TaxTMI 
TaxTMI 
1994 (6) TMI 221
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....and (1906) 33 Ind App 165. (iii) Sitayya v. Rangareddi (1887) ILR 10 Mad 259). (iv) Jainarain v. Governor-General of India (AIR 1951 Cal. 462). (v) Krishna Kurppu v. Raman Pillai 45 TLR 200. that are specifically referred to in the earlier decision of this Court -- 1963 Ker LT 215. We will have to consider the scope and application of Section 18 of the Limitation Act, obviously in relation to the facts of the present appeal. 3. The unsuccessful plaintiff has approached this Court in appeal, broadly, on the following averments : (i) The appellant/plaintiff was carrying on business on giving on hire, steel folding chairs, steel folding tables etc. One Shri K. S. Menon, the husband of the first defendant and the father of the second defendant was the Proprietor of a circus -- "Bharat Circus", during all over the country attracting large crowds at the various camps. (ii) During the period from September 1, 1976, when the circus was camping at the Municipal Stadium, Nagercoil, plaintiff was approached by K. S. Menon and his Manager with a request for the supply of 1000 steel chairs for hire, during the camp of the circus at Nagercoil. This was on a long term basis ....
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.... the time of the camp of the circus at Perinthalmanna. During this time also payments were not regular. The irregularity commenced from the camp at Coimbatore. The statement of accounts as given in the plaint is as follows : a)17-10-1979 Letter by K. P. Janardhanan Nambiar, Cashier in the Circus Company. b) 6-1-1980 -Letter by the Manager, Bharat Circus, accompanied by a Demand Draft for ₹ 1000/- (one thousand) only. c) 21-6-1980 Letter by the Manager, Bharat Circus, sent from Nellore. Andhra Pradesh. d) 4-11-1980 : Letter by K. P. Janardhanan Nambiar, Cashier, on behalf of the Manager, sent from Tumkur, forwarding a Demand Draft for ₹ 15000/-only. e) 20-4-1981 : Letter by K. P. Janardhanan Nambiar from Trichur sent on behalf of the Manager, Bharat Circus forwarding a Demand Draft for ₹ 1000/- only. vi) At the camp at Palaycottah there were disputes and the circus stopped functioning on and there from October 24, 1982. On the basis of the accounts the suit was filed for an amount of ₹ 1,00,520/- with future interest at the rate of 6% per annum from May 21, 1983 till recovery, from the assets of K. S. Menon in the hands of the defendants. 4....
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....basis of their own knowledge and consequent expectation of bringing the necessary material on the record through evidence. 9. The plaintiff examined himself and proved the statement of accounts. On the contrary, the witness who is examined on" behalf of the defendants is a mere holder of power of attorney (Balakrishna Menon) who has given evidence on the basis of his knowledge. In the evidence the said witness does not depose anything about the nature of the accounts, as regards correctness or exaggerations in regard thereto. 10. The learned Judge (Second Additional Sub Judge, Trivandrum) by the impunged judgment dismissed the suit mainly or rather wholly, on the ground of limitation. The learned Judge has recorded as finding that no amount is claimed after May, 1979, in view of the admission that the entire hire charges upto May 9, 1979 were fully paid and the plaintiff claims hire charges only form May 13, 1979 upto Nov. 19, 1982 on the basis of the statement of accounts showing that 1700 chairs were returned by the second defendant to the plaintiff. The learned Judge on issue No. 6 has held that the claim of the plaintiff is barred by limitation. It is already stated that....
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....ents, of delivery, performance or enjoyment has not been refused or is contested by a claim to set off or addressed to some person who is not entitled to the property or right. In other words the requirement is not the specification of the exact nature of the amount, property or right; or specifically that a claim of set off is not addressed to a wrong person. The acknowledgement specifying the require merits of Section 18 creates a fresh period of limitation. 15. The underlying doctrine of acknowledgement is based on a legitimate presumption of payment, by a promise to pay. In this context even an un-conditional acknowledgment of debt or payment is considered on the basis of natural inference from the absence of not saying to the contrary. It presumes that the person making acknowledgement had some interest binding him, because had he no interest in an acknowledgement, there would not be any necessity of acceptance with reference to any part of the transaction. It must be made at the time of the existing liability by the party or his authorised person. It must be expressed or implied and in writing, not necessarily of the person but it can also be by an agent duly authorised in t....
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.... In fact, reading of the judgement shows that the question as to what constitutes an acknowledgement was not taken up for consideration and the question arose on an entirely different set off facts. An acknowledgement, as stated above relates to the acceptance of jural relationship, transaction and liability arising therefrom. It is in the light of the above observations, the reference court found it difficult to accept the proposition, 18. We must record our strong disapproval of the approach of the learned Judge who has approached the question with a blind reliance on the above decision. The learned Judge, we record, has not approached the question with reference to the facts on the basis of which acknowledgements have been pressed into service, on the basis of a set of correspondence on record. Apart therefrom the learned Judge committed grave error in rushing to throw out the plaintiff on this part totally ignoring that the defendants have not pleaded their case on merits except and by way of bald denials as stated above. 19. We take up for consideration the question of the truth and exact meaning of the word acknowledgement on the basis of decided cases cited before us. 20.....
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....view that the letter admitted receipt of the amount by the State from the plaintiff and then amount was received as duty on goods which were non dutiable. Relying on the decision cited above the court held that it amounted to an acknowledgement. 22. The sum and substance of these decisions spell out that as to what amounts to an acknowledgement would depend on the factual position spelled out by the case at hand. Illustratively, if there is a dispute as regards the amount, if there is a demand for verification of the accounts, if there is a contention that the accounts are exaggerated if the relationship of a debtor and a creditor is admitted, and if even in the written statement this position is acknowledged, the situation would amount to an acknowledgement enough to extend the period of limitation, freshly under the provisions of Section 18 of the Limitation Act. The relevant case law that is considered above would not but spell out in every situation that acknowledgement would be a question of fact in every matter. 23. As stated above, paragraph 15 of the plaint clearly shows various dates relating to the correspondence. Equally well in the evidence also the correspondence is ....
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....ing of the next day Ext. A2 is the receipt for ₹ 115/- relating to 1200 chairs by way of an advance. Ext. A3 is a note to the Check Post Officer -- Amaravila for permitting and allowing the chairs for the circus. Ext. A4 is a receipt for 300 chairs, received on March 26, 1977. These documents beyond doubt relate to the transaction under the agreement (Ext. A5). (ii) The second group is a letter (Ext. A6) dated June 14, 1977. This is by K.S. Mohan. In the said letter a difficulty is pleaded that the collection is poor and the circus is not in need of so many chairs and a consequent assurance of taking more chairs at Madras opening. Along with it ₹ 700/- is sent being the balance of Tirpur camp, and a receipt is demanded. (iii) This group relates to the year 1979 and consist of letters Ext. A7, A8, A9 and A10 --dated 15-2-1979, 21-2-1979, 2-5-1979 and 25-6-1979. It is partinent to note that the demand in the suit is from October 17, 1979. Ext. A7 is a telegram to send chairs by lorry urgently, this is by K.S. Mohan. Ext. A8 acknowledges 1000 chairs sent and remittance of ₹ 600/-as rent, coupled with hire charges at Ernakulam camp are being sent through one Sreek....
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....dded to this there is a letter at Ext. A19 dated Nov. 24, 1980 recording sending of ₹ 1,500/- by Demand Draft. Additionaly by letter Ext. A20 dated January 6, 1980 there is payment of ₹ 1,000/- by a draft with a pleading that payments are delayed due to various difficulties with an intimation that when the circus moves to Kerala as much amount as possible would be tendered. This correspondence naturally extends the period of limitation neately upto the year 1980. v) For the year 1981 also there is correspondence: A/23, A/24, A/25, A/26, A/27 and A/28. If this is seen, it would show that even during the year 1981 the claim was acknowledged. In fact the suit having been filed on March 21, 1983, for the purpose of limitation and acknowledgement, these letters need not be referred. However, it is necessary to show that continuously parties were in correspondence with regard to the issue, balance of payments and dues for all these years. A/23 is dated May 25, 1981 from the Manager of Circus and reference of 250 chairs despatched acknowledging balance of 770 chairs. A/24 is the letter dated June 9, 1981 requesting sending of new 1500 chairs so as to reach before the Coimbat....
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....dants are in possession of the accounts relating to the transaction they are bound to produce it; otherwise adverse inference can be drawn. The learned Judge has ignored that defendants' witness has categorically deposed that there is no dispute about the accounts produced, proved and tendered by the plaintiff. The accounts are in sufficient and great details and are not effectively challenged in the cross-examination. In the face of detailed accounts and in the teeth of failure to discharge the burden on the defendants the accounts would have to be accepted as true and correct. 31. The observation of the learned Judge that in the absence of evidence that the accounts were in possession of the defendants at the time of filing of the suit would have to be held as erroneous, in view of the clear admission of the witness that from 1966 up to 1982 the witness himself was the Accountant of the Bharat Circus. 32. Apart therefrom, even if independently the evidence on record is taken into consideration in the light of pleadings of bare and flat denials of the defendants, it will have to be recorded that even if much was expected from the defendants to discharge the burden of proof u....