Limitation — Acknowledgement of debt — On each repayment of loan limitation get extended — Limitation Act, S. 18, S. 19.

4 Limitation —
Acknowledgement of debt — On each repayment of loan limitation get extended —
Limitation Act, S. 18, S. 19.

[Dena Bank, Durg v. Smt.
Chameli Bai and Ors., AIR 2010 Chhattisgarh 49]

The Bank filed a civil suit
for recovery of loan advance to the defendant for purchase of tractor and
trolley. The loan was repayable in half-yearly instalments in seven years with
interest The Bank pleaded that the defendant kept depositing various amounts and
thus on each repayment of loan, the limitation period got extended by three
years.

The Court held that the
period of limitation for suits relating to accounts for the balance due on a
mutual, open and current account, where there have been reciprocal demands
between the parties, is three years and the time from which period begins to run
is to be computed from the close of the year, in which the last item admitted or
proved is entered in the account; such year is to be computed as in the account
as per Article 1 of the schedule to the Limitation Act, 1963.

In the present case also,
the account between the parties was at all times an open and current one. From
the transactions reflecting from the statement of account, it was clear that it
was mutual during the relevant period. As per S. 4 of the Limitation Act, 1891,
the plaintiff-Bank has submitted statement of account duly certified by the Bank
officer and the same is a prima facie evidence of the existence of such
entries, and the same may be treated as sufficient evidence to hold that the
defendant No. 1 deposited the sums towards repayment of loan on various
occasions. Thus, by virtue of S. 19 read with aforesaid Article 1 of the
schedule to the Limitation Act, 1963, fresh extended period of limitation of
three years is to be computed from the close of the year in which the last item
is admitted or proved as entered in the account.

The Suit was not barred by
limitation.