An account is not a mutual, open and current account within the meaning of Article 1 of the Limitation Act unless there are transactions on each side creating independent obligations on the other.

( 1 ) THE short but important question that arises in this Civil Revision Petition is, whether the account of the defendant in the books of the plaintiff giving rise to the suit claim, is a mutual, open and current account. It is conceded by both the parties that if the account is a mutual, open and current account, then, the suit is not barred by time under Art. 1 of the I Schedule to the Limitation Act ; but, if it is not a mutual open and current account within the meaning of the Article, then, the suit claim is barred by time.

( 2 ) THE material facts giving rise to the above Civil Revision Petition may briefly stated. The respondent-plaintiff filed a suit against the petitioner-defendant for the recovery of an amount of Rs. 636-07 Ps. On Khata dealings. In the plaint the respondent averred that the defendant had opened a khata in his favour in the plaintiffs firm made payments to his credit and took goods when ever necessary. As per the statement of account filed the defendant owed the plaintiff a sum of Rs. 636. 07 ps it was an open mutual and current account, because there were suit Khata dealings between the plaintiff and the defendant, creating reciprocal demands against each other.

( 3 ) THE petitioner-defendant resisted the suit. According to him, the account was not a mutual, open and current account. The transactions on either side were not independent of each other creating independent obligations. The transaction on one side created obligations and those on the other side, were either complete or partial discharges of such obligations, or payments towards the value of the goods to be supplied immediately in the near future. The defendant made payments towards the costs of goods supplied or to be supplied, but never as separate transactions. Article 1 of the first schedule to the Limitation Act did not apply to the account and hence the suit was barred by Limitation. The defendant also denied the last credit entry for Rs. 150. 00- dated 13/07/1964.

( 4 ) ON the basis of these plaintiffs, the Subordinate Judge of Machilipatnem framed the following point for consideration :--" Whether the plaintiff is entitled to recover the suit amount from the defendant. "

( 5 ) THE plaintiffs Accountant was examined in support of the plaintiffs case and the defendant examined himself in support of his version. On the basis of that evidence, the learned Subordinate Judge observed that the defendant failed to produce his account-books or the receipts obtained by him from the plaintiff to prove his contention that the defendants which he had with the plaintiffs company were not mutual, open and current account as independent transactions, and as such, an adverse inference has to be drawn against him. With those observations, the learned Subordinate Judge held that the suit account was a mutual, open and current account and the suit amount based on it was not barred by limitation, and accordingly decreed the suit to the extent of Rs. 467-70 Ps. With proportionate costs.

( 6 ) AGGRIEVED by the above decree, the defendant has filed this Civil Revision Petition. The only contention raised before me is that, the suit account was not a mutual, open and current account and no independent obligations were created. The defendant paid the amounts to the plaintiff for the fertilisers supplied or to be supplied by the plaintiff. No independent obligations arose against each other and, hence, the account was not a mutual, open and current account. In support of that contention, the learned Counsel relied upon the decision of the Supreme Court in Hindustan Forest Company v. Lal Chand, AIR 1959 SC 1349.

( 7 ) THE learned Counsel for the plaintiff-decree-holder, on the other hand , contended that the defendant paid moneys and there was no obligation on the part of the plaintiff to supply fertilisers. The plaintiff, to that extent, was under a liability to pay back the money to the defendant. The defendant had to pay the costs of the