' ABDUL HAYEE KURESHI, J.-The present appeal under clause 10 of the Letters Patent has been filed by M/s. Atlas Travels Limited, a private limited Company, carrying on business at Karachi, to challenge the judgment of a learned Single Judge on the original side of this Court whereby Suit No, 74/1963, filed by the respondent, National Commercial Bank Limited, against the appellant as also against Abmed Sayeed Khan Niazi and Chaudhry Fazal Illahi, was decreed for a sum of Rs, 2,38,728.43 with costs and interest at 6% per annum. The suit against respondent Ahmed Sayeed Khan Niazi had abated by reason of his death and the legal representatives not having been impleaded. In the original Judgment dated 20th November, 1967, the suit against Choudhry Fazal Illahi was shown as dismissed but on an application under section 152, C. P. C. An order was passed by the learned Single Judge on 26th April, 1968, whereby the judgment and decree was ordered to be amended so that the suit was also decreed against this respondent. For the purpose of convenience the appellant M/s. Atlas Travels Limited is hereinafter referred to as the "principal debtor", respondent Choudhry Fazal Illahi is referred to as "debtor" and respondent National Commercial Bank Limited is referred to as "creditor".
2. The debtor Choudhry Fazal Illahi has put in no appearance before us at the time of hearing of the appeal. While, appellant/principal debtor was represented before us by Mr. Z. U. Ahmed, the respondent/creditor was represented before us by Mr. Fakhruddin.
3. The brief facts of the case are that a suit was filed on the original side of this Court under Order XXX VII of the Code of Civil Procedure for recovery of a sum of Rs, 2,38,728.43 with costs and interest.
The plaint referred to 3 separate promissory notes, 3 letters of continuity and 3 demand promissory note delivery letters. These documents were executed on behalf of the principal debtor as also by the Directors and employees of the principal debtor. The said documents left the space denoting the A date of execution as well as the amounts blank. The documents were collateral security for overdraft facilities to the principal debtor Company which had a current account with the creditor.
This account had been opened on 16th September, 1959 and the request for overdraft was made on 2nd March, 1961. As between 2nd December, 1961 and 28th March, 1963 the principal debtor obtained overdraft from the creditor Bank to the extent of the suit amount. A notice was given on behalf of the creditor Bank to the principal debtor demanding the amount due on 29th September, 1962 and a reply was made on 12th October, 1962 in which the Chairman of the principal debtor besides other contents of the said letter also stated as follows :- "This is a bona fide loan granted by the Bank and shall be paid and your clients are fully aware of the situation."
4. By an order of the learned Single Judge the principal debtor and Abmed Sayeed Khan Niazi (against whom the suit had abated) were granted leave to defend the suit on condition that they shall not dispose of certain properties in regard to which the creditor had made an application for attachment. Leave to defend was refused to respondent Fazal Illahi and he was debarred from contesting the suit. A written statement was filed by the principal debtor and the dead defendant. It was averred that the documents which form the basis of this suit did not bear the signature of the present office-bearers of principal debtor and such persons who had signed the documents were not authorised to create liabilities against the principal debtor. It was averred that the names of persons who were authorised to transact business with the creditor were communicated to the creditor. It was further averred that no notice as contemplated under the Nagotiable Instruments Act had been served on the principal debtor. In spite of leave having been sought and granted a plea was raised that the suit under Order XXXVII was not maintainable. Additionally, it was averred that promissory notes were without consideration, forged and fictitious. It was also averred that the suit was bad for non-joinder of the proper parties. Defendant Ahmed Sayeed had denied all liability.
5. On the averments of the parties the following 11 issues were framed by the learned Single Judge :- "(1) Whether the Promissory notes annexures A & D are executed by the Defendant No, l's officials ?
If not, what is its effect ?
(2) Whether defendant No, 2 has signed the promissory note annexure `G' ? If not what is its effect ?
(3) Are the Promissory notes A, D and G without consideration ? If so what is its effect ?
(4) Whether the signatories on annexures A & D were in service of Defendant No. 1 on 8th April 1964?
If not what is the effect ? (para 1 of the written statement).
(5) Whether the Defendant No. 1 bad authorised Defendant No, 3-to operate bill purchase account only ? If so is the defendant No. 1 liabie for the act of Defendant No, 3, done in excess of authority given by the Defendant No. 1.
(6) Is the Promissory note annexure 'G' forged ?
(7) Whether the suit as framed is maintainable ?
(8) Is the suit bad in law for non-joinder of proper parties ?
(9) Is the defendant No, 2 liable in his personal capacity ?
(10) What should be the decree if any ? (11) General."
6. In the judgment of the learned Single Judge issues Nos. 1, 2 and 6 were determined together and issues Nos. 4 and 5 also received the same treatment whereas the remaining issues were considered separately except to the extent that the same were overlapping. The finding was in favour of the respondent Bank.
7.. At the trial, the plaintiff/creditor examined Farooq Ahmed Khan who was at the relevant time an Accountant- of the creditor Bank, On behalf of the defendants the only witness was Mohammad Akram, the Managing Director of the principal debtor. Farooq Ahmed Khan, the witness for the creditor Bank disclosed all the circumstances relating to the transaction of business between the parties. He produced the account opening form, the Articles of Association of principal debtor, the instructions in regard to operation of the bank account and specimen signatures, the resolutions of the Board of Directors of the principal debtor concerning the operations of accounts, 3 promissory notes, letters of continuity and the demand notes delivery letters. This witness also produced the certified copies of the statement of accounts and the correspondence between the parties. This witness also produced a letter to show that on or about 7th December, 1962, a statement of account of the principal debtor with the creditor Bank had been sent to the principal debtor at their request. Mohammad Akram, the witness for the defendants had produced a letter written by the creditor Bank to the principal debtor on 6th July, 1962, showing that the creditor had noted that the dead defendant Ahmed Sayeed Khan had at one time been authorised to operate the bank accounts singly.
8. On behalf of the appellants the following contentions have been raised before us :-
(i) That the promissory notes had not been executed by the authorised agent of the principal debtor.
(ii) That the promissory notes and other documents had been rendered invalid because of unauthorised insertions.
(iii) That while the documents creating liability had been delivered on 2nd December, 1961 and the same having been filled up on 8th April, 1963 had become invalid.
(iv) That the suit under Order XXX VII of the Code of Civil Procedure was not maintainable against anyone else except the drawers of the documents of constituting the basis of the suit.
9. It would be profitable to examine the second and third contentions as enumerated in the foregoing paragraph in the first instance because these contentions touch the very question of validity of the promotes in the case. The learned Advocate for the appellant has contended before us that while the promotes had been delivered on '2nd December, 1961 the same having been filled up on 8th April, 1963 rendered the documents invalid. The evidence discloses that the appellant had made a request for grant of overdraft facilities on 2nd December, 1961. The statement of accounts. Certified copies whereof have been filed shows that as from 4th December, 1961 the appellant started drawing debits. The promotes no doubt were filled up on 8th April, 1963. The argument of the learned counsel completely overlooks the provisions of section 20 which reads as follows :- "2A. Where one person signs and delivers to another a paper stamped in accordance with the law relating to negotiable instruments then in force in British India, and either wholly blank or having written thereon an incomplete negotiable instrument, he thereby gives prima facie authority to the holder- thereof to make or complete, as the case may be, upon it a negotiable instrument, for any amount specified therein and not exceeding the amount covered by the stamp. The person so signing shall be liable upon such instrument, in the capacity in which he signed the same, to any holder in due course for such amount ; Provided that no person other than a holder in due course shall recover from the person delivering the instrument any thing in excess of the amount intended by him to be paid thereunder."
' The learned Advocate also relied on section 87 of the Negotiable Instrument Act for sustaining an argument that the instruments were materially altered so as to render the same void and discharge the indorser. The learned Advocate for the appellant has cited some case law before us , to maintain his argument.. The first case is Tribunal v. Sanu (1). The dictum in the case reads as follows :- ' Material alteration in an instrument, even with the consent of the parties, vacates the original instrument and makes it a new instrument liable to a fresh stamp duty unless the alteration was made before issue, or in order to correct a mistake, or to supply an omission; and in furtherance of the 'original intention o(, the parties."
' The next case cited by the learned Advocate is K. M. Basappa and another v. Patel Marvu (2). The principle stated in this case is that a party who has the custody of an instrument made for his benefit is bound to preserve it in its original state and any material alteration will vitiate the instrument. The facts in that case were that the debit of the pronote had been altered. Alteration in the debit of an instrument like a pronote would always be fatal if it touches the point of limitation.
The present case is completely distinguishable. What is more that authorisation to fill up promotes had also been separately given by three letters vide Exh. 7/15 to Exh. 7/17.
10. In the present case the facts are that blank promissory notes duly signed were delivered by the appellant to the respondent an section 20 of Negotiable Instruments Act would be fully attracted.
Moreover it is not the case of the respondent that any thing had bee inserted in the promotes which was unauthorised. The contentions are without substance and we reject the same.
11. The next contention of Mr. Z. U. Ahmed was that the promissory note had not been executed by the authorised agent of the appellants. The learned Advocate has not urged that point strenuously but we have examined the evidence on the point. Farooq Ahmed Khan, the Accountant of the respondent Bank was examined and he has stated as follows :- "Under Article 19 (2) to the Chairman can sign by himself alone all cheques and promotes and other documents. As soon as defendant No. 1 passed resolution authorising its officers to sign cheques and other documents their copies were sent to us. I produce Exh. 7/4/7, letter dated 8th July, 1961 Exh. 7/8 authorising Ch. Fazal Elabi, Director and/or Pir Hazrat Shah Accountant to .Sign bills and promotes. Thereafter these two persons operated the account of defendant No. 1 with us. I produce copy of letter dated {{FOOT NOTE}}
(1) AIR 1919 L B 45 (2) AIR 1951 Mys. 102 {{FOOT NOTE}} 4th July, 1962 along with copy of resolution dated 2nd July, 1962 Exh. 7/9 and 7/10. According to this letter and resolution A. H. Khan was appointed Chairman of defendant No. 1. He signed as A. Saeed, I produced letter dated 9th July, 1962 of defendant No. 1, along with specimen signature of A. H.
Khan Exh. 7/11.
' Request for overdraft facilities upto the extent of Rs, 3,00,000 was made by defendant No. 1 on 2nd December, 1961. Three blank promotes with date blank and amounts blank were signed by officers- of defendants No. 1 in my presence at the bank premises I produce the same Exhs. 7/12 to 7/14.
While Exh. 7/13 was signed by Ch. Fazal Elahi and Pir Hazrat Shah and Exh. 7/14 was signed by its Chairman A. Saeed (A. H. Khan). Rate of interest was 5% over bank rate with minimum of 9% per annum with monthly rest. We had obtained three letters along with these promotes authorising the bank to fill in the hlanks referred to above. I produce these three letters Exh. 7/15-17."
' It seems the appellant had often appointed different office-bearers for operating the bank account. Farooq Ahmed Khan was cross-examined on the point and he has clearly stated that the three promotes bore the signatures of such persons who had at the time of execution of promotes, authority to operate the bank account on the relevant date. Our attention has also been drawn to a letter (Exh. 7/8) of the appellant advising the respondent Bank that as per the resolution of the Board of Directors of the company on 8th July, 1961 that either Ch. Fazal Ellahi, a Director or Pir Hazrat Shah, the Accountant of the appellant company could execute promissory notes and create liability on behalf of the company. While considering this point some other documents also need to be mentioned. The appellant by a letter (Exh. 7/21) dated 7th December, 1962 requested the respondent bank to supply to them a copy of statement of accounts for the months of May and June, 1962. As on 30th June, 1962 the account of the appellant showed a debit balance of Rs, 2,23,228/99 such statement was sent by the respondent Bank to the appellants but there is nothing on the record to, show that the appellants objected to the debit balance being shown at that figure. Again in reply to a notice given by the respondent bank to the appellants the latter by a letter dated 12th October, 1962 (Exh. 7;27) clearly stated as follows :- "This is a bona fide loan granted by the Bank and shall be paid and your clients are fully aware of the sitnation. But if they prefer to indulge in litigation we have no powers to hold their hands. We are, however, prepared to discuss the matter in a business like manner and arrive at some equitable agreement."
12. The statement of accounts which have not been challenged before us coupled with the clear admission contained in the letter Exh. 7/27 can leave one in no doubt that the amount claimed in the suit represents the bona fide outstanding against the appellants.
' Needless to state that a presumption of genuineness attaches to the entries in the books of account maintained by a banker and the appellants have hot even attempted to displace such presumption.
13. The last contention of the Advocate for the appellant was that the suit under Order XXXVII of the Code of Civil Procedure was maintainable only against the drawer of the documents viz. The promotes. In the present case the drawer of the documents are office-bearers of the appellant Company who could create liabilities against the appellants. The argument in completely misconceived. It was also faintly, argued by the learned Advocate that the suit was in the nature of suit for accounts rather than one under Order XXXVII of the Code of Civil Procedure. It is common knowledge that the debts of an account holder banks are never static for the reason of interest being added to the same. A mere C addition of interest will not convert a suit based on a Negotiable Instrument into a suit for accounts if the instrument itself contains a provision for payment of interest. Moreover the appellants had taken part in the proceedings by obtaining leave to defend the suit. In the present case also the appellants were bound to pay interest and therefore the increase in the oustandings would be a matter of course.
14. For all the above reasons we see no substance in this appeal which is dismissed with costs.