Holding

Section 120 of the Major Port Trusts Act, 1963 mandates both a one‑month statutory notice and filing the suit within six months; the appellant failed to satisfy either requirement, rendering the suit non‑maintainable and barred by limitation, and the provision is constitutionally valid.

Summary

The appellant, an iron‑ore exporter, claimed a rebate of Rs 62,46,548.10 from the Board of Trustees of Mormugao Port, alleging that the Board had unlawfully levied a surcharge and refused full rebate. The Board raised two defenses under Section 120 of the Major Port Trusts Act, 1963: that the appellant had not served the mandatory one‑month statutory notice and that the suit was filed more than six months after the cause of action accrued on 16 June 1984. The Court held that both requirements of Section 120 must be satisfied conjunctively, that the appellant’s letter of 12 April 1984 was not a statutory notice, and that the suit filed on 11 September 1986 was therefore barred by limitation. The Court also rejected the appellant’s claim that the provision was unconstitutional, finding a rational nexus with the Act’s purpose and confirming that a special statute prevails over the general Limitation Act. Consequently, the appeal was dismissed.

Issues considered

Whether Section 120 of the Major Port Trusts Act, 1963 requires both a one‑month notice and filing the suit within six months, and whether the notice requirement was complied.
Whether the suit filed on 11 September 1986 is barred by limitation under Section 120.
Whether the appellant’s letter dated 12 April 1984 can be treated as statutory notice under Section 120.
Whether Section 120 violates Articles 14 and 19(1)(g) of the Constitution.
Whether a waiver of the notice or limitation requirement can be raised after a decree on admission under Order 12 Rule 6 of the CPC.
Whether a decree on admission precludes later dismissal of the remaining claim on limitation grounds.

Legislation cited

Arbitration and Conciliation Act, 1996s. 34
Code of Civil Procedure, 1908s. Order 12 Rule 6
Indian Ports Act, 1908
Limitation Act, 1963s. 29, s. 3
Major Port Trusts Act, 1963s. 120

Subjects

limitationnotice requirementSection 120Major Port Trusts Actconstitutional validityArticle 14Article 19waiverdecree on admissionCPC Order 12 Rule 6special vs general law

Judgment

-- V.M. SALGAOCAR AND BROS. A
v.
BOARD OF TRUSTEES OF PORT OF MORMUGAO AND ANR

MARCH 31, 2005

[ASHOK BHAN AND A.K. MATHUR, JJ.] B

Major Port Trusts Act, 1963-Section 120:

Notice-Non giving of-Held: Giving of notice is a mandatory
requirement for filing suit-Suit filed without giving notice is thus not, C
maintainable-Further, Suit filed on expiry of six months of accrual of cause
of action is also barred by time.

There are two requirements in the Section and both the requirements
have to be read conjunctively and not alternatively-The suit has to be filed D
within six months of accrual of cause of action and to be preceded by one
month's notice-The word 'or' occurs between two clauses ifread alternatively
would defeat the very object and intention and lead to absurdity.

- Shorter period of limitation provided for filing suit-Constitutionality
of-Held: Siatute is founded on public policy that an unlimited and perpetual E
threat oflitigation leads to disorder and confusion and creates insecurity and
uncertainty-Therefore legislature has sought to balance the public interest in
providing limitation on the one hand and at the same time not to unreasonably
restrict the right of a party to initiate proceedings on the other-Once a suit
is filed the object of limitation as a statute repose is satisfied in as much as
the opponent party knows what he has to defend F
Interpretation of statutes-Provisions of special Act to prevail over the
general Act.

limitation prescribed for filing suit against Port authorities-No
I limitation prescribed for suit by Port authorities-Reasonableness of '0
classification-Challenge to-Held: legislative in its wisdom can make separate
provision within which a suit must be filed by the individual from that within
which a suit can be filed by a statutory body.

27 H
28 SUPREME COURT REPORTS (2005] 3 S.C.R.

A Shorter period provided under, for suits against Board of Trustees
whereas suits against Government can be filed within normal period of
limitation-Held: Section I 20 not violative .of Article 14 on that ground as
there is rational basis for such differentiation.

Limitation-A statute ~ot dealing with the limitation in general and
B which prescribes period of limitation different from the one in the Indian
Limitation Act, 1963 cannot be said to be violative ofArticles 14 and 19(J)(j)
of Constitution of India, 1950.
..
Limitation Act, 1963-Section 3-Waiver of limitation-Held: If a suit
is ex-facie barred by the Law of Limitation, a Court has no choice but to
C dismiss the same even if the defendant intentionally has not raised the plea of
limitation.

Code of Civil Procedure, 1908 :

Order I 2, ·Rule 6-Decree ofadmissions-Respondent disputing the claim
D as time barred but admitting part of claim-Trial court passing decree on
admission-Correctness of-Held: Suit having been par.tly decreed on
admission could not be subsequently dismissed on the ground oflimitation for
the remaining amount.

E Waiver-Plea not raised before trial court-Question of waiver taken
· for the first time at the argument stage before the High Court-Permissibility
of -Held: Question of waiver is not a pure question of law hence could not
be permitted to be raised at any stage of proceedings.

Respondent Board had provided a Mechanised Ore Handling Plant
F (MOPH) for facility of iron ore exporters at Goa Port and fixed certain
rates for proper utilization. It was also levying surcharge and granting
rebates. The respondent by its letter dated 6.4.1984 informed the appellant
that they had become eligible to receive the rebate of Rs.7,09,835@ Re.I
per tonne for having turned over the plot allotted to it 6.39 times. The
appellant by their let.ter 12.4.1984 set out various arguments to justify the
G ground for full rebate and requested for the refund of th~ entire sum of
Rs.62,46,584.10. ID reply thereto, the respondent Board by its letter dated
16.06.1984 declined the request of the appellant contained in its, letter dated
12.04.1984.

The appellant filed suit on 11.6.86. Respo~dents admitted part of the
H
V.M. SALGAOCAR v. BOARD OF TRUSTEES OF PORT OF MORMUGAO 29

claim. However, it contended that suit was barred by time under Section A
t 20 of Major Port Trust Act, 1963 which prescribes a period of six months
from the date of arising of cause of action. Appellant claimed that when
normal period of limitation under Limitation Act is 3 years, prescribing
shorter period under Ports Act is unconstitutional. It also asked for decree
under Order 12, Rule 6 CPC of the admitted claim. The Trial Court passed
a decree on admission with regard to the sum of Rs. 7,09,835. The main
suit was dismissed by the District Judge as being barred by time and not
maintainable for want of notice. High Court upheld the order of trial
court Hence the present appeal.

Dismissing the appeal, the Court c
HELD : 1. The mandate of Section 3 of Limitation Act is that it is
the duty of the Court to dismiss any suit instituted after the prescribed
period of limitation irrespective of the fact that limitation has not been
set up as a defence. If a suit is ex-facie barred by the Law of Limitation,
a Court has no choice but to dismiss the same even if the defendant D
intentionally has not raised the plea of limitation. [41-E)

Manindra Land and Building Corporation Ltd v. Bhutnath Banerjee and
Ors., AIR (1964) SC 1336 and Motilal Padampat Sugar Mills Co. Ltd v.
State of Uttar Pradesh and Ors., (1979) 2 SCC 409, referred to.
E
2. The lis between the parties is, the refusal of rebate of
corresponding levy of surcharge to the extent or Rs.7.80 per metric tonne
aggregating to Rs. 55,36,710.10 paise for the year April, 1983 to March,
1984. By agreeing to pay Rs. 7,09,835 which the respondent Board was
always ready a~d willing to pay, would not affect the Board's legal F
contention regarding the claim of Rs. 55,36, 710.10 paise being not
maintainable in the absence of a notice under Section 120 of the Major
Port Trust Act, 1963. Order 12 Rule 6 empowers the Court where an
admission of fact is made either in the pleadings or otherwise, whether
orally or in writing, to make such order or such judgment as it thinks fit
either .on the application of a party or on its own motion and without G
; waiting for the determination of any other questions between the parties:
Therefore, by passing a decree on admission under Order 12 Rule 6 it
cannot be said that there was any determination of the question of
limitation or maintainability of the suit. Simply because the Board had
agreed tQ, pa, the sum of Rs. 7,09,835 would not mean that they had given H
30 SUPREME COURT REPORTS (2005] 3 S.C.R.

A up the determination of the question of limitation or the maintainability
of the suit for want of statutory notice. [42-A-EJ

3. The appellant had at no stage of proceedings had pleaded waiver
of the plea of limitation or of the giving of the notice under Section 120 of
the Major Port Trust Act, 1963. The point regarding waiver was not
B argued before the Trial Court at any stage and even in the memo of appeal
filed before the High Court ground of waiver was not taken. The question
of waiver was taken up for the first time at arguments stage before the
High Court. Question of waiver is not a pure question of law which could
be permitted to be raised by the appellant at any stage of the proceedings.
C The High Court was right in observing that the plea of limitation put up
by the Board has to be examined on its own merit. Therefore, there is no
merit in contention that the suit having been partly decreed on admission,
could not subsequently be dismissed on the ground of limitation (or the
remaining amount. [42-E, G; 43-H; 44-A-B)
D 4.1. The Major Port Trusts Act, 1963 is a special Act and Section
120 of the said Act provides limitation of proceedings in respect to the
things done under the Act. The suit has to be filed within six months of
the accrual of the cause of action and it has to be preceded by one month
notice. Both these requirements have to be read conjunctively and not ·
E alternatively. The word 'or' occurs between giving of the notice in writing
and the filing of the suit after six months of the accrual of the cause of
action. The word 'or' employed between the two clauses if read
alternatively would defeat the very object and intention of the said
provision and would lead to absurdity. (44-E, F-G; 45-A]
F Shipping Corporation of India Ltd v. Union of India and Anr., (1976)
A.P.261, approved.

4.2. Admittedly, formal notice under Section 120 had not been issued.
The cause of action arose to the appellant for the first time on 16.06.1984
G and, therefore, the letter dated 12.04.1984 cannot be said to be a notice
under Section 120 of the Act, which requires the cause of action to be set ·
out in the said statutory notice. In the plaint there is no averment to the ~
effect that the appellant had given the notice under Section 120. Appellant
has taken the stand that he was not prevented by Sections 120 and 121 of
the Act froin filing the suit. If that be the case, then the letter dated
H 12.04.1984 cannot be treated as a notice under Section 120 of the Act. The
-- V.M. SALGAOCARv. BOARD OF TRUSTEES OF PORT OF MORMUGAO

cause of action arose to the appellant on 16.06.1984 and the present suit
3J

A
was filed on 11.09.1986 which is much beyond the period of six months
provided for filing the suit. The suit is thus held to be not maintainable in
the present form as well as barred by limitation. [45-B, D-F)

Municipal Corporation of Greater Mumbai v. Hasham Ismail Mamsa,
AIR (1972) Born. 350 and Trustees of the Port of Bombay v. Premier B
Automobiles Ltd and Anr., [1974] 4 SCC 710, referred to.

5.1. A statute not dealing with the limitation in general prescribing
period of limitation is different from the one in the Indian Limitation Act,
1963. It does not follow that the provisions prescribing the said period of C
limitation violates Article 14 or 19(l)(f) of the Constitution of India.
(47-E-F)

5.2. The Major Port Trusts Act, 1963 charges the port authorities
with well thought out duties and functions in respect of providing port
facilities and equipment and providing services for receiving, landing and D
shipping of goods or passengers from and upon sea going vessels. As a
result of these multifarious functions, major ports and their officers are
faced and burdened with an explosive amount of litigation. The object of
Section 120 is two fold, i.e. provision of giving one month's notice setting
out the cause of action is to give the port authorities an opportunity to
consider the merits of the case of the aggrieved .party and make amends E
when possible to save litigation. To ensure that legal action against port
authorities and its officers is initiated expeditiously when evidence is fresh
and does not obliterate the probative material for honest defence.
[49-D-F)

6. The classification has a reasonable nexus to the object it seeks to F
achieve. The submission made on behalf of the appellant that though a
suit may be filed within six months, the trial of the suit could take place
long after this and that the evidence would never be fresh at that stage is
fallacious in as much as once the suit is filed against a party, the party is
put on notice and will, therefore, gather the relevant documentary evidence G
;. when fresh and preserve such evidence for the trial whenever the same
- would take place. [49-G-H)

7.1. The appellant's contention that in Indian Limitation Act, 1963
no provision for condonation of delay for institution of suit has been made
because a relatively longer period of limitation has been provided as H
32 SUPREME COURT REPORT$ (2005) 3 S.C.R.

A compared to limitation provided in appeals and other applications and
--
{,
therefore providing relatively shorter period of six mo~ths for filing the
suit under the provisions of Section 120 of Major Port Trusts Act without
a provision for condonation of delay would make the section arbitrary,
excessive, disproportionate and unreasonable restriction on the appellant's
right under Article 14 and 19(1)(g) of the Constitution cannot be accepted.
B The statute of limitation is founded on public policy that an unlimited and
perpetual threat of litigation leads to disorder and confusion and creates
insecurity and uncertainty. Therefore legislature has sought to balance the
public interest in providing limitation on the one hand and at the same
time not to unreasonably restrict the right of a party to initiate proceedings
C on the other. Once a suit is filed the object of limitation as a statute repose
is satisfied in as much as the opponent party knows what he has to defend.
The Major Port Trusts Act is a special Act. It is settled legal proposition
thatthe provisions of the Special Act shall prevail over with the general
Act. [50-A-D]

D 7.2. It is well settl.ed that although limitation being intended for
quieting title and in that sense looks at the problems from the point of
view of the defendant with a view to provide him security against the stale
claims, addresses itself at the same time also to the position of the plaintiff.
The legislature in its wisdom can make separate provision within which a
E suit must be filed by the individual from that within which a suit can be
filed by a statutory body. [51-C-D] ·

Nav Ratamnmal v. State of Rajasthan, AIR (1961) SC.1704, referred
to.

F 7.3. The Government cannot be equated with statutory body like the
Major Port Trusts Act. The Government is a vast organisation having
compara~ively larger manpower and in the litigation against the
Government subject matter of disputes is under several Acts such as Excise
Act, Customs Act, Income Tax Act, Railways Act, Land Acquisition Act
etc. Many of these Acts also contain provisions similar to if not identical
G with the provisions of Section 120. (52-C-D]

8. A provision of the Act providing for a shorter period of limitation
cannot be declared to be unconstitutional simply because in some of the
statutes a longer period of limitation has been prescribed for the redressal
of the litigants' grievances. The legislation enacted for the achievement
H of a particular object or purpose need not be all embracing. It is for the
V.M. SALGAOCAR v. BOARD OF TRUSTEES OF PORT OF MORMUGAO [BHAN, J.] 33

legislature to determine what categories it would embrace within the scope A
of legislation and. merely because certain categories which would stand
on the same footing as those covered by the legislature are left out would
not render the legislation of any law being discriminatory and violative
of the fundamental rights guaranteed under Articles 14 and ·19(l)(g) of
the Constitution. (52-D-FJ
B
CIVIL APELLA TE JURISDICTION : Civil Appeal Nos. 4662-4663 of
1999. High Court at Goa-Panaji in F.A. No. 27/92 and Appeal from Order
No. 69 of 1991.

R.F. Nariman, Milind Sathe, Bhavik Palan, Pratap Venugopal for Mis. C
K.J. John & Co. with him for the Appellant.

K.J. Presswala, U.A. Rana, Birju Mattam, Madup Singhal for M/s.
Gagrat & Co. Advs. for the Respondent No. I.

B. Datta Additional Solicitor General, Harish Chandra, Sr. Anuvrat
Sharma and B.K. Prasad for Mrs. Anil Katiyar, with them for the Respondent D
No. 2.

The following Judgment of the Court was delivered :

BHAN, J. These appeals by grant of leave are directed against the
common judgment and order of affinnation passed by the High Court of E
Bombay at Goa in First Appeal No.27 of 1992 and appeal from order No.69
of 1991. The suit filed by the plaintiff-appellant (hereinafter referred to as
'the appellant') was dismissed by the District Judge, South Goa, Monnugao
by judgment dated 30th December, 1991 on the ground that the same was not
maintainable for want of notice under Section 120 of the Major Port Trust p
Act, 1963 (hereinafter referred to as 'the Act') and that the suit was barred
by limitation. This judgment was challenged in First Appeal No.27 of 1992.
Prior to that District Judge vide order dated 30th April, 1991, had come tQ
the conclusion that Section 120 of the Act was applicable to the present case,
Against this order the appellant had filed an appeal from order 69 of 1991.
The two appeals having arisen from the same suit were heard together and G
disposed of by the High Court by a common judgment. We propose to do the
same.

We would referring to the facts necessary to dispose of the appeals as
found by the High Court on which there is no dispute between the counsel H
34 SUPREME COURT REPORTS [2005) 3 S.C.R.

A for the parties.
Loading operation in relation to iron ore at Mormugao Port was sought
to be regulated by the Mormugao Port (Shipment of Ore and Pellets from
Mechanised Ore Handling Plant at berth no.9 and related matters) Regulations,
1979. Respondent No. I-The Board of the Trustees of Mormugao (hereinafter
B referred to as 'the Board') was empowered to divide the storage area into
plots of a size sufficient to hold approximately the quantity required to be
loaded and to stipulate minimum tonnage turn over for each plot to qualify
for allotment of plot. The appellant who is engaged in exporting iron ore
were also allotted one such plot. Rates were prescribed per tonne of iron ore,
C handled through Mechanised Ore Handling Plan (MOPH) and revised from I
I
time to time. By a notification dated 26th October, 1983, the Board increased
the handling rate to Rs.28:22 per tonne and fixed minimum rental surcharge \
of Rs.8.80 per tonne. The Board did this to ensure proper utilisation of berth
and MOPH as it was found that there was under utilisation of the same by
exporters. The justification for imposing the surcharge of Rs.8.80 per tonne
D was that the Board had to pay Rs.260.30 lakhs t~ the contractor~ for dredging
a channel and widening the channel, so ~hat all sea going vessels could use
berth no.9. It is further the Board's case that Rs.7.16 Iakhs towards income
tax and Rs.20.00 Iakhs towards estimated liability arising out of the contract
labour legislation had to be disbursed. As the Board had incurred heavy
E losses on account of level of utilisation of MOPH between Rs.55.00 Iakhs
tonnes to 60.00 tonnes, surcharge was introduced, which surcharge was to be
reduced in proportion fo the tonnage exported by the exporters. This surcharge
was subject to rebate for the plot allottee holding the plot for minimum
period of one year on the following pattern:-
...
F On achieving a level of turnover Rebate (Rs. Per tonne)

6.25 times of nqminal plot capacity l.00

6.50 times of nominal plot capacity 2.00

G 6.75 times of nominal plot capacity 3.00

7.00 tim~s of nominal plot ..capacity 4.00

7.25 times of nominal plot capacity 5.20

H 7.50 times of nominal plot capacity 6.40
V.M. SALGAOCAR v. BOARD OF TRUSTEES OF PORT OF MORMUGAO [BHAN, J.] 35

7.75 times of nominal plot capacity 7.60 A
8.00 times of nominal plot capacity 8.80

Appellant had challenged the levy of surcharge of Rs.8.80 per tonne
being illegal, without jurisdiction null and void as it was not co-related to any
service rendered by the Board and that the levy was falling outside the B
purview of Section 48 of the Act. The High Court rejected the said challenge
relying upon a judgment of this Court in Mis. V.S. Dempo & Co. Pvt. Ltd
v. Board of Trustees and Anr., [1994] Suppl. 2 SCC 349. An exporter had
earlier challenged the levy of surcharge with graded system of rebates in a
writ petition· before the High Court. The writ petition was dismissed and the C
order of the High Court was upheld in appeal filed by the writ petitioner. In
view of the fact that the power to levy surcharge had' already been upheld by
this Court the counsel for the appellant did not argue this point before us.

Appellant's case further is that in the event the validity of levy of
surcharge is upheld, the action of the Board for refusing full rebate to the D
appellant and in collecting surcharge of Rs.7.80 is illegal, arbitrary,
unreasonable, contrary to the Act and Rules and Regulations as well as Article
14 of the Constitution on the ground that the surcharge of Rs. 7 .80 per tonne
has been levied without taking into consideration lapses on the part of the
Board as well as non-consideration of shortfall in' export of the appellant's
due to the factors beyond their control. The appellant had also raised dispute E
relating to the extent of alleged storage plot and the turnover required to be
achieved by the appellant during the year to be eligible for full rebate under
Notification dated 26th October, 1983. According to the appellant it was
entitled to the full rebate on 8,66, 192 metric tonnes. The lapses pointed out
on th~ part of the Board were stated to be failure of its obligation by providing F
barge unloaders to the appellant, commensurate with the appellant's export
commitments, insufficient barge allocation, break-down of reclaimer no.2,
port and dock workers strike etc. According to the appellant, considering the
plot capacity of 1,08,274 tonnes, the turnover of 8,66,192 metric tonnes
,...., would entitle the appellant a full rebate at the rate of Rs.8.80 per tonne which
comes to Rs.62,46,548.10 paise, instead of Rs.7,09,835/-, which the Board G
had agreed to pay. As per appellant, it had in fact exported through berth
no.9, 10,52,910 tonnes and even if nominal capacity of the plot was taken as
1,50,000 tonnes, the appellant would be entitled for full rebate at the rate of
Rs.8.80 per tonne, having turned over its plot of 1,50,000 tonnes. This
calculation was based upon the appellant's plea that they must be deemed to H
36. SUPREME COURT REPORTS [2005] 3 S.C.R.

A have exported through berth no.9, 3, 14,000 tonnes, which the appellant was
prevented from loading through berth no.9 due to insufficient barge allocations,
break~down of reclaimer no.2 and port and dock workers strike, which
amounted to 90,000 tonnes, 70,000 tonnes and 1,54,000 tonnes respectively,
thus totalling 3,14,000 tonnes. Alternatively, the appellant claim that the
Board had committed breach of statutory duty by failing to provide adequate
B barrage unloading timings as prescribed by the regulations and by refusing
to permit them to load its vessels by trans shippers when the reclaimer of the
Board was broken down.

Another challenge put by the appellant was that, the suit against Central
C Government or the State Government could be filed within 3 years after
giving notice under Section 80 of Code of Civil Procedure. The provision of
shorter period of limitation of 6 months under Section 120 of the Act to the
Board and its officers who are performing duties and functions similar to the
Union and the State Government was irrational, unreasonable and unrelated
to the object sought to be achieved by the Act and as such, Section 120 of
D the Act was unconstitutional and violative of the fundamental rights guaranteed
by Article 14 of the Constitution. It was further pleaded that in case the Court
finds that Section 120 of the Act was valid, letter dated 12th April, 1984
addressed by it to the defendant Board, be treated as notice under Section
120 of the Act. In short, the appellant prayed for a declaration that the
E minimum rental surcharge levied by Notification dated 26th October, 1983
bearing No.3-GA(8)/83 issued by the Board be declared as illegal,
unconstitutional, null and void; to declare the recovery to the tune of
Rs.62,46,548. l 0 paise as illegal being unconstitutional, null and void; and to
pay damages/compensation being equivalent to full rebate aggregating to the
sum of Rs.62,46,548.10 paise and to declare Section 120 of the Act as
F unconstitutional, null and void.

Another fact which needs to be mentioned i~ that the Board had admitted
in their letter dated 6th April, 1984 that the appellant was entitled to receive
rebate of Rs.7,09,835 as the appellant had turned over. the plot for 6.39 times
and were ready and willing to pay over the said amount of Rs. 7,09,835- to .....,
G ·the appellant. In view of the admission made by the Board, the appellant
sought judgment on admission for the sa!d sum .of Rs. 7,09,835 under Order
12, Rule 6 of C.P.C. The Board in its reply to the application under Order
12, Rule 6 stated that the Board had no objection to the passing of a decree
for Rs,7,09,835 in favour of the appellant but objected to the payment of
H 18% interest on the said amount with effect from 6.4.84. In this view of the
V.M. SALGAOCAR v. BOARD OF TRUSTEES OF PORT OF MORMUGAO [BHAN, J.] 37

matter, by judgment on admission under Order 12, Rule 6 C.P.C. dated A
12.8.87 the appellant's claim to the tune of Rs.7,09,835 was decreed. The
question of payment of interest and costs was left to be decided at the time
of final disposal of the suit.

The Board in its defence took up the plea that the appellant had achieved
turnover of only 6.25 times the nominal capacity of the plot and was entitled B
to the rebate of only Re.I per tonne and that the surcharge of Rs.7.80 per
tonne was neither illegal nor unconstitutional. The allegations relating to
deemed export claimed by the appellant, was denied. It was pleaded that
since no notice under Section 120 of the Act had been given by the appellant
to the Board the suit was not maintainable. It was further pleaded that the suit C
which had been flied beyond the period of 6 months from the date of accrual
of cause of action, was barred by limitation pem1itted under Section 120 of
the Act.

On the pleadings of the parties numbers of issues were framed. In view
of the finding recorded on issues No.12, 13 and 15 which were answered in D
favour of the Board, the suit was dismissed. Issues Nos.12, 13 and 15 are as
under :-

- "12. Whether the suit is not maintainable for want of notice under
Section 120 of the Major Port Trusts Act, 1963?
13. Whether the suit is barred by the provisions of Section 120 of E
the Major Port Trusts Act, 1963?

- 15. Whether the plaintiff proves that Section 120 of the Major Port
Trusts Act is not applicable, to this case and, if it is applicable,
it is unconstitutional and illegal?"
F
By order date~ 30th July, 1991, first part of issue No.15 was decided
in the negative and the appellant's contention that Section 120 of the Act is
not attracted, was rejected and it was held that Section 120 was applicable.

Against this part of the order, the appellant had filed appeal from order
which was numbered as 69of1991. The second part of issue No.15, 12 and G
13 were decided by the impugned judgment delivered on 30th December,
1991, which was the subject matter of challenge in First Appeal 27 of 1991.

Before the High Court following 3 points were canvassed for
determination :-
H
38 SUPREME COURT REPORTS (2005) 3 S.C.R.

A 1. When no objection relating to limitation was raised in relation to
the part decree passed on admission under Order 12, Rule 6
C.P.C., whether the defendant Board could raise objection relating
to limitation in respect of the remaining amount claimed by the
appellants and part of the suit could be dismissed on the ground
of limitation?
B
2. Whether Section 120 of the said Act is applicable and if the
answer is in the affirmative, whether letter dated 12.4.84 can be
treated as notice under Section 120 of the said Act and further
whether the suit is barred· by limitation thereunder?
C 3. Whether Section 120 of the said Act is unconstitutional?

The High Court answered all the three questions in favour of the
respondent by holding that the respondent did not waive the plea of limitation
for the remaining amount of Rs.55,36,710.10 paise. That Section 120 was
applicable to the present case. The letter dated 12.04.1984 addressed by the
D appellant to the respondents could not be considered as a notice under Section
120 of the Act and that Section 120 of the Major Port Trust Act, 1963 was
constitutionally valid. The High Court affirmed the judgment of the District
Judge regarding the legality and constitutional validity of Section 120 and
rejected the contention put forth by the appellant's counsel that by prescribing
the limitation of.6 months against the Board and its employees as against the
E period of 3 years in respect of suits against the Government or Government
Officers for an act or order passed in discharge of official capacity was
violative of Article 14 of the Constitution. It was held that the suit was baned
by time having been filed beyond the period of limitation provided under the
Act and the same was also not maintainable for want of service of notice.
F
During the course .of arguments Shri R.F. Nariman, learned senior
counsel for the appellant had conceded the first part of point no.2 framed by
the High Court to the effect that Section 120 of the Act was applicable to the
present case and made his submissions on point no. I, the second part of point
· no.2 and point no.3 In the written note submitteq on behalf of the appellant,
G the appellant has confined his submissions to point nos. I and 3 only. Since
the second part of point no2 goes to the root of the matter regarding
maintainability of the suit and ·its being barred by limitation we would deal
with the same.

H
V.M. SALGAOCAR v. BOARD OF TRUSTEES OF PORT OF MORMUGAO [BHAN, J.] 39

Point No. I A
Although we have already narrated the factual matrix giving rise to the
dispute but it would be necessary to refer to few facts in order to decide point
no. I. The respondent port trust commissioned a Mechanised Ore Handling
Plan (hereinafter referred to as "MOPH';) at berth no.9 at Mormugao and
prescribed rates for handling ore at MOPH. On 28.10.1983 the Board issued B
· a notification increasing the rates levying surcharge and p1escribing a rebate
on the basis of achieving a particular turnover. It is during this period that
the issue arose as to the actual piot capacity handed over to the appellant and
whether a particular turnover on the plot was achieved. According to the
appellant, considering plot capacity of 1,08,274 tonnes, the turnover of C
8,66, 192 metric tonnes would entitle the appellant to full rebate at the rate of
Rs.8.80 per tonne, which would come to Rs.62,46,548. l 0 paise, instead of
Rs.7,09,835 which the respondent Board had agreed to give. The respondent
Board informed the appellant that they had turned around the plot only 6.25
times on the basis of the plot capacity of 1.5 lakh tonnes and were therefore
entitled to rebate of Rs.7,09,835 only. On 12.04.1984 the appellant represented D
to the port trust and demanded full rebate @ Rs.8.80 per tonne. Port trust by
its letter dated 16.06.1984 refused to grant the full rebate as claimed by the
appellant.

On 11.09.1986 the appellant filed Civil Suit No.55/1986 for various
reliefs referred to in the earlier part of the judgment. Port trust on 14.02.1997 E
filed its written statement raising the plea of .limitation and failure to give
statutory notice as per Section 120 and also denying the claim on merits. The
appellant made an application under Order 12 Rule 6 for the decree on
admission in view of the port trust's letter dated 16.06.1984 referred to above.
The appellant had claimed interest @ 18% on the amount due from the date p
the amount became payable till its actual payment. The port trust in reply to
the application under Order 12 Rule 6 admitted the claim of Rs.7,09,835 but
denied its liability to pay any interest on the said amount. The Trial Court on
12.08.1987 passed a decree on admission with regard to the sum of Rs.7,09,835
leaving the question of interest on the aforesaid amount open which was to
be decided at the time of the adjudication of the main suit. The main suit was G
dismissed by the District Judge as being barred by time and not maintainable
for want of notice:

Counsel for the appellant has contended that the port trust in its reply
to application under Order 12 Rule 6 while admitting the claim did not raise H
40 SUPREME COURT REPORTS [2005] 3 S.C.R.

A any objection as to the plea of limitation or statutory notice. That on the
passing of the decree on admission under Order 12 Rule 6 on 12.08.1987, the
respondent Board was estopped from urging the point of limitation or statutory
notice. The said issue would be deemed to have been waived. That statutory
notice under Section 120 and issue of limitation being the rights created in
favour of the Board could be waived by the Board. Since the decree on
B admission under Order 12 Rule 6 of the Code of Civil Procedure was passed
without any reservation being made to the issuance of statutory notice or
limitation, the Board is estopped from raising such a plea at this stage. It is
further submitted that the issue of waiver of limitation and statutory notice
was raised by the appellant before the High Court and the same has been
C adjudicated upon by the High Court, the objection now raised by the counsel
for the respondents that waiver had not pleaded was untenable. It was submitted
that the dismissal of the suit on the ground of being barred by limitation
under Section 120 and for want of statutory notice under Section 120 of the
Act by the High Court was clearly erroneous.

D Per contra, learned counsel for the respondent Board submitted that the
High Court has taken the correct view in holding that there was no waiver
of limitation by the respondent Board regarding the remaining claim. of the
appellant. The mere fact that the suit was partly decreed would not preclude
~-
the respondent Board from raising the plea of limitation regarding the balance
E claim put forward by the appellant. It was argued that the Board had not
waived the plea of limitation for the remaining claim of Rs.55,36,710.10
paise; that limitation under the Limitation Act can11ot be waived and even if
a limitation is waived by a party, it cannot give the jurisdiction to the Court
to entertain a time barred suit. That the appellant had never pleaded waiver
and therefore, the same cannot be urged by the appellant. Merely because the
F Board had agreed to pay the admitted amount due to the appellant @ Re. I/
- per tonne it would not amount to waiver of the plea of limitation giving
jurisdiction to the Court to try a time barred suit.

Section 3 of the Limitation Act reads :-

G "Section 3 - Bar of limitation - (I) Subject to the provisions contained
in sections 4 to 24 (inclusive), every suit instituted, appeal preferred,
and application made after the prescribed period shall be dismissed
although limitation has not been set up as a defence.

(2) For the purposes of this Act -
H
V.M. SALGAOCAR v. BOARD OF TRUSTEES OF PORT OF MORMUGAO [BHAN, J.] 41

(a) a suit is instituted - A
(i) in an ordinary case, when the plaint is presented to the proper
officer;

(ii) in the case of a pauper, when his application for leave to sue
as a pauper is made; and

- (iii) in the case of a claim against a company which is being
wound up by the court, when the claimant first sends in his
claim to the official liquidator;
B

(b) any claim by way of a set off or a counter claim, shall be treated
as a separate suit and shall be deemed to have been instituted c
(i) in the case of a set off, on the same date as the suit in which
the set off is pleaded;

(ii) in the case of a counter claim, on the date on which the D
counter claim is made in court;
(c) an application by notice of motion in a High Court is made when
the application is presented to the proper officer of that court."

The mandate of Section 3 of Limitation Act is that it is the duty of the
Court to dismiss any suit instituted after the prescribed period of limitation .E
irrespective of the fact that limitation has not been set up as a defence. Ifa
suit is ex-facie barred by the Law of Limitation, a Court has no choice but
to dismiss the same even if the defendant intentionally has not raised the plea
of limitation.
F
This Court in Manindra Land & Building Corporation Ltd v. Bhutnath
Banerjee and Ors., reported in AIR (1964) SC 1336 held (para 9) :-

"Section 3 of the Limitation Act enjoins a Court to dismiss any suit
instituted, appeal preferred and application made, after the period of
limitation prescribed therefor by Schedule I irrespective of the fact G
whether the opponent had set up the plea of limitation or not. It is the
duty of the Court not to proceed with the application if it is made
beyond the period of limitation prescribed. The Court had no choice
and if in construing the necessary provision of the Limitation Act or
in determining which provision of the Limitation Act applies, the
subordinate Court comes to an erroneous decision, it is open to the H
42 SUPREME COURT REPORTS (2005) 3 S.C.R.

A Court in revision to interfere with that conclusion as that conclusion
led the Court to assume or not to assume the jurisdiction to proceed
with the determination of that matter."

A perusal of paragraph 13 of the plaint shows that the lis between the
parties is, the refusal of.rebate of corresponding levy of surcharge to the
B extent or Rs.7.80 per m~tric tonne aggregating to Rs. 55,36,710.10 paise for
the year April, 1983 to March, 1984. By agreeing to pay Rs.7,09,835/- which
the respondent Board was always ready and willing to pay; would not affect
the Board's legal contention regarding the claim of Rs.55,36,710.10 paise
-
being not maintainable in the absence of a notice under Section 120 of the
C Act. Order 12 Rule 6 empowers the Court where an admission of fact is made
either in the pleadings or otherwise, whether orally or in writing. to make
such order or such judgment as it thinks fit either on the application of a
party or on its own motion and without waiting for the determination of any
other questions between the parties. Therefore, by passing a decree on
admission under Order 12 Rule 6 it cannot be said that there was any
D determination of the question of limitation or maintainability of the suit.
Simply because the Board had agreed to pay the sum of Rs.7,09,835 as
committed by them in their letter dated 06.04.1983 would not mean that the
Board had given up the determination of the question of limitation or the
maintainability of the suit for want of statutory notice.

E The appellant had at no stage of proceedings had pleaded waiver of the
plea of limitation or of the giving of the notice under Section 120 of the Act.
The plaint was filed on 0 l.09. l 986, Board had filed its written statement
raising objections of limitations and maintainability of the plaint for want of
notice on 18.02.1987. Application for decree on admission was filed on
F 12.04.1987 and reply to the said application was filed by the Board on
18.07.1987. The decree on admission was passed by the Trial Court for the
sum of Rs.7,09,835/- on 12.08.1987. After the framing of issues and after an
application was made to try issues no.12 and 13 as preliminary issues on
22.12.1989, an application was filed by the appellant to amend the plaint. On
06.01.1990, a further application was filed by the appellant for further
G amendment of the plaint. Even though, the plaint was exhaustively amended
after the decree on admission, plea of waiver was not taken in the plaint. The
point regarding waiver was n~t argued before the Trial Court at any stage and
even in the memo of appeal filed before the High Court ground of waiver
was not taken. The question of ~aiver was ta.ken up for the first time at
H arguments stage before the High Court. The respondent Board objected to the
V.M. SALGAOCAR v. BOARD OF TRUSTEES OF PORT OF MORMUGAO [BHAN, J.] 43

taking of the said point before the High Court for the first time during the A.
course of arguments. This Court in Mis. Motilal Padampat Sugar Mills Co.
Ltd. v. State of Uttar Pradesh and Ors., [1979] 2 SCC 409 has held that
waiver is a question of fact and it must be properly pleaded and proved. No
plea of waiver can be allowed to be raised unless it is pleaded. This Court
observed in para 5 as follows :-
B
"We shall first deal with. the question of waiver since that can be
disposed of in a few words. The High Court held that even if there
was an assurance given by respondent 4 on behalf of the State
Government and such assurance was binding on the State Government
on the principle of promissory estoppel, the appellant had waived its C
right under it by accepting the concessional rates of sales tax set out
in the letter of respondent 5 dated January 20, 1970. We do not think
this view taken by the High Court can be sustained. In the first place,
it is elementary that waiver is a question of fact and it must be
properly pleaded and proved. No plea of waiver can be allowed to be
raised unless it is pleaded and the factual foundation for it is laid in D
the pleadings. Here it was common ground that the plea of waiver
was not taken by the State Government in the affidavit filed on its
behalf in reply to the writ petition, nor was it indicated even vaguely

-- in such affidavit. It was raised for the first time at the hearing of the
writ petition. That was clearly impermissible without an amendment
of the affidavit in reply or a supplementary affidavit raising such
plea. If waiver were properly pleaded in the affidavit in reply, the
E

appellant would have had an opportunity of placing on record facts
showing why and in what circumstances the appellant came to address
the letter dated June 25, 1970 and establishing that on these facts
there was no waiver by the appellant of its right to exemption under F
the assurance given by respondent 4. But in the absence of such
pleading in the affidavit in reply, this opportunity was denied to .the
appellant. It was, therefore, not right for the High Court to have
allowed the plea of waiver to be raised against the appellant and that
plea should have been rejected in /imine."
G
In the present case, plea of waiver had neither been taken in the original
plaint nor in the amended plaint which was amended subsequent to the passing
of the decree on admission for the sum of Rs. 7,09,835 nor even in the
grounds of appeal before the High Court. Question of waiver is not a pure
question of law which could be permitted to be raised by the appellant at any H
44 SUPREME COURT REPORTS [2005) 3 S.C.R.

A stage of the proceedings. The High Court was right in observing that the plea
of limitation put up by the Board has to be examined on its own merit. We
do not find any merit in the submission of the learned senior counsel appearing
for the appellant that the suit having been partly decreed on admission, could
not subsequently be dismissed on the ground of limitation for the remaining
B amount.

Second part of Point No.2

Shri R.F. Nariman, learned senior counsel appearing for the appellant
conceded before us the first part of the point no.2 that Section 120 of the Act
C is applicable in the present case. He addressed on the second part of question
no.2, "whether the letter dated 12.04.1984 can be treated as notice under
Section 120 of the said Act and further whether the suit is barred by limitation
thereunder."

Section 120 of the Act reads as under :-
D "Section 120 - Limitation of proceedings in respect of things
done under the Act - No suit or other proceeding shall be commenced
against a Board or any member or employee thereof for anything
done, or purporting to have been done, in pursuance of this Act until
the expiration of one month after notice in writing has been given to
E the Board or him stating the cause of action, or after six months after
the accrual of the cause of action."

The Major Port Trust Act, 1963 is a special Act and Section 120 of the
said Act provides limitation of proceedings in respect to the things done
under the Act. A perusal of this Section shows there are two requirements in
F the Section and both the requi_rements have to be read conjunctively and not
alternatively. The suit has to be filed within six months of the accrual of the
cause of action and it has to be preceded by one month notice. Admittedly,
in the present case formal notice under Section 120 had not been issued. It
w.as contended by the learned senior counsel! that requirement of Section 120
G of the Act would be satisfied if the plaintiff before filing the suit complie_s
with one of the two requirements herein. This submission has been made on
the basis that the word 'or' occurs between giving of the notice in writing
and the filing of the suit after six months of the accrual of the cause of action.
The Andhra Pradesh High Court in The Shipping Corporation of India Ltd
v. The Union of India and Anr., (1976) A.P. 261 has taken the view that the
H twp requirements of the said Section have to be read conjunctively and not r
V.M. SALGAOCAR t>. BOARD OF TRUSTEES OF PORT OF MORMUGAO [BHAN, J.] 45

alternatively. That not only.the suit has to be filed after the accrual of cause A
of action it has to be preceded by one month's notice given in the prescribed
manner. The word 'or' employed between the two clauses in the Section if
read alternatively would defeat the very object and intention of the said
provision and would lead to absurdity. We respectfully agree with the view
expressed in the aforesaid judgment and endorse the same.
B
Even on facts we find that the letter dated 12.04.1984 cannot be treated
as a notice under Section 120 of the Act. The respondent Board by its letter
It dated 06.04.1984 had informed the appellant that the appellant has become
eligible to receive the rebate of Rs.7,09,835/-@ Re.I/- per tonne for having
.,._ turned over the plot allotted to it 6.39 times during the financial year 1983- C
84. In reply thereto, the appellant by their Jetter 12.04.1984 set out various
arguments to justify the ground for full rebate and requested for the refund
of the entire sum of Rs.62,46,584.10 paise. In reply thereto, the respondent
Board by its letter dated 16.06.1984 deciined the request of the appellant
contained in its letter dated.12.04.1984. The appellant in para 30 of its plaint
has stated that the illegal levy/refusal of rebate was made on 16.06.1984. D
Thus the cause of action arose to the appellant for the first time on 16.06.1984
and, therefore, the letter dated 12.04.1984 by no stretch of imagination can
be said to be a notice under Section 120 of the Act, which requires the cause
-- of action to be set out in the said statutory notice. In the plaint there is no
averment to the effect that the appellant had given the notice under Section E
120. Appellant in paragraph 31 has taken the stand that the appellant was not
prevented by Section 120 and 121 of the Act from filing the suit. If that be
the case, then the letter dated 12.04.1984 cannot be treated as a notice under
Section 120 of the Act. Requirement of giving of notice under Section 120
is mandatory and a pre condition to the filing of the suit, and since the_ suit
was filed without giving the notice the same was not maintainable. The cause F
of action arose to the appellant on 16.06.1984 and the present suit was filed
on 11.09.1986 which is much beyond the period of six months provided for
filing the suit. The suit is thus held to be not maintainable in the present form
as well as barred by limitation.

With reference to point no.3 formulated for determination regarding the G
constitutional validity of Section 120 of the Act, it has been contended by
Shri R.F. Nariman, learned senior counsel appearing for the appellant that the
shorter period of limitation of 6 months prescribed under the Act is
unconstitutional and violative of Article 14 and 19 of the Constitution of
India as it singles out cases under the Act without intelligible differentia. It H
L

46 SUPREME COURT REPORTS [2005] 3 S.C.R.

A has no nexus with the objective sought to be achieved under Section 120 of
the Act. It was pointed out that in respect of suits against Government and
public officers under other laws, longer period of limitation has been prescribed
and there is no reason whatsoever to prescribe shorter period of limitation
under the Act. Elaborating this submission further learned senior counsel
B pointed out that under the Indian Limitation Act, l 963 there are three divisions
of the schedule to the Act. The first division concerns itself with suits where
the minimum period in the column of limitation is one year going up to 30 . I'
years. In the second division which deals with appeals much shorter period
of limitation is provided ranging from 30 days to 90 days. Similarly, in the
third division relating to filing' of applications again a very short period of
C limitation is prescribed ranging from lO days to 90 days. Article 134 to 137
providing for longer periods of limitation are an exception to the rule. Section
5 of the Limitation Act allows for condonation of delay in filing the appeals
or applications but not suit. According to him, it is so because the longer
period of limitation is provided for filing the suit and since short period is
i
given for filing of the appeals and applications, provision has been made for l
D condoning the delay on sufficient cause being shown to mitigate the hardship
caused to the litigants. That Section 120 which provides for short period of
limitation of six months for filing the suit without prescribing for the
condonation of delay to mitigate the hardship of the litigants is arbitrary,
excessive, disproportionate and unreasonable restriction on the appellant's .
E rights under Article 14 and 19(l)(f) of the Constitution of India. That the •
High Court wrongly felt bound by two decisions cited before it. The first
being of the Bombay High Court in Municipal Corporation ofGreater Mumbai
v. Hasham Ismail Mamsa, AIR (1972) Born. 350 and the other of this Court
in the Trustees of the Port of Bombay v. The Premier Automobiles Ltd and- _J
Anr., reported in [1974] 4 SCC 710. So far as Municipal Corporation of r
'
F Greater Mumbai's case (supra) is concerned it was contended that this was r.
not a decision on the point at all in as much as the counsel for the plaintiff
had not pressed the point regarding constitutional validity of the provision r
though the same had been raised. In so far as the Trustees of the Port of
Bombay's case (supra) it was pointed out that the constitutional validity of
-r
G Section 87 of the Bombay Port Trust Act had not been challenged at all. That
the observations made in the aforesaid cases are in the nature of obiter dicta
and therefore connot be treated as a precedent in the present case.

Before the Bombay High Court in Municipal Corporation of Greater
Mumbai 's case (supra) the challenge had been laid to Section 527 of the
H Bombay Municipal Corporation Act on the ground that the same was illegal
V.M. SALGAOCAR v. BOARD OF TRUSTEES OF PORT OF MORMUGAO [BHAN, J.] 4 7

and ultra vires as it violated the fundamental rights guaranteed to plaintiff A
under Article 14 and 19(l)(t) of the Constitution ofindia. The learned counsel
appearing for the plaintiff did not press the challenge to the constitutional
validity of Section 527 but the Division Bench found that there was no merit
in the contention raised by the plaintiff to the constitutional validity of Section
527 and observ.ed that merely because a statute not dealing with limitation in
general prescribed a special period of limitation different from the one in the B
Indian Limitation Act, it does not follow that the provision prescribing the
special period of limitation violates Article 14 of the Constitution, much less
Article 19(l)(f) thereof. It was observed in paragraph 9 :-
"xxx
Mr. Adik for the plaintiff did not press the constitutional point
c
raised in the above paragraph of the plaint and obviously for good
reasons. It is obvious that there is no substance in that contention.
Merely because a statute not dealing with limitation in general
prescribes a special period of limitation different from the one in the
Limitation Act, it does not follow that the provision prescribing the D
special period of limitation violates Article 14 of the Constitution,
much less Article 19(l)(f) thereof."

No doubt the learned counsel appearing for the plaintiffs in that case
had given up his challenge to the constitutional validity of Section 527 of the
Bombay Municipal. Act, but all the same the High Court recorded its reasons E
for upholding the validity of the Section by recording valid reasons which in
our view are correct. We agree with the observations made by the Divisitm
Bench in the said case that merely because a statute not dealing with the
limitation in general prescribed period of limitation different from the one in
the Indian Limitation A~t, 1963 it does not follow that the provisions p
prescribing the said period of limitation violates Article 14 or l 9(l)(f) of the
Constitution of India.

In respect to the judgment of this court in Trustees of the Port of
Bombay's case (supra) it is urged by the learned senior counsel appearing for
the appellant that the constitutional validity of Section 87 of the Bombay Port G
Trust Act, 1879 was not under challenge and therefore the said decision
cannot be a precedent for examining the constitutional validity of Section
120 of the present Act. Section 87 reads as under :-

"Section 87. No suit or other proceeding shall be commenced against
any person for any thing done, or purporting to have been done, in H
48 SUPREME COURT REPORTS . [2005] 3 S.C.R.

A pursuance of this Act, without giving to such person one month's
previous notice in writing of the intended suit or other proceeding
and of the cause thereof, nor after six months from the accrual of the
·cause of such suit or other proceeding'."

It is true that the constitutional validity of Section 87 of the Act which
B is equivalent to Section 120 of the present Act and similar in terms was not
directly in issue. Yet this Court examined the question of shorter period of
limitation prescribed under Section 87 of the Bombay Port Trust Act, 187.9.
With reference to the relatively longer period of limitation provided under
the Indian Limitation Act for filing of the suit and after examining the said
C issue the Court came to the conclusion that shorter period of limitation provided
under Section 87 of the Bombay Port Trust Act, 1879 was valid. It was
observed in para 38 :-

"38. If the person entitled to the goods defaults in removing them
within one month of the Board coming into custody, special powers
D of disposal by public auction are given by Section 64A. The Act
charges the port authorities with a wealth of functions and duties and
necessarily legal proceedings follow upon the defects, defaults and
other consequences of abuse of power. Even so, a public body

E
undertaking work of the sort which a port carries out will be exposed
to an explosive amount of litigation and the Board as well as its --
officers will be burdened by suits and prosecutions on top of the
pressure of handling goods worth crores daily, public bodies and
officers will suffer irremediably in such vulnerable circumstances·
unless actions are brought when evidence is fresh and before
delinquency fades; and so it makes sense to provide, as in many other
cases of public institutions and servants, a reasonably short period of
F
time within witich the legal proceedings should be started. This is
nothing unusual in the jurisprudence of India or England and is
constitutionally sound. ~ection 87 is illumined by the protective
purpose which will be ill served if the shield of a short limitation
operates in cases of misfeasance and malfeasance; but not non-
G feasance. The object, stripped .of legalese and viewed through the
glasses of simple sense, is that remedial process against official action
showing up as wrong doing or non-doing whiclt inflicts injury on a
citizen should not be delayed too long to obliterate the probative
material for honest defence.The d~chotoiny betweei:i act and omission,
however, logical or legal, has no relevance in this context. So the
H
V.M. SALGAOCAR v. BOARD OF TRUSTEES OF PORT OF MORMUGAO [BHAN, J.] 49

intendment of the statute certainly takes in its broad embrace all A
official action, positive and negative, which is the operative cause of
the grievance. Although the Act in the present case uses only the
expression 'act' and omits 'neglect' or 'default' or 'omission', the
meaning does not suffer and if other statutes have used all these
words it is more the draftsman's anxiety to avoid taking risks in B
Court, not an addition to the semantic scope of the word 'act'. Of
course, this is the compulsion of the statutory context and it may well
be that other enactments, dealing with different subject-matter, may
• exclude from an 'act' an 'omission'. This possibility is reduced a
great deal by the definition of 'act' in the various General Clauses
Acts, as including 'illegal omissions'." C
The question of considering the rationale of Section 87 of Bombay Port
Trust squarely arose in the said case as the contention was raised by the
Additional Solicitor General therein that if the argument of the respondent in
the said case was accepted, it would amount to misreading the purpose of
Section 87 of the Bombay Port Trust Act and similar provision in many D
statues calculated to protect public officers and institutions on a special basis.
(see paragraph 7 of the judgment). The Major Port Trusts Act, 1963 charges
the port authorities .with a well thought out duties and functions in respect of
providing port facilities and equipment and providing services for receiving,
landing and shipping of goods or passengers from and upon sea going vessels.
As a result of these multifarious functions, major ports and tl)eir officers are E
faced and burdened with an explosive amount of litigation. The object of
Section 120 is two fold, i.e. provision of giving one month's notice setting
out the cause of action is to give the port authorities an opportunity to consider
the merits of the case of the aggrieved party land make amends when possible
to save litigation. To ensure that legal action against port authorities and its F
officers is initiated expeditiously when evidence is fresh land does not
obliterate the probative material for honest defence.

The classification has a reasonable nexus to the object, it seeks to
achieve. The submission made on behalf of the appellant that though a suit
may be filed within six months, the trial of the suit could take place long G
after this and that the evidence would never be fresh at that stage is fallacious
in as much as once the suit is filed against a party, the party is put on notice
and will, therefore, gather the relevant documentary evidence when fresh and
preserve such evidence for the trial whenever the same would take place.
H
50 SUPREME COURT REPORTS [2005] 3 S.C.R.

A The submission of Shri R.F. Nariman, learned senior counsel appearing
for the appellant that in Indian ·Limitation Act, 1963 no provision for
condoriation of delay for institution of a suit has been made because a relatively
longer periods of limitation has been provided as compared to limitation
provided for appeals and other applications and, therefore, providing relatively
B shorter period of six months for filing the suit under the provisions of Section
120 of the Major Port Trusts Act, 1963 without a provision for condonation
of delay, would make the section arbitrary, excessive, disproportionate and
unreasonable restriction on the appellant's right under Article 14 and 19(1)(g)
of the Constitution of India cannot be accepted. The· statute of limitation is
founded on public policy that an unlimited and perpetual threat of litigation
•
C leads to disorder and confusion and creates insecurity and uncertainty.
Therefore the legislature has sought to balance the public interest in providing
limitation on the one hand and at the same time not to unreasonably restrict
the right of a party to initiate proceedings on the other. Once a suit is filed
the object- of limitation as- a statute repose is satisfied in as much as the
opponent party knows what he has to defend. The Major Port Trusts Act,
D 1963 is a special Act. It is a settled legal proposition that the provision of the
Special Act shall prevail over with the general Act. Section 29 of the Iridian
Limitation Act, 1963 relates to savings. For proper appreciatio'n of legal
position Section 29(2) of the Limitation Act is reproduced below :-

"Section 29(2) - Where any special or local law prescribes for any
E suit, app.eal or application a period of limitation different from the
period prescribed by the Schedule, the provisions of Section 3 shall
apply as if such period were the period prescribed by the Schedule
and for the purpose of determining any period of limitation prescribed
for any suit, appeal or application by any special or local. law, the
F provisions contained in Sections 4 to 24 (inclusive) shall apply only
in so far as, and to the extent to which, they are not expressly excluded
by such special or local law."

Sub-Section 2 of Section 29 envisages special or local laws which can
provide a periOd of limitation for suits as well as for appeals and applications,
G different from the period prescribed by the schedule of Limitation Act where
provisions contained in sJctions 4. to 24 can be expressly excluded by such
special or local laws. There are many special or local laws which provide for
a short period of limitation for filing of appeals as well as applications and
where the provisions of Section 5 are expressly excluded or curtailed. Under
H the Arbitration and Conciliation Act, 1996, Section 34 prescribes time limit
V.M. SALGAOCAR v. BOARD OF TRUSTEES OF PORT OF MORMUGAO [BHAN, J.] 5 I

within which an application for setting aside of a·n award must be made and A
although the Court is given the power to extend the time on sufficient cause
being shown, the said power to extend the time is restricted but a period of
30 days only and not thereafter.

It was then submitted by learned senior counsel for the appellant that
whereas Section 120 of the Major Port Trusts Act prescribes a limitation for B
six months plus one month of statutory notice for suits filed against the Port
Trust and its employees for anything done or purporting to have been done
• in pursuance of the Act, no limitation is prescribed for suits which are filed
by the Port Trust under Section 131 of the same Act without a rational basis.
We do not find any merit in this submission. It is well settled that alth~mgh C
limitation being intended for quieting title and in thai sense looks at the
problems from the point of view of the defendant with a view to provide him
security against the stale claims, addresses itself at the same time also to the
position of the plaintiff. The legislature in its wisdom can make separate
provision within which a suit must be filed by the i.ndividual from that within
which a suit can be filed by a statutory body. In Nav Ratanmal v. State of D
Rajasthan, AIR (1961) Supreme Court 1704 a similar argument was raised
and negatived by this Court. In that case the Court was examining as to
whether there was a rational basis for treating the Government differently as
regards period within which the suit could be filed by the Government on the
one hand and the private individual on the other. It was held that there were E
sufficient grounds for differentiating between the claims of an individual and
the claims of the Government and the actual period of limitation .which
should be allowed for filing the suit by any party was a matter of legish.tive
policy and cannot be brought within the scope or purview under Article 14
or any other Article of the Constitution. It was observed :- ;':~
F
"xxxx. It is with this background that the question of the special
pro\'ision contained in Article 149 of the Act has to be viewed. First,
we have the fact that in the case of the Government if a claim becomes
barred by limitation, the loss falls on the public, i.e., on the community
in general and to the benefit of the private individual who derives
advantage by the lapse of time. This itself would appear to indicate G
a sufficient ground for differentiating between the claims of an
individual and the claims of the community at large. Next, it may be
mentioned that in the case of govern~ental machinery, it is a known
fact that it does not move as quickly as in the case of individuals.
Apart from the delay occurring in .the proper officers ascertaining H
52 SUPREME COURT REPORTS (2005] 3. S.C.R.

A that a cause of action has accrued, Government being an impersonal '
body, before a claim is launched there has to be inter-departmental
correspondence, consultations, sanctions obtained according to the
rules. These necessarily take time and it is because of these features
which are sometimes characterised as red-tape that there is delay in
the functioning of Government offices.." ·
B
. With reference to the contention of Shri R.F. Nariman, learned senior
counsel appearing for the appellant that there is no reasons for prescribing a
shorter period of limitation for action against the Board while suits against
the Government can be filed within normal period of limitation, it may be
C stated that the Government cannot be equated with statutory body like the
Major Port Trust The Government is a vast organisation having comparatively
larger manpower and in the litigation against the Government subject matter
of disputes is under several different acts, such as Excise Act, Customs Act,
Income Tax Act, Railways Act, Land Acquisition· Act etc. Many of these
Acts also contain provisions similar to, if not identical with the provisions of
D Section 120 of the Major Port Trusts Act, 1963. Therefore, the contention

. . '
between a major port and Government as a wh.ole is totally fallacious.

A. provision of the Act providing for a shorter period of limitation
cannot be declared to be unconstitutional simply because in some of the
Statutes a longer period of limitation has been prescribed for the redressal of
E the liiisants grievances. The legislation enacted for the achievement of a
partic\i/ar object or purpose need not be all embracing. It is for the legislature
to de;i,rrnine what categories it would embrace within the scope of legislation
.J.~1 •
and ln'f'ely because certain categories which would stand on the same footing
·as t:r~ covered by the legislature are left out would not render the legislation
1
F. of ar._,Jlaw being discriminatory and violative of the fundamental rights
guaranteed under Article 14 and 19(1)(g) of the Constitution.

In the end Mr.. Nariman submitted that the Indian Ports Act, 1908 was
still applicable to various ports including Panjim Port in Goa. In the case of
exporters like the appellant using the port of Panjim, if the same controversy
G was to arise there being no provision such as Section 120 of the Major Port
Trusts Act, 1963 in the Indian Ports· Act, 1908 the period of limitation available
to such exporters would be three. years, that there was no intelligible differentia
with the objects sought and achieved in proceeding such as the provision as
Section 120. It may be stated that nowhere in the pleadi_~gs, is there an
H averrnent regarding the port of Panjim and in any case the very fact that the
V.M. SALGAOCAR "· BOARD OF TRUSTEES OF PORT OF MORMUGAO [BHAN, J.] 53

port of Panjim is not a major port and is not governed by the Major Port A .
Trusts Act, 1963 and is not enjoined to perform duties which a major port is
enjoined to perform is enough of an intelligible differentia which has a rational
nexus with the objects sought to be achieved.

For the aforesaid reasons, we do not find any merit in these appeals and
the appeals are dismissed leaving the parties to bear their own costs. B
D.G. Appeal dismissed.