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Chittar Mal and anr. Vs. Behari Lal and ors. - Court Judgment

LegalCrystal Citation
SubjectLimitation
CourtAllahabad
Decided On
Judge
Reported in4Ind.Cas.261
AppellantChittar Mal and anr.
RespondentBehari Lal and ors.
Excerpt:
limitation act (xv 0f 1877), schedule ii, article 85 - open, current and mutual account--account stated--limitation. - .....continued between them it was a current account. we have then only to consider, whether it was a mutual account. it was held in ganesh v. gyanu 22 b. 606 that the dealings to be mutual must be trans actions on each side creating independent obligations on the other, and not merely creating obligations on one side, the other being merely discharges of these obligations. the test of a shifting balance, sometimes in favour of one party and sometimes in favour of the other, though valuable as an index of the nature of the dealings, is not by itself always decisive'. the same view was held by the calcutta high court in ram pershad v. harbans singh 6 c.l.j. 158. in bhawan singh v. tika ram 16a.w.n. 186 this court held that article 85 of schedule ii of act xv of 1877 applies to a case where.....
Judgment:

1. The suit out of which this appeal has arisen was brought by the plaintiffs-appellants to recover from the defendants-respondents Rs. 1,235-15-6 as the balance of an account existing between the parties. The allegations of the plaintiffs are that an account of dealings between them and the defendants was opened on Maghsar Sudi 9th, Sambat 1956, corresponding to the 11th of December, 1899, that on the 13th of August, 1904 the account was stated by the parties and a balance of Rs. 2,394-9-3 was struck in favour of the plaintiffs, that subsequently the plaintiffs realised Rs. 1,479-10-6 on account of the price of wheat sold by them for the defendants, and the defendants were debited with the sum of Rs. 312-14-0 on account of interest and other charges and that the amount claimed was due by them. The defendants asserted that they had no dealings with the plaintiffs and denied that any account was stated or that any sum was due by them. The Court of first instance found in favour of the defendants and dismissed the suit. Upon appeal by the plaintiffs the lower appellate Court found that the defendants had dealings with the plaintiffs but that they did not acknowledge their liability by stating accounts in August, 1904, as alleged by the plaintiffs. It accordingly affirmed the decree of the Court of first instance on the ground that the claim was time-barred. The plaintiffs have preferred this appeal and it is contended on their behalf that having regard to the nature of the dealings between the parties and of the accounts, the suit ought to have been treated as one for the balance due on a mutual open and current account where there had been reciprocal demands between the parties and that under Article 85, Schedule II of Act XV of 1877, the claim was not time-barred. If what is contended for on behalf of the plaintiffs is correct, the account between the parties would be a mutual, open and current account. Upon the findings of the Court below that no account was stated by the parties and no balance was struck the account remained open, and if dealings continued between them it was a current account. We have then only to consider, whether it was a mutual account. It was held in Ganesh v. Gyanu 22 B. 606 that the dealings to be mutual must be trans actions on each side creating independent obligations on the other, and not merely creating obligations on one side, the other being merely discharges of these obligations. The test of a shifting balance, sometimes in favour of one party and sometimes in favour of the other, though valuable as an index of the nature of the dealings, is not by itself always decisive'. The same view was held by the Calcutta High Court in Ram Pershad v. Harbans Singh 6 C.L.J. 158. In Bhawan Singh v. Tika Ram 16A.W.N. 186 this Court held that Article 85 of Schedule II of Act XV of 1877 applies to a case where the course of business has been of such a nature as to give rise to reciprocal demands between the parties. If, therefore, in this case the dealings between the parties were such as to create independent obligations in favour of one party against the other, the account between them was a mutual account, and in that case limitation would run, under Article 85, from the close of the year in which the last item admitted or proved was entered in the account. It is true that in the plaint the plaintiffs put forward the case of an account stated; but having regard to the allegation in the plaint that there was an account between the parties and to the further fact that the account produced by the plaintiffs might be considered to be an open, current and mutual account the Court ought to have determined whether the account was of that description and whether there was a balance due to the plaintiffs from the defendants. This was not done by the lower appellate Court although it found that there were dealings between the parties. We think that the case should go back to the Court of first instance for the purpose of determining whether there was a mutual, open and current account between the parties of the nature pointed out above, whether the claim for the balance of, such an account was or was not time-barred under Article 85 of the Second Schedule to Act XV of 1877, and whether any and what balance was due to the plaintiffs. We accordingly allow, the appeal, discharge the decrees of the Courts below and remand the case to the Court of first instance under order 41 Rule 23 of the Code of Civil Procedure with directions to re-admit it under its original number in the register and dispose of it on the merits, having regard to the observations made above. The parties respectively will abide their own costs of this appeal. As to other costs hitherto incurred, the Court in finally deciding the suit will pass proper orders.


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