Payment via dishonoured cheque does not restart the limitation period for debt recovery under Section 20 of the Limitation Act.

1. This is a revision under S.115, C.P.C. by S. Dharam Singh, defendant, against the order dated 11-9-1962 of the District Judge of Saharanpur, allowing the revision under S.25 of the Provincial Small Cause Courts Act and thereby setting aside the judgment and decree of the Judge, Small Cause Court, and decreeing the suit of Khan Chand, plaintiff, in full.

2. The material facts of the case are that on 4-11-1957 the defendant - applicant borrowed a sum of Rs. 400/- from the plaintiff - opposite party, and on 30-9-1958 he (defendant) issued a cheque for the above amount in payment of the loan. The cheque was dishonoured under the note dated 28-11-1958 of the United Commercial Bank Ltd., Delhi. The plaintiff instituted the present suit on 27-9-1961 basing his claim on the loan though pleading that he was entitled to the benefit of S.20 of the Limitation Act, 1908 (to be referred hereinafter as the Act), in view of the fact that payment had been made by cheque, though dishonoured. In fact, benefit was also claimed of S.19 of the Act, but this part of the plea was later rightly given up.

3. S. Dharam Singh, defendant, raised various pleas, but they were repelled by the trial Judge, and for purpose of this revision, it is not necessary to reproduce such pleas in this order.

4. The Judge, Small Cause Court, was of opinion that the plaintiff was not entitled to the benefit of S.19 and S.20 of the Act and that the suit was barred by limitation. He, therefore, dismissed the suit with costs on parties. The plaintiff then went up in revision under S.25 of the Provincial Small Cause Courts Act and the District Judge took the view that the period of limitation stood extended by the cheque issued on 30-9-1958. He thus recorded the finding that the suit was filed within time, and consequently decreed the suit in full. The present revision is against this order of the District Judge and, naturally, the point raised is that the plaintiffs' suit was barred by limitation.

5. The main point for consideration is whether the plaintiff was entitled to the benefit of S.20 of the Act by virtue of the debtor (defendant) having issued a cheque on 30-9-1958, though that cheque was later dishonoured. In case the finding is recorded against the plaintiff, it shall have to be considered whether any alternative relief could be granted to him. In such a case, thin Court shall have to consider whether to pass a final order in the revision or to remand the suit for a fresh hearing so that the defendant may not be taken by surprise and may not, in any manner, be prejudiced.

6. S.20(1) of the Act provides that where payment on account of a debt is made before the expiration of the prescribed period by the person liable to pay the debt, or by his duly authorised agent, a fresh period of limitation shall be computed from the time when the payment was made. The proviso to this Subsection further lays down that the acknowledgment of the payment should appear to be in the handwriting of, or in a writing signed by, the person making the payment. In case the cheque in question had been honoured, there could be no two opinions on the matter in controversy. Payment by cheque is now common, in fact, has become a rule adopted by the public for many reasons. By making payment by cheque, the necessity of carrying huge sums of money is avoided, and the payer has a document in his possession to prove the payment in case the payee does not give a receipt, or the receipt sent is lost. Payment by cheque is now so common that whenever a cheque is honoured, it can be held without any hesitation that payment has been made.

7. Controversy arises wher