This is a suit for the recovery of Rs. 1,38,282.01. The facts leading to the filing of the suit are that at the oral request of defendant No. 1 they were granted bill purchase facility to the extent of Rs.
1,50,000 by the plaintiffs New Challi Branch, Karachi, on usual terms and conditions, and that defendant No. I in view of the above facility submitted four bills amounting in all to Rs. 1,66,498.01 in February, 1971 as per details given in the memo. Marked `A' attached with the plaint, against which the plaintiffs advanced a sum of Rs. 1,24,863.01 to defendant No. 1. The above amount was advanced against four bills in respect of the four consignments shipped by defendant No. I, to then East Pakistan in their own favour, but endorsed in favour of the plaintiffs. It has been averred that the delivery of the goods covered by the three bills mentioned in paragraph 3 of, the plaint were taken without the retirement of the documents by the defendant No.1's sister concern and whereas the fourth consignment could not land Chittagong and was sent back to Karachi and that the plaintiffs approached defendant No. 1 several tunes requesting them to reimburse to the plaintiffs to the tune of Rs. 1,24,863'01, which amount they had paid against the said four bills. It has been further averred that in response to the above demand, defendant No. 1 executed promissory note dated 10-7-1971. The plaintiff's. Chittagong branch filed a suit in respect of the three consignments in Chittagong District without prejudice to the plaintiffs' rights against the consignees and all other parties concerned and that in order to prove their bona fide, defendant No. 1 executed an agreement for hypothecation dated 27-11-1971. It has also been averred that after the filing of the said suit in November, 1971 East Pakistan, became victim of the Indian aggression and that the plaintiffs neither got the possession of the said goods nor the proceeds thereof and that the fourth consignment in respect of 287 bags of rapeseed dated 6-2-1971 valuing, Rs. 34,125'15 (which was returned to Karachi) was not traceable at Karachi except 6 bags. It has further been averred that defendant No. 2 have denied their liability to pay any damages in respect thereof. The plaintiffs, therefore, filed the present suit on the basis of the above averments and have relied upon the promissory note and hypothecation agreement.
2. Defendant No. 1 in their written statement have averred that under the terms of the bill purchase facility, the plaintiffs agreed to advance against the shipping documents of the consignment 75 % of the amount of their respective bills by crediting the same in the answering defendant's current account No. 25 and to credit the remaining balance 25 % on the shipping documents being retired by the final endorsees ' after deducting their charges and interest at the rate of 9 % per annum. It has further been averred that the answering defendant shipped four consignments of rapeseed under the four bills of lading for delivery at Chittagong to their endorsees and handed over to the plaintiffs shipping documents relating to these consignments duly endorsed in favour of the plaintiffs alongwith the connected bills and hundis in all amounting to Rs. 1,66,498'01 drawn on Messrs Sri Gobinda Oil Mills, Chittagong, and that against the above amount received a sum of Rs.
1,24,863'01. It has been admitted that the value of the three consignments which were discharged at Chittagong port was Rs. 1,32,372'46. However, it has been aveired that the plaintiffs have themselves got these three consignments cleared at Chittagong under sortie arrangement, which they had made with Messrs Australasia Bank Ltd. And Messrs Sid Gobinda Oil Mills Ltd. And that against the value of Rs. 1,32,372'46 the plaintiffs had credited Rs. 99,276'86 being 75 % of the value and that the fourth consignment, valuing Rs. 34,125'15 returned to Karachi on or about 21-7-1971 without discharging the consignment are Chittagong but discharged only 6 bags at Karachi while the rest of the consignment consisting of 281 bags of rapeseed was not traceable. It has been further averred that the answering defendant were in fact entitled to recover a sum of Rs. 34,125.15 from the plaintiffs. On the basis of the above averments defendant No. I have denied their liability to pay any amount.
3. Defendant No. 2 have also filed their written statement; wherein, preliminary objections about the misjoinder of causes of action, about the plaintiffs' locus standi to file the suit and about the maintainability of the suit in general have been raised. However, it has been admitted that 287 bags containing rapeseeds were accepted from defendant No. 1 and/or from the forwarding agent for shipment per s. s. Surma for carriage from the port of Karachi to the port of Chittagong with bill of lading dated 16-2-1971. It has been averred that the particulars in the bill of lading were inserted by defendant No. 1 and/or their forwarding agent and that the answering defendant were not aware of condition, weight quality and value and that the above rapeseed was shipped in wet condition and were not in a fit condition to withstand the sea voyage and that if defendant No. I or their forwarding agent would have disclosed the condition, the answering defendant would not have accepted the consignment. It has also been averred that m. v. Surma sailed from Karachi Port on 16-2-1971 and arrived at the Chittagong Outer Anchorage on 8-3-1971 for the discharge of her cargo including the consignment in suit but there were riots and rebellion and that in spite of the efforts the goods could not be landed. It has further averred that the above consignment was brought back to Karachi and that Messrs Seawards, surveyors carried out the survey of the bags in question in the K. P. T. Area and opined that the alleged damage to the rapeseed in question was due to inherent defect or vice and that the answering defendant are neither liable for the alleged damage and/or for the alleged short landing.
4. On the basis of the above pleadings the following consent issues were adopted "(1) What were the terms of the bill-purchase facility granted by the plaintiffs to defendant No. 1?
(2) Did defendant No. 1 hand over the shipping documents of the four consignments in suit to the plaintiffs alongwith the relative bills? If yes did consignees of the said goods in East Pakistan fail to honour the said bills and the said fact was communicated to defendant No. 1 ?
(3) How were the three consignments which were landed at Chittagong. Cleared and' by whom?
And are the plaintiffs liable to the defendants for the value thereof, if so, in what amount?
(4) Did the plaintiffs file Suit No. 237 (A) 1967 in the Court of Subordinate Judge, Chittagong for recovery of value of three consignments landed there at the instance of defendant No. 1 as alleged in para. 7 of the plaint? If so, what it is effect?
(5) Was the loss and/or damage to the fourth consignment due to inherent vice and/or spontaneous combustion as alleged ? If so, what is its effect?
(6) Was the fourth consignment landed at Karachi in full ? If not, what part of it was short landed and did plaintiff in accordance with the directions of the defendant No. 1 lodge claim for said goods with defendant No. 2. If yes what is the effect.
(7) What amount of loss has accrued to the plaintiff and/or defen--dant No. I on account of the short landing and/or damage to the fourth consignment? And is defendant No. 2 liable for the same?
(8) What part of the fourth consignment remained undelivered to the plaintiffs and is defendant No. 2 liable for non-delivery?
(9) Are the plaintiffs entitled to recover the amount in suit from defendant No. 1 without returning the shipping documents to him?
(10) Whether the plaintiffs have a right to sue defendant No. 2 in respect of the fourth consignment?
(11) Was any misrepresentation committed by plaintiffs in relating to the Pronote, Delivery letter and Hypothecation deed as alleged by defendant No. 1 in paras. 5 and 7 of his written statement ?
(12) To what amount, if any are the plaintiffs entitled and from which of the defendants?
It may be observed that defendant No. 1 have not led any evidence whereas defendant No. 2 have also not produced any oral evidence but have only produced a survey report which was taken on the record by consent of the learned counsel for the plaintiffs as Exh. 6/14.
My finding on the above issues are as follows :-
5. Issue No. S.-It may be observed that the four bills in question were purchased in February 1971 There is no document of February, 1971 containing the terms and conditions of the bills purchase facility extended by the plaintiff-Bank to defendant No. 1. However, Mr. Z. C. Valliani, learned counsel for the plaintiff has relied upon Exh. 6/6 dated 27-11-1971 for the purpose of proving the terms and conditions upon which the above facility was granted by the plaintiffs to defendant No. 1. On the other hand, it was urged by Mr. A. I. Lari, learned counsel for defendant No. 1 that Exh.6/5 cannot be relied upon as it was not executed at the time of extending the above facility. His further submission was that the above facility .Was granted on the usual terms and conditions, namely, that the plaintiffs had advanced 75 % of the invoice value of the four consignments and that the bill of lading and other documents were endorsed in favour of the plaintiffs. It is true that Exh. 6/6 was not executed at the time of advancing of the above facility, but above document/indicates that the above facility was granted to defendant No. 1 on the standard terms and conditions of the plaintiff-Bank which are reflected in it, My finding accordingly on this issue is that the bill purchase facility was granted on the standard terms and conditions of the plaintiff-Bank, which are reflected in Exh. 6/6.
6. Issue No. 2.-There is no controversy on the question that in fact defendant No. 1 handed over the shipping documents of the four consign--ments to the plaintiffs at the time of availing the aforesaid facility, but the plaintiffs and defendant No. 1 are at issue on the question as to whether the drawee of the said bills in East Pakistan did not honour the aforesaid four bills, which were purchased. It is an admitted position that out of the above four consignments one consignment was returned to Karachi and it was not landed at Chittagong Port. As regards the remaining three consignments, it has been urged by Mr. Z. C. Valliani that defendant No. 1's sister concern had managed to obtain the delivery without retiring the documents from the plaintiff-Bank branch concerned, at Chittagong. On the other band, it has been urged by Mr. Lari that in fact the plaintiff- Bank took the delivery of the goods by entering into some arrangement with Messrs Australasia Bank Ltd. It has also been urged by Mr. Lari that admittedly the plaintiffs have not returned the shipping documents to defendant No. 1 in respect of the above consignment and, therefore, it should be presumed that the above three consignments were delivered against the documents.
From the evidence on record, it is evident that the plaintiffs did not receive the sale proceeds of the three bills against which they had advanced 75 % of the invoice value of the goods. In this regard reference may be made to Exhs. 6/4 to 8 and 6/10. Exh. 6/4 is a promissory note dated 10-7-71 executed by defendant No. 1 for the total amount received by them against the aforesaid four consignment, namely, Rs. 1,24,863.15. Exh. 6/5 is a D..P. Note delivery letter dated 10-7-71 forwarding the promissory note Exh. 6/4. Whereas Exh. 6/6 is the agreement of hypothecation, dated 27-11-71.
Exhs. 6/7 and 8 are the copies of two legal notices served by the plaintiffs on defendant No. 1 dated 8-4-72 and dated 13-4-72 containing the averment to the effect that the aforesaid three bills were not honoured. In my view if in fact the plaintiffs would have realised the sale price from the consignees, defendant No. 1 would not have executed the promissory note dated 10-7-71 or the letter of hypothe--cation. Furthermore, there was no reply sent by defendant No. 1 to the plaintiffs' aforesaid notice Exh. 6/7. However, defendant No. 1 sent a reply to the plaintiffs' second notice (Exh.
6/8) through their letter dated 18-4-72 Exh. 6/9. In para. 2 at page 1 of their aforesaid reply Exh. 6/9, defendant No. 1 bad averred that in fact plaintiffs had taken delivery of the goods against the relevant bills of lading and that the plaintiffs had the goods with them in their custody and control and/or had realised the sale proceeds thereof, or that they had ample security in respect thereof.
No clear cut stand was taken to the effect that in fact bill of exchange were honoured by the drawees or that the plaintiffs had realised the amount. If the above documents are to be read with Exh. 6/ 10, which is a certified copy of the plaint of the suit filed by the plaintiffs' in the Court of subordinate Judge, Chittagong, it becomes clear that the plaintiffs did not receive any amount against the aforesaid three bills. Accordingly, my finding on this issue is in the affirmative.
7. Issue No. 3.-I have already discussed hereinabove under Issue No. 2 that the goods covered under three consignments were not delivered to the plaintiffs. According to Mr. Villiani. Exb. 6/10 certified copy of the plaint of the aforesaid suit filed by the plaintiffs in the Subordinate Court, Chittagong indicates that the delivery of the goods was taken by Messrs Jupiter Trading Corporation and that the same were found in the godown of defendant No. 1's sister concern, namely Messrs Siri Gobinda Oil Mills Ltd. It has .Been further urged by him that defendant No. 1 have produced the above certified copy, therefore, the plaintiffs are entitled to rely upon the same.
Whereas it has been urged by Mr. Lari that there is no evidence to prove that Messrs Siri Gobinda Oil Mills was the sister concern of defendant No. 1 or that the goods were stored in godown of the said firm. If will suffice to observe that the above certified copy of the plaint has been produced by defendant No. 1 as a piece of evidence and nothing contrary to what has been averred in the plaint was suggested to P. W.
1. On the other hand, cross-examination by the learned counsel for defendant No. I was directed on the line of the contents of the above plaint, which indicate that in fact the delivery of the goods was taken by Messrs Jupiter Trading Corporation, but there is nothing on the record to prove or to indicate that there was any link between defendant No. 1 and the said firm. In the title of the plaint of the aforesaid suit one Narain Chandra Bubia has been shown as the proprietor of the above firm. My finding accordingly on the above issue is that the delivery of the three consignments was taken by Messrs Jupiter Trading Corporation and not by the plaintiffs. As regards the second part of this issue, it may be observed that defendant No. 1 have not been able to prove that the plaintiffs are liable to pay any amount/damage to them. Furthermore, defendant No. 1 has not made any counterclaim against the plaintiffs and, therefore, my finding on this portion of the issue is that the plaintiffs are not liable to defendant No. 1 for the value of the above consignments.
6. Issue No. 4.-Exh. 6/10 indicates that a suit was filed, but there is no evidence to prove that the above suit was filed at the instance of defendant No. 1. Learned counsel for defendant No. 1 has cross-examined P. W. 1 on the above question. P. W. 1 was unable to state as to whether the plaintiff -Bank had debited any amount towards the purchase of the court-fee stamps or for any other expenses, nor any account has been produced to indicate that any debit entry was made in the account of defendant No. 1 towards the expenses of the aforesaid suit. My finding on this issue is that the suit was filed, but there is no evidence on the record to conclude that it was filed at the instance of defendant No. 1.
9. Issue No. S.-In support of the above issue Mt. Tejani learned counsel for defendant No. 2 has relied upon Exhs. 6/12 and 14. Exh. 6/12 has been proved through the cross-examination of P. W. 1, whereas Exh. 6/14 which is also a survey report, prepared by Messrs Seaward Surveyors, was brought on the record with the consent of the learned counsel for the plaintiffs, para. 8 of Exh. 6/12 states that 6 bags presented for the survey were damaged on account of self-heating, whereas Exh. 6/14 shows damage of the aforesaid 6 bags on account of spontaneous heating. It has been urged by Mr. Tejani that self-heating falls within the term of inherent defect and, therefore, defendant No. 2 are not liable to pay any damage on account of the inherent defect in the subject of the consignment in question. It may be noticed that the aforesaid two survey reports relate to 6 bags only. However, it has been urged by Mr. Tejani that this Court should presume that the balance of 281 bags had also the same inherent defect. In my view the above two survey reports would not prove that the entire consignment of 287 bags had the aforesaid inherent defect.
Accordingly, my finding on issue No. 5 is that 6 bags which were surveyed, had inherent defect and that the effect of which is that the plaintiffs shall not be entitled to recover any amount in respect of the above 6 bags from defendant No. 2.,
10. Issue No. 6.-There is no controversy on the question that the fourth consignment was not discharged at the Chittagong Port, but was brought back to Karachi. It is also an admitted position that only 6 bags containing the distinctive marks could be traced out from the K. P. T. Area, which were the subject-matter of the survey, but no other bags were traceable with the distinctive numbers. There is also no dispute on the question that in fact the plaintiffs had lodged a claim with defendant No. 2 in respect thereof through Exh. 6/11, which was refuted by defendant No. 2 through Exh. 6/13. The burden of proof to account for the balance quantity was on defendant No. 2, after having issued a bill of lading Exh. 6/1 for 287 bags of rapeseed. It is true that in the survey report Exh.
6/12, it has been mentioned that there were certain bags of rapeseeds lying in the K. P. T. Area, which could not be identified, but there is no indication how many such bags were lying in the K. P.
T. Area, which could not be identified. In any case there is no evidence on the record to conclude that those bags were part of the consignment in question. My finding on this issue is accordingly that only 6 bags were landed at Karachi Port, which were the subject-matter of the two surety reports and there is no other evidence on the record to conclude that the balance quantity also landed at Karachi, My further finding is that the plaintiff in fact had lodged claim with defendant No. 2, in respect of the above consignment.
11. (a) Issues Nos. 7, 8 and 10.-I have already held while discussing hereinabove under Issue No. 6 that defendant No. 2 could account for 6 bags against 287 bags, of which they had issued bill of lading Exh. 6/ 1, and, therefore, it is evident that the plaintiffs and defendant No. 1 have suffered damage on account of the loss of 281 bags.
It has been urged by Mr. Tejani that the plaintiffs have no locus standi to sue defendant No. 2 as the survey report Exh. 6/12 indicates that the consignee of the consignment in question was defendant No. 1 and that the aforesaid survey was carried out at the request of Messrs Ahmad Ibrahim Agency Ltd. According to him either defendant No. 1 or. Messrs Ahmed Ibrahim Agency Ltd. Could have maintained a suit against defendant No. 2 if there was any alleged cause of action against the said defendant. In support of his above contention Mr. Tejani has referred to the case of Pakistan Interational Airlines Corporation v. Shaikh Muhammad Younus (PLD 1976 Kar. 184), para. 15 at page 194, wherein it was held that the consignee or the endorsee is entitled to maintain an action.
Whereas it has been pointed out by Messrs Valiani and Lari that the bill of lading Exh. 6/1 was endorsed in favour of the plaintiffs, which is clear from page 2 of the bill of lading in question Exh.
611. It was never the case of defendant No. 2 either in the written statement or in the cross- examination of P. W. 1, that the plaintiffs were not the endorsee of the bill of lading. In view of the endorsement in the bill of lading in favour of the plaintiffs, they are competent to maintain the above suit against defendant No. 2.
(b) Mr. Tejani has also vehemently urged that even if it is to be held that the plaintiffs are entitled to maintain action, but no decree can be passed against defendant No. 2 as the plaintiffs have failed to prove the quantum of damages. In support of his above contention Mr. Tejani has referred to the case of Deutsche Dampschiffaharts Gesellschaft v. Central Insurance Co. Ltd., Karachi (PLD 1975 Kar. 819), the case of Anwar Ali Khan v. Abdul Sattar Abu Bakar (PLD 1968 Kar. 154), and the case of Messrs Kaysons v. Ahmed Juvenile Industries (PLD 1963 Kar. 767). The first case is a D. B. Judgment, in which, it was held that the plaintiff was not entitled to recover any amount from the carrier without proving the actual loss suffered, namely the price of the goods short landed. Whereas, the other two cited cases related to the recovery of damages on account of breach of contracts of sale of immovable property, in which it was held that the plaintiff could not recover any damage without proving the loss suffered by him. On the other hand, it has been urged by Mr. Vahani that the survey report Exh. 6/12 which has been produced by defendant No. 2 proves the amount of loss.
It may be observed that in para. 6 of the survey report, it has been mentioned that invoice value Rs.
34,125.15 dated 16-2-1971". This is in reply to the question contained in para. 6 to the effect, "has the shipping invoice been inspected by the undersigned (give particulars)". Whereas para. 12 contains query about the market value and it is worded "arrived sound market value", to which reply is that, invoice value Rs. 34,125.15. It has been urged by Mr. Tejani that the valuation given in the survey report is the reproduction of the information contained in the invoice and, therefore, 6 the same cannot be relied upon. On the other hand, it has been urged by Mr. Valiani that Exh. 6/12 being defendant No. 2's document, if it can be relied upon for other purposes, it can also be relied upon for purposes of determining the value of the consignment in question. It may be pertinent to mention that Exh. 6/12 was produced through P.'W. 1 by the learned counsel for defendant No. 2 during the cross-examination of the above witness, but no cross-examination was directed on the question that the value of the consignment given in the above survey report did not reflect the correct value. In this view of the matter I am inclined to agree with the contention of Mr. Valiani that Exh. 6/12 being defendant No. 2's document can also be relied upon for the purpose of determining the value of the consignment. In my view the rulings cited by Mr. Tejani are distinguishable inasmuch as in the instant case there is some evidence on the record to arrive at the value of the consignment in question. My findings on Issues Nos. 7 and 8 are that the plaintiffs are entitled to recover the price of 281 bags from defendant No. 2, as the aforesaid bags were not delivered, and that the plaintiffs are entitled to recover a sum of Rs. 33,225 from defendant No. 2. My finding on Issue No. 10 is that the plaintiffs being the endorsee of the bill of lading of the consignment in question are competent to maintain the above suit for short landing.
12. Issue No. 11.-As defendant No. I have not led any evidence to prove that the promissory note or the agreement of hypothecation were executed by them on account of any misrepresentation on the part of the plaintiffs, my finding on this issue accordingly is in the negative.
13. Issues Nos. 9 and 12.-It has been vehemently urged by Mr. Lari that the plaintiffs cannot maintain action against defendant No. 1 without first returning the original bills of lading and other connected documents as without these documents defendant No. 1 could not have maintained any action against any of the parties. His further submission was that in any case the plaintiffs are not entitled to maintain any action against defendant No. I as the plaintiffs opted to file a suit in the District Court, Chittagong against other parties in respect of the three remaining con--signments in question for the recovery of Rs. 1,42,000. There is nothing on record to indicate what was the result of the above suit. If defendant No. 1 would not have executed the promissory note Exh. 6/4 and the hypothecation agreement Exh. 6/6, in my view the filing of the above suit by the plaintiffs without impleading defendant No. 1 as a party to the aforesaid suit might have been fatal to the present suit. However as the present suit is based inter alia on the promissory note there is presumption in favour of the plaintiffs. The burden of proof that the above promissory note was without consideration is on defendant No. 1. It may again be observed that defendant No. 1 have not led any evidence. However, Mr. Lari has urged that the burden of proof loses its significance when there is sufficient evidence on the record to arrive at a particular finding. It has been further urged by him that there is sufficient material on the record to prove that the promissory note was executed without consideration. In support of his above submission Mr. Lari has drawn my attention to the fact that the plaintiffs had filed the aforesaid suit in the District Court, Chittagong on 2-11-1971 Exh.6/10 and that if the aforesaid fact would have been disclosed by the plaintiffs, defendant No. 1 would not have executed hypothecation agreement Exh. 6/6. Even if I ignore the above hypothecation agreement Exb. 6/6, the promissory note Exh. 6/4 holds the field, inasmuch as it has not been proved by defendant No. 1 that on the date of the execution of the above promissory note i. e. On 10-7-1971 the plaintiffs had received any amount in respect of the three consignments in question, nor there is any evidence on the record to conclude that the plaintiffs have received any amount towards the aforesaid three consignments till to day, and, therefore, it cannot be urged that the above promissory note was without consideration. It was for defendant No. 1 to come forward as a witness and to explain under what circumstances the promissory note in question was executed. In the absence of any evidence I cannot hold that the aforesaid promissory note was without consideration. It may be pertinent to mention that defendant No. 1 could file a suit or counterclaim for damages on account of the plaintiffs' failure to return the bills of lading and other documents in respect of the aforesaid 3 consignments, but the promissory note, cannot be defeated because of the plaintiffs' above failure. In my view the plaintiffs have, independent cause of action on the above promissory note. <p.m></p.m>