1. MUHAMMAD YAQAB ALI, J.-These two appeals arise out of the suit filed by Abdul Latif respondent against M/s. M. G. Kadir & Co., appellant, a firm carrying on business of Exporters and Importers at Karachi, for the recovery of Rs.27,197-8-0. The sum claimed consisted of Rs. 20,500, as principal amount and Rs.6,697-8-0 as interest at the rate of 6 % per annum from 31-8-1949 the date on which the loan was advanced by the respondent to the appellant to the 30th August 1952 the date of the suit.
2. This suit was dismissed on the 21st April 1951 by a learned Judge of the erstwhile High Court of West Pakistan Karachi Bench for non--appearance of the plaintiff. The respondent thereupon filed an application for restoration of the suit which was rejected on 11-1-1960. On further appeal the Letters Patent Bench of the High Court, however found sufficient cause for non-appearance of the plaintiff and restored the suit on 21-1-1964 with the direction that it should be tried and disposed of on merits in accordance with law.
3. Aggrieved by the order of restoration the appellant filed an application before the High Court under section 109, C. P. C. For grant of a certificate to appeal to this Court. While these proceedings were pending the learned Single Judge on 1-7-1964 decreed the suit against the appellant with future interest at the rate of 6% per annum till payment. An appeal against the judgment and decree was pending before the Letters Patent Bench when certificate of fitness was granted on the basis of the value of the subject-matter of the suit and the variation of the judgment and decree passed by the learned Single Judge.
4. Civil Appeal No. K-58 of 1965 has been brought on the basis of the certificate of fitness against the judgment and order passed by the Letters Patent Bench dated 21-1-1964 restoring the suit. The further appeal filed by the appellant from the judgment and decree passed by the learned Single Judge for recovery of the suit amount was dismissed by the Letters Patent Bench on 8-11-1968.
5. Leave to appeal was granted in this case on 19-8-1970 to consider only the issue of limitation arising in the suit.
6. As the suit has been tried and decided on merits during the pendency of Civil Appeal No. 58 of 1965 and the subject-matter of the suit is in appeal before us we did not consider it profitable for the learned counsel for the appellant to address us on the merits of the order of restoration of the suit.
7. The order was passed in substantial aid of justice and this Court could not be easily persuaded to interfere with such an order. This however does not mean that the reasons given by the learned Judges of the Letters Patent Bench for restoration of the suit do not find our agreement. We would accordingly dispose of this appeal on the principle that an order passed by the High Court in the exercise of its discretionary jurisdiction restoring a suit, an appeal or an application dismissed in default does not ordinarily call for interference by this Court.
8. On 13-7-1948 the respondent advanced a loan of Rs.45,500 to the appellant out of which the latter paid back Rs. 25,000 on 31-8-1949 leaving a balance of Rs.20,500. Limitation to sue for its recovery would have expired on 30-8-19.72 but it was claimed by the respondent that there was an extension of limitation to sue under section 19 of the Limitation Act. Reliance was placed on the acknowledgment of debt contained in the letter Exh. P. 10 written bylate M. G. Kadir to the respondent on 19-6-1952.
9. The appellant in its written statement denied that any such acknowledgment was made and it was contended that the suit was liable to be dismissed as barred by time. It was not denied that the letter Exh. P. 10 was written by M. G. Kadir. The decision of question depends upon the meanings to be given to the words used in the letter Exh. P.
10. It will be advantage us to reproduce the provisions of section 19 of the Limitation Act before we proceed to examine the contents of this letter: "Section 19.-Where before the expiration of the period prescribed for a suit or application in respect of any property or right, an acknow--ledgment 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 -------- ----a fresh period of limitation shall be computed from the time when the acknowledgment was so signed.
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10. Explanation 1.-For the purposes of this section an acknowledgment may be sufficient though it is accompanied by a refusal to pay, deliver, perform or permit to enjoy, or is coupled with a claim to a set off The primary ingredient of this section is admission of an existing liability and jural relationship of debtor and creditor. Cases in which words used in the writing are ambiguous or in which admission is to be ascertained from words which are veiled in appearance but their meanings can be spelt out with reference to extraneous facts may present difficulty. The case before us is however quite simple. The learned Judges of the High Court have referred to a large number of decided cases on the meanings and scope of section 19 of the Limitation Act but we have refrained from examining these cases as in our opinion the issue of limitation arising in this case can be satisfactorily decided by referring mainly to the two letters of demand written by the respondent and the reply thereto by M. G. Kadir.
11. The respondent sent to M. G. Kadir two letters of demand for payment of two separate sums. One sum was claimed as balance of the loan advanced to the latter in personal account and the other as respondent's share of the joint business for the preceding year. The reply to these letters is Exh. P.
12. 10 which contains the acknowledgment on which the respondent relied for extension in the period to sue for recovery of the first sum.
13. The text of the letter Exh. P. 10 will be understood properly if we first refer to the letters of demand Exhs. P. 23 and P. 24 which are to the following effect.
14. "Registered A. D. Dated 19th March 1952 My dear Kadir Sahib.
15. It is with some feeling and surprise at the attitude adopted by you that I am obliged to address this letter to you. I. Advanced you a total amount of Rs.45,500, as loan in July 1948 you paid Rs.25000.
16. Only about a year after the loan. The balance of Rs. 20,500. Remains till this day. Over and above this amount, there is a sum of Rs. 44,231-12-9 due to me from you on account of the partnership in the Cotton Ginning and Pressing Factories at Mahrabpur and Hyderabad. 1 assure you that I will be the last person to have unpleasantness between you and me but I request you to realise my difficulties which are immense and have arisen out of the loses suffered this year. I have been running to your place time after time as you called me for the payments of the said amounts. Early this month you asked me to contact you in three or four days time for payment of the amounts, but when I went to see you at your residence on Sunday the 9th March 1952, you did not come out though you sent words asking me to wait. I waited there for about 45 minutes.
17. I will again request you to put your self in my position and realize what difficulties, worries and feelings you will have in the circumstances I am in and the manner in which I behaved with you.
18. M. G. Kadir Esq.Yours sincerely, Safe Deposit Chambers,(Sd.) Abdul Latif.
19. Mcleod Road, Karachi.
20. MOMININ CORPORATION Registered A. D.
21. RAMBAGH ROAD, Karachi, Dated 6th June 1952.
22. My dear Kadir Sahib, By a letter dated 19-3-52 I requested you to make payments of the following items due to me from you:-
(a) Rs. 20,500 outstanding against you in respect of the loan of Rs. 45,500. Given to you; and
(b) Rs. 44,234-12-9 due to me from you on account of the partnership in the Cotton Ginning & Pressing Factories at Mahrabpur and Hyderabad.
2. On having received no reply to my letter. I saw you along with Mr. Ajaz and Mian Mohammad Rafi.
23. You said that you had then not ready money with you to pay me and asked for the deduction of the following amounts from item (b) for car Rs. 32,2-10, for Income-tax Rs. 22,000.
3. I agreed to the said deductions you asked me to wait sometimes. More for payment of the sums due to me and suggested that mean--while I should send my accountant to explain the accounts of the partnership business once again. This was also done long ago.
24. I will be greatly obliged if you will make the payments of both the items now as I am badly in need of money. I hope you will have due regard to my urgent need and settle the payments in full.
25. With my best regards.
26. Yours sincerely, (Sd.) Abdul Latlf.
27. M. G. Kadir Esq.
28. Safe Deposit Chambers, McLeod Road, Karachi.
29. WP.10. We will now set out the text of the letter Exh. P. 10, whi, was written by M. G. Kadir in reply to the above two letters.
30. Tele. (Office 4066)
31. (Res: 7543)
32. M. G. KADIR & CO. IMPORTERS & EXPORTERS Safe Deposit Chambers, McLeod Road, Karachi (Pakistan).
33. REGISSTRED A/D The Hyderabad Cotton Mill.
34. The Hyderabad Cotton Press.
35. The Mahrabpur Cotton & Oil Mills.
36. The Kadir Steel Works.
37. Ref. No. 2051Dated 19th June 1952.
38. My dear Latif Sahib, I am rather surprised to receive your letter dated 6th June 1952 to which I could not reply earlier on account of my illness.
39. You are no doubt correct in stating that there is a credit balance of Rs. 20,500, in your personal account in my books, but I failed to understand as to how you arrived at the figure Rs. 44,234-12-9 as due to you on account of the partnership in the cotton ginning and pres--sing factory at Mehrabpur and Hyderabad.
40. You are no doubt aware that the Hyderabad account books which are with Mr. Ajaz Hussain, brother of late Mr. Zahid Hussain, have not been shown to me at any stage nor have I seen an audit report in respect of these accounts. However, according to the returns and statement filed at the Income-tax Office in regard to their business the not profit has been shown as under:- Hyderabad Cotton Ginning Factory Rs. 48,571-10.0 Hyderabad Cotton Press. Rs. 9,759-7.0 The same remarks as above apply in respect of Mehrabpur accounts which are in your possession.
41. The statement filed by you in the Income-tax Office shows that this business resulted in a loss of Rs.
42. 52,212-4-6. In view of these figures which I accepted for the time being, I fail to see by what process of calculation and reasoning you arrived at the conclusion that Rs. 44,234-12-9 were due to you on account of these partnerships.
43. You have already been furnished with the copies of Mehrabpur and Hyderabad Mills accounts appearing in my books which have already been duly checked by you and your representative, from which it is clear that there is a credit balance of Rs. 7478-12-3 in Hyderabad account, and a debit balance of Rs. 51,181-7-3 in Mahrabpur account. There is a not debit balance of Rs. 43,712-11-0.
44. These balances have been arrived at after ignoring the lease money of Rs. 50,000, for each factory which we have forgone merely in deference to your wishes.
45. With kind regards.
46. Yours sincerely.
47. (Sd.) M. G. Kadir.
48. Khan Sahib Abdul Latif C/o Mominin Corporation Rambagh Road, Karachi.
49. It appears from the letters reproduced above that late M. G. Kadir and Abdul Latif were partners in a cotton business carried on at two different places. The demand made by the respondent in Exh. P.
50. 28 and P. 24 was two-fold: (i) payment of Rs. 20,500, as balance of Rs. 45,500 advanced by him as personal loan to M/s. M. G. Kadir & Co. And (ii) Rs. 44,234-12-9 as his share of the profit of the business jointly carried on by the parties during the preceding year. The sentence "you are no doubt correct in stating that there is a credit balance of Rs. 20,500. In your personal account in my books", occurring in the first part of the letter Exh. P. 10 contains an unequivocal acknowledgment of an existing liability in favour of the respondent to whom the letter is addressed. The appellant however relied on the sentence "In the light of the above facts, it will be seen that the not position would be a debit balance against you and not a credit balance in your personal account as you appear to believe." occurring in the concluding part of the letter. If the two sentences are read together they mean "I owe you Rs. 20,500, on account of the balance of the loan advanced by you in personal account but you will be owing me even a larger amount when account of the losses incurred by the joint business is taken." It should be noticed that no account had been taken till then. This becomes explicit by the sentence "I would therefore again request you to please go through the relevant accounts and settle the matter as early as possible."
51. The learned counsel for the appellant maintained that Exh. P. 10 does not contain an acknowledgment of an existing liability on the part of the appellant to pay Rs.20,500 to the respondent as the demand was repudiated in the concluding part of the letter reproduced above.
52. The contention raised is fallacious. At best the appellant was claiming a set-off though in fact accounts of the joint business had yet to be taken. Even if the latter is construed liberally in favour of the appellant as was contended by the learned counsel and it is found that M. G. Kadir had claimed a set-off. Explanation I to section 19 of the Limitation Act saves the effect of the acknowledgment contained in the opening part of the letter.
53. To conclude, the letter Exh. P. 10 written on that 19th June 1952 by M. G. Kadir contained an unequivocal admission of an existing liability to pay to the respondent Rs. 20,500. The period of limitation to bring the suit for recovery of the amount was consequently extended under section 19 of the Limitation Act for three years from the date on which that letter was written. The suit filed by the respondent on 5-9-1952 was therefore well within time.
54. Both the appeals are accordingly dismissed but the respondent- shall have his costs only in the Second Appeal No. C. A. K-32 of 1972.