WAHID BUX BROHI, J.-- Appellant M/s. Doha Bank Limited, through this High Court. Appeal under Section 21 of the Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997 has assailed the judgment and decree of a learned Single Judge of this Court passed in suit No. 825 of 1998.
2. The facts relevant for the purpose of . this appeal,concisely stated, are that in June, 1998 M/s. Pangrio Sugar Mills Limited, respondent No. 1, filed a suit under the Banking Jurisdiction of this Court for declaration and injunction against respondents Nos. 2 and 3 (defendants Nos. 1 and 2) and the appellant herein (defendant No. 3).
3. The claim of Sugar Mill, respondent No. 1/plaintiff, was initially founded on exemptions allowed by the Government in central excise duty on account of excessive production of sugar, but the exemptions were subsequently withdrawn through two notifications i.e. SRO No. 555(1)/89 and No. 556(1)/89 both dated 3.6.1989. The. Customs and Central Excise Department through letter dated 4.5.1989 informed the respondent No, 1/plaintiff that in consequence of withdrawal of exemptions the entire stock of sugar available in the defendant No. 1 /plaintiff's factory was subject to central excise duty at the rate of Rs.2.15 per kg. The respondent No. 1/plaintiff challenged the notification and the aforesaid letter in this Court through C.P. No. 713 of 1989 whereupon the recovery of central excise duty was stayed by this Court subject to furnishing of bank guarantee. As a result the respondent No. 1/plaintiff furnished a bank guarantee issued by appellant/defendant No. 3 bearing No. 21/89, dated 26.8.1989 in the sum of Rs.21,236,249/- .which, eventually forms the subject-matter of the suit as also the instant appeal. The Constitutional petition was, however, dismissed by this Court alongwith other similar petitions on 29.11.1990 which decision was challenged in the Supreme Court. The Hon'ble Supreme Court, after admitting the matters, heard all the appeals and allowed the appeal of respondent No. 1, Civil Appeal No. 112(K)/91 and some other appeals vide judgment dated 26.4.1992 reported as Army Welfare Sugar Mill Limited v. Federation of Pakistan (1992 SCM R 1652) remanding the case to Central Board of Revenue with direction to inquire into the following aspects:-
(i) How much quantity of sugar manufactured by the appellants in the financial year in question upto the date of rescission of SRO 560(1)/82. On 3.6.1989, exceeded the average production for the preceding two years of the factories under reference.
(ii) Whether the appellants had passed on the additional 4. amount of the excise duty or part thereof which became due and payable on the above excess quantity of sugar on account of the rescission of SRO 560(1)/82, to the purchasers and/or to any other person or persons.
5. It was further observed by the Hon'ble Supreme Court that in case the answer to above second question was in the negative then the Board of Revenue shall not charge any excise duty on the excess quantity of sugar, as determined in terms of above sub-para (i). After remand this question was determined in the affirmative by the Member, Central Excise and CBR, the respondent No. 1 therefore, filed a revision, which on account of amendment in the Central Excise Laws was transferred to the Appellate Tribunal to be heard as an appeal. The Appellate Tribunal announced its short order on 16.5.1998 but in substance there was a split in the said decision, consequently, the matter was referred to the Chairman. Appellate Tribunal under Section 35(D) of the Central Excise Act for adjudication by another Member and until filing of the suit there was no final adjudication.
Consequently, the case of respondent No. 1/plaintiff was that the bank guarantee No. 21/89 remained intact as it was at the best subject to the final decision of the Appellate Tribunal or in appeal therefrom. On 6.6.1998 respondent No. 1/plaintiff received a letter from appellant/defendant No. 3 informing them that the respondent No. 3/defendant No. 2 had demanded immediate encashment/payment of Rs.21,235,249/- alongwith 14% mark-up from 26.8.1'989 till the date of payment and the respondent No. 1/plaintiff was called to replenish their funds with the appellant.
According to respondent No. 1, this was an illegal demand.
6. On the other hand the appellant had filed Suit No. 485 of 1995 against CBR, respondent No. 2, seeking mandatory injunction for return of bank guarantee for the purpose of cancellation.
However, interim injunction prayed therein was declined. Thereafter, the appellant/defendant No. 3, on demand of the Collector, Central Excise and Sales Tax respondent No. 3/defendant No. 2 paid- up the amount of bank guarantee i.e. a sum of Rs.21,236,249/-. The outstanding prayer in the suit (825/1998) is accordingly directed against the aforesaid payment, seeking a declaration that it was illegal, ma/a fide and without !awful authority. Injunction was also prayed for restraining the defendants in the said suit from affecting the payment of mark-up amounting to Rs.25,26,894.10.
Mandatory injunction was sought calling for a direction for recovery of the sum of Rs.21 ,236,249/ from the defendants in the suit with mark-up at the rate of 52 paisa per rupee per thousand per day from the date of suit till realization whereof.
6. The Collector, Central Excise and Sales Tax, respondent No. 3/defendant No. 2, in his written statement took the plea that the suit was result of collusion between appellant/defendant No. 3 and respondent No. 1 /plaintiff so that the order passed in the other Suit No. 485 of 1995 filed by the appellant/defendant No. 3 be defeated. However, he, in general terms denied the case of respondent No. 1/plaintiff and explained his position by asserting that the bank guarantee was encashed under the cover of the order passed by this Court which had attained finality and as such there was nothing illegal about it.
7. The appellant/defendant No. 3, in his written statement, did not controvert the case of respondent No. 1/plaintiff as far the exemptions were concerned but regarding the main controversy relating to encashment of bank guarantee No. 91/89 he pointed out that an other suit bearing No. 875 of 1995 filed by the respondent No. 1/plaintiff company against appellant was also pending adjudication before this Court. Nevertheless, referring to Suit No. 485 of 1995 he pleaded that pursuant to order dated 3.6.1998 passed by this Court and on demand of respondent No. 3/defendant No. 2 a sum of Rs.21,236,249/- was paid in the account of Collector of Central Excise and Sales Tax, Hyderabad.8. Consent issues were adopted in the suit (825/98) on 11.1.1998 but no evidence was led. The suit came up before, the learned Single Judge of this Court on 31.3.1999 and was disposed of by the impugned judgment, which being a short one, is reproduced herein below:- "Mr. Asghar Farooqui, learned counsel for plaintiff and Mr. Sohail Muzaffar, learned counsel for defendant No. 2 have 'filed their Written Arguments and have exchanged copies of the same. It appears that the only controversy between the parties now is the point of time at which defendant No. 2 is liable to refund the amount of the Bank Guarantee No. 21/1998 which was encashed by defendant No. 2 because of the Special Customs Appeal No. 33/1998 filed by defendant No. 2 before this Court, Mr. Farooqui states that he would be satisfied if defendant No. 2 refunds the amount of the Bank Guarantee in accordance with the judgment of the said Appeal and also not charge or recover any Mark-up during the pendency of the Appeal. Mr. Sohail Muzaffar has filed a written statement to the effect that defendant No. 2 shall refund the amount of the Bank Guarantee to the plaintiff if the aforesaid appeal before this Court is decided in favour of the plaintiff. He also states that he shall not charge or recover any markup from the plaintiff until the decision of the appeal.
"Consequently, the suit is decreed by consent in the above terms with no order as to costs."
9. We have heard Mr. A.I. Chundrigar, Advocate for appellant, Mr. M. Ilyas Khan Tanoli, Advocate for respondent No. 1 and Mr. Fareeduddin, Advocate for respondents Nos. 2 and 3. Mr. Fareeduddin has adopted the arguments of Mr. Tanoli.
10. The judgment-sheet mentions presence of Mr. Asghar Farooqui, Advocate for plaintiff, Mr. Suhail Muzaffar, Advocate for defendant No. 2 and Mr. Azizur Rehman, Advocate for defendant No. 3 on that day viz. 31.3.1999. The decree was, however, signed subsequently on 29.5.1999 by the learned Single Judge, whereas the instant appeal had already been filed on 19.5.1999 annexing a certified copy of the judgment alongwith the memo. of appeal.
11. At the outset a technical objection was raised on behalf of the respondents that this being an appeal under Section 21 of the Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997, herein below to be referred as the Act XV of 1997, it can only be entertained if it impugns a decree and copy of such decree-is annexed to the memo of appeal, but at the time the appeal was presented no copy of decree was annexed for the obvious reason that till then the decree was not signed by the learned Judge, the appeal was not maintainable. Mr. Al.. Chundrigar, learned counsel for appellant controverted this contention by referring to the observation made by the Honourable Supreme Court in Baseer Ahmed Siddiqui v. Shama Afroz (1988 SCM R 892) and on the pattern of provisions of Order XL.I, Rule 1, CPC argued that filing of copy of decree alongwith memo of appeal was not a mandatory requirement as the aforesaid provisions were directory in nature.
12. While adverting to this contention we have noted that the requirement that the memorandum of appeal shall be accompanied by a copy of decree finds place in Rule 1 of Order XLI, CPC and not in Section 21 of Act XV of 1997. Nevertheless, on the analogy of the pforesaid provisions the observations made in Baseer's case (1988 SCM R 892) provide enormous guidance. In the cited case the view taken by the High Court was that the requirement of Order XLI, Rule 1, CPC to the effect that copy of decree shall accompany memorandum of appeal was a directly provision and the copy of decree received by the Appellate Court alongwith record of suit was sufficient to satisfy this requirement, which view was assailed by the learned counsel appearing in the said petition, but the Honourable Supreme Court observed that:- we, however, do not feel called upon to examine this contention. The fact remains that the respondent submitted application for copy on the same date when the judgment was announced by Trial Court
6. The other aspect of the case is that if the respondent had actually made an application for copy of the decree before the Trial Court, there is nothing on the record to indicate whether this copy was prepared and notice given to the respondent that the same is ready for delivery. All these circumstances seem to justify the conclusion of the High Court that the respondent was not at fault for not obtaining a copy of the decree from the Trial Court. In these circumstances we feel that it is not necessary to determine the question of law raised by the learned counsel, as we do not consider this a fit case to determine the same. In substance the High Court had condoned the delay in submitting the decree sheet by the respondent after the filing of the appeal."
13 The controversy that the aforesaid provisions were directory or mandatory, therefore, was not adjudicated upon by the Honourable Supreme Court in the cited case. All the same, the order of High Court in condoning the filing of decree sheet by the party was not set aside.
14. In the instant appeal it is noted that the decree was signed on 29.5.1999 and appeal was admitted by this Court on 1.11.2000. This objection, in the circumstances of the case, shall, therefore, not preempt decision of appeal on merits. The other operative part of contention is that there was no decree on the date of filing of appeal, therefore, no appeal could lie on that day, shall also not defeat' the appeal when subsequently at a stage when the decree had been signed the appeal was admitted by this Court to regular hearing.
15. Another contention strenuously advanced by learned counsel for respondents was that the judgment was passed by consent, therefore,. the consent decree drawn on basis of this judgment could not be .appealed against. This argument, in essence, is based on sub-section (3) of Section 96, CPC which lays down that no appeal shall lie from the decree passed by the Court with consent of the parties. Mr. A.I. Chundrigar learned counsel for appellant while rebutting this contention referred to the plea taken in the memorandum of appeal under the caption ' Grounds' at para D read with para 7 of the Facts' and submitted that in fact he was on general adjournment from 22.3.1999 to 18.4.1999 and on 31.3.1999, the day the impugned judgment was passed, Mr. Azizur Rehman Advocate of his Office appeared in Court when the case was called in the earlier part of the day but was kept aside. Subsequently, when the impugned judgment was dictated Mr. Azizur Rehman was busy before DB-II and such information was communicated to the learned Judge, yet the matter was not kept aside but the judgment was dictated in absence of Mr. Azizur Rehman; consequently, it cannot be termed as a judgment passed by consent nor would the decree fall within the import of a consent decree. On the other hand Mr. Ilyas Khan Tanoli vehemently argued that within the meaning of rule laid down in Section 129 of the Qanun-e-Shahadat, illustration at clause (e) all judicial and official acts shall be presumed to have been regularly performed. He further submitted that affidavits of Mr. Azizur Rehman and Mr. Bashir, Advocates have not been filed and no affidavit has even been filed by the Advocate's Clerk. Further in support of his contention he relied on A.I.R. 1994 Madras 450 (Katta R. Venkatesayya v. Muhammad Ghous Saheb), 1992 M LD 2455 [Karachi] (Ghulam Rasool v. The State), PLJ 1980 Lah. 305 (Mohammad Zaman v. Abdul Ghaffar) and 2001 SCM R 60 (Abdullah v. Shaukat).
16. It has been observed in Abdullah's case (2001 SCM R 60) that genuineness of the judicial record cannot be sacrificed at the altar of expediency of a litigant. In the Madras case (A.I.R. 1944 Madras 450), the Madras High Court placing reliance on a precedent, 10 Born. H.C.R. 75, adopted the view that statement of a presiding Judge who presides at a trial, whether it be in a criminal or civil case, is, as to what has taken place at the trial, conclusive; and neither the affidavits of bystanders, nor of jurors, nor the notes of counsel, nor of short-hand writers are admissible to controvert the statement of the Judge. The following view taken in the said precedent was also endorsed:- "The question is, whether the affidavits of by-standers are to be admitted, to prove that the Judge, who presided at a trial is guilty of mistake as to what passed. If such affidavits were now received it would be the first instance of such a practice, and would produce the greatest injury to the administration of justice."
The aforesaid Madras case was referred to in PLJ 1980 Lah. 305. The view taken by this Court in 1992 M LD 2455 was more or less on the same lines holding that presumption of truth is attached to the record of the Court.
The foremost contention of Mr. A.I. Chundrigar, in substance, was that the presence of Mr. Azizur Rehman, an Advocate of his office, was noted on the top of the judgment where normally the appearance of counsel is recorded in consequence of an inadvertence. Notwithstanding the aforesaid error, he contended that it cannot be conceived from the text of the judgment that Mr. Azizur Rahman had conceded to a particular point rendering the judgment as a consent judgment as regards the appellant. The first part of this contention cannot be subscribed to for the simple reason, as pointed out by learned counsel for respondents, that no affidavit has been filed on behalf of Mr. Azizur Rahman or Mr. Bashir Ahmed who presumably held brief on behalf of Mr. Azizur Rehman or of the clerk Muhammad Aslam on whose behest Mr. Bashir Ahmed did so. It requires, however, to be clarified here that such affidavits could, at the best, hint at the alleged inadvertence on the part of Shorthand Writer/Private Secretary who noted the order on the dictation of the learned Judge and not against the learned Judge himself. In absence of such affidavit the contention, as projected by learned counsel, loses its significance. Secondly, as far the text of the judgment is concerned this Court, with profound respect, would agree with the views expressed in the judgment cited at the bar. Genuineness of the judicial record cannot be sacrificed for any extraneous reasons. The sanctity attached to the judicial record through the illustration at clause
(e) of Article 199 of Qanun-e-Shahadat shall not be injured or distorted. There can be no hesitation in observing that even the affidavits filed by anybody in support of the text of the judgment that is to say the statement of a Judge of High Court cannot be permitted to disfigure the above- mentioned presumption of genuineness attached to the judicial record. There shall, therefore, be no dispute about genuineness of what has been recorded in the judgment.
19. The remaining part of the argument is that even on a plain reading it cannot be conceived that there was consent on the part of appellant/defendant No. 3 towards the judgment. A thorough perusal of the impugned judgment which has also been reproduce, in extenso, at para 8 of this judgment, would reveal that no where it is stated that consent was expressly given on behalf of appellant/defendant No. 3 as to the refund of the amount of the bank guarantee to respondent No. 1/plaintiff or otherwise retaining of the said amount by the Collector, Central Excise and Customs respondent No. 2/defendant No. 2 to whom the amount has already been paid on encashment of the bank guarantee. On comprehending the judgment in terms employed therein I am inclined to agree with Mr. A.I. Chundrigar that no consent has been recorded in the impugned judgment on the part of appellant/defendant No. 3. At the best a tacit consent may be presumed on the part of Mr. Azizur Rahman, learned counsel appearing for appellant/defendant No. 3. Whether such consent can be presumed or not is a question apart and is not being dilated upon here, but for brining the cause within the fold of sub-section (3) of Section 96 of the Code of Civil Procedure I am of the humble view that in a judicial dispensation dealing with substantive rights of a party, the consent, if any, should be clear, express and unambiguous. Eventually, a consent decree operates as an estoppel, for, it is founded on the agreement of the parties who would consciously give-up their right of appeal in consequence of such agreement. There is no such express and comprehensible consent on behalf of appellant/defendant No. 3 I would, in consequence thereof, hold that as far the claim of appellant/defendant No. 3 demanding refund of the amount of bank guarantee to him is concerned there is no consent decree as against him and appeal would not be hit by the mischief of subsection (3) of Section 96 of the Code of Civil Procedure.
20. Notwithstanding the finding that maintainability of appeal shall not be questioned on the ground of impugning the aforesaid decree, the claim of the appellant/defendant No. 3 is to be assessed and examined on its own merits, As already painted out Collector Customs, respondent No. 3, had taken the plea,, in his written statement, that the encashment of the bank guarantee was claimed in pursuance of the order dated 3.8.1996 passed in Suit No. 485' of 1995 filed by appellant against the respondents. A copy of the order has been placed on record in this appeal. On perusal, it appears that interim injunction was sought through an interlocutory application filed in the said suit (4085/1995) for return of the bank guarantee for cancellation which was declined. Learned Single Judge of this Court had taken note of the legal position that refusal of interim order would entail payment of money by the appellant who was the plaintiff in the said suit to the respondent No. 3 who was defendant No. 2 therein, which can always be retrieved in the event of ultimate decree in favour of the plaintiff. A discreet approach to the above observations would indicate that there was no direction on the part of learned Single Judge in the said suit that the bank guarantee should necessarily be encashed Indeed, by the said order only the return of bank guarantee to the appellant M/s. Doha Bank Limited for cancellation was declined. In any event encashment of the Bank guarantee had been enforced after the aforesaid order but the said payment is being assailed on a totally different ground. As stated earlier, the case relating to exemption of excise duty, on remand to the competent authority under the order of Hon'ble Supreme Court fell under re-adjudication. However, the fact remains that the appellant, in his written arguments filed in the suit, stated that the demand of encashment by respondent No. 2/defendant No. 2 was a proper and bona fide request. Irrespective of this plea I would not agree with learned counsel for appellant that the encashment of bank guarantee was due, only because of the order dated 3.6.1998 passed in Suit No. 485 of 1995.
21. It goes without saying that the bank guarantee itself is creation of the order dated 26.7.1989 passed in Constitutional Petition No. 713 of 1989 which was disposed of on 29.11.1990 but challenged in the Hon'ble. Supreme Court where it was dealt with through the judgment dated 26.4.1992 reported as 1992 SCM R 1652. The bank guarantee was actually issued on 26.8.1989 and at one stage its encashment was stayed by the Hon'ble Supreme Court vide order dated 5.1.1991 until decision of the main petition which eventually was decided on the aforesaid date viz. 26.4.1992.
There is, however, no subsequent direction restraining encashment of the bank guarantee. The case was remanded by the Hon'ble Supreme Court to Central Board of Revenue with direction to inquire into the points as already reproduced in this order. It is, however, clear that in legal sense the stay granted by this Court on the condition of furnishing bank guarantee stood automatically vacated after six months within the meaning of rule laid down in Zahoor Textile Mill's case (PLD 1999 S.C. 88) but, however, at a subsequent stage, the encashment was saved until the disposal of the main petition by the Hon'ble Supreme Court. After disposal of the said petition there was no restriction as to encashment of bank guarantee and even interim injunction sought in Suit No. 485 of 1995 was refused by learned Single Judge on 3.6.1998.
22. It would not be out of the place to state that as a general principle the law is well-settled that the bank guarantees are independent contracts and the concerned parties must construe them independently as primarily contract and encash them notwithstanding any dispute arising out of the original contract between the parties. The law laid down in National-Construction Limited v.
Aiwan-e-Iqbal (PLR 1994 (S.C.) 311) the sufficient to cover this legal aspect. Since the bank guarantee, in the instant case, had served out its purpose it is now a matter between the guarantor namely the appellant and the Pangrio Sugar Mills Limited, the assessee/respondent No. 1 to settle scores inter se. Even before encashment the appellant had called upon Pangrio Sugar Mills Limited respondent No. 1/plaintiff to replenish its accounts. It is not known, whether the accounts were replenished or not, but this Court, in these proceedings, is not concerned with the said factual aspect, it is a matter between the appellant Bank and Pangrio Sugar Mills Limited to get such controversy, if any, determined.
23. Indeed, all secured financial dealings and business transactions such as execution of a bank guarantee etc. are based on commercial morality and mutual trust and confidence which should not be shaken by taking a turn much against the terms of the guarantee itself. The bank guarantee is a tripartite contract of guarantee between the bank, the beneficiary and the person at whose instance the bank issues such guarantee; the banker is not supposed to question the nature of accounts or liabilities between the two parties. As observed by a Division Bench of this Court in State Associates v. Farben Indus. Development S.P.A. (1992 M LD 1007) wherein reliance was placed on decisions of Indian Courts reported as AIR 1981 SC 1426 and (1989) 65 Comp. CAS. 283 (Supreme Court) that in order to restrain the operation of, inter alia, a hand guarantee there should be a serious dispute and there should be a good prima facie case of fraud, and special equalities in the form of preventing the irretrievable injustice otherwise the very purpose of Bank Guarantees would be negatived and the fabric of trading operations would get jeopardized. Viewed from this angle the instant case is neither that of fraud nor of irretrievable loss or damage. On the contrary, the last sentence in the bank guarantee indicates that the bank namely the appellant had agreed and undertaken to make unconditional payment of the aforesaid sum/duty to the Government of Pakistan on demand from the Collector, Central Excise and Land Customs, Hyderabad without question. If a banker is allowed to resile from the contents of the guarantee it would seriously prejudice the sanctity and confidence attached to bank guarantee. Consequently, it may be conceived that the banker had rightly made payment to the Collector Customs in pursuance of the guarantee. If the bank wants the money back the right course is not to disintegrate the terms of the guarantee itself but to take appropriate steps and settle the accounts with the Pangrio Sugar Mills Limited, respondent No. 1. The instant suit was not filed for that purpose. The prayer clause A' of the suit was to declare the demand made by Collector, Central Excise for payment under the said bank guarantee to be illegal and male fide. This prayer was directly and exclusively a matter between the Pangrio Sugar Mills Limited, respondent No. 1/plaintiff, and the Collector, Central Excise and Sales Tax, respondent No. 2/defendant No. 2. The judgment based on consent of these two parties is, therefore, not assailable as the decree to that extent would be a consent decree. As regards prayer clause `B` it relates to payment of mark-up in pursuance of demand made through letter dated 4.6.1998 by the respondent No. 2/defendant No. 2 and, therefore, the judgment based on consent of the Advocates for these two parties can also not be impugned on the same above mentioned principle. As regards the prayer clause C, the Collector, Central Excise, respondent No. 2/defendant No. 2, had consented to refund the amount of bank guarantee to the respondent No. 1/plaintiff, therefore, this part of the consent order was also not be questionable and, in essence, the impugned decree is a consent decree as for this relief is concerned.
24. On the whole, it may be concluded that even if the impugned judgment is taken as a consent judgment as far appellant/defendant No. 3 is concerned he is not affected by this judgment adversely within the domain of the cause of action set forth in the main Suit No. 825 of 1998 hence the appellant is not entitled to cell for setting side of the impugned judgment. In particular, no reasonable ground is found to interfere with the impugned judgment/decree on any rational basis.
The appeal is without merits as there is no legal infirmity or flaw in the impugned judgment/decree and is hereby dismissed with costs.