1 S.B.CIVIL MISC. APPEAL NO.576/2001 IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JAIPUR BENCH, JAIPUR ORDER S.B.CIVIL MISC. APPEAL NO.576/2001. Modern Mech. & Electrical Eng. VERSUS Rajasthan Financial Corporation. 04.02.2009. HON'BLE MR.JUSTICE DALIP SINGH Miss Anupama Parashar, for the appellant. Mr.S.C.Mittal, for the respondent. ***** This appeal has been filed by the non-applicant/ appellant against the judgment dated 21.03.2001 passed by the learned Additional District Judge No.3, Jaipur City, Jaipur in Civil Misc. Case No.1/1995. The respondent-Rajasthan Financial Corporation filed an application under Section 31 of the State Financial Corporation Act, 1951 for proceeding against the appellant for recovery of the amount due from the appellant. The facts, in brief are that the appellant applied for a loan in the year 1977 and the respondent- Rajasthan Financial Corporation sanctioned an amount of Rs.1,50,000/- in favour of the appellant. After the sanction, the amount came to be paid to the appellant 2 S.B.CIVIL MISC. APPEAL NO.576/2001 on or about 25.11.1978. It was stipulated that the amount was to be repaid in quarterly installments in a period of 10 years and the first installment was to fall due on the 15th month after the payment of the amount. Likewise, another loan was sanctioned in favour of the appellant on their application dated 06.03.1980 and the same was disbursed on similar terms on 05.08.1980. In respect of both the loans, the appellant became a defaulter and, therefore, the respondent-Rajasthan Financial Corporation sent a notice to the appellant under the provisions of the Act for proceeding under Section 31 on 20.07.1994 calling upon the appellant to make the payment in respect of both the amounts. Since the appellant did not pay the amount despite the notice, the respondent filed an application under Section 31 of the State Financial Corporation Act with the court on 15.04.1995. Apart from the other objections which were raised the appellant submitted that the proceedings under Section 31 had been initiated by the respondent- Rajasthan Financial Corporation against the appellant 3 S.B.CIVIL MISC. APPEAL NO.576/2001 after a period of 14 years and, therefore, the same was barred by limitation. The learned Additional District Judge who heard the application decided the issue No.3 with regard to the limitation in favour of the Corporation and rejected the objections filed by the appellant and passed an order for recovery of the amount. Being aggrieved by the aforesaid order of the learned Additional District Judge dated 21.03.2001, the appellant has preferred this appeal under Section 32 (9) of the State Financial Corporation Act, 1951 read with Order 43 Rule 1 C.P.C. Learned counsel for the appellant submitted that the application was time barred and that, as has been held by the Hon'ble Supreme Court in the case of Maharashtra State Financial Corporation Vs. Ashok K.Agarwal and Others reported in JT 2006 (4) SC 197 the limitation for the recovery of the amount would be as prescribed under Article 137 of the Limitation Act, 1963 and, therefore, the application was required to be filed within three years and that the provisions of Article 136, in the facts and circumstances, are not 4 S.B.CIVIL MISC. APPEAL NO.576/2001 attracted as held by the learned Additional District Judge. Learned counsel appearing for the respondent, on the other hand, submitted that in the instant case the provisions of Article 136 which provide for a period of 12 years as limitation is applicable and not three years, as submitted by the learned counsel for the appellant. I have heard learned counsel for the parties and perused the impugned judgment as well as the judgment of the Hon'ble Supreme Court in the Maharashtra State Financial Corporation's case (supra) goes to show that the Hon'ble Supreme Court in para 5 has discussed in detail that the provisions of Article 136 have no application in the case of the recovery application under Section 31 of the State Financial Corporation Act as it cannot be said to be the proceedings for execution of the decree or the order. The Hon'ble Supreme Court in para 5 of the report held as follows:- “5. Sections 31 of the Act contains special provisions for enforcement of claims by State Financial Corporations. It is by way of 5 S.B.CIVIL MISC. APPEAL NO.576/2001 a legal fiction that the procedure akin to xecution of decrees under the Code of Civil Procedure has been permitted to be invoked. But one cannot lose sight of the fact that there is no decree or order of a civil court when we are dealing with applications under Section 31 of the Act. The legal fiction at best refers to a procedure to be followed. It does not mean that a decree or order of a civil court is being executed, which is a sine qua non for invoking Article 136. The proposition set out in the case of Gujarat State Financial Corporation (supra) found support in M/s. Everest Industrial Corporation and Others v. Gujarat State Financial Corporation 1987 (3) SCC 597. Again in Maganlal etc. vs. Jaiswal Industries Neemach & Ors. 1989 (3) SCR 696 this court noticed that an order under Section 32 is not a decree stricto sensu as defined in Section 2 (2) of the Code of Civil Procedure, the financial Corporation could not be said to be a decree holder. This makes it clear that while dealing with an application under Sections 31 and 32 of the Act there is no decree or order of a civil court being executed. It was only on the basis of a legal fiction that the proceedings under Section 31 are treated as akin to execution proceedings. In fact this Court has observed that there is no decree to be executed nor there is any decree holder or judgment debtor and therefore in a strict sense it cannot be said to be a case of execution of a decree. Article 136 of the Limitation Act has no application in the facts of the present case. Article 136 specifically uses the words "decree or order of any civil court". The application under Sections 31 and 32 of the State Financial Corporation Act is not by way of execution of a decree or order of any civil court.” (Emphasis supplied.) A look at the above passage from the aforesaid judgment of the Hon'ble Supreme Court clearly shows 6 S.B.CIVIL MISC. APPEAL NO.576/2001 that the Hon'ble Supreme Court has drawn a distinction between the proceedings under Section 31 of the State Financial Corporation Act, 1951 and the proceedings in execution of a decree. The Hon'ble Supreme Court has clearly held that there being no decree to be executed unlike a decree of the civil court in a regular suit, the application under Section 31 and 32 cannot be said to be by way of execution of a decree or order of any civil court. Article 136 in column of description of the application clearly provides as follows:- “For the execution of any decree (other than a decree granting a mandatory injunction) or order of any civil court.” (Emphasis supplied.) The period of limitation prescribed against the said entry is twelve years. The two terms “execution of any decree” and “of any civil court” are of vital importance. The two terms, therefore, clarify the nature of the proceedings referred to under Article 136. In the light of the above, the Hon'ble Supreme Court in para 5 of the report clearly held that the application under Section 31 and 32 cannot be put at par with an execution application for seeking execution of the decree of civil court. Having excluded the applicability of the Article 136 of the Limitation Act, to an application under Section 31 and 32 of the State Financial Corporation Act, 1961, the Hon'ble Supreme Court thereafter in 7 S.B.CIVIL MISC. APPEAL NO.576/2001 para 6 of the report has clearly held that Article 137 of the Limitation Act applies in the facts of the present case. On the basis of the above, it held that the limitation for moving an application under Section 31 of the Act of 1951 would be three years. Admittedly, in the instant case, the present application has not been filed within three years as contemplated by Article 137. The application, therefore, would be barred by limitation. The learned Additional District Judge while deciding issue No.3 on the question of limitation took into consideration the judgment of this court in S.B.Civil Revision Petition No.273/1997 wherein this court had held as follows:- “In view of the aforesaid position in law, conclusion is inevitable that the period prescribed under Article 136 of the Limitation Act and not Article 137 thereof is applicable to an application under Section 31 (1) of the Act.” It may be stated here that this case was decided by this court prior to the judgment of the Hon'ble Supreme Court in Maharashtra State Financial Corporation's case (supra) on 14th July, 1997. Thereafter, the Hon'ble Supreme Court in the abovenoted case has clearly held that “Article 136 of the Limitation Act has no application” to the application under Section 31. Thus, the view taken by this court which has been relied upon by the learned Additional District Judge having been overruled the 8 S.B.CIVIL MISC. APPEAL NO.576/2001 findings on issue No.3 relating to limitation have to be set aside. It is thus held that since the limitation as prescribed under Article 136 is not applicable the respondent cannot contend that the application is within time having been filed within twelve years. The submission of the learned counsel for the respondent-Rajasthan Financial Corporation that the period of limitation should exclude the period during which the proceedings remained stayed on account of the order of injunction is also without merit. The order of injunction, in the instant case, as was admitted by the learned counsel for the respondent was passed in the year 1990 and the same came to be vacated as per the submission of the learned counsel for the respondent in the year 1996 whereas this application came to be filed by the respondents on 15.04.1995 during the currency of the alleged period of stay. The respondent, therefore, cannot be held entitled to the protection of Section 15 of the Limitation Act, 1963 as on facts it cannot be said that the respondent- Corporation was prevented from filing the application under Section 31 on account of the restraint order. In the present case as was submitted the application came to be filed during the period when the restraint order was in force. The principle underlying the object of Section 15 is that if the litigant is on account of the act of the court prevented from seeking recourse to the remedy the period during which he is under such restraint on account of the orders of the court shall be excluded. 9 S.B.CIVIL MISC. APPEAL NO.576/2001 In the instant case, however, firstly this plea was not raised before the learned court below and the facts on which such a plea has been raised are also not on record. These facts were only submitted by the learned counsel during the course of hearing, as such, a plea of this nature on the basis of Section 15 of the Limitation Act, 1963 cannot be permitted to be raised for the first time in appeal. Even otherwise, I am of the opinion that in the facts of the present case this plea is without substance. The application was filed during the currency of the alleged order of stay on 15.04.1995. This alleged stay order, the terms and language of which we are not even aware of, was vacated after the application under Section 31 was filed. Hence, the respondent cannot claim that the respondent was prevented from filing the petition under Section 31 on account of the alleged stay order and hence, the period during which the stay order was in force should be excluded cannot be accepted. The submission of the learned counsel for the respondent, therefore, is rejected. In the facts and circumstances, I am inclined to allow this appeal and set aside the order passed by the learned Additional District Judge dated 21.03.2001. The application filed by the respondent is dismissed as being barred by limitation. There shall be no order as to costs. (DALIP SINGH),J. Solanki DS, Jr.P.A.