Karnataka High Court
M/S Tafe Access Limited vs M/S S Mac Security Service on 3 January, 2024
Author: H.T. Narendra Prasad
Bench: H.T. Narendra Prasad
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RFA No. 1628 of 2016
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 3RD DAY OF JANUARY, 2024
BEFORE
THE HON'BLE MR JUSTICE H.T. NARENDRA PRASAD
REGULAR FIRST APPEAL NO. 1628 OF 2016 (MON)
BETWEEN:
M/S TAFE ACCESS LIMITED
PASSENGER CAR DEALER
NO.27-C, RACE COURSE ROAD
COIMBATROE-641 018
REPRESENTED BY ITS MANAGER
...APPELLANT
(BY SMT. SMITHA N.,ADVOCATE)
AND:
M/S S-MAC SECURITY SERVICE
PRIVATE LIMITED
NO.2132, 6TH "A" MAIN ROAD
III BLOCK, HRBR LAYOUT
Digitally signed NEAR BANASAVADI POLICE STATION
by KALYANANAGARA, BENGALURU 560 043.
DHANALAKSHMI
MURTHY REPRESENTED BY ITS AUTHORISED
Location: High SIGNATORY MR. B.ESWARAIAH.
Court of
Karnataka ...RESPONDENT
(BY SRI. ASHWIN KUMAR B.R.,ADVOCATE FOR
SRI. M.B. GAGAN GANAPATHY, ADVOCATE)
THIS RFA IS FILED UNDER SECTION 96 R/W ORDER XLI
RULE 1 OF CPC,1908., AGAINST THE JUDGMENT AND DECREE
DATED 16.07.2016 PASSED IN OS NO.4927/2014 ON THE FILE
OF THE XXX ADDL. CITY CIVIL JUDGE, BANGALORE.
DECREEING THE SUIT FOR RECOVERY.
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RFA No. 1628 of 2016
THIS APPEAL, COMING ON FOR HEARING, THIS DAY, THE
COURT DELIVERED THE FOLLOWING:
JUDGMENT
1. This appeal under Section 96 of CPC read with
Order 41 Rule 1 of CPC is filed by the appellant-
defendant challenging the judgment and decree dated
16.7.2016 passed by the XXX Addl. City Civil Judge,
Bangalore City in O.S.No.4927/2014, whereby the suit
filed by the plaintiff has been decreed.
2. For the sake of convenience, the parties are
referred to as per their ranking before the Trial Court.
3. Brief facts of the case of the plaintiff is that the
plaintiff is a private limited company engaged in the
business of providing security services by supplying
manpower to the companies and individual as required
by the companies and supply security personnel i.e.,
manpower of ex-servicemen. In turn, the plaintiff
receives the charge of service provided by the plaintiff.
The defendant is a limited company having its main
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office at Coimbatore and having its branch office at
Bengaluru and desired to get the service from the
plaintiff-company to take care of company security by
utilizing the manpower and offered to provide the same
by the plaintiff company. The plaintiff-Company
accepted the offer and agreed to provide the service to
the defendant-company and in this regard the plaintiff
and defendant have entered into a written contract with
terms and conditions and also payment of service
charges to the plaintiff-Company. As per the contract,
the agreement period came to an end on 31.10.2009
and thereafter the plaintiff and defendant with mutual
consent extended the period and also enhanced the
services charges as per the notification under the
Minimum Wages Act by Karnataka State Labour
Department. As on 31.3.2010, the defendant-company
was having an outstanding balance of Rs.5,26,196/- to
be paid to plaintiff-Company towards security service
charges. Hence, the plaintiff has issued demand notice
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and legal notice dated 26.2.2013 calling upon the
defendant to pay the outstanding dues. Inspite of
receipt of notice, the defendant has neither replied to
the said notice nor paid the outstanding dues. Hence,
the plaintiff filed the suit for recovery of money.
4. On service of suit summons, the defendant has
appeared through counsel and filed written statement
denying the entire plaint averments. Preliminarily, they
have raised objection that the suit is barred by limitation
and they have also contended that they do not have any
outstanding dues to the plaintiff-company.
5. On the basis of the pleadings of the parties, the
Trial Court framed the following issues:
1. Whether plaintiff proves that the defendant on
01/01/2008 entered into agreement for paying the
service charges of security guards to the plaintiff?.
2. Whether it further proves that the defendant
failed to pay the service charges till 31/10/2009
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and defendant is liable to pay Rs.6,26,196/- as on
31/3/2010?.
3. Whether it further proves that the defendant
failed to pay the service charges inspite of request
demands and issuance of letter dated: 15/4/2010
17/4/2010 and issuance of legal notice on
26/2/2013?.
4. Whether it further proves that it is entitled for
claim amount of Rs.7,20,2000/- with interest of
12% per annum?.
5. Whether suit is barred by time?.
6. Whether defendant proves that a security guard
by name Durgesh (wrongly typed as Dinesh) drove
its new car and caused damage to the car and it
has spent huge amount for repair of car and that it
liable to pay the claim amount?
7. What order or decree?.
6. To prove the case, the plaintiff has examined its
representative as PW-1 and produced 13 documents,
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marked as Ex.P-1 to 32. On behalf of the defendant, its
representative has been examined as DW-1 but no
document has been produced. On appreciation of oral
and documentary evidence, the Trial Court by impugned
judgment and decree dated 16.7.2016 has decreed the
suit and held that the plaintiff is entitled to recover a
sum of Rs.7,20,000/- with interest at 12% p.a. on
Rs.6,26,196/- from the date of suit till realization and
directed the defendant to deposit the said decreetal
amount. Being aggrieved by the same, the defendant
has filed this present appeal.
7. The learned counsel for the appellant-defendant has
contended that the suit filed by the plaintiff is barred by
limitation as it has been filed after lapse of 3 years from
the date of claim of the plaintiff. She further contended
that it is not in dispute that on 19.4.2010 itself, the
plaintiff has ended with providing services to the
defendant-Company and the same is evident from
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Ex.P-5, letter dated 15.4.2010 addressed by the plaintiff
to the defendant. She further contended that even in
the cross-examination of plaintiff i.e., PW-1, he has
admitted that plaintiff-Company has stopped providing
security services to the defendant-company from April
2010. Even as per Ex.P-7, statement of accounts, the
payment due by the defendant-Company is for the year
2010. The suit is filed in the year 2014 i.e., after lapse
of 3 years. As per Article 18 of the Limitation Act, the
suit is barred by time. But the Trial Court has erred in
holding that the limitation starts from the date of
issuance of legal notice dated 26.2.2013. This finding of
the Trial Court is contrary to the Article 18 of Limitation
Act and materials available on record. In support of her
contention, she has relied upon the judgment of Delhi
High Court in the case of Rakman Industries Limited -v-
Sumaja Electro Infra Private Ltd. (RFA (COMM) 8/2022
decided on 9.11.2022). Hence, she sought for allowing
the appeal.
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8. Per contra, learned counsel for respondent-plaintiff
has contended that it is not in dispute that the
defendant-Company has taken security services from
plaintiff-Company. Even after the contract entered into
between the plaintiff and defendant ended on
31.10.2009, with mutual consent of the parties, it was
extended till 31.3.2010 and for the extended period, the
defendant-Company has not paid the service charges.
Therefore, the plaintiff-company got issued a legal
notice dated 26.2.2013. The notice is duly served on the
defendant-company and the defendant has not replied
to the said notice. Therefore, the suit is filed for
recovery of money on 2.7.2014. The suit is filed within 3
years from the date of issuance of legal notice. The
plaintiff has also produced the statement of accounts to
prove that the defendant-Company has an outstanding
amount of Rs.5,26,196/- to be paid to the plaintiff
towards the security services rendered by the plaintiff-
Company. Considering all these aspects, the Trial Court
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has rightly decreed the suit and there is no error in the
judgment and decree passed by the Trial Court. Hence,
he sought for dismissal of the appeal.
9. Heard the learned counsel for the parties and
perused the judgment and decree of the Trial Court and
original records.
10. After hearing the learned counsel for the parties,
the point that arises for consideration in this appeal is:
"Whether the suit filed by the plaintiff for recovery
of money is barred by time?".
11. It is not in dispute that the plaintiff-Company was
engaged in providing security services by supplying
manpower to the companies and individuals. It is also
not in dispute that defendant-company has requested
the plaintiff to provide security services to the
defendant-Company. Accordingly, the plaintiff has
agreed to provide security services to the defendant-
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company and they have entered into a written contract
with terms and conditions. As per the contract, the
agreement period ended on 31.10.2009 and thereafter,
the plaintiff and defendant with mutual consent
extended the period till 31.3.2010 and also enhanced
the service charges as per the notification under the
Minimum Wages Act by Karnataka State Labour
Department. As per the documents produced by the
plaintiff, as on 31.3.2010, the defendant was having an
outstanding balance of Rs.5,26,196/- to be paid to the
plaintiff-Company towards security services rendered by
the plaintiff-Company. PW-1 in his cross examination
has clearly admitted that the plaintiff-company has
stopped providing security services to the defendant-
Company in the year 2010. Ex.P-5, letter dated
15.4.2010 addressed by the plaintiff to defendant
discloses that the plaintiff-Company has withdrawn the
security services from defendant-Company from
19.4.2010. Even Ex.P-7, statement of accounts discloses
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that the amount which is due to the plaintiff-company, is
for the year 2010. Therefore, it is very clear that the
amount claimed by the plaintiff-Company, which is due
by the defendant-Company, is related to the year 2010;
plaintiff-Company has stopped providing security
services to the defendant-Company from 2010 and the
suit is filed on 2.7.2014. Hence, from the said date of
events, it is clear that the suit is filed after lapse of 3
years from the date of amount claimed by the plaintiff
and from the date when the plaintiff-Company has
stopped providing security services to the defendant.
12. As per Article 18 of the Limitation Act, suit for
recovery of money has to be filed within 3 years from
the date when the work is done. It is very clear from
Article 18 of the Limitation Act that when a suit is to be
instituted for recovery of the price of the work done by
the plaintiff for the defendant and when there is no time
fixed for payment to be made, the cause of action for
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instituting the suit arises when the work is completed
and the suit has to be instituted within a period of three
years from the occurrence of the cause of action.
In the present case, it is very clear from the
evidence of the parties and documents produced by the
plaintiff, the plaintiff-Company has stopped providing
security services in the year 2010 and the amount
claimed by the plaintiff is also related to year 2010. The
suit is filed in the year 2014 i.e., after lapse of 3 years.
Hence, the suit is barred by time.
13. Even if the present case is considered under Article
113 of the Limitation Act, as per the contract entered
into between the plaintiff and defendant, the amount for
the work done has to be paid on or before 7th of every
month. But the work has been stopped in the year 2010
and the statement of account is raised for the year
2010. Therefore, the right to sue accrued in the year
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2010. The suit is filed in the year 2014 i.e., after lapse
of 3 years. Hence, the suit is barred by time.
14. It is well settled law that the period of limitation
cannot stand extended merely on account of issuance of
legal notice to the defendant. Once the right to sue has
accrued, limitation to file a suit cannot be extended by
sending reminders or other communications. If said
proposition is accepted, then limitation to file the suit
will never end and will be extended by sending repeated
demand notice.
15. Under the circumstances, this Court is of the
opinion that the Trial Court has not appreciated the oral
and documentary evidence in right perspective and it
has not adopted right approach to the real state of
affairs. The finding of the Trial Court that the suit is filed
within time, is contrary to the provisions of the
Limitation Act and contrary to the materials available on
record. Since the suit filed by the plaintiff is barred by
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limitation, the suit is liable to be dismissed. Accordingly,
the following order is passed:
ORDER
a) The appeal is allowed.
b) The judgment and decree dated 16.7.2016
passed by the XXX Addl. City Civil Judge, Bangalore
City in O.S.No.4927/2014 is set aside. The suit is
dismissed.
c) As per the directions of this Court dated
1.3.2017, the appellant has deposited 50% of the
decreetal amount. Hence, registry is directed to
refund the amount deposited by the appellant
before this Court, after due verification.
Sd/-
JUDGE
DM
