1. This is a plaintiff's application under Section 25, Small Cause Courts Act. The trial Court has dismissed his suit on the ground that it is barred by the law of limitation. He sued on a promissory note, dated 18th June 1930. A few days before the expiration of the three years period, an endorsement was made on the promissory note purporting to be a recital of the payment of Rs. 10, and it was claimed that this saved limitation. The Court however has found that in spite of the endorsement and in spite of the fact that both parties at the time intended the endorsement to save limitation no payment was actually made, and in consequence the claim of the plaintiff-applicant had become time barred when the suit was filed.
2. The decision is attacked on several grounds which I may take in order. In the first place, it is argued that as the endorsement was made on the promissory note and purported to recite a payment of Rs. 10, no evidence should have been admitted to prove that the payment had not been made and the Court in allowing such evidence violated the provisions of Section 91 Evidence Act. The position was that the parties had arranged that the endorsement should be made in order to attract the provisions of Section 20, Limitation Act, and this was a matter that was 'required by law to be reduced to the form of a document,' and no evidence was admissible in proof of such matter except the document itself, namely, the endorsement. There is no doubt to my mind that the matter was one which was required by the provisions of Section 20, Limitation Act, to be reduced to the form of a document; and no evidence could be given in proof of that matter except the document itself. It has certainly been argued by Mr. Kamla Kant Verma for the opposite party that the evidence that was offered was not in proof of the matter, but in disproof of it, namely, to show that no payment had been made. I think however that the term 'in proof of such matter' must carry with it the term 'in disproof of it,' because if evidence were to be admitted on one side, it would have to be admitted on the other; and I am therefore of opinion that Section 91, Evidence Act precludes this oral evidence, and in consequence it must be assumed for the purposes of this case that the payment was made.
3. The next point taken is that, this being the case, part payment of the principal has been proved under Section 20, Limitation Act, and consequently a fresh period of limitation had to be computed from the date of the endorsement. It has been pointed out that in the plaint the plaintiff-applicant claimed that the payment was a part payment not of principal, but of interest. That part of the plaint has been read out to me and it appears that although the plaintiff did not in terms state that the payment was one towards the interest, he did at any rate in the figures which he gave at the foot of the plaint imply that the payment had been appropriated towards interest and not towards the principal. The argument then used for the opposite party is this. Under Sub-section (1), Section 20:
Where interest on a debt is...paid as such by the person liable to pay the debt....
the payment will save limitation, but it must be paid as such by the debtor, that is to say, the debtor who makes the endorsement must specify that the payment is towards interest if it is to he effective payment under this sub-section.
4. It is clear that there was no such specification in this case and the applicant's case is that the alleged payment was made towards the principal, so that there was no necessity for any specification by the debtor. But Mr. Varma's argument is that the payment was not one towards principal, because the creditor, i.e., the plaintiff-applicant, did appropriate it towards interest, and the consequence is that Section 20 Limitation Act, will not apply at all. There is some support for this argument in the case of Ramaprasad v. Binaek Shukul 1933 All 453 which has been followed more recently by a Single Judge of this Court. But I think it is possible to distinguish the present case, because both parties agreed at the time of the endorsement that it should be made for the purpose of saving limitation, and therefore I think there can be no doubt that at that time the intention was to appropriate the payment (which we must assume to have been made) towards the principal and not towards interest. It was held in a Division Bench of this Court in the case of M.B. Singh & Co. v. Sircar & Co. 1930 All 392, that where there has been no specification of such a payment to show whether it is to be appropriated towards principal or interest it must be held to have been intended that the payment was forwards principal. There might be some difficulty in applying this principle to every case, because of the manner in which the Act is worded, and because of the later decision of a Bench of this Court to which I have already referred. In the circumstances of the present case however I think it is clear that the payment was intended to be made towards principal, and no matter whether the plaintiff afterwards changed his mind and chose to regard the payment as one towards interest as he apparently did at the time of drafting the plaint, it was nevertheless on 29th May 1933 effective to start a fresh period of limitation.
5. This being so, it is unnecessary for me to consider the further contention of the applicant that the endorsement amounts to an acknowledgment under Section 19, Limitation Act. I allow the application with costs in this Court, set aside the decree order of the trial. Court and direct that the suit be decreed. As the question relating to the admission of the oral evidence was not raised in the trial Court, I pass no order as to costs in that Court.