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Suit No. 88 of 1971, decided on Ist October, 1980,

‑‑ S. 19‑Acknowledgement of liability‑Competency of suit Pro‑note executed on 31‑3‑1962‑Execution of balance confirmation slips dated 3‑3‑1965 and 31‑12‑1967 and demand promissory note dated 23‑2‑1968 admitted by defendant‑Suit filed on 13‑2‑1971, held, within time.

‑‑ S. 68‑Property in respect of which mortgage executed, cancelled by Settlement Authorities‑Apart from execution of mortgage deed defendants also executing demand promissory note for balance due against him in overdraft account‑Held, plaintiff fully entitled to sue defendant on basis of over securities and documents available to them in form of pronote.

Miss Majida Rizvi for Plaintiff.

Naseem Faroo ui for Defendant.

Date of hearing : 1st October, 1980.

The plaintiff has brought this suit for recovery of Rs.1,56,066.25 against defendant on account of overdraft facilities granted to the defendant. The claim of the plaintiff is not contested to so far the fact of granting the over‑draft facilities and the amount due on the date of filing of the suit is concerned. The defendant has however disputed the claim of the plaintiff on the grounds of (i) incompetency of the promissory note executed by him, (ii) the suit being barred by limitation and (iii) that the original advance having been made against a mortgage security the Suit was not competent for a personal decree against the defendant. On the pleadings of the parties the following consent issues were framed ;‑

(1) Whether the suit is based on incompetent promissory notes and writings and is therefore not maintainable. ,

(2) Whether the suit is barred by limitation.

(3) Whether advance was relatable to mortgage security and there is absence of personal liability of the defendants. If so its effect

(4) Whether the suit not having been based on the mortgage is liable to be dismissed.

(5) What should the decree be

When the suit came up for evidence it was adjourned on, a number of occasions at the request of the defendant on the ground that the defendant was negotiating for a. settlement with the plaintiff. On 25‑8‑1980 when this suit came up before me a similar request was made on behalf of the defendant, and I adjourned the bearing of the suit in the first week of September, 1980 to give a last chance to the defendant to settle the matter with the plaintiff. However, before adjourning the suit on that day the parties were directed to admit and deny the documents, and as a result thereof, the documents which were admitted by the defendant were brought on record as Exh. 6 to Ex.25. On 30‑9‑1980 when this suit again came up before me for evidence the defendant filed an application for adjournment on the ground that he has proceeded to Bahawalnagar in connection with some important business. The application also mentioned the ground that the matter has been settled between the plain tiff and defendant on 30th August, and that the proposal for settlement is now for consideration before the Pakistan Banking Council for a formal approval. The request made on behalf of defendant was very seriously objected to by the learned counsel for the plaintiff who also stated that he has no such informa tion as is disclosed in the application. In view of the objection taken by the Plaintiff's counsel and also in view of the fact that this suit was adjourned more than a dozen time earlier on the ground of settlement, I rejected the application of the defendant and proceeded with the suit. The plaintiff in support of his claim in the suit has examined Muhammad Iqbal Adam (Exh. 26) This witness has supported the averments made in the plaint and has also stated that the pro‑note, balance confirmation slips executed by the defendant from time to time were complete in all details and were duly filled in by the bank before the defendant had signed them. The witness has also produced the correspondence between the parties and a registered mortgage deed, and a registered Power of Attorney executed by defendant in favour of the plaintiff and a certified copy of the statement of account has also been pro duced by this witness which shows the balance of Rs.1,56,066.25 as on 28th January, 1971. The burden of the issues framed in the suit is entirely on the defendant except Issue No. 2 which relates to limitation and of which the burden will be on the plaintiff as admittedly the first pro‑note was executed by the defendant on 31st March, 1962, while the present suit was filed in the year 1971. .1 will accordingly first take up issue No. 2.

2. Issue No. 2.‑The Plaintiff has produced the original pronote dated 31st March, 1962, which was signed by the defendant immediately after having availed of the overdraft facilities. The amount mentioned in this document which is Exh. 6 is Rs.80,000. The signature and the contents on this document are admitted by the defendant. After execution of Exh. 6 the defendant also admitted execution of balance confirmation slip Exh. 7 which is dated 3‑3‑1965. This document show that a sum of Rs.92,528.48 was due and payable by the defendant on 31st December, 1964. This was followed by Ex. 8 which is dated 31st December, 1967, and according to this document, which is a balance confirmation slip and execution whereof is also admitted by the defendant, a sum of Rs.1,18,665.31 was due and payable by the defendant to the plaintiff on the date of execution of this document. After execution‑0111 Exh. 8 another document Exh. 9, which is a demand promissory note was also executed by defendant and signature on this document is admitted by the defendant, although contents are denied.

According to this promissory note Ex. 9, which is dated 23rd February, 1968, on the date of execution a sum of Rs.1,19,571.71 was due and payable by the defendant to the Plaintiff. This promissory note was forwarded to the Plaintiff by the defendant through a covering letter Exh. 10, which is also of the same date. . The defendant has denied the contents of the document Exh. 8, Exh. 9 and Exh. 10. He has however, failed to adduce any evidence that the contents of this document are not correct or were not filled in at the time he signed them. In fact the letter Exh. 10 is a typed letter signed by the defendant by which Exh. 9 was forwarded to the plaintiff. The contents which were written in hand in Exh. 9 are confirmed in Exh. 10 which is a typed letter of defendant and by which Exh. 9 was forwarded to the plaintiff. The witness of the plaintiff has stated on oath that at the time Exh. 8 and Exh. 9 were executed by the defendant, they were filling in all its contents and that it is only after these documents were complete that the defendant has put his signature there on. The statement of the. plaintiff's witness has gone unrebutted. The suit' was filed on 13th February, 1971. The last document executed by the defers dant admitting the liability is dated 23‑2‑1968. The suit is therefore within

time.

3. Issue No. 1‑The burden of proof of this issue is on the defendant. It is asserted on behalf of defendant that the suit is based upon an incompe tent promissory note and therefore not maintainable. The original pronotc bears the signature of the plaintiff. It also bears revenue stamps of the value of 8 Kannas. All these stamps are duly defaced. At the time this document was executed the stamp duty payable on the pronote was 8 Kannas only. I ac cordingly hold that the defendant has failed to prove that the promissory note Exh. 6 is incompetent.

4. Issues 3 and 4.‑I take up both these issues together as these are interconnected. The burden of these issues is also on the defendant. It is contended in the written statement that the overdraft having been obtained and relatable to mortgage security, there is no personal liability on the defen dant, and the suit having not been filed on the basis of the mortgage deed is liable to be dismissed. There is ample documentary evidence on record in the form of letters written by the defendant to the Plaintiff, copies of the orders of the Court to show that the property in respect of which the mortgage was executed by the defendant in favour of the plaintiff was soon after execution of the mortgage deed Exh. 26/1, was cancelled by the Settlement Authorities, and it was never restored in favour of the defendant till today. It is also not denied that apart from the execution of the mortgage deed, the defendant had also executed demand promissory note for the balance due against him in the overdraft account. The Plaintiff has not been able to point out anything which would prevent the Plaintiff from suing on the basis of the pronotes executed by defendant from time to time. The admitted position is that the mortgage on account of cancellation of the transfer of property in favour of defendant does not exist any more. In these circumstances, the plaintiff was fully entitled to sue the defendant on the basis of othe securities and documents available to them in the form of pronote. I accordingly hold that the suit on the basis of the pronote filed by the Plaintiff is fully competent, and the defendant has failed to prove that be was not personally liable for the debt and that the suit is liable to be dismissed having no been filed on the basis of the mortgage.

5. The result is that the Plaintiff's suit is decreed in the sum of Rs.1,56,066/25 with costs but interest will be payable from the date of filing of the suit till the amount is paid at the rate of 9 per cent per annum simple

interest.

K. M. A. Petition dismissed.

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