A) ABSTRACT / HEADNOTE

The judgment examines the interplay between the Public Premises (Eviction of Unauthorised Occupants) Act, 1971 and the Limitation Act, 1963, particularly addressing whether recovery proceedings for arrears of licence fee under Section 7 of the PP Act are barred by limitation and whether acknowledgment of liability under Section 18 of the Limitation Act extends the limitation period. The dispute arose after the New Mangalore Port Trust revised licence fees retrospectively pursuant to a TAMP notification, and raised demands for arrears against licensees. While the revision itself had been upheld by a Single Judge of the High Court, the licensees resisted payment citing pendency of intra-court appeals. Subsequent statutory recovery proceedings were quashed by the District Judge and affirmed by the High Court on the ground of limitation.

The Supreme Court decisively held that once the Limitation Act is applicable to proceedings under the PP Act, all its provisions, including Section 18, apply. The Court interpreted written objections by the licensees, stating that payment was premature due to pending appeals, as a valid acknowledgment of liability, even though accompanied by a refusal to pay at that stage. The judgment clarifies that an acknowledgment need not be unconditional or immediate and that technical objections on limitation cannot be used to unjustly delay statutory dues. The Court further criticised the High Court for deciding the writ petitions without awaiting the outcome of pending intra-court appeals on the substantive tariff issue. The ruling reinforces doctrinal clarity on limitation, acknowledgment of debt, and procedural discipline in public revenue recovery.

Keywords:
Limitation; Acknowledgment of debt; Public Premises Act; Retrospective tariff; Licence fee recovery; Section 18 Limitation Act

B) CASE DETAILS

C) INTRODUCTION AND BACKGROUND OF JUDGEMENT

The dispute originates from the statutory powers of a major port authority to revise licence fees payable by private licensees occupying port land for commercial activities. The New Mangalore Port Trust, acting under tariff determinations approved by TAMP, revised licence fees retrospectively and sought to recover arrears from licensees. The revision itself was upheld by a learned Single Judge of the Karnataka High Court, thereby confirming the legality of retrospective tariff revision.

Despite the absence of any interim protection in pending intra-court appeals, the licensees resisted payment and consistently asserted that recovery should await final adjudication of those appeals. When statutory recovery proceedings were initiated under Section 7 of the PP Act, the licensees shifted their defence to limitation. The District Judge and High Court accepted this technical plea and nullified the recovery.

The Supreme Court was thus required to reconcile two competing considerations. One concerned the strict application of limitation law to statutory recovery proceedings. The other involved the equitable principle that a party cannot delay payment of public dues by taking inconsistent positions. The case also revisited the precedential authority of New Delhi Municipal Committee v. Kalu Ram, which had previously applied the Limitation Act to proceedings under the PP Act.

The judgment situates itself within a broader jurisprudential framework dealing with acknowledgment of liability, statutory recovery mechanisms, and the doctrine against unjust enrichment.

D) FACTS OF THE CASE

The appellant port trust allotted land to the respondents in 2003 for loading and unloading operations under licence agreements providing for revision of licence fees every five years. A notification dated 20.06.2005 revised fees retrospectively, followed by another TAMP-approved notification dated 23.07.2010 revising fees with effect from 20.02.2007.

Demands were raised for arrears covering the retrospective period. The licensees challenged the 2010 notification before the High Court, contending that retrospective revision was impermissible. These writ petitions were dismissed on 28.06.2013, with the Single Judge affirming the port trust’s authority to revise fees retrospectively.

Intra-court appeals against this decision were admitted but no interim relief was granted. Subsequent demand notices were issued, including a final notice dated 15.01.2015. In reply dated 04.02.2015, the licensees did not deny the quantum or liability but stated that payment was premature due to pendency of appeals and would prejudice their case.

The Estate Officer issued a statutory notice under Section 7(3) of the PP Act on 12.08.2015, followed by further correspondence and ultimately an order under Section 7(1) directing recovery as land revenue. Appeals under Section 9 succeeded before the District Judge solely on limitation grounds. Writ petitions challenging that decision were dismissed by the High Court, leading to the present appeals.

E) LEGAL ISSUES RAISED

i. Whether proceedings under Section 7 of the PP Act, 1971 are governed by the Limitation Act, 1963?
ii. Whether written objections deferring payment due to pending litigation constitute acknowledgment of liability under Section 18 of the Limitation Act?
iii. Whether recovery proceedings were barred by limitation computed from the date of tariff notification?
iv. Whether the High Court erred in deciding writ petitions despite pendency of intra-court appeals on the substantive issue?

F) PETITIONER / APPELLANT’S ARGUMENTS

The counsels for the appellant submitted that limitation objections were raised belatedly and that Section 7 of the PP Act prescribes no explicit limitation. Reliance was placed on New Delhi Municipal Committee v. Kalu Ram to submit that even assuming a three-year limitation applies, the respondents’ written replies amounted to acknowledgment under Section 18 of the Limitation Act, thereby extending limitation.

It was argued that the respondents never disputed liability or amount but only sought deferment pending appeals. Such conduct clearly attracted Explanation (a) to Section 18. The High Court was also faulted for proceeding with writ petitions despite pending intra-court appeals on tariff validity. Allowing the respondents to succeed on limitation would amount to unjust enrichment.

G) RESPONDENT’S ARGUMENTS

The counsels for the respondents argued that no acknowledgment of liability existed, as the replies expressly denied liability based on impermissible retrospective revision. They contended that Section 18 was never pleaded earlier and could not be invoked at the appellate stage.

It was further submitted that statutory proceedings commenced only in August 2015, beyond the three-year limitation period computed from 23.07.2010. Prior correspondence by estate officials could not be treated as statutory notices under the PP Act. The District Judge and High Court were therefore correct in quashing the proceedings.

H) RELATED LEGAL PROVISIONS

i. Section 7(1), PP Act, 1971
ii. Section 7(3), PP Act, 1971
iii. Section 9, PP Act, 1971
iv. Section 3, Limitation Act, 1963
v. Section 18, Limitation Act, 1963
vi. Article 52, Schedule to Limitation Act, 1963

I) JUDGEMENT 

The Supreme Court unequivocally held that once the Limitation Act applies to proceedings under the PP Act, selective application of its provisions is impermissible. The Court reaffirmed Kalu Ram and clarified that Section 18 applies equally.

The respondents’ written replies were analysed in detail. The Court held that stating that “time for payment has not yet come” due to pending appeals squarely falls within Explanation (a) to Section 18. The acknowledgment was made within the original limitation period, thus extending limitation up to 03.02.2018.

The Court rejected the contention that absence of pleading barred consideration of Section 18, noting that admitted documents and undisputed correspondence permitted pure legal determination.

The High Court’s approach was criticised for ignoring the pendency of intra-court appeals. The Supreme Court restored the writ petitions, directing they be heard after disposal of those appeals.

a) RATIO DECIDENDI

Acknowledgment of liability under Section 18 of the Limitation Act includes written statements deferring payment due to pending litigation, even when accompanied by refusal to pay at that stage. Once the Limitation Act applies to PP Act proceedings, all its provisions apply without exception.

b) OBITER DICTA

The Court observed that permitting licensees to avoid payment on technical limitation grounds despite losing on merits before the Single Judge would undermine public revenue administration and encourage strategic delay.

c) GUIDELINES

i. Courts must await outcome of pending intra-court appeals when issues overlap substantively.
ii. Written replies deferring payment may constitute acknowledgment under Section 18.
iii. Public authorities should not be non-suited on hyper-technical limitation pleas where liability is admitted in substance.

J) CONCLUSION & COMMENTS

The judgment reinforces doctrinal clarity on acknowledgment of debt and discourages tactical litigation designed to delay public dues. It balances statutory interpretation with equitable considerations and strengthens procedural discipline in public premises recovery. The ruling will significantly guide future disputes involving retrospective tariff recovery and limitation under special statutes.

K) REFERENCES

a) Important Cases Referred

i. New Delhi Municipal Committee v. Kalu Ram, [1976] Supp. 1 SCR 87

b) Important Statutes Referred

i. Limitation Act, 1963
ii. Public Premises (Eviction of Unauthorised Occupants) Act, 1971