KANTILAL DEEPCHAND MANIAR v. JAYANT T. JADHAV — 1961 DIGILAW 73 (GUJ)

V. B. RAJU, J. ( 1 ) THIS is a first appeal against the judgment of the learned Civil Judge Senior Division Surendranagar in Civil Suit No. 9 of 1955 by the original plaintiff who filed a suit to recover Rs. 18 500 together with costs and interest against two defendants namely the Honorary Secretaries of the Anti-Tuberculosis Hospital and Parin Banu Anti-Tuber- culosis Clinic Association. ( 2 ) THE plaintiff was serving as the Chief Medical Officer of the hospital of the defendant Association and he alleges in the plaint that the defendants had relieved him from service from 28-2-1954 He claimed Rs. 23 560 as arrears of pay from 1-9-51 to 31-5-54 at the rates varying from Rs. 650 per month to Rs. 750. 00 per month. After giving credit for Rs. 5 499 received by him by a cheque from the defendants and a sum of Rs. 101. 00 which he had to pay to the Association as donation he claimed Rs. 18 500 According to the plaintiff he was entitled to monthly pay at the rates varying from Rs. 650. 00 to Rs 750/- under a contract. There is no specific reference of a written contract in any of the paragraphs of the plaint but it is admitted by both sides that there was a written agreement between the parties dated 15-2-48 which is at Ex. 52. It is rather surprising that a suit based on a contact makes no reference to the written contract. ( 3 ) IN the written statement the defendants contended that the suit purported to be based on a document dated 15-2-48 but as the contract came to an end on 30-9-51 and as the suit purported to be based on the said document the suit as framed and based was not maintainable. It was also contended that clause (1) (b) of the said agreement fixing the grade of pay at Rs. 500-50-750 was not to be enforced and the time for enforcement had not also come. The written statement also referred to certain payments made by cheques and it was contended that the suit should be dismissed. . . . . . . . . . . . . . . . . . . . . . . . . . . . The written statement also referred to certain payments made by cheques and it was contended that the suit should be dismissed. . . . . . . . . . . . . . . . . . . . . . . . . . . . ( 4 ) IT is not contended in the written statement that the terms of the agreement were not to be acted upon. What the defendants pleaded in the written statement was that clause 1 (b) of the agreement was not to be enforced until the financial condition of the association was to be improved. Evidence can be given to prove that the contract was not to be acted upon but no evidence can be led to show that one or some of the terms of the agreement were not to be acted upon. It is however open to the parties to show that the promise had dispensed with or remitted wholly or in part the performance of the promise made to him as provided in section 63 of the Contract Act. But this is not the case made out in the written statement. It is true that in para 3 of the written statement it is contended that the plaintiff by his conduct had accepted Rs. 400. 00 as monthly pay. But this pleading was qualified by the statement that by so accepting Rs. 400. 00 as monthly pay the plaintiff had accepted that the time for enforcement of clause 1 (b) of the said agreement had not arrived and that the plaintiff had acted on the basis that the said agreement was not to be enforced upon. Under the contract the defendants were to pay the salary every month. The promise was therefore to be fulfilled every Month. It was open to the defendants to prose under section 63 of the Contract Act that the promise namely the plaintiff had in a particular month or some particular months or in all the months for which salary was paid dispensed with the payment of the salary in full and had accepted the salary in part. But he cannot lead evidence to show that the terms of the contract were varied. . . . . . . . . . But he cannot lead evidence to show that the terms of the contract were varied. . . . . . . . . . ( 5 ) ON 1-10-51 under the agreement if the agreement had been in force the plaintiff would have been entitled to a salary of Rs. 650. 00. We take this as reasonable basis of the compensation payable to the plaintiff under section 70 of the Contract Act. ( 6 ) THE suit was however filed on 28-2-55 and having in view the period of limitation of three years the plaintiff would be entitled to salary only for the period from 1-2-52 to 28-2-54. For this period at the rate of Rs. 650. 00 per month the plaintiff would be entitled to Rs. 16 250 as reasonable compensation under section 20 of the Contract Act. But admittedly the plaintiff had been paid Rs. 5 600 for the period from 1 to 28-2-54 and deducting this amount of Rs. 5 600 the plaintiff would be entitled to Rs. 10 650 But it is contended that the defendants had made two payments to the plaintiff by cheques namely Rs. 4 600 dt. 2-5-53 and Rs. 3400. 00 dt. 26-5-53. It is contended that these two amounts should also be deducted from the amount payable under sec. 79 of the Contract Act. But at the time when these payments we made it is admitted that no covering letter was sent with the cheques It is the case of the plaintiff that he had appropriated these amounts towards the amount of his salary due to him for the period prior to 1 For that period he had been paid at the rate of Rs. 400. 00 only and under the terms of the agreement he was entitled more in the grade of Rs. 500-50-750. For the period from 1-7-48 to 1-10-51 the plaintiff would be entitled to an additional sum of Rs. 8 150 It is contended by the plaintiff that the amounts of two cheques totalling Rs. 8 0 were appropriated towards the amount of Rs. 8 150 due to him. 500-50-750. For the period from 1-7-48 to 1-10-51 the plaintiff would be entitled to an additional sum of Rs. 8 150 It is contended by the plaintiff that the amounts of two cheques totalling Rs. 8 0 were appropriated towards the amount of Rs. 8 150 due to him. ( 7 ) SECTION 61 of the Contract Act reads as follows:-WHERE neither party makes any appropriation the payment shall be applied in discharge of the debts in order of time whether they are or are not barred by law in force for the time being as to the limitation of suits. If the debts are of equal standing the payment shall be applied in discharge of each proportionally. ( 8 ) IN view of this section if neither party makes any appropriation the payment shall be applied in discharge of the debts in order of time whether they are or are not barred by the law in force for the time being as to the limitation of suits. After 1-10-51 the amount payable under sec. 70 of the Contract Act as reasonable compensation would not be a debt due to the plaintiff and the only debt due to the plaintiff is arrears of pay under the terms of the contract (Ex. 52) and in view of section 61 of the Contract Act the amount paid will have to be appropriated towards the earlier debt. It is conceded that before the filing of the suit neither party had appropriated Rs. 8 0 except as stated in the counterfoils of the cheques which are signed by the President who has not been examined in the suit. The President is also not a party to the suit. In this view the counterfoils cannot be looked at. There is therefore no evidence to show that either party had appropriated the payment made by these two cheques towards the amount payable under sec. 70 of the Contract Act. ( 9 ) IT is also contended by the learned counsel for the appellant that even the amount payable for the period before 1-2-1952 has to be decreed in the suit because there has been an acknowledgment. He refers to the acknowledgment by two cheques one of Rs. 46 0 dt. 2-5-53 and another of Rs. 3 400 dt. 26-5-55 as saving limitation. He refers to the acknowledgment by two cheques one of Rs. 46 0 dt. 2-5-53 and another of Rs. 3 400 dt. 26-5-55 as saving limitation. Limitation is said to be saved on account of payment made by the defendants to the plaintiff. In the case of payment the relevant section is sec. 20 of the Limitation Act which reads as follows: (1) 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 duly authorized agent a fresh period of limitation shall be computed from the time when the payment was made. Provided that save in the case of a 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 ( 10 ) THIS section only deals with payment on account of debt or of interest on legacy. In the instant case the amount payable under section 70 of the Contract Act as reasonable compensation cannot be considered as debt of a specific or ascertained amount. In this view sec. 20 of the Limitation Act can have no application and the two cheques cannot be said to have saved limitation. Section 20 would apply where there is a particular debt or interest on a legacy. In this case the salary for every month is different from the salary of another month and therefore section 20 of the Limitation Act has no application. We therefore reject the appellants contention that under section 70 of the Contract Act reasonable compensation should also be made for the salary prior to 1-2-1952. ( 11 ) NOW we turn to the cross-objection which relate to the decree of the lower Court decreeing Rs. 1 200 as pay for notice period of three months. As already observed the plaintiff is entitled only to a reasonable compensation under section 70 of the Contract Act in respect of the service for the period during which he served in the hospital. Three months notice would be for a period subsequent to the termination of the services and therefore would not come within the scope of section 70 of the Contract Act. Three months notice would be for a period subsequent to the termination of the services and therefore would not come within the scope of section 70 of the Contract Act. The plaintiffs is not therefore entitled to three months notice or to salary for three months under the provisions of sec. 70 of the Contract Act. We therefore disallow this amount and the plaintiff would not be entitled to Rs. 1 200 but as already held the plaintiff is entitled to Rs. 10 650 appeal allowed. .