LALAM SAMBAYYA Vs. PATTAM SHEMSHERKHAN

JUDGEMENT

(1.) The question that falls for determination in this revision petition is whether a statement made by a witness in the court admitting a time-barred debt fulfils the requirements of Section 25 (3) of the Contract Act. The relevant facts to appreciate the arguments may briefly be stated. The petitioner herein borrowed a sum of Rs. 200.00from the plaintiff-respondent and Executed a promissory note in his favour on 16-7-1951 agreeing to pay interest at the rate of 6 per cent per annum. On 15-6-1954 he paid a sum of Rs. 5.00 and made an endorsement on the pronote. There were no subsequent payments and the claim became time-barred. On 18-8-1958 he was examined as a witness in the case in which the respondent herein was the 1st defendant (O.S. No. 30 of 1958). During the course of cross-examination he stated as under: "I executed a pronote for Rs. 200.00 in favour of the 1st defendant and I am prepared to pay off the debt even now." On that basis, the respondent issued notices and thereafter filed a suit for the recovery of the amount to the tune of Rs. 277-154. The petitioner contended that the pronote was without consideration and that the claim had become time-barred, the statement made by him being not sufficient in save the statutory time limit. The District Munsif-Magistrate Narasapatnam formulated two points for consideration : (i) Whether the pronote was supported by consideration; and (ii) Whether the suit was in time. In regard to the first point he held in favour of the plaintiff with which we are not concerned. As to the question of limitation by referring to the analogous provisions of Section 19 of Limitation Act he found that the statement made by the petitioner as a witness in the course of his examination in O.S. No. 30 of 1958 amounted to a fresh contract within the meaning of Section 25 (3) of the Contract Act and saved limitation. The revision petition is directed against this finding.

(2.) It is common ground that at the time when the statement referred to above was made by the petitioner the debt was not subsisting, so that the provisions of Section 19 of the Limitation Act were not available and it is only the provisions of Section 25(3) of the Contract Act, if applicable, could save the claim from being time-barred. The learned Munsif with reference to Section 19 of the Limitation Act held that when a deposition of a witness can be taken into consideration under Section 19 it can also be validly taken into account under Section 25 (3) of the Indian Contract Act. Section 19 of the Limitation Act lays down that: "(i) Where, before the expiration of the period prescribed for a suit or application in respect of any property or right, an acknowledgment of liability in respect of such properly or right has been made in writing signed by the party against whom such property or right is claimed, or by some person through whom he derives title or liability, a fresh period of limitation shall be computed from the time when the acknowledgment was so signed."

(3.) The section refers to an acknowledgment of liability in respect of a subsisting debt it has been held that a deposition of the debtor was sufficient for this purpose, but the question is whether a deposition of this nature could be held sufficient for the purpose of attracting the provisions of Section 25 (3) of the Contract Act. In other words, can an "acknowledgment" be equated to a fresh promise to pay a debt barred by limitation. The relevant provisions of Section 25 13) of the Contract Act are as under: "25. An agreement made without consideration is void, unless - (3) it is a promise, made in writing and signed by the person to be charged therewith, or by his agent generally or specially authorised in that behalf, to pay wholly or in part a debt of which the creditor might have enforced payment but for the law far the limitation of suits."