1. The only question in this second appeal is whether the suit is barred by limitation. The plaintiffs are the sons or Venkayya Garu and sue the defendants who are the members of the Committee called Sri Kannika Parameswari Visamsetti Venkataratnam Hindu High School Committee for a certain sum alleged to be due to the plaintiffs. The Subordinate Judge gave a decree in favour of the plaintiffs. On appeal the District Judge at Masulipatam dismissed the suit on the ground that it was barred by limitation.
2. The defendants who are the members of the Sri Kannika Parameswari Visamsetti Venkataratnam Hindu High School Committee took over the management of the Hindu High School at Bezwada with all its assets and liabilities from another committee called Sri Kannika Parameswari Hindu High School Committee in November, 1915. Both the committees were registered under the Registration of Societies Act, 1860. Venkayya advanced considerable sums of money for the upkeep of the school and for certain buildings connected with the school and the committee of the school authorised two of its members to execute a promissory note in his favour for the amount due. Ex. E was executed on 18th November, 1913. The suit was filed on 14th November, 1916. The promissory note was found to be invalid as it was made payable to bearer. The plaintiffs rely upon Section 19 of the Limitation Act and wish to treat Ex. E as an acknowledgment in writing and signed by the agent of the debtors duly authorised in their behalf. The contention of Mr. Varadachariar for the respondents is that the executants of Ex. E were not authorised to make an acknowledgment and therefore it cannot be treated as an acknowledgment under Section 19 of the Limitation Act. Ex. D-3 which is dated 17th November, 1917, he contends, is not an acknowledgment for it only authorises two members of the committee to execute a promissory note. D-3 is the resolution of the committee authorising the President and the Secretary and a member of the committee (Gopala Rao) to execute a promissory note for the sum of Rs. 3,500 to Venkayya Pantulu. D-3 is not an acknowledgment of liability. in pursuance of the authority Ex. E was executed on 18th November, 1913. Ex. E therefore is an acknowledgment of liability of the committee to the extent of Rs. 3,500 to Venkayya. It is not necessary that in the promissory note itself the fact that it is an acknowledgment should be recited; the execution of the note itself is in acknowledgment of the liability. When a person borrows a certain sum of money and executes a promissory note he executes it for the consideration received by him and when it is executed in respect of a consideration already passed it is an acknowledgment of the liability to pay the amount mentioned in the note. It was held in Nachimuthu Chetty v. Andiappa Pillai (1917) 6 LW 630 that though a promissory note cannot be enforced as offending against Section 26 of the Paper Currency Act it can nevertheless be used as evidence of an acknowledgment of liability. This case was followed in Natarajulu Naicker v. Subramanian Chettiar I.L.R. (1922) Mad. 778 Ex. E mentions the proceedings of the committee and recites the fact that it is executed on behalf of the committee. Ex. E therefore is an acknowledgment of liability within the meaning of Section 19 of the Limitation Act and the suit filed within three years of it is not barred by limitation.
The appeal is allowed and the Lower Court will try the other issues in the case. The appellants will be entitled to the costs of this Second Appeal.