Delhi High Court
Manoj Kumar Goyal vs Jagdish Prashad Modi on 13 February, 2014
Author: Sanjeev Sachdeva
Bench: Sanjeev Sachdeva
*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 ======================================================================= CS(OS) 2321/2011 Page 1 of 10 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 ======================================================================= CS(OS) 2321/2011 Page 2 of 10 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 ======================================================================= CS(OS) 2321/2011 Page 3 of 10 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 ======================================================================= CS(OS) 2321/2011 Page 4 of 10 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, ======================================================================= CS(OS) 2321/2011 Page 5 of 10
(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 ======================================================================= CS(OS) 2321/2011 Page 6 of 10 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 ======================================================================= CS(OS) 2321/2011 Page 7 of 10 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 ======================================================================= CS(OS) 2321/2011 Page 8 of 10 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 ======================================================================= CS(OS) 2321/2011 Page 9 of 10 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 ======================================================================= CS(OS) 2321/2011 Page 10 of 10