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IN THE HIGH COURT OF DELHI
Rajiv Sahai Endlaw, J.
Balbir Rajput - Appellant
Versus
R.P. Exports - Respondent
CS(COMM) 171 of 2018
Decided On : 06-03-2020
The email communication did not constitute a valid acknowledgment of liability under Section 18 of the Limitation Act, leading to the dismissal of the suit as time-barred.
Headnote:(A) Limitation Act, 1963 - Section 18 - Acknowledgment of liability - Plaintiff sought recovery of loan amounting to Rs.1,99,12,000/- from defendants. Court found no acknowledgment of liability in the email relied upon by plaintiff, thus ruling the suit barred by time. (Paras 7-20)
(B) Plaintiff's suit for the recovery of amount lent - Suit dismissed as the claim was barred by limitation and no evidence of acknowledgment of liability was presented. (Paras 18-20)
Facts of the case:
Plaintiff entered into an agreement with defendants for the purchase of factory, later sought to recover advance payments made as loans. Defendants claimed inability to repay the loan, but court found acknowledgment insufficient.
Findings of Court:
No acknowledgment of liability found in communication from defendants, ruling led to the conclusion that the suit was time-barred.
Issues: Whether the email constituted an acknowledgment of liability under Section 18 of the Limitation Act.
Ratio Decidendi: Acknowledgment must indicate a conscious recognition of liability; refusal to pay does not satisfy criteria for acknowledgment as defined in law.
Result: Suit dismissed.
| Table of Content |
|---|
| 1. plaintiff's claim for recovery initiated. (Para 1) |
| 2. process of filing written statement and timeline recorded. (Para 2 , 3 , 4) |
| 3. details of the agreement and payments documented. (Para 5) |
| 4. suit's timeline and claim acknowledged; referral of limitation argument. (Para 6 , 8) |
| 5. counsel argues for clause in limitation act acknowledgment. (Para 7) |
| 6. examination of loan documents and independent transactions. (Para 9 , 11) |
| 7. acknowledgment of liability analyzed; no admissible admission found. (Para 12 , 13) |
| 8. court's interpretation favors existence of liability acknowledgment. (Para 14 , 15) |
| 9. defendants' denial of liability noted; no acknowledgment found. (Para 16 , 17) |
| 10. decision on timeliness of claim; suit dismissed. (Para 18 , 19 , 20) |
JUDGMENT
1. The plaintiff has instituted this suit for recovery of Rs.1,99,12,000/- jointly and severally from defendant No.1 R.P. Exports and its partners defendant No.2 Rekha Kushwaha and defendant No.3 Jatan Kumar.
2. The suit came up first before this Court on 5th February, 2018, when summons thereof were ordered to be issued and in response whereto, the defendants appeared through counsel. The order dated 13th November, 2018 records that written statement had been filed by the defendants; the written statement was not filed within the prescribed time; though the counsel for the defendants stated that an application for condonation of delay had been filed but the said application was not on record. The order dated 14th January, 2019 records the statement of the counsel for the plaintiff that since the delay in filing the written statement was of 20 days only, the same be condoned subject to payment of costs. Vide the same order dated 14th January, 2019, the delay in filing written statement was condoned subject to payment of Rs.5,000/- to the plaintiff.
3. The costs was not paid inspite of repeated opportunities as recorded in orders dated 28th February, 2019, 15th April, 2019 and 23rd July, 2019 and ultimately vide order dated 11th October, 2019, the written statement which was permitted to be taken on record subject to payment of costs, was said to be not on record and not entitled to be considered.
4. On 11th October, 2019, after holding the written statement to be not on record, the plaint was perused to consider, whether the plaintiff was entitled to a decree forthwith.
5. It is the case of the plaintiff in the plaint, (i) that on 2nd April, 2012, an Agreement to Sell and Purchase dated 2nd April, 2012 was executed by the plaintiff on the one hand and the defendants on the other hand, whereunder the defendants agreed to sell their factory admeasuring 1000 sq. mtrs. situated at B-70, Sector-80, Phase-II, Noida (U.P.) to the plaintiff for a total consideration of Rs.2,28,50,000/-, with the transaction to be completed by 1st June, 2012; (ii) that in the last week of May, 2012, the defendant No.3 Jatan Kumar requested the plaintiff to extend the date of performance till 31st December, 2012 and to which the plaintiff agreed; (iii) that in December, 2012 when the plaintiff approached the defendants for completion of the transaction, the defendant No.3 Jatan Kumar informed the plaintiff that the defendants were not willing to sell the factory as they had received big orders/assignment and chance of revival of their business had become bright; the defendants requested the plaintiff that the earlier payment advanced by the plaintiff be considered as a loan with interest @ 2% per month; though the defendants promised to enter into a separate agreement with the plaintiff with regard thereto, and also assured that the entire amount with interest would be refunded within three to four months, but no separate agreement was executed by the defendants and the defendants did not refund the monies received from the plaintiff; (iv) that the plaintiff, from time to time, either himself or through his close friend Chandra Mohan Bhandu, who is also the owner/chairman/MD of Asi
