The main legal point established in the judgment is the application of principles from the Limitation Act and relevant case laws to determine the period of limitation for a suit for recovery of money lent.

1. This petition filed u/S. 115 of the Code of Civil Procedure, 1908 (for brevity, the Code), is directed against the order dated June 7, 1991 passed by the Sub-Judge Ist Class, Chandigarh, holding that the suit filed by the plaintiff-respondent against the defendant-petitioners is within the period of limitation after treating the issue with regard to limitation as a preliminary issue.

2. The facts of the case in brief are that the plaintiff-respondent filed a Civil Suit No. 409 on August 10, 1990, seeking recovery of Rs. 32,399.30 as principal sum including interest calculated up to February 28, 1989. The plaintiff-respondent alleged that the defendant-petitioners obtained facility of overdraft by pledging FDR worth Rs. 20,000/- and on January 4, 1984 a loan of Rs. 15,000/- was given to the defendant-petitioners by the plaintiff-respondent. Defendant-petitioners became irregular in making repayment of overdraft amount. The plaintiff-respondent issued several notices duly acknowledged by the defendant- petitioners. They continued making payment of overdraft amount from time to time, but thereafter, the defendant-petitioners failed to liquidate their overdraft loan amount. A legal notice was issued on April 26, 1988 but the defendant-petitioners did not make payment of the balance amount of overdraft.

3. The suit was contested by the defendant-petitioners by raising, inter alia, an objection that the suit was barred by limitation and it was alleged that the plaintiff- respondent was unnecessarily blocking the FDR payment to the defendant-petitioners. The Civil Judge, treated the issue of limitation as preliminary issue and held the same in favour of the plaintiff-respondent. Operative part of the order passed by the learned Sub-Judge, Chandigarh, reads as under :

"In order to establish this please, learned counsel for the defendant was supposed to bring the factual and legal date but no evidence has been led on his behalf and his argument is that as per case of the plaintiff- Bank, the overdraft limitation was sanctioned on 4-1-1984 and legal notice was issued on 25-4-1988 and Limitation Act, 1963 (Act No. 36 of 1963) on the other hand, the contention of Shri V. K. Vashisht learned counsel for the plaintiff-Bank is that it is not a case of ordinary money suit falling within the ambit of Article 19 but the intention of the parties in this suit, is that overdraft facilities was allowed to the defendants who pledged FDR and money was payable with interest upon money and as per statement of Account Ex. PX, the limitation will start from 31-3-1987 when the balance was struck and in such circumstances, the Article 25 of the Limitation Act applicable with reads as under : The comparative assessment of the contentions advanced from both sides is clear from the fact brought into light by Statement of Account Ex. PX that amount of Rs. 300.00 is shown towards credit, in the year 1987. So the amount was being prepaid by the" defendants up to 1987 and limitation is to be computed from the conclusion of the Financial Year of 1987 i.e. 31-3-1987 as the intention of the parties in this case is that the money is payable for interest upon money due from the defendant to the plaintiff and Article 25 reproduced above is found applicable in this and interest becomes due on 31-3-1987 on which the principle (sic) is dependent. So the limitation is to be computed from 31 -3-1987. Even, otherwise, the careful perusal of the transaction of overdraft facilities in this goes to show that defendant pledged FDR worth Rs. 20,000. This pledging amounts to mortgaging a valuable-security and in case of such a mortgage, the limitation is even more than three years which runs up to 12 years, which is so in case of mortgage property and in this case the pleading appears to be best mortgage. So the law of limitation is to be interpreted accordingly within this factual material and the facts shown in statement of Account Ex. PX are found not controverted as