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KERALA HIGH COURT
Harun-Ul-Rashid, J.
Sajan Varghese —Appellant
versus
Kerala State Electronic Development Corporation Ltd. —Respondent
A.S. No. 277 of 2000
Decided on 12.1.2010
(ii) Limitation Act, 1963—Section 19 read with Article 14—Money suit—Exemption from limitation—In instant case, pleadings are incomplete—Pleadings only state that defendant has acknowledged debt by making part payment—Pleadings does not contain averments that such payment had been acknowledged in writing or acknowledgment of payment appears in hand writing signed by person making payment—Plaintiff did not produce proof in support of acknowledgment—Instant case is a simple suit for recovery of balance amount due towards price of goods supplied by plaintiff to defendant and is not a suit for accounts—As such, article applicable is Article 14—Proceedings of suit continued in appeal till date for last more than 14 years—Since plaintiff failed to take any steps to summon cheque issued by defendant in order to claim exemption under Section 19 suit has to fail—Impugned judgment and decree set aside—Money suit dismissed. (Paras 15 and 16)
AIR (38) 1951 SC 477; 1958 KLT7(X); ILR 1981 (1) Ker. 420; 1996 AIHC 4163—Relied on.
Result: Appeal allowed.
Harun-Ul-Rashid, J.—The defendant in O.S.No.142 of 1994 on the file of the Principal Sub Court, Thiruvananthapuram is the appellant. The appeal is directed against the judgment and decree dated 30.06.1999. The plaintiff Kerala State Electronic Development Corporation Ltd., filed the suit for recovery of Rs. 87.364/- together with interest at 20% due from the defendant. The court below decreed the suit allowing the plaintiff to recover the sum of Rs. 87,364/- with interest at 12%. Aggrieved by the decree and judgment, the defendant had preferred this appeal. Parties hereinafter referred to as plaintiff and defendant.
2. The suit is for recovery of the price of the goods purchased by the defendant. The defendant had purchased 50 colour T.V. Sets from the plaintiff as per invoice Nos. 102189-102194 dated 27.12.1989. The defendant had availed credit purchase facility for Rs. 5,24.475/-. The defendant also purchased one stereo tape recorder for Rs. 1,725/- and a Black and While T.V. Set worth Rs. 2,300. It is pleaded that the defendant has been making part payment on various dates till 26.2.1992. The suit was filed for the outstanding balance.
3. The suit is mainly contested on the question of bar of limitation.
4. Admittedly, the defendant purchased T.V. Sets as per six invoices. Ext A.1 series are the invoices. It is admitted that after the purchase, the defendant had been making the payments towards the price of the articles sold. According to the defendant the last cheque payment was made on 15.3.1991. Hence the suit claim is barred by limitation and therefore not enforceable.
5. In Paragraph 11 of the plaint it is averred that the defendant has acknowledged the liability by the part payment on various dates and last such payment was made on 26.2.1992 by remitting Rs. 10.000. There is no doubt that the plaint was proceeded on the premise that the suit was barred by limitation but for part payment made on 26.2.1992.
6. The plaintiff produced Exts.A2, A3 and A4, true copies of ledger papers maintained by the plaintiff in the name of the defendant. The part payment made by the defendant is credited to in the accounts. The Trial Court applied Art.1 of the Limitation Act. 1963. Art. 1 reads as follows:
7. The court below examined the nature of the transaction and took the view that the transaction is mutual, open and current account. To consider the transaction as mutual open and current account, where they have been reciprocal demand between the parties, the trial court held that the account maintained by the plaintiff is a running account of which the limitation starts from the close of the year in which the last item admitted or proved. The account shows that the defendant was issuing cheques as well as making cash payments on various dates during the period between December 1989 to February, 1992. The trial court also noted that the last payment was on 26.2.1992. The learned Judge held that the account is carried over from 1989 to 1992, therefore the account is current, open and mutual. The Trial Court observed that if the plaintiff can recover the money based on the dishonoured cheque, it is still open for him to recover the balance price of the delivered goods. According to the court below the suit is perfectly maintainable and is filed within the period of limitation and the same falls under Art. 1 of the Limitation Act.
8. The learned counsel for the appellant/defendant contented before this court that Art. 14 is squarely applicable in this case and that Art. 1 cannot have any application. The scope of Art, 1 of the Limitation Act and its distinguishing characteristics are examined by a Division Bench of this Court in Union Bank Ltd, v. N. Raghavan Nair. 1958 KLT 706 This court held that the distinguishing characteristics of a mutual account are (1) that there should be two sets of independent transactions between the parties one of which one of the parties should hold the position of debtor and the other that of cre
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