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    Question

    Under Section 19 of the Limitation Act, 1963, what

    happens when a debtor makes a part payment of a principal debt before the expiration of the limitation period? 
    A The entire debt is extinguished and no further claim can be made Correct Answer Incorrect Answer
    B A fresh limitation period begins to run from the date of payment, provided the payment is acknowledged in writing signed by the debtor Correct Answer Incorrect Answer
    C Only the portion of debt paid becomes time-barred; the remaining portion continues with original limitation Correct Answer Incorrect Answer
    D The part payment has no effect on the limitation period Correct Answer Incorrect Answer
    E The creditor loses all rights to recover the remaining debt Correct Answer Incorrect Answer

    Solution

    Section 19(1) provides: "Where a person liable to pay a debt or legacy acknowledges it in writing on account of the debt or of interest on the legacy, before the expiry of the prescribed period, a fresh period of limitation shall be computed from the date of such acknowledgment." This provision encourages debtors to make part payments or acknowledge debts, knowing it creates a fresh limitation period benefiting creditors. The payment must be acknowledged in writing and signed by the debtor or authorized agent. This resets the clock, giving creditors additional time. Under Section 19(2), the proviso requires that (except for interest payments before 1 January 1928) the acknowledgment of payment must appear in the debtor's handwriting or be signed by them.

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