Velayudha Naicker vs Annamalai Chetty and Others

Chandrasekhara Ayyar, J.—The only point that arises in this second appeal is a question of limitation and the relevant dates are given at

page 5 of the judgment of the first Court. The finding of the Subordinate Judge that the schedule which was filed on 13th July, 1936, gives a fresh

starting point of limitation as there is an acknowledgment of liability in respect of the suit promissory note, has not been challenged. The only point

which was argued before him was that this schedule did not amount to an acknowledgment of liability. No other point was raised or pressed

before him. However, it is open to the appellant to put forward a pure question of law here and what Mr. Ramachandra Rao has urged now is that

the suit which was filed on 17th February, 1941, was out of time as it is not within three years from the date of the acknowledgment of liability in

the schedule, viz., 13th July, 1936. He contends that the plaintiff is not entitled to ask that the period from the date of the schedule to the date of

the annulment should also be excluded in his favour.

Section 78, Sub-clause (2) of the Provincial Insolvency Act provides that, where an order of adjudication has been annulled under the Act, for

computing the period of limitation prescribed for any suit which might have been brought but for the order of adjudication, the period from the date

of the order of adjudication to the date of the order of annulment shall be excluded. The plaintiff could have filed his suit within 13th July, 1939, it is

conceded. In computing the three years'' period of limitation which the plaintiff gets u/s 19, Sub-clause (1) by reason of the acknowledgment in the

schedule, we have to exclude the period during which the defendant was an insolvent and when no suit could have been filed against him because

the order of adjudication was in force. If we exclude this period (from 13th July,'' 1936, to 19th August, 1938) and give the plaintiff the three years

which the Limitation Act gives him, the suit is within time. There is nothing in Section 78 which precludes us from taking this view and which

compels our holding that if the acknowledgment was during insolvency the three, years given to the plaintiff-creditor must be taken to be from the

date of the acknowledgment itself exclusive of the benefit that he will get under Sub-clause (2). The second appeal is dismissed with costs. (No

leave).