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H.K. Dasappa Setty Vs. Vedavathamma and ors. - Court Judgment

LegalCrystal Citation
SubjectContract;Limitation
CourtKarnataka High Court
Decided On
Case NumberSecond Appeal No. 101 of 1969
Judge
Reported inAIR1972Kant283; AIR1972Mys283; (1972)1MysLJ551
ActsHindu Law; Limitation Act, 1908 - Sections 19; Indian Contract Act, 1872 - Sections 25(3); Hindu Succession Act
AppellantH.K. Dasappa Setty
RespondentVedavathamma and ors.
Advocates:M.A. Gopalaswamy Iyengar and ;K.S. Srinivasa Iyer, Advs.
DispositionAppeal allowed
Excerpt:
.....trial court has failed to appreciate this aspect of the matter. the entire material of the prosecution even if un-rebutted, there is no possibility of the petitioners being reasonably to be held guilty of the offence for which they are charged. - as the defendants failed to pay the amount due, the plaintiff filed the suit, praying for a decree against the assets of shama rao in the hands of the defendants. hence, this would clearly amount to an unqualified promise by defendant 2 to pay the amounts due to the plaintiff within sub-section (3) of section 25 of the contract act. strong reliance in placed on a decision of this court in ranganna v. in a case like that, the court held that there was a fresh agreement or contract between the creditor and debtor even though the debt had become..........the manager and has implied authority to acknowledge the liability on behalf of the members of the family. the defendants have not challenged the statement made in the plaint that she was acting as the manager of the family and have not got into the box and denied the same. the trial court has also held that defendant 1 was the de facto manager of the family. the lower appellate court therefore erred in reversing the finding of the trial court. air 1930 mad 991; air 1931 pat 285 are cited in support of the contention that the courts, in dealing with the question of limitation, should as far as possible place a construction favourable to the plaintiff. it is further contended that under the hindu law, a son is under pious obligation to discharge the debt of his father and a time barred.....
Judgment:

M. Santhosh, J.

1. The plaintiff is the appellant before this Court and respond-dents 1 to 3 were defendants 1 to 3 in the trial court. The plaintiff filed a suit on 18-12-1963 to recover a sum of Rupees 1570/- due under three promissory notes executed by late K. R. Shama Rao, husband of defendant 1 and father of defendants 2 and 3. The case of the plaintiff was that Shama Rao, for his family necessity, borrowed different amounts under the three promissory notes, Exhibits P1 to P3. Shama Rao died on 26-5-1959 leaving the defendants as his legal representatives under the managership of the 1st defendant. At various times, defendants 1 and 2 wrote to the plaintiff promising to settle his dues as per Exhibits P4 to P9 and the various acknowledgments made by defendants 1 and 2, save limitation. As the defendants failed to pay the amount due, the plaintiff filed the suit, praying for a decree against the assets of Shama Rao in the hands of the defendants.

2. The defendants stated that they were not aware of Shama Rao borrowing the said amounts under the three promissory notes and put the plaintiff to strict proof of the same. They also dented that they had acknowledged their liability to Pay the suit debts. As the plaintiff was threatening the defendants stating that some amounts were due to him by Shama Rao, the 2nd defendant might have written some letter stating that if any amount was due on verification, he would pay the same under the law. They contended that in any case the debts were barred by time and prated that the suit may be dismissed.

3. The trial Court held that Shama Rao had executed the three suit promissory notes and they were supported by consideration. It also held that the defendants had acknowledged their liability to pay the suit amount and that the suit was in time and decreed the suit of the plaintiff. The lower appellate court allowed the appeal filed by the defendants and held that the suit was not in time. It held that defendant 1, the widow of Shama Rao could not act as the manager of the family and had no power to acknowledge the debts and Exhibit P5, the post card dated 25-6-1959 written by her did not extend the time. It further held that Exhibits P6 to P9 written by defendant 2 were acknowledgments made after the period of limitation had expired and as such the suit wag barred by time. The learned Civil Judge held that Exhibit P4, the application made by defendant 2, dated 25-12-1960 to the Land Mortgage Bank, was too vague and would not amount to an acknowledgment of debt and dismissed the suit of the plaintiff as barred by time. In this second appeal the plaintiff challenges the said decree and judgment passed by the lower appellate court.

4. Sri M. A. Gopalaswamy Iyen-gar, learned counsel appearing on behalf of the appellant, has contended that Shama Rao died in 1959, after the Hindu Succession Act came into force in 1956, and as per the said Act, defendant-1 the widow of Shama Rao, was entitled to succeed to 1/3rd share of his property. Defendant-1 being the eldest member of the family was acting as the manager and in that capacity, acknowledged the liability as per Exhibit P-5, post card dated 25-6-1959 written by her to the plaintiff, Defendant-1, being the eldest member, is deemed to be the manager and has implied authority to acknowledge the liability on behalf of the members of the family. The defendants have not challenged the statement made in the plaint that she was acting as the manager of the family and have not got into the box and denied the same. The trial court has also held that defendant 1 was the de facto manager of the family. The lower appellate court therefore erred in reversing the finding of the trial court. AIR 1930 Mad 991; AIR 1931 Pat 285 are cited in support of the contention that the Courts, in dealing with the question of limitation, should as far as possible place a construction favourable to the plaintiff. It is further contended that under the Hindu Law, a son is under pious obligation to discharge the debt of his father and a time barred debt is a valid consideration. It is argued that as defendant 2 had made an unqualified promise to pay the debts, it would come within Sub-section (3) of Section 25 of the Contract Act, 1964 Mys LJ (Supp) 290; (1906) ILR 33 Cal 1047 (PC) and : [1953]4SCR758 are cited in support of the said contention. It is further argued that Exhibit P4, the application dated 25-12-1960 made by defendant 2 to the Land Mortgage Bank contains an unconditional promise to pay and this saves limitation and the suit filed by the plaintiff was in time. It is finally contended that by Exhibit P5, post card dated 25-6-1959 written by defendant 1, she had acknowledged her liability to pay the debts of Shama Rao and defendant 1's 1/3 share in the family properties would be liable for the debts. The acknowledgment of liability made by defendant 1 would be binding so far as her share of the properties is concerned and the subsequent acknowledgments of liability made by defendant 2 as the manager of the family would keep alive the debts and in any case, a decree should have been passed by the court below against 1/3rd share of defendant 1 in the joint family properties.

5. The defendants, though served, have not appeared before this Court.

6. There is no force in the first contention urged by the learned counsel that defendant 1 was acting as the manager of the family and as such by Exhibit P5 dated 25-6-1959, she could extend the period of limitation. The lower appellate court has negatived the said contention and has pointed out that a Hindu widow was not a coparcener and she cannot legally become the manager of a joint Hindu family. In Commissioner of income-tax v. G. S. Mills. : [1965]57ITR510(SC) , their Lordships of the Supreme Court have pointed out that under the Hindu Law, a widow is not a coparcener and she has no legal qualification to become a manager of a joint Hindu family. There is therefore no force in the said contention.

7. Taking the second contention of Sri Gopalaswamy Iyengar, it may be pointed out that the letters written by defendant 2 to the plaintiff, that is, Exhibits P6 to P9 are not of any use to the plaintiff as these are admittedly written after the period of limitation and as such will not serve as acknowledgment of liability under the three Pronotes. It may be pointed out that as the endorsement made by Shama Rao in Exhibits P2 and P3 are dated 5-7-1956, the period of limitation expired on 5-7-1959. With regard to the other promissory note. Exhibit P1 dated 30-6-1956, the period of limitation expired on 30-6-1959. (1906) ILR 33 Cal 1047 (PC) and : [1953]4SCR758 have no application, as acknowledgments of liability made therein were within the period of three years.

8. It has been contended that Exhibit P4, application dated 25-12-1960, made by defendant 1 to the Land Mortgage Bank, would amount to a promise of payment under Sub-section (3) of Section 25 of the Contract Act. The contention is that in the said application, the 2nd de-fendant, as the manager of the family has acknowledged the debts due to the plaintiff under the three promissory notes and has asked for a loan to repay these amounts and has also stated in the said application that the Bank could pay the amounts due to the creditors directly; hence, this would clearly amount to an unqualified promise by defendant 2 to pay the amounts due to the plaintiff within Sub-section (3) of Section 25 of the Contract Act. Strong reliance in placed on a decision of this Court in Ranganna v. Mallikarjuna Society, 1964 Mys LJ (Supp) 290 in support of the said contention.

9. Sub-section (3) of Section 25 of the Contract Act reads as follows:--

'25. An agreement made Without consideration is void, unless--

(1) X X X X X

(2) x x x x x

(3) it is a promise, made in writing and signed by the person to be charged therewith, or by his agent generally or specially authorised in that behalf, to pay wholly or in part a debt of which the creditor might have enforced payment but for the law for the limitation of suits. In any of these cases, such an agreement is a contract'.

10. Sub-section (3) of Section 25 of the Contract Act is applicable only when there is fresh agreement or contract between creditor and debtor to pay a time-barred debt. In the instant case, it may be Pointed out that Exhibit P4 is not an agreement or contract made between the defendants and the plaintiff. Exhibit P4 is only an application for loan made to a third party Land Mortgage Bank for payment of dues to the plaintiff and other creditors. It may also be pointed out that the manager of a Hindu family has no power to revive a debt barred by law of limitation. At page 283, item 249 of Mulla's Hindu Law (13th edition), it is stated as follows:--

'It is competent to a manager to acknowledge a debt, or to pay interest on a debt, or to make part payment of a debt, so as to extend the period of limitation, but he has no power to pass a promissory note so as to revive a debt barred by the law of limitation'.

11. I am of opinion that the decision of this Court in 1964 Mys LJ (Supp) 290 is of no assistance to the plaintiff. In the said case, after the claim became barred, the debtor wrote to the creditor asking him to furnish information so that he may make arrangements for payment of the sum due. In a case like that, the Court held that there was a fresh agreement or contract between the creditor and debtor even though the debt had become barred by time. As already pointed out, in the instant case, there is no such agreement or contract between the debtor and the creditor and Exhibit P4, the application, was made by defendant 2 as manager to a third party and not to the plaintiff, I am therefore of opinion that Sub-section (3) of Section 25 of the Contract Act is not applicable to the instant case, and Exhibit P4 cannot be construed as an agreement or contract to pay the time-barred debt between the defendants and the plaintiff.

12. I am of the opinion that there is force in the third contention urged by Sri Gopalaswamy Iyengar on behalf of the appellant. In Ex. P5, post card dated 25-6-1959, defendant 1 Venkatamma, widow of Shama Rao, wrote to the plaintiff promising to settle his dues shortly. The lower appellate court has also held that that amounts to an acknowledgment. Though defendant 1 is not the manager of the joint Hindu Family, this acknowledgment of debt by her is binding so far as her share is concerned. Admittedly, she is entitled to l/3rd share in the properties of Shama Rao. She has acknowledged the liability on 25-6-1959, before the debts under the three promissory notes became time-barred. As the debts are kept alive by this acknowledgment so far as her 1/3rd share is concerned, the subsequent acknowledgment of the liability by defendant 2, as the manager of the family as per Exhibit P4 dated 25-12-1960, saves limitation. The suit is filed within three years thereafter, i.e. on 12-12-1963. In Exhibit P4, there is an unqualified promise by defendant 2 as the manager of the family to pay the debts due to the plaintiff. In fact defendant 2 has directed the bank even to pay the amount due to the plaintiff directly. Though Exhibit P4 would not amount to an agreement or contract between the debtor and the creditor coming within Sub-section (3) of Section 25 of the Contract Act, it undoubtedly amounts to an acknowledgment of the debts due to the plaintiff by defendant 2 as the manager of the family. The acknowledgment of the liability made by defendant 1 so far as her share is concerned, is kept alive by the acknowledgment of liability by defendant 2 as the manager of the said joint Hindu family. I am therefore of opinion that the lower appellate court ought to have granted a decree to the plaintiff for the amount due as against the one-third share of defendant 1 out of the assets of the deceased Shama Rao.

13. In the result, for the reasons mentioned above. I allow the appeal and set aside the judgment and decree passed by the lower appellate court. There will be a decree in favour of the plaintiff for the amount claimed in the plaint as against defendant 1. This amount is to be realised from the one-third share of defendant 1 out of the assets of deceased Shama Rao. Defendant 1 will pay the costs of the plaintiff in all the courts. The suit against defendants 2 and 3 is dismissed.


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