19 February 1964
Supreme Court
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MEMON ABDUL KARIM HAJI TAYAB Vs DEPUTY CUSTODIAN GENERAL, NEW DELHI AND OTHERS

Bench: GAJENDRAGADKAR, P.B. (CJ),WANCHOO, K.N.,GUPTA, K.C. DAS,SHAH, J.C.,AYYANGAR, N. RAJAGOPALA
Case number: Appeal (civil) 119 of 1963


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PETITIONER: MEMON ABDUL KARIM HAJI TAYAB

       Vs.

RESPONDENT: DEPUTY CUSTODIAN GENERAL, NEW DELHI AND OTHERS

DATE OF JUDGMENT: 19/02/1964

BENCH: WANCHOO, K.N. BENCH: WANCHOO, K.N. GAJENDRAGADKAR, P.B. (CJ) GUPTA, K.C. DAS SHAH, J.C. AYYANGAR, N. RAJAGOPALA

CITATION:  1964 AIR 1256            1964 SCR  (6) 780

ACT: Evacuee  Property  -Money  deposited with  an  Indian  by  a person who migrated to Pakistan-Liability to pay that amount to the Custodian-Adminstration of Evacuee Property Act, 1950 (31 of 838 1950)  Amended  v. 48 (Act No. 91 of  1956)-Limitation  Act, 1908 (9 of 1908), Art. 60.

HEADNOTE: Rupees  85,000/-  was deposited with the  appellant  by  his sister  in   January 1946.  The appellant’s sister  migrated to  Pakistan  sometimes between June to  August  1949.   The Assistant  Custodian called upon the appellant -to pay  this sum  lying in deposit under s. 48 of the  Administration  of Evacuee Property Act, 1950.  The appellant pleaded that  the amount could not be recovered from him because the money had been  given to him as a loan and its recovery was barred  in January   1949.   The  Assistant  Custodian   rejected   the contention  of  the appellant and directed him  to  pay  the amount  under  s.  48 of the Act, as it  then  stood.   This decision  was  affirmed in appeal as well  as  in  revision. Then  the  appellant moved a writ petition before  the  High Court  which was dismissed by the single Judge.  On  Latters Patent  Appeal the High Court held that the amount  was  not recoverable  under  s.  48 of the Act as  it  stood  at  the relevant time.  This decision was given on December 9, 1957. In the meantime, s. 48 had been amended on October 22, 1956. On  January 22, 1958 another notice of demand was served  on the  appellant  by the Assistant Custodian.   The  Assistant Custodian  again  directed the amount to  be  recovered  The appellant preferred an appeal before the  Custodian-General. The  Custodian General allowed the appeal and  remanded  the proceedings  for further enquiry as directed by him.   After the  remand further evidence was taken and it was held  that the  amount in question was payable by the appellant  as  it was  a deposit and was still recoverable when  the  property vested in the Custodian.  Thereupon the appellant  preferred an  appeal  to  the Custodian-General and  that  appeal  was

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dismissed. Then the appellant  applied  to  this  Court  for special leave which was granted.  Hence the appeal. Held:     (i)  Sub-ss.  1 and 2 of the amended s. 48 of  the Administration   of   Evacuee  Property  Act   are   clearly procedural  and  would apply to all cases which have  to  be investigated in accordance therewith after October 22, 1956, even  though  the claim may have arisen before  the  amended section  was inserted in the Act.  It is  well-settled  that procedural  amendments  to a law apply, in  the  absence  of anything to the contrary, retrospectively in the sense  that they  apply  to all actions after the date  they  come  into force even though the actions may have begun earlier or  the claim on which the action may be based may be of an anterior date.   In  the present case when  the  Assistant  Custodian issued notice to the appellant on January 22, 1958, claiming the amount from him, the recovery could be dealt with  under sub-ss. (1) and (2) of the amended a. 48, as they are merely procedural provisions. (ii) In  the present case the property which vested  in  the Custodian was not the actual money in specie lying with  the appellant  who must be treated as a banker with  respect  to the property with him; on the other hand the property  which vested   in  the  Custodian  would  be  the  right  of   the appellant’s sister to recover the amount from the appellant  839 and  that  would be incorporeal property in the form  of  an actionable claim.  It is in respect of that actionable claim that  the Custodian can proceed under s. 48 sub-ss. (1)  and (2),  to recover the sum payable to him in respect  of  that property, namely, the actionable claim.  The Custodian could not take action under s. 9 by physically seizing the  amount because  the amount cannot be treated as  specific  property which is liable to be seized under that section. (iii)     As this amount was a deposit, limitation would run at  the  earliest from the date of demand and  there  is  no evidence that any demand was made by the appellant’s  sister for the return of the money before she migrated to Pakistan. Therefore,  the period of limitation had not even  begun  to run on the date the appellant’s sister migrated to Pakistan, assuming  Art.  60  of  the Limitation Act  No.  9  of  1908 applied.   Consequently the right of the appellant’s  sister to  recover the amount vested in the Custodian and  was  not barred by limitation & the time when she became an evacuee.

JUDGMENT: CIVIL APPELLATE JURISDICTION: Civil Appeal No. 119 of 1963. Appeal  by special leave from the judgment and  order  dated January 16, 1961 of the Deputy Custodian-General, New  Delhi in Appeal No. 172-A /SUR/ 1960. M.   C.  Setalvad,  Atiqur Rehman and K. L. Hathi,  for  the appellant. C.   K. Daphtary, Attorney-General, K. S. Chawla and B.   R. G. K. Achar, for the respondents. February 19, 1964.  The Judgment of the Court was delivered by WANCHOO,  J.-This is an appeal by special leave against  the order  of  the Deputy Custodian General,  and  the  question involved  is  whether  the appellant is liable  to  pay  Rs. 85,000/-to  the  Custodian.  The matter has a  long  history behind  it  which  it is necessary to set out  in  order  to understand  the point now in dispute in the present  appeal. The  money in question was deposited with the  appellant  by his  sister as far back as January 1946.  The  total  amount

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deposited was Rs. 90,000/-, but the appellant’s sister  took back  Rs. 5,000/-, with the result that the balance  of  Rs. 85,000/-   remained  deposited  with  the  appellant.    The appellant’s sister thereafter migrated to Pakistan sometimes between June to August 840 1949.   Sometime  later,  the  Assistant  Custodian  General called  upon the appelant to pay this sum lying  in  deposit under  s. 48 of the Administration of Evacuee Property  Act, No. XXXI of 1950, (hereinafter referred to as the Act).  The appellant contested the matter on the ground that the  money had been given to him as a loan and its recovery was  barred in  January  1949  long before his sister  had  migrated  to Pakistan,  and therefore the amount could not  be  recovered from  him.   The Assistant Custodian  however  directed  the recovery  of the amount as arrears of land revenue under  s. 48  of the Act, as it then stood.  The matter was  taken  in appeal  before  the Custodian, Saurashtra,  but  the  appeal failed.   The  appellant  then  went  in  revision  to   the Custodian  General,  and  the revision  also  failed.   Then followed  a  writ  petition  by  the  appellant  before  the Saurashtra  High  Court  in 1955.   The  writ  petition  was dismissed  by a learned Single Judge; but on Letters  Patent Appeal the appellant succeeded, the High Court holding  that the amount was not recoverable under s. 48 of the Act as  it stood  at  the relevant time.  This decision  was  given  on December  9, 1957.  In the meantime, s. 48 had been  amended on October 22, 1956 and we shall refer to this amendment  in due course. After the appellant had succeeded in the High Court, another notice  of  demand  was  served  on  him  by  the  Assistant Custodian on January 22, 1958, and after hearing the  objec- tions  of  the  appellant,  the  Assistant  Custodian  again directed  the  amount to be recovered.  The  appellant  then took  the  matter in appeal to the Custodian  General.   The Custodian  General  allowed the appeal in  August  1958  and remanded the proceedings for further enquiry as directed  by him.  The Custodian General then held that s. 48 as  amended applied  to the fresh proceedings which began on the  notice issued  by  the  Assistant Custodian in  January  1958.   He further  held  that the amount was  -recoverable  under  the amended s. 48 provided it was due to the evacuee on the date the property of the evacuee vested in the Custodian.  He was therefore  of  opinion that it would have to  be  determined when   the sister of the appellant migrated and whether  the amount was due to her on the date of her migration and  had. not become barred by the law of Iimitation on that date.  Ho was further  841 of  opinion  that  the  question  whether  the   transaction amounted  to  a loan or a deposit had to  be  determined  as there  were  different periods of limitation for  these  two types of transactions.  He therefore remanded the matter for disposal  after  finding the facts in  accordance  with  the directions given by him.  After the remand further  evidence was  taken and it was held that the amount in  question  was payable  by the appellant as it was a deposit and was  still recoverable  when  the  property vested  in  the  Custodian. Thereupon  the  appellant  again  went  in  appeal  to   the Custodian General and that appeal was dismissed on  February 6,  1961.   Then  the appellant applied to  this  Court  for special leave which was granted; and that is how the  matter has come up before us. Two  questions  have been urged before us on behalf  of  the appellant.   The first is whether the amended s. 48  can  be

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applied  to  the present case.  The second  is  whether  the claim  of the Custodian is barred even on the basis  of  the transaction  between  the appellant and his sister  being  a deposit and not a loan. The  amended s. 48 came into the Act by Act No. 91  of  1956 from October 22, 1956 and runs as follows: -               "48.  Recovery  of certain sums as arrears  of               land  revenue:-(1)  Any  sum  payable  to  the               Government  or to the Custodian in respect  of               any  evacuee  property, under  any  agreement,               express or implied, lease or other document or               other#vise howsoever, may be recovered in  the               same manner as an arrear of land revenue.               (2)   If  any question arises whether the  sum               is  payable  to  the  Government  or  to   the               Custodian  within the meaning  of  sub-section               (1),  the Custodian shall, after  making  such               inquiry as he may deem fit, and giving to  the               person  by  whom  the sum  is  alleged  to  be               payable an opportunity of being heard,  decide               the   question;  and  the  decision   of   the               Custodian  shall,  subject to  any  appeal  or               revision  under this Act, be final  and  shall               not  be  called in question by  any  court  or               other authority 842               (3)   For  the purpose of this section, a  sum               shall be   deemed   to  be  payable   to   the               Custodian notwithstanding that its recovery is               barred by the Indian      Limitation Act, 1908               (9  of  1908), or any other law for  the  time               being  in  force  relating  to  limitation  of               action."  It  will be seen that this is mainly a  procedural  section replacing the earlier s. 48 and lays down that sums  payable to  the  Government  or to the Custodian  can  be  recovered thereunder  as  arrears of land revenue.  The  section  also provides  that where there is any dispute as to whether  any sum is payable or not to the Custodian or to the Government, the  Custodian  has to make an inquiry into the  matter  and give the person raising the dispute an opportunity of  being heard  and  thereafter decide the  question.   Further,  the section makes the decision of the Custodian final subject to any  appeal  or  revision  under the Act  and  not  open  to question  by any court or any other authority.   Lastly  the section provides that the sum shall be deemed to be  payable to the Custodian notwithstanding that its recovery is barred by  the Indian Limitation Act or any other law for the  time being  in  force  relating to limitation  of  action.   Sub- sections (1) and (2) are clearly procedural and would  apply to  all  cases which have to be investigated  in  accordance therewith after October 22, 1956, even though the claim  may have  arisen before the amended section was inserted in  the Act.  It is well settled that procedural amendments to a law apply,   in  the  absence  of  anything  to  the   contrary, retrospectively in the sense that they apply to all  actions after the date they come into force even though the  actions may have begun earlier or the claim on which the action  may be  based may be of an anterior date.  Therefore,  when  the Assistant  Custodian  issued  notice  to  the  appellant  on January 22, 1958 claiming the amount from him, the  recovery could be dealt with under sub-ss. (1) and (2) of the amended s. 48, as they are merely procedural provisions.  But it  is urged  on behalf of the appellant that sub-s. (1)  in  terms does  not apply to the present case, and if so,  sub-s.  (2)

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would also not apply.  The argument is that under sub-s. (1) it  is  only  any sum payable to the Government  or  to  the Custodian  in respect of any evacuee property which  can  be recovered as arrears of land revenue.  843 Therefore, the argument runs, evacuee property itself cannot be  recovered  under sub-s. (1), for that  sub-section  only provides  for recovery of any sum payable in respect of  any evacuee  property.   In this connection reference  has  been made to s. 9 of the Act, which lays down that if any  person in  possession of any evacuee property refuses or  fails  on demand to surrender possession thereof to the Custodian, the Custodian  may use or cause to be used such force as may  be necessary  for taking possession of such property  and  may, for  this  purpose,  after  giving  reasonable  warning  and facility  to any woman not appearing in public to  withdraw, remove  or break open any lock, bolt or any door or  do  any other  act necessary for the said purpose.  The argument  is that  the  Custodian can only take action  for  recovery  of evacuee property under this section.  We are of opinion that the  argument  is  misconceived. Section 9  deals  with  the recovery of immovable property or specific movable  property which  can  be  physically seized; it  does  not  deal  with incorporeal evacuee property which may vest in the Custodian and  which,  for  example,  may  be  of  the  nature  of  an actionable   claim.   So  far  as  actionable   claims   are concerned, they are dealt with by s. 48 as amended read with s. 10 (2) (i).  It is also a misconception to think that the amount  of  Rs. 85,000/- which is involved in this  case  is actually  evacuee property.  It is true that under s. 48  as amended, the Custodian can take action for recovery of  such sums as may be due in respect of any evacuee property and if the  sum  of  Rs.  85,000/- which  was  deposited  with  the appellant  is actually evacuee property, the  Custodian  may not  be  able  to take action under s. 48  (1)  and  (2)  in respect  of the same.  But the property which vested in  the Custodian was not the actual money in specie lying with  the appellant  who must be treated as a banker with  respect  to the property with him-, on the other hand the property which vested   in  the  Custodian  would  be  the  right  of   the appellant’s sister to recover the amount from the  appellant and  that  would be incorporeal property in the form  of  an actionable claim.  It is in respect of that actionable claim that the Custodian can proceed under s. 48, sub-ss. (1)  and (2),  to recover the sum payable to him in respect  of  that property,  namely, the actionable claim.  The contention  of the appellant that s. 48 (1) will not apply to the  recovery of this sum of money must 844 therefore  fail  and the Custodian would have the  right  to recover this sum of money as it is payable in respect of the evacuee  property  of the appellant’s  sister,  namely,  the right  which she had to recover the sum from the  appellant, and  it  is this right which vested in the  Custodian.   The Custodian  could  not take action under s. 9  by  physically seizing  the amount because the amount cannot be treated  as specific  property which is liable to be seized  under  that section.  If the appellant’s sister had the right to recover this   amount  from  the  appellant  that  right  would   be incorporeal  property which would vest in the Custodian  and in  respect  of which action could be taken under s.  48  as amended and not under s. 9  of the Act.  The  contention  of the appellant that s. 48, (1) and  (2) do not apply to  this case must therefore fail. The next contention is that in any case treating the  amount

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as  a deposit the right to recover it had become barred  and therefore  the  Custodian could not recover  it  under  this section  and that sub-s. (3) of s. 48 would not apply as  it affects  vested rights and is not procedural in  nature  and therefore  could not be applied retrospectively. Some  dates would be relevant in this connection.  On the findings    of the  authorities concerned, it appears that the deposit  was made  sometime  in  January 1946.   The  appellant’s  sister migrated  sometimes between June to August 1949.   According to  the law in force in that area at the relevant  time,  on the  date of migration of the appellants sister, she  became an  evacuee and her property would vest in the Custodian  on such  date.   So her right to recover this amount  from  the appellant would vest in the Custodian sometime between  June to  August  1949,  if it was still alive under  the  law  of limitation, even apart from the question that in such  cases only the remedy is barred though the right remains.  Further as this was a deposit, limitation would run at the  earliest from  the date of demand and there is no evidence  that  any demand  was made by the appellants sister for the return  of the  money before she migrated to Pakistan.  Therefore,  the period  of limitation had not even begun to run on the  date the  appellant’s sister migrated to Pakistan, assuming  art. 60   of  the  Limitation  Act,  No.  9  of   1908   applied. Consequently the right of, the appel-  845 lant’s sister to recover the amount vested in the  Custodian and was not barred by limitation at the time when she became an  evacuee.   The  demand was made for the  first  time  on January  10, 1952 by the Assistant Custodian and time  would run from that date, at the earliest. Then it is urged that even if the actionable claim vested in the  Custodian,  the demand in this case was  made  for  the first time on January 10, 1952, and therefore under art.  60 of the Limitation Act, the right to recover the amount would be  barred in January 1955, and consequently  no  proceeding could be taken under s. 48 to recover the same after January 1955.   It is further urged that the amended Act  came  into force on October 22, 1956 and sub-s. (3) would only apply to such cases where the limitation had not expired before  that date.   We  do not think it necessary for  purposes  of  the present appeal to decide the effect of sub-s. (3) of s.  48, for  the  appellant never contested before  the  authorities concerned that recovery could not be made tinder s. 48  even if the amount was treated as a deposit.  What the  appellant had contended before the authorities concerned was that  the recovery would be barred as the amount was given to him., as a  loan.  The appellant therefore cannot Dow for  the  first time in this Court take the plea that recovery could not  be made under s. 48 and sub-s. (3) thereof would not apply even if the amount is treated as a deposit.  This contention thus raised in this Court for the first time raises a question as to the effect of sub-s. (3) of s. 48.  Besides the effect of s.  48 (3), it is contended for the respondent that if  this question  had  been  raised before  the  proper  authorities evidence  might have been led to show that the recovery  was not  barred, for the case proceeded on ,he  assumption  that At.  60  of the Limitation Act applied and  proper  defences could  have  been raised as for example  the  conditions  on which the deposit was made i.e. whether on demand or  other- wise  and acknowledgements of liability made by  the  appel- lant.   Such  defence would have raised  questions  of  fact which  have never been investigated.  Therefore it is  urged that the appellant should not be allowed to raise the  point that  the  recovery would be barred even if the  amount  was

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treated is a deposit and should be confined to his case 846 that this was a loan and not a deposit, for he never pleaded at any time before the authorities concerned that even if it was a deposit the recovery would be barred by time.  We  are of opinion that there is force in this contention on  behalf of  the  respondents and we are not prepared  to  allow  the appellant  to raise the question whether the recovery  would be  barred even if the amount is treated as a  deposit.   In this  view  of  the matter, it would  not  be  necessary  to consider the exact effect of s. 48(3) and to decide  whether it  will apply even to cases where the recovery  had  become barred under the Limitation Act before October 22, 1956.  We therefore do not allow the appellant to raise the point that the  recovery  would  be barred even if  the  amount  was  a deposit. The  appeal  therefore fails and is  hereby  dismissed  with costs. Appeal dismissed.