1990 PLP 538 (MLD)

NOTIFICATION: "In exercise of the powers conferred by clause (b) of subsection (2) section 37 of the State Bank of Pakistan Act, 1956 the State Bank c Pakistan is pleased to direct the descheduling of Dubai Bank Limited o account of its merger with Union Bank of the Middle East Limited wit effect from Ist January. Sd/- (Mian Miftahuddin) Executive Director LETTER DATED 30TH DECEMBER: "

2. We have noted that Dubai Bank Limited has been merged with the Union Bank of the Middle East Ltd. with the approval of the competent authority and that the branches of the Bank in Pakistan will cease to function with effect from Ist January, 1980.

3. You may please arrange to publicise merger of the two banks in the important newspapers for the benefit of the clients of Dubai Bank Ltd." LETTER DATED 6TH JANUARY, 1986: "We have to advise that as Dubai Bank Limited has been merged with your Bank w.e.f. 1‑1‑1980 and the former bank has ceased to exist from the same date all licences for opening of branches issued to Dubai Bank Limited are required to be returned to us for cancellation. We shall therefore be glad if you will please let us have the under-noted licences issued to Dubai Bank Limited for cancellation and issuance of new licences in lieu thereof in the name of Union Bank of the Middle East Limited." It was argued by Mr. Khalid Anwar that the Dubai Bank Limited as well as Union Bank of Middle East Limited arc foreign banks. They have got their Head Offices as well as shareholders in Dubai. These banks were incorporated in Dubai. Neither it was possible for the shareholders of these banks to hold meeting and pass a scheme and submit the same to State Bank of Pakistan for sanctioning the amalgamation nor the Scheme of the Banking Companies Ordinance would envisage that the initial incorporation or sanction of any subsequent merger or amalgamation of a foreign banking company should be controlled by the Registrar of Joint Stock Companies or Banking Companies in Pakistan. The mere fact that a foreign bank carries on business in Pakistan would not give jurisdiction to Pakistan Banking Companies authorities in this regard. Mr. Khalid Anwar has relied upon a similar suit filed by same plaintiff against the same defendants being Suit No. 43/80 wherein leave to defend was granted on furnishing security in the claim amount. The case was taken in appeal (H.C.A. No. 83/80). The appeal was dismissed in limine by a Division Bench of this Court. The orders referred to above allowing the Dubai Bank Ltd. to be substituted by Union Bank of Middle East Limited and thereafter by Emirates Bank International Limited were passed by consent. The objections raised to the validity of merger of Dubai Bank into that of the Union Bank Limited appear to be afterthought and only to protract the proceedings. It was next contended that the Articles of Associations of the Union Bank Limited of Middle East provided that the Executive Committee may exercise all the powers and do all the acts on behalf of the company as is authorised to do by Board of Directors. The Power of Attorney in this case was not given by the members of the Executive Committee but by two Assistant General Managers. Hence the attornies of the plaintiff, who had filed this suit, had no power to do so. Reliance was placed on P L D 1900 S C 684?Muhammad Siddiq Muhammad Umer v. Australasia Bank limited where it was held as follows:‑‑ "It was apparent from the pleadings that the suit was being instituted by a constituted attorney of a public limited company. He could only do so he was duty authorised in that behalf and occupied one or other of the offices mentioned in Rule 1 of Order XXIX of the Civil Procedure Code. A copy of the power of attorney had been produced which showed that Muhammad Khan had been empowered in that behalf but the question still remained to be ascertained as to whether those who gave him that power were competent to do so, as the authority was on behalf of a public limited company. For this purpose a reference to the Articles of Association of the company was certainly necessary to see whether the Directors were competent to delegate such power. It was not necessary to see whether the Directors had in fact approved of the giving of such power of attorney to the person who presented the plaint. This was, however, proved by the production of the resolution of the Board of Directors as a matter of abundant caution. The additional evidence was to that extent, therefore, in our opinion, rightly admitted. This was all that was required. It was not necessary to call the Managing Director as the Court calling for the additional evidence itself realised subsequently. Even the production of the resolution could have been dispensed with, as it was not strictly necessary:"

9. From the above observation of the Supreme Court it would appear that it was neither necessary to produce the resolution nor to summon the Managing Director. All that was to be seen was whether he was duly authorised in that I behalf and occupied one or other of the offices mentioned in rule 1 of Order 29, C.P.C. which provides that pleadings may be signed and verified on behalf of the corporation by the Secretary or by any Director or other principal officer of the corporation who is able to depose the facts of the case. It would therefore appear that this defence is also not plausible.

10. It was then contended that the defendants, who had filed these applications, were only guarantors. They were trapped into guarantee agreement by fraud and collusion of plaintiff and other defendants. Defendant No.3, Faiz Muhammad Pallari, was a private person. He had denied his signature on the letter of guarantee Annexure B/1. Mr. Iqbal? Kazi has relied upon P L D 1987 Lahore 290‑‑National Bank of Pakistan v. Elegzender and submitted that in view of his denial of the signature leave should be granted. This ruling does not support the contention of Mr. Iqbal? Kazi. It was not the mere denial of the signature by the defendant but it was also admitted in the case under ruling that the disputed signatures were different from the usual signatures of defendant. Even then unconditional leave was not granted but the defendant was granted leave to defend the suit on depositing cash security in the claim amount.

11. The defence set up by defendant No.11 in Suit No.l6/86 was two‑fold. The first plea related to limitation. It was pointed out that in the insurance guarantee Annexure O/1 it was stated that if the principal debtor did not pay the sum of Rs. 30,00,000 within 8 months and 15 days from the date of releasing the gods to defendant No.l then the guarantor i.e. Union Insurance Company shall pay the said amount. Annexures O/2 and O/3 show that the goods were released on 2‑2‑1982 or at the most on 11‑3‑1982 as evidenced by Annexure O/4. All these are documents tiled by plaintiffs themselves. Hence the period of limitation of 3 years will start running from 11‑3‑1982 or at the most from 26‑11‑1985 and the suit would become time‑barred if it is filed after 27‑11‑1985. Hence the suit having been filed on 18‑12‑1985 was contended to be time‑barred. This contention does not appear to be sound. Article 115 of Limitation Act reads as under:‑‑ 115. ??? For compensation for the?????? Three years.??????? When the contract is broken, or ??????????? breach of any contract,???????????????????????? (where there are successive ??????????? express or implied, not????????????????????????? breaches) when the breach in ??????????? in writing registered and??????????????????????????????????? respect of which the suit is ??????????? not herein specially??????????????????????????????????????????? instituted occurs, or (where the ??????????? provided for.??????????????????????????????????????????????????? breach is continuing) when it ??????????????????????????????????????????????????????????????????????????????????? ceases. From the perusal of above article it would appear that it provided that the period of 3 years would start running from the date when the contract is broken or where the breach is continuing, when it ceases. In this case defendant No. 11 by their letter dated 30‑12‑1982, which is Annexure O/6 to the plaint, had B for the first time denied to honour their guarantee and the period of limitation would therefore start running from that day. Hence the suit appears to be within time.

12. Mr. Khalid Anwar had also submitted that the application of defendant No.3 in Suit No. 15/86 was time‑barred as it was filed after one year of the publication in the newspaper. Mr. Iqbal Kazi contended that the service by publication was not held good by the Registrar till he filed the application and the summons were being repeated and therefore the defendant No.3 was entitled to file application within 10 days of the date when he came to know of the filing of the suit. It was submitted by Mr. Khalid Anwar that application of defendant No.3 or affidavit accompanying it does not mention the date on which defendant No.3 came to know of the filing of the suit although he admits that he had become aware of the same. Hence the presumption would be against defendant No.l. I am however, of the view that the satisfaction of the Court about the service was the deciding factor and the service was not held satisfactory by Court.

13. It was contended by the counsel for the defendants that after the amendment of section 6 of Oaths Act by Ordinance 27 of 1981 it had become obligatory that an affidavit or evidence is to be given by a Muslim on oath and a Muslim can no more verify or swear on solemn affirmation as was previously permissible. It was therefore submitted that the verification of plaint in these suits which was on solemn affirmation and not on oath was defective. In reply Mr. Khalid Anwar contended that the verification was required to be made under Order 6, Rule 15, C.P.C. and it gives an option to the parties to verify the pleadings either on oath or on solemn affirmation. Hence the verification of plaint on solemn affirmation was a sufficient compliance of the provisions of Order 6 Rule 15, C.P.C. in spite of the fact that the person who had verified the plaint in these suits was a Muslim. I do not agree with the contention of Mr. Khalid Anwar. By virtue of the amendment of this rule by Law Reforms Ordinance No. XII of 1972 pleadings are now required to be verified on oath or by solemn affirmation. Prior to this no such making of oath or solemn affirmation was necessary for the purpose of verification of the pleadings. A subsequent amendment has also been made under Order 6, Rule 6, C.P.C. as a result of which the Court may, where it decides to proceed ex parte against the defendant, pass a decree without recording the evidence. Thus a pleading on verification on oath or solemn affirmation is raised to the status of an affidavit and is no more a simple pleading in writing. Hence Oaths Act will apply to the pleadings verified under Order 6, Rule 15, C.P.C. and therefore the pleadings ‑can be verified by Muslims, Christians and Parsecs etc. only on oath and not on solemn affirmation while Hindus could still continue to verify the pleadings on solemn affirmation if they objected to making an oath. In case of Abdur Rehman v. The State reported in 199P Cr. L J 2347 it was held by me as under:‑‑ "It would therefore, appear that before the passing of Ordinance XXVII of 1981 a Muslim could make an oath or if he had ‑any objection to making of an oath he could instead of it make an affirmation in the prescribed form but after the passing of Ordinance XXVII of 1981 whereas the Hindus had still such an option a Muslim had no option of making an affirmation instead of an oath. He was bound to take an oath and an oath alone." Hence the verification made in the plaints in the above suits is defective g and requires to be rectified.

14. Under the above circumstances I feel that the defendants in this case have been able to make out a plausible defence but it is not such that unconditional leave can be granted to them to defend the suit. Admittedly amount was advanced by the plaintiff to defendant No.l for which the remaining defendants stood surety. It is also admitted that the said amount has not been repaid. Hence I grant leave to defendants Nos.3 and 9 in Suit No. 15/86 to defend the suit on furnishing security in the guarantee amount within a period of one month. I also grant leave to defend to defendants Nos. 11 and 12 in Suit No.16/86 on furnishing security within a period of one month in the guarantee amount and further direct that in case one of them furnishes security in Suit No. 16/86 it will not be necessary for the other in Suit No. 16/86 to furnish security. I direct that the plaints in both the suits shall be rectified within one month by making the verification on oath otherwise appropriate action will be taken for non-?compliance of this order. M.B.A./E‑33/K ?????????????????????????????????????????????????????????????????????????????????? Order accordingly.