# A. S. KRISHN\\PPA CHETTIAR & ORS v. NACHIAPPA CHETTIAR & ORS

- **Citation:** [1964] 2 S.C.R. 241
- **Court:** Supreme Court of India
- **Decided:** 1963-03-07
- **Case number:** Civil Appeals Nos. 104 to 107 of 1961
- **Bench:** K. SuBBA RAO, Raghubar Dayal, J. R. Mudholkar
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/a-s-krishn-ppa-chettiar-ors-v-nachiappa-chettiar-ors-2923
- **Pages:** 19

## Headnote

Limitation-Suspension of limitation in cases not covered
by any specific provision of the Act, general . principles ofLetter written by !lefendant to the trvstees-If acknowledgment
of
liability-Indian Limitation Act, 1908 (9 of 1908),
SP.
15 (1), 19.
The plaintiff, Ramanathan Chettiar, obtained a decree
in 0. S. N >. 45 of 1943 for the recovery of an amount due on
promissory note against one Venkatachalam Chettiar and
assigned the decree in favour of the appellant in C. A. !05 of
1961, The exer.ution application filed by him proved infructuous because the first defendant was adjudicated an insolvent
on February 27, 1945. On September 9, 1946 a composition
of the debts due from the insolvent and his son, the second
defendant, was arrived at. To the deed of composition the
second defendant was also a party though he was not adjudi·
cated an insolvent.
Under that deed the creditors, including
the four appellants in this case, agreed to take 40% of the dues.
Under the composition arrangement, the entire property of the
defendants, b,oth in India and in Burma was to vest in four
trustees, one of whom was the insolvent that is, the first
defendant to the suit. Two of the trustees were the present
appellant in C. A. No. I 04 of 1961 and the fourth trustee was
an outsider. The deed provided for the payment of the reduced
amount by the trustees to different creditors from the income
of the properties or by sale or mortgage of those properties
within four years from April 14, 1947. The deed further
provided for the extension of this time limit "according to
exigencies and necessity at the discretion of the first two
trustees" i. e., the first defendant and the appellant Chidambaram Chettiar.
The composition contemplated the realisation
of the dues of the creditors frorr1 the income or sale or mortgage
of the Burma property, in the first instance. "The composition
scheme was accepted by the insolvency court and the adjudica•
tion
of the first defendant as insolvtnt was annulled by the
court on December 19,
1946. Out of the Burma assets very
little was realised within the perio i of four years prescribed in
the composition deed and the trustees did not extend the time.
1963
March 7
1963
.ol. S. K .. ,nn.ppa
Cheuiar
v •
.Nochioppa ChtJliar
242
SUPREME COURT REP()RTS [1964] VOL.
111c appellants, therefor., s011ght execution of their decree9
against the Indian assets.
The last execution application in
0. S. Ko. 4G of 1943 was dismissed on September 19, 1946,
and no petition was filed thc•caftcr till June 13, 1952.
Similarly in the other three appf'als execution
applications were
filed more than three years afrrr the disrnisc;al of the provious
applications.
In
c.,ch of the execution applications, relier
was claimed only against the second defendant. The Subordinate Judge, heforc whom the cx~curion applications were filed,
held that the adjustment precluded each of the appellants
from executing his decree for a period of four yean; from
April 14, 1917 and, thcrr:fore, the execution applications were
within time. The High Court disagreed with the Subordinate
Judge and hold in~ that the execution petitions were barred by
time allowed the appeals.
The main
contcnlion of the
appellants in thi• Court was that the principle underlying
s. 15 (1) of the Limitation Act applied to the present case and
at any rate the letter written hv the second defendant to the
trustees opera!ed a• an
acknowledgment of liability under
s.19oftheLimitation Act.
Held, that s. 15 (I) of the Lim ital ion Act is restricted
In its application to a case \vhcre the execution of a decree
has been stayed hy an injunction or an order. ~frie Limitation
Act is a piece of arljective
or
procedura] law and not of
substantive law.
RuJcs
of Proccdtue cannot be extended by
analogy or reference to procer.dings to y,·hich they do not expressly apply or could be said to apply by nec.,sary implication.
Suspension
of Limitation
in
circumstances of the kind
obtaining in these apreals is neith

## Text

2 S.C.R.
SUPREME COURT REPORTS
241
A. S. KRISHN\\PPA CHETTIAR & ORS.
v.
NACHIAPPA CHETTIAR & ORS.
(K. SuBBA RAO, RAGHUBAR DAYAL and J. R.
MUDHOLKAR jj)
Limitation-Suspension of limitation in cases not covered
by any specific provision of the Act, general . principles ofLetter written by !lefendant to the trvstees-If acknowledgment
of
liability-Indian Limitation Act, 1908 (9 of 1908),
SP.
15 (1), 19.
The plaintiff, Ramanathan Chettiar, obtained a decree
in 0. S. N >. 45 of 1943 for the recovery of an amount due on
promissory note against one Venkatachalam Chettiar and
assigned the decree in favour of the appellant in C. A. !05 of
1961, The exer.ution application filed by him proved infructuous because the first defendant was adjudicated an insolvent
on February 27, 1945. On September 9, 1946 a composition
of the debts due from the insolvent and his son, the second
defendant, was arrived at. To the deed of composition the
second defendant was also a party though he was not adjudi·
cated an insolvent.
Under that deed the creditors, including
the four appellants in this case, agreed to take 40% of the dues.
Under the composition arrangement, the entire property of the
defendants, b,oth in India and in Burma was to vest in four
trustees, one of whom was the insolvent that is, the first
defendant to the suit. Two of the trustees were the present
appellant in C. A. No. I 04 of 1961 and the fourth trustee was
an outsider. The deed provided for the payment of the reduced
amount by the trustees to different creditors from the income
of the properties or by sale or mortgage of those properties
within four years from April 14, 1947. The deed further
provided for the extension of this time limit "according to
exigencies and necessity at the discretion of the first two
trustees" i. e., the first defendant and the appellant Chidambaram Chettiar.
The composition contemplated the realisation
of the dues of the creditors frorr1 the income or sale or mortgage
of the Burma property, in the first instance. "The composition
scheme was accepted by the insolvency court and the adjudica•
tion
of the first defendant as insolvtnt was annulled by the
court on December 19,
1946. Out of the Burma assets very
little was realised within the perio i of four years prescribed in
the composition deed and the trustees did not extend the time.
1963
March 7
1963
.ol. S. K .. ,nn.ppa
Cheuiar
v •
.Nochioppa ChtJliar
242
SUPREME COURT REP()RTS [1964] VOL.
111c appellants, therefor., s011ght execution of their decree9
against the Indian assets.
The last execution application in
0. S. Ko. 4G of 1943 was dismissed on September 19, 1946,
and no petition was filed thc•caftcr till June 13, 1952.
Similarly in the other three appf'als execution
applications were
filed more than three years afrrr the disrnisc;al of the provious
applications.
In
c.,ch of the execution applications, relier
was claimed only against the second defendant. The Subordinate Judge, heforc whom the cx~curion applications were filed,
held that the adjustment precluded each of the appellants
from executing his decree for a period of four yean; from
April 14, 1917 and, thcrr:fore, the execution applications were
within time. The High Court disagreed with the Subordinate
Judge and hold in~ that the execution petitions were barred by
time allowed the appeals.
The main
contcnlion of the
appellants in thi• Court was that the principle underlying
s. 15 (1) of the Limitation Act applied to the present case and
at any rate the letter written hv the second defendant to the
trustees opera!ed a• an
acknowledgment of liability under
s.19oftheLimitation Act.
Held, that s. 15 (I) of the Lim ital ion Act is restricted
In its application to a case \vhcre the execution of a decree
has been stayed hy an injunction or an order. ~frie Limitation
Act is a piece of arljective
or
procedura] law and not of
substantive law.
RuJcs
of Proccdtue cannot be extended by
analogy or reference to procer.dings to y,·hich they do not expressly apply or could be said to apply by nec.,sary implication.
Suspension
of Limitation
in
circumstances of the kind
obtaining in these apreals is neither txplicit nor in1plicit in
s. 15 upon which reliance is placed by the appellants.
Gorind J.Vail· Gurunrtlhnaik v.
Brv!lawan11awa Parutap'fXl,
T. L.R. 19·11
Born. 435, Pu/in Chamlm Sen v. Amin Mia
Mu,affar Ahmad, A. l.R.1933 Cal. 508. Uikhan Chunhr Sen v.
Madhusudan Sen,
(1907) I. L. R. 35 Cal. 209, Nrityanwni
Drvi<i v. Lakhan Chri<idrri Sen.
(1916) l. L. R. 43 Cal 660,
Badruddin Khan v. Jfahyar Khan, I. L. R. 1939 All. 103 and
ltlanay!.ng
Committee
lblnd~r
Sin~th Malha Sinyh llajput
lligh School, lnrlorr. v. l?untler Sigh !Jfrz.lha jf)ingh Sana.tan /)ha.rma
Rajput High Soho>l Tru•I, I. L. R. l 9l5 I.ah. 8, distinguished.
HP.Id, further, that in the prese11l appeals two different
set\ of persons, the defendants and the
·r1ustee" \vrre liable
and rheir respective liabliti"s were
cti~tinct.
·ro refer \O a
liablility resting on SC;me one else was
not to acknowledge
one's own Jiabiliry \vithin the meaninl{ of the word ins. 19.
The dofcndant No. 2 had r.ot even indir.ctly referred 10 the
I
- .
__ ,
2 S.C.R.
SUPREME COURT REPORTS
243
decree much less to the liability arising under any of them.
In the circumstances it must be held that the letter dated
April 19, 1949, did not extend the period of limitation.
Khan Bahadur Shapoor Freedom Mazda v. Durga Prosad
Ckamaria [1962] l S. C. R. 140, held inapplicable
CIVIL APPELLATE JURISDICTION: Civil Appeals
Nos. 104 to 107 of 1961.
o
Appeals from the judgment and order dat~d
July 5, 1956, of the Madras High Court in Appeal
against order No. 480, 454, 478 and 479of1954
respectively.
_ A. V. Viswanatha Sastri and R. Gopalakrishnan,
for the appellant.
K. N. Rajagopal Sastri
and
]JI. S. Narasimhan, for respondent No. I.
1963. March 7.
The Judgment of the Court
was delivered by
1969
.4. S. Krishnap1a
Chettiar
••
NllchioPJa f;/idtiarMUDHOLKAR ].-This
appeal
and
civil
M•diwlkor /,
appeals Nos. I 04, 106 and 107 of 1961 arise out of
execution proceedings in four different suits but as
they involve a common question they were heard
together by the High Court and by us. That question is whether the exocution applications out of
which these appeals arise are within time.
We propose to treat C. A. No. 105 of 1961 as
a typical case.
The -relevant facts
thereof are
brief! y these :
In 0. S. 46 of 1943 one Ramanathan Chettiar
instituted a suit against one Venkatachalam. Chettiar
in the court of the Subordinate Judge of Devakottai,
for the recovery of a sum of Rs. 10,285/- due on
promisory note dated November 20, 1942 with interest thereon.
He eventually obtained a decree for
the full claim. In so far as the second defendant
..... _,_.
 .
..; • - • •-•-.;-........ "'~ ... .-.,, ..... > --···Ill ••
A. S. Jr.:rishnappa
Ch1tt:ar
v.
Nadtiappa Ch1ttiar
.A-iudhotkt.r J.
244
SUPREME COURT REPORTS [1964] VOL.
is concerned, he was made liable for the decretal
amount to the extent of this interest in the joint
family property of himself and his father.
The
plaintiff assigned the decree in favour of Chidambaram Chettiar, who is the appellant in C. A. 105
of 1961. He filed an execution application but the
execution proceedings commenced by him proved
infructuous because the first defendant was adju'dicated an insolvent on
February 27, l 945. On
September 9, l 94fi a composition of the debts due
from the insolvent and his son, the second defendant
was arrived at. To the deed of compr,sition tht
second defendant was also a party though he was
not adjudicated an insolvent. C'ndrr that deed the
creditors, including the four appellants before m,
agreed to take.40% of the dues, except one creditor
who was to be paid a little m9re. The defendants,
it may be mentioned, h:id extensive money-knding
business in Burma and the bulk of their property
was situate in that country.
Undt r the composition
arram;ement. t e
entire property of the
defendants, both in India and in
Burma was
to vest in four trustees, one of whom was the insolvent, that is, the first dtfendant to the suit.
Two
of the trustees were the present appellants, Chidambaram Chcttiar and Krisbnappa Chettiar, appellant
in C. A. JO i of I Otil., The fourth trustee was an
outsider. The total indebtedness of the defcnd:rnts,
as asceriained on tl:e dale on which the composition
was efJected, was
Rs. 2,lfi,077/4/8/-
but it was
reduced under the arrangement to ]{s. 86,43_0-13-3.
There arc
four sr.hcdulcs to the composition deed.
Schedule A setc, out the names of the creditors and
the amounts due to them,
Schedul~ B sets out the
prop2rtics of the defendants and Schedules C and D
set out the properties at Leiwo and Meola respectively in Burma. The deed provides for the payment
of the reduced amount by the tr4slees to different
creditors from the income of the properties or by
sale or mortgage of those
properties within four
-
- -.
2 S.C.R.
SUPREME GOUR'!' REPORTS
245
years from
April 14,
1947.
The deed further
provides for the extension of this time limit "according to exigencies and necessity at the discretion of
the first two trustees" i.e., the first defendant and
the appellant Chidambar'!m Chettiar. The arrangement also provides for payment of interest at 5 annas
per mensem in respect of the amounts due on the
decrees and 4 annas per mensem in respect of other
outstandings as from April 14, 194 7.
The composition contemplated the realisation of the dues of the
creditors from the income or sale or mortgage of the
Blll'ma property,
in the first instance. Clause 10
which deals with this matter runs as follow :
"In case the properties of Burma firm are not
sufficient to pay the amounts set apart as payable to the creditors at 40 per cent the individuals Nos. 1 and 2 Trustees shall sell the
properties in British India and set out in the
B schedule herein and from out of the sale
proceeds distribute the amount to the creditors.
Similarly, after the 40 per cent amounts have
been paid and if there should be any amount
of deficiency for the payment of the 60 per cent
amount payable to Krishnappa Chettiar as
described in para 6 supra, even for that also,
the individual Nos. 1 and 2 Trustees shall sell
the aforesaid British India properties and pay
the aforesaid Ki;ishnappa Chettiar the entire
balance amount."
The composition deed contains various other terms
out of which it would be relevant to set out only the
following two :
"Clause 8 : Until 40 per cent of the amount is
paid to the creditors as aforesaid, the said
Trustees, shall at the time of disbursement of
the dividend, pay from the 1st Chitirai of the
year Sarvajith for the annual expenses of the
1953
A. S. Krishn•PP•
Chettiar
••
Nachi1bpa Che!tia1
Mudholkar J.
A. S lrri,hMj>fHI
Ch11tiu
v.
N•dU.P~ Clut1i¥
Muilv>U..r J.
246
SUPREME COURT REPORTS [Hl<l4] VOL.
family, '! ~um of Rs. 1300 per annum to individual No. 4 Trustees Vcnkatachalam Chettiar
and a sum of Rs. 300 per annum to his son
Nachiappa Chettiar for the aforesaid expenses.
Clause JG : After the annulment of the order
of adjudication herein, the aforesaid Venkata·
chalam Chettiar shall, in respect of transfer
etc., of management of the properties mentioned
in C and D schedules, ~xecute a general powerof attorney in the favour of individual Nos. I
and 2 trustees and ha vc the same registered."
The composition scheme was accepted by the insol·
vcncy Court and the adjudication of the first defendant as insolvent was annulled by the court on
December Hl, l!l46.
Due to political changes in Burma only very
little was realised out of the Burma assets within
the period of four years prescribed in the composition
deed. The trustees who were empowered to extend
the time did not extend it. The appellants, therefore, turned to the India~ assets and sought execution
of their decrees against them.
Two contentions were
raised on behalf of the defendants. · One was that
the Indian a'ISets could not be sold until the assets in
Burma were completely exhausted and the other was
that the execution applications were barred by time.
In 0. S. No. 46 of I9t3 the last execution
application was dismissed on September HJ, 1946
(E. P. No. 109 of 1946). No execution petition was
filed thereafter till the present petition (E. P. No. 117
of 1952). This was filed
on
June 13,
1952.
Similarly in the remaining three appeals also execution applications with which we arc concerned were
filed more th~n three years after the dismissal of the
previous execution applications. It may be mentioned that originally the appellant as well as appellants
in the other appeals had sought the execution of their
2 S.C.R. SUPREME COURT REPORTS
247
respective decrees for
the full amount. But they
amended their petitions later on pursuant to the orders
of the court and restricted their claims to 40 per cent
of the amounts due under their decrees.
The appellant Chidambaram filed an affidavit along with the
execution petition and set out the following grounds
in support of his contention that the execution application was within time.
"The trustees were able to realise some of the
assets of the defendants in Burma and to pay a '
dividend of 10 per cent to the creditors. I was
paid a sum of Rs. 562-4-0 by way of dividend
for this decree on August 10, 1949.
Aq the
rest of the Burma assets of the defendant could
not be realised by the trustees on account of
the civil war in Burma and the land legislations
passed there and as there was no prospect of
their being realised in the near future myself
and A. S. K. Krishnappa Chettiar aforesaid as
managing trustees under the said composition
offered to extend the period of management by
one year provided the defendants would consent
to their Indian assets being realised and distributed among the creditors.
But the defendants
were not willing thereto and hence we thought
fit to extend the period of our management.
We have filed a petition in I. A. No. 87 of 1951
in the suit I. P. No.
1 of 1945 to have
the said ·composition scheme set aside and the
1st defendant re-adjudged as insolvent. The
said petition is pending.
I
7.
I am advised that as the said composition
arrangement has failed on account of the assets
of the defendants not being realised and the
debts discharged within the four year period
mentioned therein I am in law and in equity
entitled to recover the entire amount due to me
under this decree by executing it.
1963
A. S. KriJhnappa
Chettiar
v.
N achiappa Chetti21
Mudholk.r J.
1~63
A. S K1i1l1n~ppa
Chettiar
v.
J\'achiappa Cluttiar
Mudholkar J.
248 !:>Ul'REME COURT REPORTS [l964]VOL.
8. The said composition pro~ides for a maintenance allowance of Rs. 600 and
Rs. :l 0
annually being given to the 1st and 2nd
defendant respectively at the time of distribution of the dividends. In respect
thereof
a notice was
issued by the 2nd defendant on
April 19, l 94!J to myself and A. S. K. Krishnappa Chettiar aforesaid wherein there
is an
acknowledgment of liability in respect of the
several debts mentioned in the said composition.
Further the trustees have, acting under
the authority given to them by the d·:fendants
under the said composition, paid me Rs. 562-4 -0
on August 10, 1!!49 l>y way of dividend for
this decree and have duly entered the same in
the accounts maintained bv them.
Moreover
I could not execute the de~rce during the four
years from April 14, 1947 or any extended
period during which
the trustees had to
manage, realise and distribute the assets of the
defendants.
There is therefore no question of
limitation.".
Similar grounds were set out in the affidavits filed by
the other appellants also.
It may be mentioned that in each of the ex•
cution applications relief was claimed only against
the second defendant because in ins.olvency petition
No. 87 of 1951 filed by some of the creditors the
first defendant, was readjudicated an insolvent by
the court on August 3, 1954.
The execution application was, as already stated, opposed by the second
defendant firstly on the ground that the composition arrived at between him and his father on the
one hand and the creditors on the other was still in
force,
that the arrangement was irrevocable and
operated as a complete discharge of the liability of
the defendants for all time. The second ground was
that the execution applicati?n was barred by time.
2 S.C.R.
SUPREME COURT REPORTS
249
The precise pleas of the second defendant regarding
limitation were as follows :
(a) that the adjudication of his father as an
insolvent and the pendency of insolvency
proceedings against him would not affect
limitation in so far as he was concerned;
(b) that the receipt by the appellant and
other creditors of certain amounts as
dividends ·in August, 1949 would not extend the period of limitation for execution
proceedings ;
(c) that the acknowledgment relied upon
is "wholly wrong, misconceived
and
untenable."
According to him there was no acknowledgement of liability or any kind in the notice referred
to in the affidavit much less the liability of the
second defendant to discharge the decree which had
in fact become extinguished and effaced by reason
of the composition arrived at on September 9, 1946.
In the course of the arguments before the
executing court it was urged on behalf of the appellants in those appeals that the four years within
which the trustees were required to realise the
Burma properties and pay off the debts of the credi·
tors must
be regarded as a period during which
the execution of the decrees was stayed and that
consequently on the principles underlying s. 15 of
the Indian Limitation Act, 1908, that period should
be deducted from computing the period of limitation
for preferring execution applications. The Subordinate Judge, before whom the execution applications were filed, upheld this contention and held that
the execution applications were within time.
He
also held that the execution applications arrived
at between the parties operated as an adjustment
1963
A. S. Kri.•hnappa
Chettiar
v.
Nachiappa Chettiat
Mudha/kar J.
1963
A S. f&',iJhn1ppa
Clle!liar
••
Nadiiapp2 Clttttiar
Mu1holkar J,
250
SUPREME COUR'f REPORTS (1964] VOL.
of the decree on the date on which that composition
was effected or from the date on which the adjudication was arrived at and that though the composition
could not be certified to the executing court under
0. XXI, r. 2, C. P. C. within the time permitted by
law, it could be certified even now at the instance of
the decree·holdcr because it was open to the decreeholder to certify an adjustment at any time he liked.
According to the learned Subordinate Judge, the adjustment precluded each of the appellants from excuting his decree for a period of four years from
April 14, IIH i and, therefore, the execution applications were within time.
The High Court, however,
disagreed with the Subordinate Judge on both the
grounds and holding that the execution petitions
were barred by time allowed the appeals. It may
be mentioned that neither of the two courts below
has considered the contention of the appellants in
these appeals that the letter dated April 19, 1949
sent by the second defendant to two of the trustees
operated as an acknowledgment of their liability or
that dividends paid to the appellants by the trustees
in August, 1949 operated to extend the time of
limitation.
Mr. Viswanatha Sastri, who appears for the
appellants in these appeals, has raised only two
contentions. The first is that the principle underlying
s. 15 ( l) of the Limitation Act is applicable to a
case of this kind and that, therefore, the execution
applications are within time. The second is that at
any rate the letter dated April I H, 1949, written by
the second defendant to the trustees operates as an
acknowledgment of liability under s. I!l of the Limitation Act and, therefore, saves the limitation in
respect of all the execution applications except the
one out of which C. A. No. 104 of 1!)61 arises.
According to .Mr. Sa~tri the composition of a decretal debt does not amount to
an adjustment or
satisfaction of a decree until the acts required to be
,.
•
l
f
/ -
2 S.C.R.
SUPREME COURT REPORTS
251
done thereunder have been performed.
Here the
composition scheme required payment of 40 per cent
of the decretal debts by the trustees to the craditors.
According to him, until that condition was fulfilled
the original decree cannot be said to have been
satisfied. Since the decrees herein involved could
not be regarded as having been satisfied they are
still alive. Then, according to Mr. Sastri, where a
composition scheme prescribes the penod during
which a condition has to
be performed, tillthe
expiry of the period or performance of the condition
the operation of the decrees must be deemed to have
been stayed.
For, during this period it would be
incompetent to the decree-holders to execute their
decrees.
Such
period
could
therefore
be
deducted by
applying the principles underlying
s. 15 ( 1)
of
the
Limitation
Act
from
computing the period of limitation for filing a fresh ,
execution application.
He concedes that here the
composition scheme not having been certified to the
execution court, the defendants would not have been
able to resist an execution application if made within
the period of four years specified in the deed of composition.
But the composition being binding on the
appellants, they would have laid themselves open to
suits for damagei at the instance of the defendants if
they had proceeded to execute their decrees within
this period.
Section 15 ( l) of the Limitation Act
runs thus :
"15 (1) : In computing the perfod of limitation prescribed for any suit or application for
the execution of a decree, the institution or
execution of which has been stayed by injunction or order, the time of the continuance of
the injunction or order, the day on which it
was issued or made, and the day on which it
was withdrawn, shall be excluded."
It is clear from its terms that it is restricted in its
application to a case where the execution of a decree
1963
,-
A. S. 11.rishnappa
Chettiar
v.
Nachiappa Ch.iti•r
Mudholkar J.
1963
A. S. J.:rishnappa
Chtttiar
v.
Nachiappo. Chttliar
MudhoUM J.
252 SUPREME COURT REPORTS (1964] VOL.
has been stayed by an injunction or an order. By no
stretch of imagination can it be said that the acceptance by the insolvency court of the composition
operated as a stay of execution of the dccret-s for the
period of four years referred to in the deed or as an
injunction.
Further, the second defendant was not a
party to the insolvency proceedings and could, therefore, not have been entitled to the benefit of the
order of the court accepting the scheme of composition.
In support of his contention that the principles
underlying s. 15 (1) are applicable to a case like the
present one, Mr. Sastri has strongly relied on the
decision in Govindru;ik Uurunathnaik v. Basawannawa Parutappa (').
There, Beaumont C. ]., has
observed at P· 437 :
"Section 15 of the Aa:t recognizes the principle that in computing the period of limitation
prescribed for an application for the execution
of a decree, any period during which the execution of the decree bas been stayed must be
excluded; and it would certainly seem right to
apply a similar principle to applications in a
suit which bas been stayed; in terms, however,
the section does not apply. The only authority
on the point, to which we have been referred,
and which was referred to in the lower Courts,
is l'ulin Chandra Sen v. Amin Mia JJfuzffar
Ahmad (')."
Saying that this decision had stood for some years
and had not been dissented from the learned Chief
Justice observed :
'
"I would rather base the appellant's case on
the ground that the right to apply for a final
decree was suspended during the period in
which the suit was stayed.
Such a principle
was applied by the Calcutta High Court
(1) I.L.R, 1941Bom.43'·
(2) A.I.a. 1933 Cal. 508.
-
2 S.C.R. SUPREME COURT REPORTS
253
in Lakhan Chunder Sen v. Manhusudan Sen (
1
)
affirmed by the Privy Council in N rityamoni
Dassi v. Lakhan Chandra Sen (2)."
It would thus appear that the learned Chief.Justice
based his decision really on s. 14 of the Limitation
Act.
In both the cases referred to by the learned
Chief Justice the provisions of s. 14 of the Limitation
Act were applied.
In Pulin Chandra Ben's case('), the facts were
these: The next friend of a minor instituted a suit
upon a mortgage but died after the preliminary
decree was passed. No new next friend was, how·
ever, appointed in his place. The minor made an
application for passing a final decree within 3 years
after attaining majority, but three years after the
petiod of grace fixed by the preliminary decree. The
High Court, while holding that though the erstwhile
minor was not entitled to claim the benefit of s. 6 of
the Limitation Act, held that the execution application
must be regarded as within time since it had been
made within three years from the d?.te when the right
to apply accrued to him on his attaining majority.
No doubt, this is a case where in effect the court
has applied the principles under!) ing s. 6 though it
was clearly of opinion that s. 6 in terms did
not apply.
There is no discussion of the point at all
and, therefore, we do not think that this is a decision
which needs to be considered.
The next two decisior.s relied on are Badruddin
Khan v. Mahvar Khan (1) and Managing Committee
Sundar Singh Malha Singh Rajput High School,
lndora v. Sundar Singh
Malka Singh Sanatan
Dh11.rml1 Rajput High School Trust ('). In both these
cases the court applied what according to it were the
general principles underlying s. 15 of the Limitation
Act, though the facts of these cases do not strictly
fail within the purview of that section. The question
(1) (1907) I L.R. 35 Cal. 209. •
(21 (1916) LL R. 43'cal 660.
<3 A.IR. 1933 C•I, 508.
14) l.L.R. 1931 All 101
(5) I.L.R. 1945 Lah. 8.
1963
A. \. Krish>ioopa
Ghtttiar
v.
Nae iapp 1 Chettiar
Muaholku.r I.
1963
A S. Ir•iJhMpfla
Chtlliar
v.
Nachi'appJ
C~ttiar
254 SUPREME COlRl REPORTS [1964) VOL.
is whether there is any well.recognized prindple
whcreunder the period of limitation can be regarded
as being suspended bfcause a party is prevented
under certain circumstances from taking action in
pursuance of his rights.
The Limitation Act is a
consolidating and amending statute relating to the
limitation of suits,
appeals and
certain types of
applications to courts and must, therefore, be regarded as an exhaustive Code. It is a piece of adjective
or procedural law and not of substantive law.
Ruks
of procedure, whatc\ er they may be, are to be
applied only to matters to which. they are made
applicable by the legislature expressly or by necessary
implication.
They canuot be extended by analogy
or reference to proceedings to which they do not
expressly apply or co1;ld be said to apply by necessary
implication. It would, therefore, not be correct to
apply any of the provi-ions of the Limitation Act to
matter> which do not strictly fall within the purview
of those provisions.
Thus, for instance, period of
limitation for various kinds of suits, appeals and
applicalions arc prescribed in the First Schedule.
A
proceeding which does not fall under any of the
articlrs in tt.at schedule could not be said to be barred
by time on the analogy of a matter which is governed
by a particular article.
For the same reasons the
provisions of ss. 3 to 28 of Limitation Act cannot be
applied to situations which fall outside their purview.
These provisions do not adumbrate any general
principles of substantive law nor do they con fr r any
substantive rights on litigants and, therefore, cannot
be permittt d to have greater application than what is
explicit or implicit in them. Suspension of limitation
in circumstances of the kind obtaining in these
appeals is neither explicit nor implicit ins. 15 upon
which reliance is placed on behalf of the appellants.
We are, therefore, unable to accept the first argument
of ivtr. Sastri.
Coming to the second argument of Mr. Sastri
it would be usdul to reproduce th~ relevant portion
•
,
2 S.C.R.
SUPREME COURT REPORTS
255
of the letter dated April 19, 1949, on which reliance
is placed :
"The properties of our client's family and his
father, Venkatachalam
Chettiar's share of
properties have vested in you in the capacity
of Trustees as per the composition scheme of
arrangement effected on September 9, 19!6
and you are managing the same, and you have
to pay Rs. 300 per annum to our client from
1st Chitrai of Sarvajit year (April 14, 1947)
for his family expenses as provided in the
scheme of composition and you have paid
Rs. 300 and for the year Sarvajit and have
obtained a receipt therefor from my client.
You have not paid the sum of Rs. 300 due for
the year Sarwadhari to our client though he
demanded you many times.
As it. is learnt that
individual No. 2 out of you, are raising nonmaintainable objections and the sum of Rs. 300
due for the year Virodhi, still remains to be
μaid, I have been given instructions to demand
the. total amount of Rs. 600 payable for the
aforesaid years. So you should pay the amount to
my client and obtain a receipt therefore within
one week after the receipt of this notice. Further
you have till now collected Rs. 17,500 as per
the scheme of arrangement and though you
have received the amount long time ago, you
have not paid to the creditors their dividend
amounts, you are bound by law and equity to
pay interest to the aforesaid
amounts
You
are hereby informed that as you have not paid
to the creditors the dividend amounts my
client is put to a heavy loss and that you are
bound to bear all the losses that may be camed
thereby and make good the losses ; you should
immediately pay off the creditors the dividends
and in default my client will have to launch
1969
A. S Krishn<PPa
Ch,ttior
v.
Nachiappa Clutti:nMudho1kar J.
1963
A. S. '•islrnaf!pa
Ch1ttiar
v.
!( a,ltiapp3 Chtttia
Mudiw/;ar J.
256
SUPREME COURT REPORT::-.(1964] VOL.
proceedings against you and seek reliefs through
Court."
This letter was written ·by the vakil of the
second defendant to the Trustees demanding pay·
ment of the maintenance allowance due to the
second defendant. The second object of this letter
was to require the trustees to pay out of the funds in
their hands dividrnds due to the various creditors
under the composition scheme. JI.Ir. Sastri contends
that this letter contains a definite admission of the
jural relationship between the defendant on the one
hand and the creditors on
the other-i. e., the relationship of creditor and debtor and, therefore, this is an
admission of liability under the decrees. Relying upon
the decision of this Court in Khan Bahadur Shapoor
Preedom
.\fazrla v. Durga
l'rosad Glvmuiria ('),
he says that the. essential requirement for sustaining a pica' of acknowledgment
under s. 19 of the
Limitation Act is that the statement on which it is
sougbt to be founded must relate to a subsisting
liability, indicate the existence of jural relationship
and must be intended, either expressly or impliedly,
to admit that jural relationship.
Where such jural
relationship is admitted expressly or impliedly, he
contends, that the mere fact that the precise nature
of the liability is not mentioned would not prevent
the acknowledgment from falling within s. 19. That
was a case in which the mortgagor had writtento
his creditor a letter to the following effect :
"'.\.ly dear Durgaprosad,
Chandni Bazar is again advertised for sale
on Friday the 11th inst. I am afraid it will
go
very cheap.
I had a private offer of
Rs. 2, 7ii,OOO a few days ago but as soon as
they heard it was advertised by the Registrar
they withdrew.
As you arc interested why
do you not take up the whole. There is only
(I) [ 1961] 1 S.C.R. 140.
2 s.a.R.
SUPREME COURT REPORTS
257
about 70,000 due to the mortgagee-a payment
of 10,000 will stop the sale.
Yours sincerely,
Sd/ J. C. Galstaun."
The question to be considered was whether this
amounted to an acknowledgment of the mortgagee's
right.
This Court held that it did amount to an
acknowledgment and observed thus :
"It is thus ·clear that
acknowledgment as
prescribed bys. 19 merely renews debt; it does
not create a new right of action. It is a mere
acknowledgment of the liability in respect of
the right in question ; it need not be accompanied by a promise to pay either expressly or
even by implication. The statement on which
a plea of acknowledgment is based must relate
to a present subsisting liability though the
exact nature or the specific character of the
said liability may not be indicated in words.
Words used in the acknow lcdgment must,
however, indicate the existence of jural relationthip between the parties such as that of
debtor and creditor, and it must appear that the
statement is made with the intention to admit
such jural relationship.
Such intention can be
inferred by implication from the nature of the
admission and need not be expressed in words.
If the statement is fairly clear then the intention to admit jural relationship may be implied
from it.
The admission in question need not
be express but must be made in circumstances
and in words
from which the court can
reasonably infer that the person making the
admission intended to refer to a subsisting
liability as at the date of the statement. In
construing words used in the statements made ii)
1953
· A. S. Krishnappa
Ch1ttiar
v.
Nachiappa Chttli a
Mudho/kar J.
1963
A. S. KriJhna,P.
ClrtUiar
v.
Na.c/riappo Chtttiar
Afu'111lkar J,
258 SUPRENIE COURT REPORTS [1964] VOL.
writing on which a plea of acknowledgment
rests oral evidence has been expressly excluded
but surrounding circumstances can always be
considered. Stated generally courts lean in
favour of a liberal construction of such state·
ments though it docs not mean that where no
admission is made one should be
inferred,
or where a statement was
made clearly
without intending to admit the existence of
jural relationship such intention
could be
fastened on the maker of the statement by an
involved ~or far-fetched process of reasoning.
Broadly stated that is the effect of the relevant
provisions contained in s. 19, and there
is
really no substantial difference between the
parties as to the true legal
position in this
matter."
In our opinion, this case is not of assistance co the
appellants. In the appeals before us though there
was a personal liability on the defendants under
the various decrees, their liability which was created
by the composition deed was only on properties in
which they had, consequent on the creation of a
trust under the composition deed, only a beneficial
interest. This new liability had to be discharged by
the trustees in whom the leg~! title to the property
vested
Thus there were •wo different sets of persons
who were liable, the dc'cndants and the Trustees and
their respective liabilities were distinct. What the
defendant No. 2 has referred to is the libility of the
Trustees arising under the terms of the deed of
composition and could be enforced only against them.
To refer to a liability resting on someone else is not
to acknowledge one's own liability within the
meaning of the word in s. Hl. The defendant No. 2
has not even indirectly referred to the decree much
less to the liability arising under any of them.
In
the circumstances we must hold that this letter does
not extend the period of limitation. For these reasons
2 S.C.R.
SUPREME COURT '.'IBPORTS
259
we uphold the decision of the High Court and dismiss
each of
these appeals with costs. There will,
however, be only one hearing fee.
Appeal& dismissed.
--
LAKSHMI ACRI AND OTHERS
v.
T.v.v. KAILASA TREVAR AND OTHERS
(S. K. DAS, A. K. SARKAR, 1\1. HrnAYATULLAH and
N. RAJAGOPALA AYYANGAR JJ.)
D<bt Relief-Agriculturist-Scaling down of decree debtEnabling statute coming into force pending appeal-Application
made 1Jfter appellate decree, if barred by res-judicata-Madras
Agric1.tturists Relief Act, 1938 (Mad. 4 of 1938), as amended by
Madras Act 23 of 1948, BB. 16 (iii), 19 (2).
The appellants had filed a suit on a mortgage against
respondent No. I and others as defendants and had obtained
a preliminary decree in it on May, 15, 1937 and a tinal decree
on January 20, 1938. Appeals were filed against the preliminary
Decree in the High Court of Madras.
While the app.·als were
pending there, the Madras Agriculturi•ts Relief Act, 1938 came
into force. The defendants in this suit other than respondent
No. 1 thereupon applied for relief under this Act. The applications succeeded and the High Court passed a new preliminary decree on
March
~!5, 1942 after sca1ing down the
amount recoverable in accordance with the Act.
The respondent No. I had neither contested the suit nor
appeared in the appeal! nor made any application under the
Act for relief. 'T'he preliminary decree passed by the High
Court, therefore, confirmed a• against him the decree passed
by the trial Court.
Respondent No. I thrreafter applied to
the trial Court for relief under the Act but the application was
dismissed on the ground that in view of the judgment of the
High Court the application was not maintainable in the trial
Court.
Respondent No. I thereafter applied to the Hig;.
1969
A. S. Krishnappo
Chaltiar
...
NorhiaPP• Chmiar
Mudholkor /,
1963
Morch 7
I