Acknowledgement of liability under Limitation Act established by letters admitting receipt of money and subsisting transactional relationship.

Letters from the defendant's records were held proved and admissible because they formed part of a continuous correspondence, came from proper custody, were tendered without objection, and were supported by oral evidence of receipt. The Court further held that an acknowledgement under Section 18 of the Limitation Act does not require an express promise to pay; it is enough that the writing shows a present subsisting liability and a jural relationship. The letters admitted receipt of money and described it as an advance or deposit, which amounted in law to an acknowledgement of liability and extended limitation. The suit was therefore within time and maintainable.

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Issues: (i) Whether the two letters relied upon by the plaintiff were proved and admissible in evidence; (ii) Whether those letters constituted an acknowledgement of liability within the meaning of Section 18 of the Limitation Act, 1963 so as to extend limitation and save the suit from being time-barred.

Issue (i): Whether the two letters relied upon by the plaintiff were proved and admissible in evidence.

Analysis: The letters formed part of the official record of the plaintiff and were part of a continuous chain of correspondence between the parties. They were tendered without objection, emanated from proper custody, and were supported by oral evidence that they had been received from the Federation. In these circumstances, the contents of the documents could be read in evidence, and the absence of cross-examination or rebuttal strengthened their evidentiary value.

Conclusion: The letters were proved and admissible in evidence.

Issue (ii): Whether those letters constituted an acknowledgement of liability within the meaning of Section 18 of the Limitation Act, 1963 so as to extend limitation and save the suit from being time-barred.

Analysis: An acknowledgement under Section 18 need not contain an express promise to pay, but it must show a present subsisting liability and a jural relationship between the parties. The letters admitted receipt of Rs. 2 crores and referred to the amount as advance or deposit against the transaction. Even though liability was disputed on the footing that no amount would ultimately be found due, the admission of receipt and the existing relationship of debtor and creditor were sufficient to amount to an acknowledgement in law.

Conclusion: The letters constituted a valid acknowledgement of liability and extended the period of limitation, so the suit was within time.

Final Conclusion: The suit was held to be maintainable in time, and the plaintiff was entitled to decree for the amount found due by the trial court, with costs and interest as directed.

Ratio Decidendi: A written admission of receipt of money from the claimant, coupled with recognition of the subsisting transactional relationship, amounts to acknowledgement of liability under Section 18 of the Limitation Act, 1963 even if the debtor disputes that any amount will ultimately be payable.

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