1. ' This is a defendant's revision petition directed against the judgment and decree, dated 22-12-1987 passed by the Judge Small Causes Court, Karachi whereby he decreed the suit filed by the respondent.
2. ' The facts leading to the filing of the above revision petition are that the respondent is a practising Advocate and in the month of January, 1985 he received a Bank Draft bearing No, 0163846, dated 17-1-1985 issued by Riyadh Bank, Harf-al-Batin, Saudi Arabia for Rs,1,000 from his client Muhammad Iqbal towards his professional fee. The respondent averred in the plaint that unfortunately the Bank Draft, on receipt, was misplaced somewhere in case files of the respondent and could not be located/found earlier than May, 1986. It is further averred that after finding it the respondent deposited the aforesaid Draft with his bankers viz. U.B.L. Compbell Street Branch, Karachi for collection and payment to him. It is the case of the respondent that on presentation to the petitioner, the same was refused to be paid on the ground that the same is out-dated. The respondent served legal notice, dated 12-8-1986. As the, petitioner did not pay the amount, the respondent filed suit No,74 of 1987 against the petitioner.
3. ' The petitioner filed written statement. The petitioner pleaded in the written statement that the petitioner refused the payment because the draft had become outdated and stale. The petitioner pleaded in the written statement that the Draft was of dated 17-1-1985 and it was presented for encashment after over one year. The petitioner submitted in the written statement that according to established banking practice and procedure the validity of the draft is for six months, and it should be presented within the said validity period. On the pleadings of the parties the trial Court framed the following issues:---
(1) Whether the plaintiff is entitled to recover Rs,1,000 from the defendants?
(2) What should the decree be?
4. ' The learned Judge, Small Causes Court on appreciation of the evidence on record and taking into consideration the arguments advanced by the learned counsel for the parties, decreed the suit vide judgment and decree, dated 22-12-1987.
5. ' The petitioner being aggrieved by the judgment and decree has filed the present revision petition.
6. ' Mr. Hamid Hussain, the learned counsel for the petitioner contended that the negotiable instrument ought to have been presented to the petitioner within a reasonable time after it is received by the holder. The learned counsel contended that the said presentation was made contrary to the practice of all the Banks in Pakistan that the negotiable instruments loose their validity if they are not presented within six months from the date of issue.
7. ' I have heard the learned counsel for the parties and perused the R&P of the case. I have also gone through the impugned judgment.
8. ' It is not in dispute that Bank Draft No,0168466 for Rs, 1,000 was issued on 17-1-1985 by Riyadh Bank.
9. It is an admitted position that the same was presented for encashment after over one year. The petitioner returned the draft with endorsement on Memo. "The cheque is outdated". The respondent served a legal notice, dated 12-5-1986. The petitioner sent a reply dated 3-9-1986 stating therein that the draft had become outdated and stale. The petitioner advised the respondent to approach the purchaser of the draft for revalidation of the said draft whereafter the same may be presented for payment within the period of six months.
10. ' The petitioner bank pleaded practice in its written statement. The Bank Officer appeared in the Witness Box and stated that it is their practice that the negotiable instruments loose their validity if they are not presented within six months from the date of issue. It appeared from the evidence of the Bank Officer of the petitioner that the Bank Draft was presented after a lapse of seventeen months and in Pakistan there is a practice that negotiable instruments should be presented within a reasonable time. Subsection (2) of section 84 of Negotiable Instruments Act provides that in determining what is reasonable time, regard shall be had to the nature of the instrument, the usage of trade and of bankers, and the facts of the particulars case.
11. ' In Sheldon's Practice and Law of Banking (10th Edition) at page 7, the learned author stated that "it is necessary to distinguish between cheques termed 'out of date' in Law for purposes of negotiation and those termed' out of date' by banker's custom. As regards the Latter, most bankers return cheques presented six or more months after date, marked "out of date", and require the drawer's confirmation before payment."
12. ' In Banking Law and Practice in India by M.L. Tannan (Fourteen Ed.) at P.131, the learned author stated that "unless a cheque is presented within reasonable time after the ostensible date of its issue, it should not be honoured.
13. Generally speaking, a cheque presented more than six months after the ostensible date of its issue, is considered a stale one. Some banks in England honour cheques even if they are presented within twelve months, but, both in England and in India a period of six months is allowed for presentation of cheques according to the practice of bankers.
14. ' A cheque or negotiable instrument is over due, or, as it is called, "stale" when it appears on the face of it to have been in circulation for an unreasonable length of time.
15. ' In Griffiths v. Dalton (1940-2-KB 264), the facts of the case are that the cheque was given to the plaintiff in August, 1931, and that time bore no date. Nothing was done with it until February, 1933, when the plaintiff filled in the date on the cheque February 20, 1933. He then presented the cheque for payment at a Brighton Branch of the Midland Bank, but it was dishonoured and he filed the suit.
16. It was held as follows:- "Although the cheque in the present case bore no date, the plaintiff, by S.20 of the Bill of Exchange Act, 1882, following what, I think, was the common law before the passing of that Act, had a prima facie authority to fill in the date, but by the common law he was bound to do so within a reasonable time. The question what is a reasonable time is a question of fact, and on the facts of this case I am satisfied that the reasonable time had long since elapsed. There was, therefore, no authority to fill in the date as it appeared on the cheque and no liability on the bank to meet it. The claim on the cheque fails."
17. Following the principles laid down in the above case, I am of the opinion that admittedly the Bank Draft was presented after seventeen months, the same had become out of date or stale and the petitioner had refused to pay the amount of Rs,1,000. The claim on the Bank Draft fails.
18. ' In the result, the revision petition succeeds, the judgment and decree dated 23-12-1988 passed by the learned Judge, Small Causes Court, Karachi are set aside. The suit stands dismissed. In the circumstances of the case of parties are directed to bear their own costs.
19. ' The above are the reasons for the short order, dated 28-5-1989, allowing the revision petition on the conclusion of the arguments.
20. Petition succeeded.