1974 Supreme(Mad) 206
NATARAJAN
Kapaleeswarar Temple, Mylapore – Appellant
Versus
T. Tirunavukarasu – Respondent
Advocates:
T. R. Srinivasan and Prem Natrajan, for Petitioner.
Judgement Key Points
Question 1?
What is the effect of a fresh contract under Section 25(3) of the Indian Contract Act on limitation for an acknowledged debt?
Question 2?
How does an acknowledgment under Section 18 of the Limitation Act interact with or differ from a Section 25(3) fresh contract in sustaining a claim?
Question 3?
What are the conditions under which a written promise to pay a barred debt constitutes a contract enforceable under Section 25(3)?
- The Fresh Contract under Section 25(3) can be enforceable irrespective of whether the debt acknowledged is within time or barred by limitation (!) (!) .
- Acknowledgment under Section 18 creates a fresh period of limitation from the time of acknowledgment (!) (!) .
- A fresh contract under Section 25(3) may be based on a prior barred debt and can be enforced as the basis of action for recovery of the amount promised (!) (!) .
- The writing must be signed and be a promise to pay wholly or in part a debt which the creditor might have enforced but for the limitation law (!) (!) (!) .
- The contract under Section 25(3) does not require the debt to be alive or within time at the date of the promise; it creates an independent enforceable contract (!) (!) .
- The court reversed lower court decisions, holding Ex. P-1 creates a fresh contract enabling recovery of the total amount (!) (!) .
- The ratio clarifies that Section 18 and Section 25(3) serve different purposes: acknowledgment extends limitation; Section 25(3) creates a new contract beyond limitation (!) (!) .
- Illustrative authorities support that a debt barred by limitation can be the subject of a fresh contract under Section 25(3) to pay the debt (!) (!) .
Question 1?
What is the effect of a fresh contract under Section 25(3) of the Indian Contract Act on limitation for an acknowledged debt?
Question 2?
How does an acknowledgment under Section 18 of the Limitation Act interact with or differ from a Section 25(3) fresh contract in sustaining a claim?
Question 3?
What are the conditions under which a written promise to pay a barred debt constitutes a contract enforceable under Section 25(3)?
ORDER :- The plaintiff in suit No. 3118 of 1969 on the file of the Third Judge, Court of Small Causes, Madras, who was the applicant in N. T. A. No. 82 of 1971 on the file of the Court of Small Causes, Madras, is the revision petitioner. The plaintiff, viz., Sri Kapaleeswarar Temple by Chairman, Board of trustees, filed a suit against the respondent for recovery of a sum of Rs. 324 being the arrears of rent due from the respondent for the period March 1960 to December, 1968 on a monthly rent of Rs. 3/-. The respondent opposed the suit claim and contended that the claim was barred by limitation and secondly that two payments of Rs. 30/- made by him had not been given credit to. In support of his claim the plaintiff placed reliance on a letter Ex. P-1 executed by the respondent on 2-11-1968. The learned trial Judge came to the conclusion that Exhibit P-1 can keep alive the rent claimed by the plaintiff only for a period of three years prior to the date of its execution and in that view he held that the plaintiff was entitled to recover arrears of rent from the respondent only from the month of October, 1965 onwards and rejected the plaintiff's claim for rent for the period prior to O
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