The plaintiff has to plead and prove two ingredients i.e. existence and discovery of fraud to invoke section 17 of the Limitation Act, observed the Supreme Court.
Section 17 of the Limitation Act says that when the suit is based on the fraud of the defendant, the period of limitation shall not begin to run until the plaintiff or applicant has discovered the fraud. It deals with the effect of the fraud on the limitation period for instituting a suit.
Justices A. M Khanwilkar and Dinesh Maheshwari observed: “For invoking Section 17 of the 1963 Act, two ingredients have to be pleaded and duly proved. One is existence of a fraud and the other is discovery of such fraud”.
The dispute between the parties pertains to a General Power of Attorney (GPA) , have been executed by the plaintiff on 28.06.1990 in favour of defendant No. 1 and consequently sale deeds executed by defendant No. 1 as an attorney of the plaintiff. Plaintiff challenged the sale deeds as fraudulently got executed by the defendant.
The Supreme Court held that, the documents were registered and the court held that, the onus is on the plaintiff to prove the defects in the documents, as a registered document is presumed to be genuine as settled by the precedent Prem Singh and Ors. v. Birbal and Ors (2006) 5 SCC 353.
By examining the attesting witnesses in terms of section 68, 69 and 67 of the Evidence Act, the defendant has proved the documents, Court noted.
The mere existence of a fiduciary relationship was not sufficient to shift the burden of proof to the defendants, Court further observed.
“The requirement regarding shifting of burden onto the defendants had been succinctly discussed in Anil Rishi v. Gurbaksh Singh (2006) 5 SCC 558 , wherein this Court had held that for shifting the burden of proof, it would require more than merely pleading that the relationship is a fiduciary one and it must be proved by producing tangible evidence”, the SC observed.
The plaintiff failed to establish both the existence and discovery of fraud. Therefore, the benefit of Section 17 was held to be not applicable, the Court held after elaborately discussing the facts of the case.
The suit was held to be time-barred.
Case: Rattan Singh vs.Nirmal Gill [CIVIL APPEAL NOS. 36813682 OF 2020]
Coram: Justices AM Khanwilkar and Dinesh Maheshwari
Counsel: Sr. Adv T.S. Doabia, Advocates Jagjit Singh Chhabra, Subhashish Bhowmi