JUDGMENT : By way of instant appeal, the appellants have assailed judgment and decree dated 24.12.2008 passed by learned District Judge, Shimla in Civil Appeal No. 47-8/13 of 2008 whereby the judgment and decree dated 29.5.2008 passed by learned Civil Judge, Senior Division, Shimla in Civil Suit No. RBT-III/1 of 2005/01 was affirmed and the suit of the respondent herein was decreed. 2. The parties herein shall be referred to by the same status which they held before the learned trial Court. 3. Brief facts necessary for adjudication of the appeal are that the plaintiff filed a suit for recovery of Rs.2,41,387.17 against defendants on the premise that the plaintiff was running a business of auto parts under the name and style of M/s Himachal Auto Services and the defendants had been obtaining his services in the form of repair of vehicles and purchase of spare parts etc. It was alleged that defendant No.1 had an open cash credit mutual and running account with plaintiff. The payments made by defendants to plaintiff, from time to time, were duly credited in the account books maintained by plaintiff in regular course of his business. The debit entries were also regularly shown in such account books as and when the bills were raised by the plaintiff against the repairs of their vehicles or supply of spare parts etc. 4. The suit was filed on 05.04.2001. It was claimed in the plaint that the cause of action had arisen initially on 28.4.1992 when the open mutual cash credit account was opened by defendants with plaintiff. Plaintiff further relied upon a detail of amounts payable by the defendants to the plaintiff w.e.f. the financial year 1992-93. By adding the balance carried forward in each of the financial year w.e.f. 1992-93, a total sum of Rs.2,53,852.12 was claimed as payable. Plaintiff admitted to have received a sum of Rs.47,627/- and Rs.58,985/- from defendants on 31.3.1999 and 19.10.2000, respectively. After deducting the amount so received and after adding claimed interest at the rate of 18% per annum, the suit amount of Rs.2,41,387.12 was calculated. 5. The suit was contested by the defendants. The opening of cash credit open and mutual running account by the defendants with the plaintiff was specifically denied. After deducting the amount so received and after adding claimed interest at the rate of 18% per annum, the suit amount of Rs.2,41,387.12 was calculated. 5. The suit was contested by the defendants. The opening of cash credit open and mutual running account by the defendants with the plaintiff was specifically denied. It was submitted that the defendants placed orders in writing to the plaintiff for repair of their vehicles on need basis and payments were made in the regular course of business against the bills generated by plaintiff. As per defendants, the suit of the plaintiff was time barred as there was no open mutual and running account. Objection as to non-maintainability of the suit on account of want of notice under Section 392 of the H.P. Municipal Corporation Act was also raised. 6. On the pleadings of the parties, the learned trial Court framed the following issues : 1. Whether the plaintiff is entitled to recover from the defendants the suit amount along with interest at the rate of 18% per annum, as alleged ? OPP 2. Whether the plaintiff has no cause of action? O.P.D. 3. Whether the suit is barred by time? OPD 4. Whether the suit is barred by the provisions of Section 392 of the H.P. Municipal Corporation Act? OPD 5. Relief. 7. Issue No.1 was partly decided in affirmative and the suit of the plaintiff was decreed for a sum of Rs.1,47,240.12 alongwith interest at the rate of 9% per annum payable w.e.f. 19.10.2000 till realization of entire decretal amount. The learned lower Appellate Court also affirmed the findings returned by the learned trial Court and dismissed the appeal of the defendants. 8. This appeal was admitted on 04.12.2009 on following substantial question of law: “Whether both the Courts below incorrectly applied Article of the Limitation Act, 1963 to hold the claim in the suit as within limitation inspite of the fact that bills raised pertained to the period from 1992 to 1999? 9. I have heard learned counsel for the parties and have also gone through the records of the case carefully. 10. Noticeably, the suit amount included amounts pertaining to financial years 1992-93 onwards. Document Ext.PW-1/G as relied upon by learned trial Court provided the details of suit amount as under :- “Detail of year-wise amount: 1. 1992-93 2292.12 2. 1993-94 8335.00 3. 1994-95 7646.00 4. 1995-96 19375.00 5. 10. Noticeably, the suit amount included amounts pertaining to financial years 1992-93 onwards. Document Ext.PW-1/G as relied upon by learned trial Court provided the details of suit amount as under :- “Detail of year-wise amount: 1. 1992-93 2292.12 2. 1993-94 8335.00 3. 1994-95 7646.00 4. 1995-96 19375.00 5. 1996-97 35787.00 6. 1997-98 69331.00 7. 1998-99 111086.00 Total 253852.12 Amount received vide Ch.No.031976 dated 31.3.99 Without details of bills Balance 47627.00 2,06,225.12 Interest of above amount Total amount 94,147.00 3,00,372.12 Amount received vide Ch. No. 154427 dated 19.10.2000 58,985.00 Balance 2,41,387.12” 11. Issue No.3 was specifically framed as to limitation of the suit on the objection raised in the written statement. Even otherwise, it was for the plaintiff to have proved that the amount claimed in the suit was within limitation. 12. In order to prove his suit within limitation, plaintiff had alleged existence of an open mutual running account with the defendants with a purpose to take benefit of Article-1 of the Limitation Act, which reads as under : 1. For the balance due on a mutual, open and current account, where there have been reciprocal demands between the parties. Three years. The close of the year in which the last item admitted or proved is entered in the account; such year to be computed as in the account. 13. Learned trial Court held the existence of current, mutual and running account between the parties as proved. Learned lower Appellate Court also affirmed such findings. However, the findings so returned by both the Courts below cannot commend approval of this Court for the reasons firstly that the findings so returned on issue No.3 are without any reason and secondly, such findings were against settled position of law. It is trite law that in order to prove existence of open mutual running account, the party alleging such existence has to prove existence of the mutual obligations inter se the parties. 14. In Hindustan Forest Company vs. Lal Chand and others AIR 1959 SC 1349 , the Hon’ble Supreme Court has held as under : “7. “The question what is a mutual account, has been considered by the courts frequently and the test to determine it is well settled. The case of the Tea Financing Syndicate Ltd. v. Chandrakamal, ILR 58 Cal, 649 : (AIR 1931 Cal 359), may be referred to. “The question what is a mutual account, has been considered by the courts frequently and the test to determine it is well settled. The case of the Tea Financing Syndicate Ltd. v. Chandrakamal, ILR 58 Cal, 649 : (AIR 1931 Cal 359), may be referred to. There a company had been advancing monies by way of loans to the proprietor of a tea estate and the proprietor had been sending tea to the company for sale and realisation of the price. In a suit brought by the company against the proprietor of the tea estate for recovery of the balance of the advances made after giving credit for the price realised from the sale of tea, the question arose as to whether the case was one of reciprocal demands resulting in the account between the parties being mutual so as to be governed by Art 15 of the Indian Limitation Act. Rankin, C.J., laid down at p. 668 (of ILR Cal): a p. 368 of AIR), the test, to be applied for deciding the question in these words: "There can, I think, be no doubt that the requirement of reciprocal demands involves, as all the Indian cases have decided following Halloway, A.C.J., transactions on each side creating independent obligations on the other and not merely transactions which create obligations on one side, those on the other being merely complete or partial discharges of such obligations. It is further clear that goods as well as money may be sent by way of payment. We have therefore to see whether under the deed the tea, sent by the defendant to the plaintiff for sale, was sent merely by way of discharge of the defendant's debt or whether it was sent in the course of dealings designed to create a credit to the defendant as the owner of the tea sold, which credit when brought into the account would operate by way of set-off to reduce the defendant's liability." 8. The observation of Rankin, C.J., has never been dissented from in our courts and we think it lays down the law correctly. The observation of Rankin, C.J., has never been dissented from in our courts and we think it lays down the law correctly. The learned Judges of the appellate bench of the High Court also appear to have applied the same test as that laid down by Rankin, C.J. They however came to the conclusion that the account between' the parties was mutual for the following reasons: "The point then reduces itself to the fact that the defendant company had advanced a certain amount of money to the plaintiffs for the supply of grains. This excludes the, question of monthly payments being made to the plaintiffs. The plaintiffs having received a certain amount of money, they became debtors to the defendant company to this extent, and when the supplies exceeded Rs.13,000 the defendant company became debtors to the plaintiff and later on when again the plaintiff 's supplies exceeded the amount paid to them, the defendants again became the debtors. This would show that there were reciprocity of dealings and transactions on each side creating independent obligations on the other." 9. The reasoning is clearly erroneous. On the facts stated by the learned Judges there was no reciprocity of dealings; there were no independent obligations. What in fact had happened was that the sellers had undertaken to make delivery of goods and the buyer had agreed to pay for them and had in part made the payment in advance. There can be no question that in - so far as the payments had been made after the goods had been delivered, they had been made towards the price due. Such payments were in discharge of the obligation created in the buyer by the deliveries made to it to pay the price of the goods delivered and did not create any obligation on the sellers in favour of the buyer. The learned Judges do not appear to have taken a contrary view of the result of these payments.” 15. Similarly, in Kesharichand Jaisukhalal vs. Shillong Banking Corporation Ltd. Shillong AIR 1965 SC 1711 , the Hon’ble Supreme Court has held as under: “9. The next point in issue is whether the proceedings are governed by Art. 85 of the Indian Limitation Act, 1908, and if so, whether the suit is barred by limitation. Similarly, in Kesharichand Jaisukhalal vs. Shillong Banking Corporation Ltd. Shillong AIR 1965 SC 1711 , the Hon’ble Supreme Court has held as under: “9. The next point in issue is whether the proceedings are governed by Art. 85 of the Indian Limitation Act, 1908, and if so, whether the suit is barred by limitation. The argument before us proceeded on the footing that an application under s. 45(D) of the Banking Companies Act is governed by the Indian Limitation Act, and we must decide this case on that footing. But we express no opinion one way or the other on the question of the applicability of the Indian Limitation Act to an application under s. 45(D). Now, Art. 85 of the Indian Limitation Act, 1908 provides that the period of limitation for the balance due on a mutual, open and current account, where there have been reciprocal demands between the parties is three years from the close of the year in which the last item admitted or proved is entered in the account; such year to be computed as in the account. It is not disputed that the account between the parties was at all times an open and current one. The dispute is whether it was mutual during the relevant period. 10. Now in the leading case of Hirada Basappa v. Gadigi Muddappa, 6 Mad. H.C. 142 at p.144, Holloway, Acting C. J. observed: "To be mutual there must be transactions on each side creating independent obligations on the other, and not merely transactions which create obligations on the one side, those on the other being merely complete or partial discharges of such obligations." These observations were followed and applied in Tea Financing Syndicate Ltd. v. Chandrakamal H.R. 58, Cal 649: (AIR 1931, Cal. 359) and Monotosh K. Chatterjee v. Central Calcutta Bank Ltd. 91 Cal. LJ 16, and the first mentioned Calcutta case was approved by this Court in Hindustan Forest Company v. Lal Chand 1960-1 SCR 563: ( AIR 1959 SC 1349 ), Holloway, Acting C. J. laid down the test of mutuality on a construction of S. 8 of Act XIV of 1859, though that section did' not contain the words "where there have been reciprocal demands, between the parties". The addition of those words in the corresponding Art. 87 of Act IX of 1871, Art. 85 of Act XV of 1877 and Art. 85 of the Act of 1908 adopts and emphasises the test of mutuality laid down in the Madras case. 11. In the instant case, there were mutual dealings between the parties. The respondent Bank gave loans on overdrafts, and the appellant made deposits. The loans by the respondent created obligations on the appellant to repay them. The respondent was under independent obligations to repay the amount of the cash deposits and to account for the cheques, hundis and drafts deposited for collection. There were thus transactions on each side creating independent obligations on the other, and both sets of transactions were entered in the same account. The deposits made by the appellant were not merely complete or partial discharges of its obligations to the respondent. There were shifting balances; on many occasions the balance was in favour of the appellant and on many other occasions. the balance was in favour of the respondent. There were reciprocal demands between the parties, and the account was mutual. This mutual account was fairly active up to June 25, 1947. It is not shown that the account ceased to be mutual thereafter. The parties contemplated the possibility of mutual dealings in future. The mutual account continued until December 29, 1950 when the last entry in the account was made. It is conceded on behalf of the appellant that if the account was mutual and continued to be so until December 29, 1950, the suit is not barred by limitation, having regard to S. 45 (O) of the Banking Companies Act. The Courts below, therefore, rightly answered issue No. 1 in the negative.” 16. Reverting to the facts of the case, there is neither any factual foundation nor any material to prove the existence of mutual obligations between the parties. The simplicitor case of the plaintiff was that he was providing services of vehicle repairs and sale of spare parts to the defendants as per their orders and bills were being generated from time to time. Defendants were making part payments and the remaining balance was claimed by way of suit amount. Thus, the defendants were not having any obligation towards the plaintiff except to make payments for the services provided by him. Defendants were making part payments and the remaining balance was claimed by way of suit amount. Thus, the defendants were not having any obligation towards the plaintiff except to make payments for the services provided by him. In view of aforesaid exposition of law, the facts of instant case do not qualify the requirements of Article 1 of the Limitation Act. 17. In absence of the benefit of Article-1 of the Limitation Act, the suit of the plaintiff would fall under Article 18 which provided for a limitation of three years when the work was done. For clarity, the Article 18 of the Limitation Act is reproduced as under: 18. For the price of work done by the plaintiff for the defendant at his request, where no time has been fixed for payment. Three years. When the work is done. 18. Thus, the amount, if any, payable by defendants for the services availed or parts purchased during the period of three years immediately preceding date of filing of suit could be held to be within time. The relevant period would be 6.4.1998 to 5.4.2001. Perusal of Ext. PW-1/G reveals that during this period, a sum of Rs. 1,11,086/- was claimed as payable by defendants to the plaintiff. As per the admission of the plaintiff, he had received Rs.47,627/- and Rs.58,985/- on 31.3.1999 and 19.10.2000, respectively. This amount has not been shown to be paid against any specific bill. Thus, the plaintiff had failed to prove the liability of defendants to pay him any amount which could be said to be within the period of limitation. The findings on issue No.3, were thus clearly perverse. The substantial question of law as framed in the instant appeal is accordingly answered. 19. In result, the appeal is allowed. Judgment and decree dated 24.12.2008 passed by learned District Judge, Shimla in Civil Appeal No. 47-8/13 of 2008 affirming judgment and decree dated 29.5.2008 passed by learned Civil Judge, Senior Division, Shimla in Civil Suit No. RBTIII/1 of 2005/01, is set-aside and the suit of the plaintiff is dismissed with no order as to costs. Pending applications, if any, also stands disposed of.