1. ' Appellant aggrieved by the impugned order dated 30-10-2008, whereby granted conditional leave to defend, the appellant preferred this appeal.
2. ' Brief facts are that respondent filed a suit for recovery of Rs,21 Million under Order XXXVII, rules 1 and 2, C.P.C. On dishonour of Cheque bearing No,5749297 dated 4-12-2006. The respondent alleged in the memo. Of plaint that it is engaged in the business of Stock Brokerage and Equity Investment. In the first week of December, 2006, the appellant has opened an Account No,1577 with CDC Sub-Account No,7394 with the appellant for purchase of 1.5 Million shares of Messrs Calimate Telips Telecom Limited for total value of Rs,151.5 Million. As a part consideration of the above said amount, the appellant had issued a cross-cheque for a sum of Rs,21 Million in favour of the respondent. The cheque when deposited for credit in the account of the respondent, the same was bounced/dishonoured with the endorsement, not arranged for/Insufficient Funds.
3. ' After service of notice, as required under Order XXVII, Rules 1 and 2, C.P.C., the appellant filed application under Order XXXVII, rule 3, C.P.C. To grant unconditional leave to defend along with application under section 5 of Limitation Act to condone the delay in filing application.
4. ' After hearing the learned Advocates for the parties, learned Single Judge condoned the delay.
5. However, granted leave subject to furnishing surety in the sum of Rs,21 Million within four weeks' time.
6. ' We have heard Mr. Behzad Ahmed, learned Advocate for the appellant and Mr. Muhammad Anwar Tariq, learned Advocate for respondent.
7. ' Learned counsel for the appellant vehemently argued that respondent is stock broker and in the first week of December, 2006, he deposited a sum of Rs,72.8 Million with the respondent and instructed it to purchase 1,500,000 shares of Messrs Callmate Telips Telecom Limited at an average rate of Rs,100 per share in the open stock market. The respondent purchased the said shares and extended Badla finance/Continuous Funding System (CFS) of Rs,77.2 Million as whole for purchase of all 1,500,000 shares collectively and Rs,51.67 per share individually. The appellant alleged that he had paid Rs,72.8 Million to the respondent through various cheques and pay orders, details of which he has given in the application, filed for granting unconditional leave to defend. It was further alleged by the appellant that he had issued the cheque in question amounting to Rs,21 Million but that cheque due to some internal error of the Bank could not be cleared as on that date sufficient fund was available in the account of the appellant. The appellant was when informed by the respondent for the dishonour of the cheque. On the request of respondent, he immediately got pay order of the said amount prepared and handed over the same to the respondent on the same date i,e, 5-12-2006. The respondent assured the appellant that the dishonoured cheque will be handed over to the appellant,, but now the respondent malafidely using the same. The appellant, in this respect lodged a complaint against the respondent to Karachi Stock Exchange. It was further alleged by the appellant that respondent without any oral or written authority/approval/consent of the appellant sold the shares at a ludicrous price of Rs,15 per share. The learned Advocate for the appellant on this fact argued that the appellant was entitled for grant of unconditional leave to defend.
8. ' On the other hand, Mr. Muhammad Anwar Tariq, learned Advocate for the respondent argued that appellant has not denied that he had issued a cheque in the sum of Rs,21 Million and further that the same has been dishonoured. It was further argued that leave to defend application was hopelessly time-barred. The learned Single Judge exercised discretion, by granting conditional leave to defend the suit. Learned Advocate in support of his contentions relied upon the case of Fine Textile Mills Ltd v. Haji Umar PLD 1963 SC 163.
9. ' We have heard the respective arguments advanced by the learned Advocates for the parties and perused the record.
10. 'From the perusal of the record, it appears that the appellant has business relationship with the respondent who is a stock brokerage. The respondent maintained account of appellant to purchase the share under the instructions of the appellant. As per respondent's own showing, he purchased shares of total value of Rs,151.5 Million on behalf of appellant and as far as consideration of the said share the appellant issued a cheque in the sum of Rs,21 Million. The question, whether after dishonoured of the cheque dated 4-12-2006 the pay order of same amount was issued in respect of the amount pertaining to dishonoured cheque or it was under some other consideration.
11. This question can only be answered after recording the evidence.
12. ' In the case of Mian Rafique Saigol and another v. Bank of Credit and Commerce International (Overseas) Ltd. And another PLD 1996 SC 749, the Honourable Supreme Court, after taking into consideration various decisions, including principles laid down in the case of Fine Textile Mills Ltd. It was held that:- "Where the defence disclosed by the defendant in his affidavit filed in support of application for grant of leave to defend is found by the Court to be illusory, or lacking bona fides, or is intended to delay the proceedings or is based on allegation of vague and general nature relating to misrepresentation, fraud and coercion without any supporting material, leave may be granted on condition of either deposit of the amount claimed in the suit or on furnishing of security for the same or on such other terms and conditions which the Court may thing fit."
13. ' In the case of Pakistan Water and Power Development Authority (WAPDA) v. Messrs Sea Gold Traders and 2 others 2003 CLD 392, after taking into consideration Fine Textile Mills case reported in PLD 1969 SC 163 upon which Mr. Muhammad Anwar Tariq learned Advocate for the respondent relied, it was held that:- "Where there arose triable issues for adjudication leave normally is granted unconditionally and where defence is patently dishonest or unreasonable, when it could not reasonably expected to succeed, the leave can be granted conditionally. The issue for the grant or not to grant leave, and whether to grant or not to grant conditional leave can be summarized in the light of decisions of various Courts right from Fine Textile Mills case reported in PLD 1969 SC 163 as under:--
(i) Leave to defend in a suit instituted under Order XXXVII, Civil Procedure Code shall be granted by Court where the facts disclosed by the defendant on affidavit make out a case of shifting of onus on plaintiff.
(ii) Leave may also be granted on any ground or fact which the Court considers sufficient to support the application for grant of leave.
(iii) Refusal to grant leave is a rare phenomena confined to cases where no defence at all is disclosed by the defendant.
(iv) No hard and fast rule can be laid down for grant of conditional or unconditional leave.
(v) Where facts disclosed in the affidavit are such that it becomes necessary for the plaintiff to prove consideration of the instrument leave to defend may be granted unconditionally.
(vi) Leave can be granted unconditionally where execution of the negotiable instrument is denied and from material on record it is not possible for Court to record a positive finding at the stage of consideration of application.
(vii) Where claim in suit on its face appears to be prima facie time-barred, unconditional leave can be granted.
14. (viii)There can be other circumstances in which unconditional leave can be granted.
(ix) Where defence disclosed found by the Court illusory or lacking bona fides, Leave can be granted conditionally.
(x) Where defence in the application are vague or intended to delay the proceedings without supporting material about the allegation of fraud, coercion, leave can be granted conditionally.
(xi) What should be terms and conditions for the grant of leave is at the discretion of the Court to be exercised keeping in view facts and circumstances of each case."
15. ' After coming to the conclusion that appellant/defendant has plausible defence and is entitled to leave to defend the suit. The appellant becomes entitled for unconditional leave to defend in view of the principle laid down by the Honourable Supreme Court in the case of Mian Rafiq Saigol.
16. ' For the foregoing reasons, listed appeal is allowed and the impugned order is modified only to the extent that appellant is entitled for grant of unconditional leave to defend the suit.