Kochu Veloo Pillai vs Karthiyayani Pillai and Others

S. Velu Pillai, J.—The plaintiff, now represented by the appellant who is impleaded as the additional second plaintiff, sued defendants 2 to 7, who are the widow and children of Patchan Pillai a deceased nephew of the plaintiff, for money alleged to be due to him. During his absence in Singapore for nearly seventeen years, the plaintiff made remittances to Patchan Pillai in India for various purposes, such as, the purchase of properties in his name, the disbursement of monies to his relations, the investment of funds in savings bank accounts and the purchase of a cow. The remittances were during the period which commenced on the 7th March, 1938, and ended on the 18th September, 1952; in all, he had remitted a sum of Rs. 4522/-. According to the plaintiff, they were not applied by Patchan Pillai according to directions and so the plaintiff sued defendants 2 to 7 to account for the same, out of the assets of Patchan Pillai. They contended, that except, for a sum of Rs. 600/- which was admitted to be a loan to the second defendant and which together with interest was deposited in court during the pendency of the suit for repayment the other amounts were paid to Patchan Pillai gratuitously and denied that they were to be applied for any specific purpose. The court found, that Patchan Pillai had not accounted for a sum of over Rs. 3300/-, but held the claim to be barred by limitation except to the extent of Rs. 1500/-. The court repelled the contention of the plaintiff, that Patchan Pillai received the amounts from the plaintiff on trust with in the meaning of Section 10 of the Limitation Act, finding however at the same time, that their relationship was as principal and agent. The suit was decreed for Rs. 1500 and interest, and this appeal relates to a sum of Rs. 1689.37p. additionally claimed, and to costs in the lower court which had not been decreed. The main question to consider in this appeal is, whether the suit is barred by limitation. On the facts and circumstances of the case as disclosed by the pleadings and by the evidence, there is good reason to hold, in agreement with the lower court, that Patchan Pillai was the agent of the plaintiff for carrying out the instructions, which, as found, accompanied the remittances made from time to time. The plaintiff apparently was making some saving in Singapore which he desired to apply in India, and so the services of Patchan Pillai were requisitioned. The case that the remittances were made gratuitously and for Patchan Pillai''s benefit, was rightly found against. As agent, Patchan Pillai was liable to account to the plaintiff for the due application of the amounts remitted. Section 10 of the Limitation Act having no application, on the finding as recorded, learned counsel relied on Article 89 of the Indian Limitation Act which is as follows:

Description of suit.

Period of limitation.

Time from which period begins to run

By a principal against his agent moveable property received by the latter and not accounted for

Three years

When the account is, during the continuance of the agency, demanded & refused or, where no such demand is made when the agency terminates.

On the plain language of the Article, it is not possible to hold, that the frame of the suit should be as for accounts generally. The Article contemplates a suit for recovery of moveable property received by the agent and not accounted for by him. A suit for accounts, as in a running account, may be within the Article, the term "moveable property" being comprehensive to include money. Thus a suit to call upon the agent to account for money entrusted with him, not necessarily a suit for accounts, is within the Article. It has been so held in Kashiram Vs. Santokhbai, . But it was contended, that the suit being against the legal representatives of Patchan Pillai, is not a suit against an agent within the meaning of Article 89. This raises a point as to the scope of the Article and though at one time the view was entertained that a suit against the legal representatives of an agent is not a suit contemplated by the Article, later cases have taken a different view. In Nobia Chandra Barua v Chandra Madhav Barua (A. I. R. 1916 P. C. 148) the Privy Council had held, that the term ''principal'' in Article 89, is wide enough to include his legal representatives and that a suit by them against an agent to account for moveable property is governed by this Article. By parity of reasoning, the term ''agent'' must also receive a similar construction. It is not open to doubt, that a suit instituted against an agent under Article 89 can be continued after his death against his legal representatives. The liability of the legal representatives of an agent is no doubt conditioned by the possession by them of properties and assets of the agent. It may also be, that a different standard as to burden of proof may apply, in judging their liability as distinguished from the liability of the agent, the burden being on the principal to prove as against the legal representatives, that realisations have been made by the agent on behalf of the principal, and the extent of such realisations. These distinctions as regards the extent or character of their liability and the onus of proof, cannot affect the nature or the substance of the cause of action which is the same against them as against the agent. Sufficient reasons have been adduced, if I may say so, by a division bench of the Punjab High Court in Jagir Singh $ Dheru (A. I. R. 1958 Pun 487) in support of the view, that Article 89 applies to a suit against the legal representatives of the agent. The preponderance of judicial opinion is also in favour of holding, that Article 89 applies to such suits. Decisions to the contrary have been explained or distinguished in the case cited. Bikram Kishore Manikya Bahadur Vs. Jadab Chandra Choudhury and Others, decided by the Calcutta High Court and Sree Rajah Parthasaradhi Appa Rao v Subba Rao ( A. I. R. 1927 Mad 157) decided by the Madras High Court are two other cases in point. Learned counsel relied on Article 62 of the Indian Limitation Act, but I consider that Article 89, dealing with principal and agent, is the specific Article and has to be applied.

Under column 3 of Article 89, time has to be computed from the date on which account is demanded and refused or where no such demand is made, when the agency terminates. According to the plaintiff, the only demand was by notice of suit shortly before its institution and it was well within the period of three years and according to the defendants, there was no demand whatever and no refusal, because the remittances were made gratuitously and for Patchan Pillai''s benefit, a case which has been found against by the lower court and which was not and could not be canvassed in this court, in view of the overwhelming evidence to the contrary. u/s 201 of the Indian Contract Act an agency is terminated by the principal revoking his authority; or by the agent renouncing the business of the agency; or by the business of the agency being completed; or by either the principal or agent dying...". In this case, the business of the agency, was not completed, according to either party, because according to the defendants, the payments were not received for any specified purpose, and according to the plaintiff, they were not applied for the purpose of the agency and for that reason AIR 1928 833 (Lahore) is distinguishable. So the agency terminated only on Patchan Pillai''s death, which took place on the 4th November, 1952, and the suit instituted within three years of that date was within time. It follows as a result, that in addition to the decree for Rs. 1,500/- and interest passed by the lower court, the plaintiff shall take a decree for Rs. 1689.37p. and interest thereon from the date of suit at 4% per annum to be realised from the assets of Patchan Pillai. The plaintiff shall realise his costs of the suit in the lower court from the contesting defendants, proportionate to his success; for this purpose, the plaintiff shall be deemed to have succeeded to the extent of Rs. 1500 - 1689 or Rs. 3189. The plaintiff shall realise the costs of this appeal from the contesting respondents, one set only in both courts. The appeal is allowed.