DHANRAJ MILLS LTD Vs. LAXMI COTTON TRADERS

JUDGEMENT

(1.) A very interesting question relating to the law of limitation arises on his appeal and the question becomes more interesting because it has not been decided definitely by any High Court whose decisions have been referred to at the bar and the question arises in this way. The respondents entered into a contract with the appellant-mills on the 5th of December, 1950. The contract was headed "Provisional Sale Note" and under this contract the respondents agreed to buy from the appellants certain bales of cotton goods for February-March delivery against confirmed quota to be confirmed within 30 days, U. K. Mill delivery. On the next day, the respondents paid to the appellants a sum of Rs. 3,500 and the appellants passed a receipt in respect of this amunt stating that the amount was payment against fulfilling the contract. It appears that the respondents could not obtain the necessary quota for exporting the goods to the United Kingdom for which the goods were intended, and, therefore they did not carry out the terms of the contract. On the 19th of October. 1951, they wrote to the Mills that as there was no possibility of their getting quota for export of the piece-goods to the United Kingdom, they would thank the Mills to treat the contract as cancelled and refund the deposit of Rs. 3,500. As the Mills refused to return the deposit, the respondents filed a suit for the return of his deposit from which this appeal arises.

(2.) The appellants' contention was that the plaintiffs' siot was barred by limitation and also on the merits that the contract entered into between the parties was not a provisional contract, that the plaintiffs had undertaken an obligation to purchase cotton goods from the Mills and having failed to do so, they were in default and therefore, were not entitled to the return of the deposit. On both the points, the learned Judge held against the defendants and passed a decree in favour of the plaintiffs and the question that has been argued before us is the question of limitation. The view taken by the learned Judge was that the case fell under the residuary Article 120. Now, it is clear that one should not have resort to Article 120 unless one is satisfied that no other article in the Limitation Act applies to the fact of a case. Article 120 by its very terms is a residuary article and only applies to a case when other articles have no application, and Mr. Shah for the plaintiffs before us hs argued on the basis that the article which applies to the facts of this case is Article 145 and the period of limitation is six years.

(3.) Now, turning to that article, the description of th suit in respect of this article is 'against a depository or pawnee to recover meveable property deposited or pawned' and the time from which limitation begins to run is the date of the deposit or pawn. What is urged by Mr. Shah is that the case of every deposit falls under this article and inasmuch as the present suit is to recover a deposit made by the plaintiffs,the period of limitation must be governed by this article. Therefore, the question that we have to consider and decide is this; When a party has gven a deposit for the due performance of a contract and sues the other party to the contract to recover that deposit, does that case fall within the ambit of Art. 145?