the imported raw material and the deposit of the proceeds

with the Prothonotary and that this amount had indeed been

deposited with the said officer and finally released to the Bank

by the order dated 3rd October 1979 and in this view of the

matter it was not for him to plead ignorance of the aforesaid

proceedings. It was further opined that it would have been

appropriate that he should have raised some objection at that

stage or filed another suit but instead, the appellant had

continued to send legal notices and had also made a futile

attempt at an adjustment in the year 1990 in R.M. Patwa's

case. The High Court also observed that the undertaking

given at one stage by the Bank agreeing to the adjustment

which had been subsequently withdrawn had no force as the

orders of the executing court and the High Court had been set

aside by the Supreme Court and as such any undertaking

given in those proceedings was in any event nonest. The High

Court also expressed its surprise at the fact that though the

appellant had deposited a sum of Rs. 4560.00 and Rs.4810.00 10

only as margin money for the Letters of Credit, yet an

astronomical amount without any rational basis had been

decreed by the trial court. The court also observed that a suit

for money payable by the defendant to the plaintiff for money

received for the plaintiff's dues lay within 3 years only from

the date of money received as per Article 24 of the Act, and in

the light of the fact that the Bombay High Court in its final

order passed on 3rd October 1979 in Misc. Application No.

950/1975 had directed that the money should be paid to the

Bank was the date from which the 3 years period would be

deemed to have commenced and that this was also the

appellant's understanding as he had given a demand notice

telegraphically on 19th January 1980, confirming the same in

writing on 13th October 1980 but despite this, the suit had not

been filed within 3 years of that specific date. The Court also

noted that in the year 1990, he had once again tried for an

adjustment of the amount in R.M. Patwa's case and though

the offer for adjustment at one stage had been accepted by the

Bank but it would still amount to an acknowledgment to save

limitation (which would have to be within the original period of 11

limitation). The High Court further opined that the appellant

had been associated with the matter relating to Miscellaneous

Petition No.950/1975 in the Bombay High Court and had also

admitted that he had not spent any amount with respect to

those proceedings and had not made any attempt to claim his

rights from the year 1980 to 1988 and that in any case after

the Supreme Court had dismissed his Special Leave Petition

on 10th February 1992 with the observation that the remedy

by way of a writ petition was not a proper remedy on which

the appellant had made a statement that he would file a civil

suit, the suit had not been filed within 3 years but had been

filed after more than 5 years on 8th September 1997. The High

Court then examined the broad arguments in principle that

ordinarily a Bank should not take a plea of limitation but went

on to hold that in the light of the circumstances of the case

and the complete inaction of the appellant to pursue his

remedies despite several opportunities before him, did not

justify any special consideration. The court finally held in the

circumstances that the suit would be governed by Articles 22

and 24 of the Act and that limitation of three years would start 12

from the date of receipt of the money or 3 years from the date

when the demand had first been made. The plea made on

behalf of the Bank with respect to the suit being barred under

the principles of res-judicata in view of the writ petition filed

by the appellant in the Bombay High Court which had been

dismissed and the Special Leave Petition also dismissed on

the ground of laches was, however, not gone into by the High

Court. The High Court, accordingly, allowed the appeal and

set aside the order of the trial court and dismissed the suit.

5. Mr. Tapan Ray, the learned senior counsel for the

appellant has submitted that the suit was governed by

Section 10 of the Act or in the alternative, Article 113

thereof and the finding of the High Court that it was

governed by the provisions of Articles 22 and 24 ibidem was

erroneous. It has also been submitted that it was not open

to a Public Sector Undertaking such as the respondent-

Bank to take the plea of limitation as the taking of the plea

was to defeat a cause which was not only just but on the

admitted facts of the case the money belonged to the

appellant. The learned counsel for the respondent has, 13

however, pointed out that Section 10 of the Act pertained to

suits against trustees and their representatives and a bare

perusal of the facts of the case would show that there was

no element of the creation of a trust and that this was not

even the case set up by the appellant at the initial stages.

It has also been pointed out that Article 113, even if

applicable, provided for a limitation of 3 years from the time

when the right to sue accrued and as the appellant had

himself admitted in Writ Petition No.2840/1991 and in

several other court proceedings that a demand had been

made on several occasions from the year 1980 onwards for

the payment of the amount but had not been accepted, the

right to sue would have accrued from that date and the suit

having been filed in the year 1997 was clearly out of

limitation. It has, accordingly, been pleaded that as the

suit was one for recovery of money simplicitor, it would be

governed by Article 22 or 24 of the Act, as had been found

by the High Court. It has finally been submitted that

though it was perhaps not proper for a Public Sector

Undertaking to take a plea of limitation, but in the facts of 14

the case inasmuch as the appellant had slept over the

matter for years together, all pleas were open to the

defendant.

6. We take up Mr. Ray's first argument with regard to the

applicability of Section 10 of the Act. Section 10 reads as

under:

"Section 10. Suits against trustees and their representatives.- Notwithstanding anything contained in the foregoing provisions of this Act, no suit against a person in whom property has become vested in trust for any specific purpose, or against his legal representatives or assigns (not being assigns for valuable consideration), for the purpose of following in his or their hands such property, or the proceeds thereof, or for an account of such property or proceeds, shall be barred by any length of time."

7. A bare perusal of this section would reveal that it applies

where a property had been vested in trust for any specific

purpose and for certain other purposes stipulated in the

provision. We are of the opinion that there is nothing to

suggest that a trust had been created merely because some

money had been deposited with the Bank at the instance of 15

the Court on account of the auction of the goods and it was

not a mere deposit simplicitor.

8. Mr. Ray has also referred us to Sections 9,10,14 and 19

of the Indian Trusts Act 1894 with respect to the creation of a

trust and drawn our particular attention to Section 88 thereof

which deals with the question of an advantage gained by a

fiduciary. Section 88 is reproduced below:

"Section 88. Advantage gained by fiduciary.- Where a trustee, executor, partner, agent, director of a company, legal advisor, or other person bound in a fiduciary character to protect the interests of another person, by availing himself of his character, gains for himself any pecuniary advantage, or where any person so bound enters into any dealings under circumstances in which his own interests are, or may be, adverse to those of such other person and thereby gains for himself a pecuniary advantage, he must hold for the benefit of such other person the advantage so gained."

9. An analysis of this Section would show that the Bank, to

whom the money had been entrusted, was not in the capacity

set out in the provision itself. The question of any fiduciary

relationship therefore arising between the two must therefore 16

be ruled out. It bears reiteration that there is no evidence to

show that any trust had been created with respect to the suit

money.

10. The learned counsel has, however, placed reliance on

Canbank Financial Services Ltd. Vs. Custodian & Ors.

(2004) 8 SCC 355 to contend that a Banker holding a

customers money would do so in a fiduciary capacity and as

such the matter would fall within section 88 and ipso facto

make Section 10 of the Act applicable. We, however, see from

a perusal of this judgment that it related to a situation where

funds in the account of one Hiten Dalal were utilized by two

stock-brokers to purchase units in a Mutual Fund under

instructions of Hiten Dalal. The units were handed over to

Hilen Dalal and the interest accruing thereon was handed over

to him. It was in this situation that the Court held that a

fiduciary relationship was created with the appellant financial

service and Dalal. Clearly, this is not the case herein. Section

10 of the Act is, therefore, not relevant to the circumstances. 17

11. We now examine Mr. Ray's primary arguments with

regard to the applicability of Article 113 of the Act. This

Article is reproduced hereunder:

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

"113. Any suit for which Three years When the right to sue accrues.

no period of limitation is provided elsewhere in this Schedule.

12. A reading of this provision reveals that the time of

three years would start running from the date when the right

to sue accrues. It has been submitted by Mr. Ray that the

limitation would start from 24th February 1995 i.e., the date

when the accounts had been submitted by the Bank in Court.

The learned counsel for the respondent has, however, pointed

out that the appellant had made his first demand for the

money due to him by a telegram dated 19th November 1980

and as the said demand had not been honoured, the period of

limitation would start from that day. It has also been argued

that a demand had been made on several occasions thereafter

as well but no suit had been filed till the year 1997. 18

13. We have considered this argument very carefully. It

appears from the documents on record that several notices

etc. had been issued by the appellant to the Bank and in

response to some of them, the Bank had made its reply that it

was awaiting instructions from its Head Office. The learned

counsel for the respondent has pointedly drawn our attention

to a registered notice dated 12th December 1988 wherein after

giving a chronology of what had happened, it was stated in

paragraph 3 as under:

"This is, therefore, finally to call upon you to settle my clients account by making appropriate payment to it within seven days of the receipt of this notice else my client shall be constraint to file suit for account against the bank treating it as refusal on the part of the bank to settle the account at the entire risk or the x x x as to costs and consequences which please note carefully."

14. Concededly, the suit was not filed even within 3 years

from 12th December 1988 despite the above said notice and

the suit was, in fact, filed in the year 1997. The learned

counsel for the appellant has, however, referred us to 19

paragraphs 39 and 40 of the plaint to identify the date for the

start of limitation. These paragraphs are reproduced below:

"Para 33. On 24.2.1995 the defendant Bank submitted statement of account of Plaintiff before the Hon'ble High Court therein showing the credit and debit entries made by them in account of plaintiff with an application and undertaking for giving interest @ 19% on the surplus amount of the plaintiff lying with the defendant Bank and specifically requested to the Hon'ble High Court to decide the account as submitted by the Bank on above mentioned terms for interest on surplus.

Para 39. That the cause of action for the present suit accrued in favour of the plaintiff and against the defendant on 24.2.95 when the plaintiff, as stated in para 32 and 33 here-in-above, for the first time came to know, through the statement of account submitted by the defendant in the High Court, about the amount received by the defendant from sale proceeds of the goods, and illegal deduction made by them from the said amount, therefore, the suit is within limitation.

Para 40. That the transaction took place at Indore, the cause of action accrued at Indore and the disputed amount is lying with the defendant Bank at Indore at its Indore Branch, therefore, this suit is within territorial jurisdiction of this Court."

20 15. We are of the opinion that the appellant's plea of

ignorance is clearly untenable in view of the documents

referred to above and even from a perusal of the proceedings

in the present civil suit. In his cross-examination, the

plaintiff-appellant has admitted that in Misc. Application No.

950/1975 he had been served a notice but had not appeared

in Court, but was fully aware that the goods had been sold

under the orders of the High Court for Rs.4,72,714.16 and

that on 3rd October 1979, when Misc. Application 950/1975

had been finally disposed of, he knew that the aforesaid

amount had been deposited with the Bank. The appellant

also admitted that from 3.10.1979 to 14.3.1991, when the

Writ Petition had been filed in the Bombay High Court, no

steps had been taken to recover the amount though several

notices, threatening action had been issued. Further even

assuming for a moment that a statement of accounts had

been tendered by the Bank on 24.2.1995 in Patwa's

proceedings, that would not amount to an acknowledgement

to save limitation, as limitation had long since expired. 21

16. There is yet another circumstance which clearly

militates against the case set up by the appellant. In

paragraphs 16, 20 to 24 of Writ Petition 2840/1991 this is

what the appellant had to say.

"16. The petitioner now requested the Respondent Bank to refund the surplus amount to them. In a telegram to the Branch Manager, Industrial Estate Branch, Indore on 19.1.1980, the petitioners demanded the surplus amount along with the margin money lying as a deposit with the respondent Bank.

20. The petitioner wrote letters to the Chairman, Managing Director, General Manager, Assistant General Manager and Regional Manager of the respondents complaining about the tacit silence and the uncooperative approach of the respondents in settling the matter of the petitioners inspite of the directions given by this Hon'ble Court.

21. The respondents having failed to even respond to all the letters mentioned in the foregoing para No.20, the petitioner now tried to get succour from the Reserve Bank of India, Under-Secretary, Government of India, Ministry of Finance, New Delhi, between June 1988 to August, 1988.

22. The petitioner states that they approached the Branch Managers of the Respondents on innumerable occasions from Jan.1980 to August, 1988 but regretfully these officers of the Respondents failed to give any information regarding the appropriation 22

of the said amount or the surplus payable to the petitioner, or any statement of account.

23. Finally the petitioners by their advocate called upon the Respondents by their letter of 12.12.1988 to settle the petitioners' account or face legal action for illegally withholding the moneys of the petitioner without any justifiable cause and depriving them of the fruits of their business and profitability.

24. After their inaction for eight years the respondents replied to the notice of 12.12.1988 on 15.12.1988 denying the petitioner's contentions and raising frivolous objections regarding payments of the legitimate dues of the petitioners and merely calling the petitioners to move a "Proper Court" for obtaining appropriate orders.

17. It will be clear from a perusal of the aforesaid

averments that, taken at its very best in favour of the

appellant, his claim had been finally denied on 15th December

1988. It must, therefore, be held that the right to sue started

from that day. The appellant's plea that the limitation would

deem to have started w.e.f. 24.2.1995 is therefore, on the face

of it, unacceptable. It is further significant that on the

dismissal of W.P. No. 2840/1991 on 25.10.1991 by the

Bombay High Court, the appellant filed a Special Leave 23

Petition in this Court. This petition too was dismissed in-

limine on 10th February, 1992 with the following observations:

"The Special Leave Petition is dismissed. The remedy by way of Writ Petition was certainly not a proper remedy. Learned counsel for the petitioner states that he wants to file a suit. We are not concerned with any such thing. Mr. Agarwala, learned counsel for the respondent will file Vakalatnama within two days."

18. From a reading of the aforesaid order it transpires

that despite the statement that a civil suit would be filed, no

suit was filed within three years. The suit was filed but in the

year 1997 i.e. beyond the period of three years.

19. This Court in Mst. Rukhmabai vs. Lala

Laxminarayan & Ors. AIR 1960 SC 335 has observed as

under:

33. The legal position may be briefly stated thus: The right to sue under Art. 120 of the Limitation Act accrues when the defendant has clearly and unequivocally threatened to infringe the right asserted by the plaintiff in the suit. Every threat by a party to such a right, however ineffective and innocuous it may be, cannot be considered to be a clear and unequivocal threat so as to compel him to file a suit. Whether a particular threat gives rise to a compulsory cause of action depends 24

upon the question whether that threat effectively invades or jeopardizes the said right.

34. The facts relevant to the question of limitation in the present case may be briefly restated: The trust deed was executed in 1916. The suit house was constructed in 1920. If, as we have held, the trust deed as well as the construction of the building were for the benefit of the family, its execution could not constitute any invasion of the plaintiff's right. Till 1926, the plaintiff's father, Ratanlal was residing in that house. In 1928 when Daga challenged the trust deed, the family compromised the matter and salvaged the house. From 1936 onwards the plaintiff has been residing in the suit house.

It is conceded that he had knowledge of the litigation between Rukhmabai and Chandanlal claiming the property under the trust deed; but, for that suit he was not a party and the decision in that litigation did not in any way bind him or affect his possession of the house. But in execution of the decree, the Commissioner appointed by the Court came to the premises on February 13, 1937, to take measurements of the house for effecting partition of the property, when the plaintiff raised objection, and thereafter in 1940, filed the suit. From the aforesaid facts, it is manifest that the plaintiff's right to the property was not effectively threatened by the appellant till the Commissioner came to divide the property. It was only then there was an effectual threat to his right to the suit property and the suit was filed within six years thereafter. We, therefore, hold that the suit was within time.

25

Applying the aforesaid principle, it would be clear as per the

appellant's own showing that there had been a denial of the

appellant's claim on several occasions before 15th December

1988, but unequivocally on the 15th of December 1988. This

judgment was followed subsequently in M.V.S. Manikayala

Rao vs. M.Narasimhaswami & Ors. AIR 1966 SC 470. It

bears notice that Article 120 of the Limitation Act of 1908

largely corresponds to Article 113 of the Act, with the period of

limitation now being reduced from six to three years.

20. We are, therefore, of the opinion that Mr. Ray's

primary argument with regard to Article 113, does not

advance the case of the appellant. In the face of the above

undeniable facts, the large number of judgments cited by the

learned counsel for the parties with regard to the date on

which the cause of action would accrue need not be examined.

21. Mr. Ray has also submitted that it would be

inappropriate for a Public Sector Undertaking such as the

respondent-Bank to raise a plea of limitation especially when

the amount was due to the appellant. In this connection, the 26

learned counsel has cited The Madras Port Trust vs.

Hymanshu International AIR 1979 SC 1144 and UCO Bank

vs. Hem Chandra Sarkar AIR 1990 SC 1329. The learned

counsel for the respondent has, however, argued that no

proper calculation with respect to the amount that had been

decreed, had been made and whereas the appellant had

deposited in all less than Rs.10,000/- towards margin money

in the year 1979, there was no basis for decreeing the suit as

claimed for a sum of about Rs.24 Lakhs. It has also been

submitted that the appellant had threatened to initiate legal

proceedings from the year 1980 onwards and had actually

gone to court on several occasions and had remained

unsuccessful up to the Supreme Court in the year 1992 but

had filed the suit in the year 1997 and as such the Bank was

justified in taking the plea of limitation in the facts of the case.

We find merit in this argument. In Madras Port Trust's case

(supra) the suit had been decreed in favour of the private

party in the sum of Rs.4838.87 and special leave had been

granted by this Court subject to the payment of the aforesaid

amount irrespective of the result of the appeal, the more so as 27

the claim of the private party had been supported by the

Government Department concerned and it is in that situation

that the Supreme Court made the observation that a plea of

limitation should not be raised. In the UCO Bank's case

(supra), the appellant Bank had received the price of the

goods from the opposite party but had failed to deliver the

goods thereafter. This fact had been virtually admitted by the

representative of the Bank and in that backdrop this court

observed that it was not open to the Bank to contend that it

was not called upon to return the goods or in the alternative to

pay an equivalent as price to the plaintiff and it was observed

(Para 17) that:

"We may also state that in practice Bankers do not set up the statute of limitations against their customers or their legal representatives, and we see no reason why this case should be an exception to that practice."

22. The facts of the case before us are starkly different,

as would be seen from what has been narrated above.

Significantly also, the appellant, though a party to the

proceedings in Miscellaneous Application No. 950 of 1975, 28

did not put in appearance, nor shared the expenses (as

admitted by him in his evidence), but he wants to take

advantage of the situation now created. In this background

the Bank was fully justified in taking the plea of limitation.

We, therefore, find no merit in this appeal. It is accordingly

dismissed.

................................J. (TARUN CHATTERJEE)

................................J. (HARJIT SINGH BEDI) New Delhi, Dated: September 30, 2008