IMPORTANT POINT
An acknowledgment of debt made in writing before the expiration of the limitation period resets the limitation period, as per Section 18 of the Limitation Act.

JUDGMENT :

This regular first appeal has been filed under Section 96 read with Order XLI Rule 1 of the Code of Civil Procedure, 1908.

2. The plaintiff in O.S. No.236 of 2012, on the files of the Sub-Court Mavelikkara, has preferred this appeal, arraying the defendants as the respondents herein, while challenging the decree and judgment dated 30.10.2014 therein.

3. Heard in detail. Perused the verdict under challenge as well as the records of the trial court.

4. For effective and easy discussion, the parties in this appeal will be referred to as ‘plaintiff’ and ‘defendants’ hereafter.

Short facts:-

5. The plaintiff is a Nationalised bank constituted and functioning under the Banking Companies (Acquisition and Transfer of Undertaking) Act 1970 with its head office at Bangalore, having branches at several places, including one in Kayamkulam. The Manager of Kayamkulam branch Sri. Hari. N, who was duly authorized to represent the plaintiff to sign and verify the plaint for and on behalf of the plaintiff, filed the suit. According to the plaintiff, the 1st defendant availed a loan of Rs.2 lakh from the plaintiff on 23.06.2005 to improve her business. The 2nd defendant stood as co-obligant for the loan transaction. On the date of availing the loan the 1st defendant executed an agreement-cum-deed of hypothecation in favour of the plaintiff bank. Similarly, the 2nd defendant executed and delivered a covenant of co-obligation in favour of the plaintiff bank. The 1st defendant had undertaken to repay the loan amount in 35 instalments @ Rs.6,610/- starting from 23.7.2005, but she could not repay the same within the stipulated time. On 24.09.2007, she admitted the liability and executed an acknowledgement of debt, and again on 24.07.2010, she executed another acknowledgement of debt in favour of the plaintiff bank. The 1st defendant failed to repay the amount as agreed, and the plaintiff sent notice to the defendants to repay the entire amount due to the bank. Even after notice, the defendants did not repay the loan amount. As per the statement of accounts pertaining to the loan transaction, an amount of Rs.2,14,572/- together with future interest @ 15.25% was claimed by the plaintiff.

6. Defendants filed written statement raising contentions as follows:-

7. The Suit is not maintainable and is barred by limitation. The defendants signed in blank printed forms. No collateral security was executed by the 2nd defendant as alleged. Defendants had no transaction with the plaintiff. The signatures of the defendants were obtained by the organization of Vyapari Vyavasayi Ekopana Samithi. Plea of non-joinder was raised contending that Vyapari Vyavasayi Ekopana Samithi not arrayed as a party in the suit. The documents relied on by the plaintiff were signed at the time of availing the loan in 2005. The statement of accounts was disputed. The interest claimed also alleged as exorbitant. Thus, the defendants prayed for dismissal of the suit with their cost.

8. On scrutiny of the pleadings as above, the trial court raised necessary issues and tried the case. PWs 1 and 2 were examined, Exts. A1 to A8 and X1 are marked on the side of the plaintiff. No evidence let in by the defendants.

9. On appreciation of evidence, the trial court dismissed the suit, holding that the execution of Exts.A3 and A4 acknowledgements of debt and security dated 24.09.2007 and 24.07.2010, respectively, were not proved by the plaintiff. Accordingly, it was found that the suit, filed on 19.06.2012 in relation to a loan which was availed on 23.06.2005, is barred by limitation. Holding so, the suit itself was dismissed.

10. The learned counsel for the plaintiff, while assailing the trial court verdict, submitted that, even though the loan was availed on 23.06.2005, the debt was acknowledged by the 1st defendant as per Ext.A3 as on 24.09.2007 before expiry of the period of limitation. Thereafter, the debt was again acknowledged on 24.07.2010 as per Ext. A4 within the period of limitation. In s