Limitation accrual for misfeasance runs from the wrongful act; winding-up does not create a new substantive right.

Directors are not persons in whom company property becomes vested in trust for a specific purpose and thus do not fall within the express trust concept for limitation law; consequently Section 10 of the Limitation Act does not apply to bar limitation defences available to directors. The liquidator's remedy under Section 235 is procedural rather than substantive, and does not create a new cause of action on winding up; claims for misfeasance accrue at the time of the wrongful acts and limitation runs from that date, so a winding-up order cannot revive time-barred claims.

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Issues: (i) Whether directors of companies are "persons in whom property has become vested in trust for any specific purpose" within the meaning of Section 10 of the Limitation Act; (ii) If they are not trustees under Section 10, from what date does limitation run for a liquidator's claim under Section 235 of the Indian Companies Act, 1913 (i.e., whether the winding-up order gives rise to a new right or merely provides a procedural remedy).

Issue (i): Whether directors are trustees for the purpose of Section 10 of the Limitation Act.

Analysis: English and Indian authorities treat directors as not being express trustees in whom company property is vested for a specific purpose; directors may be liable as if trustees for misapplied funds but the property of the company does not become legally vested in them. Authorities distinguishing express trusts from constructive or quasi-trustees establish that entrustment for the general purpose of carrying on company business is not a specific trust within Section 10.

Conclusion: Directors are not persons in whom property has become vested in trust for any specific purpose within Section 10 of the Limitation Act; therefore Section 10 does not bar limitation defences available to directors.

Issue (ii): Whether the liquidator's right under Section 235 arises from the winding-up order (giving a new right) or whether Section 235 is procedural and the cause of action accrues when the misfeasance occurred.

Analysis: Precedent shows that the corresponding English provision is procedural and does not create new substantive rights; the liquidator's remedy under Section 235 is a summary mode of enforcing existing rights rather than a new right accruing on winding up. If no new right is conferred, limitation runs from the date of the wrongful acts; equitable considerations about the liquidator's existence do not alter that the remedy is procedural only.

Conclusion: Section 235 does not create a new substantive right on winding up; limitation for claims of misfeasance runs from the date of the misfeasance and the liquidator cannot revive claims already time-barred by relying on the winding-up order.

Final Conclusion: The appeal is dismissed; directors may rely on limitation and a liquidator's Section 235 application does not revive claims that were already barred by limitation.

Ratio Decidendi: Directors are not express trustees within Section 10 of the Limitation Act and Section 235 of the Indian Companies Act, 1913 provides a procedural remedy only, so causes of action for misfeasance accrue at the time of the wrongful acts and limitation runs from that date.

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