PROSANNA KUMARI MAZUMDAR Vs. TRIPURA CHARAN CHOWDHURY

JUDGEMENT

(1.) This Rule has been obtained by the plaintiff in a suit to recover a sum of money. It has been dismissed by the Court of first instance on the ground of limitation. The suit was instituted on 17 July 1935. The plaintiff's case in the plaint is that the defendant borrowed money from him on 11 January 1932 on a promissory note executed on the said date. In the promissory note there is a stipulation to pay interest at the rate of 3 pies a day. Then the plaint recites that on 3 July 1933 there was a settlement of accounts between the plaintiff and the defendant, and the dues of the plaintiff were calculated at a rate of interest which was not the rate of interest provided for in the promissory note. The rate of interest on which the calculation proceeded was at the rate of one anna per month. On that date the sum of Rs. 137-8-0 was found due from the defendant to the piaintiff. Rs. 100 on account of the principal and Rs. 37-8-0 on account of interest. Then the plaintiff says in his plaint that he is entitled to claim on the basis of this settled account and he added interest to the sum of Rs. 100 at the rate of one anna per month. He dates his cause of action to be this settlement of account and says expressly in his plaint that the cause of action arose on 3 July 1933, the date of this settlement. For the purpose of supporting his case he put in the promissory note because on the back of it the following is the endorsement over the signature of the defendant: Interest is calculated at the rate of 12 pies per month from the date of the pro- note to 3 July, that is for one year five months and twenty-two days. Rs. 137-8-0 is found due, that is Rs. 37-8-0 for interest and Rs. 100 being the principal.

(2.) Then there is the endorsement over the signature of the defendant "that the sum of Rs. 137-8-0 remains due (Missing text)." This endorsement on the back of the promissory note was not stamped. The learned S. C. C. Judge proceeded upon the basis as if the suit was a suit on the promissory note. Then he said that the suit was filed admittedly beyond three years from the date of the promissory note and the loan, and it would be barred unless the endorsement on the back of the promissory note could be proved as an acknowledgment of liability. He said that the endorsement on the back of the note is an acknowledgment of liability within the meaning of Art. 1-A, Stamp Act, and, inasmuch as the said endorsement has not been stamped with a one anna stamp, the endorsement cannot be admitted in evidence, by virtue of the provisions of Section 35, Stamp Act. It is not necessary in this case for me to decide whether the endorsement on the back of the promissory note is an acknowledgment within the meaning of Art. 1-A, Stamp Act, for in my view the Court below in deciding the question of limitation has proceeded wholly upon a misconception of the plaintiff's case as made in the plaint. The plaintiff's suit is not based on the promissory note. The plaintiff expressly states that his cause of action arose upon the settlement account as endorsed upon the back of the promissory note over the defendants signature, and he dates his cause of action not from the date of the promissory note but from the date of the said settlement of account, and further states that the settlement account as contained on the back of the promissory note is his cause of action, that is to say he states that he is entitled to sue upon an account stated, the said account being stated on the back of the promissory note.

(3.) It is therefore necessary to consider whether his suit as framed is barred by limitation or not. If the endorsement on the back of the promissory note brings the case within Art. 64, Lim. Act, the suit is clearly within time because the suit has been instituted within three years of 3 July 1933. In my judgment the case comes within Art. 64, Lim. Act, and in the view which I am taking I am supported by two recent decisions of the Judicial Committee of the Privy Council in Siqueria V/s. Noronha 1934 P C 144 and the case in Firm Bishnu Chand v. Girdhari Lal 1934 P C 147. The first case was a case instituted by the plaintiff for sums of money said to be due to him on account of his salary. The plaintiff in that case was an assistant of the defendant firm. He was employed in the year 1913 and at the time of his employment his salary was not fixed, but he withdrew moneys on his own account from time to time, during the course of 15 years, when he was in service. At the time when he ceased to be in service, Mr. Rodrigues, the managing partner of the firm, gave him a letter in which the accounts were stated, that is to say his salary was fixed and calculated and the amounts drawn by him from time to time taken into account, and it was stated in that letter that a certain amount was due to the plaintiff. This account was given to the plaintiff within three years of his suit. As has been pointed out in the latter case I have referred to, Lord Wright observed that in this case, namely the case in Siqueria V/s. Noronha 1934 P C 144, the figures were taken from the account books of the firm which contained entries only on one side, namely the debit side, showing different amounts drawn by the plaintiff on different occasions on his own account, but the credit side, namely that where his pay was to be included, was left blank inasmuch as his pay was not settled. In the course of his judgment Lord Atkin pointed out that there were two classes of accounts stated. The second class is a class where there are on the account book itself cross demands between the plaintiff and the defendant and the cross demands are set off against each other. That is what is usually called accounts stated and the account so stated itself furnishes a cause of action, the set off on one item against another is the consideration to pay by one party to the other the balance found on settlement of account as due from one to the other. The other class of account stated is that where there are no cross demands or set offs. At p. 816 of the report, Lord Atkin makes the following observation with regard to this class of account stated. He says this: Their Lordships think that what has been forgotten is that there are two forms of account stated. An account stated may only take the form of a mere acknowledgment of a debt, and in those circumstances, though it is quite true it amounts to a promise and the existence of a debt may be inferred, that can be rebutted, and it may very well turn out that there is no real debt at all, and in those circumstances there would be no consideration and no binding promise.