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TMI Blog1992 (11) TMI 287X X X X Extracts X X X X X X X X Extracts X X X X ..... dant No. 2 who was the guarantor executed an acknowledgment Exh. 39 acknowledging the liability in the amount of ₹ 2,17,532/-, inclusive of interest upto 30.6.1984, and further binding him for repayment of the said amount in accordance with the relevant agreement executed by him and obligations undertaken thereunder. It is further the case of the plaintiff Bank that on 4.12.1985, the defendant No. 1 himself had acknowledged the liability in the amount of ₹ 2,27,969/- inclusive of interest upto 13.10.1985 by executing the document to that effect which is Exh. 40 by which he had also undertaken to repay that amount with future interest and other charges etc. in accordance with agreement/obligations etc. undertaken by him. 3. According to the plaintiff Bank the LPD. A/c-59/85 of the defendant No. 1 showed that as on 7.1.1987 an amount of Rs.. 2,34,726.13 ps. was due in the account of the defendant No. 1 whereas upto that day he has made payment of ₹ 3,953/-. It is its case that no interest was charged in this LPD. A/c 59/85 from 14.10.1985. Therefore, when no payment was made in this account by the defendant No. 1 the suit was filed by the plaintiff bank on 29.4.1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plaintiff Bank, it is entitled even upon the acknowledged amount as per Exh. 40 which the learned trial Court has not granted. Further, according to the plaintiff Bank if it is entitled to the contractual rate of interest upon the amount acknowledged by the defendant No. 1 till the date of the suit, then since the transaction is a commercial transaction, it is also entitled to further interest from the date of the suit till its realisation at the same rate of interest instead of a meagre rate of interest of 6% P.A. granted by the learned trial Court. 9. In reply, it is urged on behalf of the defendant No. 1 that although he has not preferred any appeal or cross-objection, we should dismiss the suit of the plaintiff Bank itself by exercising power under Order 41, Rule 33 of C.P.C. since the suit is barred by time and there is an obligation on the Court to dismiss the suit barred by time even though such a plea is not raised. It is urged before us that the plaintiff Bank is not entitled to interest, at any rate since the principle claim itself is barred by time. As regards the finding rendered by the learned trial Court that the plaintiff Bank is entitled to charge interest at the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 30.8.1984 would extend the period of limitation in view of section 19 of the Limitation Act. The learned Counsel for the defendant No. 1 has brought to our notice the requirements of the proviso to section 19 of the Limitation Act, 1963. The submission based upon the said proviso is that for claiming extension of the limitation, it is necessary for the debtor to prove that the acknowledgement of the repayment is in the handwriting of, or is in writing signed by, the person claiming the repayment. He has urged before us that mere admission of repayment either in the written statement or in the evidence as in the instant case cannot enure to the benefit of the principal debtor for extension of limitation under section 19 of the Limitation Act. 12. In support of the above proposition, the learned Counsel for the defendant No. 1 has relied upon the judgment of the Supreme Court in the case of Sant Lal Mahton v. Kamla Prasad and others, . Perusal of the facts in the said case would show that the principal debtor therein had acknowledged the repayments in written statement. Even then the Supreme Court had held that unless as per the requirement of the proviso there is an acknowled ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... covered by section 25(3) whereas according to the learned Counsel for the respondent No. 1 the promise to pay the time barred debt must be express and in writing. In support of his submission, the learned Counsel appearing for the plaintiff Bank has relied upon the judgment of the learned Single Judge of this Court in the case of M/s R. Sureshchandra Co. v. M/s Vadnere Chemical Works and others, , and also upon the judgment of another learned Single Judge of this Court in the case of M/s. Manekchand Mohanala v. Shah Bhimji and Co., 1969 Mah.L.J. 698. 16. The learned Counsel appearing for the defendant No. 1 has, however, relied upon the decision of the Division Bench of this Court in the case of Manganlal Harjibhai others v. Aminchand Gulabji and others, A.I.R. 1928 Bom. 319, and in the case of Balkrishna Mansukhram v. Jayshankar Narayan, A.I.R. 1938 Bom. 460. Besides the judgment of the Division Bench Maganlal v. Amichand, (cited supra), he has also relied upon the judgment of the erstwhile Lahore High Court in the case of Basheshar Nath Goela v. Baji Nath others, A.I.R. 1938 Lah. 264, and the judgment of the Full Bench of the Kerala High Court in the case of Chacko Varke ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de by him. The clause until the repayment of the liabilities in the respective account in full are made by him. would clearly indicate that the defendant No. 1 had acknowledged and had promised to pay the acknowledged amount with interest in accordance with the agreements, obligations etc. which were to remain in force till the repayment of the liabilities in his account was made in full. 19. Although we thus accept the submission on behalf of the learned Counsel for the defendant No. 1 as regards the construction of section 25(3) of the Contract Act, we do not accept his contention that there is no express promise to pay in the acknowledgment of the defendant No. 1 (Exh. 40). Once it is held that there is an express promise to pay the time barred debt within the meaning of section 25(3) of the Contract Act, the said acknowledgment would be an agreement and there would be a fresh period of limitation from the date of the said acknowledgment within which period the suit of the plaintiff Bank is within time. As it is held that the suit of the plaintiff Bank is not barred by time, further submission made on behalf of the defendant No. 1 that, although no appeal or cross-objection ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dgment executed by the defendant No. 2 (Exh. 39) is not binding upon the principal debtor i.e. the defendant No. 1, while granting the decree without including interest it has taken into consideration the amount of ₹ 2,17,532/- acknowledged by the defendant No. 2, which it could not have done. Once the acknowledgment of the defendant No. 1 is treated as a promise to pay the time barred debt within the meaning of section 25(3) of the Contract Act, it is the amount which is acknowledged by him which would have to be taken into account by the leaned trial Court. Hence, its decree is erroneous and has to be modified by decreeing the claim made by the plaintiff Bank as shown hereinbefore in the previous para. 23. The next question which needs consideration is about the future interest from the date of the suit till realisation. In this regard, it may be seen that section 34 of the C.P.C. permits interest upon the principal sum adjudged by the learned trial Court. The learned Counsel for the defendant No. 1 has urged before us that in view of the judgment of the Full Bench of his Court in the case of Union Bank of India, Bombay v. Dalpat Gaurishankar Upadyay, , the principal sum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of interest from the date of suit till realisation. 26. The learned Counsel for the defendant No. 1 has, however, urged before us that the future interest from the date of the suit till realisation should not be granted at the contractual rate of interest taking into consideration the facts and circumstances in the instant case. According to him, the defendant No. 1 belonged to the category of the educated unemployed whose case for sanction of loan by the plaintiff-Bank was recommended, by Mahatma Fule Magasvargiya Sanstha which had advanced the seed money to him for purchase of truck at the nominal rate of simple interest of 4% P.A. only. It is also urged that the defendant No. 1 has paid the substantial amount of ₹ 52,000/- to the plaintiff-Bank. In fact, according to him the transaction itself is not a commercial transaction within the meaning of the Explanation 2 to section 34 of the C.P.C. As regards the question whether it is commercial transaction or not, we do not propose to allow the defendant No. 1 to raise this question at the time when the judgment was dictated and completed upto the question of future interest because elaborate arguments are necessary on this ..... X X X X Extracts X X X X X X X X Extracts X X X X
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