1. ' This is an application filed by the defendants for leave to defend The suit.
2. ' Mr. Arshad Tayebally learned counsel for the defendants in support of this application has contended firstly that the alleged dishonoured cheques upon which the suit has been filed under the Summary Chapter have neither been drawn/executed by any of the defendants but by and on behalf of Golden Mats (Pvt.) Limited, which Company has not been made a defendant to the suit and consequently, the suit is not maintainable against the defendants. In this regard learned counsel has referred to section 7 of the Negotiable Instruments Act which defines the term drawee, "drawer" etc. Of a cheque in none of which categories do the defendants fall. Secondly, learned counsel has submitted that some of the cheques, which have been drawn in the name of Messrs Sana International and Farhat International. Are no manner connected with the plaintiffs who admittedly are the sole proprietors of Ambreen Inter Trade & Brothers Trading Company. Hence there being, no nexus between the aforementioned two companies and the plaintiffs to that extent also the cheques drawn in the name of Messrs Sana International and Farhat International cannot be relied upon by the plaintiffs as they are not holders in due course of the same as per definition of this term provided in section 9 of the Negotiable Instruments Act. Next learned counsel has submitted that the suit is time-barred since all the cheques were issued in the months of June and July, 1995 whereas the suit was filed in the month of December, 1998. Learned counsel has further submitted that Annexure "D/1", which is the order of the District Magistrate, Karachi South, dated 28- 9-1995 and has been relied upon by the plaintiffs as an admission/acknowledgement by the defendants of their liabilities, is in fact, directed against Messrs Golden Mats (Pvt.) Limited and consequently cannot be deemed to be an admission/acknowledgement by the defendants of their alleged dues to the plaintiffs.
3. ' In reply Mr. Khawaja Shamsul Islam, learned counsel for the plaintiffs has contended that the plaintiff No,1 is the former sole proprietor of American International and the plaintiff No,2 is the former sole proprietor of Brothers Trading Company. He has also contended that the defendants have been described in the plaint as being the officers of Golden Mats (Pvt.) Limited. He has further submitted that as per the defendants' own admission all the cheques have been signed by defendant No,2 on behalf of Golden Mats (Pvt.) Limited and consequently, at least defendant No,2 is liable to pay the dues of the plaintiffs. He has further contended that as per Annexures "B/1" and "B/2" to the plaint, which are letters from Messrs Sana International and Farhat International addressed to plaintiffs Nos.1 and 2, it is quite clear that although the cheques mentioned therein were given directly to Messrs Sana International and Farhat International by Golden Mats (Pvt.) Ltd., the same were at the behest of the plaintiffs to whom credit was extended by Messrs Sana International and Farhat International and consequently once the plaintiffs had cleared the dues of Golden Mats (Pvt.) Limited/ defendants to these two companies they have stepped into their shoes and could, therefore, lawfully claim the amounts owing to Messrs Sana International and Farhat International under the cheques in question viz. Annexures "B/5/1" and "B-5/17". Finally, as to limitation learned counsel has submitted that in terms of Article 64-A of the Limitation Act a period of three years has been prescribed for filing of a suit under the Summary Chapter to begin when the debt becomes payable. Per learned counsel the cheques were dishonorued on 7-8-1995 when the cause of action firstly accrued to the plaintiffs. Learned counsel has further submitted that in terms of Annexure "D/1" viz. The order of the District Magistrate, Karachi (South) this is an admission by Mr. Hyder Rajkotwala, defendant No,2, that he owes the amounts demanded to the plaintiffs and that he also spoke for the other Director of Messrs Golden Mats (Pvt.) Limited viz. Defendants Nos.1 and 2 and he undertook to pay the balance of Rs,5.2 million owing to the plaintiff within three months to the plaintiffs. Learned counsel submits that as the order was passed on 28-8-1995 the money became payable on 27-12-1995 viz. Within three months and consequently, the suit filed on 26-12-1998 was within time. Further learned counsel has submitted that in para 10(vii) of the leave to defend application it has been admitted by defendant No,2 that he acted on behalf of the company viz. Messrs Golden Mats (Pvt.) Ltd. And a payment of Rs,5.2 million would be made by the said company to the plaintiffs. This according to the learned counsel is sufficient ground for the suit to be decreed against the defendants as per Annexure "D/1" to the plaint which is the order of the District Magistrate, Karachi South wherein the defendant No,2 had admitted his own liability to pay the suit amount to the plaintiffs as well as that of the other defendants and had undertaken to do so within a period of three months after sale of their factory. Learned counsel has further submitted that as per Annexure "A/8", dated 30-9-1995 to the counter-affidavit to this application which had been signed by defendant No,2 an amount of Rs,14,52,126 was admitted as being owed to the plaintiff No,1 which is contrary to the admission made in Annexure "D/1" to the plaint and admitted to earlier which per the learned counsel is a mala fide attempt by the defendants to get out of their liability in the suit amount which was admitted earlier on 28-9-1995. In support of his contentions learned counsel has relied upon the following case-law:--
(1) Frontier Bank v. A.L. Lallia Ram and others PLD 1953 Lah. 117 at pp.123, 124 and 125,; (2) East Pakistan Provincial Cooperative Bank v. E.F.U. PLD 1957 Dacca 558, (3) Mohammadi Re-rolling Mills v.
4. Shamuddin Ali Boy 1981 CLC 430, (4) H.B.L. v. Ahmed Abdul Ghani Textile Mills 1982 CLC 936-11, (5)
5. U.B.L. v. Muhammad Luqman Muhammad Hanif 1987 CLC 2541, (6) H.B.L. v. Shalimar Silk Mills Ltd.
6. 1993 CLC 1295, (7) Hamidullah Khan v. Muhammad Nawaz Qasuri PLD 1982 Lah. 203, (8) Ghulam Muhammad v. Naseeruddin 1988 MLD 2679, (9) Darab Shah Dalal v. Premier Bank Ltd. 1976 SCMR 67.
7. ' In reply Mr. Arshad Tayyebally, has again reiterated that as the company viz. Messrs Golden Mats (Pvt.) Ltd. Has not been made a party ' to the suit and as the defendants which have been sued in their private capacity are in fact Directors/Share-holders of the company, the suit itself is not maintainable as the cheques in question were issued for and on behalf of Messrs Golden Mats (Pvt.) Ltd. He has again submitted that as regards 13 cheques viz. Annexures "B/5/1" to "B/5/17" which were issued in the name of Messrs Sana International and Messrs Farhat International, the plaintiffs have not been able to show as to how they are the holders in due course of these cheques and consequently the suit as regards these cheques is, in any event, not maintainable under the Summary Chapter. Finally learned counsel has submitted that if at all as the cheques in question were signed by the defendant No,2, therefore, the suit could only proceed against him under the Summary Chapter whereas it should proceed against the other defendants as an ordinary suit. In support of his contentions he has relied upon the following case-law:--
(1) National Security Insurance Co. v. Hoechst Pak. Ltd. 1992 SCMR 718 and (2) Noor Muhammad v.
8. Muhammad Shafi 1986 CLC 2212.
9. ' I have heard learned counsel. It would be seen that the main defence put up by the defendants is the non-maintainability of the suit against them in their personal capacity inasmuch as the cheques in question were issued for and on behalf of Messrs Golden Mats (Pvt.) Ltd. In whose absence, therefore. The suit could not proceed as this company was a necessary and proper party.
10. As regards Annexure "D/1" to the plaint which is an order of the learned District Magistrate, Karachi South, dated 28-9-1995 and which has not been denied by the defendants in their personal capacity the interpretation sought by Mr. Arshad Tayebally on the same is that as it is only directed against the company and consequently the acknowledgement/admission of liability to plaintiff No,1 therein could not be laid at the defendants door. The defendants have also categorically denied that they owed any sums at all to the plaintiff and also that any goods have been supplied by the defendants to the plaintiffs as the plaintiffs only had a business relationship with the companies in question. Consequently, private of contract has been denied in between the parties.
11. ' In my opinion, however, where once the defendant No,2 has categorically admitted before the District Magistrate, Karachi South that he owed the amount claimed in the suit to the plaintiff No,1 defendant No,2 cannot be heard to say anything to the contrary at this stage so as to non-suit the plaintiffs. No other interpretation is possible with regard to Annexure "D/1" viz. The order of the District Magistrate, Karachi South, and dated 28-9-1995. Learned counsel for the defendants has emphasized upon me that if at all this document should only be read so as to establish the liability of the company. However, as adverted to above, upon a plain reading, the conclusion is inescapable that defendant No,2 has admitted his personal liability in the amount of Rs,5.2 million to the plaintiff No,1 vide said order.
12. ' As regards the issue of limitation it would be seen that under Article 64-A of the Limitation Act the period prescribed for filing of a suit based on a negotiable instrument is three years to begin from the date of money became due, when the cause of action would first accrue to the plaintiff. It is an admitted position that the cheques in question were issued in June and July, 1995 and notice of dishonour was sent by the Banks on 8-8-1995. Hence in my opinion the period of three, years would begin from this date and would expire on 7-8-1998. However, vide order, dated 28-9-1995 Annexure "D/1" to the plaint (which is a consent order and has not been denied by defendant No,2) defendant No,2 undertook to pay the agreed amount of Rs,5.2 million to the plaintiff No,1 within three months viz. By 28-12-1995 which gave the plaintiff a fresh cause of action. Hence the period of three years would begin from that date. Consequently, the suit which was filed on 26-12-1998 is within time.
13. In view of the foregoing discussion in my view, the defendant No,2 has not been able to raise any tribal issue which would merit a detailed hearing in the matter as regards the amount of the cheese given to plaintiff No,1 are concerned viz. Annexures "C/1" to "C/29" under his signature which comes to Rs,4,010,439. Consequently, the suit is decreed in this sum against defendant No,2 along with mark-up to 6% per nanny on this amount from the date of filing of the suit till payment.
14. ' As regards the cheese executed by defendant No,2 copies of which have been filed as Annexures "B/5/1" to "B-17" and which are in the total amount of Rs,1,269,500, a tribal issue has been raised inasmuch as the nexus between the plaintiffs and Messrs Sana International and Messrs Farhat International has yet to be established which would thereafter enable the plaintiffs to become holders in due course of these cheques. Hence defendant No,2 is given unconditional leave to defend the suit as far as the claim of Rs,1,269,500 is concerned.
15. As regards defendants Nos.1 and 3 it would be seen that they have neither admitted their liability in the suit amount nor issued the cheques under their own signatures. Nonetheless they are admittedly the Directors and Share-holders of Messrs Golden Mats (Pvt.) Ltd., and as far as their case is concerned, it is yet to be seen whether they would be liable for the dishonored cheques issued by the said company. Consequently, defendants Nos.1 and 3 are given unconditional leave to defend the suit. Inasmuch as their liability under the cheques can only be established in their capacity as Director/Shareholders of the said company, it would be a necessary and a proper party and it is accordingly joined as defendant No,4. Amended plaint to be filed within two weeks whereafter written statements to be filed within two more weeks.
16. Application stands disposed of.