Acknowledgment of liability restarts limitation, while documentary records sustained the arbitral rejection of the remaining claim.

A written acknowledgment of liability within the limitation period can revive the claim and start a fresh period of limitation; the tribunal's refusal of the Rs. 5 lakh journal-entry claim was therefore set aside. On the purchase and sale transactions claim of Rs. 82.04 lakhs, the arbitral finding was sustained because contemporaneous contract notes and acknowledgments supported the respondent's case, and the petitioner failed to dislodge that documentary evidence or establish any defect in authority or receipt. Relief was thus confined to the journal-entry claim, while the remaining award was upheld.

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Issues: (i) Whether the claim to the extent of the journal entry of Rs. 5 lakhs was barred by limitation or saved by acknowledgment of liability, and (ii) whether the rejection of the claim relating to purchase and sale transactions of Rs. 82.04 lakhs called for interference on merits.

Issue (i): Whether the claim to the extent of the journal entry of Rs. 5 lakhs was barred by limitation or saved by acknowledgment of liability.

Analysis: The limitation objection could not stand where the consolidated account reflected reversals of entries and the petitioner's objection letter, read with the subsequent reversal on 11 August 2009, amounted to an acknowledgment of liability in writing. The arbitral tribunal failed to apply the legal effect of such acknowledgment under the Limitation Act. In light of the fresh period of limitation, the claim lodged on 10 February 2010 was within time.

Conclusion: The claim for Rs. 5 lakhs was not barred by limitation and the rejection of that part of the claim was liable to be set aside.

Issue (ii): Whether the rejection of the claim relating to purchase and sale transactions of Rs. 82.04 lakhs called for interference on merits.

Analysis: The arbitral tribunal relied on the contract notes and acknowledgments showing that the transactions were carried out on the petitioner's oral instructions and that the contract notes were duly received. The petitioner did not establish that the acknowledgments were not his or were not received on his behalf. The Court also found that the petitioner's challenge to the alleged authority letter and signature did not dislodge the respondent's documentary evidence, and the comparison of signatures did not assist the petitioner in upsetting the tribunal's finding.

Conclusion: The rejection of the claim of Rs. 82.04 lakhs on merits was upheld.

Final Conclusion: Relief was granted only to the limited extent of the Rs. 5 lakhs journal entry claim, while the remainder of the award was sustained.

Ratio Decidendi: A written acknowledgment of liability within the statutory period gives rise to a fresh period of limitation, and arbitral findings based on contemporaneous contractual records will not be disturbed absent a cogent factual challenge.

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