Running account limitation in winding-up claims can extend with last payment and support recovery of the balance due.

In a winding-up claim founded on a running and continuous account, limitation was treated as governed by Article 137 of the Limitation Act read with Section 19 and the extended period under Section 458A of the Companies Act. Ledger entries, bills, payments, and the last payment within the relevant period were relied on to show a subsisting balance, and the limitation objection failed. On the merits, the account records were accepted as reliable, the underlying bills were not effectively disputed, and no material showed payment or settlement, so the balance in the running account was recoverable by the official liquidator.

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Issues: (i) Whether the official liquidator's claim was barred by limitation; (ii) Whether the official liquidator was entitled to recover the amount claimed.

Issue (i): Whether the official liquidator's claim was barred by limitation.

Analysis: The limitation period was held to be governed by Article 137 of the Limitation Act, 1963, read with Section 19 of that Act and Section 458A of the Companies Act. The account was treated as a running and continuous account on the basis of the ledger entries, bills, and payments reflected in the records. The last payment made within the relevant period was taken into account, and the filing of the company application within the extended period under Section 458A was accepted. The provisions of Sections 59 to 61 of the Indian Contract Act, 1872 did not assist the respondent in displacing this conclusion.

Conclusion: The claim was not barred by limitation and the issue was decided in favour of the applicant.

Issue (ii): Whether the official liquidator was entitled to recover the amount claimed.

Analysis: On the merits, the respondent did not effectively dispute the underlying bills and account entries, and there was no material showing that the amounts had been paid or otherwise settled. The books and ledgers relied upon by the official liquidator were accepted as reliable, and the balance shown in the running account was found recoverable.

Conclusion: The official liquidator was entitled to recover Rs. 1,47,797.60 with interest at 12% per annum from 30 August 1984 till payment, in favour of the applicant.

Final Conclusion: The company application succeeded, the limitation objection failed, and the decretal amount with interest was directed to be paid to the official liquidator.

Ratio Decidendi: In a winding-up claim founded on a running and continuous account, the court may compute limitation by applying Article 137 of the Limitation Act, 1963 together with Section 458A of the Companies Act, and the last payment on account can extend limitation where the account and payments support a subsisting balance due.

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