The court emphasized that for an agreement under Section 25, Sub-section (3) of the Indian Contract Act to be valid, there must be mutual consent, and the amendment to Section 20 of the Limitation Act cannot revive a barred debt.

Rajamannar, J.

1. The plaintiff whose legal representative is the appellant brought a suit in 1940 on a promissory note dated 20th February, 1933. Admittedly there were payments on the 25th December, 1934, and on the 19th November, 1937, but these are payments which according to the Law of Limitation at the time of (he institution of the suit would not save the suit from being barred. On the 9th August, 1939, the defendant applied to the Debt Conciliation Board for relief and on the 1st June, 1940, he made a statement before the Board undertaking to pay seven creditors of whom the plaintiff was one at the rate of seven annas in the rupee if he was granted four months time from that day. The Advocate for the appellant contended in the Courts below and in this Court that this statement could be utilised to found a claim based on Section 25, Sub-section (3) of the Indian Contract Act. The short answer to this contention is that when the defendant made that offer, four of the seven creditors agreed to the proposal but the plaintiff admittedly did not agree because he was not willing to take seven annas in the rupee in full satisfaction. The four creditors in fact entered an agreement subsequently with the defendant in accordance with the undertaking referred to. After a definite refusal by the plaintiff of the offer by the defendant, it is impossible to understand how a claim under Section 25, Sub-section (3) can be made now in this suit. It is significant that even in the present suit the plaintiff claimed the full amount payable under the promissory note and in second appeal also he has claimed the full amount. No doubt he claims at seven annas in the rupee in the alternative but that does not make a difference in the legal position. Section 25, Sub-section (3) is based on an agreement. The facts mentioned are conclusive to show that there was no agreement. In this view, all the decisions cited by the appellants counsel in Appa Rao v. Suryaprakasa Rao (1899) 9 M.L.J. 330 :I.L.R. 33 Mad. 94, Maniram Seth v. Seth Rupchand (1906) 16 M.L.J. 300 : L.R. 33 IndAp 165 : I.L.R. 33 Cal. 1047 , Ram Bahadur Singh v. Damodar Prasad Singh A.I.R. 1921 Pat. 29, Prasanna Kumar v. Panaulla A.I.R. 1933 Cal. 659 are of no assistance.

2. It was also attempted to be argued that the plaintiff is entitled to rely on Act XVI of 1942, which amended Section 20 of the Limitation Act with the intention of superseding the law as laid down in Rama Shahs case5. This amendment was made long after the institution of the suit and it cannot have the result of reviving what was a barred and unenforceable claim at that time. I agree with respect with the decision of Patanjali Sastri,J., in Avudayammal v. Ambasankar Davay (1944) 1 M.L.J. 347 that where the debt has become barred by limitation long before the amendment took effect, the amendment could not be relied upon to operate retrospectively so as to revive the barred debt. The lower Courts were right in holding that the suit is barred by limitation.

3. The second appeal is dismissed with costs. (Leave refused).