IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE M.N.KRISHNAN WEDNESDAY, THE 22ND DECEMBER 2010 / 1ST POUSHA 1932 AS.No. 349 of 1998() ------------------ OS.81/1995 of SUB COURT, NEYYATTINKARA ................... APPELLANT / DEFENDANT:- ----------------------------------------- N. KRISHNA PILLAI, GENERAL MERCHANT, PRAVACHAMBALAM, THIRUVANANTHAPURAM. BY ADVS. SRI.G.UNNIKRISHNAN SRI. P.V. RAMESH SHANKER SRI.G.P.SHINOD RESPONDENTS / PLAINTIFFS : - --------------------------------------------- 1. M/S. SABARI ROLLER FLOWER MILLS (P) LTD., A COMPANY REGISTERED UNDER THE INDIAN COMPANIES ACT, HAVING ITS REGISTERED OFFICE AT T.C.13/733/1, PALM GROVE GAS HOUSE LANE, KUNNUKUZHY, THIRUVANANTHAPURAM. 2. P.B. DEVARAJAN, RESIDING AT DEVALAYAM KAREETHU, THIRUVANANTHAPURAM, MANAGING DIRECTOR OF M/S. SABARI ROLLER FLOWER MILLS (P) LTD. (DIED) ADDL. R3 IMPLEADED 3. SYAMALA DEVARAJAN, W/O. DEVARAJAN, RESIDING AT DEVALAYAM KARETTU, THIRUVANANTHAPURAM, PRESENTLY MANAGING DIRECTOR SABARI ROLLER FLOWER MILLS (P) LTD. IMPLEADED AS THE REPRESENTATIVE OF DECEASED R2 AS PER ORDER DATED 18/11/2010 IN I.A. NO. 4140/2010. R1 & R2 BY ADV. SRI.K.SASIKUMAR FOR R2 BY ADV. SRI.R.SUGATHAN THIS APPEAL SUITS HAVING BEEN FINALLY HEARD ON 22/12/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: Mn M.N. KRISHNAN, J. = = = = = = = = = = = = = = = A.S. NO. 349 OF 1998 = = = = = = = = = = = = = = = Dated this the 22nd day of December , 2010. J U D G M E N T This appeal is preferred against the judgment and decree passed by the Subordinate Judge, Neyyattinkara in O.S.81/85. The suit is one for realisation of the amount. It is the case of the plaintiff that there were business transactions between the plaintiffs and the defendant with respect food articles and as on 12.4.92 an amount of Rs.28,598/- is due from the defendant. In spite of lawyer notice amount has not been paid hence the suit with claim for 24% interest. 2. The defendant filed a written statement that they had business transactions and further it is contended that the statement of account filed by the plaintiff before the Court is not A.S. 349 OF 1998 -2- true and he would deny that an amount of Rs.28,598 is due from him. According to the defendant the accounts are not being properly maintained and that on 9.5.92 and 14.6.92 payment of Rs.14,000/- and Rs.16,000/- has been paid to the representative of the plaintiff. It is also contended that for each transaction the time limit is three years and if so the suit is barred by limitation. He also prays for compensatory costs. The trial court raised necessary issues and granted a decree in favour of the plaintiff at the rate of 24% interest. It is against that decision the defendant has come up in appeal. During the pendency of appeal R2 died and legal representative is impleaded as R3. 3. Heard the learned counsel for the appellant as well as the respondents. The A.S. 349 OF 1998 -3- learned counsel for the appellant strongly contends before me that the suit is governed by Article 14 of the Limitation Act and for each transaction there is separate limitation from that date and as the suit does not appear to be one on the basis of accounts the suit is barred by limitation. 4. The learned counsel had drawn my attention to two documents, Exts.B1 and B2 wherein the total amount of Rs.28,598/- is arrived on the basis of 5 bills ranging from 9.3.92 to 12.4.92. The learned counsel would contend since each bill gives a separate cause of action that suit has to be filed within three years from that date and as the suit is not based on accounts there cannot be any saving of limitation as projected by the plaintiff. A.S. 349 OF 1998 -4- 5. The learned counsel for the plaintiff would contend that it can be seen from the first entry itself that Sl.No.4750 is not really for Rs.400/- but it is really for Rs.5,610/- and therefore the reference indicates about the account maintained by the plaintiff in the suit. When a suit on account has to be filed one has to specifically state that the account has been tallied and looked into, upto a particular date and on that date as per the accounts a particular amount is due from the defendant to the plaintiff. But now the date mentioned in the plaint is 12.4.92 and the amount claimed is Rs.28,598/-. I had perused the extract, Ext.A5 which would reveal that the said calculation is incorrect and therefore it is not on the basis of the account that the amount is claimed. Further with respect to each bill it is being A.S. 349 OF 1998 -5- mentioned is clear from Sl.No.4750 for an amount of Rs.5,610/- dated 9.3.92. From the accounts produced it can be seen that towards Bill No.4750, Rs.610/- was paid on 11.4.92, Rs.3,600/- on 20.4.92 and Rs.1,000/- on 27.4.92 and when it is added it comes to Rs.5,210/- and the balance comes to Rs.400 and that is what is shown in the notice. Therefore it has to be stated that the suit is not really based on accounts but on individual bills and therefore the question of limitation has to be considered in the light of Article 14 of the Indian Limitation Act. 6. Now the next question is whether there is any acknowledgment with respect to this amount. Exts.B1 would clearly indicate that what is sought to be realised from the defendant is a sum of Rs.28,598/-. To this notice a reply A.S. 349 OF 1998 -6- is sent which is marked as Ext.A4. Ext.A4 in so many terms admits the jural relationship between the plaintiff and the defendant. He also submits that the plaintiff considered the defendant as a perfect man in the business and ultimately the notice is concluded with the following recitals. “My client has to pay only a small sum to your client. Your client's claim is really an inflated one. Moreover claim cannot be legally enforceable against my client for various legitimate reasons. After accounting is done properly and correctly to the satisfaction of my client, he is willing to pay the balance amount if any in instalments. 7. So the sum and substance of Ext.A4 is that there is a jural relationship as debtor and A.S. 349 OF 1998 -7- creditor between the plaintiff and defendant. There had been transactions and the amount is due but he would further amplify and clarify that the amount that is due is not as claimed by him but it has to be settled after looking into the account. It is true that it is recited therein that the claim is not legally enforceable. So whether this statement would amount to acknowledgment is the question to be considered. 8. Now before going into the legal aspect I may also state that what was in the mind of the defendant is to be now read along with his contention in the written statement. His contention in the written statement is to the effect that on two dates an amount of Rs.20,000/- had been paid to the representative of the plaintiff and therefore only a small A.S. 349 OF 1998 -8- balance is due. There is no mention anywhere in Ext.A4 to the effect that the defendant had considered the transactions independently and has acknowledged only one of those transactions stating that only a small sum is due under the transaction. But what is stated therein is regarding the entire claim of Rs.28,598/- and the liability to pay after correctly looking into the affairs. So this being the position one has to now refer to the decision of the Full Bench of this Court reported in 1994 (2) KLT 190 Pillai v.Kaliyanikutty Amma. The Hon'ble Judges after taking into consideration the entire legal principles held that, “Therefore, the exact nature or specific character of the liability is not necessary but the words of acknowledgment must relate to a person and substantial liability, must indicate the existence of jural A.S. 349 OF 1998 -9- relationship between the parties, such as one is a debtor and the other is a creditor and there is an intention to admit such jural relationship. An acknowledgment does not require to be specific and direct. The substance of the decisions appear to be that it is not necessary that there should be a specific and direct acknowledgment of the particular liability which is sought to be enforced, but if there is an admission of facts of which the liability in question is a necessary consequence, there would be an acknowledgment within the meaning of S.18 of the Limitation Act. What is necessary is admission of the existence of a debt, a liability for contribution, in case a part of it is paid and such an admission would operate to enlarge the period of limitation.” 9. The Hon'ble Judges also considered the decision of the Division Bench of this Court, A.S. 349 OF 1998 -10- correctness of which was referred to before the Full Bench reported in 1980 KLT 817 Moidu v. Kerala State Electricity Board wherein the Division Bench held that, “If, as we have pointed out, the admission is not of any specific sum but of 'some amount', that again cannot operate as an acknowledgment even in respect of a lesser sum, for, no Court will be able to grant a decree in regard to 'some amount' on the basis of such an acknowledgment.” The impact of this was considered in paragraph 17 of the Full Bench and the Full Bench held that, “In fact, reading of the judgment shows that the question as to what constitutes an acknowledgment was not taken up for consideration and the question arose on an entirely different set of facts.” A.S. 349 OF 1998 -11- So the principles to be followed namely jural relationship, the transaction and the liability when is acknowledged then necessarily S.18 of the Limitation Act will come to the rescue of the plaintiff and therefore by virtue of the recitals in Ext.A4 I hold that S.18 of the Limitation Act will save the limitation for the plaintiff in this case. 10. Now lastly to the quantum. Now admittedly the amount that is due is Rs.28,598/-. The trial court has granted 24% interest. I feel that it is excessive and that has to be scaled down. Considering the year of transaction and the years that had passed I feel leniency is necessary especially under the circumstances. I feel interest at the rate of 10% before the decree and at the rate of 8% after the decree will be sufficient. When A.S. 349 OF 1998 -12- interest at the rate of 10% is calculated for the amount of Rs.28,598/- from 12.4.92 to 31.3.95 it will come to Rs.8,579/- making a total amount of Rs.37,177/-. Therefore the judgment and decree of the trial court are modified and a revised decree is passed as follows. 11. The plaintiffs, i.e. 1st plaintiff and R3 in the appeal are given a decree for realisation of an amount of Rs.37,177/- with 10% interest on the sum of Rs.28,598/- from the date of suit till the date of decree, i.e. 31.5.97 and at the rate of 8% on the said sum from the date of decree till realisation from the defendant with costs. The parties are directed to bear their respective costs in the appeal. M.N. KRISHNAN, JUDGE. ul/- A.S. 349 OF 1998 -13- M.N. KRISHNAN, J. = = = = = = = = = = A.S. No.349 OF 1998 = = = = = = = = = = = J U D G M E N T 22nd December, 2010.