What is acknowledgement?
Acknowledgement, in the legal context, is essentially a debtor’s formal recognition of existing liability. According to Black’s Law Dictionary, acknowledgement signifies “a recognition of something as being factual,” which in this case is the factual existence of a debt or liability. An Acknowledgement is an admission by the writer that there is a debt owing by him, either to the receiver of the letter or to some other person on whose behalf the letter is received, but it is not enough that he refers to a debt being due from somebody. An acknowledgement must be one from which an absolute promise to pay can be inferred, or an unconditional promise to pay the specific debt, or that there must be a conditional promise to pay the debt and evidence that the condition has been performed.
The acknowledgement doesn’t need to contain an express promise to pay. The acknowledgement’s intent is to confirm the existence of the debt, with the signature indicating that the debtor willingly admits to the liability.
What constitutes Acknowledgement?
An acknowledgement is not limited in respect of a debt only, it may be in respect of “any property or right” which is the subject matter of the suit. Acknowledgement under section 18 means an admission of the truth of one’s own liability. Such admission may be expressed or implied.
Section 18. Effect of acknowledgment in writing.—
(1)Where, before the expiration of the prescribed period for a suit of 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.
Section 19. Effect of payment on account of debt or of interest on legacy.—
Where payment on account of a debt or of interest on a legacy is made before the expiration of the prescribed period by the person liable to pay the debt or legacy or by his agent duly authorised in this behalf, a fresh period of limitation shall be computed from the time when the payment was made:Provided that, save in the case of payment of interest made before the 1st day of January, 1928, an acknowledgment of the payment appears in the handwriting of, or in a writing signed by, the person making the payment.
Essentials of valid acknowledgment under section 18:
- Existence of Liability: The acknowledgement must recognise a current liability owed to another party.
- Written and Signed Format: Oral acknowledgement is insufficient. The law requires it to be in writing and signed by the debtor or their authorised agent.
- Within the Limitation Period: Acknowledgement must occur before the expiration of the limitation period. If acknowledged afterwards, it won’t revive the claim or debt.
- Absence of Conditionality: Acknowledgement should be unqualified or absolute. While it doesn’t need to contain a promise to pay, the debtor must not set conditions for fulfilling the obligation.
Essentials conditions of section 19:
- – The payment must be made within the prescribed period of limitation.
- – It must be acknowledged by some form of writing either in the handwriting of a prayer himself or signed by him. If there is no acknowledgment in the required form, the payment by itself is of no avail.
- – The word “prescribed” means the period prescribed in the First Schedule, not the period within which the plaintiff may bring his suit.
- – The term ‘person liable to pay debt’ includes not only a person who is personally liable but also a person who is not personally liable but whose interest in the family property is liable.
Implications of Acknowledgement Under Section 18
The acknowledgement provisions under the Limitation Act offer several important implications:
- Protection for Plaintiffs: Plaintiffs who delay filing suits based on the defendant’s acknowledgement are given an extended opportunity to pursue justice.
- Discouraging Misuse of Limitation Defenses: By allowing a reset on the limitation period, the Act discourages defendants from exploiting the statute’s time-bar protections while still owing the debt.
- Business and Financial Dynamics: In commercial transactions, acknowledgement provisions encourage transparency and accountability, promoting financial clarity in cases of outstanding debts or delayed payments.
Challenges in Enforcing Section 18
While Section 18 aims to provide fairness, it has specific challenges:
- Determining Validity of Implied Acknowledgement: Courts often struggle with cases where acknowledgement is implied rather than explicit.
- Limited Applicability After Expiry: Acknowledgement only revives claims if made within the limitation period, posing challenges in cases of delayed discovery of debt.
- Balancing Defendant’s Rights: Courts must ensure that the debtor’s rights are protected against any abuse of Section 18 by plaintiffs who might allege acknowledgement falsely or without proper evidence.
RELEVANT CASE LAWS
State of Kerala vs TM Chacko
Facts: it is the arraignment case that speculating his mom would part with her whole profit to her 3 girls to his rejection, the litigant perpetrated this wrongdoing. It is the indictment case that despite the fact that the expired was set ablaze while she was sitting in a seat at around 10 a.m., no one saw the occurrence being referred to and it is just about 4.30 p.m. at the point when the terrific little girl of the perished, went to the house, she came to know about the occurrence. The indictment likewise asserts that at that point the concerned Police had gotten a mysterious call hinting of the episode being referred to as having been brought about by the expired child. Enrolling a case dependent on the said data in the overall journal, the Police likewise went to the place of the perished and discovered her truly copied, henceforth, took her to Kottarakkara emergency clinic where, the specialist, gave her primer treatment and recorded the injury endorsement wherein he noted as he is told by the expired that the injury endured by her was brought about by her child. It is likewise the situation of the indictment that the perished made a withering presentation who recorded the equivalent and got the thumb impression of the expired in which she explicitly expressed that it was her child who made the consume wounds her in view of the way that he presumed that the expired would not given him an offer in her profit. In spite of the fact that is supposed to be available at the hour of creation of the perishing revelation, he has not either confirmed that the expired was in a fit perspective to make the said announcement nor has he verified the said statement. From there on, it is expressed that exhorted the Police to take the expired to the Medical College Hospital at Trivandrum and when she was in effect so moved, she kicked the bucket in transit at around 7 p.m. on 28.7.1996. The court’s order depending on the said passing on announcement acknowledged the arraignment case and sentenced the litigant, as expressed previously.
Issue: The appellant in this case has been convicted by the Sessions Judge, Kollam, for an offence punishable under Section 302 IPC for having committed the murder of his mother Saramma on 28.7.1996 at about 10 a.m. at their house in Kottarakkara village by pouring kerosene on her and setting her ablaze.
Judgement: The Court states that there is no evidence is in support of the prosecution case. Moreover, it is an unsafe to place a judgment on the belief on the evidence that adduced by the prosecution to base a conviction. In addition, court states that the appeal succeeds the judgments and conviction of the courts below are set aside. The appeal is allowed. The appellant, if in custody and not required in any other case, shall be released forthwith.
PRESENT CASE:
Q. 5/2020. The suit is not barred by limitation since the original limitation extinguished when A signed the letter acknowledging the debt of Rs. 40,000 he owed to B on 24/3/2020. Thus, the new limitation period is from 24/3/2020 to 24/3/2023. B instituted the recovery suit on 20/6/2020 which is well within the limitation period.
