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Judgment
Satyanarayana Rao, J.—This is an appeal by the official liquidator, the Union Bank, Malabar, Limited, against the order of the learned
District Judge, South Malabar, dismissing an application u/s 235 of the Indian Companies Act in limine on the ground that it was barred by
limitation. The application was against the managing director of the Union Bank, Malabar, Limited, its Secretary and also the auditor who was
appointed by the general body at the annual general meeting. The official liquidator was appointed on 20th June 1939, and the application was
taken out u/s 235 of the Indian Companies Act on 20th June 1942. 19th June 1942 was a Sunday. The learned District Judge of South Malabar,
without going into the merits of the application, dismissed the application on the ground that it was beyond three years, the period prescribed by
Section 235 of the Act.
The short point, therefore, for consideration in this appeal is whether the view taken by the learned District Judge is correct. Section 235 of the
Indian Companies Act was amended in 1936 by Act XXII of 1936, by which, a period for filing an application under the statute was prescribed.
The portion of the section which is relevant for the purpose of this discussion is:
...the Court may, on the application of the liquidator, or of any creditor or contributory made within three years from the date of the first
appointment of a liquidator in the winding up or of the misapplication, retainer, misfeasance or breach of trust, as the case may be, whichever is
longer, etc....
The Appellant''s Counsel relies upon Sections 9 and 10 of the General Clauses Act and contends that the first day, i.e., the day on which the
liquidator was appointed, should be excluded u/s 9 of the General Clauses Act, and that, as the Court was closed on 19th June 1942, the
application filed on the next day is within time u/s 10 of the General Clauses Act, even if he was not entitled to invoke Section 9 of the General
Clauses Act. We think, that the contention of the learned Advocate for the Appellant based on both the sections is correct. Section 9 of the
General Clauses Act provides:
In any (Central Act) or Regulation made after the commencement of this Act, it shall be sufficient, for the purpose of excluding the first in a series
of days or any other period of time, to use the word ''from'', and for the purpose of including the last in a series of days or any other period of time,
to use the word ''to''.
An application u/s 235, it is no doubt true, has to be made within three years from the date of the first appointment of the liquidator. But, in
computing the period of three years, as the word ""from"" is used in the Act, it is contended that the first day should be excluded from computation.
The learned District Judge, thought that, as the word ""within"" was used besides the word ""from"" there was no scope for there application of
Section 9 of the General Clauses Act. We do not share that view. The word ""within"" was used to denote the period during which action had to be
taken by the liquidator by making an application under the section. But, in order to determine the period, one has to compute it beginning with the
day on which the liquidator was first appointed. u/s 9 of the General Clauses Act, as the word ""from"" is used in Section 235 of the Indian
Companies Act, the first day should ordinarily be excluded. Section 9 of the General Clauses Act gives statutory recognition to the well-
established principle applicable to the construction of Statutes that ordinarily, in computing time, the rule observed is to exclude the first and include
the last: vide Radcliffe v. Bartholomew (1892) 1 Q.B. 161 and the passage in Halsbury''s Laws of England (Second edition), page 138. It was,
however, argued on behalf of the Respondents that Section 9 applies only where both the words ""from"" and ""to"" occur in a Statute and not
otherwise. This construction implies that the word ""and"" used in Section 9 is not used disjunctively but conjunctively; but, on a plain reading of the
section, it is obvious that the word is used only disjunctively to indicate two things, namely, if the first day has to be excluded it is sufficient to use
the word ""from"" and if the last day is to be included the word to be used is ""to"". It was also urged on behalf of the Respondents that the word
first"" in Section 9 of the General Clauses Act before ""in a series of days"" no doubt implies the first day, but the same cannot be applied to any
other period of time occurring in the section, his contention being that ""any other period of time"" means the first unit in ""any other period of time"". In
other words, when a three years'' period is mentioned the first unit is the first year and therefore it was contended that it would lead to absurd
results. We think, however, that no such catastrophe is implied in the language of the section, and taking the two parts of the section together, ""the
first in a series of days"" would mean ""the first day in a series of days"" and the same would qualify ""any other period of time"" i.e., ""the first day in any
other period."" In the same manner, ""the last in a series of days"" would also apply to ""any other period of time"" occurring in the latter half of the
section. In both the contexts, the first day and the last day are to be taken as applicable not only to the ""series of days"" but also to ""any other
period of time"" referred to in the section. Though there is no direct case interpreting the section, our attention was drawn to the decisions in which
the principle of Section 9 was applied, where the period fixed was by an order or decree of Court: vide Ramchandra Govind Unavne Vs. Laxman
Savleram Ronghe, , AIR 1935 291 (Lahore) and Marakanda Sahu Vs. Lal Sadananda Singh, . In the Bombay case, the learned Judge referred to
the language of Section 9 and placed an interpretation upon it which, we think, is correct, though it was not necessary for the decision of the case.
If the principle could be applied independently of the Statute, we see no reason to vary it in a case where the language of the section exactly
applies. In our opinion, therefore, both on principle and also on the clear language of the section, the Appellant is entitled to exclude the first day
from the computation of the period of three years. In this view, the application is in time.
But, as learned Counsel on both sides argued the case also u/s 10 of the General Clauses Act, we think it would be proper to express our view
on that question also. Section 10 of the General Clauses Act provides:
Where, by any (Central Act) or Regulation made after the commencement of this Act, any act or proceeding is directed or allowed to be done or
taken in any Court or office on a certain day or within a prescribed period, then, if the Court or office is closed on that day or the last day of the
prescribed period, the act or proceeding shall be considered as done or taken in due time if it is done or taken on the next day afterwards on
which the Court or office is open:
In the present case, an application is allowed to be filed by Section 235 of the Indian Companies Act and it should be filed within three years
from the date of the first appointment of the liquidator. If the last day in that period of three years was a Sunday and the Court was closed, and if
the application was filed on the next day, it would, under the section, satisfy the requirement of the law and no question of the application having
been filed beyond the period prescribed could arise. Mr. Bashyam, the learned Counsel for the Respondents however, argued, relying on a Full
Bench decision of this Court in Chenchuramana v. Arunachalam ILR (1935) Mad. 794 (F.B.), that the period of three years prescribed by Section
235 must be treated as a condition precedent in the same manner as provided by Section 9 of the Provincial Insolvency Act. We are, however, of
the opinion that the two sections, i.e., Section 9 of the Provincial Insolvency Act and Section 235 of the Indian Companies Act are not in pari
materia. u/s 9(1)(c) of the Provincial Insolvency Act, the act of insolvency on which the petition is founded must have occurred within three months
before the presentation of the petition. It is obviously not a period prescribed for filing the petition, as no period has been prescribed under the law
for presenting a petition u/s 9. All that the Statute requires is that the act of insolvency must have occurred within three months before presentation
of the petition. The proceeding initiated in a Court is the filing of the petition and no step in Court is contemplated with reference to the act of
insolvency and, therefore, Section 10 of the General Clauses Act would not apply. It was therefore held in the Full Bench decision in
Chenchuramana v. Arunachalam ILR (1935) Mad. 794 (F.B.) that the existence of an act of insolvency, within three months before is a condition
precedent for the filing of the petition, and, if the petition was filed on the re-opening date of the Court, and if the three months'' period had expired
during the vacation, the act of insolvency would no longer be available to the petitioning creditor and therefore, the petition would not be
maintainable. Since the decision in Chenchuramana v. Arunachalam ILR (1935) Mad. 794 (F.B.) the Legislature intervened and added a proviso
to Section 9 of the Provincial Insolvency Act by Act III of 1950, which obviates the difficulty felt by the learned Judges in Chenchuramana v.
Arunachalam ILR (1935) Mad. 794 (F.B.). It provides:
Provided that where the said period of three months referred to in Clause (c) expires on a day when the Court is closed, the Insolvency petition
may be presented on the day on which the Court re-opens.
In the present case, there is no question of any antecedent requirement within the particular period of time to be fulfilled to enable the liquidator
to maintain the petition u/s 235. All that he is required to do is to initiate proceedings within a period of three years which have to be computed
from the date of the first appointment of the liquidator, and if it happens that the last day in the prescribed period is a day on which the Court is
closed, the liquidator is entitled to file an application the next day. The principle underlying Section 10 is also a principle recognised, apart from the
Statute, in this High Court and in other Courts: vide Sambasiva Chari v. Ramasami Reddi ILR (1898) Mad. 179 and also Ratnaswami Padayachi
and Others Vs. Kuppuswami Ayyar and Others, .
Our attention was drawn to the decision of Clark, J., in Official Liquidator v. Krishnaswami Iyengar (1947) I M.L.J. 234 where the learned
Judge had to consider the question, whether the period of limitation prescribed in Section 235 of the Indian Companies Act could be cut down by
treating the application as a suit and applying the period of limitation prescribed for such suits by the Limitation Act. The learned Judge decided
that the period of limitation prescribed u/s 235 prevails over the period prescribed by the Limitation Act for similar suits. The decision proceeded
on the assumption that the period prescribed in Section 235 is a period of limitation, and the learned Judge was not called upon to discuss the
question, whether the requirements of Section 235 constituted a condition precedent on the analogy of the Provincial Insolvency Act which was
interpreted in the decision in Chenchuramana v. Arunachalam ILR (1935) Mad. 794 (F.B.). To a similar effect is the decision in Official
Liquidators of the Benares Bank, Limited v. Sri Prakasha ILR (1946) All. 461. We, therefore, think that the Petitioner is entitled also to rely on
Section 10 of the General Clauses Act and that the application is not barred u/s 235 even, from this point of view.
The result is that the appeal must be allowed, the order of the learned District Judge set aside and the application remanded to the lower Court
for disposal according to law. Costs of these proceedings will abide the result.