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Judgment
P.R. Shivakumar, J.—This Appeal is directed against the judgment and decree dated 8.11.1996 made in O.S. No. 76/1994 on the file of
the Principal Subordinate Judge, Nagapattinam. The defendant in the Suit is the Appellant herein. The First Respondent herein had instituted the
above said original Suit against the Appellant herein for the recovery of a sum of Rs. 5,70,000/- towards the principal and interest upto the date of
the Suit along with subsequent interest on the basis of his contention that the appellant herein/defendant borrowed a sum of Rs. 4,00,000/- from
the respondent herein/Plaintiff in April 1989 to meet the expenses of the marriage of his son and daughter proposed to be arranged shortly
thereafter.
It was the further contention of the 1st respondent herein/Plaintiff that, as the marriage of Janaki, daughter of the Appellant herein/defendant with
the son of the 1st respondent/Plaintiff had been fixed and the Appellant herein/defendant proposed to arrange for the marriage of his son also, he
wanted the above said financial assistance from the 1st respondent/Plaintiff promising to repay the same with interest and that the
respondent/Plaintiff, taking into account the fact the appellant/defendant was going to be the father-in-law of the son of the first respondent/Plaintiff,
obliged and made payment as requested by the appellant herein/defendant. It is the further case of the respondent/Plaintiff that since the matrimony
between the above said Janaki (daughter of the appellant/defendant) and the son of the first respondent/Plaintiff did not last long and it broke down
within a couple of months after their marriage and the said Janaki went to the extent of giving a complaint in the police station at Nagapattinam
alleging commission of offences under the provisions of the Dowry Prohibition Act by the family members of the 1st respondent/Plaintiff, the 1st
respondent/Plaintiff had to demand repayment of the amount lent by him to the appellant/defendant; that the appellant/defendant on the other hand
tried to set up a false case as if the said amount was paid for purchasing the house of the appellant/defendant and subsequently, the
respondent/Plaintiff retracting from the said commitment refused to purchase the property and insisted upon repayment of the amount; that the
appellant/defendant also made attempts to sell the property in order to defeat the claim of the 1st respondent/Plaintiff and that in such
circumstances, the Plaintiff was constrained to cause a notice to be issued by his son through a lawyer and an advertisement in the newspaper
informing the public that they should not purchase the property before ever the claim of the 1st respondent/Plaintiff could be settled and filed a Suit
for the recovery of the above said amount when a reply containing false allegations was received from the appellant/defendant.
According to the Plaint averments, even though the amount was lent in the month of April 1989, the appellant/defendant made
acknowledgements in writing on 15.3.1991 at the first instance, on 3.7.1991 at the second instance, on 17.10.1993 and 22.12.1993 respectively
on the third and fourth instances and in view of the said acknowledgements limitations started afresh on each occasion when such
acknowledgement was made and hence the Suit was not barred by limitation.
The Suit was resisted by the appellant/defendant by putting in a written statement containing the following allegations:
The appellant/defendant never admitted that he borrowed a sum of Rs. 4,00,000/-from the 1st respondent/Plaintiff and the admission made by him
was to the effect that only a sum of Rs. 3,00,000/- was received by him from the 1st respondent/Plaintiff. It was the 1st respondent/Plaintiff, who
approached the appellant/defendant with a proposal for the marriage of the son of the Plaintiff with the daughter of the defendant. As the
appellant/defendant did not have funds for arranging the marriage, he informed the 1st respondent/Plaintiff that he could arrange the marriage
provided the 1st respondent/Plaintiff gave him financial assistance. In such circumstances, the 1st respondent/Plaintiff came forward to purchase the
house property of the appellant/defendant for a sum of Rs. 5,50,000/-. Out of the above said agreed amount, 1st respondent/Plaintiff paid only a
sum of Rs. 2,92,000/- to the appellant/defendant and promised to utilise another sum of Rs. 1,00,000/- for purchasing jewels for the daughter of
the appellant/defendant. However, the 1st respondent/Plaintiff did not give any jewels to Janaki, the daughter of the appellant/defendant. As the
amount was lent, according to the plaint averments, in April 1989, the Suit should have been filed before the end of April 1992. Even on the basis
of the alleged acknowledgement in the form of a letter dated 15.3.1991, the Suit should have been filed on or before 15.3.1994. As the Suit was
not filed on or before 15.3.1994 and it was in fact filed on 30.3.1994, the Suit should be dismissed as barred by limitation. The alleged letter dated
3.7.1991 addressed to Thiru. Ramamurthy, the son-in-law of the respondent/Plaintiff, by no stretch of imagination, could be construed to be an
acknowledgement of liability. The said letter was not addressed to the respondent/Plaintiff and hence he cannot claim it to be an acknowledgement
saving limitation. Therefore, the Suit should be dismissed as hopelessly barred by limitation.
Based on the above said pleadings made by the respective parties, the learned Trial Judge framed three issues as follows:
(1) Whether the Suit is barred by limitation?
(2) Whether the Plaintiff is entitled to the relief as prayed for in the Plaint? and
(3) What are the other reliefs to which the Plaintiff is entitled?
On the above said issues the parties went for trial, in which the Plaintiff examined himself as the sole witness, namely PW-1 on his side and
produced seven documents, marked as Ex.A1 to A7. Including appellant/defendant, three witnesses were examined as DW-1 to DW-3 and seven
documents were produced and marked as Ex.B1 to Ex.B7 on the side of the appellant/defendant.
At the conclusion of Trial, the Court below considered the pleadings made and the evidence brought-forth on either side in the light of the
arguments advanced by respective counsel. Upon such a consideration, the learned Principal Subordinate Judge, Nagapattinam pronounced a
judgment on 8.11.1996 sustaining the claim made by the 1st respondent/Plaintiff and decreeing the Suit in part. As per the decree drafted in the
above said judgment, the appellant/defendant was directed to pay a sum of Rs. 4,00,000/- along with an interest for the above said amount at the
rate of 9% per annum from 21.9.1993 and thereafter at the rate of 6% per annum till realization.
Aggrieved by and challenging the above said judgment and decree, the appellant herein/defendant in the Suit has brought-forth this Appeal on
various grounds set out in the Memorandum of Appeal.
This Court heard the submissions made by Mr. P. Mani, learned counsel for the appellant and Mrs. R.T. Shyamala, learned Counsel for the
second and third respondent. The materials available on record submitted by the Trial Court for reference in this Appeal were also considered.
Admittedly, there was a money transaction in the month of April 1989 between the appellant/defendant and the 1st respondent/Plaintiff.
According to the 1st respondent/Plaintiff the same was a loan transaction in which the Plaintiff was the creditor and the defendant was the
borrower. On the other hand, the appellant/defendant would contend that the transaction was not a loan transaction and in fact it was an agreement
for the sale of the house property of the appellant/defendant and that the 1st respondent/Plaintiff, who agreed to purchase the property for rupees
51/2 lakhs, paid an amount as advance and part consideration. Therefore, the first and foremost controversy between the parties is as to the nature
of the transaction between them. The next controversy is regarding the actual. amount paid by the 1st respondent/Plaintiff to the
appellant/defendant. According to the plaint averments the Plaintiff paid a sum of Rs. 4,00,000/-. Per contra, it is the contention of the
appellant/defendant that only a sum of Rs. 2,92,000/- was paid and a sum of Rs. 1,00,000/- was retained by the Plaintiff for the purchase of
jewels for Janaki, daughter of the appellant herein/defendant. It is his further contention that no jewel was purchased and given to the daughter of
the Appellant herein/defendant by the 1st respondent/Plaintiff and hence the said sum of Rs. 1,00,000/- could not be taken as an amount paid to
the appellant/defendant.
The next point in issue is regarding the alleged acknowledgement. The appellant/defendant did not deny in written statement that he made an
acknowledgement in his letter dated 15.3.1991 to the 1st respondent/Plaintiff. The said letter has been marked as Ex.A1. The appellant/defendant
would contend that even assuming that the said letter contains an acknowledgment of liability, the same would not save the Suit of the Plaintiff from
being barred by limitation, as the Suit was not filed within three years from the said date. But the 1st respondent/Plaintiff relies on yet another letter
written by the appellant/defendant to one Ramamurthy, the son-in-law of the Plaintiff containing acknowledgement of the liability. The same has
been marked as Ex.A2. Apart from the said letter addressed to Ramamurthy, one more document, namely the reply notice sent by the
appellant/defendant to the respondent/Plaintiff on 17.10.1993 and marked as Ex.A5 is also relied on by the 1st respondent/Plaintiff as
acknowledgement of liability which would save the Suit of the Plaintiff from being barred by limitation. Therefore the points that arise for
consideration in this Appeal are:
(1) Whether the Suit is barred by limitation? and
(2) Whether the Plaintiff is entitled to a decree for recovery of a sum of Rs. 4,00,000/- with subsequent interest ?
The Plaintiff and the defendant are closely related. The defendant''s daughter Janaki was given in marriage to the son of the Plaintiff. As such
the Plaintiff is none other than the father-in-law of the daughter of the defendant. But, unfortunately the matrimonial bliss was a short lived one and
within a couple of months after marriage, that too, when the said Janaki was in the family way, the couple had to part their ways. The relationship
got strained further, as the said Janaki gave a Complaint to the Police alleging dowry harassment and her husband (son of the Plaintiff) initiated
judicial proceedings for dissolution of marriage. However, ultimately the said Divorce Petition, namely HMOP No. 195/1993 instituted on the file
of Sub-Court, Nagapattinam was dismissed as withdrawn. Under such circumstances, the Plaintiff filed the Suit for the recovery of the amount
allegedly lent by him to the defendant. The above said background should be kept in mind for proper appreciation of the case of both parties.
According to the Plaintiff''s case, the defendant wanted the Plaintiff to help him financially by advancing him a loan of Rs. 4,00,000/- as the
defendant wanted to arrange for the marriage of his son also and the Plaintiff obliged him and lent him the above said sum because the marriage of
Janaki, daughter of the defendant, with the son of the Plaintiff had then been finalised and the Plaintiff was the father-in-law designate of the said
Janaki.
On the other hand, the defendant would contend that though he was not financially prepared to arrange for the marriage of his daughter Janaki,
the Plaintiff who came with the proposal to get Janaki married to the son of the Plaintiff, came forward to give him the money needed for the said
marriage on the understanding that the Plaintiff would purchase the house of the defendant for a sum of Rs. 5 1/2 lakhs. The first and foremost
contention of the defendant before the Trial Court happened to be that the transaction between the Plaintiff and the defendant being one of
agreement for sale, the Suit instituted as a simple money Suit was not maintainable. In this regard, reference can be made to the evidence adduced
on either side. The Plaintiff, who deposed as PW-1 was categorical in his assertion that he did not enter into any agreement or understanding with
the defendant to purchase the house property of the defendant. On the other hand, the Plaintiff submitted that he paid a sum of Rs. 4,00,000/- as
loan to the defendant and the defendant instead of repaying the said amount wanted the Plaintiff to purchase the house property of the defendant
which the Plaintiff promptly declined and that the defendant falsely tried to set up a case as if the Plaintiff had entered into an agreement for the
purchase of the house property of the defendant and for that purpose alone the payment to the defendant was made.
The defendant who deposed as DW-1 would admit that there was no document evidencing the amount paid by the Plaintiff to the defendant
and that it was done on mutual trust and understanding. He would also admit that he wrote the letters addressed to the Plaintiff and his son-in-law
admitting that he received a sum of Rs. 4,00,000/- from the Plaintiff. However, he would add that he received a sum of Rs. 2,92,000/- alone and
in view of the promise made by the Plaintiff to give jewels worth Rs. 1,00,000/- to Janaki, he had made such an admission in the letters to the
effect that the amount received by him was Rs. 4,00,000/-. The other two witnesses examined on the side of the defendant, namely DW-2 and 3,
have not deposed anything about the transaction between the Plaintiff and the defendant. However, they have stated that one Janarthanam came
forward to purchase the house property of the defendant for a sum of Rs. 5,80,000/- and a sum of Rs. 3,00,000/- was paid by him as advance. It
was nothing but an attempt made by the defendant to show that only a sum of Rs. 3,00,000/- was due to the Plaintiff and that when the said
amount was tendered, the Plaintiff refused to accept the same. A close consideration of the evidence of DWs-1 to 3 in this regard, shows
existence of a lot of contradictions, making the said contention improbable. DW-1 in his evidence would state that he entered into an agreement
with one Santhabai, wife of Janarthanam for the sale of his house property for a sum of Rs. 5,80,000/-. He would also state that on the date of
agreement itself a sale deed was prepared but the sale transaction could not be completed as he was not able to get back the title deed from the
Plaintiff. According to the case of the defendant, the title deed had been given to the Plaintiff pursuant to a mediation made in the police station.
Neither the sale agreement nor the draft sale deed prepared pursuant to the agreement between the defendant and Santhabai, wife of Janarthanam
has been produced. DW-1 has not stated anything regarding the actual amount he received from Santhabai, wife of Janarthanam.
On the other hand, DW-2 would state in his evidence that a sum of Rs. 3,00,000/- was paid by Santhabai, wife of Janarthanam as advance
and a voucher was passed for the same. The said voucher has not seen the light of the day.
The evidence of DW-3 was quite contra to the evidence of DW-2. He would state that on the date of finalization of the sale agreement, a sum
of Rs. 101/- alone was paid as advance and a further sum of Rs. 3,00,000/- was paid subsequently. Though DW-3 during cross-examination,
would state that in the voucher evidencing payment by Santhabai, wife of Janarthanam, a sum of Rs. 3,61,000/- was noted as the amount paid and
that he had attested the said voucher. He was also not able to state the date on which the said voucher was obtained. A copy of alleged mochalika
signed by the parties pursuant to the mediation made in the police station in an enquiry conducted by the Police on the Complaint made by Janaki
has been marked as Ex.B5. In the said document it has been stated that the defendant promised to pay back the amount borrowed by him from
the Plaintiff after selling his house. A similar mochalika signed by the defendant has also been marked as Ex.B4. Ex.B4 and B5 do not contain any
recital to the effect that the amount was paid by the Plaintiff as price for the purchase of the property or that there was any agreement between the
Plaintiff and the defendant for the sale of the said property to the Plaintiff. On the other hand, it is obvious from the said documents that the
defendant agreed having borrowed from the Plaintiff and consented for leaving the title deed of his property with the Plaintiff till he makes
arrangement for payment of the amount due to the Plaintiff after selling the property to any third party.
Furthermore, Ex.A1 and A2 are the letters admittedly written and sent by the defendant addressed to the Plaintiff and one Ramamurthy, son-
in-law of the Plaintiff respectively. In both the letters the defendant has admitted having received a sum of Rs. 4,00,000/- from the Plaintiff. As per
the contents of the said letters the defendant received a sum of Rs. 3,00,000/-from the Plaintiff for meeting the marriage expenses and a further
sum of Rs. 1,00,000/- for purchasing jewels for his daughter. No where in those letters it has been stated that a sum of Rs. 1,00,000/- was
retained by the Plaintiff to purchase jewels for Janaki. On the other hand clear admission has been made in those documents to the effect that the
defendant received a sum of Rs. 1,00,000/- to meet the expenses of purchasing jewels for his daughter Janaki.
Ex.A3 is the legal notice sent by the Plaintiff through his lawyer to the defendant. Clear assertion was made in the said notice that a sum of Rs.
4,00,000/- was lent to the defendant in April 1989. Ex.A4 is the acknowledgement, Ex.A5 is the reply to the above said notice sent by the
defendant himself with his signature. The allegation made in the notice that the defendant borrowed a sum of Rs. 4,00,000/- from the Plaintiff in
April 1989 was not specifically denied in the reply notice. On the other hand he had expressed his willingness to make payment as demanded in
the notice. The said willingness expressed in the vernacular language is extracted hereunder.
Another notice sent to the defendant by the Plaintiff through his advocate dated 18.12.1993 is Ex.A6. Ex.B7 is the reply sent by the defendant
with his signature for the said notice. Only in the said notice, the defendant has come forward with the plea now he has made in the written
statement regarding the amount received. The Court below, after evaluating the evidence adduced on both side, has come to a correct conclusion
that the defendant borrowed a sum of Rs. 4,00,000/- from the Plaintiff and that the contention of the defendant as if he received only a sum of Rs.
2,92,000/- could not be sustained. This Court, being the Appellate Court and the Final Court for Appeal on facts, also meticulously considered the
evidences, both oral and documentary and upon such a consideration, concurs with the view expressed by the Court below. This Court finds no
defect or infirmity with the above finding of the Court below warranting interference with the same in this Appeal. Therefore, this Court comes to
the conclusion that the Plaintiff has proved his case of lending a sum of Rs. 4,00,000/- to the defendant in the month of April 1989.
According to the Plaintiffs case, the amount was lent in the month of April 1989. If there is no subsequent acknowledgement, then the period
of limitation for filing the Suit would have been over by the end of April 1992. As this Suit has been filed only on 30.3.1994, in the absence of
acknowledgment the Suit would have been barred by limitation. There is no dispute over such a proposition. But in the instant case, the 1st
respondent/Plaintiff has relied on the plea of acknowledgement of liability and fresh start of limitation from the date of acknowledgement. Ex.A1
and A2 are the alleged acknowledgements relied on by the Plaintiff. There is also no controversy regarding the proposition that an
acknowledgement to be valid should be made before the expiry of the period of limitation. Section 18 of the Limitation Act reads as follows:
Effect of acknowledgment in writing. -- (1) Where, before the expiration of the prescribed period for a Suit or Application in respect of any
property or right, an acknowledgement of liability in respect of such property or right has been made in writing signed by the party against whom
such property or right is claimed, or by any person through whom he derives his title of liability, a fresh period of limitation shall be computed from
the time when the acknowledgment was so signed.
(2) Where the writing containing the acknowledgment is undated, oral evidence may be given of the time when it was signed; but subject to the
provisions of the Indian Evidence Act, 1872 (1 of 1872), oral evidence of its contents shall not be received.
Explanation: For the purposes of this Section --
(a) an acknowledgement may be sufficient though it omits to specify the exact nature of the property or right, or avers that the time for payment,
delivery, performance or enjoyment has not yet come or is accompanied by a refusal to pay, delivery, perform or permit to enjoy, or is coupled
with a claim to set-off, or is addressed to a person other than a person entitled to the property or right;
(b) the word ""signed"" means signed either personally or by an agent duly authorised in this behalf; and
(c) an Application for the execution of a decree or order shall not be deemed to be an Application in respect of any property or right.
As per the language of the above said section, the acknowledgement should be in writing and signed by the person making the
acknowledgement. So far as Ex.A1 letter is concerned, there is an admission by the defendant in the written statement as well as his evidence as
DW-1 that the said letter was written by him to the Plaintiff. It is not the case of the defendant that Ex.A1 would not amount to acknowledgement
of the liability. On the other hand, it is the contention of the defendant that the said letter was dated 15.03.1991 and if the said letter containing
acknowledgement is to give new start of the period of limitation, the Suit should have been filed on or before 15.3.1994 and that the Suit filed on
30.03.1994 is barred by limitation. Of course it is true that the Suit would have been barred by limitation provided there is no subsequent
acknowledgement. But, unfortunately for the defendant, there is another acknowledgement in writing made by him in the form of Ex.A2. Ex.A2 is a
letter written by the defendant to one Ramamurthy, the son-in-law of the Plaintiff. The said letter contains clear acknowledgement that the
defendant borrowed a sum of Rs. 4,00,000/- from the Plaintiff. Of course the said letter was not addressed to the creditor, namely the Plaintiff.
But it is not necessary that the acknowledgement of liability should be addressed to the creditor himself. The Section itself contains following
explanation:
The acknowledgement need not be addressed to the creditor or the person having right to institute the Suit or to make the Application in respect of
the same property or right or communicated to him.
It may be in the form of recital in document executed even in favour of a stranger. The conditions required for a valid acknowledgement have been
listed in the judgement of a Division Bench of this Court made in VS. Manickasundaram v. V.S. Ramalinga Gounder & Co. by Partner, Palanivelu,
Park Road, Erode and others, 2004 (2) CTC 624. They are as follows:
(a) It must be an acknowledgement or affirming admission of an accepting liability. But the acknowledgement need not directly refer to the liability
sought to be enforced in the Suit.
(b) It must be made by the person under the liability. The liability must relate to some debt or other obligation or to some property or right.
(c) The liability must be subsisting on the date of the acknowledgement; it must not have become barred, or satisfied, or destroyed.
(d) The acknowledgement must be made before the expiry of the period prescribed for a Suit or Application in respect of such property or right.
(e) The acknowledgement must be in writing.
(f) The acknowledgement must be signed.
(g) The signature must be of the party against whom such property or right is claimed, or of some person through whom he derives title or liability.
(h) The acknowledgement must not be vague or ambiguous.
(i) The surrounding circumstances are also relevant and can be taken into consideration in construing the words in which an acknowledgement is
said to have been expressed.
In the instant case, admittedly, Ex.A2 was written by the defendant to Ramamurthy, son-in-law of the Plaintiff. But, it does not contain his
signature. Therefore, the same shall not amount to a valid acknowledgement as per Section 18 of Limitation Act which says that the
acknowledgment shall be in writing and signed by the person making acknowledgment of liability.
However, even if the letter addressed to Ramamurthy, the son-in-law of the Plaintiff (marked as Ex.A2) will not amount to a proper
acknowledgment of liability u/s 18 of the Limitation Act, there is yet another document evidencing that the defendant has made an acknowledgment
of liability on 17.10.1993 i.e well within three years from the date of Ex.A1. The said document is none other than the reply notice sent by the
defendant with his signature for Ex.A3 notice. In Ex.A5-reply notice, the defendant has clearly admitted and acknowledged his liability stating that
he was prepared to make payment to the Plaintiff. In Ex.A3 notice it was clearly averred that the defendant had borrowed a sum of Rs. 4,00,000/-
. The amount was not disputed in the reply, namely Ex.A5. On the other hand, he expressed his willingness to make payment as demanded in the
notice.
However, he had also made a request that his daughter should be allowed to live with her husband, namely the son of the Plaintiff. In the light of the
above said document, this Court comes to the conclusion that there is a clear acknowledgment of liability of the defendant towards the Plaintiff and
that the same has saved the limitation and made the Suit filed the Plaintiff well within the period of limitation. The Court below, on proper
appreciation of evidence, has come to a correct conclusion that the Suit is not barred by limitation. The well considered finding of the Court below
in this regard, deserves confirmation. Accordingly, the same is confirmed.
The next contention of the defendant is that as there was no contract for payment of interest, the Court below should not have awarded
interest. Of course, the Plaintiff has claimed interest from the date of borrowal at the rate of 9% per annum. But simply because there is no contract
for payment of interest it does not mean that the creditor cannot claim interest and that the Court does not have power to award interest. Payment
of interest in such cases shall be governed by the provisions of the Interest Act and reasonable interest can be awarded. The Plaintiff has claimed
only 9% interest from the date of transaction. However, taking into account the relationship of the parties at the time of transaction, the Court
below has chosen to award interest only from the date of demand made by the Plaintiff for repayment of the amount lent to the defendant. The said
course adopted by the Court below cannot be said to be against law or unreasonable. The Court below has chosen to award interest at the rate of
9% per annum from the date on which the Plaintiff issued a notice to the defendant demanding payment of amount i.e. 21.09.1993. The Court
below also restricted the said rate of interest up to the date of decree alone and allowed 6% subsequent interest from the date of decree till
realisation in tune with the tenor of Section 34 of Civil Procedure Code. This Court finds nothing wrong in the procedure adopted by the Court
below. The said fining also deserves to be confirmed.
For all the reasons stated above, this Court comes to the conclusion that there is no merit in the Appeal preferred against the judgment and
decree of the Court below. There is no scope, whatsoever, to interfere with the well considered judgment of the Court below and the Appeal
deserves to be dismissed confirming the decree passed by the Trial Court. In the result, the judgment and decree of the Court below dated
8.11.1996 is confirmed and the Appeal is dismissed with costs. Consequently, connected Miscellaneous Petition is also closed.