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Suit No. 259 of 1967, decided on 27th February, 1985.

---S.9--Suit--Preliminary decree passed for specified amount--Findings in such preliminary decree could not be objected to at time of passing of final decree--Aggrieved person, however, could file appeal against such preliminary decree.

---O.XXVI, r.ll--Commissioner appointed by Court to examine accounts--Commissioner's. finding based on certificate of Income-tax Officer--Such certificate having been produced by defendant No illegality or impropriety, found in assessment of income for relevant period by Commissioner on basis of certificate of Income-tax department--Plea that defendant having paid income-tax in respect of income belonging to plaintiff benefit had to be grunted to such defendant--Held, if income-tax had been paid by defendant in respect of income belonging to plaintiff hoe was not entitled to any adjustment for such income-tax.

---S. 9--Suit--Preliminary decree granted as prayed in suit--Interest had been claimed as 9 per cent in prayer clause oaf suit--Granting of such interest, held, justified.

Syed Hassan Zafar for Plaintiffs.

Muzaffar Hassan for Defendant No.l(b).

Date of hearing: 7th February, 1985.

This suit had been filed by the plaintiffs for the recovery of Rs.2,20,000 from defendant No.l, which amount, according to the plaintiffs, was the sale price of the property in suit sold by defendant No.l and which property, according to the plaintiffs, defendant No.l held as a "benamidar" for the predecessor-in-interest of the plaintiffs, Another prayer was made in the suit by the plaintiffs for a direction to defendant No. 1 to furnish accounts an respect of moneys realized and profits earned by defendant No.l for the period the property remained with defendant No.l. The suit was contested by defendant ,No-1, her defence being that she was the owner of the property in suit and the plaintiffs had no right or interest in the property. It may be observed here that the property in suit was 10 per cent share in Regal Syndicate. It has also been pleaded by defendant No.l that the suit was barred by limitation. By judgment dated 4-9-1983, the suit was decreed against defendant No.1 for a sum of Rs, 2, 20,000 and a preliminary decree for accounts was also passed. Paragraph 38 of the judgment dated 4-9-1983 of the learned Judge is reproduced hereinbelow:-

"As a result of the discussion above I decree the suit of the plaintiffs against defendant No.l for a sum of Rs.2,20,000 and the plaintiffs are entitled to recover this amount from defendant No. 1. 1 also pass a preliminary decree for accounts as prayed in para 25 of the plaint. The defendant No. l shall render accounts of all the profits and earnings and pay the amount which may be found due to the plaintiffs in view of my findings on issues Nos.5 and 9. Issue No.11 is also answered in the negative. Before parting with the case 1 may again mention that the remaining issues were not pressed during the arguments. Suit decreed as prayed."

It may be mentioned here that according to the plaint, the following was the prayer of the plaintiffs for accounts:

"(ii) That the defendant No.l do render true and faithful accounts of all amounts received by her on account of profits of the business of the said firm right from the commencement of the said business until the date on which she sold out the 10% share standing in her name in the business and properties of the said firm and do pay to the plaintiffs the amounts found due and payable by her to the plaintiffs upon rendition of such accounts;"

It may also be observed that during the pendency of the suit defendant No.l died and her legal heirs were brought on record as defendants No.l(a), 1(b) g 1(c).

By order dated 11-12-1983, the Nazir of this Court was appointed as Commissioner to examine the records of the accounts in terms of the prayer contained in para.2(ii) of prayer clause in the plaint i.e. for the period mentioned in that clause. The Nazir/Commissioner submitted his report dated 17-9-1984. On behalf of the plaintiffs, objections dated 16-10-1984 were filed. On behalf of the legal heirs of defendant No.1, only defendant No.l(b), Sadruddin A.Muhammad, initially filed his objections on 6-11-1984 but later on his counsel Mr.Muzaffar Hasson, Advocate was allowed to file further objections and these were submitted on 4-2-1985. I have heard Mr.S.H. Zafar learned counsel for the plaintiffs and Mr. Muzaffar Hassan, learned counsel, who has appears d for defendant No.l(b). No one appeared on behalf of other defendants.

2. Mr.S.H. Zafar, learned counsel for the plaintiffs, did not press the objections on behalf of the plaintiffs. However, Commissioner's Report has been vehemently opposed by Mr.Muzaffar Hassan, learned counsel for defendant No.l(b).

3. Certain facts and positions are admitted. The date of commencement of business is admitted as 28-2-1948. It is also admitted that October, 1967, defendant No.l sold the 10 per cent share for Rs.2,20,000. In view of the judgment dated 4-9-1983, defendant No.1 was required to render accounts from the date of the commencement the business, i.e. 28-2-1948, upto the date when the 10 per cent share was sold out by defendant No.l, i.e. October, 1967. According to the judgment dated 4-9-1983, it has also been decided that defendant No.l had received Rs.1,49,160 as profits coming to her 10 per cent share from the business of Regal Syndicate from the commencement of the business upto February, 1958. The Nazir/Commissioner accordingly issued notices to the plaintiffs and defendants No.l(a), 1(b) and 1(c) to file accounts regarding the profits for the period from March, 1958 to October, 1967. According to the plaintiffs, defendant No.1 was supposed to have earned income of Rs.3,97,690 from 1958 upto October, 1967 and they also claimed interest on this amount. Plaintiff No.3 also claimed interest on the sale price of 10 per cent share from October, 1968 to March, 1984. According to the report of the Commissioner dated 1 -9-1984, defendant No.l(b) while filing his statement of accounts relied upon the certificate dated 23-2-1984 issued by the Income Tax Officer, Film Circle, Central Zone D, showing the income of defendant No.1 from Regal Cinema for the assessment years 56-57 to 1968-1969. In the absence of any other documentary evidence, the Commissioner relied upon the certificate of income issued by the concerned Income Tax Officer. The Commissioner has calculated the income of defendant No.l from the commencement of business upto October, 1967 as follows:-

The Commissioner has also stated in his report dated 17-9-1984 that the plaintiffs are entitled to interest at the rate of 9 per cent per annum on the aforesaid amount from the date of the filing of the suit.

4. Mr.Muzaffar Hassan, learned counsel for defendant No.l(b), had attempted to challenge the figure of Rs.2,20,000 being the sale proceeds 10 per cent share sold by the defendant No.l in October, 1967 and the figure of Rs.1,49,106 as the profit from the commencement of the business upto February, 1958. 1 did not allow Mr. Muzaffar Hassan to make any submission in this regard, as these two figures are to be and in the judgment dated 4-9-1983 and these figures cannot be challenged at the present stage.

The assessment of income by the Commissioner for the period March, 1958 to October, 1967 is based on the certificate of the concerned Income Tax Officer, which certificate had been produced by defendant No.l (b) himself during the proceedings before the Commissioner. I find no illegality or impropriety in the assessment of the income for this period by the Commissioner on the basis of the certificate of the concerned Income Tax Officer. However, it was submitted by Mr. Muzaffar Hassan, learned counsel for defendant No. l(b) that defendant No.l had paid income tax and benefit of this has to be granted to the legal heirs of defendant No.l. I find no merit in this submission. According to the judgment dated 4-9-1983, the income of the 10 per cent share belonged to the plaintiffs and defendant No.l had to render accounts for all the income received from this share. If any income tax has been paid by defendant No.l to the Income Tax Department in respect of the income which belonged to the plaintiffs, defendant No.l is not entitled to any adjustment for such income-tax.

It was then argued that the claim for accounts for period prior to November., 1964, is barred by limitation. By judgment dated 4-9-1983 it has already been held that the suit is not barred by limitation. By judgment dated 4-9-1983, defendant No. l was required to render accounts C for the period from February, 1948 to October, 1967 If the defendant No.l(b) or any other defendant was aggrieved by the judgment dated 4-9-1983, an appeal could have been filed.

It was then contended by Mr. Muzaffar Hassan, learned counsel for the defendant No.l(b) that interest has wrongly been given in the Commissioner's report dated 17-9-1984. According to the learned counsel, the plaintiffs are not entitled to any interest. The Commissioner in his report dated 17-9-1984 has stated as follows:-

"The Honourable Court vide judgment dated 4-9-1983 has decreed the suit as prayed. A perusal of the prayer clause No. (iii) will show that the plaintiffs have claimed interest at 9% from the date of the filing of the suit until judgment and interest at the same rate until realization of the decretal amount.

Thus the plaintiffs are entitled to 9% interest on Rs.4.78,499.00 from the date of the filing of the suit i.e. 6-11-1967 till the date of judgment i.e. 4-9-1983 which comes to Rs.6,81,861.08 plus interest till realization of the decretal amount."

From a perusal of the judgment dated 4-9-1983 it is found that the suit has been decreed as prayed. This is the last sentence of para 38 of the judgment dated 4-9-1983. It has been correctly pointed out by the Commissioner in his report that in the prayer clause interest has also been claimed at 9 per cent, and by decreeing the suit as prayed, the judgment dated 4-9-1983 also awards interest as claimed by the plaintiffs in the prayer clause. I find no reason or justification to reject or alter the report of the Commissioner dated 17-9-1984

5. A final decree is accordingly passed in favour of the plaintiffs and as against defendants No.l(a), 1(b) and 1(c) in the sum of Rs.4,78,499 with interest at the rate of 9 per cent per annum from the date of filing of the suit till realization. The plaintiffs shall also be entitled to costs as against defendants No.l(a), 1(b) a 1(c).

It may be observed that the decretal amount of Rs.4,78,499 includes the amount of Rs.2,20,000 for which a decree was passed on 4-9-1983.

A.A

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