P L D 1969 Quetta 53 (PLP)

K. E. CHAUHAN, J.

‑ Haji Mir Qadir Bakhsh (defendant No. 1) (hereinafter called the maker) executed a promissory note on 24‑7‑1961 for Rs. 2,48,889.00 in favour of Mst. Fatima Gul (defendant No. 2) (hereinafter called the payee). She is wife of Agha Ghulam Ali Khan who is defendant No. 3 in the case. Mst. Fatima Gul (defendant No. 2), then by means of an endorse ment dated 26‑8‑1963, negotiated the said instrument in favour of the plaintiff Ch. Imdad Ali. It is further to be mentioned that at the time of the aforesaid endorsement, Agha Ghulam Ali Khan (defendant No. 3, husband of defendant No. 2 Mst. Fatima Gul), executed a surety bond to re‑imburse the plaintiff in case of the failure of defendant No. 1 (the maker of the promissory‑note) to honour the instrument.

2. Plaintiff on 27‑8‑1963, issued a notice to defendant No. 1 informing of the transfer of the instrument in his favour. Defendant No. 1 on 31‑8‑1963, sent a reply contending that the amount of the pronote had already been paid up by him to Mst. Fatima Gul defendant No. 2 and in this way nothing was due on the pronote. Not being satisfied with this reply, the plaintiff then presented the promissory‑note through a Notary Public to the maker of the instrument. The maker of the promissory‑note (defendant No.1) did not honour the pronote and this time denied even its execution. The plaintiff then filed the present suit in which he impleaded Haji Mir Qadir Bakhsh (the maker of the promissory‑note) as defendant No. 1 ; Mst. Fatima Gul, the payee of the promissory‑note, as defen dant No. 2 and Ghulam Ali, husband of Mst. Fatima Gul, who had stood surety for the amount of the promissory‑note, as defendant No.

3. The suit was instituted in the Court of the District Judge, Quetta, and in the last paragraph of the plaint it was stated :‑ "It is prayed that decree and orders for the sum in suit may kindly be passed in favour of the plaintiff and against the defendants jointly and severally with costs." The suit was instituted first in the Court of the Senior Civil Judge, Quetta, but was at a later stage transferred to the Court of the District Judge, Quetta.

3. Defendant No. 1 filed a written‑statement in which a preliminary objection was raised that the promissory‑note was not properly stamped and cancelled and would be inadmissible in evidence. On merits, the execution of the promissory‑note was denied as also the consideration for the same. Defendants Nos. 2 and 3, namely, the wife and her husband filed a joint written‑statement, in which they averred that the pronote was a genuine document which was executed by defendant No. 1 in favour of defendant No. 2 for full consideration. It was further admitted that she had transferred this pronote in favour of the plaintiff et Quetta, after receiving the full consideration and that her husband defendant No. 2 had stood surety to re‑imburse the plaintiff. The written‑statement further stated that, the defendant No. 3, admits surety‑bond to be correct and binding upon him." On merits, it was pleaded by them that the maker of the promissory‑note had not made any payment to its payee, namely, defendant No. 2, and that the promissory‑note had been validly transferred to the plaintiff, who is entitled to recover the amount in suit. In Para. 5 of the written‑statement it was admitted that "the answering defendants had been joined properly as parties to the suit." In the end, however, the said defendants pleaded that the decree should be rassed in favour of the plaintiff against defendant No. 1 alone. The following issues were then framed in the case, after the matter on this point had been decided by our learned brother Qadeer ud‑Din Ahmad, J., in Revision Application No. 7 of 1964 on 15‑2‑1965. (1) Has the plaintiff contravened the provisions of Order VII, rule 14 and Order XI, rule 3, C. P. C. ? (2) Is the pronote in dispute properly stamped ?" (3) Is the pronote in dispute executed and endorsed by defendant No. 1, or is it a forged document ? (The burden to prove the first part of this issue was put on the plaintiff and the burden to prove the second part of it was put on the defendant. But it was directed that evidence on both parts will be led simultaneously ; because the two parts being contradictory in the event of one of them being established, the other part will be automatically disproved. It was further directed that the evidence was to be produced first by the plaintiff). (4) Whether the pronote in dispute is without consideration ? (5) If the pronote was endorsed by defendant No. 2, in favour of the plaintiff, then was defendant No. 3, to be surety for defendant No. 2?"

4. The plaintiff examined five witnesses in the case. P. W. 1 was Sultan Muhammad Stamp Clerk, Treasury Office, Quetta. He stated that he was working on his present post since 1951. He said that there was no adhesive stamp of 50 paisas in their stock. Stamp of the said denomination, it was deposed by him, was neither sold nor issued by the Government to them. If 50 paisas stamp was not available. in its place were used two stamps worth 25 paisas each or four stamps of two annas each. In cross‑examination, he admitted that stamps of the denomination of annas two and four were being received in stock and the same were being issued to the Postal Depart ment or were being used. P. W. 2 was Agha Ghulam Ali (defendant No. 3) (husband of defendant No. 2). He proved the execution of the pronote which was marked "A" to the case. He further proved the endorsement of his wife in favour of the plaintiff and the receipt of consideration by her for this purpose. He admitted that he had executed a surety bond dated 26‑8‑1963 (Exh. P. 1). He was shown the (Joint) written statement dated 18‑10‑1963, filed by him in the case which he accepted as correct. P. W. 3 was Dr. Muhammad Khair‑ud Din, Notary Public, Quetta. He deposed about the presentment of the promissory‑note to defendant No. 1 at the instance of the plaintiff and the refusal of the said defendant to honour the same and his denial of its very execution or genuineness of endorsement in plaintiff's favour. He proved Exh. P. 2, the customary protest entered by him at the time of the presentment aforesaid. P. W. 4 was Sardar Ali Beg Petition‑Writer. He proved the execution of the promissory‑note and its stamping by him. He corroborated his statement by saying that entry about its execution had been made by him in his register, copy of which he produced as Exh. P.

3. P. W. 5 was Muhammad Ali another Petition‑Writer of Quetta, who proved the endorsement made by defendant No. 2 in favour of the plaintiff and corroborated it by producing corresponding entry of this matter from his register in the form of Exh. P.4. These are the proceedings, which happened up to 31‑3‑1965. At this stage, the case took another turn. On an application or applications filed by the contesting defendants, the trial Court by its order, dated the 5th of April 1965, repeated on 14‑7‑1965, held that it will try the preliminary issue No. 2 about stamping of the promissory‑note first. After hearing arguments on issue No. 2, the learned District Judge held that the pronote was insufficiently stamped and was thus inadmissible in evidence. Taking the view that the pronote constituted the basis of the suit, he further held that since it could not be produced in evidence, the plaintiff could not fall back on any other or original cause of action which, according to him, could not be proved independent of the pronote. In the light of his finding aforesaid, he dismissed the suit of the plaintiff with costs by means of his judgment and decree dated the 18th of August 1965. The ground on which the promissory‑note was held to be insufficiently stamped was that according to new Coinage System, the pronote was to bear a stamp of 50 paisas, whereas, according to the learned District Judge, it had been stamped with four (old) adhesive stamps of two annas each which, according to Decimal Coinage was individually worth 12 paisas each, with the result that the total amount for which the stamps axed were worth, came only to be 48 paisas thus making it short by 2 paisas. The plaintiff has come up in appeal against the judgment and decree of the learned District Judge to this Court.

5. The first point to be seen is as to whether the promissory note in this case was insufficiently stamped. It is common‑ground, that the pronote required as per Article 49 of the Schedule attached to the Stamp Act, adhesive stamp worth annas eight according to the Coinage Act III of 1906 (as it stood prior to its Amendment on 19‑7‑1960). Prior to this date, the system of coinage consisted of rupee, annas, pice and pies. One rupee consisted of sixteen annas or sixty‑four piece or .192 pies.. This system ,was changed with what is now known as "Decimal Coinage" by the Pakistan Coinage Act (Amendment) Ordinance XXXI of 1960 with effect from 19‑7‑1960. By this Ordinance there was inserted a new heading and a new section 15‑B in the Pakistan Coinage Act III of 1906. This new heading and section read as follows :‑ "Decimal Coinage 15‑B. (1) The rupee shall be divided into one hundred units and the new coin representing such unit may be designated by the Central Government by notification in the official Gazette under such name as it thinks fit, and the rupee, half‑rupee and quarter‑rupee shall respectively be equivalent to one hundred, fifty and twenty‑five such new coins and shall, s0ject to the provisions of subsection (1) and subsection (2) of section 13, and to the extent specified therein, be legal tender in payment or on account accordingly. (2) All coins issued under the authority of this Act in the denominations of annas, pice and pies shall, to the extent specified in section 13, be legal tender in payment or on account at the rate of sixteen annas, sixty‑four pice or one hundred and ninety‑two pies to one hundered new coins referred to in subsection (1), calculated in respect of any such single coin or number of such coins, tendered at one transaction, to the nearest new coin, or where the new coinabove ,end the new coin below are equally near, to the new coin Wow, (3) All references in any enactment or in any notification, rule or order under any enactment, or in any contract, deed or other instrument, to any value expressed in annas, piece and pies shall be construed as references to that value expresses in new coins referred to in subsection (1) converted thereto at the rate specified in subsection (2)." The obvious effect of this new law was that the reference in Article 49 of the Schedule of the Stamp Act to "eight annas" was to be construed as reference to the value expressed in new coins referred to in subsection (1) converted thereto at the rate specified in subsection (2) of section 15‑B ibid. In this way, reference to eight annas, subject to the discussion to follow hereafter, was to be construed as reference to 50 paisas. This meant that a promissory‑note which required a stamp of eight annas previously was now to be affixed with stamp worth 50 paisas.

6. In rule 13 (f) of the Pakistan Stamp Rules, 1925, it is laid down that instruments chargeable with stamp duty under Article 49 (a) (if) and (iii) may be stamped with adhesive stamps. Promissory‑note of the kind involved in this case falls under this Rule. In rule 16, it is laid down that :‑‑ "Except as otherwise provided by these rules, the adhesive stamps used to denote duty shall be the requisite number of stamps,‑ (i) bearing the words 'Four Annas' or `Two Annas' or `One Anna' of `Half Anna' and (ii) (a) (b) " These Rules, as laid down in section 76 (2) of the Stamp Act, shall have effect as if enacted by the Stamp Act. According to rule 16, a person can stamp a promissory‑note with four or two annas stamps. This is a right given by the Statute. The Coinage Act has not taken away nor touched this right. The person concerned in the instant case was, therefore, justified in affixing four two annas stamps on the pronote. Secondly, the exact converted value of the old two annas coin, according to Decimal Coinage is 12.50 new paisas. If four stamps of two annas denomi nation are, therefore, put on a promissory‑note, the total value will be 50 paisas and not 48 paisas. That this is so, is clear from subsection (2) of section 15‑B of the Coinage Act, where it is written that when a number of old coins are tendered at one transaction, then their new value is to be fixed at the nearest new coin. There is thus a difference, when only one old coin is tendered and when more than one coins are tendered at one transaction. If only one old coin is tendered, its corresponding value may be less, as for example if anybody tendered an old two annas coin, it will be equivalent to new twelve paisas only and the fraction of '50 (point fifty) Paisas will be ignored. This is so : because the new correspond ing value 12.50 paisas is such which is equi distance from figures 13 and

12. The figure 13 is ‑50 (point fifty) paisas above while figure 12 is '50 (point fifty) paisa below, the exact corresponding value 12.50. In such a case, as laid down in the aforesaid subsection it will be the new coin below, which will be the corresponding new value that is 12 new paisas for an individual piece of old two annas coin. But when four such coins are tendered at one transaction, they shall be all taken together and their total value thus represented will be their new value. In this way, the fraction of 50 (point fifty) paisa which was ignored in an individual coin in the example hereinbefore given, will not be ignored and rather will be added towards the consequent new coin. Looked at in this prospective, the learned District Judge was not justified in assessing the value of the stamps affixed on their individual value. He should have taken the collective value of the four stamps of two annas denomination each. The learned District Judge did not take into consideration subsection (2) of section 15‑B of the Coinage Act and, especially, the phrase "tendered at one transaction", occurring therein due to which the mistake crept' in his order under appeal.

7. The next mistake committed by the learned District Judge was that he did not keep in view subsection (3) of sec tion 15‑B of the Coinage Act, which has already been reproduced above and which stated that, "all references in any enactment or in any notification, rule or order under any enactment, or in any contract, deed or other instrument, to any value expressed in annas, pice and pies shall be construed as references to that value expressed in new coins referred to in subsection (1) converted thereto at the rate specified in subsection (2)." The effect of this provision of law is that rule 16 of the Stamp Rules ibid, which stated that stamps of the value of two annas could be used for affixing stamp on a promissory note, meant in the new context, that the value of these stamps will be converted at the rate specified in subsection (2), i.e. in accordance with the principle meant for tendering at one transaction.

8. The upshot of the above discussion is that the promissory‑note in the instant case was sufficiently stamped and could not be refused to be admitted in evidence or acted' upon under section 35 of the Stamp Act. The result is that the judgment and decree of the learned District Judge, Quetta, which are based on this aspect of the case, shall have to be set aside. Since we have held the promissory‑note to be sufficiently stamped and admissible in evidence, we need not go into the other aspects of the case, namely, whether the plaintiff can sue on the original cause of action, if the promissory‑note falls through for want of stamp ; because that contingency in view of our finding herein is not arising and we reserve our views on that point to be laid down in some appropriate case.

9. The appeal is accepted with costs throughout and the judgment and decree of the learned District Judge, Quetta, are set aside and the suit is remanded to him further trial in accor dance with law. Appeal accepted. Case remanded.