#22
IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of decision: 16.08.2016
RFA 595/2016
M/S NATIONAL MINORITIES DEVELOPMENT
AND FINANCE CORPORATION ..... Appellant
Through: Mr. Danish Zubair Khan, Advocate
versus
M/S BHAGAT SINGH ORGANIZATION FOR
AWAKENING AND RURAL DEVELOPMENT
(THR ITS PRESIDENT) & ORS ..... Respondents
Through: None
CORAM:
HON'BLE MR JUSTICE SIDDHARTH MRIDUL
SIDDHARTH MRIDUL, J (ORAL)
CM APPL.29633/2016 (Exemption)
Exemption granted subject to all just exceptions.
The application is disposed of accordingly.
CM APPL.29695/2016 (Condonation of Delay in Refiling)
For the reasons stated in the application, which are duly supported by an
affidavit, the delay in refiling the accompanying appeal is condoned.
The application is disposed of accordingly.
RFA 595/2016 Page 1 of 5
RFA 595/2016 & CM APPL.29632/2016 (Condonation of Delay in Filing),
CM APPL.29631/2016 (Stay)
1. The present appeal under Section 96 of the Code of Civil Procedure,
1908 assails the judgment and decree dated 27.08.2015, passed by the
District & Sessions Judge (East), Karkardooma Courts, Delhi in CS
No.110/2015, titled "M/s National Minorities Development and Finance
Corporation vs. M/s Bhagat Singh Organization for Awakening and Rural
Development (Through its President) & Ors." whereby the said suit for
recovery of money, instituted on behalf of the appellant herein came to be
dismissed, as being barred by limitation.
2. Learned counsel appearing on behalf of the appellant canvasses a
solitary ground before this Court in the present appeal. It is urged on behalf
of the appellant that the guarantee executed by the defendant was in the
nature of a continuing guarantee and that consequently, since the appellant
kept issuing demand notices invoking the said guarantee, the period of
limitation came to be extended on account of the acknowledgement of debt,
in terms of Section 19 of the Limitation Act, 1963 (hereinafter referred to as
the 'said Act').
3. In this behalf, it would be expedient to consider the provision of
Section 19 of the said Act:-
"19. Effect of payment on account of debt or of interest
on legacy. - Where payment on account of a debt or of
interest on a legacy is made before the expiration of the
prescribed period by the person liable to pay the debt or
legacy or by his agent duly authorised in this behalf, a fresh
period of limitation shall be computed from the time when the
payment was made:
RFA 595/2016 Page 2 of 5
Provided that, save in the case of payment of interest
made before the 1st day of January, 1928, an
acknowledgement of the payment appears in the handwriting
of, or in a writing signed by, the person making the payment.
Explanation. - For the purpose of this section, --
(a) Where mortgaged land is in the possession of
the mortgagee, the receipt of the rent or produce
of such land shall be deemed to be a payment;
(b) "debt" does not include money payable under a
decree or order of a court."
4. A plain reading of the above provision clearly postulates that where a
payment is made on account of a debt, before the prescribed period of
limitation under the said Act expires, by the debtor, a fresh period of
limitation is set into motion from the time such payment is made.
5. In the present appeal, it is observed that subsequent upon the
disbursement of the loan on 23.12.2000, the appellant has not averred that
any payment has been received from the defendants.
6. In this backdrop, the learned trial court dismissed the suit with the
following order:-
" Vide this order, I shall dispose arguments on the point
of limitation. Present suit has been filed by the plaintiff
against defendants for recovery of Rs.6,83,594/- (Rupees Six
Lacs Eighty Three Thousand Five Hundred Ninety Four).
Facts
as mentioned in the plaint are that defendant No.1 Society requested the plaintiff for financial assistance by way of loan and the plaintiff sanctioned loan under Micro Credit Scheme and sanctioned loan in two installments. First installment of Rs.4,50,000/- was released vide bank draft dated 29.03.2003 and the second installment of the same amount was released on 29.07.2004. The plaintiff requested RFA 595/2016 Page 3 of 5 the defendants several times to refund the loan amount but defendants avoided to pay back the same on one pretext or the other. As per statement of account, a sum of Rs.6,83,594/- (Rupees Six Lacs Eighty Three Thousand Five Hundred Ninety Four) was as on 16.06.2014. Demand notice dated 24.06.2014 was sent to the defendants calling upon them to repay the amount due, but of no avail.
2. Perusal of the averments of the plaint shows that the plaintiff has sought to recover the loan amount advanced in the year 2003/2004 in two installments and last installment was released to the defendants on 29.07.2004. Though, documents such as loan agreement, disbursement slip etc. have been filed on record. Limitation for recovery of loan amount is three years. But there is nothing on record to show that defendants have acknowledged their liability in the last three years. No reply has been received by the plaintiff from the defendant in response to demand notice sent whereby defendants had acknowledged the liability. Merely sending demand notice to the defendant can not extend the limitation. Limitation can be extended only by way of acknowledgement of debt in writing or part payment of debt as provided under Sections 18 and 19 of the Limitation Act, 1963. In the absence of any document i.e. acknowledgement of debt in writing or part payment of debt allegedly made by the defendants, I hold that there is inordinate delay in filing of the present suit. Claim being barred by limitation, present suit is liable to be dismissed. Accordingly, present suit is dismissed, being barred by limitation. Decree sheet be drawn.
File be consigned to record room."
7. It is trite to state that the Court has no discretion to extend the period of limitation prescribed by the said Act, except insofar as it falls within the mandate of the provisions contained in Sections 4 to 24 (inclusive) of the said Act.
8. In the present case, in my view, in the facts and circumstances, the submission made on behalf of the appellant to the effect that there was an acknowledgement on the part of the defendants, in view of the guarantee RFA 595/2016 Page 4 of 5 furnished by the latter, which according to them was a continuing guarantee and extended the period of limitation on account of acknowledgement of debt, is fallacious and devoid of merits. There admittedly is no other acknowledgement of debt in writing by the defendants apart from this unsupported argument of "continuous guarantee" set up by the appellant. Thus, the provision of Section 19 of the said Act, are not attracted to the facts of the present case.
9. The suit being CS No.110/2015, titled "M/s National Minorities Development and Finance Corporation vs. M/s Bhagat Singh Organization for Awakening and Rural Development (Through its President) & Ors.", instituted on behalf of the appellant was patently barred by time in view of the findings of the trial court, which have not been controverted on behalf of the appellant. Accordingly, its dismissal as being barred by limitation cannot be found fault with.
10. Since no other ground has been urged on behalf of the appellant in the present appeal, I confirm the decision arrived at by the trial court, which has been impugned in the appeal.
11. The appeal is accordingly dismissed. Pending applications also stand disposed of.
SIDDHARTH MRIDUL, J AUGUST 16, 2016 dn RFA 595/2016 Page 5 of 5