Breach of contract (residuary):
how long do you have?
Last reviewed: 2026-08-19 · quoted from the India Code bare-Act PDF
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.
The Schedule row, as the Act prints it
Article 55Description: For compensation for the breach of any contract, express or implied not herein specially provided for.
Period: Three years.
Time from which period begins to run: 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.
Open the bare Act on India Code →
In plain English
The residuary contract article: any breach-of-contract damages claim not covered by a specific article gets three years from the breach. Successive breaches each carry their own clock, and a continuing breach keeps limitation open until it ceases (echoing s.22 of the Act).
Where this comes up
- Damages for defective goods or services under a supply contract
- Breach of a service agreement, distributorship or franchise
- Employer suing on a breached employment bond
What can reset or extend this period
General rules for entries in the Suits division. The full statutory quotes (ss.5, 12, 18-19, 6-8) are on the finder page.
No condonation — ever
Section 5 applies only to appeals and applications, never to suits. A time-barred suit must be dismissed under s.3 'although limitation has not been set up as a defence'. There is no discretionary mercy for suits.
Acknowledgment and part-payment reset the clock
A written acknowledgment of liability signed by the party (s.18), or a part-payment acknowledged in the payer's handwriting or signed writing (s.19), gives a fresh period — but only if made BEFORE the current period expires. An acknowledgment of an already-barred debt creates no fresh period under this Act.
Computation exclusions
s.12(1) excludes the first day; s.4 lets you file on the reopening day if the period expires while the court is closed; s.14 excludes time spent prosecuting in good faith in a court without jurisdiction; s.15 excludes stay/injunction periods and statutory-notice time; s.17 postpones the start until discovery in cases of fraud, concealment or mistake. But s.9: once time begins to run, no subsequent disability stops it.
Legal disability
If the person entitled to sue is a minor or of unsound mind when the period would start, ss.6-7 let them sue within the same period after the disability ceases — capped by s.8 at three years from cessation, and denied entirely to pre-emption suits (Article 97).
Frequently asked
When is a breach 'continuing'?
When the obligation is ongoing and the violation persists day by day (e.g. continuing failure to maintain), a fresh period runs at every moment the breach continues (s.22); a one-time failure to pay or deliver is not a continuing breach.
Does a legal notice extend limitation?
No. Sending a notice neither stops nor restarts time. Only a signed acknowledgment (s.18), an acknowledged part-payment (s.19), or statutory exclusions (ss.12-15) affect the computation.
This is a reference to the statutory text, not advice on a live matter. Limitation is brutally fact-sensitive — when the cause of action accrued, whether an acknowledgment or part-payment reset the clock, and which exclusions under ss.4-15 apply all turn on your specific facts. This page is a reference to the statutory text, not advice on a live matter, and it does not create an advocate-client relationship. A single day's error can be fatal to a claim: s.5 condonation never applies to suits, and several special-statute deadlines (Arbitration s.34(3), IBC s.61(2)) are hard ceilings no court can extend. Verify every period against the bare Act as currently amended and against current case law, and take advice on your own facts before acting. Provisions here were reviewed on 19 August 2026.