' The plaintiffs have brought this suit for the recovery of Rs, 59,98,252.97 with costs and interest.
' The brief facts of the case are that defendant No, 1, a company originally incorporated under the name of Bawany Woollen Textile Mills Ltd., who subsequently changed their name to Messrs Bawany Industries Ltd., in January, 1969 had opened an account, bearing No, B-1 with the plaintiffs/Bank, local branch, known as "Main Branch", Karachi.
' The above-mentioned account No, B-1, which was opened in December, 1956, was later on bifurcated, so that, for the pledge facilities, a separate account, bearing No, B-17, w as created on 21st April, 1972 and the account No, B-1 was utilised and continued to be for dealings which were secured by hypothecation of their various goods and articles.
In the account No, B-17, a sum of Rs, 17,11,500. Was debited by creating an equivalent credit in account No, B-1, which account is now the, subject-matter of the present suit. In Account No, B-1.
Several matter of the present suit. In Account No, B-1, several dealings took place, defendant No, 1 executed and delivered to the plaintiffs various documents from time, to time, which included hypothecation agreements, revival letters, promissory notes, acknowledgments of liabilities and written promises to clear the dues outstanding and payable to the plaintiffs.
' Defendants Nos. 2 to 7 are the guarantors for the repayment of the amounts, which may be found outstanding and payable by defendant No, 1 to the plaintiffs.
2. On the facts stated above, and other pleas raised in the plaint, it is the case of the plaintiffs that, the defendants were liable to pay Rs, 59,98,252.97, with costs and interest for recovery of which the plaintiffs brought the above suit.
3. Defendants Nos. 1 and 3 file their joint written statement, in which the amount claimed was not denied, and the only plea taken was that the liability created under the various documents in para. 4 (i) to (vi) had become barred by time, the mortgage was invalid and unenforceable against the defendants. And that the guarantee, if any, expired after the period of limitation. It was further stated that no valid acknowledgement of liability was made. The other defendants have not filed any written statement.
4. The only issue which the parties agreed to be tried vide Exh. 4 reads as follows :- "Whether the suit is time barred" ?
5. The plaintiffs in support of the case examined one Syed Ziauddin son of S. M. Tofazzzul Hussain, Manager of their Main Branch, Karachi. He produced various documents and also statements of account duly certified under the Banker's Evidence Act, which show that, at the time of filing of the suit, the defendants on their Account No, B-1 were liable to pay Rs, 59,98,252.97. The statement of the account No, B-1 produced is marked as Exh. 5/26, and is duly certified under the Banker's Books Evidence Act. The corrections of the account and the amount claimed in suit has not been challenged by the defendants except on the ground that the suit is barred by time.
6. In support of the plea that the suit is within time, Mr. Mansoorul Arfin, the learned counsel for the plaintiffs, however has relied upon a number of documents, which have been executed by the defendants and produced in evidence. According to the learned counsel, these documents which have remained unchallenged establish beyond any doubt whatsoever that the suit is within time. I, therefore, examine these documents upon which the learned counsel has relied and refer them in chronological rder :-
1. Exh. 5/9 is confirmation slip, dated 31st December, 1958, signed by defendant No, I wherein it is admitted by the said defendant that Rs, 79,31,422-1-6 were due to the plaintiffs by the said defendant.
2. Exh. 5/10 is a promissory note executed by defendant No, 1 on 2nd March, 1960. It is a promissory note 'executed by defendant No, 1 in favour of their directors Messrs (1) A. Latif E. Bawany, (2) A.
Majid Bawany, (3) Muhammad Amin Bawani, (4) Suleman A. Aziz Ghazi (5) A. Aziz Jamal, and (6)
Messrs Ahmed Bros. Ltd., jointly and severally, to pay to them or to their order at the National Bank of Pakistan, Local office, Karachi, a sum of Rs, 80 lacs with interest from the said date at 1 % above Bank rate minimum 5 % p. a. With monthly rests. This promissory note was duly endorsed by the above-named payees in favour of and delivered to National Bank of Pakistan the plaintiffs.
3. Exh. 5/11, dated 25th November, 1960 payable on demand by the defendant No, 1 to Messrs A.
Majid Bawany, Muhammad Amin Bawany, Suleman A. Aziz Ghazi, A. Aziz Jamal and Messrs Ahmad Bros. Ltd., jointly and severally to pay to them or to their order Rs, 70 lacs with the same rate of interest as mentioned in Exh. 5/10. This promissory note was endorsed in favour of and delivered to the plaintiffs for payment to them by the payees named above.
4. Exh. 5/12, dated 12th December, 1961, is a promissory note payable on demand by defendant No, 1 to Messrs A. Majid Bawany, Muhammad Amin Bawany, Suleman A. Aziz Ghazi, A. Aziz Jamal and Messrs Ahmad Bros. Ltd., jointly and severally or to their order Rs, 30 lacs at the same rate of interest as mentioned above. This promissory note was also endorsed in favour of and delivered to Messrs National Bank of Pakistan for payment to the plaintiffs by the payees named therein.
5. Exh. 5/13, dated 30th December, 1963, is promissory note payable by the defendants No, 1 to Messrs Abdul Majid Bawany, Muhammad Amin Bawany, Suleman A. Aziz, Abdul Aziz Jamal and Messrs Ahmad Bros. Ltd., jointly and severally or order, Rupees one crore for value received at the same rate of interest as mentioned above in Exh. 5/12. This promissory note was similarly endorsed in favour of and delivered to the plaintiffs for payment to them by the payees named therein.
6. Exh. 5/14, dated 30th'June 1964, is a document whereby defendant No, 1 confirmed that the balance in their account was Rs, 99,88,319.50 and defendant No, 1 confirmed that the said amount was due by them to the plaintiff/Bank.
7. Exh. 5/15, dated 29th October, 1964, is a promissory note, whereby defendant No, 1 promised to pay to Messrs A. Majid Ahmad Bawany, Muhammad Amin Ahmad, Sulleman A. Ghazi, A. Aziz Jamal and Ahmed Bros. Ltd., jointly and severally, Rs, 25 lacs with interest at 1 per cent. Above Bank rate Minimum 5 % per annum with monthly rests. This promissory note was endor sed in favour of and delivered to the plaintiffs for payment to them by the payees named therein.
8. Exh. 5;16, dated 30th September, 1966 is a confirmation slip, whereby defendant No, I confirmed that the balance payable by them on their above mentioned account was Rs, 1,24,29,500.92, and defendant No, 1 admitted that this amount was due by them to the plaintiff/Bank as shown in their statement of account as on that date.
9. Exh. 5/17, is promissory note, dated 31st October, 1966 whereby the defendant No, 1 promised to pay to Messrs A. Majid Ahmad Bawany, Abdul Wahid Bawany, S.M. Sayeed, Muhammad Amin Ahmad, Suleman A. Ghazi and Ahmad Bros. Ltd., Rupees one crore fifty lacs with interest at 21 per cent above Bank rate Minimum 7i per cent per annum with monthly rests. This promissory note was also endorsed in favour of and delivered to the plaintiff/ Bank by the payees named therein with a direction to make payment to the plaintiffs.
10. Exh. 5/18, dated 6-5-1968 is a document, whereby defendants No, 1 confirmed that Rs, 1,00,89,714.60 was due by them to the plaintiffs/Bank as per statement of account dated 29-2-1968.
11. Exh. 5/19, is a revival letter executed on 6-5-1968 by defendant No, 1, whereby defendant No, 1, with reference to Exh. 51 17 endorsed in favour of the plaintiffs, acknowledged for the purpose of section 19 of the Limitation Act that defendant No, I was liable to pay to the plaintiffs the amount mentioned in the said promissory note, dated 31st October, 1966, Exh. 5117 with interest in respect of present and future indebtedness and liabilities secured thereby, which promissory note they agreed shall remain in force with all relative securities, agreements and obligations.
' On 6th May, 1968, the payees named in the promissory note dated 31st October, 1966, Exh. 5/17, also acknowledged their liability and promised to pay to the plaintiffs Rs, 1,50,00,000 within the meaning of section 19 of the Limitation Act on the said promissory note with interest. They further agreed that their present and future indebtedness and liabilities secured by the promissory note, Exh. 5/17, were to remain in force with all relative securities, agreements and obligations.
12. Exh. 5/21, is a promissory note, dated 20th September, 1969, which defendant No, 1 executed promising to pay on demand to Messrs A. Majid Ahmad Bawany, A. Wahid Bawany, S. M. Sayeed, Suleman A. Ghazi, Muhammad Amin Ahmad, A. Rauf Ahmad and Ahmad Bros. Ltd., the sum of Rupees Seventy five lacs for value received with interest from the said date at 3 1/2 above Bank rate minimum 8 1/2 per cent, per annum with quarterly rests. This promissory note was also endorsed in favour of and delivered to the plaintiffs for payment by the above named payees.
13. Exh. 5/22 is a confirmation slip, whereby the defendant No, 1 confirmed that they were liable to pay to the plaintiffs Rs, 1,02,66,996.72 as shown in their account on 31st May, 1976. They confirmed that this amount was due by them to the plaintiffs.
14. Exh. 5/23 is yet another confirmation slip, whereby defendant No, 1 confirmed that the balance of their cash credit account on 29-12-1977 was Rs, 52,72,958.32, and they further acknowledged and stated that this amount was due by them to the plaintiff/ Bank as shown in the statement of account of that date.
7. The above-mentioned documents, clearly show that from time to time defendants No, 1 admitted and acknowledged their liability in writing, and further promised from time to time in writing to make the payments., and that throughout the period from 31-12-1958 to 29-12-1977 the liability of defendants No, 1 to pay the outstanding dues claimed by plaintiffs was not only kept alive by defendant No, I by acknowledgments in writing but they also made written promises to the plaintiff/Bank for making payment of the dues outstanding against defendants to the plaintiffs on their account No, B-I.
8. The last document executed by defendant No, 1 in the series is Exh. 5/23, which is an acknowledgement in writing by defendant No, 1 that on their said account as on 29-12-1977 they were liable to pay Rs, 52,72,958.32, and that the said amount was due by them to the plaintiffs as shown in the statement of account on that date. Thus, it has been satisfactorily shown by the plaintiffs, that not only the liability was kept alive for purposes of computing period of limitation for filing suit but from 29-12.1977, a fresh period of limitation has to be computed.
' The suit is for recovery of Rs, 59,98,252.97 which had accrued between the period of signing of the document acknowledgment by defendant No, 1 on 29-12.1977 till the filing of the suit on 20th November, 1978.
' Accordingly, it is held that the suit against defendant No, 1 is within time.
9. As regards defendants 2 and 7, these persons are the guarantors, but the question, which remains for consideration is that whether the suit against them is within time. Defendants 2 to 7 executed a deed of guarantee in favour of the plaintiffs/Bank. In the aforesaid guarantee, the said defendants 2 to 7 confirmed and agreed that at their request, the plaintiffs had agreed to grant to defendant No, 1 accommodation by way of cash credit to such an amount from time to time as the plaintiffs/ Bank in his discretion shall think proper on such condition that such cash credit shall to the extent of Rs, 85,00,000 and interest be secured by the promissory note, and that the said guarantors had delivered to the plaintiffs a promissory note for Rs, 85,00,000 with interest payable on demand made by the borrower:defendant No,
1. The guarantors/defendants 2 to 7 confirmed that they had endorsed the promissory note in favour of the plaintiffs/Bank and that the guarantee shall be considered continuing notwithstanding it may in the meantime at any time or from time to time be brought to credit until notice in writing that the same is closed is given by the Bank to the said defendants (i.e, the guarantors) on the understanding that the Bank shall be at liberty to take steps to enforce payment of the said promissory note at any time after notice in writing demanding payment thereof posted to them at their usual or last known address and default being in payment for three days after the posting of such notice. They (guarantors) further agreed that the fact of the Bank not taking steps no enforce payment of the said account or of the said promissory note until expiry of a period of three days after posting of such notice or otherwise granting time to the borrower or any other obligant or guarantor shall in no way release them from their liability under the said promissory note. It was also agreed by these guarantors/ defendants Nos. 2 to 7 that it shall not be necessary for the bank to present the said promissory note for payment to the borrower or any other obligant or guarantors before demanding payment from them or suing them thereon. The letter of guarantee has been produced and marked as Exh. 5/7.
' Defendants Nos. 2 to 7 executed another letter of guarantee with the same terms and conditions, which is Exh. 5/8, dated 8th July, 1974, in which also the conditions which have been referred to above, guaranteeing repayment and agreeing with the plaintiffs/Bank that they/plaintiffs shall be at liberty to take steps to enforce payment of the promissory note of 23-4-1970 for Rs, 75 Lacs at any time after notice in writing demanding payment was posted to them and default was made in payment for three days after posting of such a notice. The promissory note referred to in this document is Exh. 5/10, dated 2nd March, 1960.
10. On 13th June, 1977, the guarantors vide Exh. 5/25, with reference to the cash credit/overdraft account of defendant No, 1 wrote to the plaintiffs/Bank that the said overdraft was secured by the Bank by a promissory note dated 8th July, 1974 for Rs, 80,00,000 with interest executed by defendant No, 1 in favour of the guarantors, who had endorsed and delivered the same to the plaintiffs, for payment and while acknowledging their liability and to make the payment defendants Nos. 2 to 7 as guarantors addressed the plaintiffs, as follows :- "We acknowledge for the purpose of the Limitation Act IX of 1908 and like Limitation Law in order to preclude any question of Limitation Law that I amlwe are liable to you for payment of the said Promissory Note with interest and the same is to remain in force with all relative securities agreements and obligations."
11. It would thus be seen that the liability of the guarantors arose, continued and was kept alive Exh.
5/7 dated 9th August, 1973, Exh. 5/8, (laced 8th July, 1974, and finally by their letter of revival dated 13th June, 1977, which is marked Exh. 5/25, whereby they acknowledged their liability to pay the amount to the plaintiffs/Bank to the extent of Rs, 80,00,000 as guarantors for payment for and on behalf of defendant No, 1 on the cash credit overdraft account in question. It is also established by the terms and conditions of the documents Exh. 57 dated 9th August, 1973, and Exh. 5/8 dated 8th July, 1974, that the guarantors have expressly acknowledged their liability in writing to make the payment of the amount guaranteed by them, and further agreed that the plaintiffs/Bank shall be entitled to enforce against them the payment of the amount due by defendant No, 1 borrower on the account, or, on the promissory note until expiry of the period of three days after posting of notice by the plaintiffs.
' In para. 9 of the plaint, it has been pleaded by the plaintiffs that the defendants Nos. 2 to 7 were called upon by the plaintiffs by notices dated 7-12-1977, which notices were posted on 8-12.1977, and that the said defendants Nos. 2 to 7 failed to make the payment according to the letters of guarantee by 11-12-1977. In the written statement, defendants Nos. 1 and 3 have not raised any plea denying specifically the demands made by the said notices, and the vague denial cannot be considered to be the denial of the specific plea made in the plaint by the plaintiffs, and accordingly in view of Exh, 5/7, and Exh. 5/8. Dated 9th August, 1973 and 8th July, 1974 respectively and further in view of the revia I letter Exh. 5/25 executed on 30th June, 1977 coupled with the plea contained in para. 9 of the plaint, it is fully established that the suit filed by the plaintiffs against defendants Nos.
2 to 7 as guarantors also, is within time.
12. It may also be added here that the facts, which have been narrated above and deposed to by the plaintiffs' witness Syed Ziauddin (Exh. 5) have not been disputed by the defendants. The evidence of the plaintiffs' witness' was recorded on 4.2-1981, and his examination-in-chief was completed on the same day. The case at the request of the advocate for defendants was adjourned to enable the counsel to cross-examine the said witness. The case thereafter, was adjourned from time to time at the request of the learned counsel for the defendants. Ultimately on 7th April 1981, the learned counsel for the defendants, Mr. S.H. Rizvi, stated that he did not wish to cross-examine the said witness (Syed Ziauddin) who as noted above was examined in the Court on 4-2-1981.
' On the same day (4-2-1981) Mr. S. H. Rizvi, the learned counsel for the defendants, further stated that he did not propose to examine any witness on behalf of the defendants. The evidence of the defendan is was accordingly closed, and the case was adjourned for arguments.
13. It would thus be seen that the defendants, who are executants of the documents and personally know the facts of the case, have chosen to remain absent, and have also not submitted themselves to cross-examination. The honourable Supreme Court of Pakistan in the case of Mst- Khair-ul-Nisa and 6 others v. Malik Muhammad Ishaque and 2 others (1) cited with approval the following observations of the learned High Court of Peshawar in the case Haji Abdullah Khan and others v. Nisar Muhammad Khan and others (2): "It is a settled law that it is the bounden duty of a party personally knowing the whole circumstances of the case to give evidence on his behalf, and to submit to cross-examination. His non-appearance as a witness would be the strongest possible circumstance going to discredit the truth of his case."
Relying upon the above principle laid down by the honourable Supreme Court of Pakistan, and in view of the unchallenged statement made by the plaintiffs witness the only inescapable conclusion is that defendant D No, 1 as a principal borrower and defendants Nos. 2 to 7 as the guarantors are jointly and severally liable to pay to the plaintiffs the sum of Rs, 59,98,252.97.
(1) PLD 1972 SC 25 (2) PLD 1959 Pesh. 81
14. Accordingly, for the reasons stated above, the plaintiffs' suit is decreed for Rs, 59,98,252.97, against the defendants jointly and severally with interest at 14% per annum with quarterly rests from the date of the suit till payment.
' The defendants shall also be liable to pay costs of the suit.