2007 (12) TMI 535 - HC - Indian Laws

Enforcing Time-Barred Debts: Legal Clarity on Debt Acknowledgment and Enforcement

The plaintiff filed a suit for recovery of a debt from the defendant. The trial court and lower appellate court ruled in favor of the plaintiff, finding ... - Issues involved:The issues involved in this case are whether the plaintiff advanced a sum of money to the defendant, whether the defendant executed an agreement acknowledging the debt and promising repayment, whether the defendant issued a cheque in favor of the plaintiff, whether the plaintiff is entitled to recovery of the claimed amount, and the relief to be granted.Summary:In this case, the plaintiff filed a suit for recovery of a sum allegedly due from the defendants. The trial court found in favor of the plaintiff, holding that the defendant had borrowed the amount and failed to repay it as agreed. The lower appellate court confirmed this decision. The defendant argued that the suit was barred by limitation as the acknowledgment of debt was made after the expiry of the limitation period. However, the plaintiff relied on Section 25 of the Contract Act, 1872, which allows for the enforcement of a time-barred debt if there is an express promise to pay. The courts found that the agreement between the parties contained such a promise, making the suit valid and not barred by limitation. Therefore, the second appeal was dismissed.This judgment clarifies the legal principles regarding acknowledgment of debt and the enforcement of time-barred debts under Section 25 of the Contract Act, 1872.