IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA RFA No. 356 of 2004. Date of decision: 10.9.2009 M/s.Jay Aar Builders Pvt. Ltd. …. Appellant Versus M/s.Ruchira Papers Ltd. ….. Respondent Coram: The Hon’ble Mr. Justice Deepak Gupta, J. Whether approved for reporting ? No For the appellant: M/s.Ankush Dass Sood and Shweta Julka, Advocates. For the respondent: Sh.K.D.Sood, Advocate. _____________________________________________________ Deepak Gupta, J.(Oral) This appeal by M/s.Jay Aar Builders (hereinafter referred to as the plaintiff) is directed against the judgment of the learned District Judge, Sirmaur at Nahan delivered in Civil Suit No.3-CS/1 of 2003 decided on 13.7.2004 whereby he held that the claim of the plaintiff was time barred except for a sum of Rs.62,892/-. Briefly stated the facts of the case are that the defendant entered into an agreement with the plaintiff whereby the plaintiff was awarded the contract for the construction of the building of the defendant-company. The terms of the contract which are relevant for our purpose read as follows:- 2 “3. Payment shall be made monthly. 4. Final bill shall be paid within 90 days after completion of the work.” The plaintiff filed a suit for recovery of Rs.6,02,963.30 paise against the defendant. Out of this, a sum of Rs.4,58,527.30 paise was claimed as the amount due on account of the work done by the plaintiff and a sum of Rs.1,44,436/- on account of interest calculated at the rate of 21 per cent per annum. It would be appropriate to refer to Paras 4 to 6 of the plaint which read as follows:- “4. That the plaintiff raised monthly bills regularly for the work done by it but the defendants used to make the part payments on running account basis to the plaintiff company for the work done with the result the plaintiff company was forced to stop the work due to non payments on part of the defendant, as it was labour rate contract. The photocopies of the Bills are annexed as P-4 to P-6. 5. That on 8.3.1999, a sum of Rs.4,58,527.30 paisa was due against the defendant for which the plaintiff had asked the defendant for its payment vide letter dated 27.5.2000 but the defendant had admitted its liability of Rs.62,892/- vide letter dated 2.6.2000. The photocopies of the letters are annexed as P-7 and P-8. 6. That the plaintiff had then asked the defendants to supply it with the statement of accounts vide letter dated 7.7.2000 and reminder dated 18.7.2000 and requested the defendant for lifting the shuttering material and T&P at site, but all in vain” In para 8 relating to the cause of action, the plaintiff stated as follows:- 3 “That the cause of action has arisen to file the present suit against the defendant for the first time on 8.3.1999 when the plaintiff had submitted the bills; and thereafter on day to day basis and finally on 16.8.2000 when the defendant had admitted its liability of Rs.62,892/- and hence the suit is within a period of limitation. The defendant in the written statement denied the contents of para 8. Admittedly no issue of limitation was framed. However, it appears that during the course of arguments, the issue of limitation was raised. From the perusal of judgment, it is apparent that the counsel for the plaintiff as well as the counsel for the defendant were heard on the issue of limitation. The Learned Court below held that the cause of action arose in favour of the plaintiff on 8.3.1999 as alleged by the plaintiff itself and that the acknowledgment dated 2.6.2000 Ex.PW-2/D only extended the limitation qua the amount acknowledged in the said communication and not in respect of the entire amount. The Learned Court below, therefore, held that rest of the claim was time barred and rejected the claim of the plaintiff to that extent. Decree for Rs.62,892/- only was passed. Hence the present appeal. 4 I have heard Sh.Ankush Dass Sood, learned counsel for the appellant and Sh.K.D.Sood, learned counsel for the respondent. Sh.Ankush Dass Sood contends that in the present case the suit would not be governed by Article 18 of the Limitation Act and it would be governed either by Article 26 or by residuary Article 113. His contention is that this is a suit for accounts and limitation will start from the day when the defendant signs the accounts. In the alternative, he submitted that if it is a suit governed by the residuary Article and according to him the right to sue will accrue only when the repudiation was made by the defendant. I am unable to accept the argument of Sh.Ankush Dass Sood. The main argument of Sh.Ankush Dass is that for the first time the defendant repudiated the accounts of the plaintiff and admitted the amount of Rs.62,892/- only on 2.6.2000 and, therefore, according to him the right to sue would accrue on the said date and limitation would start running from the said date. Article 18 may not be applicable since time to make payment was fixed in the agreement as is apparent from the clauses referred to above. However, I am of the 5 considered view that whether Article 26 or Article 113 is applicable the right to sue accrued not on 20.6.2000 but on 8.3.1999 when admittedly according to the plaintiff as per its accounts a sum of Rs.4,58,527.30 were due to it. Clause 3 of the terms and conditions of the contract quoted here-in-above clearly stated that payment shall be made monthly. If this portion of the clause is taken into consideration then if payment was not made on month to month basis, right to sue accrued to the plaintiff to sue at the end of every month when payment was not made. Clause 4 provides that the final bill shall be paid within 90 days after the completion of the work. This clause would not be attracted since even according to the plaintiff, the work was never completed. In paras 4 and 5 quoted above, the plaintiff has clearly stated that he raised monthly bills regularly for the work done by it but only part payment was made in the running account and the plaintiff was stopped the work due to non-payment of the amount. In Para 5, it was clearly averred that on 8.3.1999 a sum of Rs.4,58,527.30 paisa was due to the plaintiff from the defendant. In this case, the plaintiff has stopped the work due to non-payment of his monthly bills 6 which bills admittedly were not paid prior to 8.3.1999. The plaintiff drew up his accounts on 8.3.1999 when as per it, a sum of Rs.4,58,527.30 paisa was due to it from the defendant. The right to sue accrued to it on the said date. The contention of Sh.Ankush Dass is that the right to sue would accrue from 2.6.2000 when the defendant acknowledged its liability for a sum of Rs.62,892/- only and by implication repudiated its liability for the remaining amount cannot be accepted. If this argument is accepted then the plaintiff may not send the accounts for years on end and only after the accounts are sent then the limitation would start. This is not the purpose of either Article 26 or Article 113. In my considered opinion, even Article 26 may not be applicable because Article 26 pre-supposes that the accounts are stated in writing and signed by the defendant or on his behalf. In the present case, no accounts have been produced which were signed by the defendant. At best it appears that it would be residuary Article 113 which would apply in the case. This Article 113 lays down the limitation of three years and the started point of limitation is the date on which the right to sue 7 accrues. In my considered opinion, the right to sue accrued on 8.3.1999 when the plaintiff ascertained that an amount of Rs.4,58,527.30 paise was due to it from the defendant. Nothing prevented it from filing a suit immediately thereafter or sending a notice immediately on 8.3.1999. Once the limitation starts running it does not stop. Therefore, the limitation for filing the suit expired on 8.3.2000. By the communication dated 27th May, 2000, the defendant only acknowledged the liability to pay an amount of Rs.62,892/- and, therefore, this acknowledgement under Section 18 of the Limitation Act would only extend limitation in respect of the amount so acknowledged. Therefore, I find no error in the judgment and the decree of the learned Trial Court. The appeal being without merit is dismissed. In the peculiar facts and circumstances of the case, the parties are left to bear their own costs. September 10, 2009 ( Deepak Gupta ) (m) Judge