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Judgment
A.K. Sikri, J.—Admit.
This appeal is directed against Judgment and decree dated 18th January, 1999 passed by Shri Ved Prakash Vaish, Additional District Judge, Delhi dismissing the appellant/plaintiff''s Suit for recovery of Rs 177048.58 p holding it to be barred by limitation. Learned counsel for the parties urged that as the trial court record has been and the point involved is short, the appeal be finally heard. Accordingly by this judgment the appeal is being disposed of.
Facts giving rise to this appeal briefly are : that the appellant (plaintiff) filed a suit against the respondents (defendants) for recovery of Rs. 1,77,048.58p with costs and interest @18% per annum from the date of filing of the suit till the date of realisation alleging therein that the defendant No. 2 is the sole proprietor of defendant No. 1, M/s. National Steels; that defendants had been purchasing iron steel goods from the plaintiff''s firm and had been making part payments from time to time; as per the books of account kept by the plaintiff, a sum of Rs. 4,89,178.65p was due and outstanding against the defendants; vide their letter dated 7th January, 1994 defendants informed the plaintiff''s firm that they had verified the statement of account sent by the plaintiff''s firm to them for the period from 1st April, 1993 to 18th December, 1993 and it showed an excess debit balance of Rs. 23,842.73p . During the year 1994 the defendants also made purchases on credit and made part payments after giving adjustment of all the payments received from the defendants a sum of Rs. 1,14,252.33p was found due and outstanding against the defendants. It was pleaded that the cause of action had accrued to the plaintiff firstly on 18th March, 1995 when the defendants made the last payment of Rs. 1,00,000/- to the plaintiff vide cheque No. 062578 dated 11th March, 1995 drawn on Union Bank of India, Karol Bagh, New Delhi in favor of the plaintiff''s firm and, thereafter on various dates when the plaintiff had demanded the dues from the defendants and the same were not paid. The cause of action lastly arose on 14th March, 1998 when the defendants refused to make payment to the plaintiff.
After service of summons respondent appeared and filed written statement, inter alia, raising a preliminary objection that the suit was barred by limitation and was liable to be dismissed on this short ground. It was pleaded that the defendant had delivered the cheque no. 062578 dated 11th March, 1995 to the plaintiff at his residence on 11th March, 1995 Material allegations in the plaint were also denied. However, averments made in the plaint that the courts were closed from 13th to 15th March, 1998 were not denied. In the replication to the written statement plaintiffs reiterated the submissions made in the plaint asserting that the cheque No. 062878 dated 11th March, 1995 was delivered to the plaintiff on 18th March, 1995 and thereafter the cheque was lodged in the Punjab National Bank for collection.
It may mentioned here that the plaintiff, out of abundant caution, also filled an application for condensation of delay u/s 5 of the Limitation Act, 1963 along with the suit stating that he was confined to bed from 8th March, 1998 to 15th March, 1998 and that immediately on reopening of the courts the suit was filed on 16th March, 1998.
On the basis the pleadings trial court framed the following preliminary issue :-
Whether the suit is within the period of limitation? OPP
Trial court further felt that the issue was purely legal and did not require any evidence. Arguments were heard on the preliminary issue. By the impugned judgment it was held that the suit was barred by limitation and the same was dismissed.
We have heard learned counsel for the parties and been taken through record. Learned counsel for the appellant argued that the trial court completely misread and misconstrued the material on record. It was argued that the trial court has wrongly applied the law laid down by the Supreme Court in Jiwanlal Achariya Vs. Rameshwarlal Agarwalla, . Learned counsel for the defendant argued to the contrary.
In order to appreciate the rival contentions paragraphs 15 of the plaint and also the reply of the respondent in the written statement of this para are reproduced hereinbelow :-
PARA 15 of the Plaint
"That although the cheque was delivered by the defendant No. 2 at the business premises of the plaintiff on 18.3.1995 the same had been encased by the Bankers of the defendant on 19.3.95 at Karol Bagh, New Delhi, yet with a view to avoid any Technical Objection on the part of the defendants, an application for the condensation of Delay, if any, occasioned in filing the present suit may kindly be read as part of this plaint, which is filed with the suit forthwith. The delay, Therefore, may kindly be condoned and the suit be treated to have been filed within the limitation period."
PARA 15 of the Written Statement
"In reply to the para 15 of the plaint it is denied; that the cheque was delivered by Defendant No. 2 at the business premises of the plaintiff on 18.03.1995. The said cheque was delivered on 11.03.1995 at the residence of the plaintiff as he was in the need of the money. The alleged application is not maintainable under the law as the section 5 of the Limitation Act does not apply to the suits filed beyond the period of limitation. It applies only to filling of various miscellaneous applications. The delay in filing the present suit can not be condoned in view of the settled legal position and the suit as well as application merit dismissal.
Perusal of the averments made in the pleadings clearly reveal that the case of the appellant before the trial court was that cheque in question was delivered on 18th March, 1995 which was the starting point for the purposes of limitation, i.e. the date of delivery of the cheque, that on 19h March, 1995 the cheque was sent for collection by the plaintiff. However , the case of the defendant was that the cheque in fact was dated 11th March, 1995 and was delivered on that day itself but there was no specific denial to the fact that the cheque in question was sent for collection after 18th March, 1995.
In our considered view the trial court appears to have misread and misapplied the law laid down by the Supreme Court in Jeewan Lal''s case (supra), which was a case of a post dated cheque. Supreme Court in that case held mere delivery of a cheque on a particular date does not mean that the payment was made on that date unless the cheque was accepted as unconditional payment. It was further observed that when the cheque is not accepted as an unconditional payment it can only be treated as a conditional payment. It was observed :-
"Thus if in the present case the cheque which was handed over on 4th February, 1954 bore the date February 4, 1954 and was honoured when presented to the bank the payment must be held to have been made on February 4, 1954, namely, the date which the cheque bore.
But if the cheque is post dated as in the present case it is obvious that it could be paid till February 25, 1954 which was the date it bore. As the payment was conditional it would only be good when the cheque is presented on the date it bears, namely, February 25, 1954 and is honoured. The earliest date, Therefore, on which the respondent could have realised the cheque which he had received as conditional payment on February 4, 1954 was the 25th February, 1954 if he had presented it on that date and it had been honoured.
The fact that he presented it later and was then paid is immaterial for it is the earliest date on which the payment could be made that would be date where the conditional acceptance of a post dated cheque becomes actual payment when honoured."
The Supreme Court, while making the above observations made reference to its earlier decision, in The Commissioner of Income Tax, Bombay South, Bombay Vs. Ogale Glass Works Ltd., Ogale Wadi, and observed that decision of this court does not support the proposition that even where the acceptance of a post dated cheque is conditional, the date on which the payment is made is the date of acceptance of the post dated cheque provided it is honoured."
In the present case the averments made in the plaint, clearly reveal that it is not a case of delivery of a post dated cheque. It is a case of delivery of an antedated cheque.
In Commissioner of Income Tax''s case (supra), Supreme Court had observed that a sum of money may be received in more ways than one cannot be doubted. It may be received by transfer of coins or currency notes or a negotiable instrument which represents and produces cash and is treated as such in business. It was also observed that in the absence of any agreement, express or implied to the contrary, a payment by a negotiable instrument is always understood to be conditional, It was observed :-
"When it is said that a payment by negotiable instrument is a conditional payment what is meant is that such payment is subject to a condition subsequent that if the negotiable instrument is dishonoured on presentation the creditor may consider it as waste paper and resort to his original demand.
A cheque unless dishonoured, is payment. The payment takes effect from the delivery of the cheque but is defeated by the happening of the condition i.e., nonpayment at maturity.(Emphasis Supplied)
It is not difficult to imagine that sometimes a debtor may approach the creditor offering him payment of the debts due by presenting an ante dated cheque and informing the creditor that the same was lying ready and that he could not deliver the same earlier. In such a case date on which the cheque is delivered to the creditor would be the date from which the limitation would start u/s 19 of the Limitation Act, 1963 for the simple reason that before the cheque is actually delivered by the debtor to the creditor, the debtor cannot be said to have made the payment, nor the creditor can be said to have accepted such payment. However, in case of the postdated cheque the date of delivery is totally irrelevant because the cheque cannot be presented for encashment till date mentioned on the cheque is reached.
On the same logic, if a cheque bears a date prior to the date of the delivery of cheque the creditor can present the same for collection only after it is delivered to him. In such a case it is the date of delivery of the cheque rather than the date which the cheque bore, would be the date for computing the period of limitation.
In Jeewan Lal''s case (supra) the Supreme Court has observed :
"But there can in our opinion no doubt that where a post dated cheque is accepted conditionally and it is honoured, the payment for purposes of Section 20 (now section 19) can only be the date which the cheque bears and cannot be on the date the cheque is handed over, for cheque being post dated, can never be paid till the date on the cheque."
We are of the considered view that the question whether the cheque was delivered on 18th March, 1995, as claimed by the plaintiff, or was delivered on 11th March, 1995, as claimed by the defendant, is a question of fact, and the plaintiff could not be nonsuited without trial.
Regarding the other point as to whether an application for condensation of delay in filing the suit was maintainable, we would like to observe that there is no provision in the Limitation Act, 1963 (for short the Act) for condensation of delay in filing the suits. Section 3 of the Act provides :-
Bar of limitation - (1) Subject to the provisions contained in Sections 4 to 24 (inclusive), every suit instituted, appeal preferred, and application made after the prescribed period shall be dismissed although limitation has not been set up as a defense.
(2) For the purposes of this Act.
(a) a suit is instituted -
(i)......
(ii)......
(iii)......
(b) any claim by way of a set off, or a counter claim, shall be treated as a separate suit and shall be deemed to have been instituted -
(i)..........
(ii).........
(c) an application by notice of motion in a High Court is made when the application is presented to the proper officer of that court.
Mere reading of Section 3 of the Act shows that it is mandatory and absolute in nature. It enjoins upon the courts to dismiss any suit instituted, appeal preferred application made, after the prescribed period of limitation, although limitation has not been set up as a defense. Courts have no discretion or inherent powers to condone the delay if the suit is filed beyond the prescribed period of limitation. Rather a duty is cast on the court to dismiss the suit appeal or application, if the same is barred by limitation, unless the matter is covered by sections 4 to 24 of the Act.
At this stage it would also be relevant to refer to section 5 of the Act which reads as under :-
"5. Extension of prescribed period in certain cases - Any appeal or any application, other than an application under any of the provisions of Order XXI of the Code of Civil Procedure, 1908 may be admitted after the prescribed period of the appellant or the applicant satisfies the court that he had sufficient cause for not preferring the appeal or making the application within such period."
Reading of Section 5 of the Act itself reveals that it does not apply to the suits. It applies only to the appeals or applications except an application under Order XXI of the Code of Civil Procedure, 1908. The court cannot grant exemption from limitation even on equitable considerations or hardships. Section 5 of the Act though worded in very wide terms is not applicable to the suits, even if it is assumed that the plaintiff was really incapacitated for any reason, benefit of Section 5 of the Act cannot be availed.
For the foregoing reasons appeal is allowed, findings of the trial court on the preliminary issue are set aside. Consequently, the judgment and decree dated 18.1.99 passed by the trial court is also set aside. Suit is remanded back with the directions to proceed with the trial of the suit in accordance with law. Trial court will also decide the issue of limitation afresh, after allowing the parties to lead evidence as the suit has been remanded for trial. The appellant will be entitled for the refund of the court fee on memorandum of appeal for which requisite certificate will be issued in favor of the appellant by the Registry.
Parties to appear before the trial court on 21st March, 2000.
The facts are not in dispute. Controversy revolves around in a narrow compass. To appreciate the same, let us scan through the first:
Petitioner as well as Respondent No. 3 are working as Assistant Engineer (Civil) with Respondent No.1, Municipal Corporation of Delhi (MCD). Petitioner is, however, a diploma holder whereas respondent No. 3 is a degreeholder. Petitioner is senior to respondent No. 3. Both are aspiring for promotion to the post of Executive Engineer. Five years service as degreeholder and 10 years service as diploma holder is required.
It is a matter of record that MCD has not been calling the regular procedure for promotion to the post of Executive Engineer for quite some time and giving ad hoc promotions. Non-action on the part of MCD in filling up of the post of Executive Engineer on regular basis has come up for discussion before this Court in some cases earlier as well. The leading case being Kapoor Chand Vs. M.C.D.& Ors. CWP. No. 4598/95. Certain applications were filed in this petition and direction given from time to time. It is not necessary to refer various interim orders passed. Our purpose would be served in referring to orders dated 11.9.96 and 17.4.98. Order dated 11.9.96 was passed on the application moved by MCD seeking clarification/modification of earlier order dated 22.5.96 as there appears to be some conflict in the interim order passed in three matters pending before the Court. After discussing the matter at length, inter alia, following observations were made: "In our opinion the Rules read along with the relevant DPC instructions leave, no manner of doubt in holding that the list of eligible candidate has to be prepared year wise the crucial cut off date for determining eligibility has to be 1st October of the year, as admittedly in the MCD, the ACRs are written financial yearwise. We are also of the opinion that the original seniority cannot be disturbed. It has to be retained. there from eligible candidates have to be picked up and ineligible candidates excluded so as to prepare a list of eligible candidates. What has to be seen is eligibility or ineligibility as on 1st October of the year. Any one eligible on that day, if falling within the zone of consideration, is entitled to have his name forwarded to the UPSC. The list of the eligible candidates has to confirm to the seniority in the cadre. There is no question of the order of seniority being altered by reference to date of acquisition of the eligibility". 4. However, even after passing the order dated 11.9.96, still some doubts persisted and applications were filed for clarification of order dated 11.9.96 also. On these applications order dated 17.4.98 was passed wherein it was observed that the post should not be kept vacant for wrong and steps be taken to fill up the post on regular basis. It was also noticed that without fulfilling the post on regular basis, ad hoc current charge appointments are made which continue for a length of time thereby resulting in denying regular promotions and placing favorites on such key posts. After considering the submissions of all the parties and relevant instructions on ad hoc promotions issued by the Government, the Court passed the following clarification and further directions in continuation of order dated 11.9.96:
"(i) The order dated 11.9.96 applies to regular appointments to the post of Executive Engineer (Civil) to be made during the pendency of the petition. In so far as ad hoc\\current charge appointments are concerned, it would not be necessary to hold and convene the DPC.
(ii) Such ad hoc\\current charge appointment\\promotions shall be limited to a period of one year only and shall automatically cease on the expiry of the term appointed or one year from the date of appointment whichever be earlier.
(iii) Rule of seniority-cum-fitness shall be followed;
(iv) Such appointments\\promotions shall not be continued or renewed as a camouflage on regular appointments .
(v) MCD would observe the Government instructions regarding initiation of regular appointment\\promotions at least four months prior to anticipated vacancies.
(vi) Intimation shall be given to UPSC of all such appointments\\promotions".
The MCD on the basis of the aforesaid direction issued Circular letter dated 20.7.98 incorporating the aforesaid direction which included that Rule of Seniority-cum-fitness shall be followed while making any ad hoc arrangements.
Reverting to the facts of this case, it may be stated that eligibility list is prepared each year for promotion to the post of Executive Engineer-Petitioner completed 10 years of service as Assistant Engineer on 18.8.99 and become eligible for promotion w.e.f. 1-10-99 in the year 1999-2000 under the Recruitment Rules. Respondent No. 3 who is a degree-holder although junior to the petitioner completed 5 years of service as Assistant Engineer and became eligible for promotion on 1.10.95 i.e. in the year 1995-96, 1996-97, 1997-98 and 1998-99, thus for the years 1995 to 1999 respondent No. 3 was eligible for the post of Executive Engineer, petitioner was not eligible. However, when the ad hoc appointments were made during this period, respondent No.3 could not be promoted as he was facing disciplinary action due to which his name could not be considered for promotion whereas his juniors were granted promotion. Some punishment was also imposed upon respondent No. 3 which continued till 1999. Two vigilance cases pending against him were finalised in April, 1999 and third case was finalised by imposing a minor penalty of warning on 29.9.99. Thus till September, 1999 due to the pendency of the aforesaid cases, he could not be promoted even on ad hoc basis. For the year 1999 and 2000 petitioner also became eligible and in the eligibility list of 1999-2000 petitioner would admittedly rank above respondent No. 3 as he is senior to respondent No. 3. On 12.1.2000 an Office Order was passed promoting respondent No. 3 to the post of Executive Engineer on ad hoc basis for a period of one year or till such time the post is filled up on regular basis whichever is earlier. Aggrieved against this order petitioner has filed this present petition and his contention is that he being senior to the respondent No. 3 should have been given ad hoc promotion as per the directions of Division Bench contained in the order dated 17.4.98 quoted above which were circulated by the respondents in their Circular dated 20.7.98.
The position which emerges from the aforesaid facts is as under :
Petitioner is senior to respondent No. 3 in the seniority list . Respondent No. 3, however, being degreeholder completed 5 years of service in 1995 and became eligible for promotion as on 1.10.95. He could not be promoted to the post of Executive Engineer on ad hoc basis till 1999 as he was facing disciplinary action. In 1999-2000 petitioner also becomes eligible and in the eligibility list for 1999-2000 petitioner ranks above respondent No. 3. At this juncture when the ad hoc promotion is made whether it is petitioner who is to be treated as senior to respondent No. 3 or it is respondent No. 3 who is to be treated as senior as he became eligible earlier than the petitioner. On determination of this question the fate of this case hinges.
Setting highest standards of professional ethics, Mr. Rakesh Dwivedi, learned senior counsel appearing for respondent No. 3 cited the recent judgment of Hon''ble Supreme Court in the case of R.B. Desai and Another Vs. S.K. Khanolker and Others, which conclusively determines the aforesaid question posed in this case and answers the question against respondent No. 3. In that case the Court held as under :
"If on the date of consideration, the appellants did not have the eligibility then certainly it is the first respondent who ought to have been considered for the said promotion and if he was so promoted earlier than the appellants he would have acquired a higher ranking in the seniority list of ACF''s. That not being the case, we are unable to agree with the view taken by the High Court, as stated above, because on the date on which the avenue for promotion to the cadre of ACF''s opened both the appellants as well as the first respondent had the necessary eligibility and their names figured in the eligibility list. That being so, as stated above, it is the appellants whose case ought to have been considered first and it was so done and they having been found otherwise suitable, they were rightly promoted earlier than the first respondent. Consequently, they are entitled to a higher ranking in the cadre of ACF''s vis-a-vis the first respondent. The view taken by us also finds support from the judgment of this Court in Union of India Vs. B.Jayaraman wherein considering a similar argument this Court held: (SCC Headnote)
"The note in column 11 is only for purposes of giving eligibility to the erstwhile Assistants working as Superintendents Grade II for purposes of being considered for promotion to the post of Superintendent Grade I and not for the purpose of seniority at all."
with which view we respectfully agree."
I may state here that Full Bench of Punjab & Haryana High Court in the case entitled Punjab State Electricity Board, Patiala and another Vs. Ashok Kumar Sehgal and others, had taken contrary view and appeal filed against that judgment was also dismissed by Supreme Court vide order dated September 14, 1994. This was a decision rendered by two Judges of Supreme Court which it appears was not brought to the notice of the Court while deciding the case of R.B. Desai (Supra). It was fairly conceded by Mr. Dwivedi that since R.B. Desai case is a judgment rendered by three Judges and also later in point of time, it is this decision which binds this Court. Following the ratio of R.B. Desai (Supra), it is clear that even if respondent No.3 acquired eligibility prior to the petitioner, facts remains that he could not get promotion all these year due to pendency of disciplinary case pending against him. In the year 1999-2000 when both petitioner and respondent No. 3 are eligible, petitioner because of his seniority would rank above respondent No. 3 in the eligibility list and would have preferential claim over the respondent No. 3.
The post of Executive Engineer is a selection post. Regular appointments are not made. By the impugned order respondent No. 3 is promoted to this post on ad hoc basis for a period of one year. As per the directions dated 17.4.98 contained in the case of Kapoor Chand (Supra) while making ad hoc promotions, Rule of Seniority-cum-fitness follow. Petitioner being senior to respondent No. 3 could not have been ignored and respondent No. 3 given preference.
In the counter affidavit filed by the MCD, the MCD has justified the impugned promotion order on the ground that although respondent No. 3 became eligible for promotion on 1.10.95 he could not be promoted till 1999 because of pendency of disciplinary cases against him and when he became free from any currency of punishment, his case was considered for promotion "as a left out case." This course of action adopted by the MCD is clearly erroneous and against the ratio of Supreme Court in the case of R.B. Desai case. The respondent No. 3 could not get promotion from 1995 till 1999 because of disciplinary cases pending against him. This was valid ground for not promoting him at that time. Therefore, he becomes eligible for promotion only as on 1.10.99 after the disciplinary cases pending against him were concluded. However, as on that date petitioner also becomes eligible and petitioner being senior to respondent No. 3 has a prior claim, when for ad hoc promotion seniority-cum-fitness is the consideration. By treating "as a left out case" MCD is giving weightage to the fact that respondent No. 3 became eligible for promotion prior to the petitioner and, Therefore, is to be given preference which cannot be done in view of the decision of the Supreme Court in the aforesaid judgment of R.B. Desai (supra).
This petition, accordingly, succeeds. Rule is made absolute. Impugned order dated 12.1.2000 is hereby setaside. Respondents are directed to make ad hoc promotion keeping in view the ratio laid down in the case of R.B. Desai (Supra) and the direction dated 17.4.98 passed by Division Bench of this Court in Kapoor Chand case. If the petitioner is senior most and is otherwise fit for promotion, he should be considered for promotion, on ad hoc basis in preference to respondent No. 3.
No orders as to costs.