PETITIONER: K. M. S. LAKSHMANIER AND SONS Vs. RESPONDENT: COMMISSIONER OF INCOME TAX AND EXCESS PROFITS TAX, MADRAS. DATE OF JUDGMENT: 23/01/1953 BENCH: <NAME>, <NAME> (CJ) BENCH: <NAME>, <NAME> (CJ) MUKHERJEA, B.K. AIYAR, N. CHANDRASEKHARA BOSE, VIVIAN HASAN, GHULAM CITATION: 1953 AIR 145 1953 SCR 1057 CITATOR INFO : R 1959 SC 346 (11,13,14,15,16) D 1964 SC1709 (10) ACT: Excess Profits Tax Act (XV of 1940)-Rules under Schedule II, R. 2-A-Computation of average capital -Security deposit received from customers-Whether "borrowed capital"-"Deposit' and "Loan"-Essentials of. HEADNOTE: The assessees, who were the sole selling agents of a yarn manufacturing company and who distributed yarn to several constituents under forward contracts, kept two accounts for each constituent, viz., a "contract deposit account" and a "current yarn account", crediting the moneys which they received in advance from the constituents in the former account and transferring them to the current yarn account in adjustment of the price of the bales supplies then and there, that is to say, when deliveries were made under the contract. On the 5th. May, 1944, they decided to keep the advance amounts under a now heading "Contracts Advance Fixed Deposit Account" and to return the advance amounts in full after the completion of each contract and payment of the full value of the bales supplied. On the 5th December, 1944, they changed the name of this account into "Security Deposit" account, and on the 14th February, 1945, the assessees decided to modify the arrangement further and demand a certain sum from each customer towards Security Deposit and keep the same with the assesses so long as the business connection with the customer under the forward contracts continued. Interest was also allowed on the amount of the deposit. The question being whether the advance amounts received by the assessees as deposit were "borrowed money," within the meaning of Rule 2-A of the Rules in the Second Schedule to the Excess Profits Tax Act, 1940, and should not be deducted in computing the average capital used for the purposes of the business: Held, (1) that the advance amounts received before the 5th May, 1944, were only advance payments of the price, to be adjusted on delivery, and could in no sense be regarded as borrowed money; (ii)the amounts received after the 5th May, 1944, up to 14th February, 1945, were also, having regard to the terms of 137 1058 the arrangement then in force, more in the nature of trading receipts than of security deposits as they were really advance payments in regard to each contract, and the transaction provided in substance effect for the adjustment of the mutual obligations on the completion of each contract; (iii) the method of dealing adopted after the 14th February, 1945, had all the essential elements of a, transaction of loan, and the deposits received after that date were "borrowed money" for the purposes of Rule 2-A, as the amount of deposit had no relation to the price of the goods to be delivered under each contract, the price of the goods supplied was to be paid by the customer in full, the assessees were allowed to use the money for their own business paying interest to the customers, and the amounts were returnable only at the end of the business connection. The terms "loan" and "deposit" are not mutually exclusive, and the fact that a deposit is made with the object of inducing the person with whom the deposit is made to have dealing with the depositor and for the specific purpose of being held as security for the due performance by the depositor of his part of the contract, would not prevent a deposit from being really in the nature of a loan. <CITATION> . 63 I.A. 279) relied on. <ORG> v. <ORG> (L.R.  A.C. 507) and <ORG> v. <NAME> ( 1 All E.R. 482) distinguished. <NAME> v. <ORG> (32 Tax Cas. 133) applied. JUDGMENT:

CIVIL APPELLATE JURISDICTION Civil Appeal No. 71 of 1952.

Appeal from the Judgment dated 19th January, 1950, of <ORG> <ORG> at Madras (<NAME> and <NAME>) in Case Referred No. 67 of 1947. <NAME> (<NAME>, with him) for the appellants.

<NAME>, Attorney-General for India (<NAME>, with him) for the respondent.

1953. January 23. The Judgment of the Court was delivered by <NAME> appeal arises out of a reference made by <ORG>, Madras Bench, under section 21 of the Excess Profits Tax Act, 1940 (hereinafter referred to as the Act).

The appellants are merchants carrying on business in yarn in Madura and are the sole selling agents for yarn manufactured by <ORG>, distributing yarn to several' constituents under forward con tracts in respect of which they obtained advances of moneys from their constituents. During the charge able accounting period (13th May, 1944, to 12th 1945) the appellants received from their custom sums amounting to Rs. 7,69,569 and they claimed before the Excess Profits Tax Officer that the said sum should be treated as "borrowed money" within the meaning of Rule 2-A of the Rules in the Second Schedule to the Act and, on that footing, no excess profits tax was payable by them for the chargeable accounting period. The Excess Profits Tax Officer rejected the claim and assessed them to excess profits tax of Rs. 25,404, holding that, having regard to the terms of the agreement under which the amounts were received, they could not in law be regarded as "borrowed money" within the meaning of that Rule. Appeals to the Appellate Assistant Commissioner 'and <ORG> having failed, the appellants applied to the <ORG> for reference of the question of law arising in the case to <ORG> at Madras for its determination, and the <ORG> accordingly referred the following question:

"Whether in the circumstances of this case, the moneys deposited by customers with the assessee firm as security deposits were "borrowed money" within the meaning of Rule 2- A of the Second Schedule to the Excess Profits Tax Act, 1940, either throughout the chargeable accounting period ended 12th April, 1945, or during any part of that chargeable accounting period ? "

The reference was heard by a Division Bench of the Court (<NAME> and <NAME>) and the learned judges by their judgment dated 9th June, 1950, decided the question against the appellants but granted them leave to appeal to this Court As is well known, during the period of the war, profits arising from a trade or business were much higher than the pre-war standard of profits and the <ORG> wanted to catch a portion of such profits which it deemed to be in excess of the normal or "standard" profits. The Act accordingly charges a tax on the "excess profits" earned under war conditions and makes provision, inter alia, for cases where, as here, there is an increase of capital used for purposes of the business in the chargeable accounting period. In such cases the standard profits are to the increased by an amount calculated by applying the "statutory percentage" (varying from 8 to 12 per cent. in different classes of cases) to the increase in capital. Thus, with the increase in -the capital employed in the chargeable accounting period, there would be an increase in the standard profits and a decrease in the excess profits. Where the increase in the capital is brought about with borrowed money, it is but fair that such money,which plays its part in earning the larger profits, of which the <ORG> claims a substantial share, should not be deducted in computing the average capital used for the purposes of the business. Rule 2-A of the Rules in the Second Schedule to the Act accordingly provides that in computing the average capital during the chargeable accounting period and the relative standard period "no deduction shall be made in respect of borrowed money". In the present case, the appellants having admittedly received no security deposits during the standard period, the increase in the average capital employed in the chargeable accounting period would be much greater than what it has been computed to be, if the security deposits received, which were all used for the appellants' business, were treated as borrowed money and part of the average capital of their business for the chargeable accounting period, and that, as stated above, would result in a considerable reduction of the excess profits as now assessed. What then is the true legal character of these security deposits ?

The sums in question were received by the appelants under three different arrangements with their customers evidenced by the circulars issued to them. The first of these circulars issued on 5th May, 1944, was in the following terms:

" You are quite aware of the fact that we are and will be, so long as the existing contracts of bales are closed, transferring the Contract Advance Deposit amounts to the credit of current yarn account for the bales supplied to you then and there.

Now, what we have decided in this connection is not to do so as stated above, but to keep such advance amounts under the new heading " Contracts Advance Fixed Deposit Account " and return in cash or by bank's cheque or by insured post the advance amount of the bales booked and supplied in full under certain contract number only after completion of that contract with the bank's commission etc. expenses that may be incurred therein on your account.

The value of the bales delivered or to be delivered for each and every time should be paid in full and this system is applicable to our future booking of contracts only." This was followed by another issued on 5th December, 1944, which runs thus:

"This is to inform you that we have changed the heading of your " Contracts Advance Fixed Deposit " account into " Security Deposit " account. As such, we have transferred the amount which is to your credit in the former to the credit of your latter account. This is with effect from 1st November, 1944. Kindly note."

The arrangement was further modified by the last circular dated 14th February, 1945, which was in these terms "Instead of calling for amounts from you towards 'Security Deposit due to bales for which we are entering into forward contracts with you and returning the same to you from the said deposit then and there, as we are doing now, and in order to make. it feasible, we have decided to demand from you a certain sum towards Security Deposit and keep the same with -us so long as our business connection under forward contracts will continue with you. In your case, we have fixed a sum of Rs for the said deposit, which amount we have to keep with us on your approval. Against the said amount, a sum of Rs stands credit with us now in the said deposit. Therefore, the balance of Rs due by you to you, is to be remitted will be returned. Kindly let us have your reply immediately in this connection.

Please note that interest of 3 per cent. per annum will be allowed as usual to the said deposit amounts until further notice."

It will be seen that before the 5th May, 1944, which covers the first seven weeks of the chargeable accounting period, the appellants had two accounts for each constituent, namely, a " contract deposit account " and a " current yarn account ", crediting the moneys received from the customers in the former account and transferring them to the yarn account in adjustment of the price of the bales supplied ,then and there", that is, as and when deliveries were made under a contract either in installments or in full. It is clear that the amounts received from the customers under this arrangement were merely advance payments of the price which were to be adjusted against the value of the bales supplied from time to time under the forward contracts and they can in no sense be regarded as borrowed money. This indeed was not disputed by Mr. <NAME>. It was also conceded by him that the circular of 5th December, 1944, which merely changed the heading of the account in which the moneys received were credited, did not alter the legal position as it then stood. Accordingly, the question arises only with reference to the amounts received between 5th May, 1944, and 14th February, 1945, which covers the major part of the chargeable accounting period and those received thereafter till the end of that period.

It will be convenient to deal first with the amounts received during the last part of that period, for, if we accept the view of the learned judges below that those amounts were not borrowed money, then a fortiori must amounts received during the second part be held not to be borrowed money.

The circular of the 14th February, 1945, marks a clear departure from the mode of dealing followed by the parties before the 5th May, 1944. The amount deposited by a customer was no longer to have any relation to the price fixed for the goods to be delivered under a forward contract-either in instalments or otherwise. Such price was to be paid by the customer in full against delivery in respect of each contract without any adjustment out of the deposit, which was to be held by the appellants as security for the due performance of his contracts by the customer so long as his dealings with the appellants by way of forward contracts continued, the appellants paying interest at 3 per cent. in the meanwhile, and having, as appears from the course of dealings between the parties, the use of the money for their own business. It was only at the end of the " business connection " with the appellants that an adjustment was to be made towards any possible liability arising out of the customer's default. Apart from such a contingency arising, the appellants undertook to repay an equivalent amount at the termination of the dealing. The transaction had thus all the essential elements of a contract of loan, and we accordingly hold that the deposits received under the final arrangement constitute borrowed money for the purpose of Rule 2-A.

The learned Attorney-General laid great stress on the fact that the amounts were deposited with the object of inducing the appellants to have dealings with the customers and for the specific purpose of being held as security for the due performance by the customers of their forward contracts, and that the appellants their selves fixed the amount to be deposited in each case. These features, according to him, distinguished these transactions from a real borrowing or a real lending which the expression " borrowed money " in Rule 2-A must be taken to connote. We are unable to see how the object which the customers had in view in making the deposits can affect the essential character of the transaction. If A pays money to B who agrees to return not the identical currency in specie but an equivalent sum subsequently, no bailment arises but simply a loan owing by B to A. The fact that it is called a " deposit " can make no difference. As pointed out by <ORG> in <CITATION> (1), the two terms are not mutually exclusive.A deposit of money is not confined to a bailment of specific currency to be returned in specie. As in the case of a deposit with a banker, it does not necessarily involve the creation of a trust but may involve only the creation of the relation of debtor. and creditor, a loan under conditions ". The fact that one of the conditions is that it is to be adjusted against a claim arising out of a possible default of the depositor cannot alter the character of the transaction. Nor can the fact that the purpose for which the deposit is made is to provide a security for the due performance of a collateral contract invest the deposit with a different character. It remains a loan of which the repayment in full is conditioned by the due fulfillment of the obligations under the collateral contract. The Attorney-General placed strong reliance, as did the learned judges in <ORG>, on the English decisions in <ORG> v. <ORG> (2 )and <CITATION> . (3). In the first case it was held that the stock issued by the <ORG> as consideration for the acquisition of the property of certain dock companies of London, which carried interest and was redeemable after twenty years, could not be regarded as representing " borrowed money " under Rule 2 of Part III of Schedule IV of the Finance (No. 2) Act, 1915, as that expression referred to "a real borrowing and a real lending ". The transaction was held to be a purchase of assets for consideration in the shape of the stock issued, though it was attended (1) (1936) L R. 63 I.A. 279.

(2) L.R. [1923] A.C. 507 (3) [1948] All E.R. 482.

with incidents in some respects similar to those which would have ensued if there had been a borrowing. may well be conceded that the term " borrow money " must be construed in its natural and ordinary meaning and implies a real borrowing and a real lending. But the holding that " there was nothing of kind " in the issue of stock as consideration for the purchase of certain assets, where " no money passe directly or indirectly between the parties to the tran- saction " is not of much assistance in determining the issue whether the security deposits now in question involved a real borrowing and a real lending. For the reasons already indicated, we are satisfied that they do answer to that description and constitute borrowed money within the meaning of Rule 2-A.

The other case cited is still less helpful. Under certain arrangements for financial facilities, A drew bills on B who accepted them and then, as an agent of A, discounted them with C and paid over the proceeds to A, who agreed to put him in funds before the maturity of the bills for paying them off. <ORG> held that the money thus raised was not " borrowed money " within the meaning of paragraph 2 (1) of Part 11 of the Seventh Schedule to the Finance (No. 2) Act, 1939, which provided that " any borrowed money shall be deducted " (for the purpose of Excess Profits Duty). After referring to the Port of London case (supra) as authority for the view that the words " borrowed money " require the existence of a borrower and a lender and that there must be a real borrowing in the legal sense of the word, the learned judges proceeded to inquire who could be the lender, if any, in the circumstances of the case and found there was none-not B, for an acceptor of a bill need not have any money in his hands at all to lend, not C who was only acquiring certain rights in the bill under the law merchant but was not lending money. They accordingly found it " impossible to discover that there was such a relationship " (of lender and borrower) either between A and B or between A and C. In the  present case, the relationship of lender and borrower in all its essential features is plainly recognisable between the depositors and the appellants, and that decision does not affect the matter one way or the other.

On the other hand, a more recent decision of <ORG> in <NAME> v. <ORG> (1), which Mr. <NAME> brought to our notice, is more in. point. <ORG>, which sold petroleum products in China through Chinese agents, required the latter to deposit with the company a sum of money in Chinese dollars to be held as security against possible default by the agent in payment for the products consigned to them and to be repaid when the agency came to an end. These deposits were, during the war, transferred to the United Kingdom for reasons of safety and were there held in sterling. Subsequently, when the Chinese dollar depreciated in relation to sterling, the amounts required to repay the deposits in Chinese dollars were much less than the sums held by the company as sterling equivalents of the deposits, and the question arose whether such deposits were trading receipts or receipts of a capital nature. In holding that they were capital receipts and the profit was therefore a capital gain, <NAME>, who delivered the leading judgment, observed :

"If the agent's deposit had in truth been a payment in advance to be applied by the company in discharging the sums from time to time due from the agent in respect of petroleum products transferred to the agent and sold by him, the case might well be difficult and might well fall within the ratio decidendi of <ORG> v. Simpson(1) and <ORG> v. Kelley.(1) But that is not the character of the de- posits here in question. The intention manifested by the terms of the agreement is that the deposit should be retained by the company, carrying interest for the benefit of the depositor throughout the terms of the agency. It is to be available during the (1) (1951) 32 Tax Cas, I33. (3) (1943) 25 Tax Cas. 292. (2) (1934) 19 Tax Cas. 62.

deriod of the agency for making good the agent's pefaults in the event of any default by him; but otherwise it remains, as I see it, simply as a loan owing by the company to the agent and repayable on the termination of the agency; and I do not see how the fact that the purpose for which it is given is to provide a security against any possible default by the agent can invest it with the character of a trading receipt."

The Attorney-General relied also upon certain decisions holding that security deposits received from employees were impressed with a fiduciary character so that the depositors were entitled to preferential payments from the assignee in bankruptcy of the depositee. He admitted, however, that there were decisions holding the other way, and we do not think it necessary to discuss that class of cases, as the manner in which such sums have to be dealt with under the Insolvency Act s has no direct bearing on the question now under consideration.

Turning now to the deposits received by the appellants from 5th May, 1944, to 14th February, 1945, we are of opinion that, having regard to the terms of the arrangement then in force, they partake more of the nature of trading receipts than of security deposits. It will be seen that the amounts received were treated as advance payments in relation to each "contract number" and though the agreement provided for the payment of the price in full by the customer and for the deposit being returned to him on the completion of delivery under the contract, the transaction is one providing in substance and effect for the adjustment of the mutual obligations on the completion of the contract. We hold accordingly that the sums received during this period cannot be regarded as borrowed money for the purposes of Rule 2-A.

Lastly, Mr. <NAME> suggested that the case having proceeded both before the Excess Profits Tax authorities and <ORG> on the footing that if the sums received from the customers during any part of the chargeable accounting period were held to be borrowed money, they must be included in the computation of the average profits for the whole. of the chargeable accounting period, no distinction should now be made between one part of the period and another for this purpose. We cannot accept that view. It is true to say that no such distinction was in fact made at any stage so far, but that is because it was held that none of the sums received under any of the arrangements was borrowed money within the meaning of Rule 2-A. But, if it be held that the a 'mounts received under one or more, but not all, of the agreements are borrowed moneys, then, obviously, the computation of average capital in accordance with Rule 2-A must take into account the different character of the sums received under each of the agreements which was in force during a part only of the chargeable accounting period. The form of the question referred to the court clearly recognises this and admits of a distinction being made, if necessary, between parts of the chargeable accounting period.

In the result we set aside the order of the court below and answer the question referred in the affirmative with reference to the last part of the chargeable accounting period, namely, 14th February, 1945, to 12th April, 1945, and in the negative with reference to the rest of that period. We make to order as to costs.

Order set aside.

Agent for the appellants: <NAME>.

Agent for the respondent: <NAME>.

<NAME>


JUDGMENT <NAME>, <NAME>

1. The first question we have to decide is whether the decree in this case is a mortgage decree. That point has not been very seriously argued by the learned <NAME> for the appellant, because he virtually admits that he cannot distinguish a recent decision of this Court in the case of <CITATION> (1896) I.L.R. 24 Cal. 473 from the present case upon that point. In my opinion the decree in this case was a mortgage decree.

2. That being so, the further question arises, whether the plaintiff is now entitled to take any further execution proceedings to obtain the benefit of this decree, the appellant urging that he is debarred from doing so by reason of the third paragraph of Section 230 of the Code of Civil Procedure which says that No subsequent application to execute the same decree shall be granted after the expiration of twelve years from any of the following dates."

3. The decree referred to in that paragraph of the section is admitted to be a " decree for the payment of money," and we therefore have to decide whether the decree, in this case, is a decree " for payment of money " within the meaning of that paragraph of Section 230. The decree was dated 16th May 1884, and the last execution proceedings were on the 14th May 1896, and the present application for execution is dated 30th November 1896, so admittedly a period of twelve years has expired from the date of the decree. The translation of the decree as handed up to me is in these terms: " It is ordered that the suit be decreed ex parte and the sum of Rs. 323 claimed (in the suit)and the costs of this suit Rs. 34-8 as., with interest at 6 per cent. per annum from thisday till the date of realization, plaintiff do get from the hypothecated property. If insufficient, defendant to remain personally liable."

4. This question has been before <ORG>, and it was there decided in the case of <NAME> v. <NAME> (1894) I. L. R. 16 All. 418 "that a decree for sale of hypothecated property made in a suit for sale upon a mortgage bond is not a decree for the payment of money within the meaning of Section 230 of the Code."

5. Looking to the reasoning upon which that decision is based, and having regard to the various sections of the Code of Civil Procedure to which attention is drawn in that judgment, with the object of showing that under certain sections of the Code the term "decree for payment of money" is used in contradistinction to other decrees, I concur in that decision and in the reasoning by which it is supported. This being so, I scarcely think that it is necessary to go through the various sections which have been referred to in the course of the argument, though I may briefly say that Sections 210 and 322 and 254 of the Code indicate to my mind the distinction to which I have referred, that is to say, the distinction drawn in the Code between a decree for the mere payment of money and a decree with other objects, and giving other relief. Reliance is placed by the appellant upon the case of <NAME> v. <NAME> (1885) I.L.R. 11 Cal. 718 decided by this Court, but there, as has been pointed out in the course of the discussion, was a distinct order upon the defendant personally to pay the money. In the present case there is no such order; there is merely that which is tantamount to a declaration that if the property be insufficient, the personal liability is to remain, and I may here remark that in this case as regards any personal liability of the defendants to pay the money, both the Courts below have held that the application is too late, and the execution proceedings decreed are confined to a realisation of the property only.

6. Reliance was placed by the learned <NAME> for the appellant upon certain passages in the judgments of <NAME> and <NAME>, JJ., in the case of <CITATION> (1896) I. L.R. 24 Cal. 473 to which I have already referred, and for the purpose of showing that in that case those learned Judges held that a mortgage decree, such as the present, was a decree for the payment of money within the meaning of Section 230 of the Code. I was a party to that decision, and the reliance I placed upon that section is indicated by my observations at p. 487 of the report. Personally I did not in that case express any opinion upon the point which is the subject of discussion before us now, though no doubt there are passages in the judgments of my learned brotherswhich do support the appellant's present contention. But speaking from recollection, and seeing that neither the case in <ORG> nor the case of <NAME> v. <NAME> (1885) I.L.R. 11 Cal. 718 were cited, and looking to the head note of the case Jogemaya Dassi v Thackomoni Dassi, (1896) I.L.R. 24 Cal. 473, as to the application to that case of Section 230, and to the circumstance that the point was not necessary to the decision, I am not satisfied it was the intention of those learned Judges finally to decide the point. But even if it were, the decision would not avail the appellant here as I notice that in that case there was a decree against the defendant personally for payment. For these reasons, avid, adopting as I do, the reasoning and conclusion of the learned Judges who decided the case in <ORG>, I think that a decree such as this is not a decree for payment of money within the meaning of paragraph 3 of Section 230 of the Code, and consequently that the order of the <ORG> below was right and must be affirmed.

Banerjee, J.

7. I am of the same opinion. Two questions have been raised before us by the learned <NAME> for the appellants: first, whether the decree in this case is a mortgage decree, that is a decree ordering sale of the mortgaged property, or whether it is simply a money decree, that is, a decree ordering the payment of money by the defendant; and, second, whether, even if the decree be held to be a mortgage decree, the present application for execution is not barred by Section 230 of the Code of Civil Procedure.

8. As to the first question, having regard to the terms of the decree, I am of opinion that it is a mortgage decree, that is, a decree ordering the sale of the mortgaged property coupled with a decree for the realization of the balance of the mortgage debt, if any, left after the sale of the mortgaged property, out of any other property belonging to the judgment-debtor. The terms of the decree in this case come very much nearer to the terms of the decree in the case of <CITATION> (1896) I.L.R. 24 Cal. 473 than to the terms of the decree which was the subject of discussion in the case of <CITATION> (1895) I.L.R. 22 Cal. 813. The last mentioned case is therefore distinguishable from the present; and following the case of <CITATION> (1896) I.L.R. 24 Cal. 473, I think we must hold that the decree in this case was a mortgage decree.

9. As to the second contention, the <ORG> below have already held that so much of the decree as authorizes the decree-holder to realise the judgment-debt out of any property of the judgment-debtor other than the mortgaged property is barred under Section 230 of the Code, and the only question now before us is whether that portion of the decree which directs the realization of the mortgaged debt by sale of the mortgaged property is also barred under Section 230. That question ought, in my opinion, to be answered in the negative. Although the first paragraph of Section 230 relates to a decree generally, the third paragraph which contains the rule of limitation now relied upon speaks of an application to execute " a decree for the payment of money or delivery of other property." Can it be said that the decree that is now sought to be executed is one for the payment of money, " or, more strictly speaking, is that portion of the decree made in the suit which is for the payment of money? No doubt, every mortgage decree directs the mortgagor within a certain time fixed by the <ORG> to pay the mortgage debt; and if such payment is not made, the decree directs the sale of the mortgaged property. The decree in this case did not specify any time within which payment was to be made. But we need not consider the question whether that defect vitiates the decree, because it is too late now to raise that question. What the decree-holder is now seeking to execute is only so much of the decree as directs the sale of the mortgaged property; and an application to execute such a decree is not, in my opinion, within the scope of the third paragraph of Section 230 of the Code. That the Code of Civil Procedure clearly observes a distinction between a simple decree for the payment of money and a decree directing the realization of money by the sale of mortgaged property, will be clear from Section 322 of the Code, and will also be borne out by a reference to Sections 254 and 295. The view I take is fully supported by the case of <CITATION> (1884) I.L.R. 16 All. 418.

10. As for the case of <NAME> v. <NAME> (1885) I.L.R. 11 Cal. 718 that is clearly distinguishable from the present, because the question that arose there was with reference to the applicability of Section 295 to the decree in that case, and it was held that Section 295 applied, one of the reasons evidently being that the decree in that case not only directed sale of the mortgaged property, but also authorized the realization of the money decreed by sale of property other than the mortgaged property.

11. As for certain observations of two of the learned Judges in the case of <NAME> v. <NAME> (1896) I.L.R. 24 Cal. 473 referred to, they have been considered in the judgment just delivered by the learned Chief Justice, and I need say nothing more than this, that those observations, though they may be construed as faveuring to some extent the construction contended for by the learned <NAME> for the appellant, are, observations that wore not, necessary for the decision of the case.


PETITIONER: <NAME> Vs. RESPONDENT: <NAME> MISHRA DATE OF JUDGMENT21/12/1973 BENCH: <NAME>, P. JAGANMOHAN BENCH: <NAME>, P. JAGANMOHAN DWIVEDI, S.N. GOSWAMI, P.K. CITATION: 1974 AIR 480 1974 SCR (3) 31 1973 SCC (2) 133 ACT: Representation of the People Act  Ss. 81 and 86--Presentation of election petition beyond prescribed period of limitation--Whether court has power to condone delay. Limitation Act , , Ss. 4, 5 and 29 (2) Whether delay in filing election petition can be condoned under s. 5- -Applicability of section to election petitions--Saturday last day of limitation--Filing on next Monday--If within limitation. HEADNOTE: Under s. 80A of the Representation of the People Act. 1951, <ORG> is given jurisdiction to try election petitions. Section 81 Prescribes the period of 45 days from the date of the election of a returned candid-ate as the period within which an election petition calling in question any election on one or more of the grounds specified in s. 100 (1) or s. 101 has to be presented. If the provisions of s of S. 81 are not complied with, s. 86 requires that <ORG> shall dismiss the petition. Rules 6 and 7 of the Election Rules framed by <ORG> provided, (i) that the petition must, first, be presented to the stamp Reporter (ii) The Stamp Reporter has to certify thereon whether it is in time and in conformity with the requirements of the Act and the rules in that behalf or is defective; (iii) the petition should be returned to the petitioner for removing the defects if any and for formal presentation to the judge in open <ORG> after removing the defects; (iv)if the judge who is designated to entertain and try election petitions is absent the petition shall be presented before the Bench hearing civil applications and motions; and (v) the date of presentation before the Judge or Bench, as the case may be, shall be deemed to be the date of the filing of the election petition for purposes of limitation. In the present case, the election petition was filed on Monday instead of on the previous Saturday which was the last day of limitation, and <ORG> dismissed the petition as time-barred. In appeal to this <ORG>, on the questions: (1) Is the <ORG> closed on Saturday because Judges do not sit, and (2) by virtue of s. 29 (2) Of the Limitation Act , 1963. are the provisions of ss. 4 to 24 and especially s. 5 of the Limitation Act applicable to election petitions, so that, the petitioner could show sufficient cause for not filing the petition within time, HELD: (1) (a) Under s. 4 of the Limitation Act, it is Provided that where tile prescribed period for any suit, appeal or aPPlication expires on a day when the court is closed, the suit, appeal or application may be instituted, preferred or made on the day when the court reopens. Even if s. 4 of the Limitation Act does not apply to election petitions s. 10 of the General Clauses Act, 1897, would certainly apply to election petitions. Under both the provisions where the prescribed period of limitation expires on a day when the <ORG> is closed the petition could be filed on a day when the court next reopens. But a court is not closed notwithstanding the fact that judges do not sit on any day if otherwise the court is open on that-day. [34H; 35C- <CITATION>  S.C.R., 208, Lachmeshwar Prasad Shakul v. <NAME>, I. L. R. 19 Pat. 123, <CITATION> 1. L. R. (1882) 5 Mad, 189 at 192, In re Thokkudubi- vyanu Immaniyelu and Others, (1948) 1 M. L. J. 49, <NAME> prasad and another V.Union of India, A. 1. R. 1954 Pat. 384 and <NAME> and another v. Bhogilal pandya A. 1. R. 1958 Raj. 307, referred to. (b) Rules 6 and 7 of the Elections Rules of <ORG> should be read subject to r. 24 of the same Rules; and so read, in so far as they are not inconsistent wit with the election rules, <ORG> Rules shall apply mutatis mutandis 32 to all election petitions. Rules 26 of <ORG> Rules provides for the presentation of the memorandum of appeal or application to the Registrar when no Bench is sitting, and after certification by him for presentation to a Bench on the next subsequent day on which the Bench is sitting. Rule 26 applies to an election petition also and is not inconsistent with r. 7, Election Rules. Rule 7 does not provide for a contingency where a Judge or Bench is not sitting on a day when the court is not closed. The practice of <ORG> is that Judges do not sit for judicial work on Saturdays and there are no Benches sitting on that day and consequently any provision made to deal with such a contingency could not be said to be inconsistent with the Election Rules. That contingency is provided for by r. 26 of <ORG> Rules. Further, it would be incongruous that a <ORG> is open on Saturday for presentation of appeals, applications, plaints or decrees etc. mentioned in r. 13 of <ORG> Rules even though Judges are not sitting on that day, but the <ORG> is closed on the same day for presentation of election petitions. Therefore, reading rr. 6 and 7 of the Election Rules with r. 26 of <ORG> Rules there is no doubt that an election petition can be presented, on the last day of the limitation even though the Judges are not sitting to receive or entertain an election petition, to the Registrar or, in his absence, to the other officers specified in r.26. [38H-39D] (2) (a) Section 29 (2) of the Limitation Act , 1963, provides that the provisions contained in Ss. 4 to 24 shall apply in so far as and to the extent to which they arc not expressly excluded by such special or local law. The words 'expressly excluded' could not mean that there must be express reference made in the special or local law to the specific provisions of the Limitation Act of which the operation is to be excluded. if on an examination of the relevant provisions it is clear that the provisions to the Limitation Act are necessarily excluded then the benefits conferred therein could not be called in aid to supplement the provisions of the Special Act . Even in a case where the special law does not exclude the provisions of s. 4 to 24 of the Limitation Act by an express reference it would, nonetheless be open to the <ORG> to examine whether and to what extent the nature of those provisions or the nature of the subject matter and schemes of the special law exclude their operation.[44C-F] (b) Section 86 of the Representation of the People Act, which is a special law, gives a peremptory command that <ORG> shall dismiss an election petition which does not Comply with the provisions to sections 81 , 82 or 117. (e) If the Limitation Act were to apply to an election petition which does not comply with s. 81 , it should equally apply for non-compliance with Ss. 82 and 117. But in <CITATION> ,  2 S.C.C. 530, it was held that the <ORG> had no discretion to condone the delay in non-compliance with the provisions of Ss. 82 and 117. If for non-compliance with the provisions of Ss. 82 and 117, which are mandatory, the election petition has to be dismissed under s. 86 (1), the presentation of an election petition within the period prescribed in s. 81 would be equally mandatory requiring dismissal of the petition for noncompliance with it. [44G] (d) On the terms of s. 29 (2) of the Limitation Act , the applicability of Ss. 4 to 24 of the Limitation Act has to be judged not from the terms of the Limitation Act but by the provisions of the Representation of the People Act relating to the filing of election petition and their trial. Sections 6 to 24 of the Limitation Act are not expressly excluded, but they cannot on that account be made applicable to proceedings under the Representation of the People Act , because, they are, in terms inapplicable. Therefore, the Representation of the People Act is a complete code in itself which does not admit of the application of any of the provisions of the Limitation Act mentioned in s. 29 (2) of that Act, including s. 5 , [45D] (e) Under s. 86 (5) of the Representation of the People Act <ORG> may allow the amendment of the particulars of any corrupt practice alleged in the petition but <ORG> shall not allow any amendment to the petition which will have the effect of introducing particulars of a corrupt practice not previously alleged in the petition. This is not permitted because it would amount to a new petition being filed after the period of limitation, indicating that s. 5 of the Limitation Act cannot be attracted. [46G] 33 (f) It is also significant that the delay in presentation of the election petition under the repealed s. 81 could be condoned by <ORG> in its discretion; but when the Act was amended in 1966 and jurisdiction was given to <ORG> to entertain and try the election petitions a similar provisions for condoning delay was not enacted, showing <ORG>'s intention not to confer such a power. The whole object of the amendment was to provide a procedure for more expeditious disposal of the election disputes by <ORG>. [47A] Therefore, the provisions of s. 5 of the Limitation Act do not govern the filing of an election petition or their trial. [49D] <CITATION> ., .1 S.C.R. 679, <CITATION> ,  S.C.R. 218 and <CITATION>  2 S.C.C. 759, referred to. [It is true that if the election petitions are thus dismissed the allegations of serious corrupt practice could not be enquired into and the purity of the elections cannot be maintained but that however is a matter which can be set right only by the legislature.] JUDGMENT:

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 870 of 1973. From the Judgment and Order dated the 26th March 1973 of <ORG> in Election Petition No. 1 of 1972. <NAME>, <NAME>, <NAME> and <NAME>, for the appellant.

<NAME>, <NAME>, <NAME>, <NAME>, <NAME>, <NAME>, <NAME>, <NAME>, <NAME>, <NAME> and <NAME>, for the respondent.

The Judgment of the Court was delivered by <NAME>, J.-In the bye-election to <ORG> from Darbhanga Parliamentary Constituency held on January 30, 1972, the respondent <NAME>-a candidate of <ORG> was declared elected on February 2, 1972, by a. margin of 91,078 votes against his rival <NAME> candidate of <ORG> at that election. The appellant an elector in that constituency presented an election petition on Monday, March 20, 1972, instead of on Saturday. March 18, 1972, which was the last day of limitation. The petition, however, was dismissed by <ORG> as being time-barred. Against that judgment and order this appeal has been filed under s. 116-A of the Representation of the People Act, 1951 (hereinafter referred to as 'the Act').

It may be mentioned that s. 80-A was added to the Act by the Amendment Act 47 of 1966, whereunder <ORG> was given .jurisdiction to try election petitions. This jurisdiction has to be exercised ordinarily by a Single Judge of that Court and the Chief Justice could from time to time assign one or more Judges for that purpose. Section 81 prescribes the period of 45 days from the date of the election of a returned candidate within which an election petition calling in question any election on one or more grounds specified in sub-s. (1) of s. 100 and s. 101 has to be presented to <ORG>. If the provisions of s. 81 are not complied with, s. 86 requires that <ORG> shall dismiss the petition. There is no doubt that election petition in this case has been presented beyond the period of 45 days and has necessarily to be dismissed.

What we have to consider, however, is that whether having regard to the requirements of Tr. 6 and 7 of the Rules for the Disposal of Election Petitions framed by <ORG>, an election petition should only be filed before a Judge of <ORG> sitting in open Court, and it could not be filed on a Saturday when the Judges do not sit and hence the filing of that petition on Monday, March 20, 1972, Sunday being a holiday, is in time. Even if it be held that the filing of the petition was beyond the time prescribed in s. 81, it has further to lie considered whether the provisions of s. 5 of the Limitation Act 36 of 1963 are applicable to such petitions and whether the petitioner has shown sufficient cause in the petition which has now been filed before this Court for not filing the petition in time to enable the Court to admit it after the prescribed period..

Three questions which require determination are-

Is the <ORG> closed on Saturday, when the Judges do not sit (1) for the purposes either of s. 10 of the General Clauses Act, or s. 4 of the Limitation Act?

(2) By virtue of s. 29(2) of the Limitation Act, are the provisions of ss. 4 to 24 of the said Act applicable to election petitions? (3) If they are, and s. 5 of the Limitation Act is applicable, do the facts of the case warrant condonation of delay?

On the question whether the petitioner could have filed the petition on Saturday, March 18, 1972, what has to be seen is whether the <ORG> can be said to be closed within the meaning. of either s. 4 of the Limitation Act, 1962, or s. 10 of the General Clauses Act, 1897, because under both the provisions where the prescribed period of limitation expires on a day when the <ORG> is closed the petition could be filed on a day when the <ORG> re-opens. Where, however,. the provisions of the, Limitation Act apply, the proviso to s. 10(1) of the General Clauses Act in terms makes that provision itself inapplicable. Under s. 4 of the Limitation Act it is provided that where the prescribed period for any suit appeal or application expires on a day when the <ORG> is closed the suit appeal or application may be instituted preferred or made on the day when the <ORG> re-opens. The Explanation thereof states that a <ORG> shall be deemed to be closed on any day within the meaning of that section if during any part of its normal working hours it remains closed on that day. It was sought to be contended that even if the limitation Act applies s. 4 would not apply because an election petition is neither a suit, nor an appeal nor an application, notwithstanding the definition of "application" contained in s. 2(b) of the Limitation Act as including a petition. It is, in our view unnecessary to examine the submission in this context because even if s. 4 of the Limitation Act does not apply, S. 10 of the General Clauses Act will certainly apply to election petit-ions to be filed under the Act as held by this <ORG> in <CITATION> (1). In that case an election petition had to be filed under r. 119(a) 'of the Election Rules not later than fourteen days from the terminus a quo prescribed therein, but as the day on which it could be filed was a Sunday be filed it on the next day. The contention of the Solicitor-General was that s. 10 of the General Clauses Act "can apply on its own terms only when the act in question is to be done "within a prescribed period", that under r. 119(a) of the Election Rules the petition has to be filed "not later than" fourteen days, that the two expressions do not mean the same thing, the words of the Rule being more peremptory, and- that accordingly s. 10 of the General Clauses Act cannot be invoked in aid of a petition presented under r. 119, later than fourteen days". This argument was rejected as being erroneous because "Broadly stated, the object of the section is, to enable a person to do what he could have done on a holiday, on the next working day. Where, therefore, a period is prescribed for the performance of an act in a <ORG> or office, and that period expires on a holiday, then according to the section the act should be considered to have been done within that period, if it is done on the next day on which the <ORG> or office is open. For that section to apply, therefore, all that is requisite is that there should be a period prescribed, and that period should expire on a holiday." Of course s. 10(1) of the General Clauses Act does not speak of a holiday, but refers to the <ORG> or office being closed on the last day of the prescribed period to enable a party to do an act or take any proceedings on ascertain day or within a prescribed period, as the next day on which the <ORG> or office is open. If the <ORG> is closed on the day when limitation expired, s. 10(1) of the General Clauses Act enables the filing on the next working day of the <ORG>. But is the <ORG> closed on a Saturday when the Judges do not sit though the office of the High <ORG> is open?

A long course of decisions have held that a <ORG> is not closed notwithstanding the fact that Judges do not sit on any day if otherwise the <ORG> is open on that day. <NAME>, C.<NAME>, during the course of the arguments in <NAME> v. <NAME>) observed that "Saturday" is a court day although the Judges are not sitting on that day. The learned Chief Justice and <NAME> <NAME>, as he then was, (<NAME>, <NAME>, dissenting) went to the extent of holding that even in the vacations the <ORG> is not closed and money can be deposited. <NAME>, C.<NAME>, speaking for himself, <NAME>, <NAME> and <NAME>, J<NAME>, (<NAME>, <NAME>, dissenting) observed in <CITATION> (3). "The Judicial sittings of the <ORG> may be adjourned; but the offices of the <ORG> may still remain open for the presentation of pleading,-.. The <ORG> may be open for this purpose although the Judge is not engaged in judicial functions or is not present in the <ORG>-house or in the place where the <ORG> is held." A Bench of the Madras High <ORG> in In re. <NAME> and OtherS(4) dealt with a similar practice which is followed by all High <ORG>s and this.

(1) [1957] S.C.R. 208 (3) I.L.R. (1882) 5 Mad. 189 at 192.

(2) I.L.R. 19 Pat. 123.

(4) (1948) I. M. L. J. 49.

<ORG> for the summer vacation when the <ORG> close. The notifications in respect thereof specify a period between Monday to Friday both days inclusive as the vacation. The <ORG> reopens on a Saturday, but judicial work starts only on the following Monday. It was held that the first day of the <ORG> was a Saturday which was the day for receiving papers though the Judges actually sat for judicial work on Monday, as such an application, for which the prescribed period of limitation expired on Saturday the 5th when the <ORG> was open and was not filed on that day, but on Monday the 7th, was held to be barred. See also <CITATION> (1) and <CITATION> .(2).

It is, however, contended that having regard to rr. 6 and 7 of the Election Rules made by <ORG> under which an election petition has to be presented to a Judge or a Bench sitting ill open <ORG>, and since Judges do not sit on a Saturday there is no <ORG> on that day to which an election petition could be presented. We have to deal with this aspect.

At one stage the power of <ORG> to make election rules was canvassed, but ultimately the validity of the Election Rules as such was not seriously challenged, and hence it is not necessary for us to express our views in this regard. Even on the assumption that <ORG> could make the Election Rules and they are valid, do rr. 6 and 7 of those Rules warrant the submission that the <ORG> is closed on the day when the Judges do not sit, though the office of <ORG> is open? Rules 6 & 7 of the Election Rules are as follows :

"6. Subject always to the orders of the Judge, before a formal presentation of the election petition is made to the Judge in open Court, it shall be presented to the Stamp Reporter of the Court, who shall certify thereon if it is in time and in conformity with the requirements of the Act, and the rules in this behalf, or is defective and shall thereafter return the petition to the petitioner for making the formal presentation after removing the defects if any;

Provided that if on any Court day the Judge is not available on account of temporary absence or otherwise, the petition may be presented before the Bench hearing Civil applications and motions."

"7. (1) The date of presentation to the Judge or the Bench as mentioned in the proviso to rule 6 shall be deemed to be the date of the filing of the election petition for the purposes of limitation.

"(2) Immediately after it is presented, the petition shall be entered in a special register maintained for the registration of election petitions."

(1) A.I.R. 1954 Pat. 384.

(2) A.I.R. 1958 Raj. 307.

A reading of the above rules would show that-(1) the petition must first be presented to the Stamp Reporter; (2) the Stamp Reporter has to certify thereon whether it is in time and in conformity with the requirements of the Act and the rules in that behalf or is defective; and thereafter (3) the petition shall be returned to the petitioner for re- moving defects if any, and for formal presentation after removing the defects; (4) if the Judge who is designated to entertain and try election petitions is absent, the petition shall be presented before the <ORG> hearing Civil applications and motions; and (5) the date of presentation before the Judge or <ORG>, as the case may be, as provided in the proviso to r. (6) shall be deemed to be the date of filing the election petition for the purposes of limitation. It would appear from the above that the date of formal presentation to the Judge or the <ORG>, as the case may be, is. the actual date of filing the petition. what happens when on the last day of the expiry of limitation for filing the petition, though a working day for the <ORG>, if peradventure none of the Judges sit? Though in a <ORG> which has a number of Judges, such a contingency may not occur, but in a High <ORG> which consists of only one Judge such as is envisaged in the proviso to s. 80-A of the Act and that High <ORG> has rules similar to rr. 6 and 7, it would, if we accept the contention of the learned Advocate for the appellant, create an anomaly when the only Judge of the High <ORG> is absent due to illness or some other cause and the petition cannot be presented even though the <ORG> has not been closed. The appellant in these circumstances would have us say that the <ORG> is closed. But this contention has no validity, because as is submitted by the learned Advocate for the respondent that rr. 6 and 7 of the Election Rules should be read subject to r. 24 of 'the same Rules and if so read, the Patna High <ORG> Rules, in so far as they are not inconsistent with the said Election Rules, shall apply mutatis mutandis to all election petitions. A reference to r. 26 of Chapter VII Part II of these Rules which regulate.the procedure and practice before admission, would show what provision has been made in cases where appeals or applications have to be presented to a <ORG> and no <ORG> is sitting on the day when the limitation is due to expire. Rule 26 provides:

"On any <ORG> day on which no Bench is or has been sitting, any memorandum of appeal or application which might be barred by time and which is entertainable only by a Benc h may be presented to the Registrar, or, in his absence from <ORG> on that day to the Deputy Registrar, or in their absence to the Assistant Registrar, who shall certify thereon that such memorandum of appeal or application was on that day presented to him "Provided always that no such presentation to the Registrar, Deputy Registrar, or Assistant Registrar, shall be of any effect, unless such memorandum of appeal or application be presented to a Bench on the next subsequent day on which a Bench is sitting It was, however, contended by the learned Advocate for the appellant, though on a farther consideration he did not think that he could sustain it, that r.26 makes a reference to an application and not to a petition : as such that rule is in applicable to an election petition Since it has been raised, we can only say that such an argument would be misconcieved because r. 1 of Chapter III Part 11 states that every application to the High <ORG> shall be by a petition written in the English language, rr. 2 to 10 further require what the petition should state, that it should be verified, how it should be entitled, what it should be accompained with etc. By these rules which have been made applicable to election petitions by r. 2 of the Election Rules, whenever an application has to be made to a High <ORG>, it should be made by a petition, so that there is no warrant for the submission that r. 26 does not deal with a petition, but only with an application.

It is further submitted that r. 26 has no application as it is inconsistent with r. 7 because under the latter rule the date of presentation to a Judge or a <ORG> is deemed to be the date of the filing of the election petition for the purpose of limitation, but r. 26 provides for the presentation to the Registrar etc. and after certification it is to be presented to a <ORG> on. the next subsequent day on which the <ORG> is sitting. If that is the day for limitation, the learned advocate submits then no other day on which it is not presented to a Judge can be considered to be the day for limitation. If so, the presentation before the Registrar would be inconsistent with the requirements of r. 7. In our view, there is nothing inconsistent in rr. 6 and 7 of the election Rules and r. 26 of the Patna High <ORG> Rules, because r. 7(1) does not provide for a situation where the Judges do not sit and the period prescribed is deemed to expire on that day. It may be that the presentation to the Jadge will be the date of filing for the purposes of limitation, but that does not excuse a different procedure for filing in a case where limitation is about to expire, when the conditions prescribed in the proviso to r. 6 of the Election Rules cannot be complied with. If r. 7(1) of the Election Rules had stated that the date of presentation to the Judge shall be deemed to be the date of the filing of the election petition for the purpose of determining whether the petition is barred by time, then such a provision could be said to be inconsistent with r. 26 of the High <ORG> Rules. But that is not the case here. What r. 7(1) provides if that the date of presentation to a Judge or a <ORG> as mentioned in the proviso to r. 6 which contemplates the presentation of. a petition before a <ORG> hearing Civil applications and motions on a court day, when a Judge is not available on account of temporary absence or otherwise, but it does not provide for a contingency where a Judge or a <ORG> sitting on any other day when the <ORG> is not closed. That contingency is provided for by r. 26. In our view, there is nothing inconsistent in rr. 6 and 7 of the Election Rules and r. 26 of the High <ORG> Rules. If as the practice of the High <ORG> is that Judges do not sit for judicial work on a Saturday, there are no <ORG>es sitting on that day and consequently any provision made to deal with such a contingency could not be said to be inconsistent with the Election Rules. This conclusion is further reinforced by a reference to r. 13 of Chapter 11 part I of the Patna High <ORG> Rules whereun-

der the Registrar has power to receive an appeal under clause 10 of the Latters Patent, to receive an application for probate or Latters of Administration or for revocation of the same and to issue notices thereon, to receive a plaint or an appeal from the decree or order of a Subordinate Civil <ORG> etc. Rule 27 provides for the contigency when the Registrar is absent on the last day of limitation when such documents have to be filed. These Rules are consistent with the postulate that the <ORG> is not in fact closed on a Saturday even though the Judges may riot sit on that day. It would, in our view be incongruous that a <ORG> is open on Saturday for presentation of appeals, applications, plaints or decrees etc.mentioned in r.13 of part I of Chapter ll referred to above even though the Judges are not sitting on that day, and yet closed on that same day for presentation of election petition. In our view, therefore, reading rr. 6 and 7 with r. 26, there can be no manner of doubt that an election petition can be presented on the last day of limitation even when the Judges are not sitting to receive or entertain an election petition to the Registrar or in his absence to the other officers specified in r.26. Infact the Patna High <ORG> had, on a similar point, held nearly seven years ago in Md. <NAME> and others v. <NAME> and others, (1) a copy of which has been placed before us, that where under r. 13 Part 11, Chapter VII, it is provided that application for review must be presented by way of notice in open court to the Bench of whose judgment a review is sought, it could be filed on a Saturday if it is the last day of limitation. An argument similar to that addressed by the learned Advocate for the appellant was rejected on the ground that Saturday was a working day and that r.26 clearly refers to a Saturday on which no Benches sit.

Now that we have held that the <ORG> is not closed and the petition could have been presented to the Registrar on Saturday, March 18, 1972, the question would be, does s. 5 of the Limitation Act apply to enable the petitioner to show sufficient cause for not filing it on the last day of limitation, but on a subsequent day? Whether s.5 is appli- cable to election petitions filed under s. 81 of the Act will depend upon the terms of s. 29(2) of the Limitation Act. Whether s. 5 could be invoked would also depend on the applicability of sub-s. (2) of s. 29 of the Limitation Act to election petitions. Under this sub-section where a special or local law provides for any suit, appeal or application a period different from the period prescribed therefor by the Schedule, the provisions specified therein will apply only in so far as and to the extent to which they are not expressly excluded by such special or local law. Under s. 29(2) of the Limitation Act of 1908 as amended in 1922, only s. 4 , ss. 9 to 18 and s. 22 of that Act applied ordinarily useless excluded by a special or local law. Thus unless s. 5 was made applicable by or under any enactment the discretion of the <ORG> to extend time thereunder would not be available. Similarly ss. 6 to 8 would not apply and neither acknowledgement nor payment (under the former ss.19 and 20) could give a fresh starting point of limitation. Even s. 5 under the old Act was in terms inapplicable to applications unless the section was made applicable by or under any of the enactment. The new s. 5 is now of wider applicabi-

lity and as the objects and reasons state "Instead of leaving it to the different States or the High Courts to extend the application of section 5 to applications other than those enumerated in that section as now in force, this clause provides for the automatic application of this section to all applications, other than those arising under Order 21 of the Code of Civil Procedure, 1908, relating to the execution of decrees. In the case of special or local laws, it will be open to such laws to provide that section 5 will not apply." The present section incorporates two changes : (1) a uniform rule making it applicable to all applications except those mentioned therein (by defining "application" as including a "petition" in s. 2(b) ; and (2) to all special and local enactments, unless excluded by any of them. The difference in the scheme of the provisions of sub-s. (2) of s. 29 under the two Acts will be discernible if they are juxtaposed as under.

s. 29,(2) of old Act Where any special or local- law prescribes for any suit, appeal or application a period of limitation different from the period prescribed by the Schedule, the provisions of section 3 shall apply, as if such period were the period prescribed by the Schedule and for the purpose of determining any period of limitation prescribed for any suit, appeal or application by any special or local law, the provisions contained in sections 4 to 24 (inclusive) shall apply only in so far as. and to the extent to which, they are not expressly excluded by such special or local law.

(a) the provisions contained in section 4 , sections 9 to 18 , and section 22 shall apply only in so far as and to the extent to which, they are not expressly excluded by such special or local law; and

(b) the remaining provisions of this Act shall not apply. s. 29(2) of new Act Where any special or local law prescribes for any suit, appeal or application a period of limitation different from the period prescribed therefor by the First Schedule, the provisions of section 3 shall apply, as if such period were prescribed therefor in that Schedule, and for the purpose, of determining any period of limitation prescribed for any suit, appeal or application by any special or local law. It will be noticed that under the 1908 Act there are two limbs(1) that where any special or local law prescribes for any suit, appeal or application a period of limitation different from the period prescribed therefor by the First Schedule', the provisions of s. 3 shall apply as if such period were prescribed therefor in that Schedule; and (2) for the purpose of determining any period of limitation prescribed for any suit, appeal or application by any special or local law, the provisions contained in s. 4 , ss. 9 to 18 and s. 22 shall apply only in so far as, and to the extent to which, they are not expressly excluded by such appeal or local law. The, remaining provisions of that Act, are by virtue of clause (b) of sub-s. (2) inapplicable. The two limbs of sub.s (2) are connected with the conjunction "and" and the question has been debated and there has been a cleavage of opinion as to whether those two limbs are independent or have to be read cumulative]-,, and as an integrated whole. The decision of <ORG> in <CITATION> (1) has by a majority held that both parts of s. 29(2) of the old Act should be read as one whole and the conjunction "and" would have to be read as importing into what follows it, the conditions set out earlier and that the words following the conjunction "and" attract the conditions laid down by the opening words of the sub-section. This case was considering the applicability of s. 12(2) to appeals under s. II 6 A of the Act , which had provided a time limit for filing an appeal, but the first Schedule to the limitation Act had not provided any. Even the absence of a provision prescribing, a time limit in the first Schedule was considered, by the majority as prescribing a different period be cause when the First Schedule prescribes no time limit for a particular appeal but the special law prescribes a time limit for it, prescribes a period different from that prescribed in the former. Where once the special or local law has provided a period different from that prescribed in-the Schedule to the limitation Act, sub-s. (2) of s. 29 stands directly attracted and s. 3 and other section shall apply in so far as, and to the extent to which, they are not expressly excluded by such special or local law. Though <NAME>, C.<NAME>,and <NAME>, <NAME>, agreed with <NAME>, <NAME> as he then was, that even, where the First Schedule did not prescribe a period of limitation for an appeal which is different from that prescribed in the special or local law the sub-section applied, and even if it is assumed that for the application of s.29(2) a period that is different has to be prescribed for an identical appeal, then Art. 156 prescribes a different period, they did not agree with him, that the second limb of sub-s(2) is ail independent provision providing for that category of proceedings to which the first limb does not apply. <NAME>, C.<NAME>, Rajagopala <NAME> and <NAME>, J<NAME>, by majority held that the entire sub-s (2) of s. 29 of the Limitation Act has to be read as an integrated provision and the conjunction "and" connects the two parts and makes it necessary for attracting cl. (a) that the conditions laid down by the opening word of sub-s. (2) should be satisfied. <NAME> and <NAME>, J<NAME>, also did not agree with the majority that where a right of appeal is given by, some other law, the appeal must be regarded as the one under the Code of Civil Procedure, inasmuch as the words under the Code of Civil Procedure cannot be read as meaning "governed in the matter of procedure by the Code of Civil Procedure". <NAME> and <NAME>, J<NAME>, held that the second limb of sub-s. (2) of s. 29 is wide enough, to include a suit, appeal or an application under a special or local law which is of a type for which no period of limitation is prescribed in the First Schedule. In the result, <NAME>, C.<NAME>, <NAME>, <NAME> and Rajagopala <NAME>, J<NAME>, held that the exclusion of time provided for by s. 12 of the limitation Act is permissible in computing-, the period of limitation for filing an appeal in <ORG> under s. 116A of the Act.

It was contended before us that the majority decision required reconsideration by a larger Bench, because a period of limitation which is (1) [1964]6 S.C.R. 129.

different from that prescribed in any special or local law would mean ,that the Limitation Act should provide for a definite period which is different from that prescribed in the special or local law, a view which was taken by <NAME>, J., in that decision. We do not think this would be a proper course, because in our view the matter was fully argued and considered by this Court, and while a different view can be taken, the need for certainty particularly in a matter concerning limitation where litigants have to be guided, the legal position should not be in doubt, when it is consistent with the view taken by this Court in ..other cases.

Secondly, <NAME> case (supra) is one which dealt with an appeal under the Act while what we have to consider is whether the Limitation Act is at all applicable to election petitions under the Act. Thirdly, s. 29(2) of the new Limitation Act does not now give scope for this controversy whether the two limbs of the old section are independent or integrated. No doubt s. 5 would now apply where s, 29(2) is applicable to even applications and petitions, unless they are .-expressly excluded. Even assuming that the Limitation Act applies to ,election petitions under the Act, what has to be seen is whether s. 5 is ,excluded from application to such petitions. It has already been noticed that <NAME> case has made s. 12(2) applicable to appeals under s. 116A of the Act. The proviso to that section confers power similar to that conferred by s. 5 . Even in appeals to <ORG> under s. 417 of the Code of 'Criminal Procedure it has been held in <CITATION> (1) that s. 12 of the new Limitation Act will apply. On the ratio of <NAME> case even where the Limitation Act has not pres- cribed the period of limitation in the Schedule different from that prescribed under s. 81 of the Act, sub.-s. (2) of s. 29 will be attracted and that position is not any the less different under the new Limitation Act . <NAME> case is, however, decisive for attracting sub-s. (2) of s. 12 to an appeal under s. 116A of the Act as there was nothing in that section to preclude its application. <CITATION> (2) again is a case in which the question of application 'of s. 12(2) of the Limitation Act to the ,computation of the period of limitation prescribed in s. 116A of the Act in respect of an order delivered by <ORG> on December 28, 1966, was considered. After excluding the time taken for obtaining a certified copy of the order by the respondent just before the <ORG> closed for the summer recess, the memorandum of appeal 'Could only be lodged on the re-opening of the <ORG>. Following the 'decision in <NAME> case this <ORG> held that ss. 4 and '12 of the Limitation Act would apply, because "There is no provision in the Representation of the People Act , 1951, which excludes the ,-application of s. 4 of the Limitation Act." In <NAME> case(1) to which a reference has been made already, ..a Bench of this <ORG> to which one of us was a party (P. <NAME> (1)2 S.C.R. 898.

(2) [1971] 1 S.C.R. 8.

<NAME>, J.) considered the applicability of s. 12 of the Limitation Act to an application under s. 417(3) of the Code of Criminal Procedure. In that case an application for leave to appeal to <ORG> was filed under sub-s. (3) of s. 417 of the Code. of Criminal Procedure against an order of acquittal by a Magistrate. It was claimed that two days were necessary for obtaining the certified copy of the order of the Magistrate and the application would be in time if these two days were deducted. <ORG> accepted the appeal and convicted the appellant. in appeal to this Court against his conviction the appellant contended that the period of 60 days mentioned in s. 417(4) was not a period of limitation within the meaning of s. 12 of the Limitation Act and that the sub-section barred the jurisdiction of <ORG> to deal with the application if a period of 60 days bad expired from the date of the order of acquittal. It was held that the application to <ORG> was within time. It was, however, urged that s. 417(4) contains a prohibition that no application under sub- s. (3) shall be entertained by <ORG> after the expiry of 60 days from the date of the order of acquittal and consequently the jurisdiction of <ORG> to entertain such applications for leave to appeal is barred. The Court rejected the contention and relying on the case of <CITATION> (1) as well as on <CITATION> (2) observed at p. 901 "It is quite clear that the Full Bench of <ORG> and this Court proceeded on the assumption that s. 417(4) of the Criminal Procedure Code prescribes a period of limi- tation. The learned counsel, however, contends that there was no discussion of this aspect. Be that as it may, it seems to us that s. 417(4) itself prescribes a period of limitation for an application to be made under s. 417(3) . It was not necessary for the legislature to have amended the limitation Act and to have inserted an article dealing with applications under s. 417(3) , Cr. P.C.; it was open to it to prescribe a period of limitation in the Code itself."

The basis of this decision is that sub-s. (4) of s. 417 of the Code of Criminal Procedure is not in a negative form as contended for by the learned Advocate in that case, but that it has a positive content for performing an act and it prescribes a definite period within which an act has to be done.

<CITATION> .(3) to which we shall refer more fully later, <NAME> case (supra) was attempted to be pressed into service, but this. Court repelled it and observed at pp. 688-689:

"In our View, the situation now obtaining in an appeal to this Court from an order of <ORG> is entirely different. There is no section in the Act as it now stands which equates an order made by <ORG> under s. 98 or s. 99 to a decree (1)  4 S.C.R. 982.

(2) I.L.R. [1961] Bom.135, 137.

(3) [1969] 1 S.C.R. 679.

passed by a Civil court subordinate to <ORG>. An appeal being a creature of a statute, the rights conferred on the appellant must be found within the four corners of the Act. Sub-s. (2) of the present s. 116A expressly gives this <ORG> the discretion and authority to entertain an appeal after the expiry of the period of thirty days. No right is however given to <ORG> to entertain an election petition which does not comply with the provisions of s. 81 , s. 82 or s. 117 .

Though s. 29(2) of the Limitation Act has been made applicable to appeals both under the Act as well as under the Code of Criminal Procedure, no case has been brought to our notice where s. 29(2) has been made applicable to an election petition filed under s. 81 of the Act by virtue of which either ss. 4 , 5 or 12 of the Limitation Act has been attracted. Even assuming that where a period of limitation has not been fixed for election petitions in the Schedule to the Limitation Act which is different from that fixed under s. 81 of the Act, s. 29 (2) would be attracted, and what we have to determine is whether the provisions of this section are expressly excluded in the case of an election petition. It is contended before us that the words "expressly excluded" would mean that there must be an express reference made in the special or local law to the specific provisions of the Limitation Act of which the operation is to be excluded. As usual the meaning given in the Dictionary has been relied upon, but what we have to see is whether the scheme of the special law, that is in this case the Act, and the nature of the remedy provided therein are such that the <ORG>, intended it to be a complete code by itself which alone should govern the several matters provided by it. If on an examination of the relevant provisions it is clear that the provisions of the Limitation Act are necessarily excluded, then the benefits conferred therein cannot be called in aid to supplement the provisions of the Act. In our view, even in a case where the special law does not exclude the provisions of ss. 4 to 24 of the Limitation Act by an express reference, it would nonetheless be open to the <ORG> to examine whether and to what extent the nature of those provisions or the nature of the subject-matter and scheme of the special law exclude their operation. The provisions of s. 3 of the Limitation Act that a suit instituted, appeal preferred and application made after the prescribed period shall be dismissed are provided for in s. 86 of the Act which gives a peremptory command that the High <ORG> shall dismiss an election petition which does not comply with the provisions of ss. 81 , 82 or 117. It will be seen that s. 81 is not the only section mentioned in s. 86 , and if the Limitation Act where to apply to an election petition under s. 81 it should equally apply to ss. 82 and 117 because under s. 86 the High <ORG> cannot say that by an application of s. 5 of the Limitation Act, s. 81 is complied with while no such benefit is available in dismissing an application for non-compliance with the provisions of ss. 82 and 117 of the Act, or alternatively if the provisions of the Limitation Act do not apply to s. 82 and s. 117 of the Act, it cannot be said that they apply to s. 81 . Again, s. 6 of the Limitation Act which provides for the extension of the period of limitation till after the disability in the case of a person who is either a minor or insane or an idiot is inapplicable to, an election petition. Similarly, ss. 7 to 24 are in terms inapplicable to the proceedings under the Act, particularly in respect of the filing of election petitions and their trial. It was sought to be contended that only those provisions of the Limitation Act which are applicable to the nature of the proceedings under the Act, unless expressly excluded, would be attracted. But this is not what s. 29(2) of the Limitation Act says, because it provides that ss. 4 to 24 (inclusive) shall apply only in so far as, and to the extent to which, they are not expressly excluded by such special or local law. If none of them are excluded, all of them would become applicable. Whether those sections are applicable is not determined by the terms of those sections, but by their applicability or inapplicability to the proceedings under the special or local law. A person who is a minor or is insane or is an idiot cannot file an election petition to challenge an election, nor is there any provision in the Act for legal representation of an election petitioner or respondent in that petition who dies, in order to make s. 16 of the Limitation Act applicable. The applicability of these provisions has, therefore, to be judged not from the terms of the Limitation Act but by the provisions of the Act relating to the filing of election petitions and their trial to ascertain whether- it is a complete code in itself which does not admit of the application of any of the provisions of the Limitation Act mentioned in s. 29(2) of that Act. <ORG> of this <ORG> had in <CITATION> (1) considered the provisions of the Act to determine whether any thing connected with the elections can be questioned at an intermediate stage. In that case the rejection of a nomination of a candidate in an election under the Act was sought to be challenged by a petition under Art. 226 of the Constitution. After examining the various provisions of the Act, <NAME>, J., observed at p. 231 that "it should be noted that there is no provision anywhere to the effect that anything connected with elections can be questioned at an intermediate stage." Again at p. 234 it was observed:

"If Part XV of the Constitution is a code by itself, i.e. it creates rights and provides for their enforcement by.a Special tribunal to the exclusion of all courts including <ORG>, there can be no reason for assuming that the Constitution left one small part of the election process to be made the subject- matter of contest before <ORG>s and thereby upset' the time schedule of the elections."

The observations that the provisions of the Act are a self- contained code were also made in the case of <NAME> referred to earlier. In that case, in a trial of an election petition after the issues were framed the appellants made an application to the <ORG> for impleading one R but it was dismissed. The first respondent then filed an application under s. 86(1) praying for the dismissal of the election (1)  S.C.R. 218.

petition on the ground that there had been non-compliance with s. 82(b) of the Act inasmuch as R against whom corrupt practice had been alleged had not been made a party. The appellants filed an application seeking to withdraw the allegation against R and in the alternative to implead him as a respondent. It was also prayed that delay in making the application may be condoned. The learned Judge of <ORG> trying the election petition dismissed the aforesaid applications and refused to condone the delay. One of the contentions urged in the appeal was that s. 5 and s. 29(2) of the Limitation Act , 1963, were applicable to the case and <ORG> and this Court had power to condone the delay made by the election petitioner in impleading a necessary party. This plea was rejected. <NAME>, J., delivering the judgment of this Court for himself and <NAME>, <NAME>, after examining the relevant provisions of the Act in detail at pp. 682-686 observed at pp. 686-687 :

"it is well settled that amendments to a petition is a civil proceeding and the addition of parties to such a proceeding are generally possible subject to the law of limitation. But an election petition stands on a different footing. The trial of such a petition and the powers of the court in respect thereof are all circumscribed by the Act. The Indian Limitation Act of 1963 is an Act to consolidate and amend the law of limitation of suits and other proceedings and for purposes connected therewith. The provisions of this Act will apply to all civil proceedings and some special criminal proceedings which can be ,taken in a court of law unless the application thereof has been excluded by any enactment: the extent of such application is governed by s. 29(2) of the Limitation Act. In our opinion however the Limitation Act cannot apply to proceedings like an election petition inasmuch as the Representation of the People Act is a complete and self-contained code which does not admit of the introduction of the principles or the provisions of law contained in the Indian Limitation Act ."

It would be a mere repetition again to refer to the provisions which were examined in much detail in that case except to notice that sub-s. (5) of s. 86 gives a latitude to the petitioner upon such terms as to costs and otherwise as <ORG> may deem fit to amend the particulars of any corrupt practice alleged in the petition and amplify it in such manner as may in its opinion be necessary for ensuring a fair and effective trial of the petition, but <ORG> shall not allow any amendment of the petition which will have the effect of introducing particulars of a corrupt practice not previously alleged in the petition. Now here is a definite indication that s. 5 of the Limi- tation Act cannot be attracted, because no new corrupt practice not previously alleged in the petition can be allowed by way of an amendment. If this is not permitted, it is because any introduction of new particulars of a corrupt practice not previously alleged in the petition would have altered the structure of the petition and would amount to a new petition being filed after the period of limitation, which is, what is expressly prohibited.

It is also significant that delay in the presentation of the election, petition under the repealed s. 81 could be condoned by <ORG> in its discretion under the proviso to the repealed s. 85 , of the Act. But there was nothing in s. 85 which permitted <ORG> to condone the non-compliance with the provisions of s. 117 of the Act. When the Act was amended and the jurisdiction was given to <ORG> to entertain and try election petitions, a provision similar to the proviso for condoning delay was not enacted. This omission definitely expresses <ORG>'s intention not to confer the power to condone any delay in the presentation of the petition.. The whole object of the amendment in 1966 was to provide a procedure for a more expeditious disposal of election disputes, which experience had shown had become dilatory under the former procedure where election trials were' not concluded even after five years when the next elections were held, notwithstanding the fact that every petition was, enjoined to be tried as expeditiously as possible and endeavour was. required to be made to conclude the trial within six months from the date on which the election petition was presented to <ORG> for trial. <CITATION> (1) two of us (<NAME> and <NAME>, JJ), while holding that s. 82(b) of the Act was mandatory, the failure to comply with which was fatal to the maintainability of the, petition. said (p. 769):

Apart from ensuring the purity of elections, and finality in regard to all election matters, one other consideration, seems, to be the expeditious disposal of election petitions. Before the amendment of Section 82 by Act 27 of 1956 the unamended section made it incumbent on a petitioner "to join as respondents, to his petition all candidates who were duly nominated at., the election other than himself, if he was so nominated." The reason for the amendment of Section 82 has been stated in the notes on clauses to the Amendment Bill No. 33 of' 1955 to be that the section as it stands holds up the trial of an election. petition because of the difficulty in serving a notice on all those who have been nominated. It is further stated: "Naturally, it is only the returned candidate who takes any interest in contesting the election petition. Moreover, there is a provision in Section 90 which enables any other candidate to join as a respondent. It is accordingly proposed in this clause that Section 82 should be revised so that it is necessary to join as respondents only those candidates who are interested prima facie in the outcome of the petition". After the amendment the candidates under clause (b) of Section 82 are not impleaded merely,, because they are necessary parties in an election petition in which a declaration is sought that the election of all or any of' the candidate would be void, but are impleaded as parties. because there are allegations of corrupt practices against them in the election petition. Where action is taken under Section 90 (1) 2 S.C.R. 759.

an order under Section 98 of the Act dismissing the election petition or declaring the election of all or any of the returned candidates to be void and/ or declaring the petitioner or any other candidate to have been duly elected, would delay the disposal of the election petition, because notice will have to be given to all the persons named under the proviso to sub-clause (ii) of clause (a) of sub-section (1) of Section 99 . The provisions Of Section 82(b) would avoid any such delay as they make it obligatory for a person filing an election petition when he makes an allegation of corrupt practice against any candidate to make him a 'party on pain of the petition being dismissed under Section 86(1) if he omits to do so."

It is interesting to see that although <ORG> ,did not recommend what provisions of the Act should be amended, it nonetheless in its Report on the Third General Elections in India (1962) Volume I (General), after noticing the several causes of delay reported in its summary of recommendations under the heading 'Election petitions' at p. 125 as under:

"(i) The objective of a quick decision of election disputes can only be achieved by placing the responsibility directly on the high Courts. Every election petition should be presented to <ORG> in which the election was held ,and tried by a permanent Judge on the rota for the trial of such petitions.

(ii) Clause (1) of article 324 of the Constitution should 'be amended by omitting the words "including the appointment of election tribunals for the decision of doubts and disputes arising out of or in connection with election to <ORG> and to the Legislatures of States", simultaneously with the amendment of the election law providing for the trial of election petitions directly by the High Courts."

-This summary supports the above observations in the judgment.

<CITATION> ,(1) it was held that there is no question of any common law right to challenge an election as such any discretion to condone the delay in presentation of the petition or to absolve the petitioner from payment of security ,for costs can only be provided tinder the statute governing election ,disputes. It was observed that if no discretion was conferred in respect of any of these matters, none can be exercised under any general law or on any principles of equity. If for non- compliance with the provisions of ss. 82 and 117 which are mandatory, the election petition has to be dismissed tinder s. 86(1) the presentation of election petition ,within the period prescribed in F. 81 would be equally mandatory, ;the noncompliance with Which visits the penalty of the petition being .dismissed. The answer to the plea that if the petition were to be dismissed, allegations of serious corrupt practices cannot be required into and the purity of the elections cannot be maintained is that given by Mitter J., in <NAME> case (<NAME>) where he said at P.689 "That is however a matter which can be set right only by the <ORG>. It is worthy of note that although the Act has been amended on several occasions, a provision like s.

86(1) as it now stands has always been on the statute book but whereas in the Act of 1951 the discretion was given to <ORG>, to entertain a petition beyond the period fixed if it was satisfied as to the cause for delay no such saving clause is to be found now. The legislature in its wisdom has made the observance of certain formalities and provisions obligatory and failure in that respect can only be visited with a dismissal of the petition."

Since the above decision in <NAME> case (supra) in August 1968, though <ORG> has made certain amendments in s. 8 of the Act in 1969, it has not considered it necessary till now to amend the Act to confer, on persons challenging an election, benefits similar to those available to them under the proviso to the repealed s. 85 of the Act, for as we venture to think, it did not want delays to occur in the disposal of election petitions as in the past. For all these reasons we have come to the conclusion that the provisions of s. 5 of the Limitation Act do not govern the filing of election petitions or their trial and, in this view, it is unnecessary to consider whether there are any merits in the application for condonation of delay. The appeal as well as C.M.P. No. 7820 of 1973 are accordingly dismissed but in the circumstances without costs.

V. P. S. Appeal dismissed. 5-M 852 Sup :1/74