P L D 1965 (PLP)

CORNELIUS, C. J.‑This appeal comes before the Court by special leave granted to S. M. Yousuf & Brothers, whose suit against two defendants namely, Messrs Rotaprint Agency (now represented by its proprietor Mirza Muhammad Mehdi Pooya) and one Amanullah Kirtmani for the return of money lent to the latter III the capacity of manager of the Rotaprint Agency had been decreed against Rotaprint Agency by the trial Court, but had been dismissed in appeal. The suit had proceeded ex parte against Amanullah Kirmani who was admitted by the Rotaprint Agency to have been working as its manager at the relevant tine, but was said to have left that service "since quite a long time." It is stated before us that he had gone out of the country and his whereabouts were not known, but the Rotaprint Agency in its written statement had expressly taken the defence that Amanullah Ktrmani "had no power or authority from the answering defendant either to raise loans or pledge his credit." It was further pleaded expressly that Amanullah Kirmani's "authority was confined to supervise the running of the press and did not extend to borrow loans for and on behalf of the answering defendant or to pledge his credit. The matter was placed directly in issue between the parties. Proof was led that the money, Rs. l 1,200;, E, a. advanced to Amanullah Kirmani in the form of two bearer cheques and Rs. 4,200 in cash. Receipts for these monies were produced, both being written on the plaintiff firm's paper, as well as latter acknowledgment of the debt, signed by Amanullah Kirmani, on Rotaprint Agency paper. The trial Court held that the money had been borrowed by Amanullah Kirmani in the capacity of agent for Rotaprint Agency in the exercise of implied authority. The sole basis for the latter con clusion appearing in the judgment appears to be that Mirza Muhammad Mehdi Pooya. had not entered the witness box to state that Amanullah Kirmani had no authority from him to raise any loan or that in fact the sums of money in question had never been received or utilized for the purposes of the Rotaprint Agency. Neither in the judgment nor in the formal decree. are there any words to suggest, that the suit was being dismissed as against Amanullah Kirmani. Mirza Muhammad Mehdi Pooya moved an appeal against the decree in the High Court where the finding that the loan was taken on behalf of Rotaprint Agency was reversed on a considera tion of the entire evidence. The learned Judges in the High Court observed that Rotaprint Agency had from the outset denied that in the capacity of their Manager, Amanullah Kirmani had any authority. to raise a loan on their behalf. It was noted that there was no proof that the money had come to be used by the Rotaprint Agency and nothing to show that it was needed for the business of the latter Agency. There was nothing also to show that at any time Rotaprint Agency through Mirza Muhammad Mehdi Pooya had any knowledge of these transactions between Amanullah Kirmani and the plaintiff. Having thus found that Mirza Muhammad Mehdi Pooya was free of liability in respect of the loan, the next question for the consideration of the learned Judges was whether there should not be a decree made against Amanullah Kirmani. He had received the money, and had acknowledged the debt in response to a threat of legal proceedings. The learned Judges however declined to grant a decree against him, saying that the power conferred by rule 33 of Order XLI, Civil Procedure Code could not be invoked in such a case. They did not in their judgment examine the position with fullness, for a reason appearing from the passage quoted below: "We have applied our mind at great length in a similar case decided by us in Ist Appeal No. 41 of 1959 (M/s. Bakhsh Ilahi & Sons v. Mohkam Din Muhammad Amin and another) in which we had held that in the absence of a counter appeal being filed a decree against another defendant cannot be given." Accordingly, the result of the appeal was that the suit of the plaintiff was dismissed in toto. Leave was granted by this Court to appeal against this decision on the ground that a ques tion of law concerning the interpretation of Order XLI, rule 33, C. P. C., had been raised which was of considerable genera importance to litigants and further that the decision upon which the High Court had relied had been certified by the High Court itself for appeal to the Supreme Court. At the hearing of the appeal we were referred to the text of the said decision which is published as Bakhsh 1llahi & Sons Mohkamdin Muhammad Amin (P L D 1962 Kar.551). On the question of fact, namely, whether the true debtor in the case is Amanullah Kirmani, we entertain no doubt of the correctness of the decision by the High Court. Rotaprint Agency produced evidence to show that they maintained regular accounts with a cash book and receipt books for all monies coming into the firm, and that the loans in question are not supported by any receipts granted on the firm's receipt forms, nor were the relevant sums of money entered in the cash book at any place. As to the authority of Amanullah Kirmani to raise loans on behalf of Rotaprint Agency in his capacity as manager, no evidence appears on the record, but there is a clear denial on this point contained in the written statement of Mirza Muhammad Mehdi Pooya duly sworn. Moreover, the Rotaprint Agency ran a printing press, and it is plain that the raising of loans is not one of the principal activities of such a business. It is well settled that in the absence of proof to the contrary, a manager of a business which does not include borrowing of money as part of its ordinary course has no implied authority to borrow money on his principal's credit to carry on the business even if the money is urgently needed. Reference may be made in this connection to the text in the well‑known commentary on the Contract Act by Messrs Pollock and Mulla, under section 189, where several English authorities to this effect are cited. The proposition is plainly based on sound reason and its correctness is hardly open to question. It places businesses of all kinds in grave, jeopardy from actions of unscrupulous persons acting in the capacity of their manager, if loans taken by the latter, in the name of the companies they serve, were to become liabilities of those companies on that ground alone. In the present case, the receipts issued by Amanullah Kirmani for the monies he received from the plaintiff firm have been placed on the record. They are written on the plaintiff company's paper and each is signed by Amanullah. The first receipt shows Amanullah's name as the debtor, although the words "Rotaprint Agency" appear under his signature. The second is signed by him in his own name with no subscription, but the debt in the books of the plaintiff firm is in the name of Rotaprint Agency. These particulars are totally insufficient for creating a liability, by means of these receipts alone, as against the Rotaprint Agency. The case might possibly have been stronger if the reciepts had been on Rotaprint Agency form, but even in that case the question might have been raised whether Amanullah Kirmani had not unscrupulously used his Company's forms to provide evidence for loans raised exclusively for himself. One essential factor, namely that the monies had never been brought into the firm's accounts would still require to be explained. Clear indications of the true liability are however available in the letter or acknowledg ment referred to above, dated the 14th October 1957, which was sent in response to a threat of legal proceedings by the plaintiff‑Company. This letter on Rotaprint Agency paper acknowledges receipt of the threatening letter and goes on to say: "We are very grateful to the help your clients rendered us, and we are very sorry to my failure in return. At present we are very tied financially, but we are assuring you from January 58 we will start payment in instalment, and hope to settle in five months time. We hope you will be kind enough to accept my promise and inform your clients accordingly." Quite clearly, there is here an admission of personal failure to repay and expression of a personal promise to do so, both presented under a cloak of acceptance of liability on behalf of the Company of which Amanullah Kirmani was the manager. In view of this evidence, there can be no question but that liability for the loans is that of Amanullah Kirmani alone. As to the legal point, Mr. S. A. Nusrat for the appellant firm has urged that the learned Judges in the High Court were in error in thinking that they did not have power under Order XLI, rule 33, C. P. C., to grant a decree against Amanullah Kirmani in the circumstances of the present case. He referred to the terms in which the rule is expressed, which are indeed extremely wide and may be reproduced here with advantage :‑ "The appellate Court shall have power to pass any decree and make any order which ought to have been passed or made and to pass or make such further or other decree or order as the case may require, and this power may be exercised by the Court notwithstanding that the appeal is as to part only of the decree and may be exercised in favour of all or any of the respondents or parties, although such respondents or parties may not have filed any appeal or objection." The terms employed to confer the power are of the widest amplitude to enable an appellate Court to pass decrees according to the justice of the case. The language used is affirmative, and the rule is further strengthened by non‑obstante clauses, giving their clear impression that the intention is beneficial, so that no legally right should be denied which the appellate Court considers should be allowed within the framework of the suit. The non‑obstante clauses are particularly significant. The fact that the appeal is as to apart only of the decree will not, by itself, restrain the appellate Court's power. Here the whole decree was before the appellate Court, but the other non‑obstante clause is directly relevant, for it totally avoids any condition that a party seeking the benefit of the rule should itself have filed an appeal or objection. Therefore, the mere fact of the plaintiff not having filed an appeal against the failure of the trial Court to grant a decree against Amanullah Kirmani would not by itself be sufficient to justify refusal to exercise the power under the rule. The principle as stated in the judgment of the High Court, namely, that "in the absence of a counter appeal being filed a decree against another defendant cannot be given" not only constitutes a fetter upon the extremely wide power given to the appellate Court by the Code, but may also be thought to be in direct contraven tion of a clear provision in the rule. We have accordingly referred to the earlier judgment of the same Court in the earlier case of Bakhsh Illahi & Sons to examine the arguments there set out. Four precedent judgments are cited. From three of them, which are mentioned without reference to their particular facts, general propositions are extracted to the effect that the power given by the rule is widely expressed and must be applied with discretion, where interfer ence is required "to adjust the right of the parties in accordance with justice, equity and good conscience" or where the failure to exercise the power "would lead to impossible, contradictory and unworkable orders". These particular considerations un doubtedly are circumstances which would justify the exercise of the discretion conferred by the rule, but it is right that we should say that if these propositions are to be understood as limiting the exercise of the power within the circumstances specified. They would be in excess of the power given to the Courts to interpret and apply a rule expressed in such wide terms as is rule

33. The) rule confers unfettered discretion, and anything expressed in negative or restrictive terms, affecting its application must be accepted as applying only to the particular facts of the case to which the rule is being applied by interpretation. Such an interpretation cannot be extended to all or any other cases, for, each one, the application of the rule must be made beneficially, and in accordance with the relevant facts. The single case cited by the High Court with reference to its facts is that of Muhammad Khaleef Shirazi (AIR 1926 P C 34) which clearly shows points of difference. from the present case. The facts were of a mach more complicated character than they are in this case and in the result the Privy Council declined to interfere on behalf of the plaintiff to declare the liability of one of the defendants against whom his case had been expressly dismissed by the trial Court, and lie had not appealed against that decision. The Judicial Committee holding that in effect, the plaintiff was moving an appeal direct to the Privy Council from the decree of the trial Judge which is not allowed under the Civil Procedure Code opined further that Order XLI, rule 33, C. P. C., was not intended to apply to such an appeal. Here, as has been seen, the suit was never dismissed against Amanullah Kirmani. He was made a party in the trial Court and again in the appellate Court. The dispute in fact lay between the two defendants, and a case directly in point has been placed before us by Mr. Ibadat Yar Khan for the respondent, Mirza Mohammad Mehdi Pooya. This was a Full Bench decision of the Calcutta High Court reported as Rup Jaun Bibee v. Abdul Kadir Bhuyan (P I,, D 1964 Dacca 119) a case for contribution as between two defendants. The plaintiff had obtained a decree against one of the defendants and in an appeal by this defendant to which the 'other defendant was made a respondent, the Calcutta High Court held that the appellate Court had power to make the decree against the second defendant even though the plaintiff had not appealed. The point has been considered again in a recent case by the Dacca High Court which is published as Hamijan Bibi v. Darog Ali (I L R 31 Cal. 643) where the same conclusion has been reached Mr. S. A.. Nusrat has placed a number of other cases before us where power under Order XLI, rule 33 was exercised in favour of parties who had neither appealed nor objected. He placed particular reliance upon a decision of the Privy Council in the case reported as Tricomdas Coover J. v. Sri Gopinath Jiu Thakur (AIR 1926 P C 34). This was a case in which three trustees sued for royalties joining the fourth trustee as respondent and a decree was awarded in favour of the trustees it. their respective shares which was clearly erroneous. The defendant trustee did not appeal, yet the Privy Council held that the decree could be varied so as to affect his interest, giving as a reason that the "entire decree of a trial Court was brought up before the Appellate Court." In the present case, the circumstances are such as to make clearly proper that the plaintiff firm should be allowed to recover the money it advanced at least from the person to whom the money was advanced, namely Amanullah Kirmani. This person was a party in the proceedings throughout, and the true question was whether he or the other defendant, namely Mirza Mohammad Mehdi Pooya should bear the liability. The facts needed to establish his liability were proved. This was clearly not a case which the plaintiff could be left without remedy whatsoever. The) 'High Court had ample power, in appeal, to provide the remedy against the person who was really liable, within the framework of the entire proceedings. We accordingly allow this appeal, and setting aside the decree of the High Court, we award a decree to the plaintiff firm for the sum in suit with costs against the defendant Amanullah Kirmani. The plaintiff firm and the defendant Mirza Mohammad Mehdi Pooya will bear their own costs throughout. A. H. Appeal allowed.