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TMI Blog2008 (4) TMI 810X X X X Extracts X X X X X X X X Extracts X X X X ..... ng in the Tamil Nadu Electricity Board, pleaded with the management of the respondent to extend possible help. Accordingly, the respondent provided a loan to the appellant to the tune of ₹ 1,30,000/- in two installments, one on 19.08.1996 and another on 21.08.1996. Subsequently, the appellant had repaid a sum of ₹ 30,000/- on 12.09.1996 and with regard to the balance, the appellant had made assurances to make the payment within a period of one year. Since the appellant failed to pay the amount, the respondent as per letter dated 24.09.1999 wanted the appellant to pay the amount within three months and called upon the appellant to sign and send back the communication as a token of acceptance of the arrangement for repayment, and the same was signed and returned by the appellant. Subsequently, the respondent, as per notice dated 04.02.2000, claimed payment and in response to the said letter, the appellant, as per his reply letter dated 18.02.2000 acknowledged the liability, but pleaded for time on the ground that the medical reimbursement would be sanctioned to his wife by the first week of April 2000. Since the appellant was evading payment, the respondent again issued a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t and decree dated 23.03.2006 in A.S.No.46 of 2005 on the file of Principal District Judge, Madurai is the subject matter of the present appeal. 9. The Second Appeal was admitted by this Court on 18.04.2007 on the following two substantial questions of law: (i) Whether the finding of the lower Appellate Court that Exs.A.1 and A.3 are an acknowledgement of debt as under Section 25(3) of Indian Contract Act is correct under law, as the said provision is only applicable to the debt arisen from the business transaction that too there is a contract between the parties; and (ii) Whether Exs.A.1 and A.3 are not an acknowledgment of liability as it is time barred and hit by Section 18 of the Limitation Act. 10. In the above factual matrix, I have heard Mr.R.Surianarayanan, learned counsel appearing for the appellant and Mr.V.Ramakrishnan, learned counsel appearing for the respondent. 11. The learned counsel appearing for the appellant vehemently contended that the first appellate Court erred in decreeing the suit on the basis of Ex.A.3, and there was no unconditional acknowledgment in the said document and promise to pay the amount by the appellant. The learned counsel furt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ven an undertaking agreeing to pay the amount after receiving the same from the Tamil Nadu Electricity Board, where the wife of the appellant was employed. The said letter marked as Ex.A.3 has also been relied on by the first appellate Court to decree the suit, as according to the first appellate Court, the said letter could be construed as a promise within the meaning of Section 25(3) of the Indian Contract Act. 17. The learned counsel for the appellant, by placing reliance on the judgment of this Court in Shanmugam, S.A. v. P.V.S.Balusamy Chettiar reported in 2001(2) LW 686, contended that any acknowledgment should be made within the expiry of the prescribed period for instituting the suit and since acknowledgment was not given within three years from the date on which the amount was advanced by the respondent, the present suit is clearly barred by limitation. 18. Section 18 of the Limitation Act provides that 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 signed by the party against whom such property or right is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yer, the Tamil Nadu Electricity Board. Therefore, it cannot be said that the document in Ex.A.3 is an unconditional promise covered by Sub-Section 3 of Section 25 of the Indian Contract Act. 23. In N.Ethirajulu Naidu vs. K.R.Chinnikrishnan Chettiar reported in 1975(1) MLJ 11, Division Bench of our High Court had an occasion to consider the scope of Section 25(3) and S.Maharajan, J, speaking for the Bench observed thus: 9.......................... What the section requires is an express promise made in writing and signed by the person to be charged therewith. Nothing short of an express promise, therefore, will provide a fresh period of limitation. It is settled law that an implied promise is not sufficient. In fact, in Govindan Nair v. Achuthan Nair, this Court held as follows: The promise referred to in section 25, sub-section (3), Contract Act, must be an express one and cannot be held to be sufficient if the intention to pay is unexpressed and has to be gathered from a number of circumstances. In other words, there must be a distinct promise to pay before the document could be said to fall within the provisions of this section See Ramaswami Pillai v. Kuppuswami Pil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n case the date of grant of loan by the respondent is taken as the starting point of limitation, they should have filed the suit on or before 20.08.1999. The document in Ex.A.1 is dated 24.09.1999 and in view of the acknowledgment as found mentioned in Ex.A.1, the respondent is entitled for a fresh period of three years as provided under Section 18 of the Limitation Act. If the date of Ex.A.1 is taken as the starting point of limitation, the respondent ought to have filed the suit within a period of three years which expires on 23.09.2002. Admittedly, the suit was filed only in January 2003 and as such, Ex.A.1 will not come to the rescue of the respondent so as to save the suit from the statutory bar. Therefore, the suit is clearly barred by limitation. Though the substantial question of law with respect to Ex.A.1 is to be answered in favour of the respondent being an acknowledgment within the meaning of Section 25(3) of the Indian Contract Act and satisfies the conditions enumerated in Section 18 of the Limitation Act, still the suit is barred by limitation, inasmuch as the respondent failed to institute the suit within the period of three years from the date of Ex.A.1. 27. The ..... X X X X Extracts X X X X X X X X Extracts X X X X
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