Variety Supply Agency vs W.B. State Electricity Board and A.N.R.

A.M. Bhattacharjee, J.—The only question that falls for our determination in the matter at hand is whether the three letters, being Ext. 3, Ext. 3(a) and Ext. 3(b), would in law amount to acknowledgement of liability by and on behalf of the opposite parties within the meaning of section 18 of the Limitation Act, 1963 and that being the sole question, we proceed to reproduce those three letters herein below : Ext. 3(a) and Ext. 3(b) are the letter written by the Divisional Engineer of the West Bengal State Electricity Board to the petitioner and Ext. 3 is the letter written by the Divisional Engineer to the Advocate of the petitioner in reply to the demand notice served by the Advocate for and on behalf of the petitioner.

Ext. 3.

Dt. KGP. 31-8-84. 01-9-84.

To Sri Panchugopal Banerjee, L.L.B., Advocate Bhattacharjee Para, P.O. Khardah, Dist. 24-Parganas.

Sub: - Release of payment amounting to Rs. 8201.30 against our order no. MD/E/2/L/600 dt: 13-5-81 and subsequent bill no. VS/88/217 dt. 20-10-81 of M/s. Variety Supply Agency, 52. Aurabinda Sarani, Calcutta-700005.

Dear Sir

With reference to above, we acknowledge the receipt of your notice dated 6-6-84, on behalf of your client.

In this connection, it may be noted that we maintain a good customary-relation with your client who is a pretty old suppliers to the Board.

Furthermore, the undersigned has assumed the charges of this office very recently causing thereof no thorough information''s about such old disputed cases are known.

So, one of our officer is being advised to meet with Sri Ganguly of M/s. Variety Supply Agency to collect all information''s/papers etc. so as to facilitate to release the payment in question.

Meanwhile, we once again assure you that payment of your client''s bill will be settled shortly.

Yours faithfully. (C.K. Dasgupta) Divisional Engineer (oftg.) : Kharagpur (O&M) Division.

2.

Ext. 3 (a)

Dt. KGP.12-9-94 13-9-84

To M/s. Variety Supply Agency, 52, Aurabinda Sarani, Calcutta - 700 005.

Sub : - Submission of xerox copy of our order no. MD/E/ 2/1/660 dt 13-5-81 along with copy of authorization letter for collection of the articles etc.

Dear Sirs,

In continuation to this office letter no. MD/E/2/L/3522(1) dated 1-9-84 and further to discussion had between your Shri Ganguly with our Sri S. Chaudhuri on 10-9-84 at your office, we would request you to arrange to submit xerox copy of order no. MD/E/2/L/660 dated 13-5-81 along with authorization letter for collection of the articles in question, as no such copy is available at our end.

Yours faithfully. (C.K. Dasgupta) Divisional Engineer (Oftg.) Kharagpur (O&M) Division.

Ext. 3 (b)

Date : 2-8-82

M/s. Variety Supply Agency, 52, Arabinda Saranl, Calcutta-700005.

Sub :- Supply and deliver of Liveries.

Dear Sirs,

We like to know the details of bills which are vet to be paid for supply and delivery of Liveries against orders placed from this Office time to time. You are requested to submit duplicate bills along with xerox copy of signed challans duly signed by our authorized representative for making necessary payment.

Your reply need be sent to this end within 7 (seven) days.

Please treat this as urgent.

Yours faithfully, (D.M. Chowdhuri) Divisional Engineer.

The learned Judge of the 4th Bench of the Small Causes Court, who tried the suit, has held these letters to amount to acknowledgement and has decreed the suit. On an application u/s 38 of the Presidency Small Causes Court''s Act, a Full Bench of the Small Causes Court has overturned the decision of the trial Judge and has dismissed the suit as barred by limitation. We have given the matter our best consideration and we have no manner of doubt that these three letters, quoted hereinabove, clearly amount to acknowledgement of liability within the meaning of Section 18 of the Limitation Act and as such the suit, giving rise to this revisional proceeding, was not barred by limitation. That being so, the learned trial Judge was right in decreeing the suit and the Full bench was wrong in overturning the same.

It is now settled beyond doubt that in order to amount to an acknowledgement within the meaning of Section 18 of the Limitation Act, such acknowledgement need not be expressed or explicit and need not necessarily be in the form of I.O.U. or something similar thereto. It should be an idle parade to refer to the myriads of decisions on this point rendered by the different High Courts, the former Privy Council and also the Supreme Court and we would only proceed to refer to some of them to demonstrate the proposition.

As has been pointed out by a Division Bench of this Court in Kalipada Sinha Vs. Mahaluxmi Bank Ltd., ever since the decision of the Privy Council in Maniram Seth vs. Seth Riipchand ( ILR 33 Cal 1347 ), it has been established as a rule of law that admission of the existence of an unadjusted liability would bring the case within the purview of Section 19 (now Section 18) of the Limitation Act. There need not be any clear admission of liability, but if there is admission on facts of which the liability is a necessary consequence, that would be a sufficient acknowledgement for the purpose of limitation. The decision of this Court in Jainarain Vs. The Governor-General of India, is also a clear authority for the proposition" that if correspondence ensues between the parties in the course of which the alleged debtors goes on promising enquiry and never denying any liability, the limitation would not begin to run till such correspondence ends either fruitlessly or with a final refusal. Reference may also be made to a Division Bench decision of the Patna High Court in Joharmal-Mathuradas Firm Vs. Hira Lal-Shewchand Roy, where it has been clearly held that the statement contained in a letter to the effect that if upon comparison of accounts any amount is found due by the writer of the letter, he is prepared to pay it, is a sufficient acknowledgement of liability for the purpose of limitation. Reference may also be made to the Division Bench decision of the Allahabad High Court in Mohammad Abdullah Khan Vs. Ford and Macdonald Co. Ltd. for the proposition that if from the letter it appears that inevitable deduction from the admission is that the party against whom money is claimed has acknowledged his liability to pay if the balance should be ascertained to be against him, the statement is sufficient acknowledgement. Even where it is doubtful on which side the balance is to lie, the statement would still to be sufficient acknowledgement for the purpose. In AIR 1944 65 (Lahore) it appears that in the first letter, the debtor made a request to the plaintiffs creditor to send him a complete statement of accounts. In the second letter, the debtor acknowledged receipt of some sorts of account and demanded further particulars. In the third letter, debtor again requested the creditor to send him more particulars of the principal amount and the interest charged thereupon. The last letter said that the debtor wanted the name of each of the creditors from whom the plaintiffs creditor had borrowed money or the debtor with particulars. It was held by the Division Bench of the Lahore High Court that all these letters were clearly acknowledgement within the meaning of Section 19 of the Limitation Act, 1908.

Reference may lastly be made to the two decisions of the Supreme Court in Khan Bahadur Shapoor Fredoom Mazda Vs. Durga Prosad Chamaria and Others, and in Lakshmirattan Cotton Mills Co.Ltd. and Behari Lal Ram Charan Vs. The Aluminium Corporation of India Ltd., which have clearly ruled that the statement on which the plea of acknowledgement is founded need not amount to formal admission of liability and need not indicate the exact nature or the specific character of the liability. It must, however, relate to a present-subsisting liability and indicate the existence of jural relationship between the parties such as, for instance, that of a debtor and of a creditor and the intention to admit such jural relationship. But such intention need not be in any express terms and can always be inferred by implication from the nature of the admission and the surrounding circumstances. It has also been ruled that generally speaking a liberal construction of the statement in question should be given as far as possible.

Applying the principles settled by this impressive array of authorities, we do not entertain any doubt that by these three letters, being Ext. 3, Ext. 3(a) and Ext. 3(b), the West Bengal State Electricity Board clearly admitted, and never denied, the jural relationship of a debtor and creditor and went on assuring the petitioner that his case and claims were being considered. That being so, there can not be any escape from the irresistible conclusion that by these three letters, the opposite party, the West Bengal State Electricity Board has acknowledged liability within the meaning of Section 18 of the Limitation Act. 1963. It has not been disputed at any stage by the learned Counsel appearing for the West Bengal State Electricity Board that if these three letters are held to have amounted to an acknowledgement of liability, the instant suit, giving rise to this proceeding was not barred by limitation. We; therefore, hold accordingly, allow the revision and set aside the judgment of the Full Bench of the Small Causes Court and restore the judgment and decree of the trial Courts We however, make no order as to costs.

Amulya Kumar Nandi, J.

I agree.