Manoj Kumar Goyal vs Jagdish Prashad Modi
2014 Latest Caselaw 835 Del

     *IN THE HIGH COURT OF DELHI AT NEW DELHI

%                         Order Reserved on: 8 th January, 2014
                          Pronounced on: 13 th February, 2014

+                   CS(OS) 2321/2011

MANO J K UMA R GOYAL                                ..... Plaintiff

                          Through      Mr. Madan Mohan,
                                       Advocate

                          versus

JAGDISH PRA SHAD MODI                               ..... Defendants

                          Through      Ms. Rashmi B. Singh,
                                       Advocate.

       CORAM:

       HON'BLE MR. JUSTICE SANJEEV SACHDEVA


SANJEEV SACHDEVA, J.

1. Vide order dated 30.7.2012, the issue s were framed in

the suit and the issue "whether the suit is barred by

limitation?" was treated as preliminary issue.

2. The plaintiff has filed the present suit seeking reco very

of a sum of Rs.35,14,100/-. The case of the plaintiff is

that the defendant had obtained a loan of =======================================================================

Rs.10,37,000/- from the plaintiff on interest payable at

market rate, i.e., 2% per month on 1.5.2001 and

executed a receipt for the same. As per the plaintiff,

the defendant had undertaken to discharge the liability

within two years with interest.

3. The defendant is stated to have paid a sum of

Rs.20,000/- on 16.04.2003 and executed a document

for the same undertaking to pay the balance amount

within six months. The defendant once again is

claimed to have paid a sum of Rs. 30,000/- on

14.04.2006 and agreed to pay the balance amount

with interest within six months and executed a written

acknowledgement for the same. As per the plaintiff,

once again on 10.06.2009, the defendant paid another

sum of Rs.25,000/- and agreed to pay the balance

amount within six mo nths along with interest. The

acknowledgment dated 10.06.2009 is stated to have

been executed within a period of three years from the

expiry of the six months stipulated vide

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acknowledgment dated 14.04.2006.

4. As per the plaintiff, since the defendant failed to pay

the amount within the period stipulated, the present

suit was filed on 04.08,2011.

5. The defendant has disputed the taking of loan and has

submitted that the documents are forged and

fabricated.

6. The defendant has raised a plea that the suit is barred

by limitation as the loan was allegedly granted on

01.05.2001 and the suit has been filed on 04.08.2011.

Learned counsel for the defendant submits that even if

the three writing, i.e. writing dated 16.4.2003,

12.4.2006 and 10.6.2009 were taken into account, the

suit would be still barred by limitation as in terms of

Section 18 of the Limitation Act, 1963 (hereinafter

referred as the Act) for the limitation to be extended,

the acknowledgement has to be executed within a

period of thre e years from the date the cause of action

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arises. For the period of limitation to be extended , the

document has to be executed within the existing

period of limitation. Learned counsel further contends

that if any document is executed after the expiry of

period of limitation, the same will not extend limitation.

7. Learned counsel for the defendant submits that the

third alleged acknowledgement, i.e., document dated

10.06.2009 has been executed admittedly beyond a

period of three years from the last alleged

acknowledgement of 14.04.2006 and as such, the suit

even on the showing of the plaintiff is barred by

limitation.

8. Section 18 of the Act, lays down as under:

"18. Effect of acknowledgment in writing.--

(1) Where, before the expiration of the prescribed period for a suit or application in respect of any property or right, an acknowledgment of liability in respect of such property or right has been made in writing

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signed by the party against whom such property or right is claimed, or by any person through whom he derives his title or liability, a fresh period of limitation shall be computed from the time when the acknowledgment was so signed.

(2) Where the writing containing the acknowledgment is undated, oral evidence may be given of the time when it was signed; but subject to the provisions of the Indian Evidence Act, 1872 (1 of 1872), oral evidence of its contents shall not be received.

Explanation.- For the purposes of this section,-

(a) an acknowledgment may be sufficient though it omits to specify the exact nature of the property or right, or avers that the time for payment, delivery, performance or enjoyment has not yet come or is accompanied by a refusal to pay, deliver, perform or permit to enjoy, or is coupled with a claim to set - off, or is addressed to a person other than a person entitled to the property or right,

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(b) the word" signed" means signed either personally or by an agent duly authorised in this behalf, and

(c) an application for the execution of a decree or order shall not be deemed to be an application in respect of any property or right."

9. In terms of Section 18 of the Act, if before the expiry of

the prescribed period for filing a suit an

acknowledgement of liability is made in writing by the

party against whom such claim is made a fresh period

of limitation shall be computed from the time when the

acknowledgement was so signed. If a person availing

a loan before the expiry of the period of limitation for

filing the suit acknowledges his liability in writing, then

the lender gets a fresh period of limitation for filing the

suit.

10. The question that arises for consideration is whether

the fresh period of limitation would commence from

the date of execution of the document acknowledging

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the debt or from the expiry of the period stipulated in

the acknowledgment for payment if any such period is

stipulated.

11. The debt was allegedly given on 01.05.2001 and a

receipt executed for the same . It was further

acknowledged and undertaken to be re-paid within six

months by a document executed on 16.04.2003 and

the said acknowledgment was accompanied with a

payment of Rs.20,000/-. This acknowledgement dated

16.04.2003 was within a period of three years from the

alleged creation of the debt. Similarly the

acknowledgement dated 14.04.2006 was within thr ee

years of 16.04.2003 and the acknowledgment of

14.04.2006 was accompanied by a payment of

Rs.30,000/- and an undertaking to pay the balance

amount with interest within six months. Further there is

reliance on the acknowledgement dated 10.06.2009

which was also coupled with a payment of Rs.25,000/ -

and an undertaking to pay the balance amount within

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six months. The acknowledgement of 10.06.2009 is

not within three years of the acknowledgment dated

14.04.2006 but is within three years of the six months

period stipulated for payment in the acknowledgment

dated 14.04.2006.

12. The question then is whether the limitation to file the

suit would commence from the date of the

acknowledgment or from the expiry of the period

stipulated in the acknowledgment for payment. This

question would not arise in a case where the

acknowledgement does not stipulate any period for

payment, in which case the limitation would

commence from the date of the acknowledgment.

13. The acknowledgement dated 14.04.2006 stipula ted a

six months period for payment. The defendant could

have paid the said amount anytime within the

stipulated period of six months. The plaintiff had to

wait for the expiry of the period of six months before

filing a suit. In case a suit were to be file d before the =======================================================================

expiry of the period stipulated for payment, the suit

would be premature.

14. If a person has promised to do a particular act within a

stipulated period, then the cause of action to sue for

breach of the promise would accrue either on the

specific refusal of the promisor to perform the said

promise or on the expiry of the period stipulated for

the performance.

15. The cause of action to sue for recovery accrue s to a

party only on the failure of the other party to pay within

stipulated period for paymen t. In the facts of the

present case the cause of action to sue on the said

written acknowledgement of 14.04.2006 would accrue

to the plaintiff only on the failure of the defendant to

pay on the expiry of six months of 14.04.2006, i.e., on

13.10.2006. Thus the acknowledgement dated

10.06.2009 is a written acknowledgement in terms of

Section 18 of the Act and executed within the period of

limitation of the acknowledgement dated 14.04.2006 =======================================================================

as it was coupled with a payment of Rs.30,000/- and

an undertaking to pay the balance amount within six

months. The suit of the Plaintiff is prima facie held to

be within time.

16. The question whether the documents are forged or

fabricated is a disputed question of fact which would

be decided after the trial of the suit. If after the trial the

court comes to a conclusion that any of the

acknowledgments are forged and fabricated then the

suit would be liable to dismissed as being barred by

limitation.

17. Nothing stated herein would amount to an expression

on the merits of the case of either party.

SANJEEV SACHDEVA, J

February 13, 2014 sv

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