Requirement of burden of proof.

This is a defendant’s Second Appeal arising out of a suit for recovery of a sum of Rs. 600 alleged to be due from him to the Commercial Funds, Ltd., Kancheepuram. The defendant was a subscriber to a chit conducted by the Funds. He took in auction a chit for Rs. 5,000 payable in 100 monthly instalments of Rs. 50 each . The first instalment was due on March 14, 1947, and the last was payable on May 14, 1951. Admittedly, the defendant paid all the instalments due up to September 14, 1949; but he failed to pay the subsequent instalments. The Funds were directed by this Court in O.P. No. 309 of 1949 to be wound up. The Official Receiver who was appointed as the Official Liquidator for realizing the outstandings of the Funds, sold the outstandings due to the Funds, to the plaintiff, the respondent in the present Second Appeal, by means of a sale deed dated May 17, 1954. The plaintiff, as such assignee, claimed to be entitled to realize the amount claimed in the suit. According to him, although he was entitled to a larger amount, he confined his claim to the sum of Rs. 600 being the instalments payable for the period from 14th December 1950 to 14th May, 1951. The suit was actually instituted on 1st July, 1955. The plaintiff pleaded that the suit was in time by virtue of Madras Ordinance V of 1953 and Madras Acts V of 1954 and I of 1955.

On appeal by the plaintiff, the lower appellate Court took a different view on the question of limitation. In effect, it considered that waiver on the part of the plaintiff would, in such circumstances, be presumed, and that the suit would, therefore, be in time, under Article 75 of the Limitation Act. In support of this view the lower appellate Court relied on the decision of Mack, J., in Ayyadurai Mudaliar v. Ibramsa Rowther1, allowed the appeal and decreed the suit. The aggrieved defendant has, therefore, come up to this Court in Second Appeal.

The main point urged by Sri K.S. Champakesa Ayyangar, the learned counsel for the appellant, is that the lower appellate Court was in error in supposing that waiver for purposes of the third column in Article 75 could be presumed in favour of the plaintiff. His contention is that the plaintiff, if he wanted to rely on it, must clearly plead waiver for purposes of the third column of that Article and prove the same just like any other fact by cogent evidence. His contention further is that the mere fact, that waiver might be to the benefit of the plaintiff, is not sufficient justification for the view that waiver can be presumed in favour of the plaintiff and that the defendant should prove that there is no waiver. I think the learned counsel is right in his contention. Article 75 of the Limitation Act governs a suit, inter alia, on a bond payable by instalments, which provides, that, if default be made in payment of one or more instalments, the whole shall be due. The period prescribed for such a suit is three years. The starting point as provided in column 3 is stated thus:

“When the default is made, unless where the payee or the obligee waives the benefit of the provision and then when a fresh default is made in respect of which there is no such waiver.”

It is clear from this that the period of limitation commences the moment there is a default made in payment of the instalment due. A suit beyond three years from the date of such default would prima facie be out of time. It would be within time only if the plaintiff has waived the benefit of the default provision. Whether there is a waiver or not is a question of fact. Obviously it will have to be pleaded and established, if it is to be relied upon as a ground for the exemption from the bar of limitation provided by Article 75. The mere fact that waiver will be to the advantage of the plaintiff inasmuch as that will save him from the bar of limitation, will not ipso facto be a proper basis for the view that he should be assumed to have waived the benefit and that on that basis the defendant, who plead