KUNDAN LAL Vs. JAGANNATH

JUDGEMENT

(1.) This appeal arises out of a suit upon foot of a simple money bond, dated the 10th of September, 1910. The defendant pleaded payment. The court of first instance decreed the plaintiff s claim. The lower appellate court found that the defendant had made a payment by a cheque; that the plaintiff had not made any appropriation of the payment, and that accordingly the payment should be credited to the earliest debt then due by the defendant to the plaintiff which was the bond sued upon. The lower court says that the way the accounts were kept between the plaintiff and the defendant was that on the one side all advances made by the plaintiff to the defendant were, entered and on the other side all the payments that were made to the plaintiff by the defendant. He seems to have been prepared to hold that from the way the account was kept the plaintiff must be deemed to have from time to time appropriated the payments to the earliest debts. The case, however, was really decided on the assumption that there had been no appropriation by either party and it is on this basis that the case has been argued before us.

(2.) Section 60 of the Contract Act is as follows : "Where the; debtor has omitted to intimate and there are no other circumstances indicating to which debt the payment is to be applied, the creditor may apply it at his discretion to any lawful debt actually due and payable to him from the debtor, whether the recovery is or is not barred by the jaw in force for the time being as to the limitation of suits."

(3.) Section 61. - "Where neither party makes any appropriation, the payment shall be applied in discharge of the debts in order of time, whether they are or are not barred by the law in force for the time being as to the limitation of suits. If the debts are of equal standing the payment shall be applied in discharge of each, proportionately."