' The plaintiff a Banking Company has brought the above suit for recovery of Rs, 3,87,762.74 with interest at the rate of 9% per annum with quarterly rests from the date of the institution of the suit till payment. It has prayed that the pledged stock of paper be sold and the sale-proceeds after defraying out the sale expenses be applied towards the payment of the decretal amount. Cost of the suit has also been claimed. The suit has been brought on the facts which briefly are stated as follows:--
1. The defendant No,1, who is the sole proprietor of the concern known as Messrs Sarfaraz Khan, had and still has a cash credit account with the plaintiff's local branch while the defendant No,2 is the guarantor of the said defendant No,1.
' The plaintiff granted two cash credit facilities to the defendant No,1. The first facility was granted on 20-8-1958 for a sum of Rs,20,000 in which account a sum of Rs, 16,694.97 remained outstanding against the defendant No,1 which amount was transferred on or about 18-6-1962 in his other cash credit account.
' The other cash credit account referred above commenced on 6-4-1960 when at the request of the defendants, the plaintiff granted a cash credit facility of Rs, 75,000 to the defendant No,1 which limit was subsequently enhanced at the request of the defendants on or about 2-5-1961 to Rs, 1,50,000 on or about 5-6-1965 to Rs,2,25,000 and thereafter on or about 17-8-1965 to Rs,3,00,000. It is the case of the plaintiff and not denied by the defendants that the defendant No,1 utilized the said limits in full by withdrawing the various amounts from his said account from time to time.
2. According to the averments made in the plaint the defendant No,1 as security for the repayment of the plaintiff's dues which may be found payable by him to the plaintiff executed the following documents:-- "(i) Agreement of Cash Credit, dated 5-4-1960.
(ii) Another Agreement of Cash Credit, dated 5-4-1960.
(iii) Promissory Note dated 25th August, 1965 for Rs,3,00,000 payable on demand to the defendant No,2 or order with interest thereon at the rate of 3 per cent above Bank rate minimum 8 per cent per annum with monthly rests. The said Promissory Note, according to the plaintiff, was duly endorsed by the defendant No,2 in its favour.
' Agreement for Cash Credit, dated 25-8-1965 signed by the, defendant No,l."
3. The plaintiff has also pleaded that the defendant No,1 acknowledged his liability and promised to pay the plaintiff's dues in writing on 30-6-1964 and 31-7-1965 and that the defendant No,2 in acknowledgment of his liability to pay the plaintiff's dues and as guarantor of the defendant No,1 executed the guarantee, dated 25-8-1965 thereby guaranteeing that the plaintiff's dues which may be found due and payable from the defendant No,1 shall be paid to the plaintiff by him
4. The plaintiff has further pleaded that the defendant No,1 also pledged with it his stock of papers which was stored by him in a godown rented by him, situated,at Lawrence Road, Karachi and that the said stock was taken in possession by the plaintiff on the basis of the statement of the defendant No,1 regarding its contents and quality. It is also pleaded that the defendant No,1 had agreed that any defect, shortcoming or inaccuracies as to the quality and quantity if found in stocks pledged, he alone shall be responsible for the same. The plaintiff further pleaded that subsequently it was discovered that the quality of the paper pledged by the defendant No,1 was not the one which was declared by the defendants but of much inferior quality and that he had deliberately and wrongly declared the quality of the goods to be superior though to the knowledge of the defendant No,1 the said stocks were of much more inferior quality. A survey was stated to have been carried out, the report of which given on 14-3-1968 has been produced alongwith the plaint. The plaintiff also produced with the plaint details of the stocks of papers in its possession in a list marked "J" with the plaint.
' The plaintiff has also relied upon the defendant's writing, dated 14-3-1968, according to which it is the case of the plaintiff that the said defendants acknowledged their liability and promised to pay the plaintiff's dues which may be found due by them to the plaintiff on the basis of the Promissory Note, dated 25-8-1965.
5. Relying upon the facts thus pleaded in the plaint the suit as filed in this Court on 12-3-1971 claiming the reliefs mentioned above. The defendant No,1 in his written statement admitted that the cash credit facility was granted to the said defendant the limit whereof was subsequently raised to Rs, 3,00,000. As regards the other facility for Rs,20,000 pleaded by the plaintiff to have been granted, the defendant No,1 contended that in the absence of full particulars he was unable to make a specific denial. He, however, without prejudice to this plea submitted that the alleged transfer of the alleged sum of Rs, 16,694.97 to the cash credit account of the defendant No,1 by the plaintiff was illegal and unauthorised and not binding on him.
' As to the execution of various documents mentioned in the plaint it was pleaded by the defendant No,1 that the same was involuntary and that the said documents were obtained by the plaintiff through its undue influence knowing that in the then existing circumstances the said defendant was in urgent financial needs. It was accordingly submitted that the said documents are void and inoperative against the defendants.
' As reagards the pledged stocks it was pleaded by the defendant No,1 that the same were inspected by the Inspector and Superintendents reputed by the plaintiff and on each occasion the said stocks were found to be according to the declared stocks.
' As regards the survey made, to which reference was made in the plaint, it was pleaded by the defendant No,1 that it was obtained behind the back of the defendants and without their knowledge and as much not binding on them.
' As regards the writings, dated 14-3-1968 whereby the defendants, according to the plaintiff, had acknowledged their liability and promised o pay the plaintiff's dues, it was pleaded by defendant No,1 that the aid writings are void as they were obtained by the plaintiff through version, by misrepresentation and undue influence. The statement of account filed with the plaint was also denied.
5. The defendant No,2 filed a separate written statement in which admitted that he is the guarantor of the defendant No,1 which grantee, if any, stood discharged. It was further pleaded by defendant o.2 that on the death of his father in 1964 was asked to sign the guarantee in lieu of the earlier guarantee given by his late father and s such the said guarantee is void and illegal.
' It is not necessary to deal with other pleas raised by defendant o.2 in his written statement which are vague. However, it may be mentioned that the following issues in this suit were framed by consent the parties which reflect the disputes on which they went to trial.
' The issues framed by the Court with the consent of the Advocates 3-9-1973 are reproduced below:--
(1) Whether defendant No,1 had utilized in full the cash credit facility limit of Rs,3,00,000, granted to him by the plaintiff, if so, its effect?
(2) Whether plaintiff had granted to defendant No,1, any facility as stated in para. (4) of the plaint, if so, its effect?
(3) Whether the plaintiff was authorised to transfer, to the Cash Credit Account of defendant No,1, the sum of Rs, 16,694.97, if so, its effect?"
(4) Whether defendant No,1 had executed the documents mentioned in para. (5) of the plaint, involuntarily, and whether they were obtained by the plaintiff by undue influence, if so, its effect?
(5) Whether defendant No,2 had executed the guarantee as alleged in para. (7) of the plaint, if so, its effect?
(6) Whether the guarantee given by defendant No,2 has been discharged, if so, its effect?
(7) Whether the quality of paper,, pledged by defendant No,1 with plaintiff, was inferior than the declared quality, if so, its effect?
(8) Whether the defendants, or any of them, acknowledged their liability to pay to the plaintiff, if so, its effect?
(9) Whether the pledged stocks were, from time to time, inspected by the persons deputed by the plaintiff, if so, its effect?
(10) Whether the plaintiff had refused to deliver to defendant No,1 the pledged paper, as stated in additional pleas of his written statement, if so, its effect?
(1,1) Whether the pledged paper was replaced by the staff of the plaintiff, if so, its effect?
(12) Whether due to the negligence of the plaintiff the value of the pledged paper and/or its quality has been impaired, if so, its effect?
(13) What amount, if any, the defendants, or any of them, are liable to pay to the plaintiff?
(14) What should the decree be?"
' The defendant No,1, opened the case by leading his evidence in the first instance. The sole proprietor, Mr. Sarfaraz Khan examined himself as the defence witness (D.W. No,1 Exh. 6).
' On behalf of the plaintiff bank was examined Mr. Agha Rafiq Ahmed (P.W. No, 1 Exh. 7), the surveyor who carried out survey of the stocks of pledged goods (paper). The other witnesses of the plaintiff were (i) its Assistant Vice-President, Mr. Muhammad Mazaharul Haq (P.W.2 Exh. 8), and (ii) Mr. S. Ziauddin (Exh. 9). (Note: He by a clerical mistake has also been shown as P.W.2).
' The defendant No,2, who is sued as the guarantor by the bank, though filed his written statement but has chosen to remain absent and led no evidence.
6. After hearing the learned Advocates for the plaintiff and the defendant No,1 and going through the record, findings reached by me on the issues with reasons recorded as follows, giving credit for Rs,45,251 received in Court on 18-4-1972 as proceeds of sale of the pledged stock the suit is decreed for Rs,3,82,480.34 with costs and interest.
8. Regarding Issue No,1: The plaintiff bank examined Mr. S. Ziauddin (Exh.9) who produced the duly certified statement of account Exh. 9/1 which shows that the defendant No,1 utilized Cash Credit Facility/ Limit in full by withdrawing various amounts from its account maintained with the plaintiff bank. In the cross-examination of the said witness no question was put challenging any of the entries made in the said account.
' The only question put to the said witness by the learned counsel for the defendant No,1 was in respect of the entry made on 16th June, 1982 transferring in this account Rs, 16,694.97 from another account of the defendant No,l. The legality of the said transfer entry is subject-matter of issue No,3 and has been dealt with there. The fact that this amount (Rs, 16,694.97) was due by the defendant No,1 to the plaintiff-bank has not been disputed.
The learned counsel for the defendant No,1 did not question the correctness of the statement of account (Exh. 9/1). In fact it is conceded by the defendant No,1 himself that the facilities granted by the plaintiff were utilized in full by him.
' Issue No,1 is answered in the affirmative.
8. Regarding Issue No,2: The learned Advocate for the plaintiff referred to the documents which were produced and duly proved marked as Exhs. 6/15, 6/16 and 6/17 submitted that the defendant No,1 was granted besides Cash Credit Facility of Rs, 75,000 which subsequently was enhanced on 2nd May, 1982 to Rs,1,50,000, on or about 5th June, 1982 to Rs,2,25,000 and thereafter on 17th August, 1965 to Rs,3 lacs pointed out that yet another credit facility in the sum of Rs,20,000 was granted to him earlier on or about 20th August, 1956.
' Exh.,6/15 is the letter of defendant No,1 written on 6th October, 1959 addressed to the Chief Accountant of the plaintiff bank wherein the defendant No,1 after stating that Cash Credit Facility of Rs,20,000 granted to him by the plaintiff-bank was due to expire on 31st October, 1959 made a request that in view of the Commercial difficulties faced by him, the said Cash Credit Facility be extended for a further period of one year from October, 1959 and afford him a chance of gratefulness. By letter, dated 12th December, 1959 (Exh. 6/16) the defendant No,1 further requested the Chief Manager of the plaintiff that due to blockade of his big amounts with his customers he could not make recoveries and requested that the facility of Rs, 20,000 may further be extended. A similar request by the defendant No,1 was also made by his letter dated 30th December, 1959 (Exh.
6/17). These letters are admitted by the defendant No,1.
' It would be worth mentioning here that neither the defendant No,1 in his evidence nor his learned counsel at the time of arguments challenged these documents or the statements made therein.
' Accordingly the issue is answered in the affirmative.
8. Regarding Issue No,3: The Cash Credit Facility was granted to the defendant No,2 for Rs, 20,000 on or about 20th August, 1958 out of which a sum of Bs. 16,694.97 was outstanding against the defendant No,1 as on 18th June, 1962. The balance thus due against this 'facility' was transferred in the other account which the defendant No,1 was maintaining with the plaintiff-bank on 18th June, 1962, entry to that effect appears in the certified copy of statement of account Exh. 9/1 at page 16.
The fact that this amount was due by the defendant No,1 to the plaintiff has not been disputed. It was, however, contended that the transfer of the entry from a different account under which granted was Rs, 20,000, in another the account of the defendant No,1 in which cash credit facility of a different amount had been granted, was illegal and unauthorised.
I am conscious of the statement made by the plaintiffs witness Mr. S. Ziauddin Exh.9 that the plaintiff-bank never makes any transfer entry without authority in writing of the account-holder.
The non-production of such a written authority from the defendant No,1, however, cannot successfully be urged as a ground in the present case so as to absolve the defendant No,1 of his obligation to pay Ra. 16,694.97 due by him on 18-6-1962 which amount/entry was transferred in the defendant No,1's own other account with the plaintiff-bank. I am of the opinion that even in the absence of any written authority from the defendant No,1 the plaintiff-bank was competent to transfer the outstanding amount against the defendant No,1 from another account to the main account of the defendant No,l.
' If any authority is needed for the view taken by me as above reference may be made to the case of Messrs Continental Syndicate Trade v. Lloyds Bank Limited PLD 1966 Kar. 556 wherein the learned Divison Bench held:-- "It is now well-recognized that the banker, unless precluded by agreement, is entitled to combine different accounts of a customer."
' The learned Court in the said case also referred to the case of Grania v. M'Kewan (1873) 8 Ex Ch. 10) wherein it was held that unless precluded by agreement the banker is entitled at any time to combine different accounts kept by the customer in his own right, whether deposit or current and to exercise his lien or set off for the resulting balance.
' It is neither the case of the defendant No,1 that there was any agreement to the contrary nor the learned counsel for the defendant No,1 was able to point out anything even to suggest that the plaintiff-bank was precluded from transferring the amount of Rs, 16,694.97 outstanding against the defendant No,1 to the main account of defendant No,1.
' For the abovementioned reasons Issue No,3 is answered in the affirmative and it is held that the plaintiff-bank was entitled to transfer to the account of defendant No,1 the sum of Rs, 16,694.97 which was outstanding against him in another account. It may be observed that the defendant No,1 was unable to show that any prejudice has been caused by the transfer of the disputed entry.
11. Regarding Issue No,4: This issue was not pressed by the defendant No,l. Accordingly, the same is answered in the negative.
12. Regarding Issue No,1: The defendant No,2 guaranteed repayment of the amount of loan under the facility granted to the defendant No,1 as per deed of guarantee, dated 25th August, 1965 Exh.
6/50. The defendant No,1 when confronted with the said document admitted that it bears the signature of his younger brother the defendant No,2.
' In para. 7 of the plaint it has been expressly pleaded that the defendant No,2 in acknowledgment of his liability to pay the plaintiff's dues as a guarantor executed the deed of guarantee, dated 25th August, 1965 thereby agreeing to pay the plaintiff's dues, which might be found due and payable from the defendant No,1 to the plaintiff. The defendant No,2 though filed his written-statement but has chosen to remain absent and has not been cared to lead evidence challenging the statement made in the plaint or the evidence. The deed of guarantee Exh. 6/60 executed by the defendant No,2 produced by the plaintiff and admitted by the defendant No,1, thus stands duly proved.
In view of the above facts, the Issue No,5 is answered in the affirmative. The defendant No, 2 is accordingly held to be liable as guarantor to repay the amount due by the defendant No,1 to the plaintiffs in accordance with and on the terms and conditions mentioned in the deed of guarantee, dated 25th August, 1965 (Exh. 6/50).
13. Regarding Issue No,6: The deed of guarantee executed on 25th August, 1965 (Exh. 6/50) expressly provides that it is a continuing guarantee and that the plaintiff-bank shall be at liberty to take steps to enforce payment of the promissory note at any time after notice, demanding payment of the amount due from the principle debtor, posted to the guarantor at his usual or last, known address and that any default made in payment for three days after the posting of such notice, shall entitle the plaintiff to recover the amount due and enforce the guarantee against the guarantor. It also provides that no default of the bank in requiring or enforcing the observance or performance of any of the stipulations or terms or the granting of any time or the renewing of any agreement, shall have the effect of releasing the guarantor from his liability or of prejudicing the Bank's rights or remedies against him. The defendant No,2 as noticed above has chosen to remain absent though served with the summons and there is nothing on the record to justify his plea that the said defendant No,2, the guarantor, was discharged. The plea taken by him in para. 2 of his written statement whereby he denied that he is the guarantor of the defendant No,I is falsified by the deed of guarantee Exh. 5/60. Further the plea that the alleged guarantee if any stood discharged, without any mentioning any fact justifying such a plea, and in the absence of any evidence the plea raised cannot be accepted.
' Mr. Rehmani, the learned counsel for the defendant No,1 was unable to advance any argument in support of the plea that the defendant No, 2 in any manner has been discharged from the guarantee furnished by him. The learned counsel faced with this situation, submitted that this issue does not concern the defendant No,1 for whom he appears.
' Accordingly the issue No,5 is answered in the negative.
14. Regarding Issue No,7: It is admitted by both the parties that the defendant No,1 as security for repayment of any amount due by him pledged with the plaintiff his stock of papers which was stored by the defendant No,1 in the godown rented by him situated at Lawrence Road, Karachi. It is the case of the plaintiffs that they took possession of the said stock on the basis of the statement of the defendant No,1 regarding the contents and the quality thereof, the defendant No,1 agreeing that in case defects, shortcomings or inaccurracies as to the quality and quantity were found in the stock pledged, he shall be alone responsible for the same.
' It is the case of the plaintiff, as pleaded and supported by the plaintiffs officers Muhammad Mazharul Haq (Exh. 8) and S. Ziauddin (Exh. 9) that subsequently, it was discovered that the quality of the paper which was pledged by the defendant No,1 was not the one which was declared by him but of much inferior quality, and that he had deliberately wrongly declared the quality of the goods as superior. A survey has carried out of the said goods on 1st March, 1968 by Mr. Agha Rafiq Ahmed of Messrs Agha & Company who submitted the report, dated 14th March, 1968. A copy of the said survey report was produced alongwith the plaint as Annexure "H", copy of which was also supplied to the defendants alongwith the plaint. In the said survey report the description, qualities and value of the goods have been given.
' The survey report subsequently produced in evidence and marked as Exh. 6/1, was put to the defendant No,1 in his cross-examination. This report was proved by the plaintiff-bank who examined Mr. Agha Rafiq Ahmed, the surveyor who deposed that he had conducted the survey and prepared the survey report marked Exh. 6/1. The said report showed the valuation of the stock pledged.
' The defendant (Sarfaraz Khan) made a significant statement that the goods on arrival, used to be cleared by his clearing agents and that the same after clearance of used to be stored in godown, he then stated:-- "I cannot say what was the quantity and quality of the paper and board which was for the first time pledged with the plaintiff bank."
' To a further question put to him in cross-examination, it was stated:-- "I have record about the stock of paper and board pledged with the bank from time to time. I also have record of delivery obtained by me from the bank from time to time. I cannot say if I have produced the record referred to above in Court. It is correct that if I would have produced the above: record it would show the quantity as well as quality of goods pledged with the bank."
' Reference may here also be made to the plaintiff's letter, dated 15th June, 1967 Exh. 9/3 which was addressed to the defendant No,1 wherein it was expressly stated that the samples of stocks pledged by him with the plaintiff bank were shown in the market and it was found that he had declared some items of the stock of high quality with higher rates than their actual quality and market prices and that in this respect the defendant No,1 had personally discussed the matter with the Manager of the plaintiff-bank when the defendant No,1 had promised to regularise the account but he had failed to do so. The defendant No,1 was accordingly called upon to adjust the account by depositing Rs, 2,26,732 together with accruing interest within 7 days from the receipt of the said notice failing which he was warned that the stock pledged would be disposed of without further notice and legal proceeding would be instituted against him for the shortfall. The defendant No,1 in his reply, dated 17-6-1967 (Exh. 6/70) however, contended the quality of goods pledged was correct and prices were based on market value at the time of the pledge. He further stated that he would be able to lift the entire stock by making full payment. Correspondence on the subject continued, plaintiff complaining as to the quality and value of pledged goods and demanding repayment with the warning that in case of default the pledged goods would be disposed of and short would be recovered while the defendant No,1 alleged that its quality was correct, that he would clear the entire dues soon within periods mentioned by him and that if action as threatened was taken, he would hold the bank responsible for the losses suffered by him.
In the light of the above discussion, I find that the plaintiff's case that the goods pledged by the defendant No,1 was of inferior quality and of lesser value is supported by the evidence of Mr. Agha Rafiq Ahmed (P.W.1 Exh. 7) who carried out the survey on 1-3-1968 in the godowns of the defendant No,1 situated at Lawrence Road, Karachi. The survey report, dated 14-3-1968 (Exh. 6/1) has been produced by him. The surveyor frankly admitted that he had drawn samples of all items mentioned in the report but had made no enquiries with regard to quality of the paper. The statement of the witness, the surveyor, remained unrebutted.
' As against the above evidence of plaintiffs except the word of the defendant No,1, who obviously is an interested party, I find that neither he cared to produce the record of purchase or import of the said pledged goods nor the other records, which he in his evidence admitted to be with him, in proof of his case that the quality or value of the said goods was otherwise than what the plaintiff's witnesses had stated. The defendant No,1 has suppressed the material record in his possession. It is obvious as also admitted by the defendant No,1, that he produced the record it would have shown the correct quantity, the quality and value of the pledged stock. For the reasons that the defendant No,1 has suppressed material record, the Court is entitled to draw adverse presumption against him.
' For the above reasons, I hold that the paper pledged by the defendant No,1 was inferior in value than what was represented. The Issue No,7 is answered accordingly.
15. Regarding Issue No,8: As to the acknowledgments made by the defendant No,1 of his liability to pay the dues to the plaintiffs the learned counsel for the defendant No,1, was hardly able to contest the, plaintiffs case that he duly made acknowledgments from time to time. I may briefly refer to the acknowledgments made by the defendant No,l. The first in the series is the pronote, dated 25-8- 1965 followed by letter, dated 6-10-1966 of defendant No,1 promising/assuring the plaintiff, that as per his "repayment programme" submitted by him to the plaintiff, he shall make payments, thus regularly decreasing his liabilities.
' Thereafter, the defendant No,1 wrote letter, dated 25-9-1967 (Exh. 6/72) to the plaintiff whereby while promising to repay the dues, he promised:- "We' also assure you that we will definitely clear all our liabilities Within one year if we get your co- operation and assistance."
' Then on 14-11-1968, by his letter (Exh. 6/62) the defendant No,1 in which while requesting the plaintiff to waive the "forced" liabilities (created by what the defendant No,1 mentioned as overcharging of the interest, penal interest and other banking and incidental charges) promised to liquidate the dues.
' The issue No,8 is accordingly answered in the affirmative, holding further that the suit filed on 12-3- 1971, is within time.
16. Regarding Issue No,9: The defendant No,1, who opened the case and led evidence in the first instance, thus taking upon himself the onus, stated in his evidence (Exh. .6) that at the time of delivery of paper stock pledged (paper and board) in his godown where the same was stored, the bank inspector and godown keeper used to inspect the quality of the said goods and that the key and control of this godown was exclusively with the plaintiff-bank, and that the stock at all relevant time was equivalent to 85$ of the investment of the bank. After referring to Annexure 'H' to the plaint (i.e. To the survey report subsequently marked Exh. 6/1), the defendant No,1 stated that, the survey' was made without reference to him. He then made the following significant statement:-- "I cannot say whether the valuation show in Annexure 'H' to the plaint is correct or not as it was done in 1968."
This statement of the defendant No contradict the case of the plaintiff that the was much below the value declared, in any low as shown in the survey report Exh. Thus the plaintiff-bank was fully justified No,1 to regularise the account by taking dues. .1 does not in any manner value of the pledged stock case the value thereof was 6/1, dated 14-3-1968, and to call upon the defendant delivery and clearing the Mr. Izharul Haq (P.W.2 Exh. 8), in his evidence deposed that he was directed to get the stock surveyed, that survey was conducted and found to be inferior of which fact the defendant as well as the controlling authority was advised.
' The plaintiff's abovenamed witness further stated that he had deputed godown inspector to go and inspect the stock, that the said godown inspector took samples and finally the survey was also conducted.
Thus, the conclusion is that the inspection of pledged stock took place, that the value thereof at the time of survey as per survey report, dated 14-3-1968 (Exh. 6/1 a copy of which was filed with the plaint), was lesser than what was shown at the time the said stock was pledged. I may also point out here once again that the defendant No,1 though maintained accounts, suppressed the same and withheld them from production in Court.
' The Issue No,9 is answered accordingly.
17. Regarding Issue No,10: The defendant No, 1, in his deposition in the Court, stated that after 14-3- 1968 he did not obtain delivery of the goods from the bank as it had refused to give delivery of the same. He further stated:-- "According to the agreed procedure we used to obtain delivery of the goods from the bank on payment of 85% of their value plus the expenditure incurred by the bank. However, when they refused to give delivery we even offered them 100$ payment but they only gave us delivery for sometimes and thereafter stopped."
' When cross-examined, he admitted that the last delivery he took from the bank was in the year 1966 but was unable to produce any letter to show that the bank refused to deliver the goods. On the contrary, the correspondence exchanged between the parties, shows that the defendant No,1 from time to time used to make premises to lift the goods gradually but after raising pleas that due to difficulties faced for one reason or the other, he could not adhere to the same. I may only refer to some of the letters written in 1968 by the defendant No,1, in which year according to him, the plaintiff refused to deliver the goods even against payments.
' On 8-5-1968 (Exh. 6/65), the defendant No,1 wrote that since 21-3-1968 he was trying his utmost to dispose of the goods but due to slackness in the market and also due to delay in getting the Delivery Orders though backed by cash payments, he could not reach the target. It is clear from a reading of this letter that the defendant No,1, according his own statement was unable to dispose of the goods and thus failed to take delivery for the reason which he described as slackness in the market but in an attempt to avoid consequences of his own default, tried to put blame partly also on the bank which excuse in my opinion is of no avail.
' On 24-6-1968 (Exh. 6/63) the defendant No,1 wrote to the plaintiff that owing to general slump in the market he had lifted very little quantity and that such conditions would continue till the end of July, 1968.
' On 24-7-1968 (Exh. 6/69) the defendant No,1 again referred to the causes of his failure to lift the pledged goods for the reasons earlier stated.
' As against the above letters, amongst others from defendant No,1 which need not be referred as the same do not say anything which could advance his case, I may now refer to some of the letters of the plaintiff-bank.
' On 29-6-1967 (Exh. 9/2), after drawing attention of the defendant No,1 to the state of account, the plaintiff wrote to him:- "With reference to your letter, dated 17-6-1967 we have to advise that the sample of your stocks pledged to the bank were shown in the market and it was found that you have declared some items of stocks of high quality with higher rates than their actual quality and market prices. In this respect you personally discussed the matter with us and had promised to regularise the account but you have failed to do so.
' Under the circumstances you are once again called upon to adjust your account by depositing Rs, 2,26,732 together with accruing interest within seven days from the receipt of this notice, failing which we shall dispose of the stocks pledged with us, without further notice and legal proceedings will be instituted against you for the shortfall."
' Thereafter as there was no improvement, the plaintiff on 18-7-1968, (Exh. 9/4) gave notice to the defendant No,1 as follows:- "You gave us an assurance to lift the entire stocks pledged to us within six months. We regret to point out that there are no indications that you will take delivery of the stocks within the stipulated period as the quantity of stocks delivered according to our D.Os. Is very small. You are fully aware that the bank has shown much indulgence to you and the adjustment of the outstandings in your Cash Credit Account are long overdue.
' You are hereby called upon to kindly adjust the entire outstandings amounting to Rs,3,00,077/34 excluding interest for the current month within a week's time from the date of the receipt of this letter failing which we shall dispose of the entire stocks without further reference to you and legal proceedings shall be instituted against you for any deficient amount.
' Please treat it as FINAL NOTICE."
' As the defendant No,1 still continued to be defaulter the suit was filed in which with the permission of the Court, the Nazir disposed of the stocks.
It is obvious that at no time the defendant No,1 offered to pay and/or tendered the amount due from him to the plaintiff to claim release of the pledged stock. The plaintiff in law was not bound to accept part payments and release pledged stock in instalments. Concessions granted at times could not oblige the bank to give up its right to claim full payment though it can be safely be said that even these concessions, the defendant No,1 could not avail of for no valid reason.
' The Issue No,10 is thus answered in the negative.
18. Regarding Issue No,18: In support of this issue the learned Advocate for the defendant No,1 could only refer to the bare statement made by his client in his evidence as follows:- "In so far I understand the reason for refusal on the part of the bank to give us delivery was that they shifted the pledged goods from our godown at Nishtar Road to their own godown at West Wharf without any intimation to us and while shifting the stock of goods from Nishtar Road godown to West Wharf near Customs House, the bank people substituted the stock of inferior quality of goods in place of pledged goods."
' The defendant No,1, however, during his cross-examination on the statement made as above, to a question put to him replied:- "So far as I recollect the stock of papers were shifted from Nishtar Road godown to West Wharf godown by the plaintiff-bank without intimating us. I was in correspondence with the bank and say that I must have maintained the same. I had made numerous written complaints to the bank about non-delivery of the goods. I filed the copies of those complaints in the Court. (The witness is unable to produce any such letter addressed to the bank)."
' The allegation levelled by the defendant No,1 was of a serious nature and it was his duty to have proved the same with positive and convincing evidence. Not only he could not do so, but in my opinion he even failed to establish quality of paper/board he had pledged with the plaintiff. In this respect I may refer to the evidence discussed under Issue No,7 from which it would be seen that the defendant No,1 had suppressed the record/accounts which he admitted to have maintained and which if produced would have disclosed the quality of paper/board imported and pledged with the bank. Due to the non-production of the said record/accounts the Court is justified to conclude that there is no truth in the statement made by the defendant No,1 involving bank employees in acts of criminal nature.
' The plaintiff denied the reckless allegation made by the defendant No,1 with the plaint a copy of the Survey report Exh. 6/1 was produced, but the defendant No,1 did not even specify in what respect the same was wrong. The Issue No,11 in the light of the above discussion is answered in the negative.
19. Regarding Issue No,12: As to this issue both the learned counsel conceded that there was no evidence on the record to show that there was any negligence on the part of the plaintiff due to which the value of the pledged paper and/or its quality as alleged was impaired. The issue is accordingly answered in the negative.
20. Regarding Issue No,13 and 14: The plaintiff has produced statement of account duly certified marked as Exh. 9/1 in which no mistake or incorrectness could be pointed out by the defendant No,1, who admittedly received copy of the same with the summons. According to the said statement of account as on the date of filing of the suit the defendant No,1 was liable to pay Rs, 387,762.74 for the recovery of which the suit was filed. During the pendency of the suit with the permission of the Court the Nazir sold the pledged stock which fetched Rs, 45,251 which amount was deposited in Court on 18-4-1972.
The defendant No,1 as the principal and the defendant. No,2 as the guarantor therefore are liable to pay Rs,3,82,480.34 as detailed below:-- Suit Amount. Rs.3,87,762.74 Interest on Suit Amount from 13-3-1971 to 17-4-1972 @ 9% with quarterly rests.Rs.39,968.60 Rs.4, 27, 731.34 Less amountdeposited on18-4-1972 in the High Court by Sale of paper. Rs. 45, 251.00 Total: Rs.3,82,480.34 ' The suit is accordingly decreed against the defendants jointly and severally for Rs, 3,82,480.34 with interest at the rate of 9% per annum with quarterly rests from 18-4-1972 till payment. The defendants shall also pay costs of the suit to the plaintiff.