' The plaintiffs have brought his suit claiming the following reliefs
(a) A declaration that the property in suit (i,e, plot of land with buildings and structures thereon bearing Survey No, 123 Survey Sheet O.T. 8 measuring 409 sq. Yards or thereabouts) is mortgaged with the plaintiff and is the subject-matter of a charge and is charged with the plaintiff for the payment of Rs, 1,49,797.81 with future interest at 13 per cent per annum with quarterly rests, costs, charges and expenses, which may accrue and become due to the plaintiff ; (plus another sum of Rs, 1,15.413.66 which is the subject-matter of a separate suit on the basis of another account of the sister concern).
(b) Decree under Order XXXIV, rule 4, C. P. C. In respect of the said mortgaged property in .Form 5-A in Appendix 'D' to the First Schedule thereto.
(c) An order that in case of deficiency and/or in case the said mortgaged property cannot be sold, the decretal amount and/or balance of the decretal amount be paid by the defendants jointly and/or severally to the plaintiff.
(d) Cost of the suit including costs of the preliminary decree and final decree and of sale of the property mortgaged with the plaintiff and/ or of incidental charges and future interest.
(e) In the alternative, the plaintiff claims from the defendants jointly and/or severally Rs, 1,49,797.81 with interest at 13 per cent per annum with quarterly rests from the date of the suit till payment and costs.
(f) Such other and/or further relief which on the facts disclosed above and/or under the circumstances of the case this Honourable Court may find the plaintiff entitled to and/or this Honourable Court may deem fit and proper to grant.
1. The brief facts stated as disclosed in the plaint are that the defendant No, 1 is a partnership firm and the defendants Nos. 2 to 5 are and were at all material times, partners of the said firm. The defendant No, 3 created equitable mortgage over his property (Survey Nos. 123, SS-O.T. 8 Karachi) in favour of the plaintiff, as security for repayment of loan/overdraft credits. Defendants Nos. 2 to 5 executed and delivered to the plaintiff, letter dated 7th March, 1974 to the effect that the said defendants are the partners of defendant No, 1 and are jointly and severally liable to the plaintiffs for the liabilities of the defendant No, 1.
' It was further pleaded that the defendant No, 1 maintains a current mutual and open Account No, 3007 with the plaintiffs at their Cloth Market Branch, Kalrachi and that the defendant No, 1 enjoyed an overdraft facility ranging from Rs, 25,000 to 1,00,000 against the security of hypothecation of goods and export licence which facility was increased in March, 1972 to the extent of Rs, 1,50,000 and the defendants agreed to repay the amount with interest on the amount overdrawn at the rate of 4% per annum over and above the State Bank of Pakistan rate with a minimum of 9% per annum with quarterly rests. On 31st July, 1973 according to the plaintiffs the overdraft facility was reduced to Rs, 1,00,000.
' According to the case pleaded in the plaint there is another firm known as Green Garments Manufacturers (Pakistan) of which defendants Nos. 3 and 4 are and at all material times were partners. This firm maintained another account of its own being account No, 6195 in which this firm (which is described in the plaint as the sister concern of the defendant No, 1) enjoys overdraft facility to the extent of Rs, 85,000. It has been disclosed in the plaint that a separate suit was filed against the other firm on the same date when the present suit was filed against the present defendants.
' On 7th March, 1974 according to the plaintiffs, a sum of Rs, 79,914.88 was due and payable by the defendants in the said overdraft account No, 3007 and as additional security, acknowledgment of the debt and promise for the repayment of the said amount and/or for the repayment of the amount overdrawn and/or the ultimate balance remaining unpaid, the defendant No, 1 executed and delivered to the plaintiffs two covering letters alongwith Demand Promissory Note dated 7th March, 1974 for Rs, 79,914.88 carrying interest at the rate of 4 per cent per annum over and above the State Bank of Pakistan rate with minimum of 13 per cent per annum with quarterly rests.
' On the same day i,e, 7th March, 1974 the defendant No, 3 in order to secure the repayment of the loan amount outstanding against the firm of Green Garment Manufacturers as well as against the defendant No, 1 with the intention of creating equitable mortgage of his immovable property i,e, property bearing No, 123 Survey Sheet O. T. 8 measuring 409 sq. Yards situated at Karachi deposited the documents .Of title relating to the said property with the plaintiffs and also executed and delivered a memorandum of Deposit of Title Deeds dated 7th March, 1974 in respect of the two accounts. Promissory Note is Exh. 5/1.While the memorandum of deposit of articles is marked Exh.
5/2. The letter of guarantee Exh. 5/8 was also executed by defendant No, 3 wherein it was stipulated that the said guarantor/defendant No, '3 shall make payment within two days of all money due at any time to the plaintiff bank.
2. On the plea that as on 30th September, 1975 a sum of Rs, 1,28,504.15 was due and payable by the defendants jointly and severally to the plaintiff in the said overdraft account and that another sum of Rs, 98,688.15 was due in account No, 6195 against Messrs Green Garment Manufacturers (Pakistan), two separate suits were filed, against these two firms in which their respective partners were also joined as defendants. The present suit has been numbered as 761 of 1976 which is against Messrs Green Hosiery Mills and its four partners. One of the partners Mr. Rahmatullah died during the pendency of the suit and his legal representatives have been brought on the record as defendants No, 5(i) to (vi).
3. The other suit filed against Messrs Green Garment Manufacturers ,(Pakistan), was registered as Suit No, 762 of 1976, which was decreed on 8th May, 1978 and its judgment is reported in PLD 1978 Kar.
1027.
4. In the present suit the defendants Nos. 1, 3, 4 and 5 have filed their written statements. The defendant No, 2 has died during the pendency of the case. In the written statement several pleas have been taken. It is pleaded that the suit is not maintainable under Order XXXIV, C. P. C. That the suit has not been properly instituted, the suit is bad for misjoinder of parties, and that the blank documents were obtained by the plaintiffs in order to lend support to their claim. It was further pleaded in defence that the Defendant No, 1, a partnership firm (with defendants No, 2 to 5 as partners) stood dissolved w. e. f. 31st March, 1975. It was also pleaded that the Defendant. No, 3 could not have executed any equitable mortgage as the said defendant on the showing of the plaintiffs was the guarantor of defendant No, 1 and as such the defendants are not liable to the plaintiffs any alleged liabilities. It was further averred that in any case the defendants No, 2 and 5 are not liable for any amount as they ceased to be the partners of the firm w,e,f, 3 It March, 1975.
The execution of the promissory note by Defendants Nos. 3 and 4 on 7th March, 1974 and creating of equitable mortgage as security for the overdraft facilities by Defendant No, 3 and execution of delivery of letter of guarantee were also denied. It was further stated that the plaintiffs unauthorisedly and illegally filled in the blank pronote. The liability and delivery of the promissory note and other documents were denied.
5. On the pleadings of the parties the following issues were framed :-
(1) Whether the suit is not maintainable and/or barred by any provision of law ?
(2) Whether the plaint has not been signed and verified by the competent person ?
(3) Whether the pronote, other documents and the Memorandum of deposit of Title Deeds were executed on the date specified in them ? If so, what is its effect ?
(4) Whether the defendants have made any acknowledgment of their liabilities ? If so, what is its effect ?
(5) To what relief or reliefs, if any, the plaintifis are entitled to ?
6. The plaintiffs in support of their case examined Muhammad Muniruddin, an Officer in the plaintiff-bank, who has also produced a photo copy of the power-of-attorney Exh. 5/1. The said witness produced document signed by the defendants No, 2 to 5 stating therein that they are the partners in the defendant No, 1 firm and that they are jointly and severally responsible to the bank for the liabilities of the firm with the bank and that the plaintiff-bank may recover its claim from the estate of any or all of the partners of the firm. These Defendants also undertook to inform the bank if any change occurred in the partnership and they would inform the Bank of the same in writing and that their individual responsibility to the plaintiff-bank will continue until they receive from the bank an acknowledgment of their letter and until all their liabilities with the bank are fully disharged. After giving the details of the overdraft facilities granted to the defendant No, 1 from time to time the plaintiffs said witness deposed that a balance of Rs, 79,914 was due as on 7th March, 1974 he produced a certified copy of the statement of account as Exh. 5/3. He also produced the documents executed by the Defendant No, .1 as Exhs. 5/4 and 5/6. The certified copy of the memorandum of deposit of the title deeds creating equitable mortgage was produced as Exh. 5/7, the original having been already produced and exhibited in Suit No, 762/76. According to the statement of account filed as Exh. 5/8 the plaintiff's witness pointed out that as on 30th December, 1975 a sum of Rs, 1,28,504.15 was outstanding. The plaintiff bank served a demand notice upon the defendant No, 1 on 7th January, 1976 which was acknowledged by the said defendants vide their letter dated 21st January, 1976 wherein the defendant No, 1 after explaining the difficulties which they suffered in their transactions with the foreign parties stated as follows :- "Under the above circumstances you will realise our position and allow us 6 months' time for adjustment of the above outstanding liabilities and we assure you that in the meantime if we receive any amount we will adjust against the above accounts.
' Hope you will consider our request sympathetically and grant us the time as requested above for which we shall remain grateful to you."
7. The defendants chose not to lead any evidence in defence.
8. Mr. Tirmizi the learned counsel for the defendant with great emphasis argued that the suit as framed under Order XXXIV, C. P. C. Was not maintainable as under section 67-A of the Transfer of Property Act the mertgagee/plaintiffs were bound to bring one suit in respect of the equitable mortgage created by Exh. 5/7 for the money which became due and which mortgage covered claims in Suit No, 761/76 against Messrs Green Hosiery as well as in Suit No, 762/76 filed by the plaintiffs against Messrs Green Garment Manufacturers (Pakistan). Proceeding further the learned counsel submitted that Suit No, 762/76 has already been decreed and thus the present suit is not maintainable.
9. Mr. Nafisuddin the learned counsel for the plaintiff however submitted that in the present suit the parties are different from those in Suit No, 762/76 and that in any case the plaintiff would not insist to claim a mortgage decree under Order XXXIV, C.P.C. And would be satisfied with the passing of the money decree against the defendants for which they made a prayer in the alternative in sub- clause (e) of the prayer clause in the plaint on the basis of promissory note and the letters of guarantee produced in the case. He therefore referred to the promissory note which has been executed as Exh. P. 5/4 by the Defendant No, 1 whereby the said defendant promised to pay on demand to Messrs Habib Bank Limited the sum of Rs, 79,914.88 with interest at the rate of 4% per annum over the published State Bank of Pakistan rate with a minimum of 13% per annum with quarterly rests. The learned counsel submitted that his clients have claimed interest @ 13% per annum with quarterly rests and therefore it is not necessary to prove the rate of interest as published which according to the learned counsel for the defendants ought to have been proved as laid down in PLD 1980 Kar.
143.
' I am in agreement with the arguments advanced by Mr. Nafisuddin the learned counsel for the plaintiff that since the claim is sought to be enforced on the basis of promissory note dated 7th March, 1974 for Rs, 79,914.88 as outstanding on that date with interest rate minimum at 13% per annum with quarterly rests, he is not required to prove the rate published by the State Bank of Pakistan in the circumstances of the case. The document Exh. 514 (promissory note) is supported by the letter of delivery of the same date which has been exhibited as Exh. 5/5 which is duly signed by the defendant No, 1 and is also by the covering letter dated 7th March, 1974 signed and delivered by the defendant No, 1 to the plaintiff bank.
' In the circumstances the issue No, 1 is to be answered in the negative to the extent that the suit on the basis of the promissory note is maintainable and that it is not barred by any provision of law.
Section 67-A of the Transfer of Property Act would not come in the way of the plaintiffs to bring a suit for relief on the promissory note on which basis alternate claim has expressly been made in the plaint.
10. Re : Issue No, 2-When pointed out that the plaint has been signed by two officers, one of whom is Muhammad Muniruddin who is a Principal Officer of the plaintiff bank and holds the power-of- attorney and knows the facts of the case the learned counsel for the defendants did not press this issue in view of provisions of Order XXIX, C. P. C. The issue is therefore answered in the negative.
11. Re : Issue No, 3-For determination of the above issue we may refer to the evidence of P. W.
Muhammad Muniruddin. He has produced Exh. 5/2 which is a declaration signed by the defendants No, 2 to 5 declaring themselves to be the partners of the defendant No, 1 firm and they expressly undertook to discharge all the liabilities of the defendant No, 1 firm and further agreed that until they receive from the bank an acknowledgment of the letter and until all their liabilities with the bank were fully discharged, they would be liable to the bank individually to pay off all the dues. He further deposed that the documents Exh. 5/4 to 5/6 i,e, promissory note, letter of Delivery of the promissory note and the covering letter was executed by the defendant No,
1. The execution of these documents by the Defendant No, 1 has not been challenged in the cross-examination. The witness was cross-examined at length but it is significant to note that not a single question was suggested to this witness that the documents referred to above namely Exh. 5/4 promissory note and the other documents Exh. 5/5 and 5/6 or any of the other documents was/were obtained in blank from the defendants or was/were subsequently filled up by the plaintiffs unauthorisedly or illegally. In the absence of any cross-examination it does not lie in the mouth of the defendants to suggest in arguments that any of the documents should be declared to have been signed in blank by them, and that the same were unauthorisedly filled up by the plaintiffs subsequently. It may also be pointed out that under section 20 of the Negotiable Instruments Act the plaintiffs to whom the promissory note was delivered wholly blank or having written thereon an incomplete negotiable instrument, in order that it may be made or completed into a negotiable instrument, gives prima facie authority to the person who receives that paper to make or complete it, into a negotiable instrument for the amount if any, specified therein, not exceeding in either case the amount covered by the stamp.
' I am satisfied on the evidence on record that any of the mentioned documents was not incomplete and further hold that the Defendants had executed and delivered the said documents in the form in which they have been produced and exhibited. This conclusion is fortified from the fact that none of the defendants have come forward to give evidence on their own behalf to support the plea taken by them. On the contrary they have chosen to remain absent and have not submitted to cross-examination. Their non-appearance as witnesses in the case is the strongest possible circumstance going to discredit the truth of their case set up in defence. If any authority is needed in support of the above principle reference may be made to the case of Mst. Khairun Nisa v. Muhammad Ishaque.
' For the reasons stated above coupled with the undertaking given by the defendant No, 1 vide their letter dated 21st January, 1976 Exh. 5/15 wherein they admitted the claim and requested for time of six months to enable them for adjustment of the outstanding liabilities and to pay off the amount, leaves no doubt what's over that the defendants are liable to pay the amount claimed in the suit. It would be worth mentioning here that the above undertaking was given in reply to the plaintiff's letter dated 17th January, 1976 (Exh. 5/9) whereby the defendants were informed that an amount of Rs, 1,28,504.15 was then outstanding against them and that they should pay the same within 7 days from the receipt of that notice.
' The last document which may be referred to here is the statement of account filed by the plaintiffs which is marked .Exh. 5/3. The said document is certified to be a true copy of the entries contained in the ordinary books of accounts of the bank which entries were made in the usual and ordinary course of business and that such books are still in the custody of the bank.
12. Mr. Tirmizi the learned counsel for the defendants submitted that the statement of account filed the plaintiff does not conform with the requirement of section 4 of the Bankers' BOOK of Evidence Act, 1891 inasmuch as it does not show the number of cheques which are alleged to have been drawn in the said account. I am afraid this argument of the learned counsel cannot be accepted for the reason that no such question was put to the plaintiff's witness in the cross-examination and also because it is not the requirement of section 4 of the Bankers' Book of Evidence Act that the ledger account should show the number of cheques which have been drawn in the account.
According to section 4 of the above Act the certified copy of any entry in a banker's book shall in all1 legal proceedings be received as prima facie evidence of the existence of such entry, and shall be admitted as evidence of the matters, transactions and amounts recorded therein in every case to the same extent as the original entry itself. If the defendants were not satisfied with the statement of account Exh. 5/3 duly certified as required by the above-mentioned section 4, they could have cross-examined the plaintiffs witness and should also have applied for inspection of the original .Books of accounts under section 6 of the said Act. This issue No, 3 therefore is answered in the negative.
13. Re : Issue No, 4-The acknowledgment referred to in this issue according to Mr. Nafisuddin, Advocate for plaintiffs is proved by document marked Exh. 5/15 which is dated 21st. January, 1976.
This document is signed by the defendant No, 1 acknowledging their liability and promising to pay the outstanding amount. This letter was written in reply to the plaintiff's demand notice dated 17th January, 1976 (Exh. 5/9). I have already reproduced above the undertaking given and promise made by the Defendant No,
1. The acknowledgment of the liability and promise to pay the outstanding dues to the plaintiffs in writing have been fully proved.
' This issue is, therefore, answered in the affirmative.
14. Re : Issue No, 5-The plaintiff's counsel has made statement that he does not press the relief in the suit on the basis of the mortgage (Exh. 5/7) and accordingly no more decree is required to be passed in terms of prayer, clause a, b, c & d of prayer clause 18 of the plaint.
' The suit is accordingly decreed for Rs, 1,49,797.81 in favour of the plaintiffs and against the defendants jointly and severally with interest at the rate of 13% per annum with quarterly rests from the date of the suit till judgment with costs. PLD 1972 SC 25