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M. Ramiah Pillai Vs. P.A. Sankaranarayana Iyer and ors. - Court Judgment

LegalCrystal Citation
SubjectLimitation
CourtKerala High Court
Decided On
Case NumberA.S. No. 226 of 1955 (T)
Judge
Reported inAIR1958Ker246
ActsLimitation Act, 1908 - Schedule - Articles 54 and 66; Contract Act, 1872 - Sections 2
AppellantM. Ramiah Pillai
RespondentP.A. Sankaranarayana Iyer and ors.
Appellant Advocate R. Narayana Pillai, Adv.
Respondent Advocate N. Krishnaswami Iyengar, Adv. for Respondent 3
DispositionAppeal dismissed
Cases Referred(A) and Gaya Prasad v. Sher Ali
Excerpt:
.....specified by implication on account of the terms of the bond, the requirement of the first column in article 66, namely, where a day is specified for payment' would be fulfilled, and so in the case of suits on simple bonds which provide a specified period within which payment will be made, the article which would be applicable is article 66 and the starting point of limitation would be the last day of the period within which the payment has to be made which must be deemed to be the day specified for payment......this means that the last day of the period is impliedly specified by the agreement as the day for payment. article 66 of the indian limitation act (article 54 of the tra-vancore limitation act) does not say that the day for payment should be specified expressly in the bond.when the day is clearly specified by implication on account of the terms of the bond, the requirement of the first column in article 66, namely, 'where a day is specified for payment' would be fulfilled, and so in the case of suits on simple bonds which provide a specified period within which payment will be made, the article which would be applicable is article 66 and the starting point of limitation would be the last day of the period within which the payment has to be made which must be deemed to be the day.....
Judgment:

Kumara Pillai, J.

1. This appeal arises out of a suit for money. Defendants 1 and 2 were the Directors of a Bank known as the Trivandrum Bank Ltd., which is now in liquidation. Plaintiffs 1 to 3, who are father and sons, had deposited various amounts in the said Bank and a sum of Rs. 4500 was due to them from the Bank in November 1939 on account of deposits which had matured and become repayable in August and September 1939. The plaintiffs' case is that these deposits were made by them on the personal request and assurances of safety made by defendants 1 and 2, the Directors of the Bank, and that, since there was a Bank crisis in November 1939, at the request of defendants 1 and 2 they allowed these deposits to remain in the Bank in order to help it and inspire confidence among its depositors on a written agreement, Ext. A, given by defendants 1 and 2 on 29-11-1939 undertaking to return the amount with interest at 6 per cent., per year within twelve months.

The personal liability undertaken by defendants 1 and 2 was in addition to the Bank's responsibility. The suit was brought on 4-11-1946 on Ext. A for the recovery of Rs. 4500 and interest from defendants 1 and 2, and to save the suit from limitation plaintiffs relied upon a sign-ed acknowledgment alleged to have been made by defendants 1 and 2 on 27-11-1943 at the foot of Ext. A itself. The acknowledgment is Ext. A-1.

2. Both defendants 1 and 2 contested the suit. Defendant 1 contended inter alia that the agreement, Ext. A, was not supported by consideration and could not therefore be enforced. Defendant 2 denied that he had signed the acknowledgment, Ext. A-1, and contended that the suit was barred by limitation and that Ext. A was executed only by way of a collateral security and that it had been discharged by the plaintiff being given and accepting assignments of certain decrees obtained by the Bank. The lower court repelled these contentions and gave the plaintiffs a decree in terms of the plaint; and this appeal is filed by defendant 2 against thaS decree. Defendant 1 has not filed any appeal and has acquiesced in the lower court's decree.

3. We shall first consider the question of the genuineness of Ext. A-l, the acknowledgment. In paragraph 6 of his written statement defendant 2 stated that no acknowledgment was made by him, but when he was examined as Dw. 2 all that he was prepared to say even after seeing Ext. A-l was that he could not recollect having signed it. Even this he said in reply to a leading question put by his counsel, 'do you recollect to have acknowledged Ext. A like this.' His reply to that question was 'no'.

He admitted that the signature in Ext. A-l purporting to be his resembled his signature. Plaintiff 3 and defendant 1 who have been examined as Pw. 1 and Dw. 1 respectively both answer that defendant 2 also has signed Ext. A-l and that he signed it in their presence. Exts. A, E, P and J admittedly contain the signatures of defendant 2, and a comparison of Ext. A-l with them would show that the signature in A-l purporting to be that of defendant 2 must really be his signature. From the evidence of Pw. 1 and Dw. 1 and in view of the circumstances mentioned above we are satisfied that defendant 2 has really signed Ext. A-l and that the lower court was right in holding the acknowledgment to be genuine.

4. It was contended by appellant's counsel that even if Ext. A-l was genuine, it would not save the suit from limitation as that acknowledgment itself was made after the original cause of action on Ext. A had become barred by limitation. The undertaking in Ext. A was that defendants 1 and 2 would pay the amount to the plaintiffs within twelve months from the date of that document. It is urged on behalf of the appellant that this undertaking does not specify any date for payment of the amount and that therefore the article which applies to a suit brought on Ext. A is Article 65 of the Travan-core Limitation Act, corresponding to Article 67 of the Indian Limitation Act, which provides for a suit on a single bond, where no day is specified for payment, a period of three years from, the date of executing the bond.

As Ext. A was executed on 29-11-1939 learned counsel for the appellant contended that the cause of action on it became barred by limits tion on 29-11-1942 under Art. 55 of the Travan-core Limitation Act (Article 67 of the Indian Limitation Act) and that the acknowledgment made on 27-11-1943, after the original cause of action had become barred by limitation was of no avail. In reply to this contention the plaintiffs' learned counsel contended that the Article which would apply to Ext. A was Article 54 of the Travancore Limitation Act corresponding to Art. 66 of the Indian Limitation Act which provides for a suit on a simple bond, where a day is specified for payment, a period of three years from the day so specified.

Although there is no express mention of any date in Ext. A for payment of the amount, in view of the undertaking that the amount was to be paid within twelve months of its date plaintiff was entitled to get payment of the full amount at the expiry of that period and had no right to demand payment before the expiry of the said period. This means that the last day of the period is impliedly specified by the agreement as the day for payment. Article 66 of the Indian Limitation Act (Article 54 of the Tra-vancore Limitation Act) does not say that the day for payment should be specified expressly in the bond.

When the day is clearly specified by implication on account of the terms of the bond, the requirement of the first column in Article 66, namely, 'where a day is specified for payment' would be fulfilled, and so in the case of suits on simple bonds which provide a specified period within which payment will be made, the Article which would be applicable is Article 66 and the starting point of limitation would be the last day Of the period within which the payment has to be made which must be deemed to be the day specified for payment.

In this view which is supported by the decisions in Narain Babu v. Gouri Prasad Bias, ILR 5 Cal 21 (A) and Gaya Prasad v. Sher Ali, 39 Ind Gas 574: (AIR 1917 All 402 (1) ) (B); the original cause of action on Ext. a would have become barred by limitation only on 29-11-1943, and the acknowledgment, Ext. A-1, made on 27-11-1943 would be a valid acknowledgment and save the present suit from limitation.

5. Another contention advanced by the appellant's counsel in this court was that Ext. A is invalid for the reason that it is not supported by consideration. No such contention was raised by defendant 2 In the lower court, and it was only defendant 1 who contended in that court that Ext. A is not supported by consideration. In Ext. A itself it is specifically stated that on the personal request and assurances of the safety made by defendants 1 and 2 the plaintiffs had made the deposits in the Bank and that although their deposits had matured and become repayable in August and September 1939 they had allowed the deposits to remain in the Bank on the undertaking given by defendants 1 and 2 in order to help the Bank to tide over the crisis and inspire confidence among its creditors.

Pw. 1 also has given evidence to the effect that on account of the undertaking given by the defendants in Ext. A plaintiffs allowed the deposits to remain in the Bank even after they matured without pressing for immediate repayment. This forbearance on the plaintiffs' part to withdraw the amount or press for its repayment which they would assuredly have done but for the undertaking in Ext. A is sufficient consideration for the agreement within the meaning of that term as defined in Section 2(d) of the Indian Contract Act.

6. The contention that the defendants have been discharged from the obligation under Ext. A is also without any substance. No decrees have actually been assigned to the plaintiffs. The Bank had only constituted the plaintiffs by Ext. E as its agent to execute certain decrees with a view to make payments to them from the amounts realised in execution, but the arrangement under Ext, E was not carried out as the Bank went into liquidation soon after its execution. Further, Ext. E does not absolve the defendants from the liability undertaken by them under Ext. A.

7. In the result the appeal fails, and it is accordingly dismissed with costs the decree of the lower court Is confirmed.


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