The Limitation Act, 1963
PART II: LIMITATION OF SUITS, APPEALS AND APPLICATIONS
Section 11: Suits On Contracts Entered Into Outside The Territories To Which The Act Extends
Bare Act
(1) Suits instituted in the territories to which this Act extends on contracts entered into in the State of Jammu and Kashmir or in a foreign country shall be subject to the rules of limitation contained in this Act.
(2) No rule of limitation in force in the State of Jammu and Kashmir or in a foreign country shall be a defence to a suit instituted in the said territories on a contract entered into in that State or in a foreign country unless:
- (a) the rule has extinguished the contract; and
- (b) the parties were domiciled in that State or in the foreign country during the period prescribed by such rule.
Simplified Act
(1) If you file a lawsuit in the areas where this law is applied, based on a contract made in the State of Jammu and Kashmir or in another country, the time limits for when you can sue (known as statutes of limitations) are determined by this law, not by the laws of Jammu and Kashmir or the other country.
(2) You can't use the time limit rules from Jammu and Kashmir or another country to defend against a lawsuit filed in these areas based on a contract made there, unless two conditions are met:
- (a) The contract has been legally destroyed or ended by those rules; and
- (b) All the people involved in the contract were living in Jammu and Kashmir or the other country for the entire time set by those rules.
Explanation using examples
Imagine a scenario where an Indian company, based in Mumbai, enters into a contract with a company in Paris, France. The contract includes a clause stating that any disputes arising from the contract will be subject to the jurisdiction of Indian courts. Two years after the contract is signed, a dispute arises, and the Indian company decides to sue the French company.
Under Section 11(1) of The Limitation Act, 1963, the Mumbai court will apply the Indian Limitation Act to determine if the lawsuit is filed within the permissible time limit, even though the contract was entered into in France.
Furthermore, suppose the French company argues that according to French law, the claim is already time-barred and thus cannot be brought to court. According to Section 11(2), this argument will not hold unless the contract itself has been extinguished by the French limitation period and both parties were domiciled in France during that period. Since the Indian company is based in Mumbai, this defence is likely to fail, and the Indian Limitation Act will govern the case.
