Limitation and proof of debt: private takeover of assets did not revive liability, and account books alone were insufficient.
A claim for recovery of a tea estate balance outstanding from 31-12-1962 was held barred by limitation under Article 19 of the Limitation Act, 1963, because the suit was filed after the three-year period and no payment was made after that date. The defendants' taking over of the estates with assets and liabilities under a family settlement did not amount to acknowledgment under Section 18 of the Limitation Act or a promise to pay a time-barred debt under Section 25(3) of the Contract Act. Entries in books of account and balance-sheets, without proof of the underlying transactions, were insufficient to establish liability under Section 34 of the Evidence Act.
Issues: (i) Whether the claim for recovery of the amount outstanding as on 31-12-1962 was barred by limitation, and whether the defendants' taking over of the tea estates with assets and liabilities amounted to acknowledgment of liability or a promise to pay within the meaning of the relevant provisions; (ii) Whether the plaintiff proved the debt by producing only books of account and balance-sheets without proof of the individual transactions.
Issue (i): Whether the claim for recovery of the amount outstanding as on 31-12-1962 was barred by limitation, and whether the defendants' taking over of the tea estates with assets and liabilities amounted to acknowledgment of liability or a promise to pay within the meaning of the relevant provisions.
Analysis: The suit for recovery of the balance standing against the tea estate on 31-12-1962 was governed by Article 19 of the Limitation Act, 1963, which prescribes three years from the date of the loan. On the facts found, no payment had been made after 31-12-1962, so the claim filed on 1-6-1966 was beyond time. The mere taking over of a going concern with its assets and liabilities in a family settlement did not amount to acknowledgment of liability within Section 18 of the Limitation Act, 1963. It also did not constitute a promise to pay a time-barred debt under Section 25(3) of the Contract Act, as there was no promise made by the defendants to the plaintiff and the compromise was only inter se between family members.
Conclusion: The claim for the balance outstanding as on 31-12-1962 was barred by limitation, and there was no acknowledgment or promise sufficient to extend limitation.
Issue (ii): Whether the plaintiff proved the debt by producing only books of account and balance-sheets without proof of the individual transactions.
Analysis: Section 34 of the Evidence Act makes entries in books of account relevant, but they are not by themselves sufficient to charge a person with liability. The plaintiff produced account books and balance-sheets but failed to prove the individual entries or adduce independent evidence of the transactions, which had been specifically denied. In the absence of proof of the underlying dealings, the entries and balances in the plaintiff's own records were insufficient to establish the debt.
Conclusion: The plaintiff failed to prove the debt in accordance with law.
Final Conclusion: The decree in favour of the plaintiff could not stand, as the principal claim was time-barred and the alleged debt was not proved by admissible and sufficient evidence.
Ratio Decidendi: Mere succession to assets and liabilities under a private compromise does not amount to acknowledgment of a creditor's claim or a promise to pay a time-barred debt, and entries in account books are insufficient by themselves to prove liability without proof of the underlying transactions.
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