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2025 Supreme(Online)(SC) 6872
SUPREME COURT OF INDIA
SANJAY KUMAR, SATISH CHANDRA SHARMA, JJ
M/S. AIREN AND ASSOCIATES – Appellant
Versus
M/S. SANMAR ENGINEERING SERVICES LIMITED – Respondent
CIVIL APPEAL NO. 654/2015
For the Appellants/Petitioners: Mr. Atul Shanker Mathur, Mr. Sarvapriya Makkar, Ms. Ghanistha Mishra
For the Respondents: Mr. K.V. Mohan, Mr. K.V. Balakrishnan, Mr. Devesh Khanduri
An acknowledgment must explicitly relate to the total liability for the extended limitation period to apply; partial acknowledgment does not suffice.
Headnote:(A) Limitation Act, 1963 - Section 18 - Acknowledgment of liability - Issue of whether acknowledgment from the respondent in legal notice constituted valid acknowledgment for entire claim - Acknowledgment must be specific to claim or liability for extended limitation period to apply (Paras 9-10)
(B) Legal principles - An acknowledgment must specifically relate to the full amount for limitation to extend; partial acknowledgment does not avail for total claim (Para 12)
Facts of the case:
Appellant filed for recovery based on a claimed contract worth ₹3,07,115.85 but limited by acknowledgment for ₹27,874.10 found adequate by the High Court.
Findings of Court:
The court ruled that the acknowledgment by the respondent did not extend the limitation for the total claim, only for the acknowledged amount.
Issues: The primary issue was whether the respondent's acknowledgment sufficed to extend the limitation period for the entire suit claim.
Ratio Decidendi: The court held that mere acknowledgment of part of a claim does not extend the limitation period for additional claims; it must be for the full claim.
Result: Appeal dismissed.
O R D E R
The issue for consideration in this appeal is whether the appellant, M/s. Airen and Associates, would be entitled to the benefit of extended period of limitation under Section 18 of the Limitation Act, 19631, for its entire suit claim.
The appellant undertook certain work for the respondent and claimed to have completed it on 07.02.1991. It then addressed notice dated 14.03.1992 to the respondent, raising a claim for ₹3,07,115.85 (Rupees three lakhs seven thousand one hundred fifteen and eighty five paisa only). The respondent issued reply dated 21.05.1992 through an Advocate, stating that the contract value of the work itself was ₹1,55,223/- (Rupees one lakh fifty five thousand two hundred twenty three only) and that a sum of ₹1,00,000/- (Rupees one lakh only) had already been paid to the appellant after certain deductions. The respondent, however, acknowledged that a sum of ₹27,874.10 (Rupees twenty seven thousand Signature Not Verified Digitally signed by D De ae tep :a e2k 0 G 2i5u .g 0gl 7a .n 2i 5ht hundred seventy four and ten paisa only) still remained due
17:27:02 IST Reason:
and payable to the appellant in full and final settlement of the
1 “Act of 1963”, for short contract price and stated its willingness to pay the said amount, without prejudice.
The appellant thereafter filed Civil Suit No. 21-B/1995 on
17.04.1995 before the learned District Judge, Durg, Chhattisgarh, for recovery of the sum of ₹3,07,115.85 (Rupees three lakhs seven thousand one hundred fifteen and eighty five paisa only) along with interest thereon at the rate of 18% per annum from 01.04.1991, aggregating to ₹5,28,238.89 (Rupees five lakhs twenty eight thousand two hundred thirty eight and eighty nine paisa only). This suit was dismissed, vide judgment and decree dated 08.12.2003. The learned District Judge held therein that the appellant was entitled to receive the sum of ₹3,07,115.85 (Rupees three lakhs seven thousand one hundred fifteen and eighty five paisa only) along with interest thereon, but non-suited it on the ground that its suit was barred by limitation.
Aggrieved thereby, the appellant filed First Appeal No.
34/2004 before the High Court of Chhattisgarh at Bilaspur. By the impugned judgment dated 12.06.2012, the High Court held in favour of the appellant insofar as the issue of limitation is concerned, by extending to it the benefit of Section 18 of the Act of 1963, but holding to the effect that, in terms of the acknowledgment given by the respondent, the appellant would be entitled to recovery of only the acknowledged sum of ₹27,874.10 (Rupees twenty seven thousand eight hundred seventy four and ten paisa only) along with interest thereon at the rate of 12% per annum from 01.04.1991 till the date of actual payment.
Aggrieved by such reduction of its claimed amount, the appellant is before this Court.
The facts having been set out hereinabove, the short point for consideration is whether the acknowledgment given by the respondent, under its legal notice dated 21.05.1992, would amount to an acknowledgment that would attract the extended period of limitation under Section 18 of the Act of 1963 for the entire suit claim. Section 18 of the Act of 1963 reads as follows: -
“18. Effect of acknowledgment in writing.—(1) Where, before the expiration of the prescribed period for a suit or application in respect of any property or right, an acknowledgment of liability in respect of such property or right has been made in writing signed by the party against whom such property or right is claimed, or by any person through whom he derives his title or liability, a fresh period of limitation shall be computed from the time when the acknowledgment was so signed.
(2) Where the writing containing the acknowledgment is undated, oral evidence may be given of the time when it was signed; but subject to the provisions of the Indian Evidence Act, 1872 (1 of 1872), oral evidence of its contents shall not be received.
Explanation.—For the purposes of th
