2010 PLP 1795 (CLD)

FAISAL ARAB, J.

The plaintiff has filed this suit for damages as it is claimed that the defendant has committed breach of contract and has also misappropriated the pledged stocks. The claim of the plaintiff was denied by the defendant/Bank in its written statement. Following issues were framed: (1) Whether the suit has been filed unauthorisedly and is liable to be rejected? (2) Whether the suit as framed is not maintainable? (3) Whether the suit has been filed without any cause of action and is liable to be dismissed? (4) Whether the defendant declined the TR facility after the execution of PRO-NOTE, fully secured and committed breach of contract, as also duly substantiated by Official Assignee Report? (5) Whether the defendant committed any breach of contract and/or trust due to which the plaintiff suffered astronomical financial losses, bad reputation, cancellation of international orders and mental distress? (6) Whether the plaintiffs factory remained closed due to any illegal action of the defendant and during the period the plaintiff incurred expenses? (7) Whether the defendant violated the terms of contract AAM/3/84 which caused losses/damages to the plaintiff? (8) Whether the plaintiff is entitled for recovery of damages dollars 17,521,675 and /or any part thereof? (9) What should the decree be?

2. The parties adduced their respective evidence. At the time of the arguments, learned counsel for the plaintiff confined himself only to the claim with regard to the shortage of stocks. He contended that from the Official Assignee's report dated 30-11-1991, it has admittedly come on record that 151 pieces of VCPs were found to be short from the pledged stocks. He submits that value of each unit of VCP at that time was US 250 thus making altogether a claim of US 37,

750. He relied upon cases reported in 1988 CLC 1396 and 2005 CLD 1067, wherein it has been held that where goods belonging to the borrower are pledged with the bank and pledged stocks under the watch of the bank were subsequently found missing then it was for the bank to make good the loss that has occurred on account of any shortages. Learned counsel for the defendant/Bank in reply argued that the plaintiff has based its claim on shortage of inventory which he claims is evinced from Exh.P/3 to P/9. While referring to Exh.P/3 and P/4 which is one and same document, he states that it is mentioned in Official Assignee's report that on account of bank's letter dated' 14-4-1985 shortage of 151 pieces has been establish but he states that this letter dated 14-4-1985 was never exhibited in the evidence and therefore, the plaintiff failed to establish that there was any shortage of inventory. He also referred to Exh.P/7 and P/8 wherein there is no finding of Official Assignee that there was shortage of 151 pieces. He argued that entire case of the plaintiff is that record of the defendant bank reflects that shortage has accrued but none of these documents was produced in evidence to establish shortage. He has also referred to cross-examination of the plaintiffs witness at pages 155 to 157 of the evidence file wherein witness was unable to establish that there was shortage in the inventory lying under the pledge of the defendant/Bank.

3. There is no cavil to the legal proposition laid down in the judgments cited by learned counsel for the plaintiff that where stocks pledged with the bank are found to be missing or damaged then the liability solely lies on the bank to compensate the borrower. However in order to make bank liable for any shortage, the burden is on the plaintiff to establish that there actually was any shortage. The plaintiff though has a right to seek documents in the custody of the bank in order to establish that there was shortage of pledged stocks but neither letter dated 14-4-1985 which was referred in Official Assignee's report was produced though it was with the plaintiff nor relevant record of the defendant/Bank was sought from the bank in order to establish any shortage in the pledged stocks. Hence there was no evidence on record from which it could be established that there was any shortage of the inventory that was given under the care of the defendant. No order point was raised on any other issue by the plaintiffs counsel. In the circumstances, the suit of the plaintiff fails which is dismissed with no order as to costs. H.B.T./M-103/K Suit dismissed.