Case: M/S. SHAKTI BHOG FOOD INDUSTRIES LTD Vs. THE CENTRAL BANK OF INDIA

The Additional District & Sessions Judge, Central, Tis Hazari Courts, Delhi, vide order dated 23.7.2016 in R.C.A. No. 61794/2016 had also affirmed the order of rejecting the plaint. The appellant had filed the stated suit on 23.2.2005 for a decree for rendition of true and correct accounts in respect of the interest/commission charged and deducted by the respondent-Bank relating to current account No. CCM 20225 of the appellant for the period between 1.4.1997 and 31.12.2000 and also for recovery of the excess amount charged by the respondent-Bank consequent to rendition of accounts with interest at the rate of 18% per annum from the date of deduction including interest pendente lite realization of the amount and future interest.3. The plaint came to be rejected by the trial Court under Order VII Rule 11(d) of the CPC on the ground that it was barred by law of limitation, as it was filed beyond the period of three years prescribed in Article 113 of the Limitation Act, 1963 (for short, the 1963 Act), as applicable to the present case, from the date when the right to sue accrued to the appellant in October, 2000. The entire discussion of the trial Court in that regard can be traced to paragraphs 10 and 11, which read thus: -10. As stated above the plaintiff by way of present suit has sought two reliefs i.e. rendition of account and repayment of excess money. Limitation Act, 1963 does not provide any specific article with regard to time period within which accounts can be sought by party from its bank. As such, Article 113 of Limitation Act came into picture which provides a limitation period of three years for suits for which no limitation period is provided, from the date when right to sue accrues.11. In the present case in hand, as per averments made by the plaintiff in his plaint, the facility was availed by the plaintiff from the defendants till October 2000. Further as per averments made in the plaint the alleged amount so charged by the defendant from the plaintiff, in excess from agreed amount, was till October, 2000. As such, at best can be said right to sue accrues in favour of the plaintiff in October, 2000. Considering the law as stated in above paragraph, plaintiff could have filed the present suit i.e. for rendition of account and repayment of excess amount till October 2003. ...After so observing, the trial Court considered the submission of the appellant that the cause of action had accrued to the appellant only upon rejection of the representation by the respondent-Bank entailing in refusal or denial of liability, communicated to the appellant vide letters dated 19.9.2002 and 3.6.2003 and after the final legal notice was served upon the respondents on 7.1.2005. That contention has been rejected by adverting to the decision of the same High Court in C.P. Kapur vs. The Chairman & Ors. (2013) 198 DLT 56, wherein it is held that exchange of correspondence between the parties cannot extend the limitation period for institution of a suit, once the right to sue had accrued, which in this case had accrued in October, 2000, as has been asserted even in the plaint. Whereas, the suit was filed in February, 2005 beyond the period of three years from the date on which right to sue accrued to the appellant, as prescribed in Article 113 of the 1963 Act. The view so taken by the trial Court commended to the District Court in first appeal and also the High Court in second appeal, which judgment is the subject matter of challenge in the present appeal.CIVIL APPEAL NO. 2515 OF 2020 (Arising out of SLP (C) No. 30210/2017)1. Leave granted.2. In the present appeal, the factual narration in the plaint is similar in material respects, if not identical to the plaint in the companion appeal arising from SLP(C) No. 30209/2017. To wit, it is apposite to reproduce relevant averments from the plaint in question, which read as follows: -8. That the facility as referred to in the foregoing paras was extended with effect from the month of November, 1997 to December, 1999 and somewhere in the month of July, 2000 it was noticed by the plaintiff that the defendants were charging interest/commission @ Rs.4/- per thousand rupees on local cheques and drafts in an arbitrary manner in violation of the assurance given to the plaintiff.9. That after the detection of the above overcharging the interest/commission the plaintiff sent a letter to the defendants on 21.7.2000 complaining about the overcharging and thereafter the interest/commission was charged as per assurance given.10. That the amount overcharged as commission/interest was not refunded to the plaintiff and the plaintiff sent the following letters addressed to the Bank i.e. General Manager and Senior Manager indicating therein that the amount overcharged should be refunded to the plaintiff with interest thereon: -Letter dated 12.10.2000, 24.10.2000, 30.10.2000, 7.11.2000, 24.12.2000, 01.03.2001, 28.03.2001, 22.05.2001 and 20.06.2001. In all the above letters requests were made to clarify as to how the commission was calculated and deducted from the plaintiff.11. That the Assistant General Manager, Sh. P.S. Bawa of Regional Office-B, Delhi vide letter dated 9.7.2001 informed the plaintiff that the comments of the Branch Office have been invited on the representation of the plaintiff in respect of the local cheques/DDs discounted during the relevant period and the matter will be decided as early as possible. No progress was made in the matter and the plaintiff had to submit letter dated 31.10.2001 to the Honble Finance Minister, Govt. of India, New Delhi.12. That the defendants have charged interest for some time for the actual number of days for the defendants remained out of funds.13. That vide letter dated 08.05.2002, the Senior Manager informed the plaintiff that the cheques were being purchased at the prevailing rates. That reply was given to sidetrack the real issue in respect of which letter dated 09.07.2001 was received from Sh. P.S. Bawa, Assistant General Manager of Regional Office as referred to in the foregoing paras.14. That, thereafter, the plaintiff sent letters dated 12.07.2002, 22.07.2002, 24.03.2003 along with which the details of the proposed/estimated excess amount charged were given and it was requested that a sum of Rs.5,39,902/- approximately appears to have been charged in excess of what should have been actually charged and the exact amount should be calculated and refunded to the plaintiff. No reply was given by the bank to these letters.15. That Senior Manager of the defendant No.2 vide letter dated 19.09.2002 had informed that everything was done according to rules and the matters need not to be pursued any further and thereafter the plaintiff sent another letter dated 3.06.2003.16. That the excess amounts have been recovered/charged from the plaintiff in an arbitrary manner, in utter violation of the assurances, rules, regulations and established cannons of business dealings; and inspite of the protracted correspondence made from 21.07.2000 to 03.06.2003, the defendants have failed to account for or to justify the recovery of amounts made in an arbitrary manner by citing any rules, regulations or any other authority.xxx xxx xxx18. That thereafter, the plaintiff got a legal notice served upon the defendant vide registered letter No.6672 dated 03.12.2003 containing all the details relating to the transactions as could be gathered from the books of accounts of the plaintiff.19. That reply to the above noted notice was sent by the defendants through Sh. Sanjeev Kumar Gupta, Advocate, vide letter dated 23.12.2003 wherein averments relating to the excess charges were denied and it was stated that the interest was charged on DD/cheques as per Central Officer Circular No. C094-95; 233 upto 01.12.1999 and thereafter as per Circular No. CO/OPR/SCHGS/CIR/LET/2000-2001 dated 18.08.2000.Again, in paragraph 28, it is stated as follows: -28. That the cause of action to file the suit accrued in favour of the plaintiff and against the defendants when the illegal recoveries were noticed and letter dated 21.07.2000 was sent to the defendants to clarify as to how the interest was being calculated and recovered and on various other dates when the letters were sent to the defendants with request for refund of the excess amounts charged and on 9.7.2001 when assurance for proper calculation and refund was conveyed to the plaintiff and on 8.5.2002, 12.7.2002 and 22.9.2002 when requests were again made to settle the matter on 19.9.2002, 3.6.2003 and their cause of action arose on 28.12.2003 where the legal notice was served upon the defendant and on 23.12.2003 when the reply to the notice was received and finally on 08.01.2005 when the legal notice for rendition of accounts was served upon the defendants and the cause of action still subsists as the accounts have not been rendered so far nor the excess amount charged has been refunded by the Defendants.

Reasoning:
5. Be it noted that the appellant had relied on Articles 2, 3 and 22 of the 1963 Act to urge that the suit filed in February, 2005 was within limitation. This plea, however, did not impress the trial Court, the first appellate Court or the High Court. The Courts proceeded on the basis that Article 113 is attracted in the facts of the present case, as the reliefs claimed by the appellant were not covered under any specific Article with regard to time period within which accounts can be sought by party from its bank, as noted by the trial Court in paragraph 10 of its judgment reproduced above.Indeed, Order VII Rule 11 of the CPC gives ample power to the Court to reject the plaint, if from the averments in the plaint, it is evident that the suit is barred by any law including the law of limitation. This position is no more res integra.As noticed from the trial Court judgment, it is evident that the trial Court did not make any attempt to analyse the plaint in the manner predicated in the aforesaid decisions. Even the District Court dealing with first appeal and the High Court with second appeal omitted to do so. It is the bounden duty of the Court to examine the plaint as a whole and not selected averments therein.From the averments in the plaint, if read as a whole, it would appear that the assertion of the appellant is that the respondents had extended financial facility with effect from 1.4.1997 till October, 2007, but somewhere in the month of July, 2000, the appellant noticed that the respondents were unilaterally charging interest/commission at the rate of Rs.4 per thousand rupees on local cheques and drafts in an arbitrary manner in violation of the assurance given to the appellant.7. All these events have been reiterated in paragraph 28 of the plaint, dealing with the cause of action for filing of the suit. Indeed, the said paragraph opens with the expression the cause of action to file the suit accrued in favour of the plaintiff and against the defendants when the illegal recoveries were noticed and letter dated 21.7.2000 was sent to the defendants to clarify as to how the interest was being calculated. This averment cannot be read in isolation. As aforesaid, on reading the plaint as a whole, it is seen that the gravamen of the case made out in the plaint is that the appellant noticed the discrepancy in July, 2000 and immediately took up the matter with the officials of the respondent-Bank at different levels and in response, the Assistant General Manager of Regional Office of the Bank had communicated in writing to the appellant vide letter dated 9.7.2001 that its representation was being examined and comments of the Branch Office have been invited and after receipt thereof the matter will be decided as early as possible. As no further communication was received by the appellant, it had to make a representation to the Finance Minister, Government of India, vide letter dated 31.10.2001 and presumably because of that, the appellant received a communication from the Senior Manager vide letter dated 8.5.2002 informing the appellant that the cheques were being purchased at the prevailing rates. This stand taken by the Senior Manager was to side-track the issue pending consideration before the Assistant General Manager, Regional Office referred to in his letter dated 9.7.2001. The case made out by the appellant is that no communication was received by the appellant from the Assistant General Manager, Regional Office and instead, for the first time it was informed vide letter dated 19.9.2002 sent by the Senior Manager of the respondent-Bank, that all actions taken by the Bank are as per the rules and, therefore, the appellant need not correspond in this regard any further. This response of the Bank could also be regarded as a firm denial or refusal by the authorised official of the Bank, giving rise to cause of action to sue the Bank.8. Thus understood, the letter dated 8.5.2002 sent by the Senior Manager of the respondent-Bank, at best, be reckoned as accrual of the cause of action to the appellant to sue the respondent-Bank. It is then stated that the appellant received a communication dated 19.9.2002, informing the appellant that it should not carry on any further correspondence with the Bank relating to the subject matter. Until then, the appellant was having a sanguine hope of favourable resolution of its claim including by the Regional Office of the respondents. The appellant, therefore, had to send a legal notice on 28.11.2003, to which the Bank responded on 23.12.2003. Reckoning these dates, the plaint filed on 23.2.2005 was within limitation, as stated in paragraph 28 of the plaint. Resultantly, the question of rejecting such a plaint under Order VII Rule 11(d) of the CPC did not arise.9. The expression used in Article 113 of the 1963 Act is when the right to sue accrues, which is markedly distinct from the expression used in other Articles in First Division of the Schedule dealing with suits, which unambiguously refer to the happening of a specified event. Whereas, Article 113 being a residuary clause and which has been invoked by all the three Courts in this case, does not specify happening of particular event as such, but merely refers to the accrual of cause of action on the basis of which the right to sue would accrue.13. It is well established position that the cause of action for filing a suit would consist of bundle of facts. Further, the factum of suit being barred by limitation, ordinarily, would be a mixed question of fact and law. Even for that reason, invoking Order VII Rule 11 of the CPC is ruled out. In the present case, the assertion in the plaint is that the appellant verily believed that its claim was being processed by the Regional Office and the Regional Office would be taking appropriate decision at the earliest. That belief was shaken after receipt of letter from the Senior Manager of the Bank, dated 8.5.2002 followed by another letter dated 19.9.2002 to the effect that the action taken by the Bank was in accordance with the rules and the appellant need not correspond with the Bank in that regard any further. This firm response from the respondent-Bank could trigger the right of the appellant to sue the respondent-Bank. Moreover, the fact that the appellant had eventually sent a legal notice on 28.11.2003 and again on 7.1.2005 and then filed the suit on 23.2.2005, is also invoked as giving rise to cause of action. Whether this plea taken by the appellant is genuine and legitimate, would be a mixed question of fact and law, depending on the response of the respondents.14. Reverting to the argument that exchange of letters or correspondence between the parties cannot be the basis to extend the period of limitation, in our opinion, for the view taken by us hitherto, the same need not be dilated further. Inasmuch as, having noticed from the averments in the plaint that the right to sue accrued to the appellant on receiving letter from the Senior Manager, dated 8.5.2002, and in particular letter dated 19.9.2002, and again on firm refusal by the respondents vide Advocates letter dated 23.12.2003 in response to the legal notice sent by the appellant on 28.11.2003; and once again on the follow up legal notice on 7.1.2005, the plaint filed in February, 2005 would be well within limitation. Considering the former events of firm response by the respondents on 8.5.2002 and in particular, 19.9.2002, the correspondence ensued thereafter including the two legal notices sent by the appellant, even if disregarded, the plaint/suit filed on 23.2.2005 would be within limitation in terms of Article 113.Suffice it to observe that going by the averments in the plaint, the argument of the respondents that the appellant had placed reliance on the correspondence to get extension of the limitation period, is untenable. The averments in the plaint, however, are very explicit to the effect that the grievance of the appellant about unilateral charging of interest/commission by the respondent- Bank was firmly denied or refused by the Senior Manager of the respondent-Bank vide letter dated 8.5.2002 and in particular letter dated 19.9.2002 and again by Advocates letter on 23.12.2003, giving rise to cause of action and accrual of right to sue.In cases governed by Article 113 of the 1963 Act, such as the present case, however, what is required to be noted is – when the right to sue accrues (and not when the right to sue first accrues).17. Similarly, in the case of Hardesh Ores (P) Ltd. vs. Hede and Company (2007) 5 SCC 614 ,  this Court upheld the order of rejection of plaint under Order VII Rule 11 of the CPC concerning a suit for injunction in reference to Article 58, which expressly postulates that time from which period begins to run is when the right to sue first accrues. The argument of the appellant therein to apply Article 113 of the 1963 Act has been noted in paragraph 33 and rejected. In that view of the matter, the exposition in this decision will be of no avail to the respondents.19. As regards Boota Mal (supra) and The East and West Steamship, Georgetown, Madras vs. S.K. Ramalingam Chettiar AIR 1960 SC 1058 , the Court was dealing with a case relating to Article 31 of the old Limitation Act, which provided that the time from which period begins to run, is when the goods sought to be delivered. Even these decisions will be of no avail to the fact situation of the present case, which is governed by Article 113 of the 1963 Act and for the reasons already recorded hereinbefore.20. Similarly, in S.S. Rathore (supra), the Court was dealing with a case governed by Article 58 of the 1963 Act, which specifically provides that time begins to run when the right to sue first accrues. In Ram Prakash Gupta (supra), the Court dealt with a case governed by Article 59 of the 1963 Act, which provides that the suit could be filed when the facts entitling the plaintiff to have the instrument or decree cancelled or set aside or the contract rescinded first become known to him. The Court opined that the knowledge mentioned in the concerned plaint could not be termed as inadequate and incomplete. The Court reversed the judgment of the Civil Judge and the High Court rejecting the plaint. This Court also noted that while deciding the application under Order VII Rule 11 of the CPC, few lines or passage from the plaint should not be read in isolation and the pleadings ought to be read as a whole to ascertain its true import. Even in that case, the trial Court and the High Court had failed to advert to the relevant averments, as stated in the plaint, which approach was disapproved by this Court. In the present case, as noticed earlier, the trial Court had failed to advert to and analyse the averments in the plaint, but selectively took notice of the assertion in the plaint in question that the appellant became aware about the discrepancies in July, 2000, and then proceeded to reject the plaint being barred by law of limitation having been filed in February, 2005.CIVIL APPEAL NO. 2515 OF 2020 (Arising out of SLP (C) No. 30210/2017)3. We have considered the factual position in the present case, which is similar to the facts in the companion appeal. Therefore, for the reasons stated in the judgment in companion appeal arising from SLP(C) No. 30209/2017, even this appeal should succeed on the same terms.