2025 PLP 2001 (MLD)

Asim Hafeez, J.

This single judgment shall decide this and appeal bearing R.F.A. No. 18345/2025 - wherein material facts, parties to the proceedings, transactional arrangement(s), causes of action and gist of evidence manifest conspicuous similarities other than difference in the amount(s) of subject matter cheques. Even composite arguments are addressed by learned counsel in appeals. Details of cheques are elucidated in following paragraphs to highlight distinctiveness. A) Instant Regular First Appeal is directed against judgment and decree dated 01.03.2025, whereby suit instituted by respondent under Order XXXVII Rules (1) and (2) of the Civil Procedure Code, 1908 (the 'Code'), based on Cheque No.48181408 amounting to Rs.5,000,000/- (cheque), was decreed. B) Regular First Appeal No. 18345/2025 is directed against judgment and decree dated 01.03.2025, whereby suit instituted by respondent under Order XXXVII Rules (1) and (2) of the Civil Procedure Code, 1908 (the 'Code'), based on Cheque No.48181406 amounting to Rs.300,00,000/- (cheque), was decreed. Hence, these appeals.

2. Facts essential for adjudication of appeals are that respondent claimed sale of sacrificial animals (contemporaneous to Eid-ul-Azha) against consideration payable and allegedly committed through cheque(s), which dishonoured due to insufficient funds in the account. Appellant submitted application(s) seeking leave to appear and defend, wherein same claimed that neither any cheque(s) was delivered to the respondent nor any transaction for purchase of animals was ever transacted or happened. It was alleged that cheque(s) in question [in all nineteen cheques] were delivered to one Bashir Masih to fulfil appellant's obligation under insurance policy and since cheques were blank, therefore, they were misused. It is claimed that 2 of the cheques were subject of claim of the respondent. Application(s) for leave to defend was granted, issues framed and evidence recorded, whereafter claim of respondent, based on cheque(s), was decreed.

3. Appellant's counsel submits that Trial court erred in law in granting decree while misconstruing section 118 of the Negotiable Instruments Act, 1881, which extends rebuttable presumption regarding element of consideration of negotiable instrument. Adds that appellant denied any contractual arrangement with the respondent and delivery of cheque and had reasonably established factum of providing of cheques to Bashir Masih in lieu of appellant's obligation under an insurance policy and factum of Bashir's employment with insurance company stood proved. Adds that evidence of Bashir [PW-2] suggests his close proximity with the claimant. Submits that apparent discrepancies in the evidence led, case pleaded and failure to bring evidence to prove commercial arrangement__sale / purchase of animals__disentitle respondent from securing a decree. Following cases are cited, reported as "Mehr Noor Muhammad v. Nazir Ahmed" (PLD 2024 SC 45), "Syed Ali Hussain Naqvi v. Ali Sher Naqvi" (2005 CLC 1751), "Tanveer Ahmed v. Imtiaz Anwar" (PLD 2025 Lahore 486), "Mst. Akhtar Sultana v. Major Retd. Muzaffar Khan Malik through his legal heirs and others" (PLD 2021 SC 715), "Rustam and others v. Jehangir (deceased) through L.Rs" (2023 SCMR 730), "Khawaja Javed Mehmood v. Punjab Industries Corporation through Regional Director Rawalpindi and 2 others" (2024 CLC 1503), "Mst. Afia Ambrine v. Additional District Judge, Sialkot and 14 others" (PLD 2025 Lahore 124), "Abdul Majid through General Attorney v. Anjum Akhtar" (2024 CLC 1727), "Muhammad Afzal v. Muhammad Aslam" (2022 CLD 1318) and "Sadia Parveen v. Muhammad Umer" (2025 YLR 539).

4. Conversely, respondent's counsel pleaded that cheque was issued in the name of the respondent against appellant's bank account, and signatures were not disputed. Submits that witnesses of delivery of cheque were produced and onus was on the appellant to prove absence of consideration. And no illegality was committed by the Trial Court while passing the decree.

5. Heard. Original Record examined.

6. Appellant denied consideration of alleged cheque(s) and is obligated to dispel presumption attracted in terms of the section 118 of the Act, 1881. Plea raised that cheque(s) were provided to one Bashir Masih in performance of contractual obligations regarding insurance policy were put to Bashir Masih [PW-2], who denied receipt of blank cheques but admitted factum of employment with insurance company factum of Bashir's employment with insurance company was admitted by PW-1, attorney of the respondent. Bashir's evidence did not meet the benchmark of an independent witness and convincing enough to support claim of respondent. Perusal of original cheque(s) manifest interpolation. I have examined the original cheque which contained writings with different ink-signatures were made with dark ink and other details were with different ink. This discrepancy lends credibility to the plea that details on cheque(s) were added at later stage and in piecemeal. For the sake of adjudication, evidence led by appellant, if read in absolute isolation may not outrightly prove absence of consideration, against the cheque(s), but when read in the context of conspicuous shortcomings / discrepancies in the evidence led by the holder of the instrument claim of presumption under section 118 of the Negotiable Instruments Act, 1881 stands rebutted. Details of the shortcomings / discrepancies are as follows; Firstly, respondent did not appear as a witness and no plausible explanation was provided for this absence; secondly, plaint alleged privity of commercial arrangement of sale / purchase of sacrificial animals between appellant and respondent but evidence led is inconsistent, wherein appellant's nephew was portrayed as beneficiary of part of the transaction. Whether cheque(s) in question was provided to repay consideration for sale / purchase. This is a material issue. In wake of denial of alleged transaction and obligation of payment of consideration, and upon discharge of initial burden by the appellant to challenge claim of presumption, onus shifts and respondent is required to bring direct evidence to substantiate conduct of commercial transaction but same had failed. No witness even alleged that transaction of sale and purchase of animals was negotiated and carried out in his / their presence. From the perusal of evidence, it transpires that case of the respondent was that cheque(s) was issued to discharge existing payment obligation, already accrued upon alleged sale / purchase of animals for sacrifice on the occasion of Eid. The preceding transaction had to be proved essentially to secure a decree on the cheque(s). No direct evidence was produced to prove existence of alleged transaction. PW-1, respondent's attorney, claimed that respondent had arranged animals from other persons who had pressed for payments but none was produced. Even no details of number of animals sold and relevant dates were not provided. PW-1 and PW-2 were not the witnesses of alleged transaction. PW-1 was the proxy witness for respondent, appointed through special power of attorney, wherein name of the respondent was spelled as Shahzad Vickey and on cheque the bearer was identified as Shahzad Wiki. No details of the bank account of respondent were brought on record to enable to ascertain whether account was operated in the name of Shahzad Vickey or Shahzad Wiki. Respondent brought two suits, one claiming cheque of Rs.5.00 Million and other cheque of Rs.30.00 Million__latter cheque is subject of RFA No.18345/2025__and no evidence was proved that respondent's worth to raise or arrange animals worth Rs.35.00 Million. Case has to be decided on the touchstone of the principle of 'preponderance of evidence'. I am convinced that when contrary stood established respondent cannot seek refuge behind presumption in terms of section 118 of the Negotiable Instruments Act 1881. Jurisprudence regarding special rules of evidence in the context of section 118, ibid, is reaffirmed in the case of "Mehr Noor Muhammad v. Nazir Ahmed" (PLD 2024 SC 45), relevant part of the decision is reproduced hereunder, "We now focus on another aspect of the matter and examine whether the preponderance of evidence brought on record suggest a probability to conclude that any amount was paid to the defendant. Be it noted here, no doubt, special rules of evidence are provided for under the Negotiable Instrument Act, 1881. Its section 118 says that until the contrary is proved, inter alia the presumption that every negotiable instrument was made for consideration shall be drawn. Such a presumption is only a prima facie, and may be displaced by raising a probable defence. Since the circumstantial evidence discussed above gave rise to a probable defence and created a reasonable doubt regarding the valid execution of the promissory note (Ex.P.1), the burden was shifted to the plaintiff to prove the payment of consideration of Rs. 800,000 and as such, we have to examine the plaintiff's evidence."

7. In view of the above, I hold that judgment(s) impugned are unsustainable in law, being contrary to settled principles of law. Appeals are allowed and impugned judgment(s) dated 01.03.2025 are hereby set-aside and suit(s) of the respondent are dismissed on account of respondent's failure to substantiate alleged claim against cheque(s) under reference, when underlying transaction(s) remained unsubstantiated. No order as to the costs. UN/H-7/L ??