JUDGMENT : Jyotsna Rewal Dua, J. A civil suit for recovery of Rs.69,000/- alongwith costs and interest was decreed by the learned Trial Court on 07.04.2015. The decree was reversed by the learned First Appellate Court on 15.10.2015 on the ground that suit for recovery of money was barred by limitation. Aggrieved, the plaintiff has taken recourse to Section 100 of the Code of Civil Procedure. This appeal was admitted on 05.07.2016 on the following substantial question of law:- “(a) Whether the First Appellate court has erred in holding that Limitation Period has expired to file the suit for recovery by plaintiff when defendant has specifically made acknowledgment for time barred debt by way of agreement which is valid as per Section 25(3) of the Indian Contract Act.” 2. The case 2(i) Suit was filed by the appellant on 01.06.2009 with the pleadings that:- The plaintiff deals in shuttering plates etc. for the purpose of construction of lintel; The defendant requested him for hiring 30 shuttering plates @ Rs.1.50 per plate on 01.04.2003; The plaintiff supplied 30 shuttering plates to the defendant accordingly; Defendant did not pay single paisa to the plaintiff; He returned only 7 (sic 9) out of 30 shuttering plates; The defendant did not pay any heed to the plaintiff’s repeated requests for returning the remaining shuttering plates and for paying the rent in lieu thereof; On 12.11.2007, an agreement was executed between the plaintiff and the defendant whereunder the defendant agreed to pay Rs. 25,000/- in lumsump towards rent of shuttering plates and also agreed to return 21 remaining shuttering iron plates hired by him in April 2023, dimensions of the shuttering plates were also mentioned in the agreement; Mode and modalities of payment of Rs.25,000/-was also given in the agreement; The defendant did not abide even by the terms and conditions of the agreement dated 12.11.2007; He neither paid the rent nor returned the remaining 21 shuttering plates, hence, the suit. 2(ii) In his written statement, the defendant inter-alia took the preliminary objection of civil suit being barred by limitation. 2(ii) In his written statement, the defendant inter-alia took the preliminary objection of civil suit being barred by limitation. On merit, his stand was that:- He being an iron smith deals in shuttering plates for the purpose of construction of lintel; He had not hired any shuttering plate from the plaintiff; Plaintiff and his relative Hitender alias Pappa had come to defendant’s work site and forcibly took away 9 shuttering plates; These shuttering plates were not returned by the plaintiff despite defendant’s requests; Upon this, the defendant reported the matter at Police station Chamba; Subsequently, the plaintiff alongwith his relative Pappa pressurized the defendant for withdrawing the complaint and to settle the matter or else he was threatened that he would not allowed to execute any construction work; The plaintiff had per-force obtained signatures of the defendant on some papers; The defendant had not executed any agreement on 12.11.2007 in plaintiff’s favour for paying Rs.25,000/- in lumsump as rent of the shuttering plates; Agreement dated 12.11.2007 is false, fabricated and result of fraud. The stand of the defendant was that the agreement dated 12.11.2007 was prepared by the plaintiff in connivance with scribe and witnesses in absence of the defendant. The agreement was void and not binding upon the defendant. 2(iii) The parties led evidence in support of their respective contentions. The plaintiff produced two witnesses apart from examining himself as PW-1. Plaintiff also proved on record the agreement dated 12.11.2007 as Ext.PW-2/B. Defendant stepped in the witness box as DW-1. No documentary evidence was adduced by the defendant. 2(iv) Learned Trial Court after considering the entire material found substance in plaintiff’s case. Plaintiff’s assertion of having rented out 30 shuttering plates to the defendant was held to be demonstrated on record. The execution of agreement dated 12.11.2007 was also proved on record. Defendant’s non-compliance to the terms agreed between the parties on 01.04.2003 and to the covenants of agreement dated 12.11.2007, was also held established. In view of promise of the defendant in the agreement dated 12.11.2007 to pay the debt, the suit was held to be within limitation in terms of Section 25 of the Indian Contract Act. The suit was accordingly decreed on 07.04.2015. In view of promise of the defendant in the agreement dated 12.11.2007 to pay the debt, the suit was held to be within limitation in terms of Section 25 of the Indian Contract Act. The suit was accordingly decreed on 07.04.2015. 2(v) Defendant’s appeal against the aforesaid judgment and decree was allowed by the learned First Appellate Court on 15.10.2015 inter alia holding that:- Transaction had taken place on 01.04.2003; Limitation period of filing recovery suit was three years; Agreement executed in the year 2007 had no connection with the transaction that took place in the year 2003; Limitation period for recovery of rent of shuttering plates had expired on 31.03.2006; At the time of execution of the agreement, no transaction had taken place. Learned First Appellate Court, thus, held that the agreement dated 12.11.2007 was not executed within the prescribed period of limitation and, therefore, suit of the plaintiff was barred by Section 18(1) of the Limitation Act. It is in the aforesaid circumstances, plaintiff has preferred instant regular second appeal. 3. Heard learned counsel for the parties and considered the entire record case. 4. Findings The sole question of law on which this appeal was admitted pertains to whether limitation period for filing the suit had expired for the plaintiff or whether the suit filed was saved by Section 25(3) of the Indian Contract Act. Following factors are relevant for deciding the substantial question of law:- 4(i) Transaction dated 01.04.2003 and the Agreement dated 12.11.2007. 4(i)(a) Suit was instituted by the appellant for recovery of money with the pleadings that he had rented out 30 shuttering plates to the defendant on 01.04.2003 @ Rs.1.50 per plate; Defendant neither returned the shuttering plates nor paid the agreed rent; After much persuasion, defendant returned only 9 shuttering plates; On 12.11.2007, the parties executed an agreement settling the mode and modalities for returning the remaining 21 shuttering plates and for paying Rs.25,000/- as lumsump amount towards rent thereof. The Defendant did not abide by the terms and conditions of this agreement as well. According to the plaintiff, the cause of action arose initially on 01.04.2003, when the shuttering plates were rented out to the defendant and thereafter on 12.11.2007, when the agreement was executed between them. The suit was instituted on 01.06.2009. 4(i)(b) Respondent-defendant denied the entire case of the appellant-plaintiff. According to the plaintiff, the cause of action arose initially on 01.04.2003, when the shuttering plates were rented out to the defendant and thereafter on 12.11.2007, when the agreement was executed between them. The suit was instituted on 01.06.2009. 4(i)(b) Respondent-defendant denied the entire case of the appellant-plaintiff. According to the defendant, he had neither taken on rent any shuttering plate from the plaintiff on 01.04.2003 nor executed any agreement in favour of the plaintiff on 12.11.2007. The pleaded stand of the defendant was that it was the plaintiff, who had taken away 9 shuttering plates from him and this matter was reported by him at the Police Station. That he was pressurized by the plaintiff to withdraw the complaint and compelled to sign some papers. While appearing in the witness box, defendant did not make any mention of having lodged any complaint in writing at the police station about his having been forced to sign documents. His statement in the witness box was about making some oral complaint regarding plaintiff’s taking away his 9 shuttering plates. 4(i)(c) It is not the case of the defendant that he had lodged any complaint against the alleged action of the plaintiff in forcibly compelling him to sign some papers. The papers were allegedly got signed from him under compulsion in the year 2007, whereas the suit was instituted in the year 2009. While in the witness box, the defendant did not even state about lodging any complaint against plaintiff’s forcibly carrying 9 shuttering plates, though his pleaded stance was that he was pressurized by the plaintiff to withdraw the complaint. The conduct of the defendant is also to be considered. He denied executing the agreement dated 12.11.2017. However, during cross-examination, the defendant even denied his signatures on the power of attorney Ext.D-1. He denied his signatures on the written statement as well. 4(i)(d) The plaintiff has proved due execution of the agreement dated 12.11.2007. Apart from himself appearing in the witness box as PW-1, he also produced the scribe of the agreement- Desh Raj as PW-3. The scribe unequivocally deposed having scribed the agreement in question. He had also brought the register maintained by him and on that basis deposed that the agreement Ext.PW-2/B was entered in the register at Serial No.210. Apart from himself appearing in the witness box as PW-1, he also produced the scribe of the agreement- Desh Raj as PW-3. The scribe unequivocally deposed having scribed the agreement in question. He had also brought the register maintained by him and on that basis deposed that the agreement Ext.PW-2/B was entered in the register at Serial No.210. No suggestion was given to this witness on behalf of the defendant that the agreement was not signed by the defendant in his presence. 4(i)(e) Sh. Som Dut appeared as PW-2 in the capacity as witness to the agreement dated 12.11.2007; He stated that agreement executed on 12.11.2007 was scribed by Desh Raj; The scribe had read over the contents of the agreement to the parties; The parties were made to understand the terms and implications thereof; The parties signed over the same after admitting the contents of the agreement thereafter he and other witness Madan Mohan Marol also signed the same. This witness denied the suggestion given to him about agreement having not been prepared in his presence. Taking into consideration the pleadings and evidence on record, learned Trial Court justifiably held that execution of agreement dated 12.11.2007 Ext. PW-2/B was proved on record by the plaintiff in accordance with law and it was a valid agreement. 4(ii) Limitation (Substantial Question of Law) 4(ii)(a) It was established on record that the agreement dated 12.11.2007 (Ext. PW-2/B) related to and was in furtherance of the transaction that took place between the parties in the year 2003. The agreement (Ext. PW-2/B) specifically mentioned that the defendant had taken on rent 30 shuttering plates from the plaintiff in the year 2003. That he had returned 9 shuttering plates but had still to return 21 shuttering plates. In lieu of this, the parties had agreed upon certain terms and conditions about return of the shuttering plates and also about payment of the rent @ Rs.25,000/- in lumpsum and mode and modalities thereof. Observation of the learned First Appellate Court that the agreement dated 12.11.2007 was not relatable to the transaction that took place between the parties in the year 2003 is factually incorrect. Observation of the learned First Appellate Court that the agreement dated 12.11.2007 was not relatable to the transaction that took place between the parties in the year 2003 is factually incorrect. 4(ii)(b) It is further to be considered that though the original transaction took place on 01.04.2003 and the defendant did not comply with the terms and conditions of the arrangement agreed on 01.04.2003, however, he acknowledged his debt & liabilities thereunder and agreed to pay/discharge the same by executing agreement on 12.11.2007 Ext.PW2/B. In this context, Section 25 of the Indian Contract Act, 1872 would come into play, which along with illustration (e) read as under:- “25. Agreement without consideration, void, unless it is in writing and registered or is a promise to compensate for something done or is a promise to pay a debt barred by limitation law.—An agreement made without consideration is void, unless— (1) it is expressed in writing and registered under the law for the time being in force for the registration of [documents], and is made on account of natural love and affection between parties standing in a near relation to each other; or unless (2) it is a promise to compensate, wholly or in part, a person who has already voluntarily done something for the promisor, or something which the promisor was legally compellable to do; or unless; (3) it is a promise, made in writing and signed by the person to be charged therewith, or by his agent generally or specially authorized 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. In any of these cases, such an agreement is a contract. Explanation 1.—Nothing in this section shall affect the validity, as between the donor and donee, of any gift actually made. Explanation 2.—An agreement to which the consent of the promisor is freely given is not void merely because the consideration is inadequate; but the inadequacy of the consideration may be taken into account by the Court in determining the question whether the consent of the promisor was freely given. Illustrations (a) to (d)………… (e) A owes B Rs. 1,000, but the debt is barred by the Limitation Act. A signs a written promise to pay B Rs. 500 on account of the debt. Illustrations (a) to (d)………… (e) A owes B Rs. 1,000, but the debt is barred by the Limitation Act. A signs a written promise to pay B Rs. 500 on account of the debt. This is a contract.” As per Section 25(3),a promise made in writing and signed by the person to be charged with, to pay a time barred debt would be a valid and enforceable contract. The cause of action in case of execution of an agreement of a promise to pay a time barred debt would start from the date of the execution of such agreement. 4(ii)(c) Section 29(1) of the Limitation Act provides that “Nothing in this Act shall affect Section 25 of the Indian Contract Act, 1872”. 4(ii)(d) At this juncture, it would be appropriate to refer to (2022) 9 SCC 364 (Kotak Mahindra Bank Limited Vs. Kew Precision Parts Private Limited & Others.), wherein it was held that the promise and acknowledgment in writing, signed by a party or its agent authorised in that behalf, have the effect of creating a fresh start of limitation. The difference between acknowledgement of debt and a promise to pay time barred debt is that an acknowledgement under Section 18 of the Limitation Act has to be made within the period of limitation and need not be accompanied by any promise to pay. If an acknowledgment shows existence of jural relationship, it may extend limitation even though there may be a denial to pay, whereas Section 25(3) of the Contract Act is attracted, when there is an express promise to pay a debt that is time barred or any part thereof. Further the promise to pay can be inferred on scrutinizing the documents but the promise should be clear and unconditional. Relevant parts from the judgment reads as under:- “29. From the above, it is clear that any agreement to pay a time barred debt, would be enforceable in law, within three years from the due date of payment, in terms of such agreement. It appears that Section 25(3) of the Indian Contract Act was not brought to the notice of the NCLAT. The NCLAT also did not consider the aforesaid Section. 30. In this appeal, it is contended that the last offer of 20th December, 2018 was followed by an agreement. Whether there was such agreement or not would have to be considered by the Adjudicating Authority. The NCLAT also did not consider the aforesaid Section. 30. In this appeal, it is contended that the last offer of 20th December, 2018 was followed by an agreement. Whether there was such agreement or not would have to be considered by the Adjudicating Authority. To invoke Section 25(3), the following conditions must be satisfied:- 30.1 It must refer to a debt, which the creditor, but for the period of limitation, might have enforced; 30.2 There must be a distinct promise to pay such debt, fully or in part; 30.3 The promise must be in writing, and signed by the debtor or his duly appointed agent. 31. Under Section 25(3), a debtor can enter into an agreement in writing, to pay the whole or part of a debt, which the creditor might have enforced, but for the limitation of a suit in law. A written promise to pay the barred debt is a valid contract. Such a promise constitutes novation and can form the basis of a suit independent of the original debt, for it is well settled that the debt is not extinguished, the remedy gets barred by passage of time as held by this Court in Bombay Dyeing and Manufacturing Company Limited vs. State of Bombay. 32. Section 25(3) applies only where the debt is one which would be enforceable against the defendants, but for the law of limitation. Where a debt is not binding on the defendant for other reasons, and consequentially not enforceable against him, there is no question of applicability of Section 25(3). 33. There is a distinction between acknowledgment under Section 18 of the Limitation Act, 1963 and a promise within the meaning of Section 25 of the Contract Act. Both promise and acknowledgment in writing, signed by a party or its agent authorised in that behalf, have the effect of creating a fresh starting of limitation. The difference is that an acknowledgment under Section 18 of the Limitation Act has to be made within the AIR 1958 SC 328 period of limitation and need not be accompanied by any promise to pay. If an acknowledgment shows existence of jural relationship, it may extend limitation even though there may be a denial to pay. On the other hand, Section 25(3) is only attracted when there is an express promise to pay a debt that is time barred or any part thereof. If an acknowledgment shows existence of jural relationship, it may extend limitation even though there may be a denial to pay. On the other hand, Section 25(3) is only attracted when there is an express promise to pay a debt that is time barred or any part thereof. Promise to pay can be inferred on scrutinising the document. Only the promise should be clear and unconditional.” 4(ii)(e) Since the execution of agreement dated 12.11.2007 (Ex. PW-2/B) has been proved on record; Since under this agreement, the defendant had undertaken to pay the time barred debt as per the mode and modalities settled in the agreement, therefore, the suit filed by the plaintiff on 01.06.2009 for enforcing this agreement that was relatable to the first transaction between the parties that took place on 01.04.2003, has to be held within the limitation period-the suit having been filed within the period of two years from the date of execution of the agreement Ext.PW-2/B. The conclusion drawn by learned First Appellate Court about the suit being barred by limitation is based upon incorrect interpretation and application of law & facts. The substantial question of law is answered accordingly in favour of the appellant/plaintiff. 5. As cumulation of the above discussion, the present appeal succeeds and is allowed. The judgment and decree dated 15.10.2015 passed in Civil Appeal No.30/2015, by the learned First Appellate Court is set aside. Consequently, the judgment and decree dated 07.04.2015 passed in Civil Suit No.908/2013, by the learned Trial Court is affirmed and upheld. Pending miscellaneous application(s), if any, also stand disposed of.