VALIDITY OF ACKNOWLEDGEMENT
TRIBHUVAN PUROHIT
(Querist) 15 June 2011
This query is : Resolved
Can acknowledgement be valid wherein time barred statements are relied, what are the basic requirements which should have in a letter of acknowledgement ?
Regarding Limitation :-
Time barred statement relied in the acknowledgement can be and can it be a valid or what should be consequences
In above queries can bank rely on such acknowledgement and take orders
TRIBHUVAN PUROHIT
PALNITKAR V.V.
(Expert) 15 June 2011
If the acknowledgment clearly admits the liability towards a time barred claim with promise, that should hold good for extension of time limit. Banks can rely on such acknowledgment.
Advocate Bhartesh goyal
(Expert) 15 June 2011
As per Sec.18 of Limitation Act,the acknowledgement must be in writing and within limitation period.Hence acknowledgement of time barred claim has no relevance therefor not valid before eye of law.
PALNITKAR V.V.
(Expert) 16 June 2011
What happens if the borrower specifically admits his liability to pay the time barred debt and promises to pay it also. Will it not be covered by Sec. 25 of Contract Act
TRIBHUVAN PUROHIT
(Querist) 16 June 2011
Sir,
I would like Advocate Bhartesh Goyal Specially to have his reply.
Please let me know the following.
When can be a letter of acknowledgement be called valid document in the court of law.
A time barred statement is relied in the court and Respondent having 1 Bank Account, Petitioner relying on 3 statements, can this Letter of Acknowledgement be called valid document
Awaiting earliest reply.
Advocate Bhartesh goyal
(Expert) 17 June 2011
{1}when the letter of acknowledgement is written by the person before expiry of limitation period admitting the liability or debt, it would be valid acknowledgement.
{2}No it is not valid document and limitation can not be extend by such document.
J K Agrawal
(Expert) 19 June 2011
Thanks to Mr Bhartesh Goyal. The acknowledgement should be within period of limitation.
But what about s 25 of Contract act?
If the time barred loan is admitted in writing and there is an specific promise to pay the amount in future then it becomes a valid contract. Time barred loan is good consideration for promise. It becomes a fresh contract and legally enforceable by law. This deed provides a fresh cause of action. The person filling suit need not to prove or plead previous contract not cause of action arises from previous Loan agreement.
M V Gupta
(Expert) 19 June 2011
I agree with Mr. JK Agarwal. But what does the querist mean when he states that a time barred statement is relied in the court? Does that document satisfy the provisions of Sec 25 of Contract Act? Unless one sees the document in question no clear opinion can be tendered.
PALNITKAR V.V.
(Expert) 20 June 2011
It ultimately means that even if a debt is time barred its acknowledgement coupled with a promise to pay is enough to start limitation afresh in view of Sec. 25 of Contract Act. But if it not coupled with promise, the acknowledgment is useless for extension of limitation
