P L D 1961 (W (PLP)

7. There are two questions before its. The first question is which of the two Articles namely 56 and 115 of the Limitation Act applies to the facts of the present case. It would be useful to reproduce Articles 56 and 115 of the Limitation Act. They run as under: 56: For the price or 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. 115: For compensation for the breach of any contract, express or implied, not in writing registered and not herein specially provided for. Three years. When the contract is broken, or (where there are successive breaches) when the breach in respect of which the suit is instituted occurs, or (where the breach is continuing) when it ceases. In order to apply Article 115 of the Limitation Act, what is essential is that the "suit should be for compensation for the breach of any contract". This is, on the face of it, not a suit for compensation. This is a suit for the price of the huts con structed. In this connection para. 4 of the plaint may be referred to. It runs as under: "That the defendant paid by way of part payment on account of the 427 Jhoopries the construction whereof the plaintiff completed as agreed, the defendant made the payment of Rs. 13000 (Thirteen thousand only) to the plaintiff and there still remained the balance of Rs. 8,350 (Eight thousand three hundred and fifty) due from the defendant to the plaintiff The plaintiff claimed the sum of Rs. 8,350 not as compen sation but as costs of construction payable to him. The contract, whatever it was, has been completed, and the plaintiff claimed only the cost of the construction. Article 115 of the Limitation Act clearly does not apply to the circumstances of the present case. At any rate one fails to see how the breach of the contract took place in July 1950. The huts were constructed in September 1948. The bill was submitted in December 1948 and payment at the rate of Rs. 50 per but was refused in December 1948. The mere fact that the plaintiff approached different authorities for payment ii the rate he wanted will not extend time or the refusal of the authorities mean successive breach of the contract. The Article applicable is Article 56 of the Limitation Act. The period of three years will start running when the work is done. In this case admittedly the work was completed sometime in September 1948. Even if it be taken that the work was completed in December 1948 when the plaintiff submitted his bill for the payment of the cost of construction of 427 huts at the rate of Rs. 50 the suit having been filed in April 1952 would be beyond three years unless the limitation is saved by an acknowledgement of the defendant under section 19 of the Limitation Act. Mr. Zafar Hussain, the learned Advocate for the plaintiff‑respondent strenuously contended that the limitation was saved by the acknowledgment of the defendant in July 1950: For the con sideration of the contention of the learned Advocate for the respondent it is necessary to reproduce sub‑clause (1) of section 19 and Explanation I to the same section. "19. (1) Where, before the expiration of the period prescri bed for a suit or application in respect of any property or right, an acknowledgement 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, or by some person through whom he derives title or liability, a fresh period of limitation shall be computed from the time when the acknow ledgment was so signed. Explanation 1:‑ For the purposes of this section an acknow ledgment may be sufficient though it omits to specify the exact nature of the property or right, or avers that the time for payment, delivery, performance or enjoyment has not yet come, or is accompanied by a refusal to pay, deliver, perform or permit to enjoy, or is coupled with a claim to a set‑off, or is addressed to a person other than, the person entitled to the property or right." In this connection it is also necessary to reproduce the letter which is said to be an acknowledgment of the liability. This letter is Exhibit 78 at page 35 of the paper‑book. The relevant portion of this letter runs as under: "With reference to your petition, dated the 26th January 1950, addressed to the Honourable Minister, Refugee and Rehabilitation Department, Sind, on the subject noted above. I am directed to inform you that Government have carefully considered your case, but regret that they cannot allow you any higher rate than Rs. 20 per landhi sanctioned by the Col lector. Your petition has accordingly been rejected." The construction of documents alleged to contain acknow ledgments of liability is governed by the same principles as those that apply to the construction of other documents. Reading the above letter it is difficult to construe however liberal interpretation may be put to the contents of the letter that the Government acknowledged its liability to pay at the rate of Rs. 50 per Landhi. The section requires a definite acknowledgment of liability. The acknowledgment should be in respect of the right to claim at the rate of Rs. 50 per hut.

8. Mr. Zifar Hussain relying on Explanation 1 to section 19 contended that the letter of July 1950 was a sufficient acknowledgment as the Government thereby only refused to make payment at the rate of Rs, 50. ' Explanation I to section 19 requires that if acknowledgment is accompanied by refusal to pay it would be sufficient for the purposes of section 19 of the Limitation Act. In other words, there must be in the first place, an acknowledgment of the liability and then refusal to pay.

9. Mr. Lakhani the learned Advocate for the appellant relied on the case of Bindeshwari Prasad v. Board of Saran through Special Officer (A I R 1961 Pat. 134) In that case the plaintiff submitted his bill for a certain amount of money for work done to the defendant. The defendant passed the bill for a lesser amount and disallowed the plaintiff's claim for the rest and expressly denied and repudiated its liability in respect of the remaining amount of the bill. It was held that the mere fact that the defendant passed the bill for a lesser amount and thereby admitted its liability to pay the sum allowed would not amount to an acknowledgment of its liability to the plaintiff to pay also the balance amount of the bill which was expressly disallowed. The circumstances of this case are similar to the facts of the present case. We would hold that the defendant‑appellant did not admit its liability to pay at the rate of Rs. 50 per hut. The suit therefore is beyond time. The limitation will run from the date the work was done. The work may by taken to have done either in September 1948 or in December 1948 when the plaintiff submitted his bill for the cost of the construc tion at the rate of Rs. 50 per hut. In either case under Article 56 of the Limitation Act, the suit having been filed in April 1952, would be beyond three years. We would hold that the suit was time barred, and would allow the appeal and dismiss the plain tiff's suit.

10. After we had reserved the judgment‑the learned Advocate for the respondent sent us a note relying on certain authorities in support of his contention that Article 115 of the Limitation Act applied. He relied on the case of Govind Narayam Kakade v. Rangnath Gopal Bajopadhye (A I R 1930 Bom. 572), This case has absolutely no application. This case decided points relating to Companies Act, 1913 and Article 120 of the Limitation Act. The next case he relied upon is Bharat' National Bank Ltd v. Bishan Lal and another (A I R 1932 Lah. 212). The observations in that case in fact would support the contention of the appellant that Article 115 of the Limitation Act applies to a suit for compensation. It was held in that case that in the event of a breach of contract embodying promise to pay a time‑barred debt due on accounts, a suit for compensation is the only remedy since the plaintiff cannot fall back on the original account. The third case that the learned Advocate relied upon is Sreenath Roy and others v. Peary Mohan Mookerjee (A I R 1917 Cal. 154). It was held in that case that a suit by a creditor against a surety upon a letter of guarantee payable on demand on a promissory note is governed by Article 115 and not by Article

56. A perusal of that case would show Chat no ground has been given as to how Article 115 is applicable to a case of liability under a simple debt unless it be on the ground of damages as compen sation. The last case relied upon is Sita Ram v. Mst. Mahmoodi Begum and another (A I R 1934 Lah. 475). This case in fact supports the case of the appellant. It was held in that case where a contract was given for construction of a building but later on before the completion of the contract it was given to another the original person could sue for the breach of the contract and the Article applicable would be Article 115 of the Limitation Act. For the reasons given above we allow the appeal but would make no order as to costs. K. M. A. Appeal accepted.