Doctrine of merger and exclusion of bona fide writ time saved a refund claim from limitation.

Where special leave is granted and the appeal is entertained, the impugned order loses finality by merger, so limitation for a consequential civil claim is computed from the Supreme Court's final determination rather than the original tribunal order. The Court also accepted exclusion of time spent in bona fide prosecution of a writ petition before a forum that declined to entertain it, under the Limitation Act. On that approach, a suit for refund based on an earlier declaration was not time-barred. The prior view in P.K. Kutty was held incorrect and overruled.

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Issues: Whether the suit for refund of excess freight was barred by limitation, and whether the period during which the special leave petition and the writ petition were pending could be excluded while computing limitation.

Analysis: The suit was not one for a fresh declaration but one for refund based on the declaration already obtained before the Tribunal. Once special leave was granted and the appeal was entertained, the Tribunal's decision was in jeopardy and the doctrine of merger applied, so the cause of action and final enforceability had to be reckoned from the Supreme Court's final decision, not from the original tribunal order. The Court also held that the period spent in bona fide prosecution of the writ petition before the High Court, which declined to entertain it, was liable to be excluded under the Limitation Act. In that setting, the suit could not be treated as time-barred. The prior decision in P.K. Kutty was held not to lay down the law correctly and was overruled.

Conclusion: The suit was within limitation and not barred by time.

Final Conclusion: The limitation question was answered in favour of the respondents, and the appeals were left to be decided on merits by an appropriate Bench.

Ratio Decidendi: Once special leave is granted and the appeal is entertained, the impugned order loses finality by merger, and limitation for a consequential civil claim must be computed with reference to the final appellate determination, subject to exclusion of time spent in bona fide prosecution before a forum that declines to entertain the matter.

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