1969 (3) TMI 99 - HC - Indian Laws

Payment Acknowledgment Saves Limitation: Appellate Court Rules in Favor

The appellate court set aside the trial court's judgment that dismissed the suit based on limitation grounds. It emphasized the need for acknowledgment of ... - Issues:- Suit dismissed as barred by limitation- Interpretation of Section 19 of the Limitation Act- Whether payment by money order constitutes acknowledgment- Applicability of previous case lawAnalysis:1. The plaintiff appealed the dismissal of his suit by the Subordinate Judge, Erode, on the grounds of limitation. The suit was based on a promissory note and a payment of Rs. 100 made by the respondent through a money order. The lower appellate Court found that the payment was received by the petitioner on 18th July, 1962, and deemed the suit out of time, despite the contention that the money order date should be considered as the payment date.2. Citing the case of Karasinga Rao Garu v. Rangayya AIR1943Mad133, the lower Appellate Court set aside the trial Court's judgment, emphasizing the need for an acknowledgment of the payment to save limitation under Section 19 of the Limitation Act.3. Section 19 of the Limitation Act XXXVI of 1963, a replica of Section 20 of the earlier enactment, was discussed. It requires payment on account of a debt with an acknowledgment, and the receipt of rent or produce of mortgaged land is deemed payment. The provision excludes money payable under a court order from the definition of debt.4. The judgment analyzed the nature of payment through money order, comparing it to payment by cheque. It argued that when a debtor sends money through the post office, it signifies an intention to pay the creditor, similar to payment by cheque. The completion of a money order form by the debtor indicates the purpose of payment to the creditor, thus constituting an acknowledgment and triggering a fresh period of limitation.5. The judgment addressed whether an open payment through a money order coupon could be considered an acknowledgment under Section 19. It concluded that if a debtor sends money towards a specific debt, it is an acknowledgment, supported by a Division Bench decision of the Court and disagreed with a Patna High Court judgment on the matter.6. The Court found that the payment through money order satisfied the requirements of Section 19, constituting both a payment within the limitation period and an acknowledgment of the debt due. It criticized the lower court's reliance on a previous case, Narasinga Rao Garu v. Rangayya AIR1943Mad133, stating it was inapplicable to the present case.7. Consequently, the judgment set aside the lower court's decision, allowing the civil revision petition with costs.