INTRODUCTION : LIMITATION ACT

THE SCHEME AND APPLICATION OF ACT

The act came into force from 1st January 1964. It consists of 32 sections and one schedule.

  • Part I – Section 1-2: Preliminary
  • Part II – Section 3-11: Limitation o suits, appeals and applications.
  • Part III – Section 12-24: Computation of period of limitation.
  • Part IV – Section 25-27: Acquisition of ownership by possession (including profits a pendre) by positive prescription.
  • Part V – Section 28-32: Miscellaneous provisions.

The schedule is divided into three divisions.

  • The first division (Article 1 to 113) deals with the suits.
  • The second division (article 114 to 117) deals with appeals.
  • The third division (Article 118 to 137) deals with applications and petitions.

“Controversies are limited to a fixed period of time, lest they should be immortal while men are mortal.” – John Voet

The word limitation in its literal term means a restriction or the rule or circumstances which are limited. The Law of Limitations limits or prescribes a time after the lapse of which suit or other proceedings cannot be maintained in a Court of law or the persons liable to sue shall become exempt from answering therein. It does not postpone or suspend the right of claimants, it merely prescribes a period for the institution of suit and forbids them from being brought after periods, each of which starts from some definite event. It only restrains the holder of a right from enforcing his right by recourse to law after prescribed period of limitation.

The basic concept of limitation is relating to fixing or prescribing of the time period for barring legal actions.

The solid foundation on which the Limitation Act is founded is that on the expiry of the period of limitation, the right is not lost, but only the remedy by way of suit in a court is lost. Hence, the right continues to exist, and, any other remedy available or possible may be resorted to.

If, therefore, a creditor, whose debt becomes barred, has any means of realizing or enforcing his claim by any method except by a suit, the Limitation Act does not prevent him from recovering it.

Not being aware of the period of limitation, a debtor may pay the creditor a time-barred debt. However, once paid he cannot recover the same money from the creditor. The reason is that the right of the creditor continues, but only his remedy is barred.

Similarly in the case of a set-off, a set-off being a cross-suit, it will be dismissed if it is in respect of a time-barred debt.

A is due to B Rs.5, 000/-; B is due to A Rs.2,000/- but barred by time.

Hence a set off of Rs.2, 000/- in Rs.5,000/- is not allowed

The reason is that the right of Y to recover Rs.2, 000/- is barred under a suit.

An advocate’s remedy to recover his fees from his client is barred after 3 years. However, he may keep a lien over the records of the client and recover the dues from him. The right is not extinguished, but only the remedy is lost.

A Vendor’s right to recover his purchase money from the vendee is lost after 3 years. But, if he is still in possession of the goods, he may retain the goods and the vendee cannot claim the goods.

According to Section 2 (j) of the Limitation Act, 1963, ‘period of limitation’ means the period of limitation prescribed for any suit, appeal or application by the Schedule, and ‘prescribed period’ means the period of limitation computed in accordance with the provisions of this Act.

In the matter of B.B. & D. Mfg. Co. v. ESI Corporation, AIR 1972 SC 1935 it was observed by the Supreme Court that- “The object of the Statutes of Limitations to compel a person to exercise his rights of action within a reasonable time as also to discourage and suppress stale fake or fraudulent claims. While this is so, there are two aspects of the Statutes of Limitation — the one concerns with the extinguishment of the right if a claim or action is not commenced within a particular time and the other merely bars the claim without affecting the right which either remains merely as a moral obligation or can be availed of to furnish the consideration for a fresh enforceable obligation. Where a statute prescribing the limitation extinguishes the right if affects substantive right while that which purely pertains to the commencement of action without touching the right is said to be procedural”.

In case Alapati Syamaladoss vs. Doradha Subbayyou, Jackson, J., It is mistake to hold that a peculiar equity lies in overriding limitation. A decree holder does not obtain a decree which but for merely technical & possibly unjust provision of limitation; he would be at liberty to execute at any time he pleased. He obtains a decree which he must execute before expiration of twelve years, and the law which limits the period is neither more nor less just than the law which authorizes the decree. A judge takes a peculiar view of his office who thinks it incumbent on him when administering a statute to pick out certain clauses which it is his duty to enforce and certain clauses which it is his duty to evade.

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