As legal practitioners, it is our duty to provide clarity on the provisions of the Indian Limitation Act, 1963, and how they apply to specific scenarios relating to Non-Resident Indians (NRIs). In this regard, we hereby aim to explain Section 17 of the Indian Limitation Act, which concerns equitable claims and provides for a limitation period of three years from the date on which the right to sue accrues.
In essence, Section 17 of the Indian Limitation Act sets out a time limit within which an NRI who has been wronged in an equitable claim must file suit. An equitable claim refers to a legal remedy granted by courts in situations where monetary compensation may not be enough. This includes specific performance or injunctions.
More specifically, Section 17 stipulates that such suits must be filed within three years from when “the right to sue first accrues.” This means that if an NRI is aggrieved due to some breach of equity committed against them (such as fraudulent misrepresentation), they have only three years from when they became aware or ought reasonably have become aware of their cause of action.
It is important here not just for NRIs but all citizens intending delayed justice that one understands what “right to sue” signifies? To understand this meaning we must refer Section 18 – Effect of Fraudulent Acknowledgment before discussing further about cases related with section 17,
Section 18 states –
“Where any acknowledgment or payment on account of debt has been made before the expiration
of prescribed period by person liable‘to pay’ such debt.,
it shall start again fresh limitation period.”
Hence after understanding above mentioned provision now let’s discuss four relevant case laws:
1.Kunhunni v.Manjulamma [2014 SCC Online Ker16070;
2.Laxman v.Anil Kumar Singhvi8SCC369;
3.M.V.Shresthav.Swingletree Shipping Agencies [National Commission, 2012]
4.Antulay v.R.S Naik1SCC225.
Kunhunni v. Manjulamma – This judgement of the Kerala High Court held that if there is a case where once the cause of action has arisen there have been continuous breaches by a party then each fresh breach would allow for starting of limitation period afresh.
Laxman v. Anil Kumar Singhvi – In this case, The Hon’ble Supreme Court observed that when it comes to equitable claims, time is not always the essence and what needs to be considered is whether or not there was delay in filing suit and why. Hence one may be allowed more time than three years under certain circumstances and principles can vary from case to case basis depending on facts.
M.V.Shrestha vs Swingletree Shipping Agencies – In this National Consumer Dispute Resolution Commission Case; Supreme court holds “(a) The moment goods are delivered by carrier/exporter they lose their character as goods in possession of exporter and become goods in transit.
(b) Goods continue to remain in transit even after arriving at port till Custom clearance formalities completed.”
Antulay v R.S Naik- Apex Court while giving directions regarding condonation of delay/extension under section 5 also flagged relevant factors like bona fide intention etc hence every aspect must be studied before extension or non-extension.
Furthermore, NRIs should bear in mind that failure to comply with Section 17’s regulations could result in their claim becoming time-barred; hence it is essential for them to act swiftly when aware of an equity-related issue such as fraudulent misrepresentation. It must be noted here that during grace period known as “the law of limitation.” Plaintiffs’ right becomes stale after specified period within which one has to institute proceedings otherwise plaintiff loses his vested right.
This is especially relevant to NRIs who are residing out of India, as they might face difficulties in keeping track of potential breaches of equity by their counterparty. Therefore, it is prudential for NRIs to appoint a trusted agent or legal counsel within the country for effective communication and timely action regarding equitable claims.
In conclusion, Section 17 of the Indian Limitation Act sets a time limit for equitable claims based on when one’s right to sue arises. It is crucial for NRIs to understand this provision and act accordingly within the specified time period, as failure to do so can lead to loss of remedy. Additionally, case laws showed that circumstances may vary hence facts play vital role while dealing with Equity related issues.