P L D 1965 (W (PLP)

I will now deal with the objections raised on behalf of the plaintiff. He had despatched 630 bales of cotton to Karachi for sale by defendant No. 1 as commission agent. Its details are shown in para 3 of the report submitted by the commissioner. It shows that all these bales were despatched under 7 invoices and these were sold by defendant No. 1 at different times. Plaintiff has raised objections in respect of these invoices separately and hence I will also deal with these objections accordingly as it would be more convenient and proper. Invoices Nos. 1 and

2. Each invoice covered 100 bales of cotton which had arrived at Karachi on 29‑1‑

51. There is no dispute about this point, The case of defendant No. 1 is that these 200 bales of cotton were sold by him on 19‑1‑51 and these goods were shipped to Hongkong on 3‑2‑

51. Its further case is that this cotton was sold to Intercontinental Cotton and Textile Mills at the rate of Rs. 117 per maund. Entries in Stock book of defendant No. 1 in respect of these transactions are Exhs. D‑1/10 and D‑1/11. These transactions were reported in the Pakistan Cotton Association Report dated (Exh. D‑1/20) and the relevant entry is Exh. D‑1/19, while the bill Exh. D‑1/22 is dated 14‑2‑

51. Objections of the plaintiff in respect of these transactions are that defendant No. 1 had to sell cotton with his permission, that defendant No. 1 without his permission had purchased this cotton for himself, that this transaction had actually taken place not on 19‑1‑51 as the goods had arrived at Karachi on 29‑1‑51 and, lastly that the rate of cotton on 14‑2‑51 when the bill Exh. D‑1/22 was issued by defendant was Rs. 141 per md. It is correct that Muhammad Bashir (Exh. 48) a partner in defendant's firm) has admitted that the rate of cotton on 4‑2‑51 was Rs. 141 per md. Elaborating his arguments, it was urged on behalf of the plaintiff that the Commissioner has not considered the plaintiffs evidence on record but he has taken one sided view of the case. It was further urged on his behalf that the Commissioner had failed to consider that there was collusion between the defendants who are related inter se and had also failed to consider the interest of both the defendants, and, lastly that the evidence adduced by defendant No. 1 was inconsistent and beyond the pleas raised by him in his written statement. The commissioner should have considered the evidence of defendant No. 2 with more caution as he was supporting defendant No.

1. He had further added that the Commissioner should have discarded and not placed reliance upon Exhs. D‑7/1 to D‑7/8 because these were produced by defendant No. 2 at a very late stage. According to him letter Exh. D‑7/3 upon which great reliance was placed by the Commissioner in his report was not in the hand writing of the plaintiff and it had been proved to be so. His objection as already stated by him is that the goods were not sold on 19‑1‑51 and further that .no consent of the plaintiff had been obtained for its sale by defendant No.

1. His further case is that defendants Nos. 1 and 2 had not produced their accounts books in Court and no reliance should have been placed upon such documents as these are false. His next argument is that the Commissioner had erred in not holding that defendant No. 1 had purchased these goods secretly and without notice to plaintiff and for this purpose he should not have relied upon the contradictory statements of 1qbal Hussain and the reasons given by the Commissioner are not satisfactory. As these sales were not reported in the Karachi Cotton Association Reports, no reliance should have been placed by the Commissioner on such reports in Pakistan Cotton Association. In view of all these reasons the case of the plaintiff is that actual sale of these goods took place after 19‑1‑51 as the amount was credited on 14‑2‑51 i.e. after about 27 days. It is correct that defendant No. 2 has denied his partnership with plaintiff in this concern. There is no evidence on record to show when this dispute arose between them. If such dispute had arisen during the pendency of partnership, plaintiff should have dissolved the partnership and when this was not done presumption would be that dispute had arisen between them after this partnership had terminated. In the present suit we are not concerned with the reason of dispute between the plaintiff and defendant No.

2. It has also come on record that defendant No. 2 is related to defendant No.

1. It is admitted by Muhammad Bashir Exh. 8 that defendant No. 2 is his brother‑in‑law as well as his cousin. I have also referred to the fact that both these defen dants were represented in this suit by one and the same Advocate. The evidence on record shows (statement of Iqbal Hussain D. W.1) that two of the directors of Messrs Intercontinental Cotton and Textile Mills Ltd., namely Muhammad Bashir and Muhammad Salim are also partners of defendant No.

1. He has further admitted that the purchasers are sister concern of defendant No.

1. Lastly, that the bill Exh. D‑1/22 was prepared in the name of defendant No. 1 instead of intercontinental Cotton and Textile Ltd. and the reason given by Iqbal Hussain is that both these are sister concerns. This fact shows that defendant No. 1 made no secret of this transaction as virtually he himself was purchasing these bales. But the evidence on record shows that plaintiff knew this fact and further that no objection was raised by him. This evidence shows that plaintiff who was at Karachi. to supervise the sales of his cotton was informed orally about this transaction and this information was sent to defendant No. 2 by a telegram Exh. D‑6/1 dated 21‑1‑

51. Plaintiff Habibullah Exh. 25 has stated in Court that these bales of cotton were to be sent to Karachi and I was to dispose them of. He had further stated that these bales were to be sold with his permission. It is also admitted by him in his cross‑examination that he used to visit defendant No. 1 occasionally. He has denied that he was informed about this transaction i.e., defendant No. 1 had purchased these cotton bales for himself. But I find that there is evidence on record to support the case of defendant No.

1. In the first place there is the telegram Exh. D. 6/1 dated 21‑1‑51 sent by defendant No. 1 to defendant No. 2 who was a partner of the plaintiff in this business and it reads as follows : "Sold 200 Katcha Khoh January for Rs.

117. Remit one lac, pay Rs. 88,000 ; Dad Muhammad Khan." Defendant No. 2 has admitted to have received this telegram and has thus supported defendant No.

1. There is a letter Exh. D‑7/3 which was written by plaintiff to defendant No. 2 on 26‑1‑

51. Plaintiff is now dead and accordingly his son Muhammad Bashir was confronted with it. He admitted that the letter Exh. D‑7/3 was in the hand writing of his father. During his cross‑examination he tried to get out of this position and stated that although the handwriting of Exh. D‑7/3 resembled to his father's writing but there was some difference in his signature. But defendant No. 2 has stated before the Commissioner on oath that Exh. D‑7/3 is in the hand writing of the plaintiff and also was signed by him as he was conversant with his handwriting. The relevant portion in this letter reads as follows : " . . . . . You have already been informed by Muhammad Bashir (a partner of defendant No. 1) perhaps reference is to telegram Exh. D‑6/1) that 200 bales of Kutcha Khoh were sold at Rs. 117 although the market rate had also become Rs. 118 and Rs. 118‑8‑

0. I have asked him for the sale and transaction of more but it has not been done as yet. Yesterday the market had gone down. Yesterday's news was Rs. 116 . . . . ." Plaintiff's objection is that why oral intimation was given to him when telegram was sent to his partner. I find very little force in this argument as plaintiff was at Karachi in those days to supervise the disposal of his cotton and in this respect reference has already been made to the evidence given by the plaintiff in this Court. For these reasons he was informed orally and it was further admitted by him that he very often visited defendant. As defendant No. 2 was out of Karachi a telegram was sent to him informing him about this transaction and there appears nothing unnatural about it. Cotton sent by other invoices was sold by defendant No. 1 at different times. If the plaintiff was not aware of the disposal of cotton covered by invoices Nos. 1 and 2 I cannot understand why he raised no objection or made no inquiries from defendant No. 1 about the disposal of this cotton specially when he was informed and knew very well about the sale of cotton covered by the remaining invoices. I am therefore, satisfied with all this evidence and the circumstances and hold agreeing with the Commissioner, that plaintiff knew about the transaction of cotton covered by invoices Nos. 1 and 2 and had raised no objection to it as it is evident from letter Exh. D‑7/3 dated 26‑1‑51 addressed by him to his partner (defendant No. 2). There is some delay in production of this letter by defendant No. 2 and his explanation is that he had not produced this letter during his examination‑in‑chief as after it was over he made searches again and found this letter and hence it was produced by him during his re‑examination. I have already shown that there is no doubt about the handwriting and the signature of plaintiff in respect of this letter. Another objection raised by the plaintiff is that this transaction was not reported in Karachi Cotton Association Reports. It is correct that the evidence on record shows that Muhammad Bashir (partner in defendant No. I firm) was President of Pakistan Cotton Associa tion. It has further come on record that he had no control over the report issued by the Pakistan Cotton Association. Thus mere fact that he was the President of this Association at the relevant time would not be sufficient reason to disbelieve such reports. If the plaintiff doubted such reports he could have led evidence to prove that other transactions reported by it were also false. Lastly there is a legal aspect of the case, i.e., whether defendant No. I as commission agent of the plaintiff could purchase this cotton for himself. I will deal with this aspect after discussing the factual aspect in respect of other transactions. For all these reasons I agree with the Commissioner and dismiss the objections raised by the plaintiff in respect of sale of cotton covered by invoices Nos. 1 and

2. Invoices Nos. 3 and 4.‑No objection has been raised by the plaintiff in respect of the disposal of the cotton bales covered by invoice No.

4. As regards the other invoice, i.e., No. 3 his contention is that defendant No. 1 had sold the goods covered by both the invoices Nos. 3 and 4 together in the third week of March 1951 at Rs. 162 per maund. According to him it was not correct and neither it is proved by defendant that he had sold the goods of invoice No. 3 on 5‑7‑51 and in this respect Commissioner had relied too much upon the explanation given by defendant No. 1 and further that there were discrepancies in the account books produced by Firdous Trading Corporation, but these entries were accepted as correct by the Commissioner. It was further urged on his behalf that defendant No. 1 had failed to produce the' best evidence available when Firdous Trading Corporation were not summoned before the Commissioner and as such adverse inference should have been drawn and secondly that entries in the account books of Firdous Trading Corporation should have been discarded. In view of these reasons he has claimed the rate of Rs. 162 per maund in respect of the goods covered by invoice No.

3. No evidence was adduced by the plaintiff in respect of his version before the Commissioner that these goods were sold by defendant No. 1 in the month of March and at the rate of Rs. 162 per maund. He has not examined any purchaser. Nor report from Karachi Cotton Association or Pakistan Cotton Association has been produced to corroborate his case. This objection has been raised, it appears, in view of the fact goods covered by invoice No.

4. In this respect, the case of defendant No. 1 is that he had sold 100 bales covered by invoice No. 4 to Firdous Trading Corporation on 15‑3‑51 at the rate of Rs. 162 per maund. There is sufficient evidence in support of this fact. As the rates were falling down, the purchaser refused to take delivery and ultimately compromise was arrived at between the parties and the same goods were sold to Firdous Trading Corporation on 3‑7‑51 at the rate of Rs. 129 per maund but the plaintiff has been given credit at the rate of Rs. 162 per maund though it has caused loss to defendant No.

1. In respect of goods covered by invoice No. 3 100 bales were sold by defendant No. 1 to same purcaser, namely, M/s. Firdous Trading Corporation two days latter, i.e., on 5‑7‑51 at the rate of Rs. 126 per mound. Reports of Pakistan Cotton Association dated 9‑7‑51 is Exh. D‑1/48 and the entry from it is Exh. D‑1/47 in support of this fact. It is also proved that the market rate on that date ranged between Rs. 120 to Rs. 127 per maund. I agree with the Commissioner that objection has been raised by the plaintiff because the purchaser (M/s. Firdous Trading Corporation) had refused to take delivery in respect of the goods covered by invoice No.

4. Otherwise defendant No. 1 is strongly corroborated by the documentary evidence referred to above and secondly the plaintiff has adduced no evidence in support of his case that the goods covered by invoice No. 3 were sold by defendant No. 1 in March 1951 at the rate of Rs. 162 per maund. Plaintiff had objected to the Commissioner's acceptance of account books produced by Firdous Trading Corporation. In fact plaintiff too had referred to these entries before the Commissioner. There are certain mistakes and these have been satisfactorily explained and I find that sound reasons have been given by the Commissioner in accepting those entries. As there is no material on record to support the contention of the plaintiff in respect of this invoice I dismiss this objection. Invoices Nos. 5 and 6.‑No objection has been raised by plaintiff in respect of the goods covered by these two invoices and sold by defendant No.

1. Invoice No. 7.‑50 bales of cotton covered by this invoice were sold by defendant No. 1 to Faiz and Pirbhai & Co. and there is strong documentary evidence in support of this fact. Objections raised by the plaintiff in this respect are that Commissioner bad relied too much upon Exh. D‑2 regarding the date of transaction viz. 9‑7‑

51. His case is that these goods were sold by defendant No. I in February 1951, and at the rate of Rs. 162 per maund. As nobody was examined on behalf of Faiz and Pirbhai & Co. Commissioner should have raised adverse presumption and should not have relied upon the account books produced by defendant No.

1. There is no evidence on records to support the contention of the plaintiff that these goods were also sold in February 1951. Commissioner was right in accepting the evidence, both documentary and oral adduced by defendant No. 1 and in holding that these goods were sold on 9‑7‑

51. It was stated by Iqbal Hussain (D. W‑1) that the bill in respect of this transaction was handed over to Mahrukh Mirza (an employee of the plaintiff) on 30‑7‑51 and his endorsement by way of receipt is Exh. D‑1/53 which mentions statement of accounts instead of the bill. This mistake is immaterial as this endorsement refers to this transaction. 1f this transaction had really taken place in February 1951, as alleged by the plaintiff, it is not explained why no objection was raised by him regarding the non‑receipt of the bill etc. or that no inquiry was made by him in this connection. I, therefore, find very little force in this objection and accordingly reject it. Late production of documents by, defendant No. l.‑Objection was raised on behalf of the plaintiff that defendant No. 1 had filed affidavit of documents (vide page 61) and the documents were produced very late by him before the Commissioner. There appears very little force in this objection as documents are to be produced by the parties before the Commissioner under Rule 203 of the Chief Court Rules (OS) and its clause 7 lays down that when a case is ready for hearing the Commissioner after examining the parties may require them to produce their oral and documentary evidence on the point asserted by him on which the parties are at dispute. Accordingly this objection also fails. Payments.‑Plaintiff has raised objection in respect of one payment only viz. one lac of rupees. This case has been dealt with by the Commissioner in paragraph 34 of his report. His case is that he had remitted this amount on 9‑5‑51 to Messrs S. M. Illahi & Co. at Multan under the instructions of the plaintiff. Evidence on record further shows that defendant No. 2 owns S. M. Illahi & Co. of Multan. It was argued before the Commissioner on behalf of defendant No. 1 that this payment is binding on the firm. This amount of one lac of rupees was paid by T. T. through Habib Bank Ltd. and the advice of the Bank dated 9‑5‑51 is D‑1 /63. Rs. 33‑12‑0 were charged by the bank as remittance charges and it is mentioned in the advice D‑1/63. Accordingly a sum of Rs. 1,00,033‑12‑0 was debited and relevant entries have been produced. Objections raised by the plaintiff are that plaintiff had erred in holding that this amount was sent to S. M. Ilahi & Co. at his instance because there is collusion between defendants Nos. 1 and 2 who are closely related to each other. It is correct that when plaintiff was examined in Court on 6‑2‑58 he had denied payment of this amount. This denial was made by him in his examination‑in‑chief. On the other hand the case defendant No. 1 is that he had remitted this amount to S. M. Ilahi & Co under instructions of plaintiff and defendant No. 2 is owner of this firm. Entry is made in the statement of accounts which was delivered to Maherukh an employee of the plaintiff. If the plaintiff had not received this statement of accounts he could not have denied this fact when he was examined in the Court. This fact strongly supports defendant No.1 that plaintiff was aware of this payment of a sum of rupees one lac to S. M. Eahi & Co. under his instructions otherwise he would have raised objection earlier. I agree with the Commissioner and hold that this sum was remitted to S. M. Elahi & Co., at the instance of the plaintiff. Legal objections.‑It was argued on behalf of the plaintiff that entries in the account books have not been produced and further that defendant No. 1 as his agent could not purchase the material without his permission. It has been held in a case reported in Haji Teller Rahman v. Golam Gone (A I R 1924 Cal, 1063) that the accounts are vouched by the production of the proper vouchers such as receipts. These vouchers are admissible as evidence of the payment of the sums therein mentioned and credit given to the accounting party in the account unless the other side shows some reasonable ground for impeaching the vouchers ; but if any party objects, the affidavit or oral evidence of the person who received the money is required and if this cannot be had, then proof must be given of his signature to the voucher. Decision reported in Kallu Mal Dhakkan Lal v. Bhawani Das Rekhab Dass (A I 'R 1925 All. 742) is based upon the provision of section 34, Evidence Act. It was held in that case that statement in books of account may be corroborated by any evidence. Another case referred to me by the plaintiff is Girdhardas Coorji v. Kerawala Karsandas & Co. (A I R 1926 Bom. 253) and it is based on sections 35, 82 and 32 (2) of Evidence Act and it was held that a certificate issued by the Manchester Chamber of Commerce is neither a public record within section 35 nor a document of the nature mentioned in section 82, nor admissible under section 32 (2). This is in respect of the report of Pakistan Cotton Association but in the instant case Secretary had been examined by defendant No.

1. The words "in the course of business" used in section 32 (2), Evidence Act have been defined in a case Palaparthi Ramamurthi v. Palaparthi Subba Rao and others (A I R 1937 Mad. 19) and it was held that business may be of a purely private or even trivial nature and it has no connection with a course of business which suggests a series of acts of business. "An entry in an account book is an admission by the maker thereof in his own favour and it is accepted as evidence only if it strictly complied with the requirements of being kept regularly and in the ordinary course of business. A I R 1932 Lah.

417. Next case relied upon by the plaintiff in this case is Ganeshi Lal v. Firm Mangot Ram Atma Ram and another (A I R 1924 Lah. 540). It was held that where the plaintiff's account books are the only evidence of the defendant's liability to pay any of the particular sums entered against them the evidence is not conclusive under section 34, and plaintiff's suit must fail. From all these cases on which reliance has been placed by the plaintiff in connection with the account books produced by defendant No. 1 it is clear from the report of the Commissioner that. A satisfactory and sufficient corroborative evidence has beer‑I produced by defendant No. 1 and it is in the shape of both oral and documentary evidence. Next legal objection raised on behalf of the plaintiff is that defendant No. 1 as his commission agent could not purchase the goods for himself without his permission. It was held in a case Firm of Rameshardas Benarshidas v. Firm of Tansookhrai Bashesharilal (A I R 1927 Sind 195) that a purchase or sale made by the commission agent of his own goods for or to his principal without disclosing that fact is not ipso facto void for failure to disclose a material fact. The words "dealings of the agent have been disadvantageous B to him . . . . . . ." mean disadvantageous in fact and not a mere possibility of their being disadvantageous. Whether such a contract is disadvantageous or not must be decided on the facts of each case and no presumption arises. In this particular case, it has been held by me that plaintiff was informed by defendant No. 1 regarding the transaction in respect of the goods covered by invoices Nos. 1 and 2 and secondly that the plaintiff his failed to prove that this transaction was disadvantageous to him. Another case referred to me in this connection is N. Joachinson and others v. Meghjee Vallabhdas (34 Bom. L R 292). It is based on sections 215 and 216 of the Contract Act. It was held that where an agent appointed to sell his principal's goods for a fixed price buys them on his own account without the previous consent of the latter, it is competent for the principal either to repudiate the transaction under the circumstances mentioned in section 215 of the Contract Act or to affirm it. In this particular case it has been shown that plaintiff when he learnt about this transaction he had ratified it. Similar view is expressed in a case Bisweswar'; Das Mondal v. Guru Charon Das (A I R 1928 Cal. 727) it lays down that an agent is bound to sell the goods of his principal on the best terms possible. The effect of the breach of this fiduciary relationship which is inherent in all agencies is that the principal is entitled to regard the transaction as a voidable transaction and to have it set aside in the usual way. Case reported in Sirdhar Vasanta Rao Ananda Rao Dhyber Killedar at Baroda v. Gopal Rao Sethn Rao Peshwai and others (A I R 1940 Mad. 299) is based on section 220 of the Contract Act and it was held that the principle underlying section 220 is that a principal is entitled to have an honest agent and it is only the honest agent who is entitled to any commission. Other cases referred to me by the parties are reported in Motilal Chimanram and another v. Sarupchand Prithiraj and others (A I R 1937 Bom. 81). It refers to effect of dissolution of partnership, and it was held that after the dissolution, partnership subsists merely for winding up its business and adjusting rights of partners inter se. In M/s. Eastern Express Co. Ltd. v. M/s. Western India Skin Exporters (P L D 1958 Kar. 355) which refers to circumstantial evidence, it has referred to well recognised principle that circumstantial evidence should be of such a nature that it could lead only to one and one conclusion alone. The firm Gukal Mal Ratnchand v. The firm Nath Mal Gulzari Mal and others (A I R 1923 Lah. 431) deals with evidence of accounts books. It was held that noting of the items in the account book kept regularly by munim in whose presence the money was not paid is no evidence. And last case is Hodi v. Nidha and another (54 I C 273). It was held in that case that defendant's liability had been discharged by payment of the debt to one of the partners. It is clear from all these cases that when the payment of a lac of rupees by defendant No. 1 to defendant No. 2 is made under the instructions of the plaintiff his liability ceases. Other cases are in respect of the account books and the proof of the entries contained. The entries produced by defendant No. I before the Commissioner are proved and corroborated. For all these reasons I dismiss the objections raised by both the plaintiff' and defendant No. I and accordingly the report of the Commissioner is confirmed. Issue No. 4 is accordingly disposed of. Part 1 of issue No. 2 was decided in the preliminary decree. In this suit it would not be necessary to give a finding regarding the terms of partnership between the plaintiff and defendant No. 2 as the relief claimed in the present suit is in respect of rendition of account by defendant No. 1 as commission agent of his firm. The version of the plaintiff that he had Rs. 0‑12‑0 share while the remaining Rs. 0‑4‑0 share belonged to defendant No. 2 has not been controverted. I, therefore, hold accordingly. Issues Nos. 8 and 9.‑Rs. 3,000 have been claimed as fee by the commissioner. No objection has been raised by any party. Looking to the amount of the work, the time taken and the labour used I allow this amount of Rs. 3,000 as fee for all the 3 commissioners who had worked. Commissioner has found a sum of Rs. 36,097.13‑6 due from defendant No.

1. Decree shall, therefore, follow for Rs. 36,097‑13‑6 and costs with running interest at 6% per annum from the date of the suit till the date of its realisation. Defendant No. 1 should also pay Rs. 3,000 fixed as fee for the commissioner and deposit in Court within one week. K. B. A. Suit decreed.