The receipt of rent or produce by a mortgagee in possession of the mortgaged property constitutes an acknowledgment of payment within the meaning of Section 20 of the Limitation Act, 1908, and starts a fresh period of limitation in respect of the debt secured by the mortgage.

Chagla, C.J. :- This is an appeal from a judgment of the Civil Judge, Senior Division Belgaum, by which he decreed the plaintiffs suit on two mortgages to a certain extent and it is the plaintiffs who have come in appeal before us contending that they were entitled to the full claim comprised in their suit.

2. One Veerappa and Gurshiddappa mortgaged to plaintiffs father on 7-2-1917, a shop to secure a debt for Rs. 4,500. The period of the mortgage was fixed at five years and there was a provision for sale of the property in the event of the mortgage amount not being paid within the stipulated period. It was further provided in this mortgage that the mortgagee was to be in possession of the shop, that he was to recover the rent of Rs. 300 of the shop and appropriate it towards the interest fixed on the mortgage. The interest was fixed at 9 per cent. Therefore, in this mortgage there was provision with regard to the payment of interest to the extent of of Rs. 300. That left a balance of Rs. 105 payable by the mortgagor under the mortgage.

On 23-1-1925, another document was executed by the two mortgagors in favour of the plaintiffs father, and by that document the two mortgagors gave an additional charge to the mortgagee in respect of a further advance of Rs. 4000. The document describes the mortgage as a possessory mortgage and it emphasises the fact that the possession of the mortgaged property was already with the mortgagee. The rate of interest is the same as under the earlier document, viz. 9 per cent. The plaintiffs filed the suit to enforce these two mortgages and they claimed in the suit Rs. 4,500 and Rs. 4,000 for principal under the two mortgages, in all Rs. 8,500, and they also claimed interest in the sum of Rs. 8,500 on the principle of dam dupat. There were some other claims with which we are not concerned in this appeal. The learned Judge below held that the plaintiffs were entitled to the principal, viz. Rs. 4,500 under the first mortgage; they were only entitled to interest for 12 years up to the date of the filing of the suit, and that the plaintiffs claim with regard to the second mortgage was out of time and therefore no relief was given by the learned Judge in respect of the second mortgage.

3. Now, as far as the first mortgage is concerned, the question that arises is whether the receipt by the mortgagee of Rs. 300 every year under the mortgage constitutes an acknowledgment within the meaning of S. 20, Limitation Act, so as to start a fresh period of limitation in respect of the debt secured by the mortgage. Section 20 deals with the effect of payment on account of a debt, to the extent that section in material for the purpose of this appeal, and it contains a proviso that the acknowledgment of the payment must appear in the handwriting of, or in a writing signed by, the person making the payment. Therefore, a mere part payment of the debt would not save limitation. The proviso further requires that the fact of the payment must appear in the handwriting or in a writing signed by the person making the payment. Provided these two conditions are satisfied then a fresh period of limitation would start under Section 20.

Now, there is another sub-clause to this section which provides that when mortgaged land is in possession of the mortgagee the receipt of the rent or produce of such land shall be deemed to be a payment for the purpose of sub-s. (1). Now, in our opinion, the expression "where mortgaged land is in the possession of the mortgagee" does not merely apply to cases where the mortgagee is in possession under a usufructuary mortgage; it applies to all eases where the mortgagee is in possession in his capacity as the mortgagee and under the terms of the mortgage. One may easily conceive of a case where in a simple mortgage there may be a provision that on default of payment of interest the mortgagee would be entitled to go into possession. Therefore, if the mortgagee went into possession under a simple