1993 PLP 1137 (SCMR)

SALEEM AKHTAR, J.‑‑‑The appellants by the leave of this Court have challenged the judgment passed by the learned Judges of the Division Bench of the High Court in High Court Appeal No.63 of 1982 whereby the judgment and decree passed by the learned Single Judge in the suit filed by the respondent was affirmed.

2. The brief facts are that on 10‑4‑1971 the Eastern Federal Union Insurance Company entered into an agreement with the appellants at Karachi (hereinafter referred to as the first agreement). On 12‑5‑1971 the appellants entered into an agreement (hereinafter referred to as the second agreement) with Muslim Insurance Company Ltd. at Lahore. Under the first agreement the Eastern Federal Union Insurance Company had underwritten 50,000 shares of Rs.10 each in appellant No.4 company, which was floated as a public limited company. Likewise, under the second agreement the Muslim Insurance Company had underwritten 35,000 shares of Rs.10 each of appellant No.4 company. Under the said two agreements, appellants Nos.1 to 3 undertook to ensure the payment of the guaranteed amount of annual dividend failing which they had to pay the subscribed amount and interest. On 18‑3‑1972 the Life Insurance (Nationalization) Order, 1972 (President's Order No.10 of 1972) was promulgated and published in the Gazette of Pakistan (Extraordinary) on 20‑3‑1972. By virtue of this Order the life insurance business in Pakistan was nationalized and all the assets, liabilities, obligations and contracts of various insurance companies stood vested in the respondent. By Article 4 of the Order the management of the insurers transacting life insurance business in so far as the management related to such business vested in the Central Government. Under Article 5 the trustees were appointed for management of affairs of such insurance business of the insurers. Such trustees were authorised under Article 6 to take possession of all the assets of the insurers in so far as they related to life insurance business. Under Article 11 Life Insurance Corporation was established with effect from the dale appointed by the Central Government by notification in the official Gazette. Such notification was published in the Gazette of Pakistan (Extraordinary), Part II on 17‑10‑1972 and the Corporation was constituted with effect from 1‑11‑1972 for the purposes of carrying on life insurance business having its place of business at Karachi. Under Article 15 all the assets and liabilities appertaining to the life insurance business in Pakistan of all insurers were transferred to and vested in the Corporation.

3. As appellant No.4 did not pay annual dividends in terms of the above two agreements, the respondent filed a suit against the appellants for recovery of Rs.12,29,340.95 and interest and also .for consequential reliefs. The appellants denied the claim and three issues, namely, the locus standi of the respondent to file the suit, the jurisdiction of the Court, and the relief were framed and both the parties made statement that they did not want to lead any evidence. The learned Single Judge during arguments noticed a letter dated 24‑9‑1977 of appellant No.1, a Director of the Company addressed to the Chairman of the respondent‑Corporation and holding that it amounted to admission of liability, granted a decree. The appellants filed High Court Appeal, which was dismissed by the impugned judgment.

4. Leave was granted to consider the questions, whether the shares in dispute/agreements were concerned with life insurance business to be effected by nationalization of the business and as the parties had declined to lead any evidence, could reliance be placed by the Court on document dated 24‑9‑1977 and it alone could be made basis of the decision.

5. Mr. Hafiz Lakho, the learned counsel for the appellants contended that document dated 24‑9‑1977 was neither admitted nor produced and exhibited and therefore no reliance could be placed upon it. It is an admitted position that this letter was filed by the appellants and the same was on record. Although admission and denial of documents had not taken place, the learned Single Judge during arguments noticed this letter and confronted it with the Advocate for the appellants, who admitted it to be genuine and correct. This is reflected from the Court diary dated 26‑4‑1982, which, reads as follows:‑‑ "The case is fixed for arguments today. I have heard arguments at some length of the learned counsel of the parties. I find that in the written statement a stand is taken which is quite contradictory to the admissions made by defendant No.1. Mien Tajammul Hussain in his letter dated 24‑9‑1977 addressed to the Chairman of the plaintiff- Corporation, Mr. Sohail Muzaffar does not deny the genuineness of this letter. The case is adjourned to 29‑4‑1982 on which date defendant No.1 will be present in person at 8‑30 a.m. Further arguments will be heard on that date:' From the subsequent order-sheet it seems that appellant No.1 did not appear in Court and avoided the hearing. The learned Judge thereafter on the basis of this letter passed the decree. The objection raised by the learned counsel for the appellants is a hypertechnical one. The learned counsel for the appellants had admitted the document which had been filed alongwith the written statement. After being admitted the fact that it was not exhibited does not exclude the document from taking it into consideration. The learned counsel for the appellants had not challenged the genuineness of the document, but a admitted. it to be genuine and correct. In such circumstances, if the exhibit number was not put on the document it will not make it inadmissible particularly when the parties orally produced no evidence. Thus, admitting the document in evidence or relying upon it was not an illegality which may vitiate the judgment and decree passed by the learned Single Judge and confirmed by the impugned judgment.

6. Now coming to the contents of letter dated 24‑9‑1977 both the Courts have held that the appellants admitted the factum of the transfer of the two agreements to the respondent and also acknowledged their liability and requested for withdrawing legal proceedings by assuring that their shares would yield reasonable return. This letter was written during the pendency of the suit and has not been marked as without prejudice. It clearly admits the transfer of agreement and the liability incurred under it.. The decree was therefore passed on proper appreciation of the letter.

7. The learned counsel for the appellants contended that the agreements were not part of the life insurance business and therefore it could not be vested in the respondent and thus the admission made was in ignorance of law and facts. On the other hand Mr. Mansoor Ahmad Khan, the learned counsel for the respondent has referred to various provisions of the Order to substantiate that the agreements vested in the respondent and at no stage even both the insurance companies had disputed this fact. In such circumstances, and the admission made by the appellants, this ground is not available to them. The appeal is therefore dismissed with no order as to costs. AA./T‑86/S Appeal dismissed.