Question

Where, before the expiration of the prescribed period 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 any person through whom he derives his title or liability,

• A. a fresh period of limitation shall be computed from the time when the acknowledgement was so signed.
• B. limitation shall be computed from the time when originally the signature has been given
• C. a fresh period of limitation shall not be computed from the time when the acknowledgement was so signed.
• D. None of the above

Hint:

Remember the key difference: \textbf{Acknowledgment (Sec 18)} must be made \textit{before} the limitation period expires and it gives a fresh period of limitation. A \textbf{promise to pay a time-barred debt (Sec 25, Contract Act)} is made \textit{after} the limitation has expired and it creates a new, valid contract.

Answer 1

The Correct Option is A

Step 1: Understanding the Concept:
The question describes the legal effect of an 'acknowledgement of liability' on the period of limitation. This is a crucial concept governed by the Limitation Act, 1963, which can extend the time available to a creditor or claimant to file a suit.
Step 2: Detailed Explanation:
The scenario described in the question is directly addressed by Section 18 of the Limitation Act, 1963, titled "Effect of acknowledgment in writing".
Section 18(1) states that if, before the expiration of the prescribed period of limitation for a suit or application, an acknowledgment of liability is made in writing and signed by the party against whom the right is claimed, then a fresh period of limitation shall be computed from the time when the acknowledgment was so signed.
This means that the 'limitation clock' is reset. A new period of limitation (of the same duration as the original one) starts running from the date of the valid acknowledgment.
The essential conditions for a valid acknowledgment under Section 18 are:
1. It must be made before the original limitation period expires.
2. It must be in writing.
3. It must be signed by the person liable (or their agent).
4. It must acknowledge the liability in respect of the property or right.
The question fulfills these conditions, and option (A) correctly states the legal consequence.
Step 3: Final Answer:
As per Section 18 of the Limitation Act, a valid acknowledgment of liability starts a fresh period of limitation from the date it was signed. Therefore, option (A) is the correct answer.