1986 PLP 2607 (CLC)

(b) Export Guarantee Insurance Scheme Rules, 1962‑‑ ‑‑‑S. 9‑‑Trial Court is not empowered to decree suit beyond 75$ of commercial risk involved in suit and Court could allow interest on amount only from date of institution of suit till payment of amount and not prior to institution of suit. Abdul Rauf for Appellant. Amanullah Khan for Respondent. Date of hearing: 3rd March, 1986. This second appeal under section 100, C.P. C. is filed by the appellant /defendant against the two concurrent judgment of the Court below. The following facts in brief may be stated here: The respondent instituted Suit No.1092/75 for recovery of a sum of Rs.28,650 before the Civil Judge, Karachi on the allegation that the respondent who had executed a guarantee /insurance policy under the Export Credit Guarantee Insurance Scheme Rules, 1962 is liable to reimburse that amount to the plaintiff /respondent on account of failure of the buyer to remit back a sum of Rs.28,650 equivalent to L.1000 in connection with the export of two Pakistani films to Messrs G.J. Sales (London). The suit was resisted by the appellant but it was decreed as prayed by the trial Court with interest at 9% from 22nd November, 1972 and until recovery of the amount. It is clear from the plaint that the respondent /plaintiff had claimed interest on the decretal amount at the rate of 6% per annum from the date of filing of the suit until the amount is paid but it is not known on what reasoning the interest was granted by the trial Court from the date prior to institution of the suit. The first appellate Court also confirmed the decree of the trial Court. The learned counsel for the appellant contended before me that the amount claimed by the respondent in the suit was not covered under the terms of the insurance policy /guarantee furnished by the appellant under Export Credits Guarantee Scheme Rules, 1962 and, therefore, the Courts below should have rejected the claim outright on that ground. Alternatively, it is contended by the learned counsel that the claim of the respondent /plaintiff being in excess of Rule 9 of Export Credits Guarantee Scheme Rules, 1962 the Court should not have allowed the access amount claimed by the plaintiff /respondent in the suit. None of the two contentions raised by the learned counsel before me appears to have been raised before the trial Court or before the first appellate Court and, therefore, in so far that first contention is concerned it cannot be entertained in the second appeal for the first time. However, alternate contention raised by the learned counsel for the appellant is purely a question of interpretation of Rule 9 of the Export Credits Guarantee Insurance Scheme Rules, 1962 and in this connection no factual aspect of the case is required to be examined. I am, therefore, inclined to examine the second alternate contention of the appellant in this appeal. Rule 9 of the Insurance Scheme referred to above is as follows: "

9. Percentage of loss payable.‑ The Corporation shall pay, under the Scheme, 75 per cent of the losses on account of the commercial risks and 85 per cent of the losses on account of the political risks, enumerated in sub‑rule (1) and 85 per cent of the losses on account of the cause of loss stated in sub‑rule (2) of rule 6." A similar provision also appears in document Exhibit P‑4 which is a guarantee extcuted by the respondent in respect of the export of two films by the appellant and paragraph 8 of the terms and conditions of the guarantee are in the same terms as are provided in rule 9 of the Scheme. This document Exh.P.4 was produced by the plaintiff /respondent in evidence and was part of the record of the trial Court. In view of clear provision contained in rule 9 reproduced above and the provision of paragraph 8 of the guarantee the trial Court could not have decreed the suit beyond 75% of the commercial risks involved in the suit. According to the allegation in the plaint the total commercial value of the consignment was Rs.28,650 equivalent to .1000 and, therefore, the trial Court should have decreed the suit only to the extent of 75% of this amount which comes to Rs.21,

470. The trial Court should also have allowed the interest only from the date of institution ‑of the suit till the amount is paid as there is no stipulation in the guarantee Exh.P.4 providing for payment of interest on the amount. I accordingly accept this second appeal and modify the judgment and decree of the Courts below to the extent that the amount decreed shall be reduced to Rs.21,470 with proportionate costs and interest will be payable at the rate of 6% per annum from the date of filing of the suit till the dash amount is paid. The costs of this appeal shall also be borne by the appellant. H . B . T . Appeal partly accepted.