THAVVA SUBRAHMANYAM Vs. CHENNA VENKATARATNAM

JUDGEMENT

(1.) Umamaheswaram J. has referred this appeal to a Bench as, in the learned Judge's view, the question of law raised is one of importance and there was a conflict of authorities on the same.

(2.) The relevant facts, that gave rise to the appeal, may be briefly stated. The plaintiff is a merchant of Kanuparthi dealing in salt and the defendant is a merchant of Bezwada dealing in the same commodity. The defendant was purchasing salt from the plaintiff and was paying amounts towards purchase price from time to time. On 27-8-1946, he issued a cheque on the Andhra Bank in favour of the plaintiff and the cheque was cashed and credited in the plaintiff's account on 27-8-1946. The suit was filed on 24-12-1948. The suit would be barred by limitation if the payment of Rs. 121-2-0 by the issue of a cheque did not operate as payment within the meaning of Section 20, Limitation Act. The short question, therefore, is whether a payment by cheque made by, a debtor in favour of a creditor is a payment which satisfies the terms of Section 20 Limitation Act. Section 20 reads:

(3.) The proviso to Sub-section (1) was substituted by the Indian Limitation (Amendment) Act (Act I of 1927) in the place of the old Proviso which stood as follows: