Acknowledgement of debt and securities is not an agreement. The executants merely confirm the dues as on a particular day and confirm the securities which are charged to the bank by way of security for the advance. Under these circumstances, acknowledgement of debt and securities is generally obtained by getting the signature of borrower/s and guarantor/s across a revenue stamp. However, the bank you have referred to may be obtaining it on a stamp paper of Rs 100 by way of abundant precaution.
In computing the limitation for any suit, the date from which such period is to be reckoned shall be excluded. The suit can be filed on the anniversary day. The limitation in respect of various documents/ transactions is available as under:
Bills of exchange or promissory note payable at sight
3 years from date of presentation.
Payable at a fixed time after date
3 years from due date of bill/note.
Loan payable in instalments
3 years from date on which the relative instalment falls due.
Money repayable by the mortgagor
on demand and on instalment repayments are agreed to - 12 years from date of mortgage deed.
In case of default of an instalment or principal or interest
The whole of mortgage amount becoming due - 12 years from date of default.
Personal liability of the borrower
3 years from date of acknowledgement of debt/demand promissory note.
Others including where the lender has given a cheque
3 years from the time, the cheque is paid.
Acknowledgement of debt
impliedly includes the acknowledgement of security for the debt. An acknowledgement signed by one of the joint borrowers or partners does not bind the others unless it can be established by evidence that the person signing was authorised expressly or impliedly to sign.
a: If the debtor makes a part payment before the expiry of the limitation period, either by himself or by his agent duly authorised on his behalf or in the handwriting of himself or such agent, fresh period of limitation starts from date of such part payment.
: A credit entry by itself does not save limitation. Pay in slip signed by the borrower or his duly authorised agent amounts to part-payment. A pay in slip signed by an employee of a partnership firm or a company does not save limitation.
: It needs to be noted that acknowledgement of debt and part payment should be obtained before the expiry of limitation period as they cannot revive the limitation if already expired.
Fresh promise to pay
Even after the expiry of limitation, the liability can be enforced if there is a fresh promise to pay the outstanding debt already barred by limitation, because u/s 25(3) of the Contract Act, a time barred debt is a valid consideration for a fresh promise to pay.
Even if you take an undated signed cheque the same shall be in the form of security. One can always have one if the same is towards hand loan or money transaction.