1994 (5) TMI 267 - SC - Indian Laws

Government negligence claim falls under Article 120 not Article 36 of Limitation Act 1908

The SC held that a negligence claim was governed by Article 120 rather than Article 36 of the Limitation Act, 1908. The court determined that Article 36 ... Claim of damages founded on negligence - Applicability of the period of limitation as provided in Article 36 of the Limitation Act, 1908 - grant of certificate under Article 133(1)(a) of the Constitution - Rule of strict liability as enunciated in Rylands v. Fletcher - scope of malfeasance, misfeasance and nonfeasance - HELD THAT:- Liability in tort may arise as observed by Salmond without fault. The basic ingredients of torts, namely, injury and damage due to failure to observe duty has been found to have been established. In the conservative sense it was negligence. But in modern sense and present day context it was not only negligence but mistake, defective planning, failure to discharge public duty. It was thus tort not in the narrow sense but in the broader sense to which Article 120 applied. The suit, therefore, could not be thrown out as it was filed beyond two years from the date the incident took place. The substantial question of law if Article 36 was exhaustive of all torts is thus answered in the negative. Further the rule in Rylands v. Fletcher' has not been modified by our Court in Modern Cultivators2. And the article of Limitation Act applicable to the facts of the case was Article 120 and not Article 36. The computation for purposes of limitation under Article 36 could commence either from the date when malfeasance, misfeasance or nonfeasance occurred or from the date when the damage took place or where claim is lodged within period allowed by law and the damage is ascertained then from the date the claim is rejected. It is the improper performance of duty or arbitrary action of the authorities in not accepting the claim when damage was found by the Official Committee to have taken place. The limitation to file the suit on facts of this case arises from the date the Government refused to pay the amount determined by the Committee. Since the rejection was not communicated nor the copy of the report was supplied despite request the suit could not be said to be barred by time. In the result, this appeal succeeds. The decree and order passed by the two courts below are set aside. The suit of the appellant for ₹ 1,58,735, the amount of damage determined by the trial court which was neither appealed from nor objected to by the respondent is decreed with costs throughout. Issues Involved:1. Applicability of Article 36 of the Limitation Act, 1908.2. Rule of strict liability as enunciated in Rylands v. Fletcher.3. Negligence in the planning and construction of the bundh.4. Computation of the period of limitation.Summary:1. Applicability of Article 36 of the Limitation Act, 1908:The High Court granted a certificate under Article 133(1)(a) of the Constitution of India, raising a substantial question of law about the applicability of the period of limitation as provided in Article 36 of the Limitation Act, 1908, to a claim of damages founded on negligence. The High Court framed the issue as whether Article 36, Article 39, or the residuary Article 120 applies to the case. The trial court dismissed the suit as barred by time, applying Article 36, which provides a two-year limitation period for compensation for any malfeasance, misfeasance, or nonfeasance independent of contract. The third Judge held that Article 36 applied, and the suit was barred by limitation. The Supreme Court, however, concluded that Article 36 was not exhaustive of all torts and that the suit was not barred by time under Article 120, which allows a six-year limitation period.2. Rule of Strict Liability as Enunciated in Rylands v. Fletcher:The High Court was divided on whether the rule of strict liability as enunciated in Rylands v. Fletcher and modified by the Supreme Court in State of Punjab v. Modern Cultivators applied to the facts of the case. The third Judge held that the rule of strict liability had not been modified by the Supreme Court and was not applicable to the present case. The Supreme Court affirmed that the rule in Rylands v. Fletcher had not been modified by the Court in Modern Cultivators and that strict liability was not applicable.3. Negligence in the Planning and Construction of the Bundh:The High Court found that the State was guilty of negligence in planning and constructing the bundh, which led to the flooding of the appellant's factory. The trial court's finding that the damage was an act of God was set aside. The Supreme Court agreed with the High Court's finding of negligence and held that the State was liable to compensate the appellant for the damages caused.4. Computation of the Period of Limitation:The Supreme Court examined the point of time from which the period of limitation should be computed. The Court held that in cases of negligence, strict liability, or violation of public duty, time begins to run not before the damage takes place. The Court concluded that the limitation period could commence either from the date when the damage took place or from the date when the claim was rejected by the authorities. Since the authorities refused to pay damages even though it was assessed at their own direction, the computation of the period for filing the suit arose from that date. Consequently, the suit was not barred by time.Conclusion:The Supreme Court allowed the appeal, set aside the decree and order passed by the lower courts, and decreed the appellant's suit for Rs. 1,58,735 with costs and interest. The Court held that Article 120 of the Limitation Act, 1908, applied to the facts of the case, and the suit was not barred by time.