1. This is a plaintiff's appeal and has arisen out of a suit for recovery of Rs. 1,070-3-6 made up of Rs. 595-13-9 principal and Rupees 474-7-6 interest together with another sum of 0-2-3 which need not be detailed, on the allegation that the defendant purchased on 25th June 1914 from the plaintiff ornaments and cloth of the aggregate value of Rs. 1,003-9-6. and that he paid Rs. 210-10-0 on that date promising to pay balance within a month. It is also alleged that the defendant agreed to pay interest in case of non-payment of the aforesaid sum within the stipulated time.
2. The plaintiff's shop is at Badhohi in the Benares State. The transaction to which the suit relates had also taken place in Badhohi. The plaintiff instituted a suit in the Benares Court and obtained a decree on 27th July 1916 for the sum then due. Certain payments were made from time to time by the defendant and an application for execution of decree was made some time in 1926 and a sum of Rs. 100 was paid on 29th August 1926. This application was made in the Munsif's Court of Mirapur. The last application for execution was made in the same Court in 1928. It was contested on the ground that for certain reasons, which it is not necessary to mention, the decree obtained by the plaintiff from the Court of the Benares State was void. Accordingly execution of decree for the balance due was refused. The plaintiff then brought the suit which has given rise to this appeal on 15th October 1929 in the Court of the Munsif of Mirzapur. The claim is based on the original cause of action, namely, the purchase of ornaments and cloth on 25th June 1914. As defendant resides in the Mirzapur district, the plaintiff was entitled to institute a suit in the Mirzapur Court for recovery of what was due to him in respect of the transaction entered into in the Benares State. No question as to jurisdiction was raised in either of the Courts below or before us.
3. The suit was resisted principally on the ground that it is barred by limitation. The plaintiff attempted to escape the bar of limitation by relying upon a number of payments made by the defendant which, according to him, saved limitation under Sections 19 and 20, Limitation Act. Another ground on which the defendant succeeded in defeating the plaintiff's claim in the Courts below is that the payments made towards the satisfaction of the decree obtained by the plaintiff from the Benares Court could not be considered to be payment towards the original debt. We do not consider it necessary to express any opinion on the correctness or otherwise of the view taken by the Courts below on this point, as in our opinion the plaintiff's suit must fail on the ground of limitation. The defendant made a number of payments after the date of the transaction, the first of which was made within 3 years from that date. -'.'Each subsequent payment is within 3 years from the date of the next preceding payment. It follows that if every-one of the payments fulfils the requirements of Section 19 or Section 20, Limitation Act, the plaintiff may be held entitled to a decree. But to arrive at that finding every payment has to be examined in the light of the provisions of Sections 19 and 20, Limitation Act.
4. The first payment of Rs. 40 is said to have been made on 7th ''February 1918. There is no evidence that the defendant paid that sum towards interest. The plaintiff's case is that interest was payable and was overdue. In the account annexed to the plaint the plaintiff has charged interest and has appropriated each payment towards inters. At any rate, the sum of Rs. 40 paid on 7th February 1918, was appropriated towards interest. It is argued by the learned Counsel for the appellant that if the defendant did not pay Rs. 40 towards interest, he must be taken to have paid it towards principal and as the fact of payment appears in his hand-writing, Section 20 is fully applicable. In our opinion this argument is based on a fallacy and proceeds on the assumption that where interest is not paid as such, that is, the debtor does not clearly mention that the payment made by him was to be appropriated towards interest, it should be considered to have been paid by him towards principal. To our mind this is a wholly erroneous assumption. A debtor may pay a certain amount in part satisfaction of what is due from him without caring to specify that the sum is to be appropriated towards interest or principal. The payment will not be considered to be the payment of interest as such and will not save limitation on that footing. The creditor may however appropriate such payment towards* interest, as he is entitled to do under Section 61, Contract Act. The position then is that though interest was not paid as such,, payment made by the debtor was lawfully appropriated towards interest. It cannot be considered to be payment in part satisfaction of the principal. Therefore if the fact of the payment appears in writing limitation cannot be saved on the supposition that a part of the principal was paid and the fact of payment appears in the hand-writing of the debtor. As already stated payment of Rs. 40 made on 7th February 1918 was not made towards interest. The creditor did appropriate it in satisfaction of the interest. The payment was not payment of interest as such and cannot save limitation and though it is in writing it cannot be assumed to be payment of I principal so as to save limitation under Section 20.
5. It was also contended that each payment amounted to an acknowledgment of liability within the meaning of Section 19. It is said that payments were noted by the defendant on each occasion on a certain copybook which the plaintiff's peon used to take round to the debtors. This copybook was produced in the lower Court; it has not come up with the record of the case. We declined to adjourn the case as the entries on that copybook were not relied on in either of the two Courts below as containing acknowledgments under Section 19, Limitation Act. The fact of payment which is not disputed was also relied on as acknowledgment under Section 19. Where a debtor pays a certain sum of money to his creditor, there may be an implied acknowledgment of the liability to the extent of the amount paid. It cannot however be said that the remaining liability shown by evidence aliunde should be deemed to have also been acknowledged. In this view the payment of Rs. 40 on 7th February 1918 cannot amount to an acknowledgment under S, 19, Limitation Act. As limitation is not saved by the first item, the debt became time-barred by the time the next payment was made on 27th April 1919 and subsequent payments can be of no avail, even if they fulfil the requirements of Section 20 or amount to acknowledgments under Section 19. Accordingly we hold that the plaintiffs' claim was barred by limitation. For the reasons stated above, this appeal fails and is dismissed with costs.