R. Nagaraj v. Rajmani

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Civil Procedure Code, 1908 – Section 100 – Second Appeal – Limitation Act, 1963 – Article 59 – Suit to Set Aside Decree – High Court’s Remand – Concurrent Findings

Suit filed in 1982 to set aside a 1965 maintenance decree and for partition of joint family property, dismissed by trial and appellate courts as barred by limitation (17-year delay) and on merits. High Court allowed second appeal, remitted case to trial court to frame issue on limitation.

Held

High Court erred in remanding case without deciding substantial questions of law under Section 100 CPC; suit hopelessly barred under Article 59 as plaintiffs were aware of 1965 decree and execution proceedings; failure to frame specific issue on limitation not fatal when covered under broader issues and evidence led; concurrent findings of lower courts upheld, protecting bona fide purchasers’ rights. High Court’s judgment set aside, trial court’s dismissal restored.

Surat Singh (2018) 4 SCC 562; Santosh Hazari (2001); V.M. Salgaocar (SC) relied upon.

Citation: 2025 (4) KLR (SC) 56 : 2025 INSC 478
Court: Supreme Court of India
Bench: J.B. Pardiwala, J.; R. Mahadevan, J.
Date of Judgment: April 9, 2025
Case No.: Civil Appeal No. 5131 of 2025 (Arising out of SLP (C) No. 36 of 2021)
Parties:

• Appellants: R. Nagaraj (Dead) Through LRs. and Another (subsequent purchasers of suit property)
• Respondents: Rajmani and Others (daughters and wife of Dasappa Gowdar)

Facts

The case originates from a joint Hindu family comprising Rangappa Gowdar and his sons, Dasappa Gowdar and Samiappan. In 1965, Samiappan’s wife and daughter (Sunderammal and Vennila, Respondent Nos. 6 and 7) filed a suit (O.S. No. 851 of 1965) for maintenance against Samiappan, Rangappa, and Dasappa. The suit was decreed on August 26, 1965, and the suit properties were attached for maintenance in execution proceedings. The suit ‘A’ schedule property was auctioned and purchased by Karivarada Gowdar on September 25, 1970, with possession handed over on December 22, 1970. Subsequent purchasers, including Respondent Nos. 8–10, Respondent No. 11, and the appellants, acquired the property through valid transfers, with injunction suits (O.S. No. 1978 of 1972 and O.S. No. 3390 of 1981) decreed in their favor to protect possession.

In 1982, Respondent Nos. 1–3 (daughters and wife of Dasappa Gowdar) filed a second suit (O.S. No. 257 of 1982) to set aside the 1965 decree, seeking partition of the suit ‘A’ and ‘C’ schedule properties and a permanent injunction. They alleged fraud and collusion in the 1965 decree and claimed lack of knowledge of the earlier proceedings. The trial court dismissed the suit on September 8, 1994, citing limitation (17-year delay) and lack of merit, as Respondents were aware of the execution proceedings. The First Appellate Court affirmed this on January 28, 1997. However, the High Court, in Second Appeal No. 406 of 1998, allowed the appeal on February 17, 2020, remitting the case to the trial court to frame an issue on limitation and conduct a fresh trial, prompting the appellants to appeal to the Supreme Court.

Issues

1. Whether the High Court was justified in remanding the case to the trial court for a fresh trial on the issue of limitation, despite concurrent findings by the lower courts, under Section 100 of the Code of Civil Procedure (CPC), 1908.
2. Whether the suit filed by Respondent Nos. 1–3 in 1982 was barred by limitation under Article 59 of the Limitation Act, 1963.

Arguments

Appellants’ Arguments:

• Respondent Nos. 1–3 were aware of the 1965 decree and execution proceedings, as they were impleaded as judgment debtors, and a court guardian was appointed for the minor daughter.
• The suit filed in 1982, 17 years after the 1965 decree, was barred by limitation under Article 59 (three-year period to set aside a decree).
• The suit ‘A’ schedule property ceased to be joint family property after the court auction, confirmed sale, and subsequent transfers to bona fide purchasers.
• The trial and appellate courts correctly dismissed the suit on limitation and merits, and the High Court erred in remanding the case without deciding the substantial question of law under Section 100 CPC.
• Remanding the case after decades would prolong litigation and prejudice the rights of bona fide purchasers.

Respondents’ Arguments (Nos. 1–3):

• The High Court rightly remanded the case, as the trial and appellate courts failed to frame a specific issue on limitation, a mixed question of fact and law.
• The 1965 decree was obtained through fraud and collusion, and Respondents were unaware of the proceedings until 1981.
• The lower courts’ dismissal of the suit without framing an issue on limitation was procedurally flawed, justifying the High Court’s remand for a fresh trial.
• Respondent No. 3 was in mental distress after her husband’s death, and Respondents remained in possession of the suit properties.

Judgment

The Supreme Court allowed the appeal, set aside the High Court’s judgment, and restored the trial court’s dismissal of the suit, as affirmed by the First Appellate Court. Key points of the judgment:

1. High Court’s Error Under Section 100 CPC:
   • Section 100 CPC limits second appeals to substantial questions of law. The High Court, after formulating such questions, was obligated to decide them on merits rather than remanding the case to the trial court.
   • The High Court framed a substantial question at admission and an additional one on limitation but only addressed the latter, failing to decide the original question or adjudicate the appeal on merits.
   • Remanding the case after 17 years of litigation was unjustified, as it prolonged the dispute without purpose, contrary to judicial efficiency.
2. Limitation as a Question of Law:
   • The suit filed in 1982 to set aside the 1965 decree was barred by limitation under Article 59 of the Limitation Act, which prescribes a three-year period.
   • Respondent Nos. 1–3 were aware of the 1965 decree and execution proceedings, as evidenced by their impleadment and the appointment of a court guardian. Their claim of ignorance lacked specific pleadings or evidence.
   • The 17-year delay, without plausible reasons, rendered limitation a question of law, not requiring a separate issue, as the lower courts had analyzed it under broader issues.
3. Procedural Aspects:
   • The failure to frame a specific issue on limitation was not fatal, as the broader issues encompassed it, and both parties had led evidence and argued on limitation.
   • Section 3 of the Limitation Act mandates courts to dismiss time-barred suits, even without a specific defense plea. The trial court fulfilled this duty by analyzing evidence.
   • Procedural laws, like the CPC and Limitation Act, are meant to aid justice, not obstruct it. No prejudice was caused to Respondents by the lack of a separate issue.
4. Concurrent Findings and Bona Fide Purchasers:
   • The trial and appellate courts’ concurrent findings that the suit was time-barred and lacked merit were based on detailed evidence analysis, warranting no interference under Section 100 CPC.
   • The suit ‘A’ schedule property, sold through a court auction and transferred to bona fide purchasers, could not be challenged after 17 years, as it would undermine the sanctity of court sales and property transactions.
5. Conclusion:
   • The High Court’s remand was unsustainable, as it failed to follow Section 100 CPC’s mandate and ignored the lower courts’ reasoned findings.
   • The suit was hopelessly barred by limitation, and Respondent Nos. 1–3 were not entitled to relief. The trial court’s dismissal, affirmed by the First Appellate Court, was restored.

Ratio Decidendi

• Under Section 100 CPC, the High Court must decide substantial questions of law in second appeals and not remand cases to trial courts without justification, especially when concurrent findings exist.
• A suit to set aside a decree, filed 17 years after the decree with knowledge of the proceedings, is barred by limitation under Article 59 of the Limitation Act, 1963, and can be treated as a question of law when no plausible reasons for delay are pleaded.
• The failure to frame a specific issue on limitation is not fatal if the issue is covered under broader issues, evidence is led, and no prejudice is caused, as courts are duty-bound under Section 3 of the Limitation Act to dismiss time-barred suits.

Obiter Dicta

• Procedural laws, such as the CPC and Limitation Act, are handmaids of justice and should not be construed to hamper substantial justice unless serious prejudice is caused.
• The object of the Limitation Act is to prevent indefinite litigation and protect general welfare, not to destroy vested rights, but stale claims must be dismissed.
• Protection of bona fide purchasers for value is crucial, and disturbing their rights after a long delay undermines property transaction stability.

Precedents Relied Upon

• Surat Singh (Dead) v. Siri Bhagwan (2018) 4 SCC 562: Clarified the mandatory procedure under Section 100 CPC for framing and deciding substantial questions of law.
• Santosh Hazari v. Purushottam Tiwari (2001): Emphasized the High Court’s duty to decide second appeals on substantial questions rather than remanding.
• Ramakrishnan Kadinhipally v. P.T. Karunakaran Nambiar (SC): Criticized unnecessary remands in second appeals with concurrent findings.
• V.M. Salgaocar v. Board of Trustees of Port of Mormugao (SC): Held that courts must dismiss time-barred suits under Section 3 of the Limitation Act, even without a defense plea.
• Bharat Barrel & Drum Mfg. Co. v. ESI Corp. (SC): Explained the Limitation Act’s purpose to suppress stale claims and ensure timely action.
• Sardar Amarjit Singh Kalra v. Pramod Gupta (2003): Stressed that procedural laws should aid, not obstruct, justice.

Disposition

The appeal was allowed, the High Court’s judgment dated February 17, 2020, was set aside, and the trial court’s dismissal of the suit (O.S. No. 257 of 1982), as affirmed by the First Appellate Court, was restored. Parties were to bear their own costs.