P L D 1988 Lahore 166 (PLP)

This suit for recovery of Rs.43,17,444.56 has been instituted under the Banking Companies (Recovery of Loans) Ordinance 1979 by Allied Bank of Pakistan Limited, the plaintiff against M/s Gujrat Friends Traders and four others, the defendants. the plaintiff has also prayed for award of interest at the rate of 14% per annum with quarterly rests from the date of institution of the suit till realization of the claimed amount as also for costs of the suit.

2. The plaintiff has asserted that a current account was opened by defendant No. 1 with Chowk ‑Nawab Sahib Branch, Gujrat of the plaintiff‑Bank on 15‑3‑1979; that on the request of defendant No. 1 firm of which defendants Nos. 2 to 5 are the partners the plaintiff opened on their behalf letters of credit for import of capacitors vide letters of credit detailed below for value and margin shown against each: (i) Letter of Credit No. 79%039, dated 24‑6‑1979 in the sum of US $ 20,604 for the import of Capacitors. Margin : 15% = Rs.30,750. (ii) Letter of Credit No. 79/040, dated 24‑6‑1979 in the sum of US $ 59,296 for the import of Capacitors. Margin : 15% = Rs.88,500 (iii)Letter of Credit No. ?9/046, dated 27‑6‑1979 in the sum of US $ 59,296 for import of Capacitors. Margin : 15% = Rs.88,500 (iv) Letter of Credit No. 79/047, dated 28‑6‑1979 in the sum, of US $ 59,296 for the import of Capacitors. Margin : 15% = Rs.88,500 that the letters of credit aforementioned were opened on the basis of four different applications and agreements for documentary credit submitted by the defendants and under terms thereof the defendants were under an obligation to pay the amounts due and retire, the shipping documents on arrival of shipment; that despite due information the defendants failed to retire the documents against the aforementioned shipments which obliged the plaintiff to incur necessary expenditure for having the shipments cleared by payment of customs duty etc. and the imported material was then stored at Gujrat at to cost and risk of defendants as agreed to under the letters of credit application:,; that despite repeated requests the defendants did not liquidate the loan amount and thus, incurred the liability to pay additional 5% interest as agreed to in the applications and agreements for documentary credit originals whereof have been placed on record; that four LINT accounts were opened on account of the failure of the defendants to have the documents retired arid the statements of account pertaining thereto have been annexed with the plaint duly certified under the Bankers" Books Evidence Act, 1891.

3. It is further asserted in the plaint that the defendants executed the charge documents as detailed in para 7 of the plaint, documents i to iv pertain to each individual LIM account whilst the document at No. v. viz. demand promissory note, dated 30‑6‑1983 was executed by the defendants against consideration of the total accumulated amount due under the four LIM accounts as those stood on 30‑6‑1983. Alongwith this demand promissory note letter of waiver, interest and disbursement, letter of continuity and General Form of security for all advances and loans were also executed on the same date. According to the plaint, the balances outstanding were also separately confirmed for each account by the defendants vide confirmations, dated 31‑12‑1980, 30‑6‑1982, 31‑12‑1982 and 30‑6‑1983.

4. The further allegation in the plaint is that the defendants have failed to liquidate their liability despite repeated requests and, therefore, as on 31‑12‑1985 a sum of Rs.43,17,444.56 stood due from them to the plaintiff. The details of the amount due are given in para.9 of the plaint.

5. Summonses in Form 4 of Appendix B of the Code of Civil Procedure were issued to the defendants and in response thereto a petition for leave to appear and defend the suit (P.L.A. No. 22‑B/86) was filed by defendants Nos. 1 and 2 only. The other defendants viz. Nos. 3 to 5 did not file any petition then. P.L.A. No. 22‑B/86 was dismissed for non‑prosecution on 17‑6‑1986 whilst the other defendants viz. Nos. 3 to 5 were proceeded against ex parte. Consequently on the same day viz. 17‑6‑1986 the suit of the plaintiff was decreed against all the defendants as prayed for in the plaint. Defendants Nos. 1 and 2, however, filed application C.M. No. 89‑8186 under section 6 of the Banking Companies (Recovery of Loans) Ordinance read with Order IX, Rule 13, C.P.C. for recalling my order, dated 17‑6‑1986 and after setting aside the decree passed against the said defendants restore P.L.A. No. 22‑B186 to its original number for hearing on merits. Defendants Nos. 3 to 5 also filed an application C.M. No. 138‑B/86 under Order XXXVII, Rule 4, C.P.C. for setting aside the decree against them. Vide my order,‑ dated ?‑4‑1987 the application (C.M. No. 89‑B/86) filed by defendants Nos. 1 and 2 was allowed and setting aside the decree passed against them the petition for leave to appear and defend the suit filed by them was restored to its original number. The application of the other defendants, namely, defendants Nos. 3 to 5 (C.M. No. 138‑B/86) was, however, rejected by order of the same date with the result that the decree as against them remained intact.

6. Defendants Nos. 3 to 5 on 23‑4‑1987 also appear to have filed a petition under Order XXXVII, Rule 3, C.P,.C. (P.L.A. No. 34‑B/$7). This petition obviously is of no consequence. The decree against these defendants having already been passed and their request for recalling the decree having also been rejected this application o1 necessity has to be rejected inter alia being time‑barred. Order accordingly.

7. The petition of the first two defendants P.L.A. No. 22‑B/8f has been resisted by the plaintiff. The learned counsel for defendants Nos. 1 and 2 has raised the following contention in support of the petition: (1) That demand promissory note, dated 30‑6‑1983 is without consideration and has not been executed by defendant No.2; (2)That the imported stocks under the four LIM accounts wens sought to be released by the defendants, but the plaintiff‑Bank did not release the stock which has resulted in accumulation of the interest against them and the defendants having asked for the release of the goods are not liable to pay the claimed amount; (3)That the suit is barred by time in that the LIM accounts were created in 1980 with the last LIM account having been created on 6‑11‑1980 the suit filed on 16‑1‑1986 is not within time; (4)That penal interest has been charged without agreement of the defendants to pay the same; and (5)That the pledged goods have been exposed to weather conditions and thus loss has been caused to the defendants.

8. On the contrary, the learned counsel for the plaintiff has contended: First, that demand promissory note has been duly executed by the' defendants and the consideration therefor is the cumulative amount due against the four LIM accounts as these stood on 30‑6‑1983; Secondly, that the balance of each LIM account has been separately confirmed vide the original letters of confirmation placed on record and appearing at pages 83, 125, 163 and 195 of the file, the total of which comes to the amount which is the consideration of demand promissory note, dated 30‑6‑1983; Thirdly, that the document aforementioned viz. demand promissory note is the only document which is dubbed as not signed by defendant No. 2 whereas the other accompanying documents viz. the letter of waiver, interest and disbursement, letter of continuity and general form of security for all advances and loans executed by defendant No. 2 on the same date have not been in any manner controverted and a naked eye comparison of the signatures on the first of the named documents and the other three documents clearly shows that the first document was also signed by defendant No.2; Fourthly, that the ground now being taken for alleged loss to the pledged goods due to weather conditions is only an afterthought and it has not even been raised in petition for leave to appear and defend the suit and that the said allegation otherwise is also incorrect in that the imported stocks are lying stored in the main godown of the plaintiff‑Bank at Gujrat and not exposed to weather conditions as alleged; Fifthly, that the suit is well within time as there are regular reacknowledgements of the loan during all this period last of which is dated 30‑6‑1985 and the suit having been filed on 16‑1‑1986 cannot in any manner be held to be barred by time; and Sixthly, that the additional interest of 5$ has been charged as it had been categorically agreed vide clause 13 of the four applications and agreements for documentary credit duly signed by defendant No.2. In the above context the learned counsel for the plaintiff also submitted that additional interest has been charged only upto 30‑12‑1982 amounting to Rs.1,96,626 and that as a matter of grace no such interest has been charged with effect from 1‑3‑1983 and not even claimed in the suit.

9. In reply the learned counsel for the contesting defendants only submitted that the demand promissory note of 30‑6‑1983 has not been signed by defendant No.

2. The learned counsel was asked to specifically deny the signatures on the said document on which he stated that he is not in a position to do so. He also had no comments to ‑make on the assertion of the learned counsel for the plaintiff regarding the other three documents which were statedly executed simultaneously with the aforementioned demand promissory note.

10. Having given consideration to the controversy involved I am of the view that the contentions raised on behalf of the defendants have no force. They have been squarely met with by the learned counsel for the plaintiff in his arguments and I see great force in the submissions made on behalf of the plaintiff. It has been correctly pointed out by the learned counsel for the plaintiff that there is intrinsic evidence deducible from the documents on record to show that the consideration for the demand promissory note, dated 30‑6‑1983 was the cumulative amount due from the defendants to the plaintiff under the four LIM accounts as on the date of the execution of the demand promissory note. The denial of signatures on the demand promissory note is only a vague allegation which cannot be given any weight especially when neither the signatures thereon have been specifically denied after examination of the documents by the learned counsel despite affording of an opportunity and there is neither any denying the execution of the other three connected documents in the petition for leave to appear nor are they even controverted today. If such vague denials of signatures are given effect it would obviously give an encouragement to all persons who may have executed the documents to baldly deny the signatures thereon and avail of the opportunity of delaying the proceedings by getting permission to defend the suit. Such a course would amount to defeating the very purpose for which the statute under which the suit has been filed was enacted.

11. Again it has been correctly contended on behalf of the plaintiff' that the allegation of exposure of the pledged stock to the weather B conditions is only an afterthought as such a plea has not been even set up in the petition for leave to appear and defend the suit. It is well‑settled that a party cannot be allowed to argue on any point specially the one relating to a controversy of fact which has not been specifically set up in the pleadings of a civil proceeding. The above principle is based on the maxim allegata et probata. The defendants, therefore, cannot be allowed to canvass the above factual point as it ought to have been specifically set up in the pleadings first.

12. As regards the charge of penal interest no contention has been raised on behalf of the defendants in reply to the arguments of the learned counsel for the plaintiff whose submissions find support from the documents placed on record.

13. Adverting to the only other contention of the defendants viz. the suit being hit by limitation I suffice by observing that the same again is a bald allegation without any substance both on legal or ~ factual planes. The various documents referred in the discussion hereinabove clearly go to show that the suit has been filed within the period of limitation.

14. In view of the foregoing discussion I find no merit in petition of defendants for grant of permission to defend the suit. The said petition (P.L.A. No. 22‑Bl86) is, therefore, dismissed.

15. Resultantly the contents of the plaint shall be deemed to be correct and admitted. Accordingly a decree with costs is hereby passed in favour of the plaintiff and against the defendants for recovery of the sum of Rs.43,17,444.56 together with interest at the rate of 14$ per annum with quarterly rests from the date of institution of the suit till realization of the total decretal amount. A.A./A‑220/L Suit decreed