State of Tamil Nadu vs K.R. Selvamoorthy

The defendant in the suit is the appellant. The plaintiff is the respondent. The plaintiff laid the suit for recovery of amounts deposited by him with

the defendant under an agreement. That agreement was broken, and the defaulter was found to be the plaintiff. There was an earlier suit to maintain

the agreement and that was dismissed; and one of the grounds of dismissal was lack of notice under S. 80, CPC. The plaintiff relied on S. 14 of

the Limitation Act, stating that the earlier suit was prosecuted in good faith and the court, apart from other grounds, could not entertain it for want

of notice under S. 80, C.P.C. The case of the plaintiff has been countenanced by the two courts below. In this second appeal directed against the

judgment and decree of the lower appellate court, the two substantial questions of law formulated by this court at the time of the admission of this

second appeal run as follows -

Whether in the light of the conditions in the tender form as accepted by the plaintiff, the plaintiff is entitled to recover the lease amount which is

liable to be forfeited in case the plaintiff did not work out the lease within the particular period?

Whether the court below was justified in holding that the provisions of S. 14 of the Limitation Act saved the present suit?

So far as the first question is concerned, it has got to be answered against the defendant in view of the pronouncement of the Supreme Court in

Union of India (UOI) Vs. Rampur Distillery and Chemical Co., Ltd., wherein it has been held as follows

The party to a contract taking security deposit from the other party to ensure due performance of the contract is not entitled to forfeit the deposit

on ground of default when no loss is caused to him in consequence of such default.

Admittedly, no loss caused to the defendant was either pleaded or proved.

Coming to the second question, it stands answered by a pronouncement of a Bench of this court consisting of Oldfield and Sadasiva Aiyar, JJ.

in KannU.SWarni v. Jagathambal, AIR 1919 Mad 1071 (2), and Sadasiva Aiyar, J. observed as follows-

I might state that even where in the same clause of the same sentence in the Limitation Act, S. 14, the words ''other cause'' followed again by the

express words ''of a like nature'' were inserted after the words ''defect of jurisdiction'', the courts have given a very liberal interpretation to the

words ''other cause'' as including cases where the suit failed for want of a prior notice under Sec. 80, C.P.C. or where it was brought without

proper leave of the court or without production of the Collector''s certificate required by S. 6, Pensions Act.

The earlier suit had to fail and did fail for want of notice under S. 80, C.P.C. though other grounds were also found against the plaintiff. The bone

of contention in both the suits stemmed out of the agreement between the parties and it was one and the same. It is not the finding of the Courts

below that the plaintiff lacked good faith when he laid and prosecuted the earlier suit. Hence, the two substantial questions of law are against the

defendant. Accordingly, the second appeal fails and the same is dismissed. No costs.

Appeal dismissed.