2020 PLP 31 (CLCN)

AZHAR SALEEM BABAR, ACJ

The above titled appeal has been filed to set aside the decree and judgment of the Court below dated 21.03.2019.

2. Stated facts of the case are that Raja Azmat Khan, the respondent/plaintiff filed a suit for recovery of amount of Rs.1,50,00,000/- against the appellant/defendant in the Court of District Judge Muzaffarabad on 22.01.2016. He contended in the plaint that Mohammad Rizwan Sheikh borrowed a sum of Rs. 4,27,500/- and executed an agreement to return the money within 06 months, The agreement was executed on 27.01.2015 and the appellant/defendant executed receipt in that regard as well. It was further agreed by the appellant/defendant that if he fails to return the money on time he would be liable to pay double amount along with the expenses incurred on litigation. The respondent further contended that when he demanded the amount from the defendant on expiry of 6 months, the defendant filed a frivolous application against him in Police Station City Muzaffarabad. The plaintiff was summoned by the police however the application was dismissed by the police when the respondent/plaintiff showed the agreement dated 27.01.2015. The plaintiff claimed that he was defamed by the act of defendant and was mentally tortured. The plaintiff sent legal notice to the defendant for payment of Rs. 1,50,00,000/- including damages but he did not respond. The respondent/ plaintiff claimed the amount with the following details. i. Mental torture and defamation Rs. 1,40,00,000/- ii. Double of amount borrowed by the defendant equal to Rs.8,55,000/-. iii. Miscellaneous expenditure Rs. 1,45,000/-.

3. The respondent/plaintiff attached agreement dated 27.01.2015 with the plaint. The appellant/defendant filed written statement and claimed set off in the terms that agreement dated 27.01.2015 has been misinterpreted by the plaintiff. It was explained that the plaintiff wanted to borrow a sum of Rs. 1,00,00,000/- as both had cordial friendly relations. The defendant stated that he offered the plaintiff to sell his house in Rawalpindi and transferred the house in his name for this purpose. The house was sold for a sum of Rs.47,50,000/-. It was decided that the plaintiff shall pay a sum of Rs. 47,50,000/- to the defendant within a year. The defendant explained that he went abroad and demanded amount worth Rs. 47,50,000/- from the plaintiff after a year when he came home back. He further explained that the respondent/appellant had already sold his house situated in Rawalpindi. The defendant stated that the plaintiff started threatening him and that the defendant was assaulted by unknown persons on 23.11.2013. It has been explained that unknown persons shot five pistol fires on him and he was hit by a bullet in his left leg. The defendant lodged an FIR with the Police Station City Muzaffarabad but did not nominate the plaintiff.

4. The appellant/defendant further claimed that he remained under treatment in Al-Shafa Hospital Islamabad and after getting recovered, demanded the amount from the plaintiff through elders of locality. The plaintiff and his brother Raja Bilal sought time and Raja Bilal delivered a cheque on him. On such assurance, the defendant entered into a bargain of land situated in Sangri Mera and paid Rs.5,00,000/- as earnest money. The plaintiff did not pay the amount on time so earnest money paid by the defendant was confiscated. He further contended that he convened a Jirga again and the plaintiff executed an agreement on 02.06.2014 and his brother paid a sum of Rs. 5,00,000/- in cash. The plaintiff further delivered a cheque worth Rs. 4,500,000/- instead of 47,50,000/- and promised to pay rest of amount Rs.2,50,000/- within a year.

5. It was stated that the plaintiff transferred an amount of Rs.40,00,000/- to the account of defendant on 18.09.2014 in negation of the agreement. With the aforementioned details, the appellant/defendant claimed that a sum of Rs.7,50,000/- is payable by the plaintiff to him. The appellant/defendant admitted the claim of the plaintiff to the extent of agreement dated 27.01.2015 and requested in his written statement that after deduction of amount of Rs. 4,27,500/- from the amount of Rs.7,50,000/-, the plaintiff is liable to pay off Rs.3,22,000/-.

6. Arguments heard. The appellant/defendant has claimed set off in his written statement. Order VIII, Rule 6, C.P.C. provides the particulars and effect of set off claimed through a written statement. For convenience Order VIII, Rule 6, C.P.C. is reproduced as under:

6. Particulars of set-off to be given in written statement

(1) Where in a suit for the recovery of money the defendant claims to set-off against the plaintiff's demand any ascertained sum of money legally recoverable by him from the plaintiff, not exceeding the pecuniary limits of the jurisdiction of the Court, and both parties fill the same character as they fill in the plaintiff's suit, the defendant may, at the first hearing of the suit, but not afterwards unless permitted by the Court, present a written statement containing the particulars of the debt sought to be set-off. Effect of Set-off... (2) The written statement shall have the same effect as a plaint in a cross-suit so as to enable the Court to pronounce a final judgment in respect both of the original claim and of the set-off, but this shall not affect the lien, upon the amount decreed, of any pleader in respect of the costs payable to him under the decree. (3) The rules relating to a written statement by a defendant apply a written statement in answer to a claim of set-off.

7. It is evident from the afore reproduced provision of law that defendant has not to file an independent suit for recovery of money claimed through set-off. The written statement in itself is treated as cross suit and the defendant can be remedied as per his claim. The Supreme Court of Pakistan in a case reported as 2009 SCMR 666 has mentioned the following essential ingredients of a legal set off. i. The suit must be one for the recovery of money. ii. As regards the amount claimed to be set-off. a. It must be an ascertained sum of money. b. Such sum must be legally recoverable. c. It must be recoverable by the defendant or by all the defendant if mere than one. d. It must be recoverable by the defendant from plaintiff or from all the plaintiffs if more than one. e. It must not exceed the pecuniary limits of the jurisdiction of the Court in which the suit is brought; and f. Both the parties must fill, in the defendant claim to set-off, the same character as they fill in the plaintiffs suit.

8. The appellant/defendant admitted the claim of respondent to the extent of Rs.4,27,500/-. He has, however, claimed that the plaintiff owes him an amount of Rs. 7,50,000/-and after deduction of the amount claimed in the plaint, the plaintiff has to pay a sum of Rs. 3,22,500/- to the defendant. The Court below framed issues Nos. 5 and 6 regarding the controversy. Both the issues are reproduced herein under:

9. It has been simply concluded by the Court below that the defendant could not prove issue No. 5, so the same was decided against him. For the reasons mentioned in issue No. 5, it was further concluded that the defendant could not prove issue No. 6 as well.

10. It appears that the Court below has not scrutinized the evidence on record by applying judicial mind. Statement of Raja Azmat Kamal, the plaintiff is important to settle issues Nos. 5 and

6. The plaintiff relied on agreement dated 27.01.2015 and proved agreement by providing a marginal witness Raja Junaid Rafique as well. For proper appreciation cross-examination on the plaintiff is reproduced as under:-

11. A perusal of statement reproduced above reveals that the plaintiff admitted that he sold the house of defendant situated in Rawalpindi and transferred an amount of Rs. 40,00,000/- to his account. He further admitted that the house was sold for a sum of Rs. 47,50,000/-. Out of remaining amount of Rs. 7,50,000/- the plaintiff claimed that he paid a sum of Rs. 2,50,000/- to the defendant in cash and delivered a cheque worth Rs. 2,50,000/- to the defendant which was returned by the defendant. So, an amount of Rs.5,00,000/- was admitted by the plaintiff as outstanding against him. He explained that instead of Rs. 5,00,000/- he paid a sum of Rs. 6,17,000/- to the defendant. The plaintiff claimed that he paid a sum of Rs. 1,17,000/- in excess to the amount due to him. He, however, admitted that he did not take a receipt of excessive amount from the defendant. It is amazing to observe that the appellant admits that he got receipt of payment of Rs.40,00,000/- and again got a receipt of amount Rs.4,27,500/- but he is not in possession of receipt of Rs.7,50,000/- or the excess amount of Rs.1,17,000/-.

12. A perusal of statement of Raja Azmat Kamal, the respondent/ plaintiff leads to the conclusion that he could not prove that he paid a sum of Rs. 2,50,000/- in cash to the defendant. He claims that as against outstanding amount of Rs. 5,00,000/- he paid an amount of Rs.6,17,000/- to the defendant but his claim does not prove from evidence produced by him. It is, therefore, concluded that the appellant/defendant claims set-off worth Rs. 3,22,500/- as against the plaintiffs claim. The plaintiff has admitted during cross-examination that he sold the house of defendant for an amount of Rs. 47,50,000/- out of which he paid an amount of Rs, 4,00,000/- to the defendant through bank transaction. The respondent/plaintiff stated that he paid the rest of amount of Rs. 7,50,000/- to the defendant with the detail that Rs.2,50,000/- was paid by him in cash and a sum of Rs.6,17,000/- was paid to the defendant in cash against outstanding amount of Rs.5,00,000/-. The respondent/plaintiff could not prove his assertion through any evidence. Only witness appearing for the plaintiff i.e. Raja Junaid Qayum is marginal witness of the agreement dated 27.01.2015 and he has deposed nothing about the payment of Rs.47,50,000/- to the defendant. The upshot of the above discussion is that the appellant/ defendant has proved that an amount of Rs.7,50,000/- is outstanding against the respondent/plaintiff. The defendant has further admitted that he owes a sum of Rs. 4,27,500/- to the respondent/plaintiff and thus an amount of Rs. 3,22,500/- is payable by the respondent/plaintiff. The appeal is therefore, accepted and it is declared that the respondent/ plaintiff owes a sum of Rs. 3,22,500/- to the appellant. As a result of above discussion, decree and judgment of the Court below is set aside. This judgment shall operate as decree for the appellant/defendant. ZC/10/HC(AJ&K) Appeal allowed.