PLD 2007 Lahore 114 (PLP)

MIAN SAQIB NISAR, J.

The respondents/plaintiffs brought a suit for the recovery of an amount of Rs.3,00,000 against the appellant, under the provisions of Order XXXVII, C.P.C., on the basis of a pro note dated 28-9-2001; it is stated in the plaint, that there was some business transaction between the parties, on account of which the latter owed a sum of Rs.3,00,000 to the plaintiffs and for the purpose of securing the amount, has executed a pro note Exh.P.15, along with the receipt and also an agreement Exh.P.16 of the even date; the appellant in the written statement, has denied his liability to pay the amount; but has admitted his signature/thumb-impression upon the pro note and the receipt; he however, alleged that those were obtained by the plaintiffs on the blank papers. It is further his case that on account of supply of certain goods to him, he owed certain amount to the respondents, which he has paid through the receipts Exh.D-1 to Exh.D-7, amounting to Rs.4,30,000; thus only Rs.20,000 is outstanding against him, which amount he has withheld, for the reason that the quality of the goods supplied was inferior. In view of the pleadings of the parties, the learned trial Court, framed the following issues:- (1) Whether the plaintiffs have no cause of action and locus standi to file this suit? OPD (2) Whether the promissory note/receipt in dispute is illegal, void based on fraud and liable to be set aside? OPD (3) Whether the suit cannot proceed as the promissory note dated 28-9-2001 is contrary to the agreement dated 28-9-2001? OPD (4) Whether the plaintiffs are estopped to bring this suit by their words and conduct? OPD (5) Whether the suit is false, frivolous and vexatious. If so, whether the defendant is entitled to recover special cost from the plaintiffs? OPD (6) Whether the plaintiffs sold cloth of substantial quality to the defendant. If so, its effect? OPD (7) Whether the defendant duly executed promissory note/receipt dated 28-9-2001, in favour of the plaintiffs and received Rs.3,00,000 from them? OPP (8) Whether the defendant executed agreement dated 28-9-2001, in favour of the plaintiffs? OPP (9) Relief. Parties were put to trial; the plaintiffs examined Waheed-ul-Haq (P.W.1) and Muhammad Nadeem (P.W-2), the marginal witnesses of the receipt, attached to the pro note to prove the same; besides, Muhammad Saleem, brother-in-law, of the appellant, also appeared as P.W.3 and has deposed as under:-- "I was partner in business with the defendant Abdul Rauf in the year 2000-2001. I and Abdul Rauf, used to purchase cloth from Farooq Ahmed, etc., plaintiffs. When the plaintiffs closed business with us the plaintiffs had to receive Rs.1,35,000 from me and Rs.3,00,000 from the defendant. I had paid this amount to the plaintiffs and the defendant Abdul Rauf, did not pay the amount." The pro note, the receipt and the agreement were tendered and proved through the statement of the marginal witnesses as Ex.P-15 and Ex.P-16; the plaintiffs also produced receipts Ex.P-1 to Ex.P-14, the documents, as has been promised by the appellant/defendant to pay the amount of Rs.3,00,000 in instalments, as envisaged by the agreement Exh. P-16. As against the above, the appellant only examined himself as D.W.-1, and produced receipts Exh.D-1 to Exh.D-7 and after the trial, the learned Court below, by giving positive finding in favour of the plaintiffs on issues Nos.7 and 8 and against the defendant/appellant, on issues Nos.1 to 6, has decreed the suit. Hence this appeal.

2. Learned counsel for the appellant contends that the amount of Rs.4,30,000 out of Rs.4,50,000, has been paid by the appellant to the respondents, through receipt Exh.D-1 to Exh.D-7. It is also submitted that Exh.P-15 and Exh.P-16 were blank at the time, when the thumb- impression/signature of the appellant were procured by the respondents on these documents, which were signed etc. as a security for the payment of Rs.4,50,

000. It is further argued that the Court below, has misread the evidence on the record and has not taken into account the defence propounded by the appellant. It is lastly submitted that the pro note has not been witnessed by two marginal witnesses as required under Article 17 of the Qanun-e-Shandat, 1984 and thus no right to recover any amount could be based on the same.

3. We have heard the learned counsel for the parties. As far as, the proof of the pro note and the receipt attached thereto, as also the agreement, are concerned, these documents have been duly proved by the marginal witnesses P.W. and P.W.2; having admitted his signature and thumb-impression on the pro note, etc., in the written statement, the burden of proof, has shifted upon the appellant, to establish that he had signed and thumb-marked on the blank papers and also that the amount of Rs.4,30,000, has been paid to the respondents in lieu of the pro note.

4. We are afraid, these two important factums have not been proved by the appellant; there is no corroboration of the statement of the appellant; besides, the receipts Exh. D-1 to Exh. D-7, pertain to the period, prior to 28-9-2000, starting from 27-11-2000 till 18-1-2001. We are not convinced, if these receipts are regarding the discharge of the appellant's liability towards the pro note amount. Moreover, the statements of P.W. and P.W.2, who are the witnesses of the pro note, receipts and also the agreement, have not been shattered in the cross-examination, nor any motive has been imputed to them, that they were making a false statement. The statement of the appellant's brother-in-law, reproduced above, who has appeared as P.W. 3, also supports the case of the respondents. In the light of above, we are of the view that the plaintiffs have proved their case and the trial Court, has rightly decreed the suit.

5. As regards the argument about the lack of attestation of the pro note by two witnesses, resulting into the non-compliance of the provisions of Article 17 (2)(a) of the Qanun-e-Shahadat, 1984, it may be held that the application of the sub-clause ibid is subject to clause (2) of the Article, which clearly ordains "unless otherwise provided"

"in any Special Law." Now the questions which arise for consideration are (i) whether the Negotiable Instruments Act, 1881 (the Act) is a Special Law (2) and whether the Act provides for the non-attestation of a promissory note by the witnesses.

6. In order to answer the first question, it may be held that the Order 1984, came into force on 26-10-1984; it is the General Law pertaining to the evidence, through which the Evidence Act of 1872 was repealed and replaced. The expression appearing "any Special Law" in the Article undoubtedly means the Special Law dealing with the Special subject, which were existing at the time of the enforcement of the Order. As at that time, the Negotiable Instruments Act 1881, was duly in force and therefore, for all intents and purposes, it is the Special Law, within the meaning of the said Article. For answering the second question, we find expedient to reproduce the definition of the promissory note given in the Act, which reads as below:-- "4. "Promissory note": A "Promissory note" is an instrument in writing (not being a bank-note or a currency-note containing an unconditional undertaking, signed by the maker, to pay on demand or at a fixed or determinable future time a certain sum of money only to, or to the order of, a certain person, or to the bearer of the instrument". It is clear from the above that in order to qualify as a promissory note, the instrument must fulfil the following four conditions, which must co exist:-- (i) an unconditional undertaking to pay; (ii) the sum should be a sum of money and should be certain: (iii) the payment should be to, or to the order of, a person who is certain or to the bearer of the instrument; (iv) and the maker should sign it. From the very nature, the promissory note and the cheque (defined in section 6) which are negotiable instruments, cannot be attested by the witnesses and in case, any signatures by the stranger are appended thereupon, the signing shall be presumed to have been made as an indorser within the contemplation of section 29-C, of the Negotiable Instruments Act and thus in view of the section 35, "in the absence of a contract to the contrary the indorser of a negotiable instrument by indorsing it engages that on due presentment, it shall be accepted and paid according to its tenor and that if it shall be dishonoured, he will compensate the holder or subsequent indorser, who is compelled to pay any loss or damage caused to him by such dishonour. Every indorser after dishonour is liable as upon an endorsement payable on demand". Therefore, in view of the above, the attestation of a pro note by the witnesses is impermissible and can only be made by a stranger in the capacity and the status of an indorser.

7. Besides the above, according to the provisions of section 2(5)(b) of the Stamp Act, 1899, if an instrument, which may otherwise be a promissory note, but if attested, by the witnesses, it attains the legal status of a bond and no more remains a negotiable instrument; thus one of the important tests to determine whether an instrument is bond or a promissory note, is the attestation of the witnesses. Reference in this behalf can be made upon the judgment reported as Ram Narayan Bhagat and another v. Ram Chandra Singh and others (AIR 1962 Patna 325), Haji Hamzo Panhwar v. Muhammad Ibrahim, and another (PLD 1963 (W.P.) Karachi 962) and Dayal and another v. Bhimma (1925 Oudh 188). In the light of above, we are of the considered view that the promissory note Exh.P-15 was not required to be attested by any witness. Even otherwise, at the time, when it was tendered in evidence by the respondent, no objection was raised by the appellant and the document has been proved by the two marginal witnesses of the receipt.

8. Learned counsel for the appellant has also not been able to convince us, if there is any misreading and non-reading of the evidence of the Courts below or any legal or factual infirmity in the impugned judgment and decree, calling for interference in this appeal, thus the same has no merits and is hereby dismissed. S.M.B./A-201/L Appeal dismissed.