Supreme Court Upholds Dismissal of Suit as Time-Barred in Property Dispute: Sukhbiri Devi vs. Union of India (29 September 2022)

Date of the Judgment: 29 September 2022
Citation: 2022 INSC 469
Judges: Hon’ble Justices Ajay Rastogi and C.T. Ravikumar. The judgment was authored by Justice C.T. Ravikumar.

Can a civil suit be dismissed if it’s filed after the limitation period, even if the plaintiff claims fraud? The Supreme Court of India recently addressed this question in a case concerning a property dispute where a suit was dismissed as being barred by limitation. The court examined whether the lower courts were correct in dismissing the suit based on a preliminary issue of limitation.

Case Background

The case revolves around a dispute over agricultural land in Delhi, originally owned by Shri Rama Nand. The land was acquired by the government, and an award was passed on 09 January 1976. Rama Nand passed away, leaving behind his widow, two sons (Nahar Singh and Dhan Singh), and four daughters. After Rama Nand’s death, the government policy entitled the family to an alternative residential plot. This plot was allotted to Dhan Singh on 08 March 1991, based on a registered Relinquishment Deed purportedly signed by the other legal heirs in his favor. Nahar Singh objected to this allotment on 05 April 1991, claiming the Relinquishment Deed was fraudulent. Nahar Singh passed away on 14 May 1993. Subsequently, his widow and children continued to pursue the matter. They eventually filed a suit on 14 June 2000, seeking a declaration that they were co-owners of the allotted plot and that Dhan Singh was not the sole owner. The four daughters of Rama Nand were made proforma defendants in the suit.

Timeline:

Course of Proceedings

The Trial Court framed a preliminary issue on limitation, deciding that the suit was time-barred and dismissing it on 13 May 2005. The First Appellate Court upheld this decision on 08 December 2006. The High Court of Delhi also concurred with the lower courts and dismissed the second appeal on 25 August 2009. The High Court held that the suit was essentially for a declaration that the plaintiffs were co-owners of the property, and the limitation period for such a suit was three years from the date when the right to sue accrued. The High Court found that the cause of action arose when Nahar Singh became aware of the fraudulent relinquishment deed, which was more than three years before the suit was filed.

Legal Framework

The Supreme Court considered the following legal provisions:

• Order XIV, Rule 2(2) of the Code of Civil Procedure (CPC): This provision allows a court to decide a case on a preliminary issue of law, such as limitation, if it can dispose of the case. It states: “Where issues both of law and of fact arise in the same suit, and the Court is of opinion that the case or any part thereof may be disposed of on an issue of law only, it may try that issue first if that issue relates to (a) the jurisdiction of the Court, or (b) a bar to the suit created by any law for the time being in force, and for that purpose may, if it thinks fit, postpone the settlement of the other issues until after that issue has been determined, and may deal with the suit in accordance with the decision on that issue.”
• Article 136 of the Limitation Act, 1963: This article deals with the limitation period for the execution of decrees and orders of civil courts, providing a period of 12 years.
• Article 58 of the Limitation Act, 1963: This article provides a limitation period of three years for suits seeking a declaration, calculated from when the right to sue first accrues.
• Sections 17, 18 and 58 of the Indian Evidence Act: These sections deal with admissions made by a party and their evidentiary value.

Arguments

Appellants’ Arguments:

• The issue of limitation is a mixed question of law and fact and should not have been decided as a preliminary issue under Order XIV, Rule 2(2) of the CPC.
• If the issue of limitation was to be considered, it should have been under Order VII, Rule 11, CPC, which allows for the rejection of a plaint if it is barred by law.
• The suit should not have been dismissed based on a preliminary issue of limitation as it requires evidence.
• A larger period of limitation of 12 years should be available to them under Article 136 of the Limitation Act, 1963.
• Article 17 or Article 65 of the Limitation Act, 1963, should apply.
• Relinquishment deeds do not relinquish the share of the executant but only transfer shares.

Respondents’ Arguments:

• The suit was for a declaration, and the starting point of limitation was available in the plaint itself.
• Despite knowing about the Relinquishment Deed, the plaintiffs did not take legal action to have it set aside.
• Repeated representations to authorities would not extend the period of limitation.
• The suit was barred by limitation and was rightly dismissed.

Issues Framed by the Supreme Court

The Supreme Court framed the following issues:

1. Whether the issue of limitation can be determined as a preliminary issue under Order XIV, Rule 2(2) of the Code of Civil Procedure?
2. Whether a larger period of limitation of 12 years would be available to the plaintiffs by virtue of the application of Article 136 of the Limitation Act, 1963?
3. Whether Article 17 or Article 65 of the Limitation Act, 1963, has any application in view of the plaint averments if Article 136 is found inapplicable?

Treatment of the Issue by the Court

The following table demonstrates as to how the Court decided the issues:

Authorities

The Supreme Court considered the following authorities:

Cases:

• State of Rajasthan vs. Shiv Dayal [ (2019) 8 SCC 637 ] – Supreme Court of India: Reiterated that a concurrent finding of fact is binding unless it is perverse.
• Rajeshwar Vishwanath Mamidwar & Ors. vs. Dashrath Narayan Chilwelkar & Ors. [AIR 1943 Nagpur 117] – Nagpur High Court: Outlined the grounds for assailing a concurrent finding of fact.
• C. Natarajan Vs. Ashim Bai & Anr. [(2007) 14 SCC 183] – Supreme Court of India: Discussed the rejection of plaints under Order VII, Rule 11(d), CPC.
• Popat And Kotecha Property Vs. State Bank of India Staff Assn [(2005) 7 SCC 510] – Supreme Court of India: Discussed the rejection of plaints under Order VII, Rule 11(d), CPC.
• Daya Singh & Anr. Vs. Gurdev Singh (Dead) by LRs. & Ors. [(2010) 2 SCC 194] – Supreme Court of India: Discussed the accrual of the ‘right to sue’ for declaration.
• Mt. Bolo vs. Mt. Koklan [AIR 1930 PC 270] – Privy Council: Held that the right to sue accrues when there is an infringement or threat to the right asserted in the suit.
• Mst. Rukhmabai Vs. Lala Laxminarayan [1960 (2) SCR 253] – Supreme Court of India: Discussed the limitation period for suits seeking declaration of a deed as sham.
• Mongin Realty and Build Well Private Limited vs. Manik Sethi [2022 SCC Online SC 156] – Supreme Court of India: Discussed the determination of limitation as a preliminary issue.
• Nusli Neville Wadia Vs. Ivory Properties [(2020) 6 SCC 557] – Supreme Court of India: Held that the issue of limitation can be decided as a preliminary issue if based on admitted facts.
• National Insurance Co. Ltd. Vs. Rattani [(2009) 2 SCC 75] – Supreme Court of India: Held that an admission made in the pleadings by a party is admissible in evidence proprio vigore.
• Ranganayakamma & Anr. Vs. K.S. Prakash (Dead) By LRs. & Ors. [(2008) 15 SCC 673] – Supreme Court of India: Held that an admission made by a party in his pleadings is admissible against him proprio vigore.
• Vimal Chand Ghevarchand Jain & Ors. Vs. Ramakant Eknath Jadoo [(2009) 5 SCC 713] – Supreme Court of India: Held that an admission made by a party in his pleadings is admissible against him proprio vigore.
• Bikoba Deora Gaikwad & Ors. vs. Hirabai Marutirao Ghorgare & Ors. [(2008) 8 SCC 198] – Supreme Court of India: Explained the application of Article 136 of the Limitation Act.
• Narinder Kaur & Anr. Vs. Amar Jeet Singh Sethi & Anr. [2000 III A D (Delhi) 599] – Delhi High Court: Discussed the effect of relinquishment deeds.
• M/s Crescent Petroleum Ltd. Vs. M.V. Monchegorsk & Ors. [AIR 2000 Bombay 161] – Bombay High Court: Discussed the power of dismissal of a suit for lack of cause of action.

Legal Provisions:

• Order XIV, Rule 2(2) of the Code of Civil Procedure (CPC): Allows for the determination of preliminary issues.
• Article 136 of the Limitation Act, 1963: Pertains to the limitation period for the execution of decrees.
• Article 58 of the Limitation Act, 1963: Pertains to the limitation period for suits seeking a declaration.
• Sections 17, 18 and 58 of the Indian Evidence Act: Relate to admissions and facts admitted.

Judgment

How each authority was viewed by the Court:

• State of Rajasthan vs. Shiv Dayal [(2019) 8 SCC 637]*: The Court reiterated that concurrent findings of fact are binding unless perverse.
• Rajeshwar Vishwanath Mamidwar & Ors. vs. Dashrath Narayan Chilwelkar & Ors. [AIR 1943 Nagpur 117]*: The Court used this to define the grounds for challenging a concurrent finding of fact.
• C. Natarajan Vs. Ashim Bai & Anr. [(2007) 14 SCC 183]* and Popat And Kotecha Property Vs. State Bank of India Staff Assn [(2005) 7 SCC 510]*: These cases were distinguished as they dealt with rejection of plaints under Order VII, Rule 11(d), CPC, unlike the present case which was dismissed based on a preliminary issue.
• Daya Singh & Anr. Vs. Gurdev Singh (Dead) by LRs. & Ors. [(2010) 2 SCC 194]* and Mt. Bolo vs. Mt. Koklan [AIR 1930 PC 270]*: The Court referred to these cases to explain when the ‘right to sue’ accrues, stating that it is when there is an infringement or a clear threat to the right.
• Mst. Rukhmabai Vs. Lala Laxminarayan [1960 (2) SCR 253]*: The Court used this to explain that the ‘right to sue’ accrues when there is a clear and unequivocal threat to the right.
• Mongin Realty and Build Well Private Limited vs. Manik Sethi [2022 SCC Online SC 156]* and Nusli Neville Wadia Vs. Ivory Properties [(2020) 6 SCC 557]*: The Court relied on these to establish that the issue of limitation can be decided as a preliminary issue under Order XIV, Rule 2(2)(b), CPC, if based on admitted facts.
• National Insurance Co. Ltd. Vs. Rattani [(2009) 2 SCC 75]*, Ranganayakamma & Anr. Vs. K.S. Prakash (Dead) By LRs. & Ors. [(2008) 15 SCC 673]* and Vimal Chand Ghevarchand Jain & Ors. Vs. Ramakant Eknath Jadoo [(2009) 5 SCC 713]*: These cases were used to emphasize that admissions in pleadings are admissible as evidence.
• Bikoba Deora Gaikwad & Ors. vs. Hirabai Marutirao Ghorgare & Ors. [(2008) 8 SCC 198]*: The Court used this to explain that Article 136 of the Limitation Act applies only to the execution of decrees, not to suits for declaration.
• Narinder Kaur & Anr. Vs. Amar Jeet Singh Sethi & Anr. [2000 III A D (Delhi) 599]*: The Court distinguished that the issue of limitation is to be considered not with reference to the validity of the Relinquishment Deed.
• M/s Crescent Petroleum Ltd. Vs. M.V. Monchegorsk & Ors. [AIR 2000 Bombay 161]*: The Court distinguished this case as the present case was not dismissed for lack of cause of action, but for being time-barred.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily influenced by the admissions made by the plaintiffs in their plaint, which clearly indicated the starting point of limitation. The Court emphasized that when the foundational facts determining the starting point of limitation are admitted in the plaint, the issue of limitation becomes a pure question of law that can be decided as a preliminary issue. The Court also highlighted the importance of adhering to prescribed legal timelines and that repeated representations to authorities do not extend the limitation period. The Court held that the suit was essentially for a declaration of co-ownership, and the limitation period for such suits is three years from when the right to sue accrues.

Fact:Law Ratio:

The court’s reasoning was heavily influenced by the legal framework and the established principles of limitation, with a smaller emphasis on the factual aspects of the case.

Logical Reasoning

Key Takeaways

• A suit for declaration of co-ownership must be filed within three years from the date when the right to sue accrues.
• Admissions made in the plaint can be used to determine the starting point of limitation.
• Repeated representations to authorities do not extend the period of limitation.
• The issue of limitation can be decided as a preliminary issue if the facts determining the starting point of limitation are admitted in the plaint.
• Article 136 of the Limitation Act applies only to the execution of decrees, not to suits for declaration.

Directions

The Supreme Court did not issue any specific directions in this judgment. The appeal was dismissed with costs.

Amendments to the Law

This judgment did not introduce any new amendments to the law. It primarily clarified the application of existing provisions, particularly Order XIV, Rule 2(2) of the Code of Civil Procedure and Article 58 of the Limitation Act, 1963. The court reiterated the principle that the issue of limitation can be decided as a preliminary issue if the starting point of limitation is based on admitted facts in the plaint. It also reinforced that Article 136 of the Limitation Act applies only to the execution of decrees and not to suits for declaration of ownership.

Impact of the Judgment

This judgment reinforces the importance of adhering to the prescribed timelines in legal proceedings and provides clarity on how limitation issues are to be dealt with. It emphasizes that factual admissions in pleadings can significantly affect the outcome of a case, particularly on the issue of limitation. The judgment serves as a reminder to litigants to be vigilant about the limitation period and to ensure that suits are filed within the stipulated time. It also clarifies that repeated representations to authorities do not extend the period of limitation. This ruling is likely to be cited in future cases involving similar issues of limitation in civil suits, particularly those related to property disputes and declarations of ownership.

Conclusion

The Supreme Court’s decision in Sukhbiri Devi vs. Union of India (2022) underscores the importance of adhering to limitation periods in civil suits. The Court upheld the dismissal of the suit as time-barred, emphasizing that the starting point of limitation can be determined from admissions in the plaint. The judgment clarifies that Article 58 of the Limitation Act, 1963, applies to suits seeking a declaration, and that the right to sue accrues when there is a clear threat or infringement of a right. This ruling reinforces the need for timely legal action and serves as a reminder that repeated representations to authorities do not extend the limitation period. The Supreme Court’s stance is clear: when foundational facts determining the starting point of limitation are admitted in the plaint, the issue of limitation becomes a question of law that can be decided as a preliminary issue, thereby preventing frivolous and delayed litigation.