P (PLP)

M. R. KAYANI. J.‑The Municipal Committee of Sheikhupura made a demand for house‑tax from the Executive Engineer (Canals) of the Upper Chanab Circle for the period 1st July 1922 to 31st March 1938, whereupon, after some correspondence, the Executive Engineer moved Government and a suit was filed by the Govern ment for a declaration that the demand in question was barred by time and for the issue of an injunction that the Municipal Committee of. Sheikhupura be restrained from taking any steps for the realisation of the tax in question. The machinery by which a committee realises arrears of taxes is provided by section 81 of the Punjab Municipal Act which is as follows :‑‑-- 81 (1) " Any arears of any tax, water rate rent, fee or any other money claimable by a committee under this Act may be recovered on application to a Magistrate having jurisdiction within the limits of the municipality, or in any other place where the person 'from whom the money is claimable may for the time being be resident by the distress and .sale' of any movable property within the limits of his jurisdiction belonging to such person." The question involved was whether an application of this sort is governed by the limitation of three years prescribed by Article 181 of the Limitation Act which admittedly is the only article that can be applied. That article provides limitation for applications for which no period of limitation is provided else where in this schedule or by section 48 of the Code of Civil Pro cedure, 1908 ". The learned Subordinate judge who tried the suit was of the opinion 'that this article did not apply, firstly, because the Magistrate acting under section 81 of the Punjab Municipal Act did so in his administrative or ministerial capacity and not as a Court; still less as a Civil Court ; secondly, because section 84 of the same Act provided a remedy by an appeal to the Collector. The suit having been dismissed, the plaintiff appealed to the learned Senior Sub‑Judge of Sheikhupura who held that the article in question was applicable inasmuch as the term " Court " as defined in section 3 of the‑ Evidence Act includes all judge‑, and Magistrates and further, that the order to ‑‑be passed by a Magistrate under section 81 of the Municipal Act was not a mere ministerial order because it was 'open to revision by the High Court. He rightly repelled the contention of the learned Sub‑Judge that section 84 of the Municipal Act provided a remedy by way of appeal froth an order of the magistrate under section 81, for section 84 provides for an appeal only against the assessment or levy of any tax ov against the refusal to refund any tax. In the view that he took, the suit of the Government was decreed and 'it is from this decree that the Municipal Committee has brought this second appeal. It was in the first instance contended by the appellant's counsel that Article 181 applied only to applications under the Code of Civil Procedure and not to an application under any other Act. Reliance was placed for this view on Hansraj and others v. Official Liquidators of Dehra Dun, etc,, Company (I. L. R. 54 All. 1067) where the question was whether an applica tion made by the liquidator was within time and it was argued that the application was barred by Article

181. It was observed by their Lordships of the. Privy Council that in the first place a series of Authorities commencing with 7 Bombay 213 had taken the view that Article 181 related only to applications under the Code of Civil Procedure and that, secondly, even if Article 181 did apply to an application under the Indian Companies Act, the application before them was still within time. This, as was observed by Beckett J., in Mian Abdul Aziz v. Punjab Govern ment (A. I. R. 1942 Lah. 186), was not a final settlement of the question, for the finding was in the alternative. Further, it must be observed that the amendment of the Limitation Act by Act X of 19‑10 has made that view obsolete, for Article 158 and Article 178 which, like Article 181, also fall in the third division, relate to applications under the Arbitration, Act, so that the argument that the third division consists entirely of applications where either the Code of Civil Procedure has been specifically mentioned or to which, by their very nature, the provisions of the Code must necessarily apply no longer holds water. This " series of authorities " to which the Privy Council judgment referred have been mentioned in Sheikh Kaudu v. Berar Ginning Co. Ltd. (A. I. R. 1928 Nagpur 194) where an application was made under section 166 .of the Companies Act for the winding up of a company. With the altered complexion that the third division of the first schedule of the Limitation Act has taken since its amendment in 1940, it is necessary to refer to the reasons adopted by the learned judges in 1928 Lah. 194 for dis senting from the previous view, except that the reference to section 29 of the Act, if I may say so with great respect, was very perti nent. That section provides that where any special or local law prescribes for any suit, appeal or application a period of limitation different from the period prescribed therefore by the first schedule, the provisions of section 3 shall apply as if such period were pres cribed therefore in that schedule. Their Lordships, referring to this provision, observed: " If the Act did not apply in the first place to all applications, even under special and local laws, it would be mere waste of time to say that it was not to apply to those of them for which special periods were prescribed by those laws. It is clear that Article 181 of the schedule of the ‑Limitation Act governs the limitation of every application made .to a Court under any Act except those for which different periods are prescribed in the. Act itself under which they are made". The main case of our own Court bearing on the subject is Mian Abdul Aziz v. Punjab Government (A. I. R. 1942 Lah. 186). That was a case under section 16 of the Telegraph Act, which requires the District judge on an application made to him in this behalf to determine compensation for damage sustained by private land in the course of the installation of telegraph poles, and the question was whether Article 181 applied to such an application. It was held that the Article in question did not apply as such applications were in the nature of plaint's but in any case the application of that Article would be futile, for the starting point of limitation does not arise when the damage is caused but only when the right to apply accrues; and this in turn does not happen until the dispute with regard to the sufficiency of com pensation arises, which may not be until long after the damage is caused. The learned judges were also influenced by the fact that the question before them was one of "interpreting the terms of a restrictive Act". and, further, that "it hardly seems desirable now to adopt a view which would be difficult to reconcile with the settled course of decisions which have held that Article 181 does not coffer such applications as those made for the purpose of taking probate". They observed; however, that the question was entirely one of interpretation, and that it hardly seemed possible to evolve a formula which could make it permissible to treat Article 181 as applying to some applications in the nature of plaints, but not to others. It is patent that their Lordships confined there decision to the case before them. They were alive to the mischief that would be caused by allowing an application to be made after an unlimited period of time but to such an application, thought, the doctrine that a right may be lost by lathes could be applied and they left it to the District judge to decide whether the application before him could be dismissed on general grounds in view of the delay which had occurred. So far as the present case goes, it is doubtful whether it would be competent for a Magistrate acting under section 81 of the Municipal Act to adopt the doctrine of lathes. It may be observed that in the aforesaid case the learned judges did not accept the argument that in order to be hit by Article 181 an application must be under the Code of Civil Pro cedure, and they pointed out that there was at least one case (namely 31 Madras 24) in which the Article in question had been applied to a local Act. That was a case dealing with an application to a Civil Court for the delivery of possession under an .Act for the recovery of revenue and it was held that inasmuch 'as such an application was an application for the machinery of the Court to be put in motion, it should be treated as one falling under the provisions of the Civil Procedure Code. Referring to this case, their Lordships of our own Court observed that "this view seems to have been generally followed where proceedings in the nature of execution proceedings are concerned". It will be observed that the magistrate acting under section 81 of the Municipal Act also acts more or less as an executing Court. Further, it is also clear‑that he does not act merely in an administrative or ministerial capacity. When an application is made befor him, he may have to decide whether the tax claimed by the committee is in fact claimable, and he may have to decide, if an objection is taken to his jurisdiction, whether he has such jurisdiction. That the magistrate while acting under section 81 is within the revisional powers of the High Court is not a matter which can admit of much doubt. In 1927 Lahore 161 and 1934 Lahore 84 the High Court entertained revision petitions from the order of a magistrate under section

81. If those petitions were competent, then it was clearly accepted that the magistrate was acting as a Court. ( I do not, of course, accept the argument of the learned Senior Sub‑Judge that a magistrate is necessarily a Court because the definition of the term `Court' in section 3 of the Evidence Act includes a Magistrate, for that definition is restricted to the application of the Evidence Act itself). The ‑objection, therefore, that Article 181 is not applicable because the magistrate acts merely in a ministerial or administrative capacity while acting under section 81 of the Municipal Act, does not appear to me acceptable. Speaking for myself, since there is nothing in Article 181 to restrict it to applications made to a Court which are not purely of an administrative nature and which are likely to require a judicial decision. In a case like the present one, the party affected may be an illiterate person who could not be expected to preserve receipt for a period of ten years, in which case it would clearly be a hardship to permit a municipal committee to take out distress warrants after a long period of delay. As, however, this view is likely to disturb the "settled course of decisions" which to some extent influenced the judgment in Mien Abdul Aziz v. Punjab Government, it seems to me proper that the matter should be referred to a larger Bench. For this purpose orders may be obtained from my Lord the Chief Justice. ORDER MUHAMMAD SHARIF J.‑The main question falling for deter mination in this second appeal is whether an application under sec tion 81 of the Punjab Municipal Act for the recovery of any arrears of taxes, etc., is subject to any limitation? This has arisen in the following manner. The Municipal Committee of Sheikupura made a demand by a bill dated 27th of July 1944 for the house tax from the Executive. Engineer Canals of the Upper Chenab Circle for the period ranging between 1st of July 1922 and 1937‑

38. The Execu tive Engineer replied that the demand could snot be made for a period exceeding three years. The Municipal Committee did not agree, and after a notice, a suit for a declaration and permanent injunction by the Punjab Province through Collector, Sheikupura, was instituted against the Municipal Committee on 17th of June 1946. It was alleged that the claim was barred by time and could not be enforced by an application under section 81 of the Punjab Municipal Act. It was, therefore, prayed that it should be dec lared that the imposition of the house‑tax for more than three years was illegal and that a decree for permanent injunction be passed that the amount of the tax could not be recovered by an application to a Criminal Court or in any other manner. These allegations controverted by the Municipal Committee. The only issue tried in the case was "Is the claim time barred as alleged ?" It was held by the trial Court that Article 181 of the Jndian Limitation Act did not apply in the case of an application under section 81 of the Punjab Municipal Act and the claim, therefore, was not barred. The suit was dismissed. On appeal the learned Senior Sub‑Judge was of the view that Article 181 covered an application under section 81 of the Municipal Act as well and a claim for more than three years by the Municipal Committee could not be legally made. On this finding the appeal was accepted and the suit decreed. The Municipal Committee has now come up in second‑appeal. It was heard in the 'first instance by a learned judge in Chambers but in view of the importance and the novelty of the question involved, it was referred to a Division Bench. Section 81 of the Punjab Municipal Act is as follows :‑ 81. (1) "Any arrears of any tax, water‑rate, rent, fee or any other money claimable by a committee under this Act may be recovered on application to a Magistrate having jurisdiction within the limits of the municipality; or' in any other place where the person from whom the money is claimable may for the time being be resident, by the distress and sale of any 'moveable property within the limits of his jurisdiction belonging to such person. The costs' of such proceedings shall be recoverable from the defaulter in the same manner as the said arrears, (2) "An application made under subsection (1) shall be in writing and shall be signed by the President, a Vice-President or the Secretary or the Executive Officer of the committee, but it shall not be necessary to present it in person." No period of limitation is prescribed for this application in the Act. Article 181 of the Indian Limitation Act is as under :‑ "Application for which Three When the right no period of limitation years. to apply is provided elsewhere in accrues." this Schedule or by section 48 of the Code of Civil Procedure, 1908. This is a residuary Article and shall apply only where the other Articles are not found to be applicable. At one time, the view prevailed that the Article was restricted to applications under the Civil Procedure Code for which no provision in the other Articles, was made. In I. L. R. 54 All. 1067 (P. C.), their Lordships observed that "a series of authorities commencing with (1880) I. L. R. 7 Bom. 213, have taken the view that Article 181 only relates to applications under the Code of Civil Procedure." But the Privy Council left open the question whether Article 181 was so restricted or applied also to appli cations by a liquidator under section 186 of the Indian Companies Act, 1913, for an order on a contributory for payment of money due from him to the company. The judgment of the Privy Council has, however, been interpreted as " having accepted the view" that Article 181 only relates to applications under the Civil Procedure Code. This narrow view of the application of Article 181 to Civil Procedure Code only, was not followed in some cases arising under other Acts. In Mian Abdul Aziz v. Punjab Government re ported as A. I. R. 1942 Lah. 186, an application was made under section 16 of the Telegraph Act, 1885, for compensation. The decision was given in the alternative. In the first place, Article 181 was not held to apply to such applications and even if it applied, the right to apply did not accrue until the dispute with regard to the sufficiency of compensation arose. A. I. R. 1928 Nag. 194 laid down that "Article 181 governs the limitation of every application made to a Court under any Act except those for which different periods are prescribed in the Act itself under which they are made.' This was a case under section 247, subsection (5) of the Companies Act. The language 6f Article 181 is not restrictive of its applicability to the Code of Civil Procedure alone. It is wide enough to cover other applications of a judicial nature on which the Court is required to act and to exercise its powers as distinguished from those of a ministerial nature which the Court has no discretion to refuse. One argument that all other preceding Articles related to some matter under the Civil Procedure Code has lost much of its force by the insertion of Articles 158 and 178 of the Indian Limitation Act by Act X of 1940. This, however, appears to be plain that the application to fall under Article 181 must be made to a Civil Court as distinct from a Criminal Court. The application under section 81 of the Punjab Municipal Act is presented to a Magistrate. Unless he was sitting as a Civil Court, the application to him should not be governed by Article

181. It is true that the Magistrate moved under section 81 of the Punjab Municipal Act is acting like an executing Court or, like a Magistrate realising a fine under section 385 of the Code of Criminal Procedure. That he has been held to enjoy the latter status, would be clear from 23 P. R. 1903 (Cr.). In that case some arrears of a contract of Municipal sewerage were sought to be recovered by an application to a Magistrate. The Magistrate ordered the recovery by the distress and sale of movable pro perty. A revision was filed in the Chief Court that the money was not claimable under the Act and the Magistrate had no 'power to proceed in a summary manner. The Chief Court entertained the revision under section 439 of the Code of Criminal Procedure and it was held that the arrears of a contract were not 'recoverable under section 201 of the Punjab Municipal Act (corresponding to section 81 of the Punjab Municipal Act of 1911). Similarly in 2 P. R. 1910 (Cr.) the Chief Court interfered in revision with the order of the Magistrate on the ground that the money could not be recovered under the Act. These two decisions would establish (a) that the Magistrate proceeding under section 81 is acting judicially, subject to the revisional jurisdiction of the highest (b) that the Magistrate is not to act like an automaton to take proceedings for the recovery of the amount as demanded by the Municipal Committee. Ire has a right and a duty to see that the money which he is required to recover, was one which could be claimed under the statute constituting the Municipal Committee, that is, the claim was not ultra vires. The conclusion that an application to a Criminal Court is not subject to any limitation, would not necessarily mean that the Municipal Committee is entitled to recover arrears of tax, etc., for as long a period as it pleases. The application to a Magistrate might be made at any time for the recovery of arrears of‑ any tax, etc. In order to find when house‑tax becomes an‑ arrear, one has to go back to section 80 of the Punjab Municipal Act. It is in the following terms :‑

180. (1)' "When any sum is due on account of a tax payable under the Act in respect of any property by the owner thereof, the committee shall cause a bill for the amount; stating the property and the period for which the charge is made, to be delivered to the person liable to pay the same. (2) "If the bill be not paid within ten days from the delivery thereof, the committee may cause a notice of demand to be served on the person liable to pay the same, and, if he does not, within seven days from the service of the notice, pay the sum due, with any fee liable for the‑notice or show sufficient cause for non‑payment, the sum due, with fee, shall be deemed to be an arrear of tax. (3) "The amount of every such arrear, besides being recover able in any other manner provided by this Act, shall, subject to, any claim on behalf of His Majesty, be a first charge on the property in respect of which it is payable, and shall be recoverable, on application made in this behalf by the Committee to the Collector, as if the property were an estate assessed to land revenue and the arrearer were an arrear of such revenue due thereon: "Provided that nothing in this subsection shall authorize the arrest of a defaulter." Before a bill could be delivered; the amount stated in the bill must be due. The word "due" has been defined in Wharton's Law Lexicon as "that which law or justice required to be paid or done; anything owing; that which one contracts to pay or perform to another." The Municipal Committee has a right to recover a tax on account of the powers conferred upon it to do so under its Charter. It might proceed by way of suit in a Civil Court like any other individual. There is nothing to prohibit it, or it might proceed by way of speedy remedy provided in section 81 of the Act, i.e., by an application to the Magistrate. It does not stand to reason that the bar of limitation regarding the suit could be set at naught by proceeding before a Magistrate in the alternative way. Section 81 of the Punjab Municipal Act was obviously designed to do away with the long delay and procrastination that is usually associated with the Civil Court. The legislature could not intend that the Municipal Committee as a Corporation would cease to be subject to the comprehensive law of limitation. It might be argued that section 84 provides an appeal against the assessment or levy of any tax, and section 86 declares that the objection to valuation or assessment shall not be taken in any other manner or be questioned by any other authority than is provided in this Act. These have reference to the liability arising under the Act and not where the powers of the Municipal Com mittee are in question a matter which can only be decided by a Civil Court. This has now been set at rest by a Full Bench in Municipal Committee, Montgomery v. Master Sant Singh reported as A. I R. 1940 Lah.

377. It was held that "a Municipal Com mittee is a creature of the statute. It is brought into existence by, or under the authority of, an express legislative enactment to have control over municipal affairs within defined local limits and can exercise such powers of legislation, taxation and regulation as are entrusted to it by the Legislature. If, in the exercise of these powers, the Committee makes a mistake, it will merely be a case of erroneous exercise of jurisdiction, and the aggrieved party must seek his remedy in the manner, and from the forum, provided in the statute. If, however, its action is in excess of, or in contravention of the powers conferred on it by the statute, the subject has his ordinary remedy to seek relief in the Civil Courts unless their cognizance is either expressly or impliedly barred. The remedy provided in section 84 is confined to those Acts only which are done under the Act, and the bar provided in section 86 is similarly confined to matters covered by the Act and does not extend any further. The word `liability' as used in subsection (1) of section 86.refers to that liability which arises under the foregoing sections only. It cannot be conceived that the Legislature, while enacting a bar under section 86, contem plated any liability arising from a tax which was not permitted under the Act or any demand which was being made in contravention of the provisions of the Act. A tax demanded under section 61 (1) (c) from a person who is not an owner but only a hirer of motor‑lorries is ultra vires and a suit by such person for perpetual, injunction restraining the Municipal Com mittee from recovering such tax is entertainable by "Civil Court". The period of limitation in the case of a suit for the recovery of house‑tax may now be ascertained. There is no specific article dealing with it. In its absence, therefore, the residuary article for suits, that is, 120 shall apply and the limitation is six years to be calculated from the date "when the right to sue accrues." A suit for the recovery of terminal tax was held governed by Article 120, vide A. I. R. 1938 Sind 48, as also one for the recovery of a license fee, vide 175 I. C. 86‑ In the latter case it was observed that "the liability of the defendant does not arise out of any contract between himself and the Municipality, but out of an obligation imposed by the statute on licensees of platforms to pay the fees assessed by the Municipal Commissioners." If the contention of the learned counsel for the respondent that Article 181 should be held applicable to an application to a Magistrate for the recovery of a tax under the Act, be accepted, a curious position shall arise. While the Municipal Committee shall be entitled to recover tax for six years, its right to do so by way of application under section 81 of the Punjab Municipal Act shall be curtailed to one‑half. As remarked above, section 81 exists to provide an easy and speedy remedy for the realisation of‑ its dues and there does not appear to be any reason why a resort to a special procedure should work to the detriment of the Municipal Committee. This too would indirectly indicate that Article 181 was not intended to cover the case of an application under section

81. The learned counsel for the Committee relied upon A. I. R. 1939 Bom. 494, a Single Bench ruling. This too related to the recovery of house‑tax. Under the Bombay Municipal Boroughs Act (XVIII of 1925), the Municipal Committee was held to have been given special powers under section 105 to recover its dues by issuing distress warrants. When any amount was declared to be recoverable on account of tax, the Chief Officer had the right to present to any person liable for the payment thereof, a bill for the sum claimed as due. If the bill was not paid within fifteen days of its presentation, the Chief Officer could serve a notice of demand and under section 105, subsection (1) the Munici pal Committee could itself recover the amount by distress and sale of the movable property or the attachment and sale of the immov able property of the defaulter on whom a notice of demand had been served and who had failed to pay or had failed to show suffi cient cause to the satisfaction of the Chief Officer regarding non payment. Section 105 was considered not to limit in any way the power of the Chief Officer to recover the amounts of the taxes in, respect of which bills and notices of demand had been issued under section

104. The provisions of the Bombay Act are different from those in the Punjab Municipal Act. Further, the case can be easily distinguished for another reason. The tax had been paid out of fear, though under protest. The suits were instituted by the tax‑payers for the refund of the taxes paid. It was rightly held that the rule of limitation did not destroy the right and simply barred the remedy. The right was there but it could not be enforced through Court. The plaintiff's, therefore, could not succeed on this short ground. The effect of subsection (3) of section 80 of the Punjab Muni cipal Act may now be considered. If the arrear of house‑tax is not paid within the time allowed, it shall constitute "a first charge on the property in respect of which it is payable" and shall be so recoverable. This would mean that the arrear could be realised within twelve years under Article 132 of the Indian Limitation Act. It is, however, a different thing from saying that the arrears for more than six years shall be permitted to be recovered by the Committee. The limit of six years could not be transgressed but a long period has been allowed within which to make the recovery. It would follow that in the case of a tax or fee, or other due, which has not become a charge upon the property, the period within which it must be recovered must necessarily be not long. ' It has been mentioned above that no period of limitation is fixed for making an application under section 81 of the Punjab Municipal Act, but it should be made without an unnecessarily long delay. The Magistrate would be quite justified in refusing to issue a warrant if the Committee allows a very long interval to intervene between an arrear of tax and the steps for the recovery. The result of the above discussion is that the appeal must be accepted in part and the decree of the lower Appellate Court be modi fied so that the Municipal Committee shall only be entitled to recover house‑tax for a period not exceeding six years. As neither party has succeeded in the case and the point in dispute was of considerable difficulty, I would leave the parties to bear their ‑ own costs of this litigation throughout. M. R. KAYANI, J.‑‑That Article 181 of the Limitation Act is not confined to applications falling within the Code of Civil Procedure is ? view which seems to be gaining ground. In Mian Abdul Aziz v. Punjab Government (A. I. R. 1942 Lah. 186), notwithstanding that an application under section 16 of the Telegraph Act was not held to fall under Article 181, it was pointed out that at least in one case ...I. L. R. 31 Mad. 24...the article in question had been applied to a local Act, by which the recovery of revenue could be enforced on an application to a Civil Court for the delivery of possession. The argument used in that case, however, was that inasmuch as such application was an application for the machinery of the Court to be put in motion, it should be treated as one falling under the provisions of the Code of Civil Procedure. While referring to this case, the judges of our own Court in Mian Abdul Aziz v. Punjab Government observed that "this view seems to have been generally followed where proceedings in the nature of execution proceedings are concerned". In other words, if an application is of the nature of an execution application, Article 181 might be applied to it. One reason why Article 181 was held to apply to applications under the Code of Civil Procedure only was that all other applications in the Third Division relate to proceedings under that Code. This reason, as my learned brother has pointed out, has disappeared by the amendment of Articles 158 and 178 by Act X of 1940, so that applications under those articles now refer to the Arbitration Act. It is true that this change has been occasioned by the substitution of the Arbitration Act for the Second Schedule of the Code, which formerly governed arbitration proceedings, but the fact remains that as the First Schedule of the Limitation Act stands at present, at least two of its articles provide periods of limitation for applications which are not made under the Code of Civil Procedure. The Limitation Act by its pre‑amble was intended "to consolidate and amend the law relating to the limitation of suits, appeals and certain applications to Courts". Two things are thus clear as regards applications ; one, that it provides only for "certain" applications, not for all ; the other, that the applications must be to Courts. I think these two circumstances must control and circumscribe each other. There may thus be an application to a Court, not purely of a judicial character, an application for instance, to adjourn the hearing of a ease to another date. It may be for that reason that the words used are "certain applications", or it may have been intended merely to says that only such applications as would be specified in the Schedule would be covered by the Act. But if the intention had been to limit those applications to the Code of Civil Procedure, it would be unnecessary to use the words "to Courts", for such applications would always be to Courts. The force of the entire phrase "certain applications to Courts" can best be felt if some sort of a character is bestowed on those applications. Should they be applications of an administrative character, of a purely civil nature, or of a broad judicial character, of a type that require adjudicating upon ? I think it will be agreed that they should be applications which call upon the Court to give its decision on a point in issue, without restricting the meaning any further. Then it will be noticed that these applications are made to Courts, not necessarily to Civil Courts in particular or to Criminal Courts in particular. The nature of the Court will be determined by the nature of the application, which being essentially of a character that requires the determination of issue, we would prima facie be inclined to say the Court intended was a Civil Court. But if the Court mainly devoted its time to matters of a criminal nature, while the application itself were not of a criminal nature we cannot reasonably say that the application loses its character by mere institution in a Criminal Court. If the Provincial Government can be empowered by statute to confer upon a Civil Court the powers of a Magistrate and vice versa, there is no reason why the statute should not be able to direct a Magistrate to perform functions which are by their very nature civil or quasi‑civil functions, without going through the formality of conferring civil powers expressly. The mere fact that an application lies to a Magistrate or a Criminal Court should not lead us into believing that it is not an application of a civil nature. The primary function of a Magistrate as the, presiding officer of a Criminal Court is to try a person accused of an offence and to punish him if he is found guilty. When, however, an application is made to him under section 81 of the Municipal Act, neither is the respondent before him an accused person nor is the Magistrate called upon to find him guilty or not guilty. The Committee has a claim against him for arrears of a tax, and if the Magistrate finds that the tax is a tax under the Act and that he has not paid it, he will issue a distrait warrant against the movable property belonging to the respondent. Section 81 requires that it should be an arrear of tax. Before a tax becomes an arrear of tax, certain formalities are to be observed under section 80, and if these formalities have not been observed,, there can be no proceeding under section

81. The respondent may therefore defend the application by stating that the claim against him has not become an arrear of tax, in which case the Magistrate will be found to adjudicate upon the case. Again, an application may be made under section 81 in respect of a contract of municipal sewerage, as happened in 23 P. R. 1903 (Cr.), and the Magistrate will have to decide whether such a claim falls under section

81. In arriving at a finding in these cases, the Magistrate discharges the functions of a Civil Court. The fact that in 23 P. R. 1903 (Cr.), the Magistrate was treated as a Criminal Court from which a revision is competent to the High Court merely means that for the purposes of appeal and revision it was necessary to decide whether the Magistrate acted as a Court or Merely as an Executive Officer, and if he was acting as a Court, then since a Magistrate is ordinarily the Pre siding Officer of a Criminal Court, it would have been anomalous to treat him as a Civil Court simply because the rights upon which he should have adjudicated were of a civil nature. Take for instance an application for maintenance under section 488 of the Code of Criminal Procedure. It is made to a Magistrate, and when he orders the payment of an allowance, the respondent can be forced to pay by the issue of a warrant for the attachment and sale of property and may even be sentenced to imprisonment for a small term. But has it ever been argued that the proceedings under section 488 are of a criminal nature and that the respondent assumes the status of an accused person because he can be sentenced to imprisonment ? It is well‑known that whenever the Le8islature intends to devise a speedy remedy, it provides for an application to a Magis trate largely because a Magistrate has normally a light file of between thirty and fifty cases, each of which may take a day or two in the trial, as against a file of four to six hundred cases in the Court of a Civil judge ; partly also because such application is not expensive in the institution. This does not however mean, unless‑ there is an express direction to that effect, that even time barred claims can be revived because of the existence of a speedier remedy. An application under section 81 is essentially of the nature of an execution application, and even on the reasoning adopted in I. L. R. 31 Mad. 24 and Mian Abdul Aziz v. Punjab Government, to which I have referred in the first para graph of this judgment, Article 181 should be applicable to it. My learned brother has pointed out, rightly if I may say so with respect, with reference to the opening words of section 80 of the Municipal Act, that a sum does not become "due" on account of a tax unless it is legally due, that is to say, unless it can be claimed in an ordinary Civil Court, where it would be governed by the limitation of six years provided by the residuary Article

120. It is only when a sum is thus due by way of a tax that the Committee can proceed to make a bill for payment, and in the event of non‑payment within seven days, to issue a notice of demand. It is even when this notice is not complied with that the sum due is deemed to be an arrear of tax, which then becomes a charge on the property to which it relates, and may be recovered, in addition to any other mode of recovery, as an arrear of land revenue. The other mode of recovery is that provided by section

81. It will be seen that as an ordinary claim in a Civil Court the period of limitation to which the tax is subject is six years, but that when with the adoption of certain formalities it becomes a charge on the property, the period of limitation is extended to twelve years by the operation of Article 132.. My learned brother has pointed to the anomaly which would arise if Article 181 were held applicable to an application under section 81 of the Municipal Act, for while under that article the period of limitation would be only three years, if the claim were made in an ordinary Court, a limitation of six years would be available. This, to' my mind, is just as it ought to be, for section 81 provides a Speedy remedy which exists only against movable property, and if the Committee is prompt and anxious to realize its dues speedily, it should find a period of three years quite ample. If, however, the Committee is disposed to be leisurely, it can proceed to the Civil Court and pursue its remedy not only against movable property but also against immovable property, within a period of six years. As a matter of fact, section 80 itself furnishes an "anomaly" by extending the period of limitation from six to twelve years. But I do not regard either case as an anomaly merely because different periods of limitation are provided for different remedies. Now it is noticeable that section 81 enables an application to be made only in respect of an arrear of tax. This term has assumed a technical character by reason of the procedure indicated in section 80, which deems a tax as an arrear of tax after a bill remains unpaid for ten days and a notice of demand is not res pected for seven days. This means that so long as a tax has not become an arrear of tax, no application can be made under section 81, and it‑‑ is only after it has become an arrear that a limitation of three years will govern it for the purposes of an application under section

81. If, therefore, section 80 itself did not provide any limitation, the Committee might make a bill twenty years after the tax became payable, and declaring it under section 80 as an arrear, proceed to apply for distraint order under section

81. I respectfully agree, however, with my learned brother that tile opening words of section 80‑"when any sum is due on account of a tax"‑necessarily, mean that it should be due legally, that is to say, be claimable in a Court of Law, and that consequently, if the bill is made after a lapse of six years, the amount will not be "due", and section 80 will cease to operate. I would, therefore, hold that Article 181 of the Limitation Act will apply to an application under section 81 of the Municipal Act, subject to the limitation implied in section

80. In view of‑ a difference of opinion, the case should be referred to a Full Bench, as the point involved is a novel one. MUHAMMAD MUNIR, C. J.‑This is a reference under clause 26 of the Letters Patent on difference of opinion between my brothers Muhammad Sharif and Kayani. By a bill, dated the 27th July 1944, the Municipal Committee of Sheikhupura demanded from the Irrigation Department of the Punjab Government a sum of Rs. 186‑0‑9 as house‑tax on certain buildings of the Canal Department situate ‑within the limits of that Committee. The amount was alleged to be due to the Com mittee for the period 1st July 1922 to 31st March 1933. The Irrigiati6n Department refused to make payment on the ground that the claim in respect of this sum had become barred by time but the Committee maintained that there was no question of the claim being barred by time because the amount could be claimed at any time by a notice of demand under section 80 of the Punjab Municipal Act and recovered by the distress and sale of any movable property of the taxpayer within the limits of its jurisdiction on an application being made to a Magistrate under section 81 of that Act. This position was not accepted by the Provincial Government, with the result that on the 17th June 1946 a suit was instituted by that Government against the Municipal Committee asking 'for a declaration that the amount in question was not liable to be recovered by reason of the claim to its recovery having become barred by time. The Court of first instance held that the position adopted by the Committee was correct in law and that the amount could be recovered by an application under section

81. The suit was, therefore, dismissed, On appeal, the Senior Sub‑Judge took a different view and held that the tax due for the three years preced ing the presentation of the application under section 81 could be recovered but not the tax due for any anterior period. Accordingly, the appeal was accepted and the suit decreed in accordance with that finding. The Municipal Committee appealed against the order of the Senior Sub‑Judge. The appeal was first heard by Kayani, J. who referred it to a Division Bench in view of the importance of the question involved. The matter was, therefore, referred by me to a Division Bench consisting of Muhammad Sharif and Kayani, JJ. Kayani, J. has taken the view that an application under section 81.of the Punjab Municipal Act is governed by Article 181 of the Limitation Act while Muhammad Sharif J. is of the opinion that the Municipal Committee can recover by an application to a Magistrate only tax due for the six years preceding the date on which the application is made. The suit was plainly founded on the allegation that by reason of the period of limitation for the recovery of the amount having expired, the plaintiff's liability to pay the amount had ceased to exist and that the plaintiff had acquired a right to retain the sum in question. The action was, therefore, a wholly misconceived step because it is an elementary principle of law that limitation can only be set up as a bar to a claim and that by itself it furnishes no cause of action to a party except where section 28 of the limitation Act is applicable and the party in possession of a property has acquired a prescriptive title to it. In such exceptional cases threatened dispossession or actual dispossession of the party who has prescribed for the requisite period may constitute a good cause of action for that party. But where, as in this case section 28 is not applicable, a party cannot sue for a declaration that the remedy against him having become barred by time, his liability has dis appeared or that he has been legally invested with a right and that what was wrongful before the period of limitation had run out has become lawful after the expiration of that period. This result follows from the rule that statutes of limitation being processual enactments assume the existence of a cause of action and do not define or create it. Thus, to illustrate the point, if Government had made the payment without prejudice or under a threat of distress and sale, it could not have sued fox recovery of the amount on the ground that by the lapse of time its liability to pay had disappeared and the payment was made by mistake or under duress. This was the principle on which the plaintiff was non‑suited in Surat Borough Municipality v. Sarifa Karannissa, A. I. R. 1939 Born. 494, to which I shall again have the occasion to refer. In the present case the plaintiff instead of opposing the enforcement of the remedy when steps for its enforcement were taken seeks to make the expiration of the prescribed period cause of action. This it cannot do. Even assuming, therefore, that the claim to the recovery of the tax had become barred by time, no suit for a declaration was competent and the only course open to the plain tiff was to set up limitation as a defence to any step that the. Com mittee might have chosen to take for the recovery of the amount. Even if the suit was competent, it should have failed on the question raised. Section 80 of the Punjab Municipal Act is in the following terms :‑

"(1) When any sum is due on account of a tax payable under this Act in respect of any property by the owner thereof, the Committee shall cause a bill for the amount, stating the property and the period for which the charge is made, to be delivered to the person liable to pay the same. "(2) If the bail be not paid within ten days from the delivery thereof, the committee may cause a notice of demand to be served on the person liable to pay the sum and, if he do not, within seven days from the service of the notice, pay the sum due, with any fee leviable the notice, or show sufficient cause for non‑payment, the sum due, with the fee, shall be deemed to be an arrear of tax. "(3) The amount of every such arrear, besides being recover able in any other manner provided by this Act, shall, subject to any claim on behalf of His Majesty, be a 'first charge on the property in respect of which it is payable, and shall be recover able, on application made in this behalf by the Committee to the Collector, as if the property were an estate assessed to land revenue and the arrear were an arrear of such revenue due thereon : The Act proceeds to say in section 81; "Any arrears of any tax, water rate, rent, fee or any other money claimable by a committee under this Act may be recover ed on application to a Magistrate having jurisdiction within the limits of the municipality, or in any other place where the person from whom the money is claimable may for the time being be resident, by the distress and sale of any movable property within the limits of his jurisdiction belonging to such person . There is nothing in the Act to prevent the recovery of a tax by a Municipal Committee by a regular suit. Besides that mode of recovery, there are two other ways in which a sum due on account of a tax may be recovered by the Committee. If the amount becomes an "arrear", it becomes a charge on the property under subsection (3) of section 80 and may be recovered by an applica tion to the Collector as if the property were an estate assessed to land revenue and the arrear were an arrear of such revenue due thereon. In the alternative a Committee may recover the arrear by the distress and sale of movable property of the tax‑payer by making an application to a competent Magistrate. The condition precedent in either case, however, is that the amount claimed should be an "arrear". Now section 80 defines the manner in which a sum due to a Municipal Committee becomes an arrear. The Committee has first to deliver a bill to the person liable, and if that bill is not paid within ten days, a notice of demand has to be sent to him. If even then the amount is not paid within seven days of the service of the notice, it "shall be deemed to be an arrear of tax". It is thus clear that the amount due can become an arrear of tax only if the procedure prescribed by section 80 has been adopted. If that procedure is not followed, the amount is not an arrear of tax within the meaning of section 80 whatever else it might be. And unless the amount becomes an arrear of tax it can neither become a charge on the property under subsection (3) of section 80 nor can it be recovered by an application to a Magis trate under section 81 of the Act. In the present case there is nothing to show that the amount had become an arrear of tax by the Municipal Committee having served a notice of demand and the amount not having been paid for seven days after the service of that notice. Assuming a suit lay, it could succeed only if Govern ment could show that the amount in question had become an arrear of tax so long ago that an application for its recovery under section 81 had become barred by time and that it could also not‑be recover ed as an arrear of land revenue by an application to the Collector under subsection (3) of section

80. There is no evidence on record to show that any notice of demand was sent by the Municipal Committee and that being so, the amount has not yet become an arrear of tax. This, however, does not mean that the Municipal Committee cannot now make the sum in question an arrear of tax. The last bill was delivered by the Committee on the 27th July 1944 and because the amount was not paid within ten days, a notice of demand can be sent even now. And if such notice is sent and no payment is made within seven days of the receipt of the notice, the sum will become an arrear of tax within the meaning of section 80 and the limitation, if Any, for an application under section 81 or subsection (3) of section 80 will run from the date on which it becomes an arrear of tax. It is contended by the learned counsel for ‑the respondent that this interpretation of the Act would enable a Municipal Committee to go on accumulating the amount due for indefinite periods and to recover the amount so accumulated by an application under section 80 (3) or section

81. That may be se, but does it necessarily lead to the result that the Committee cannot do so ? Once the Committee delivers the bill, it is the owner's business to make the payment, and he cannot complain that the Com mittee should immediately have proceeded to serve a notice of demand because the bill remained unpaid. It may be 'that if a suit for the recovery of a tax is brought, it will be governed by Article 120 of the Limitation Act and the Committee will not be able to recover the amount that fell due more than six years before such suit. It does not, however, follow from this that the limitation for recovery of the amount is six years irrespective of` the method adopted for the recovery. There are numerous instances where the law leaves it to a party to elect whether, to achieve his object, he should bring a suit or take some other proceeding, there being no general rule that for the relief claimed there can be only one period of limitation, whether the relief is claimed by a suit or by some other method. In this very case if the amount is to be recovered through the Collector as an arrear of land revenue, the limitation would be twelve years to enforce the charge. An application under section 81, however, may be barred by time if the amount became an arrear of tax more than six or more than three years before the date of the making of the application according as Article 120 or Article 181 be held to be applicable to the application. I cannot discover anything express or implied in the Punjab Municipal Act rendering it obligatory on the Municipal Committee to serve a notice of demand immediately the amount becomes due and remains unpaid after the delivery of the bill. Subsection (1) of section 80 enjoins the Committee to cause a, bill to be delivered when any sum becomes due, but that section does not impose any obligation on it to cause a notice of demand to be served if the bill is not paid within ten days from the delivery thereof. The use of the Word "may" in that subsection clearly makes it discretionary with the Committee to cause a notice of demand to be served, and this discretion, it seems to me, may be exercised by the Committee at any time after the bill remains unpaid for ten days. And unless such notice is sent and the payment rot made for seven days, the amount is not an arrear of tax either for purposes of sub section (3) of section 80 or for purposes of section

81. It is urged for the respondent that a bill for a sum can be delivered by the Committee only if the "sum is due'", and that a sum cannot be said to be due when all methods for its recovery have become barred by time. I cannot subscribe to this proposition because unless section 28 of the Limitation Act be applicable, a right is not lost to a ‑person entitled to it. That section, how ever, only applies to suits for possession of property and not to mere claims for money. A debt is not extinguished merely by the period of limitation having run out and, though the remedy, may be barred, the debt exists. It was so held in Subramania Aiyar v. Gopala Aiyar, I. L. R. 33 Mad. 308; as well as in Kamra 'v. Bishambar Das, 147 P. R. 1890 (F. B.), where Plowden, J. observed:

"The Act does not extinguish the right of a creditor to pay ment of a debt, when the period allowed for suing for a debt has expired, section 28 being restricted to the extinction of a right to property when a suit for possession of such property is time‑barred". The cases of claims under section 185 of the Indian Companies Act stand on an entirely different footing because both here and in England it is settled law that the period of limitation for a debt due to the Company is neither revived by the Company going into liquidation nor suspended on an order for winding up being made. There is no provision in the Companies Act like the one to be found in the Punjab Municipal Act according to which it rests with the Municipal Committee to make a claim an arrear of tax and then to adopt one of the two alternatives for its recovery if it does not choose to recover the amount by a suit under the ordinary law. The case is some what similar to, though not identical with, Surat Borough Municipality v. Sarifa Karun nissa. A. I. R. 1939 Bom. 494, where Lokur, J. held that though the bill under section 104 (1) of the Bombay Municipal Boroughs Act must be presented with the least practicable delay, the right to issue a notice of demand and then to recover the amount by a distress warrant under section 105 of the Act is not lost by lapse of time. In coming to that decision the learned judge referred to the rule which I have mentioned above that the law of limita tion is a rule of procedure and does not create or extinguish rights except , in the case of acquisition of title to immovable property by prescription under section 28 of the Limitation Act and that though the remedy may be barred, the right itself continues, to exist, and if there 6e any other remedy by which that right can, be enforced, the Limitation Act cannot come in the way. In the present case Government being the plaintiff, it was for it to prove that the amount in suit became an arrear of tax so far back that it could neither be recovered by an application under section 80 (3) nor by an application under section

81. This plaintiff has not been able to do. A clerk produced by the plaintiff alleged that no bill relating to the tax in question was received by the department concerned before the bill dated the 27th July 1944, but that bill itself refers to an earlier bill that had been sent to that department. But assuming that the first bill to be delivered was the bill of 27th July 1944, the position is not at all affected. Though the Act declares it the Com mittee's duty to prepare and deliver a bill as the tax becomes due, it does not define the consequences of a default by the Com mittee in this respect, and the period of limitation for a petition under section 80 (3) or section 81 is not affected by the default, as that period runs from the date when the claim becomes an arrear of tax and it does not become such arrear until a notice of demand is sent and no payment is made for seven days. The only possible consequence of such default that I can see is that if a suit were instituted for the recovery of the tax as money due, it would be barred if instituted more than six years after the tax became due. Since there is no evidence in this case that any notice of demand was sent, the period of limitation for an applica tion under section 80 (3) or section 81 has not as yet begun to run because the terminus a quo for such application is the date on which the sum due becomes an "arrear of tax", The suit was, therefore, rightly dismissed by the trial Court. Accordingly, I would allow the appeal, reverse the decree of the Senior Sub‑Judge and restore that of the trial Court. The appellant will have its costs throughout. In accordance with the opinion of the majority, the appeal is accepted, the decree of the Senior Sub‑Judge set aside and the suit dismissed with costs throughout. K. M. A./A. H. Appeal accepted