Accounts stated and unconditional balance acknowledgment can support recovery where mutual dealings are adjusted and fraud is unproved.

Where businessmen with mutual dealings signed a balance in the plaintiffs' ledger after adjustment of accounts, the Court accepted the stated balance as genuine because the defendants withheld their own books, gave evasive evidence, and failed to prove fraud, coercion, misrepresentation, or non-explanation of accounts. The contemporaneous endorsement supported a real settlement of accounts, and adverse inference could be drawn from the non-production of the best evidence. An unconditional acknowledgment of the struck balance was treated as an implied promise to pay and, in the context of stated accounts, furnished a maintainable basis for recovery. The plaintiffs' claim was therefore upheld.

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Issues: (i) Whether the defendants had signed the balance entry after understanding and adjusting the mutual accounts, or whether the signatures were vitiated by fraud, coercion, misrepresentation, or non-explanation of accounts; (ii) Whether an unconditional acknowledgment of balance struck in the ledger, in the setting of mutual dealings and stated accounts, furnished a maintainable cause of action for the suit.

Issue (i): Whether the defendants had signed the balance entry after understanding and adjusting the mutual accounts, or whether the signatures were vitiated by fraud, coercion, misrepresentation, or non-explanation of accounts.

Analysis: The entry was signed by both defendants in the plaintiffs' ledger after long-standing mutual dealings between businessmen who maintained regular books. The defendants withheld their own account books, although those books were the best evidence on the truth of the balance. Their own testimony was evasive and did not establish that the accounts had not been checked or that the balance was not correct. The evidence relied upon for the defence was found unreliable and partisan, while the contemporaneous endorsement on the ledger supported an actual adjustment of accounts.

Conclusion: The alleged fraud, coercion, and misrepresentation were not proved, and the signatures were held to have been affixed after adjustment of accounts, in favour of the respondent.

Issue (ii): Whether an unconditional acknowledgment of balance struck in the ledger, in the setting of mutual dealings and stated accounts, furnished a maintainable cause of action for the suit.

Analysis: An unconditional acknowledgment of a struck balance is treated as an implied promise to pay. The suit was not regarded as resting on a bare acknowledgment alone, but on mutual dealings and accounts stated between the parties. The Court rejected the contrary view that such an acknowledgment could only save limitation and could not support a suit, and approved the reasoning that an account balance accepted and signed by the debtor amounts to an accounts-stated basis for recovery.

Conclusion: The suit was maintainable on the basis of the stated accounts and unconditional acknowledgment, in favour of the respondent.

Final Conclusion: The findings below in favour of the plaintiffs were affirmed, and the defendants' challenge to both the factual adjustment of accounts and the legal maintainability of the claim failed.

Ratio Decidendi: Where parties engaged in mutual business dealings sign a balance in their account books after adjustment of accounts, and the debtor withholds his own books, the court may accept the stated balance and draw an adverse inference; an unconditional acknowledgment of such balance can support a suit as an accounts-stated claim.

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