1998 PLP 371 (SCMR)

FAZAL KARIM, J.

The suit out of which this petition for leave to appeal has arisen was instituted by the respondent, Investment Corporation, of Pakistan (the corporation) against the petitioner; that facts, basis of its claim can be shortly stated. The respondent had agreed to underwrite a sum of Rs.10,000,00 being the value of ordinary shares of Rs.10 each out of the pubis offering of two lac ordinary shares of Rs.10 each to be made by Universal Oil and Vegetable Ghee Mills Limited. According to the terms contained in the underwriting agreement dated 14-11-1968 executed between the Universal Oil and Vegetable Ghee Mills Ltd. and the respondent-Corporation; the defendants, petitioners herein, agreed by an agreement dated 11th December, 1968 to purchase the shareholding of the respondent-corporation and it was upon that agreement, that the respondent corporation's claim in the suit, for the recovery of Rs.19,26,878.26 was founded. For the purpose of this petition it is sufficient to state that the suit was defended, among others, on two grounds; (1) Syed Ihtisham Taqi who had instituted the suit on behalf of the respondent-corporation had no authority to do so and the suit was not competent and (2) that the Ghee industry had, in the meantime been nationalised and the shares held by the Universal Oil Vegetable Ghee Mills having been acquired by the Federal Government under the Hydrogenated Vegetable Oil Industry (Control and Development) Act, 1973, the contract stood frustrated in term of section 56 of the Contract Act.

2. The suit was decreed; the petitioners appealed to the High Court but were unsuccessful. They now seek leave to appeal.

3. Learned counsel for the petitioners have pointed out that the objection that Syed Ihtisham Taqi had no authority to institute the suit and to act on behalf of the respondent-corporation was taken in the written statement and it was, therefore, necessary for the respondent-corporation to produce the original power of attorney to show that he had been duly constituted an attorney of the respondent-corporation. All that the respondent-corporation did, so runs the argument, was to produce a photo copy of a power of attorney purported- to have been executed in favour of Syed Ihtisham Taqi. Learned counsel for the petitioners also points out that in the opinion of the learned Judges, "the power of attorney has been notarised by a Notary Public and, thus, carries a presumption as to its due execution under section 85 of the Evidence Act, 1872 which was the law applicable at the relevant time". That section, it is argued, was not relevant because the power of attorney was not executed before the Notary Public. Learned counsel for the petitioners then argued that in any case the contract had been frustrated by the supervening fact of the nationalization of the Ghee Industry and the requisition of the shares held by the Universal Oil Vegetable Ghee Mills Ltd. by the Federal Government.

4. Leave to appeal is granted, inter alia, to consider these contentions. Leave to appeal, however, will be subject to the condition that the petitioners furnish a bank guarantee to the satisfaction of the trial Court in the sum of Rs.10,00,000 and furnish security to the satisfaction of the Trial Court as regards the remaining decreed amount within a month of this order. A.A./J-6/S Leave granted.