1. This is a suit under Order XXXIV, C. P. C. And in the alternative under Order VII, rule 2, C. P. C. For the recovery of Rs. 1,15,413.66 with interest and costs of the suit.
2. The facts, as disclosed in the plaint, are that the plaintiff is a banking Company incorporated under the Companies Act, 1913 and the ownership, management and control of the plaintiff vests in the Federal Government under the Banks (Nationalisation) Act, 1974 (Act XI of 1974). It has further been stated that the defendant No. 1 is a partnership firm registered under the Partnership Act and that defendants 2 and 3 are or were at all the material times the partners of the defendant No. 1. It is has also been averred that defendant No. 2 mortgaged by way of equitable mortgage his property in favour of the plaintiff as security. It has further been averred that defendants 2 and 3 executed and delivered to the plaintiff letter dated 7-3-74 to the effect that the said defendants are the partners of defendant No. 1 and are jointly and severally liable to the plaintiff for the liabilities of defendant No. 1. It has also been asserted that defendant No. l maintains a current, mutual and open account (Account No. 6195) with the plaintiff at its Cloth Market Branch. It has also been stated that the defendant No. 1 had overdraft facility in the said account against the security of hypothecation of goods and export licence. It has further been averred that on 7-3-74, the plaintiff with the consent of the defendants limited the overdraft facility in the sum of Rs. 85,000. It has also been asserted that the defendant No. 1 agreed to pay interest on the amount overdrawn at the rate of 4 % over and above the State Bank of Pakistan rate with a minimum of 13 % per annum with quarterly rests. It has also been averred that defendant No. 1 fully availed of the overdraft limit on different dates.
3. It has also been averred that the sister concern of defendant No. 1 known as Green Hosiery Mills of which defendants 2 and 3 as well as Haji Abdur Rehman and S. Mohammad Ismail were partners maintained another current, mutual and open account at the same branch being Account No. 3007. It has also been averred that the plaintiff at the request of the sister concern granted overdraft facility to the said sister concern in the sum of Rs. 1 lac in Account No. 3007 which was fully availed of on 30-12-1976. A sum of Rs. 1,49,797.81 became due and payable by the said concern in the said Account and that a separate suit for the recovery thereof is being filed in this Court simultaneously with the above suit. It has further been averred that as security for the repayment of the amount overdrawn or to be overdrawn and for repayment of the ultimate balance remaining unpaid, defendant No. 1 on 7-3-74 executed and delivered to the plaintiff with two covering letters, demand promissory note of Rs. 85,000 carrying interest at the rate of 4 % over and above the State Bank of Pakistan rate with a minimum of 13 --/ per annum with quarterly rests. It has also been stated that on 7-3-74, defendant No. 2 has by way of security for the due payment of all the moneys overdrawn or to be overdrawn by defendant No. 1 under the aforesaid overdraft in the said account as well as in Account No. 3007 of the sister concern and/or which might at any time tie found due and payable by defendant No. 1 with the intention of creating equitable mortgage of his immovable property, i. e. Plot of land with building and structure thereon bearing Survey No. 123, Survey Sheet No. O. T. 8, measuring 409 sq. Yds. Or thereabout deposited the documents of title relating to the said property with the plaintiff and executed and delivered a consolidated memorandum of deposit of title deeds dated 7-3-74 in respect of the aforesaid two accounts. It has further been averred that on 30-9-75 a sum of Rs. 98,688.15 became due and payable by defendant No. 1 and/or the defendants 2 and 3 jointly and severally to the plaintiff in the said account as well as another sum of Rs. 1,28,504.15 in Account No. 3007 of the sister concern. It has also been asserted that the plaintiff by its letter dated 17-1-76 required the defendant No. 1 to pay the said amounts within 7 days of the receipt thereof. It has also been stated that the defendant No. 1 by its letter dated 25-1-76 acknowledged its liability in the sum of Rs. 98,588.15 (besides acknowledg--ment of liability in the aforesaid Account No. 3007 of its sister concern in the sum of Rs. 1,28.504.15, and promised to repay the dues within 6 months and/or earlier. It has been further asserted that the-defendants failed and neglected to pay the above amount and consequently on 30-12-76 a sum of Rs. 1,15,413.36 inclusive of interest became due and payable -by the defendants in the said account jointly and severally. It has further been asserted that a sum of Rs. 1,49,797/81 also became due and payable to the plaintiff in the aforesaid other Account No. 3007 of the sister concern and for the recovery of the said sum a separate suit has been filed simul-- taneously.
4. The defendants have filed a joint written statement in which the defendants have raised the preliminary objections about the maintainability of the suit under Order XXXIV, C. P. C. And competency of the persons who have verified the plaint. It has also been averred that the suit is also barred under Order II, rule 2, C. P. C. In view of the earlier suit being Suit No. 761/76. It has also been asserted that the bank documents, namely, pronote and other bank documents were obtained under threat of cancellation of the overdraft facilities and are void and inadmissible in evidence. It has been further averred that the plaintiff having caused these defendants to sign on blank documents at the time of granting of overdraft facility and thereafter from time to time was due mainly to their dominating position over these defendants, and that the said documents are thus void and have no sanctity in law. It has also been averred that defendant No. 1 is not a registered partnership firm but it has been admitted that defendants 2 and 3 were the partners of defendant No. 1 till 31-3-70, it has also been denied that pronote was executed or delivered on 7-3- 74 or that mortgage was created on the said date as the security for the overdraft facilities by defendant No. 2. It has also been denied that the letter referred to in para. 2 of the plaint was executed on 7-3-74. It has been further averred that defendant No. 1 had been maintain--ing current account with the plaintiff's foreign exchange branch for the last several years and that the plaintiff had unauthorisedly and arbitrarily and for their own convenience transferred the said account at their cloth market branch on 7-3-74. It has been further asserted that the defendants came to know about it later on and that the present account was thus opened by the defendants in these circumstances. It has also been averred that the overdraft facilities to defendant No. 1 in the account at foreign exchange branch were allowed against the hypothecation and against the letter of credit and/or bills of defendant No. 1 to be collected and appropriated by the plaintiff. It has also been denied that the overdraft facility was fixed on 7-3-74 upto Rs. 85,000. It has also been denied that Haji Abdur Rehman and S. Mohammad Ismail were partners in the sister concern, namely, Green Hosiery Mills at the relevant time or that a limit of Rs. 1 lac was granted or that Rs.
5. 1,49,797.81 were still due and outstanding against the said sister concern on 31-12-76. It has also been denied that any pronote for Rs. 85,000 dated 7-3-74 carrying interest at the alleged rate was signed or delivered to the plaintiff on the alleged date It bas further been asserted that the plaintiff has unauthorisedly and illegally filled in the blank printed documents obtained from the defendants from time to time. It has also been asserted that there was no occasion of signing and executing these documents on the said date as there was hardly anything against these defendants and more so the same was duly secured by hypothecation of goods and Letters of Credit. It has also been denied that the letter referred to in para. 8 of the plaint is an acknowledgment of liability of Rs. 98,588.15. It has also been denied that any amount is due and payable to the plaintiff by the defendants. It has also been asserted that the statement of account is full of unauthorised and illegal entries. It has been asserted that no amount is due and payable to the plaintiff and that no cause of action accrued to the plaintiff for the suit. It has also been denied that Messrs Mohammad Munir Uddin and Ibrahim H. Bawani are competent or authorised to verify the plaint. It has been asserted that the suit has been filed by incompetent persons. It has further been stated that the plaintiff is not entitled to any relief claimed nor the same can be granted to them. It has further been stated that the suit merits dismissal with special costs to these defendants.
6. The above suit came up for final disposal on 28-3-78 when the Court settled the following issues;-- - "(1) Whether the suit is maintainable, or barred by any provision ?
(2) Whether the plaint has been signed by the competent person ?
(3) Whether the pronote and the memorandum of deposit of title deeds were executed on the dates specified in them. If so, what is its effect ?
7. (4),Whether the defendants had made any acknowledgment of their liability ?
(5) To what relief or reliefs, if any, the plaintiffs are entitled to ?"
8. I intend to deal with each of the issues separately and my findings are as follows :- Issue No. I. -The learned counsel for the defendants, Mr. Sami Ahmed Tirmizi has contended that the suit is not maintainable on the following grounds;
(1) That the suit is not maintainable under Order XXXIV against defend--ants Nos. 1 and 3 as the alleged equitable mortgage was created by defendant No. 2 only,
(2) that the mortgage is not valid as the memorandum of depositing of title deeds Exh. 5/2 contains the terms and conditions of the mortgage and, therefore, it should have been registered compulsorily by virtue of section 17 of the Registration Act. The alternate plea raised by the learned counsel is that the property was in the names of 3 persons whereas the alleged mortgage was created by one person, namely, defendant No. 2.
(3) that the suit is bad for the misjoinder of causes of action as there is no nexus between the cause of action for the equitable mortgage and the cause of action for money simpliciter.
(4) that the suit is barred under Order II, rule 2, C. P. C. As the plaintiff had filed another suit, namely, Suit No. 761, 76, in which they have not claimed the relief prayed for.
9. The first contention of learned counsel for the defendants is that the suit under Order XXXIV, C. P. C.
10. Is not maintainable as equitable mortgage was created by defendant No. 2 only. It will suffice to say that the preliminary decree for the sale of the mortgage property will be passed against defendant No. 2 only and not against defendants 1 and 3. But in case the plaintiff fails to obtain a preliminary decree for the sale of the mortgaged property the money decree will have to be passed against the defendants jointly and severally. The above contention has no force and does not require any further discussion.
11. Referring to the second contention, namely, that the memorandum of depositing of title deeds contains the terms and conditions of the mortgage and does not incorporate the past transaction.
12. It will be pertinent to refer to the contents of the said memorandum (Exh. 5/2) the relevant portion of which is contained in the 1st six lines in para. 1 which reads as followsp;--- "I hereby confirm and place on record that I have already deposited with you at Karachi, the Title Deeds mentioned in Schedule I here under written with the intention of creating an Equitable Mortgage on the property described in the Schedule II hereunder written and evidenced by the said Title deeds by way of continuing security for repayment of the above referred loan/overdraft cash credit/bank guarantee/letter of credit/margin and other similar banking facilities in the overall limit of Rs. 2,60,000 (Rupees two lac sixty thousand only) together with interest at the rate of 10 % per annum with a minimum of 4 % per annum above the Bank rate."
13. A perusal of the above-quoted lines from the memorandum shows that the memorandum witnessed the fact that defendant No. 2 had already deposited with the plaintiff title deeds mentioned in the Schedule with intention of creating an equitable mortgage on the property described in Schedule II of the said memorandum. In other words the memorandum confirms the fact that the defendant No. 2 with the intention of creating an equitable mortgage had already deposited his title deeds with the plaintiff as a security for the overdraft facilities. Mr. Sami Ahmed Tirmizi has further contended that the fact that the above memorandum contains the rate of interest which the defendants were supposed to pay in fact amounts to incorporation of the terms and conditions of the mortgage warranting registration of the same. The above contention is not borne out from the memorandum, as the same only incorporates the fact that the defendants had already agreed to pay interest at the rate specified therein. I am, therefore, of the view that the learned counsel for the defendants' contention that the mortgage is not valid is devoid of any force.
14. Referring to the third contention that the suit is bad for misjoinder of causes of action, it has been contended by the learned counsel for the defendants that the cause of action for mortgage cannot be joined with the cause of action for the recovery of money. In this connection the learned counsel has cited PLD 1976 Quetta 1 and AIR 1936 P C 34. The above rulings have no bearing whatsoever on the point in issue and, therefore, are not to be discussed. On the other hand the learned counsel for the plaintiff has cited a case of Bank of Bahawalpur Ltd. v. Siddlque Textile Mills and others (PLD 1970 Kar. 643) decided by my Lord Mr. Justice Dorab Patel (a9 he then was). The above case is directly on the point in issue. In the above case also the bank had filed the suit under Order XXXIV, C. P. C.: praying therein for a preliminary decree for sale of the mortgaged property and also for a decree for the balance of its claim on the basis of promissory note. It was held that the suit was not bad for misjoinder of the causes of action. It may be advantageous to quote herein below para. 9 at p. 650 from the above ruling which reads as follows;--- "I shall now briefly examine the judgments cited by Mr. Masood Hussain in support of his submission. In National Bank of Pakistan v. Sattar and others PLD 1962 Kar. 271 as in the instant case, the plaintiff was a bank, and as security for the advances it had given to the defendants it had obtained from them promissory notes as well as a mortgage of immovable property. But unlike the instant case it had first filed two suits under Order XXXVII, C. P. C. Against them solely on the basis of the promissory notes. Thereafter, it had filed another suit on the mortgage. It had then obtained a decree in one of the suits on the promissory notes. After obtaining this decree it had continued to prosecute its second suit on the promissory notes and its mortgage suit. Qadeeruddin Ahmed, J., as he then was, now the Chief Justice, was struck by the possibility that this would enable the plaintiff to recover the decretal amount twice and might be contrary to the provisions of Order II, rule 2, C. P. C. Therefore, although the defendants were ex parte he examined the question whether the plaintiff could file separate suits on the mortgage and on the promissory notes which had been given as security for the same advance. Order Il, rule 2, in so far as it is relevant, prescribes that if a plaintiff is entitled to more than one relief in respect of the same cause of action he may sue for all or any of such reliefs, but if he omits, except with the leave of the Court, to sue for all such reliefs, he shall not afterwards be permitted to sue for any reliefs so omitted. As in its earlier suit the plaintiff had not sued for relief on its mortgage and had also not obtained the leave of the Court for not suing for such relief, Qadezruddin Ahmed, J., held that the plaintiff's mortgage suit was barred by Order 11, rule 2, C. P. C. I am in respectful agreement with this judgment, but I do not see how it is relevant to the instant case. On the contrary, as in the judgment cited, the plaintiff's mortgage suit was dismissed because it had not included this relief in its earlier suit, it supports the contention of Mr. Afzal Nabi that he is entitled to sue defendant on the mortgage in this suit. Mr. Masood Hussain then referred me to Habib and others v. Poulat Ram AIR 1956 Raj.
121. The facts of that case were that the judgment debtors had executed a mortgage of a house in favour of the appellants, and on the same day the mortgagees had leased back the same house to the judgment-debtors on a monthly rent of Rs. 200. As the mortgagors failed to pay rent to the mortgagees, the mortgagees filed a suit against them for the recovery of the arrears of rent due to them. After their claim was decreed, in execution proceedings against the mortgagors, they filed an application for the sale of the mortgaged property. But, as this application was dismissed, they filed an appeal in the Rajastan High Court. The learned Judges of Rajastan High Court held that the agreement for the payment of rent was , part and parcel of the mortgage, therefore they dismissed the appeal of the mortgagees and agreed with the view of the trial Court that the mortgagees could sell the mortgaged property only by filing a suit for the sale of that property under Order XXXIV, C. P. C. I am in respectful agreement with the principle laid down in this judgment that when a plaintiff seeks to enforce his rights as a mortgagee, he can do so only by expres3ly praying for an order for the sale of the mortgaged property, otherwise, as I have explained in para. 8 the consequences would be extremely inequitable and harsh. But as that is precisely what the plaintiff has done in the present suit. I cannot understand how the judgment can help the case of the defendants. Finally, learned counsel relied on a judgment of the Sind Chief Court in Topandas v.
15. Tikamdas A 1 R 1947 Sind 12 there a mortgagee had obtained a preliminary decree against the mortgagors under Order XXXIV, C. P. C. But thereunder he had slept over his rights and his application for a final decree was dismissed as time barred. He then filed a regular suit on the basis of the preliminary decree. But Davies, C. J., and Thadani, J., held that the suit was barred. I am in respectful agreement with this view, but the judgment cited is totally irrelevant to the question under consideration because the plaintiff has expressly prayed in the plaint for the sale of the mortgaged property."
16. A perusal of the above para. Shows that if the plaintiff in the instant case would not have claimed the relief on the promissory note also or on their original cause of action simpliciter for money their subsequent suit would have been barred under Order II, rule 2, C. P. C. I am, therefore, of the view that there is no misjoinder of causes of action and the suit is not/ defective on that account.
17. Referring to the last ground, namely, that .The suit is barred under Order II, rule 2, it has been contended by the learned counsel for the defendants that the plaintiff should have claimed the relief prayed for in the present suit in their earlier suit, namely, Suit No. 761/76. In support of this contention the learned counsel has referred to the case reported in Muhammad Khalil Khan v.
18. Mahbub A.I Mian and others (PLD 1948 P C 131). Abdur Rashid v. Burmah Shed Oil Storage and Distribution Company of Pakistan Ltd. And others (PLD 1966 Kar. 126), Fazal Muhammad v.
19. Muhammad Noor (PLD 1975 Pesh. 17) and Abdul Hakim and 2 others v. Saadullah Khan and 2 others (P L. D 1970 SC 63). In all the above cases it has been discussed as to when the provisions of Order II, rule 2, C. P. C. Are attracted to. In the above Supreme Court case my Lord Mr. Justice Sajjad Ahmed Jan has observed as follows;---- "The expression "cause of action" in Order II, rule 2, C. P. C. Means the cause of action for which a suit is brought. In order that the cause of action for the two suits may be the same, it is necessary not only that the facts which would entitle the plaintiff to the right claimed must be the same but also that the infringement of his right at the hands of the defendants complained against in the two suits, must have arisen in substance out of the same transaction. In considering the application of this bar, regard is to be had to the allegations in the two suits without reference to the defence that may be set up by the defendants. As laid down by their Lordships of the Privy Council in Muhammad Khalil Khan and others v. Mahbub A.I Mian and others PLD 1948 P C 131 'the bar under Order II, rule 2 refers entirely to the grounds set out in the plaint as the cause of action or, in other words, to the media upon which the plaintiff asks the Court to arrive at a conclusion in his favour': A rough test, although not conclusive one is to see whether the same evidence will sustain both suits which would be the case if both the suits are founded on continuous and inseparable incidents in the same transaction. The question, however, is to be examined in substance and not merely on form as the cause of action in the two suits may be found to be the same, in spite of the facts alleged not being exactly identical in the two cases. It is not open to the plaintiff to split up the parts really constituting the same cause of action and file different suits in respect of them. In other words, a plaintiff must ask for all his reliefs which flow from the grievances caused to him by the infringement of his rights by the defendant in the course of the same transaction, but he cannot and is under no obligation to add to his grievances which did not occur in that transaction."
20. If we apply the above criterion laid down by our Supreme Court it becomes very clear that in the instant case the provisions of Order 11, rule 2, C. P. C.'E are not attracted to inasmuch as in the present suit there are three' defendants whereas in Suit No. 761/76 there are five defendants, for the reason that there were two partners in defendant No. 1 firm in the instant case, and that there were four partners in the firm which is defendant No. 1 in Suit No. 761/76. Furthermore, there were separate overdraft facilities with different limits. In addition to that there is a separate account, and the documents, namely, promissory note, etc. Executed by the partners in Suit No. 761/76 are also different. The only common factor between the two suits is that a common property has been mortgaged for securing the two overdraft facilities but this fact alone will not attract the provisions of Order II, rule 2, C. P. C.
21. It has also been pointed out by the learned counsel for the plaintiff Mr. Abdul Hamid Khan that as a matter of fact the above suit and Suit No. 761/76 were presented simultaneously at the same time and on the same date, namely, on 31-12-1976, and therefore, the provisions of Order II, F rule 2, C. P.
22. C. Are not attracted. In view of the above fact it cannot urged that the plaintiff has failed to claim any relief in their earlier suit as to attract Order II, rule 2, C. P. C. As a result of above discussion, my answer to issue No. 1 is in the negative and I hold that the suit is maintainable and is not barred by any provision.
23. Issue No. 2.-The learned counsel for the defendants has contended that under Order XXIX, rule 1, C.
24. P. C. a pleading on behalf of a corporation may be signed and verified by the Secretary or by any Director or other Principal Officer of the Corporation who is able to depose to the facts of the case.
25. It had been contended by him that Messrs Muhammad Munir and Ibrahim M. Bawani who have signed the plaint on behalf of the plaintiff in the present suit do not fall within the categories of the persons specified in the above rule of Order XXIX, C. P. C. And, therefore, the suit has not been validly filed. Reliance has been placed by the learned counsel for the defendants on the two cases of the Supreme Court of Pakistan, namely, in the case of Messrs Muhammad Siddique Muhammad Umer v. Australasia Bank Ltd. (PLD 1966 SC 684) and the case of Khan Iftikhar Hussain Khan of Mamdot v. Messrs Ghulam Nabi Corp. Ltd. (PLD 1971 SC 550). In the first case the Australasia Bank Ltd. Filed a suit for the recovery of a sum of Rs. 25---662.3 against the appellant's firm. The plaint in the suit was signed by one Muhammad Khan who described himself as the Principal Special Officer of the plaintiff bank with respect to the bank's refugee branch from the Indian dominion after its partition from Pakistan dominion. He also described himself as the General-Attorney in addition to being Principal Special Officer conversant with the facts of the case relating to Delhi Branch of the bank. The defendant in the suit and the appellant before the Supreme Court challenged the competency of the above Muhammad Khan to sign the plaint on behalf of the bank. The learned trial Judge dismissed the suit on the ground that the plaintiff/respondent failed to satisfy the Court that said Muhammad Khan was competent to file a suit as the attorney of the bank. Neither the Articles of Association were filed nor was any resolution of the Board of Directors put in, nor was any time asked for to produce these documents or adduce further evidence before the trial Court. On appeal to the High Court by the bank the learned Judges of the Division Bench constituted to hear the appeal differed, One of the learned Judges agreed with the view taken by the trial Court while the other Judge took the view that the trial Court was wrong in taking the view that the plaintiff bank was in law required to establish the points referred to by the trial Judge to make the suit filed by Muhammad Khan an attorney appointed under registered power of attorney bearing the common seal of the bank a competent suit. The Bench formulated the points of difference as follows;---- "(1) Was the suit out of which this appeal has arisen validly instituted on behalf of Australasia Bank Ltd. ?
(2) Has it been proved by the evidence on record that the amount of Rs. 25,662.3 was due from the defendant to the plaintiff ?
26. The third learned Judge to whom the case was referred felt that in order to pronounce the judgment it was necessary to see the Articles of Association of the bank and also other documents relating to the appointment of Muhammad Khan as the bank attorney. The third learned Judge took additional evidence under Order XLI. Rule 27, C. P. C. The bank produced the Articles of Association and a copy of Resolution dated 20th December 1942, to show that the Board of Directors had actually held a meeting granting the power of attorney to Muhammad Khan and its registration and that that they (Directors) were empowered to do so. The third learned Judge after having the additional evidence came to the conclusion that the suit was competently instituted. In the appeal before the Supreme Court inter alia competency of the suit was agitated and their Lordships of the Supreme Court at p. 694 in sub-pares. (2) and (3) observed as follows;--- "It was apparent from the pleadings that the suit was being instituted by a constituted attorney of a public limited company. He could only do so if he was duly authorised in that behalf and occupied one or other of the offices mentioned in rule 1 of Order XXIX of the Civil Procedure Code. A copy of the power of attorney had been produced which showed that Muhammad Khan had been empowered in that behalf but the question still remained to be ascertained as to whether those who gave him that power were competent to do so, as the authority was on behalf of a public limited company. For this purpose a reference to the Articles of Association of the company was certainly necessary to see whether the Directors were competent to delegate such power. It was not necessary to see whether the Directors had in fact approved of the giving of such power of attorney to the person who presented the plaint. This was, however, proved by the production of the resolution of the Board of Directors as a matter of abundant caution. The additional evidence was to that extent therefore, in our opinion, rightly admitted. This was all that was required. It was not necessary to call the Managing Director as the Court calling for the additional evidence itself realised subsequently. Even the production of the resolution could have been dispensed with, as it was not strictly necessary."
27. "111. Without prejudice to the general powers conferred by the last preceding clause, and the other powers conferred by these presents, it is hereby expressly declared that the directors shall have the following powers, that is to say power :---
(5) To appoint, and at their discretion, remove or suspend such managers, secretaries, officers, clerks, agents and servants for permanent, temporary or special service, as they may from time to time think fit, and to determine their powers and duties and fix their salaries or emoluments, and to require security in such instances and for such amount as they think fit.
(13) To institute, conduct, defend, compound; or abandon any legal proceedings, by or against the Company, or its officers, or otherwise concerning the affairs of the Company, and also to compound and allow time for payment or satisfaction of any debts due and for any claims or demands by or against the Company.
(17) From time to time to provide for the management of the affairs of company outside Karachi in such manner as they think fit and in particular to appoint any persons in or outside Karachi to be the attorneys or agents of the company with such powers (including powers to delegate) and upon such terms as may be thought fit.
113. The Directors may at their discretion delegate to any manager or other officer such of their powers as they are not expressly prohibited from delegating for such time and subject to such conditions and restrictions as they may think expedient and may at any time revoke or vary any of such delegated powers."
28. A perusal of the above-quoted paragraphs shows that under sub-paragraph (5 of paragraph 111 the directors have the power to appoint managers, secretaries, officers, agents, etc. And to determine their powers and duties. Under sub-paragraph (13) the directors have the power to institute, conduct, defend, compound or abandon any legal proceeding by or against the Company o its officer or others superintending the affairs of the Company, etc. Further. q more, under sub-paragraph (17) the directors have the power to appoint any person as the attorney of the Company and under paragraph 113 the directors have the power to delegate their power to any manager or other officer of the bank. In view of the above clear provisions it cannot be contended that the two attorneys who had signed and verified the plaint bad no power to do so. I may also observe that there was no need o producing the Board of Director's resolution, for authorising the execution of the above power-of-attorneys in view of the observation of their Lordships in the aforesaid Supreme Court judgment reported in PLD 1966 SC 684 referred to hereinabove. Mr. Abdul Hameed Khan the learned counsel for the plaintiff has also referred to me the provisions of the Banks (Nationaliza--petition) Act, 1974 (Act XIX of 1974). In this regard, it will suffice to say that sub-clause (b) of section 16 of the Act saves all contracts, deeds, agreements and powers-of- attorneys, etc. Referring to the second ruling of the Supreme Court relied upon and referred to hereinabove reported in PLD 1971 SC 550, it may be observed that the facts of the above case are distinguishable inasmuch as in the above case the plaint was not signed by the attorney of the Company but by an alleged Director Incharge of the Company, and in that context, it was held that the plaintiff was required to produce a resolution of the Board of Directors authorising the filing of the suit by the said alleged Director Incharge of the company. The alleged copy of the resolution produced by the plaintiff at some stage of the legal proceeding was disbelieved by the Supreme Court Inter alia for the reason that the appellant/defendant was also a Director of the Company, who had not received the notice of the meeting in question in which the filing of the suit was authorised. As the above ruling is not applicable to the instant .Case which is covered on all fours by the above-cited ruling of 1966 SC 684 no further discussion is required on PLD 1971 SC 550. It may be pertinent to mention here that under rule 2 of Order III, C. P. C. a person holding the power- of-attorney is a recognised agent for the purpose of appearance and filing of application etc. I and under rule 14 of Order VI, C. P. C. a pleading can be signed by any person duly authorised by a party. A reference to the case of All India Report Ltd., Bombay v. Ramchandra Dhondo Datar (AIR 1961 Bom. 292) can be made in support of the proposition that the Board of Directors or a Managing Director of a company having the power of the management of the company may authorise any person orally to sign a plaint on behalf of the company. I do not wish) to express my view about the correctness of the above proposition as the instant case does not need any decision on the above proposition. I accor--dingly hold that the suit has been validly filed by the persons who were competent to file it.
29. Issue No. 3.----Learned counsel for the defendants contended that though Exhs. 5/11 to 5/13 contained, 7-3-1974 as the date of execution of the above documents but factually the above documents were obtained by the plaintiffs' officer blank in 1971 and were executed in May 1971. In support of his above contention the learned counsel has referred to a debit note dated 5-4-1971 Exh. 5/21 issued by the plaintiff's bank foreign exchange branch in the name of defendant No. 1 whereby inter alia a sum of Rs. 14 was debited as the costs of the stamps. The above contention of the learned counsel for the defendants is belied -by the other documents which are on record, namely, the plaintiff bank's head office letter (Exh. 5/22) dated 15/16-1-74 addressed to defendant No. 1 asking them to submit valua--petition certificate and non-encumbrance certificate in respect of the property which is the subject matter of the suit. In response whereof the defen--dant No. 1's sister concern submitted aforesaid documents through its letter dated 22-1-1974 Exh. 5/4. In view of the above documents, it can be presumed that the documents in question referred to hereinabove were executed in 1974 and not in 1971 as alleged by the defendant. Mr. Abdul Hamid Khan learned counsel for the plaintiff has also invited my attention to section 20 of the Negotiable Instruments Act which is a complete answer tothe defendant's above contention. Section 20 of the Negotiable Instruments Act reads as follows;--- "Where one person signs and delivers to another a paper stamped in accordance with the law relating to negotiable instruments then in force in British India and either wholly blank or having written thereon an incomplete negotiable instrument, he thereby given prima facie authority to the holder thereof to make or complete, as the case may be, upon it a negotiable instrument, for any amount specified therein and not exceeding the amount specified therein and not exceeding the amount covered by the stamp. The person so signing shall be liable upon such instrument, in the capacity in which he signed the same, to any holder in due course for such amount : Provided that no person other than a holder in due course shall recover from the person delivering the installment anything in excess of the amount intended by him to be paid thereunder."
30. My finding on this issue is in the affirmative and I hold that the documents were executed on the dates which they bear.
31. Issue No. 4.-The defendants have admitted in their written statement the issuing of letter dated 21- 1-1976 Exh. 5/15 which has been signed by defendant No. 3 in the present suit, in which inter alia it has been admitted that a sum of Rs. 98,688.15 was due against the defendant No. 1. The learned counsel for the defendants has contended that the above admission/ acknowledgment was made after the expiry of the period of limitation and, therefore, the above acknowledgment is in fact no acknowledgment in law. The above contention of the learned counsel for the defendants is belied by Exh. 5/19 which is a statement of account which shows that on 30-12-1975 the above sum of Rs.
32. 98,688.98 was due and payable by the defendants. The above statement also shows that the defendant had made part payments towards the above overdraft facility inter alia, on 21-8-1974, 4-9-1974, 26-9-1974 and 10-10-1974. Therefor, the acknowledgment was made by the defendants after making the above part payments towards their liability at the time when the cause of action had subsisted and had not become time barred . My answer to this issue is in the affirmative and I hold that the defendants had made acknowledgment of their liability contained in Exh. 5/15.
33. Issue No. 5.---The learned counsel for the defendants has contended that the statement of account Exh. 5/19 is not in accordance with the Bankers Books Evidence Act, 1891 for the reason that the name of the person who had prepared the above statement is not given. This is not correct. The above statement bears the name and the same has been proved by P. W.
1. The second contention was that the plaintiff have not complied with the provisions of section 34 of the Evidence Act and have not proved the above statement of account in accordance with the above provisions of the Evidence Act. The above contention is also devoid of any force as there is sufficient corroborative evidence in support of the above statement of account inasmuch as the above statement shows a sum of Rs. 98,688.98 as the amount due and payable on 30-12-1975 which is corroborated by the defendant's letter dated 21-1-1976 Exh. 5/1.5 in which they have admitted their liability to the above amount. The further entries in the above statement of account relate to only debit entries in respect of interest which accrued to the plaintiff. The defendants have not pointed out that any of the entries subsequent to 30-12-1975 relating to debiting of interest was incorrectly made and, therefore, the above statement is to be taken as correct. In view of my above discussion I pass a preliminary decree against the defendant No. 2 in Form 5-A in Appendix D to the First Schedule and declare that Rs. 1,15,413.66 is due and payable to the plaintiff, with 10% interest thereon from the date of suit and costs. If the defendants Pay into the Court the above amount within 6 months from today with subsequent costs, charges and expenses as provided under rule 10 of Order XXXIV, C. P.
34. C. Together with subsequent interest on the above amount the plaintiff shall deliver to the defendants or to such person as the defendants appoint all documents in their possession or power relating to the mortgaged property and shall if so required retransfer the property to the defendants at their costs free from mortgage and free of encumbrance created by the plaintiff or any person claiming under them. If the not proceeds of the sale of the mortgaged property are found insufficient to pay the amount due to the plaintiff, they may apply to the Court under Order XXXIV, rule 6, C. P. C. For a decree for the balance amount against the defendants in accordance with law. I may clarify that the foregoing is without prejudice to the rights of the parties in the pending Suit No. 761/76 referred to hereinabove.