1975 PLP 368 (SCMR)

A learned Single Judge of the former High Court of West Pakistan, Karachi Bench, decreed the suit for the full amount with costs and interest at 6% from the date of institution of the suit but on an appeal under Clause 10 of the Letters Patent, a Division Bench of the same High Court main tained the decree only to the extent of Rs. 7,

135. The claim for the balance of Rs. 10,071 was rejected as being barred by limitation on the ground that a sum of Rs. 4,028 on account of electricity charges and a sum of Rs. 6,043 on account of street sweeping charges had been paid more than six years before the institution of the suit. The Letters Patent Bench did not reverse the finding of the learned Single Judge that the Municipal Corporation was "duty‑bound to supply electricity lights and sweep the streets within the area of the society at its costs" but only dealt with the question of limitation. In this Court also, the liability of the Municipal Corporation to provide these services was not disputed but leave was obtained only to consider the question of limitation. Learned counsel appearing in support of this appeal has accordingly confined his arguments to this question. He concedes that Article 120 of the 1st Schedule to the Limitation Act applied in this case. This Article reads as follows: ‑ ____________________________________________________________ No. Description of suit Period of limitation Time from which period begins to run. ____________________________________________________________ 120 Suit for which no Six years. When the right to period of limitation sue accrues. is provided else wherein this sche dule. He maintains that under the above Article the right to sue accrues only when the demand is refused and, in the present case, such refusal took place in 1962. The suit filed on 14‑2‑1963 was, therefore, well within time. In support of this contention he has relied on a decision of the Allahabad High Court in the case of Municipal Board, Ghazlpur v. Deokinandan Prasad (A I R 1914 All. 338) where also a suit for refund of octroi illegaly taken by the Municipality and refused to be returned, was held to be governed by Article 120 of the Limitation Act and the date on which the right to sue accrued was the date of the refusal. The facts of that case were that a contractor importing logs for the use of the Government was charged with octroi duty but, later, he obtained a certificate from the Public Works Department that the logs were for use of the Government work and then applied to the Municipal Board for the refund of the duty as provided for in rule 27 of the Municipal Account Code and based his cause of action as from the date of the refusal. It was con tended that Article 62 of the Limitation Act applied, but, the High Court repelled the contention and held that the suit was within time under Article 120, as, it was brought "within six years of the refusal to refund the money". Reliance in this connection has also been placed on two decisions of the Privy Council in the cases of Mst. Bolo v. Mst. Koklan and others (AIR 1930 P C 270) and Annamalal Chettiar and others v. A. M. K. C. T. Muthukaruppan Chettiar and another AIR 1931 P C 9). In the first case, the Privy Council observed that under Article 120 "there can be no right to sue until there is an accrual of the right asserted in the suit and its infringement or at least a clear and unequivocal threat to infringe that right by the defendant against whom the suit is insti tuted". In the second case also the same observations were repeated. This Court has also had occasion to consider the question as to when the right to sue accures within the meaning of Article 120 of the Limitation Act, In the case of F. A. Khan v. The Government of Pakistan (P L D 1964 S C 520) a suit for a declaration that the dismissal of a Government servant from his service was without lawful authority, was filed nearly eight years after the original order of dismissal. The suit was held to be governed by Article 120 of the Limita tion Act and that the right to sue accrued in that case when the final order in the departmental appeal was made. The exact question which is now be fore us did not arise there. The learned counsel appearing for the respondent, on the other hand, cantends that to start with, there was no right in the appellant to claim the refund at all, because, the general tax was paid by the owners of the bunga lows in the colony and not by the appellant and, therefore, if anybody can claim the refund, it is the owners of the bungalows and, in their case, the right to sue accrued from the date of each payment. The High Court was, therefore, right in holding that the right to claim the refund could be asserted only in respect of the payments made within six years of the date of the institution of the suit. It is contended by the learned counsel that the suit is not for compensation or damages but a suit for the repayment of a specific sum of money which the appellant had been compelled to pay although it was legally payable by the Municipal Corporation. In fact, in this case what the appellant was doing, was that he was waving a wrong and claiming the money back, as money paid on behalf of the Municipal Corporation by which it was legally payable. The suit ought, therefore, to have been held to be governed by Article 62 of the Limitation Act and not by Article 120 as held in the case of the Rajputana Malwa Railway Cooperative Stores Ltd. v. The Ajmere Municipal Board (I L R 32 All. 491). This was also a case of refund of octroi duty. We are unable to accept this contention that it was a case of a suit for the recovery of money had and received, which is governed by Article 62, but, it was a case for a refund of money paid on account of the defendant who was liable to pay the same. For Article 62 to apply these must exist a priority between the plaintiff and the defendant so that the latter can be said to have received the money on behalf of the plaintiff and held the same in trust for him. But where the receipt by the defendant is on his own account and not on account of the plaintiff this Article will have no application. In the present case refund was claimed from the general tax recovered by the defendant on its account and not on account of the plaintiff It was, there fore, Article 120 of the Limitation Act which applied and not Article

62. Now the next question is as to when does the cause of action accrue to demand the refund ? This will depend to a large extent upon the particular facts of each case, the nature of the relief sought and the precise averments in the plaint. The precise averments in this behalf are that since the Municipal Corporation had realized the general taxes from October 1952 it was liable to pay for the services it was legally bound to provide but it had not done so and the plaintiff had been compelled to pay for such services it was entitled to claim that the amounts so spent by it should be refunded. On this pleading the relevant date is the date of payment. The observations of the Judicial Committee of the Privy Council relied upon by the learned counsel for the appellant, in the cases earlier referred to, were in an entirely different context. The first was a suit for a declara tion of title under a will. It was in those circumstances held that the cause of action arose when the right was actually infringed and not when the testator died. The second was also distinguishable on its own facts. The right to claim refund, therefore, arose in the present case, as and when each payment was made under Article 120 of the Limitation Act and, therefore, the Letters Patent Bench in the High Court was right in holding that, since, the appellant's claim was based on the allegation that it was entitled to get the refund on the ground that these services were the obliga tion of the Municipal Corporation the amounts paid "were recoverable through Court if the recovery is claimed within six years of the payments". This view appears to us to be correct. We, accordingly, see no reason to interfere. This appeal is, accordingly, dismissed but there will be no order as to costs. Appeal dismissed.