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4. I fail to understand what the learned Judge meant in stating that "his mere words cannot be accepted." If "his" refers to the plaintiff, as I think it does, there-must have been some misapprehension in the mind of the learned Judge. The plaintiff does not rely upon his own words but those of the defendant who acknowledged his liability by executing the document, handed over to the plaintiff, and which established that the defendant was on its date indebted to the plaintiff to the extent of Rs. 250. What a party himself admits to be true should be accepted to be so until the contrary is proved, a proposition so well established that no authority need be quoted in support of it. The narrow issue which arose in the case-could only have been answered in the affirmative, and the indebtedness of the defendant having been thus found and no other defence having been raised a decree in favour of the plaintiff should have followed. The learned advocate for the respondent has argued before us that the acknowledgment in question not being account stated" to which Article 64, Lim. Act, refers or the statement of a "balance due on a mutual, open and current account" to which Article 85 of the aforesaid act refers cannot be the foundation of a suit and that the only use which can be made of an acknowledgment like the one in question is to save limitation under Section 19, Lim. Act, provided it can be shown that all the items which had been brought into account were within limitation on the date of the acknowledgment. To my mind every one of these arguments assumes some fact or other and puts the plaintiff to proof of the contrary at a. stage when it is impossible for him to do so and when it is highly unjust to require him to substantiate it. I see no reason why we should assume that the transactions between the parties were not of a character that the balance acknowledged cannot be said to be account stated or that it was not the balance of a mutual open and current account. Such a plea should have been taken at the earliest stage to give the plaintiff notice of the ground on which his right of suit is-challenged. If the plea had been taken he might have produced his accounts to show that it was a case of the kind which, according to defendant's argument, entitles the plaintiff to sue on a mere acknowledgment. I am of opinion that the defendant is not entitled to take the plea involved in the argument addressed to us. Nor is it open to the plaintiff or to the defendant to ask us to treat the acknowledgment as one merely saving limitation in respect of advances made prior to the acknowledgment, as the plaintiff's suit is not based on the original debt which became merged in the acknowledgment. The only question is whether the plaintiff is entitled to sue basing his claim on the acknowledgment itself. Granting it is open to the defendant at this stage to ask us to assume that the acknowledgment has no reference to such transactions as would make it an account stated or that the balance therein acknowledged is not the balance of a mutual, open and current account, I am nevertheless of opinion that it could be the foundation of a suit. It is clearly an acknowledgment of the description given in Article 1, Section 1, Stamp Act, which provides a duty of one anna for Rs. 20 or more acknowledged therein. The language of the article is important and may be usefully quoted:

No doubt, as pointed out in the Bombay case Shanker v, Mulsta [1898] 22 Bom. 513 in England an acknowledgment if unconditional is held to be sufficient evidence of a new contract which can be sued Upon but there no difficulty arises with reference to the law of limitation because an un conditional acknowledgment takes a case out of the statute of limitation whether it is made before or after the period of limitation expires. In India it is otherwise. An acknowledgment in writing signed by a debtor provides a fresh period of limitation only if it is made before the period of limitation expires. After the period expires nothing short of a fresh contract will revive the debt and provide a fresh period of limitation. If it were held that an acknowledgment of debt is evidence of a new contract which may be sued upon then Section 19 of that Act would be a dead letter.

In one sense it is possibly correct to say that a man does not ordinarily acknowledge a liability which he knows to have become statute barred; but the possibility of such an acknowledgment was clearly contemplated by the Legislature when drawing up the relevant clause of the Limitation Act. It required to be laid down that in order to save limitation an acknowledgment must be made before the period of limitation in respect of the liability so acknowledged had expired; and in so doing the legislature clearly contemplated the possibility of acknowledgments being made of statute barred debts. If the Courts are in a general way to act upon the sort of principle involved in the words which I have quoted from the judgment of Pearson, J., the result will be that an acknowledgment made within 60 years of the limitation period prescribed for the institution of any suit will have to be treated as ordinarily sufficient to save limitation unless and until the party bound by that acknowledgment is able to prove affirmatively that it was made boyond limitation. I do not think this is a sound principle, or was intended by the legislature.

47. The question whether a mere acknowledgment or a simple receipt can be made the basis of a suit is one more of procedure than of substantive law. If the transaction has amounted to a new contract it can undoubtedly be made the basis of a suit. But if it is nothing more than a mere acknowledgment then, if made beyond the period of limitation, it cannot be the basis of a fresh suit which can succeed. If however the acknowledgment had been made within limitation, then the cause of action is kept alive and all that would be at most necessary would be an amendment of the plaint, if the original debt is not referred to therein. The learned Judges of the Bombay High Court in Chunni Lal v. Lakshman A.I.R. 1922 Bom. 183, although they expressed the opinion that the acknowledgment having been made before the limitation period had expired, implied an unconditional promise to pay and could be made the basis of the suit, also remarked at p. 28 that in any event the only penalty which could fall on the plaintiff would be to have to amend his plaint so as to implead the previous transaction.