' RUSTAM S. SIDHWA, J.---This is an appeal filed by the Central Bank of India Limited, Lahore, appellant (Enemy Concern) through Assistant Custodian, Enemy Property (Banks), Lahore, appellant, against the judgment of the learned Single Judge of the Lahore High Court dated 7-4- 1975 dismissing its appeal.
' The brief facts of the case are that the appellant bank instituted a suit,. Through its Attorney Mr. S.K.
Shikari, for the recovery of Rs,39,329.9 against the firm M/s. Taj-ud Din Abdur Rauf, Sialkot, and its partners, respondents. In the written statement the respondents took up the' plea that the suit had been instituted without proper and valid authorisation from the appellant bank and that Mr. S.K.
Shikari who was alleged to hold the power of attorney on behalf of the appellant Bank was not competent to institute the suit or present the plaint, unless he was specially authorised by the appellant bank to do so.
3. The trial Judge by his judgment dated 11-7-1962 held that though the appellant Bank had produced a photo copy of the power of attorney executed by the directors of the appellant bank in favour of Mr. S.K. Shikari on 2-9-1948, which copy had been admitted by the respondents and had been marked as Exh.P.1, a copy of the resolution passed by the Board of Directors proving the grant of such power of attorney had neither been admitted by the respondents nor been exhibited in Court and, in the absence of formal proof of such resolution, issue No,1 remained unproved. As regards issue No,2 the trial Judge held that Mr. S.K. Shikari had at one stage stated that the suit had been filed by him on receiving instructions from the appellant Banks's Central Office in Bombay, but he made another statement on the same day that he was not in a position to state as to whether the said instructions were supported under any provision of the Articles of Association of the Bank and had again on 12-3-1951 stated that the directors of the appellant Bank were authorised to institute the suit on behalf of the appellant Bank under Article 116(7) of the Articles of Association of the Bank and since the Bank had neither produced the alleged letter from the Central Office at Bombay to the Lahore Branch containing instructions to institute the present suit, nor the Articles of Association had been produced by the appellant Bank or duly proved, issue No,2 did not stand proved. In view of its decision on issues Nos.1 and 2, the trial Court found issues Nos.3 and 4 in respondent's favour. The trial Court therefore dismissed the suit of the appellant Bank.
4. Being aggrieved by the above judgment, the appellant Bank preferred an appeal before the High Court, which was also dismissed by the learned Single Judge on the ground that in the absence of any proof of the resolution passed by the appellant Bank proving the grant of the power of attorney to Mr. S.K. Shikari, the said attorney was not competent to institute the suit. The appeal was therefore dismissed.
5. Leave was granted in this case to consider whether the suit instituted in this case by Mr. S.K.
Shikari, the alleged attorney, was competently instituted and whether power of attorney in his favour on the facts and the circumstances of the case, as brought on the record, was legally sufficient to authorise him to do so, in the light of the principle laid down in Messrs Muhammad Siddiq Muhammad Umar and another v. The Australasia Bank Ltd. PLD 1966 SC 684.
6. Before dealing with the legal issue, it is necessary to reproduce certain portions of the proceedings of the trial Judge. On 20-2-1951 the statement of Mr. S.K. Shikari on SA. Was recorded by the trial Judge to the following effect:-- "No resolution was passed by Lahore Office of our bank or the Central Office Bombay to the effect that the present suit be filed in Court. From our Head Office at Bombay a letter was received in our Lahore Branch instructing us to file the suit and that was how the suit was filed. Before the general power of attorney was granted in my favour the Board of Directors of our Bank at Bombay passed a resolution to the effect that such a power should be granted."
' The Civil Judge then framed the following two preliminary issues:-- "(1) Was the 'granting of power of attorney in favour of Mr. S.K. Shikari authorised by the Board of Directors by resolution, if so when?
(2) Has the present suit been filed under instructions from the Head Office at Bombay and what is the legal effect of those instructions in the absence of a resolution of the Board of Directors on this matter?"
' The learned Civil Judge then recorded another supplementary statement of Mr. S.K. Shikari on the same day to the following effect:-- "I cannot presently say whether in support of the written instructions, from the Head Office at Bombay regarding the filing of this suit, there was any power vested in the Bombay Board of Directors under the Articles of Association of the Bank vesting powers in the Director to authorise the filing of the suit. I should be given time to make an inquiry in this connection."
' On 12-3-1951 the Civil Judge recorded further statement of Mr. S.K. Shikari on SA. As follows:-- "Under Article 116(7) of the Articles of Association of the plaintiff-Bank the Directors had given the powers to institute legal proceedings on behalf of the Bank. I am producing herewith a true copy of the said sub-clause of the Articles."
' On 16-4-1951 the statement of Mr. S.K. Shikari Attorney as P.W.1 on SA. Was recorded in the following terms:- "I am an attorney of the plaintiff-Bank. The Head Office of the plaintiff-Bank is at Bombay. 1 have brought with, me and produce the Memorandum and Articles of Association of the plaintiff bank and a copy of the resolution of the plaintiff-Bank dated 2nd September 1948."
' The counsel for the plaintiff then requested for an adjournment with a view to prove letters from the Chief Agent of the plaintiff-Bank to the Agent at Bombay. On 4-6-1951 the appellant Bank applied for issue of interrogatories to' Mr.. S.H. Bhall4, Director of the Bank at Bombay, for proving the resolution for the grant of power of attorney to Mr. S.K. Shikari, and also made a request to summon Mr. S.R. Jariwala, Agent of the appellant-Bank at Lahore. The same was rejected on 18-6-1951 on the basis that the interrogatories were not filed in triplicate and that they were not signed by any body and the request to summon Mr. S.R.Jariwala was made late and would delay the case. Since no oral or documentary evidence had been produced, the Civil Judge therefore closed the case of the plaintiffs on the preliminary issue. The Civil Judge then held:-- "I, therefore, straightaway proceed to dispose of the preliminary issues after hearing the learned counsel for the parties.
' Article 116, paras 7 and 11 of the Articles of Association of the plaintiff-Bank, give powers to the directors to institute legal proceedings by the company and for affairs outside Bombay to sub- delegate any of the above powers. There is a copy of the general power of attorney given by the Directors of the Bank and the Manager under the common seal of the Bank to Mr. Shikari and part 6 of his power of attorney authorised. Mr. Shikari to commence, prosecute and enforce any suit or any other legal proceedings. Prima facie therefore Mr. Shikari has the powers to institute this suit and there does not appear to be any legal flaw on the point."
' The Civil Judge then questioned the learned counsel for the respondent as to whether he had requested his predecessor Civil Judge to frame any issue on the point and whether resolution of the Board of Directors was necessary to appoint a general attorney or to file a suit against the party, to which the learned counsel for the respondent replied that no such issue was necessary.
However, the learned Civil Judge held:-- "Without these issues I do not think that the real points existing in the mind of Mr. Nazir Ahmad Bajwa, Advocate can be said to have been brought to light on the judicial record. For his satisfaction therefore, I frame the following other issues alongwith the issues on merits."
' He then framed fourteen further issues, including the two below which dealt with the competency of Mr. S.K. Shikari to institute the case:-- "(3) Was any formal resolution of the Directors of the Bank or any other body of the Bank necessary to appoint a general attorney of the Bank? OP on defendant.
(4) Was any formal resolution of the Directors of the Bank, or any other body necessary to authorise Mr. Shikari to institute this suit in spite of the powers contained in the Articles of Association and the general power of attorney in favour of Mr. Shikari? OP on defendant."
' The proceedings then continued for a number of years. Eight further issues were framed on 10-3- 1952 and the file of the suit sent to the Deputy Custodian of Evacuee Property, who conducted proceedings on the suit file and recorded evidence on the suit file. The suit file ultimately went to the Custodian of Evacuee Property, who held that the defendants were bound to pay their debt to the Bank and he authorised the Bank to continue the suit and to pay the decretal amount, when realised, into his account with the State Bank of Pakistan. At this stage, it may be stated that the appellant Bank's Memorandum and Articles of Association was exhibited as Exh.A/1 on the suit filed by the Deputy Custodian of Evacuee Property on 29-7-1952. The original certificate of filing of the Memorandum and Articles of Association with the office of the Assistant Registrar of Joint Stock Companies, West Punjab, was also exhibited as ExhA/2. The suit then continued before the Civil Judge, which was ultimately dismissed on 11-7-1962. The learned Civil Judge held that preliminary issues Nos.1 and 2 had originally not been disposed of, and as his predecessor had come to the conclusion that without additional issues it was not possible to determine the real points raised by the defence counsel, he had accordingly framed issues Nos.3 to 16. The Civil Judge thereupon decided issues Nos.1 to 4 against the plaintiff.
7. On behalf of the appellant Bank it is submitted that the learned Civil Judge having himself decided preliminary issues Nos.1 and 2 in favour of the appellant Bank, he was not obliged to frame preliminary issues Nos.3 and 4 on 18-6-1951, specially when learned counsel for the respondent also did not desire the same, but the learned Civil Judge, to defeat the appellant Bank's case, framed the two further issues for the satisfaction of the counsel for the respondent on the feigned belief that the real points in the mind of the respondent's counsel could not be said to have been brought to light in the judicial record. It is further submitted that preliminary issues Nos.1 and 2 having been decided on 18-6-1951, the learned Civil Judge was debarred from deciding the same afresh on 11-7- 1962, which he did. It is next contended that true copy of Article 116(7) of the Articles of Association having been produced before and taken on the record by the learned Civil Judge on 12-3-1951; through statement of Mr. S.K. Shikari recorded on solemn affirmation, in the presence of and without any objections from the counsel for the respondent and a copy of the Memorandum and Articles of Association of the appellant-Bank and a copy of the resolution of the appellant-Bank dated 2-9-1948 having been produced before and taken on the record by the learned Civil Judge on 16-4-1951, through statement of Mr. S.K. Shikari P.W.1 recorded on solemn affirmation, in the presence of and without any objections from the counsel for the respondent, the fact that the learned Civil Judge forgot to exhibit the said documents, could not be treated later by the successor Civil Judge as fatal to the appellant Bank's case and the said true copy of Article 116(7), the copy of the full Memorandum and Articles of Association of the appellant-Bank and the true copy of the resolution of the appellant-Bank dated 2-9-1948 should all be treated as duly exhibited and proved documents, against which no objections as to their admissibility or mode of proof had been taken, and the case of the appellant-Bank on preliminary issues Nos.1 to 4 should be treated as proved in its favour. It is further contended that when the power of attorney and the supportive articles from the Articles of Association under which the power of attorney is granted are proved, it is not necessary to prove the resolution by which the directors may have resolved to grant such a power of attorney to the attorney. In this connection Muhammad Siddiq Muhammad Umar v. The Australasia Bank Ltd. PLD 1966 SC 684 at 695 and Habib Bank Ltd. v. Green Garments Manufacturers PLD 1978 Kar. 1027 are referred.
8. Nobody has appeared on behalf of respondents Nos.1 to 3. They are therefore proceeded ex parte.
9. With the assistance of the learned counsel for the appellant we have gone through the record. It is obvious from a perusal of the record that the learned Civil Judge himself on 20-2-1951 framed two preliminary issues and then on 12-3-1951 took on record a true copy of Article 116(7) of the Articles of Association of the appellant-Bank, through statement of Mr. S.K. Shikari recorded on solemn affirmation, and on 16-6-1951 took on record a copy of the full Memorandum and Articles of Association of the appellant-Bank and a true copy of the resolution of the appellant-Bank dated 2- 9-1948, through statement of Mr. S.K. Shikari recorded as witness P.W.1 on solemn affirmation, on both' of which occasions counsel for the respondent was present and no objections as to admissibility or mode of proof of the said documents were taken by him. Though copy of Article 116(7) of the Articles of Association and copy of the resolution of the appellant-Bank dated 2-9- 1984 appear on the record, the copy of the full Memorandum and Articles of Association now does not appear on the record. There is no endorsement of the learned Civil Judge on the reverse of the two documents which are on the record as to their admission in evidence, as required by Order XIII, Rule 4, or their rejection as inadmissible in evidence, under Order XIII Rule 6, C.P.C. Strangely, the copy of the Memorandum and Articles of Association which was admitted in evidence and exhibited as Exh.A/1 on the suit file by the Deputy Custodian of Evacuee Property also now does not appear on the suit file. And to crown it all, Mr. Shikari's power of attorney marked Exh.P.1, which is referred by the learned Civil Judge in his final judgment as a document admitted by the respondent's counsel, also now does not appear on the record. However, the fact remains that the learned Civil Judge on 18-6-1951 decided preliminary issues Nos.1 and 2 in favour of the appellant- Bank in no unmistakable terms, as is apparent from the extract of his order reproduced above. This order clearly shows that the learned Civil Judge held that the power of attorney stood properly proved and that Mr. S.K. Shikari had the power inter alia to institute the suit and there did not appear to be any legal flaw on this point. This finding he would not have given, if he had treated the three documents that had by then been filed before him as unproved. Very likely he took these documents as proved, though he forgot to exhibit them, for which lapse he did not penalise the Bank. But assuming we do not subscribe to this position, the fact remains that the power of attorney marked Exh.P.1 was a document admitted by the respondent's counsel. The text of this document appears at pages 76-80 of our paper book. The full copy of the Memorandum and Articles of Association was admitted on the record of the suit and exhibited as Exh.A/1 by the Deputy Custodian of Evacuee Property. This document is no longer on the record, but true copies of Articles 116(7) and 116(11), duly certified by the appellant-Bank, appear on the record. These we can read as a good substitute for the Memorandum and Articles of Association Exh.A/1 which is lost.
Reading these documents together, it appears that the directors of the appellant-Bank had power to delegate their powers of instituting suits to third persons and they did so delegate their powers to Mr. S.K. Shikari, by the power of attorney Exh.P.1. The view of the learned successor Civil Judge that preliminary issues Nos.1 and 2 had not earlier been decided in favour of the appellant-Bank and he therefore proceeded to decide them again on 11-7-1962, is based on a grave misreading of the evidence and his conduct is startling in the extreme. The learned Judge of the High Court failed to notice this grave mistake.
10. This therefore leaves the question of issues Nos.3 and 4. As held by this Court in the Australasia Bank's case (supra), once it is proved that the power of attorney has been executed and the relevant articles under which the Directors can delegate their respective powers to institute and prosecute suits on their behalf have been proved, it is not necessary to prove the resolution by which the directors have resolved to grant such a power of attorney to the attorney. We would, therefore, hold that issues Nos.3 and 4 are redundant, if, issue No,1 stands proved, and since issue No,1 has been proved, nothing turns on issues Nos.3 and 4 to displace the appellant-Bank's case.
The view of the learned Civil Judge and of the learned Single Judge of the Lahore High Court that it was necessary to prove the resolution, being contrary to the law declared by this Court in the Australasia Bank's case (supra), deserves to be set aside.
11. For the foregoing reasons, this appeal is accepted and the judgment and decree of the learned Single Judge of the Lahore High Court dated 7-4-1975 is set aside and the suit is remanded to the competent Civil Court for disposal of the case on the remaining issues on the merits.