1. This is an appeal against the order of remand' passed by the lower appellate Court in a suit to enforce a mortgage. The only question arising for decision at this stage is the point of limitation raised by the third issue in the case. The District Munsiff held in limine that the suit was barred by~ limitation, but the learned Subordinate Judge held otherwise and remanded the suit for disposal on the merits.
2. The plaintiff seeks to enforce a mortgage dated 15th November, 1913, and the question for decision is whether the reference to it in Ex. A, a sale deed dated 11th November, 1921, amounts to an acknowledgment of liability at least to the extent of Rs. 850 in respect of the mortgage of 15th November, 1913. The substance of the statements in Ex. A is that on 11th November, 1921, a sum exceeding Rs. 850 was due from the debtor to the creditor on settlement of accounts, that the debtor was attempting to discharge the debt to the extent of Rs. 850 by the sale of certain properties under Ex. A and that for the balance due in excess of Rs. 850 he made provision for discharge by execution of other documents. On behalf of the mortgagor it is contended that the above statements do not amount to an admission of subsisting liability on 11th November, 1921, as required by law to constitute an acknowledgment. I am unable to agree.
3. The cases cited by the earned Counsel for the appellant will be found on examination to relate to statements to the effect that even before the date of the statement the liability had been discharged. Vide Ram Das v. Birjnundun Das I.L.R.(1882) 9 Cal. 616, Venkata v. Parthasarathi (1892) 3 M.L.J. 35 : I.L.R. 16 Mad. 220 and Chhaterdhari Mahto v. Nasib Singh (1923) 78 I.C. 919. In the present case, it is not the statement in Ex. A that the mortgagor's liability had ceased prior thereto; on the other hand, he accepted the liability as a subsisting liability on that day and took steps to discharge the same. If in law that discharge had proved effective, there would have been no further question. But it happened in this case that prior to the date of Ex. A the mortgagee had sub-mortgaged his interest in favour of the present plaintiff's assignor and the sale under Ex. A did not therefore operate in law to discharge the mortgage. But it is not on that account reasonable to construe the statement in Ex. A as not amounting to an admission of liability which, but for the intended sale, would have been a subsisting liability. Mr. Swaminatha Aiyar relied on the observation in Venkata v. Parthasarathi (1892) 3 M.L.J. 35 : I.L.R. 1892 16 Mad. 220 to the effect that from the statement:
An intention to continue the pre-existing jural relationship until it is lawfully determined must also be evident.
4. I do not see why the present case cannot be held to satisfy the test stated in those terms. The position was that the mortgagor and the mortgagee thought that the sale under Ex. A sufficed to determine the pre-existing relationship of debtor and creditor but there they were in error. It may be useful to refer to an observation at page 222 in the same judgment to the effect that:
the acknowledgment must be such as will lead the Court to infer an intention on the part of the writer to pay or satisfy the debt.
5. It was certainly so here.
6. The present case is governed by the line of authority which holds that an admission of liability coupled with a declaration as regards the arrangement proposed for its satisfaction is a sufficient acknowledgment - see Shriniwas v. Narhar I.L.R.(1908) 32 Bom. 296 Dajji Mahar v. Mahadeo Kunbi (1924) 79 I.C. 66 and Kuppuswami Aiyar v. Sabapathy Pathan (1936) 44 L.W. 362. See also Rustomji's Law of Limitation, 4th Edition, page 166. The argument may be tested by an illustration. Suppose the mortgagor did not complete the sale by registration of the document; can there be any doubt that the statement in the document will be available as an acknowledgment of liability? I do not see why the position should be different when the contemplated discharge proved ineffective because the mortgagee to whom the conveyance was made had by that time become incompetent in law to give a discharge by reason of the anterior sub-mortgage.
7. The appeal fails and is dismissed with costs of the plaintiff-first respondent.
8. Leave refused.