Under Section 19, where payment on account of a debt or of interest on a legacy is made before the expiry of the prescribed period by the person liable or their agent, a fresh period of limitation is computed from the date of payment, provided an acknowledgement of the payment appears in the handwriting of, or in a writing signed by, the person making it. A bank transfer remark, a signed receipt counterfoil, or a covering letter usually satisfies the writing requirement.
How Section 19 works in India
The supplier must show two things: that the payment was made by the debtor towards this debt before limitation ran out, and that the debtor recorded it in writing. In modern trade the writing is often the NEFT or UPI narration ("part payment inv 123"), the debtor's email or WhatsApp confirming the transfer, or the debtor's own ledger extract. A cheque for part of the dues that is honoured is both a payment and a signed writing. Where a payment is made without specifying an invoice, the creditor may appropriate it under the Contract Act, but the Section 19 effect is clearest when the debtor's writing identifies the debt.
Why it matters for getting paid
Buyers who pay small "token" amounts to keep a supplier quiet are, without realising it, keeping the full debt enforceable. Suppliers should accept every part payment, ask the buyer to confirm it in writing, and record the invoices it is applied to. Together with Section 18 acknowledgements, this keeps the 3-year period running from the latest payment. A running account with regular payments rarely goes time-barred.
How FundRaksha uses it
FundRaksha's advocates map every receipt against the invoices to establish the live limitation date, and ask buyers to confirm part payments in writing during settlement talks, which preserves the client's position if the plan fails. The service begins with a free assessment; the fee is 30% of recovery only, and 700+ businesses have been paid this way.
Worked example (hypothetical)
A Rajkot casting unit is owed ₹8,00,000 due on 1 July 2023; limitation would expire 1 July 2026. On 20 May 2026 the buyer pays ₹1,00,000 by RTGS with the narration "against outstanding bills" and emails "₹1 lakh transferred today towards your pending bills, balance soon". The payment is before expiry and acknowledged in the buyer's writing, so a fresh three years run from 20 May 2026 to 20 May 2029 for the ₹7,00,000 balance. If the buyer had paid the ₹1,00,000 on 10 July 2026, after expiry, Section 19 would not have revived the barred debt.
Last reviewed: 2026-10-08. Information for Indian businesses; not legal advice.