(Ahsanuddin Amanullah and K. Vinod Chandran, JJ.)
K. Prabhavati ___________________________________ Appellant;
v.
M. Harish Babu ___________________________________ Respondent.
Civil Appeal No. of 2025 (@ Special Leave Petition (C) No. 25216 of 2023), decided on December 16, 2025
The Order of the court was delivered by
Order
1. Leave granted.
2. The piquant question arising in the above case is as to whether the limitation applicable insofar as the recovery of money sought in the suit is under Article 22 of the Limitation Act, 19631, being a deposit, payable on demand.
3. The plaintiff is the appellant and the respondent is the defendant, former having succeeded before the Trial Court against which the appeal filed by the latter was successful in the High Court. The impugned judgment found that the limitation commences on the due date as perceived from the document evidencing the transaction and the suit was filed far beyond the said date.
4. Learned Senior Counsel for the appellant vehemently argued that the transaction was in the nature of a deposit and limitation commences only when a demand is made, under Article 22 of the Act. Article 22 provides for a limitation of three years from the date of the demand made. The demand was made by Annexure P2 notice and the suit filed was within three years of the demand by way of that notice.
5. The learned counsel for the respondent on the other hand asserted that the mere reading of the document indicates that though it was a deposit, it was for a fixed period and the cause of action had commenced within one year of the deposit, which was the specific period provided in the document.
6. The appellant relied on the judgment of this Court in Annamalai Chettiar v. Veerappa Chettiar2. Therein a suit was filed by the plaintiffs claiming amounts deposited with the joint Hindu family, by their predecessor-in-interest, which was payable with interest on yearly rests. Therein three contentions were raised; i) there being no evidence of deposit, ii) the voucher being a promissory note was not stamped; and iii) the bar of limitation. On the question of evidence, it was held that there was no objection made to the marking of the document and the later objection taken cannot be sustained. On the recitals in the receipt, it was found that it was a deposit which provided for payment of the said sum with interest on monthly rests but payable once in 12 months. It was found to be a deposit and not a promissory note despite the recital having ‘promised to pay’ which words alone could not convert the document into a promissory note especially looking at the intention of the parties and the circumstances of the case was the finding. That limitation argued therein was on the basis of a receipt issued by the plaintiffs to another branch of the family, on settlement of half of the claim. The instant claim was against the junior branch for the balance amounts. It was found that the receipt issued settled the claim raised against the other branch and the same cannot have any bearing in deciding the limitation for the claim raised for the other half, on the severed branch of the joint family. The limitation dealt with in that case was quite distinct and different from that raised herein.
7. In the present case, the recitals in Annexure P1 clearly indicate an amount of Rs. 1,00,000/- (Rupees One Lakh only) having been deposited for one year at the rate of 24% interest payable on a monthly basis. The deposit was clearly for a month and the interest was payable on a monthly basis. The notice was first issued in the year 2001 and there is no claim of the terms of the deposit, i.e.: payment of interest having been continued after the one-year period stipulated. On the contrary, the categoric statement made by the plaintiff in the notice and the suit is that there was no interest paid by the respondent. Going by the specific terms of Annexure P1, the deposit was for only one year and the interest was payable every month. Annexure P1 is dated 09.10.1992 and hence the cause of action arose on 09.10.1993.
8. More apposite is the decision referred to in the impugned order, Kashinath Sankarappa Wani v. New Akot Cotton Ginning and Pressing Co. Ltd.3 wherein considering parimetria provision of Article 21; Article 60 in the Limitation Act, 1908, it was held that receipt evidencing deposit of money for 12 months enjoins the starting point of limitation on the due date i.e. after 12 months.
9. The suit is clearly barred by limitation and we find no reason to interfere with the impugned judgment.
10. The appeal is dismissed and pending application(s), if any, shall stand disposed of.
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1 hereinafter referred to as the ‘Act’
2 (1952) 2 SCC 668
3 AIR 1958 SC 437
