1. ' This appeal is directed against the judgment dated 12-3-1978, of Mr. Abdul Aziz Memon, the then V Additional District Judge, Karachi whereby he accepted the appeal of respondent Habib Bank and remanded the case to the lower Court for disposal according to law. The facts giving rise to the appeal may be briefly stated as under:- Habib Bank had filed this suit against the appellant for recovery for Rs,5,884. The respondent had opened a letter of credit at the request of the appellant in their favour in 1968 for import of goods from Warsaw, against a margin of Rs,1,000. Accordingly the goods were shipped and the documents for the sum of Rs,5,000 were received by the Bank and payment thereof was made on 24-12-1968. The appellant failed to pay the amount for the retirement of the documents. There was correspondence between the parties for payment of the amount and finally on 5-3-1975 following note was handed over by the appellant to the respondent.
2. ' To ' The Manager, ' Habib Band Ltd., ' Foreign Exchange Branch, Habib Square, Karachi.
3. ' L/C No,2403, Bill No,5961, A/c Hussain Corpn. Ltd. Sir, ' I had talk with Mr. Saeed Abbas, Officer of your Bank, I undertake the sum of Rs,25 per month being the instalment against my above bill, will be deposited in your Bank, as I cannot pay the lump sum amount. Further, I may state that I cannot pay any interest, the first instalment will be paid by 10th March, 1975.
4. ' Thanking you, ' Yours faithfully, ' for Hussain Corporation Ltd.
5. (Sd.)
6. (Muhammad Yawar Hussain)
7. ' It was followed by another letter dated 10-3-1975 which runs as under:- ' To ' The Manager Habib Bank Ltd., Foreign Exchange, Karachi.
8. ' Subject: Pay Order No,904846 or Rs,25. Dear Sir, ' We are herewith enclosing the above-referred pay order being the installment against my ' ' 'Bill No,5961 I/C No,NBP-2403,. Please acknowledge the receipt on the duplicate copy.
9. ' Thanking you, Yours faithfully, for Hussain Corporation Ltd.
10. (Sd.)
11. (M.Y. Hussain)
12. ' The appellant deposited two instalments of Rs,25 per month for March and April, 1975 in furtherance of the said letter but failed to pay any further amount. The appellant had a sum of Rs,1,742 lying to the credit of respondent in another account whcih was adjusted by the appellant leaving a balance of Rs,2,210 as due against the respondent. The respondent having become sure that the loan will not be repaid, filed Suit No,664 of 1976 against appellant for recovery of the principal amount together with Rs,3,674 by way of interest at 13% P.A.
13. ' The appellants contested the suit and pleaded that it was time-barred. They also alleged that the respondent had committed breach of contract with the result that imported goods were auctioned by the K.P.T. The learned Civil Judge agreed with the contention of the appellant and came to the conclusion that the suit was time-barred and, therefore, dismissed the same on this preliminary issue. The respondent went in appeal against the judgment of the learned Civil Judge. The Additional District Judge allowed the appeal as he came to the conclusion that the suit was not barred by limitation. Hence, he remanded the suit to the lower Court, for trial on merits, against which this appeal has been filed.
14. ' I have heard Mr. M.I. Siddiqui, Advocate, for the appellants. There was no appearance on behalf of the respondent.
15. ' Section 25(3) of Contract Act makes it quite clear that a promise to pay a time-barred debt is valid. It will be useful to reproduce the relevant provision: "25. An agreement made without consideration is void, unless;- (1()
16. (2)
17. (3)
18. ' It is a promise, made in writing and signed by the person to be charged therewith, or by his agent generally or specially authorised in that behalf, to pay wholly or in part a debt of which the creditor might have enforced payment but for the law for the limitation of suits.
19. ' In any of these cases, such an agreement is a contract."
20. ' Mr. ' M.T.Siddiqui, who appeared for the appellant relied upon PLD 1959 Kar. 348, where it was held that if the promise to pay time-barred debt is conditionally dependent on the happening of certain event, it is the duty of the plaintiff to prove that the said event had happened, failure to prove it was fatal for the plaintiff. This ruling does not apply to the facts of the present case at all. In the case under ruling the debtor had promised to pay the amount if he succeeded in a suit which was to be filed against them. This is not the position in this case. The promise is not conditional, so far as the payment of the principal amount is concerned except that it will be paid in instalments. The payment of installments is not such a fact the happening of which was uncertain or required proof.
21. It is, therefore, quite clear that the above ruling was not in any way applicable to the present case.
22. ' There can be no dispute with regards to the legal proposition that a promise to pay a time-barred debt construed the renovation, on which a suit can be based independently of the original debt.
23. Reference in this connection may be made to AIR 1932 Lah. 212 (D.B.). Similar view was taken in AIR 1929 All. 657 (D.B.) where it was held that a time-barred debt can form a, good consideration because legally speaking such a debt is not exsitinguished although the remedy to recover it by means of the suit is lost. Similar view has also been taken by this Court in PLD 1977 Kar. 521 where it was held that although the suit was factually barred by time yet on the basis of promise to pay the time-barred debt it becomes within time.
24. ' The learned Additional District Judge also took into consideration as to whether the documents referred to above would form a contract. He came to the conclusion that the documents renovated the contract within the meaning of section 25(3) of the Contract Act. He assigned good reasons for the above conclusion fortified with a citation from PLD 1968 Dacca 260 to the following effect.
25. "The requirement of the Section is not that the promise itself must be in express terms but that such promise should be deducible from a written and signed document. It is clear that without written words and the signature of the promisor, there cannot be a contract within the meaning, of the said section but if the words used in writing do mean a promise to pay, or if from the said words a clear intention to pay can be inferred, then the requirement of section 25(3) of the Act is fulfilled. If the written document is signed, the attending circumstances can be used to construe the meaning of the words themselves."
26. ' I am also of the clear view that the fact that the appellant had refused to pay interest does not make the promise to pay the principa amount in effective. It is however open to the Trial Court to examine as to what amount the appellant is liable in view of the contract s renovated.
27. ' Hence, I dismiss the appeal and uphold the judgment of the learned Additional District Judge. The costs of this appeal will follow the costs in the final event.