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Judgment Sheet

IN THE LAHORE HIGH COURT AT LAHORE

JUDICIAL DEPARTMENT

RFA.No. 418-2006

Muhammad Hussain Vs. Malik Allah Yar Khan

JUDGMENT

Dated of hearing: - 24.4.2012

Appellant by: - Mr. Amir Abdullah Khan Niazi,

Advocate

Respondent by: - Nemo

Shahid Waheed, J:-

Challenge in this appeal is to the

judgment and decree dated 30.6.2006 passed by the learned Additional District Judge, Mianwali, whereby the appellant's suit for recovery of

Rs.2,10,000/- was dismissed.

2. Briefly stated the facts of the case are that the appellant

Muhammad Hussain instituted a suit under Order 37 Rule 2 CPC against the respondent/defendant, Malik Allah Yar Khan, for recovery of a sum of Rs.2,10,000/- on the basis of pronote dated 16.8.2002 (Ex.P1). As per contents of the plaint, the respondent on 16.8.2002 approached the appellant for Qarze Hasna amounting to Rs.2,10,000/-. The appellant keeping in view the cordial and previous conduct of the respondent extended Qarze Hasna to the respondent in the presence of Muhammad Saeed (PW-2) and Muhammad Hanif and as a security thereof the respondent executed pronote (Ex.P1) and promised to return the amount on demand. In response to summons issued by the learned trial court the respondent appeared before the court and moved an

RFA.No.418-06 2

application for grant of permission to appear and defend the suit. In the said application the respondent denied the receipt of disputed amount and execution of the pronote. Learned trail court granted leave to appear and defend the suit and in pursuance thereof a contesting written statement was filed by the respondent.

3. The learned trial court reduced the controversy into following

issues:-

1. Whether the pronote regarding Qarze Hasna

of Rs.2,10,000/- was executed between the parties ?OPP.

2. Whether the suit is not maintainable in view

of principle of estoppel and waiver? OPD.

3. Whether the plaintiff has no cause of action

against the defendant? OPD

3.A Whether the pro-note dated 16.8.2002 is

illegal and based on fraud, mis-representation and liable to be rejected? OPD

4. Relief.

In support of their respective pleadings the parties to the suit produced oral as well as documentary evidence. Abdul Waheed appeared as PW-

1, Muhammad Saeed appeared as PW2, Muhammad Amir (Special

Attorney of the plaintiff) appeared as PW-3. The plaintiff produced documentary evidence i.e pronote (Ex.P1), special power of attorney (Ex.P2), attested copy of pre-emption suit (Ex.P3), attested copy of revision petition (Ex.P4) and copy of Identity Card (Mark A). Conversely the respondent/defendant, Malik Allah Yar appeared as DW-1. He produced Wakalatnama executed in favour of Malik Saeed

RFA.No.418-06 3

Akhtar Ghaanjera, Advocate (Ex.D1). Application for permission to appear and defend the case (Ex.D2) and Wakalatnama extended in favour of Syed Azhar Abbas Naqvi, Advocate (Ex.D3). Learned trial court after recording the evidence dismissed the suit vide judgment and decree dated 30.6.2006. Feeling aggrieved, the appellant has preferred the instant appeal.

4. Learned counsel for the appellant submits that the impugned

judgment and decree suffer from mis-reading and non-reading of evidence; and, that the learned trial court fell in error while dismissing the suit on the ground that the pronote (Ex.P1) was not properly stamped.

5. We have heard the learned counsel for the appellant and perused

the record.

6. Pivotal issues in the instant case are Issue Nos.1 and 3-A. The

onus probandi was on the plaintiff to prove Issue No.1 i.e whether the pronote regarding Qarze Hasna of Rs.2,10,000/- was executed between the parties, whereas the burden to prove Issue No.3-A viz whether pronote dated 16.8.2002 is illegal, void and based on fraud, mis- representation and liable to be rejected was on the defendant/respondent. These two issues are interlinked and are, therefore, decided together. Before proceeding further we may like to mention the important principle of law which says that a party is not allowed under the law to improve its case from what was not originally set up in the pleadings. This principle is contained in maxim Secundum

RFA.No.418-06 4

allegata et probata which means that the fact has to be alleged by the parties before it is allowed to be proved and this principle has also been affirmed by the Hon'ble Supreme Court in the case of Pakistan v Abdul Ghani (PLD 1964 S.C 68), M/s. Ch. Brothers Ltd v Jaranwala Central Cooperative Bank Ltd and others (1968 SCMR

804) and Amir Shah v Ziarat Gul

(1998 SCMR 593). Keeping in view the afore stated principle of law, the cumulative reading of the contents of the plaint, statement of Muhammad Amir (special attorney of the plaintiff) PW-3 and statement of the respondent, Malik Allah Yar Khan (DW-1) would be helpful to resolve the aforesaid issues. The plaintiff in para-2 of the plaint states that on 16.8.2002 he extended financial assistance amounting to Rs.2,10,000/- as Qarze Hasna to the respondent in the presence of witnesses, namely, Muhammad Saeed (PW-2) and Muhammad Hanif. On the contrary, Muhammad Amir being special attorney of the plaintiff appeared as PW-3 and in his examination-in -chief admitted that his brother Noor Zaman sold his property and the respondent alongwith one Muzaffar Khan persuaded him to file a suit for pre-emption against the vendee. On their insistence a suit for possession through pre-emption was instituted for the benefit of Muzaffar Khan. PW-3 also stated that Muzaffar Khan on the request of the respondent gave Rs.2,10,000/- to the respondent for pursuing the suit. During the course of cross examination PW-3 further admitted that the plaintiff told him that instant suit had been filed for recovery of that amount which Muzafffar Khan gave to the respondent for pursuing the

RFA.No.418-06 5

suit for pre-emption. The statement of PW-3 and contents of the plaint are contradictory. In fact special attorney of the plaintiff, Muhammad Amir (PW-3) has negated the case set up in the plaint and resultantly it is established that no Qarze Hasna, as alleged in the plaint, was lent to the respondent/defendant. Besides above, other two witnesses, namely, Muhammad Saeed (PW-2) and Abdul Waheed (PW-1) have not stated a single word about the contemporaneous payment of consideration amount of pronote (Ex.P1) to the respondent. In other words no witness has been produced to prove the payment of consideration amount. In this view of the matter, one irresistible conclusion is that pronote is without any consideration and, therefore no decree on its basis can be passed and, the plaintiff had no cause of action against the defendant

6. Notwithstanding above findings on Issues No. 1 and 3-A we are

constrained to hold that the learned trial court has erroneously held that the suit could not be decreed as pronote was not properly stamped. In order to clarify this issue, it is stated that a pronote is liable to be stamped under Article 49 of the Stamp Act and by virtue of the amendment made by the Punjab Finance Act, 1995 stamp of an amount of Rs.100/- was payable if the amount of pronote exceeds Rs.5,00,000/- . Pronote (Ex.P1) was, thus, deficient stamp. However, proviso- (a) to section 35 of the Stamp Act, which is a curative provision, covers the situation according to which if any instrument is not stamped or insufficiently stamped, shall be admitted in evidence on payment of

RFA.No.418-06 6

penalty. In the case of Muhammad Akram v Muhammad Saleem (PLD 1971 S.C 561) the Hon'ble Supreme Court has held as follows:- "This view is on principle too sound for once a document has been admitted in evidence without objection, its admissibility cannot subsequently be challenged, on any technical ground or any ground which does not affect the parties. The collection of revenue is no concern of the parties. That purpose is adequately served by section 61. There is no reason, therefore, as to why the bar created by section 36 should not be given effect to. In the present case there can be no manner of doubt that the document was admitted, marked as an exhibit without any objection and when it was put a number of witnesses in examination and cross- examination. The objection on the ground of want of stamp cannot, therefore, be raised at this stage." Hon'ble Supreme Court in the case of Union Insurance Company of Pakistan Ltd v Hafiz Muhammad Siddique (PLD 1978 S.C 279) while interpreting sections 35 and 36 of the Stamp Act has held as:- Additionally, I find nothing in the section which would support the appellant's plea that an instrument becomes invalid, if it falls within the mischief of the section. After all, if an instrument is invalid, it must be invalid for all purposes, but proviso (d) to the section expressly saves unstamped instruments in most criminal proceedings, whilst the other provisos to the section enable the parties to overcome the disabilities attached to an instrument not properly stamped by paying the requisite duty together with a penalty, therefore, this would suggest that the object of the section is to protect public revenue. Again, if an instrument is invalid, it should not be admissible in evidence, and it is so stated in section 35. But the next section prescribes that if an instrument has been admitted in evidence, howsoever erroneously, its

RFA.No.418-06 7

admissibility cannot be questioned at any stage thereafter, and even the appellant Court's powers to entertain an objection about the admissibility of documents have been removed section

61, which instead empowers the appellate Court to collect the

duty payment on the unstamped instrument together with a penalty. These provisions as well as other provisions in Chapter IV of the said Act, such as sections 33,38,39 and 40, can only lead to the conclusion that the object of the Legislature is enacting the said Act was to protect public revenues and not to interfere with commercial life by invalidating instruments vital to the smooth flow of trade and commerce."

In the case of Rehmat Ali v Wahid Bux

(NLR 1979 Civil S.C 809),

Hon'ble Supreme Court has held as follows:-

"An instrument which has been received in evidence in violation of section 12, such as in the instant case, could be admitted in evidence and under section 26 its admissibility would not be open to question." Hon'ble Supreme Court in the case of Sirbaland v Allah Loke and others (1996 SCMR 575) has recorded the following observations:- "10- Adverting to Ch. Khalil-ur-Rehman's third submission that Exh.P.W.1/1 was not admissible for want of payment of proper stamp duty, it may be observed that no objection was raised by Sirbaland or his counsel when the above document was exhibited. In this view of the matter, section 36 of the Stamp Act, 1899, hereinafter referred to as the Act, was attracted to, which provides as follows:- "36. Admission of instrument where not to be questioned ---Where an instrument has been admitted in evidence, such admission shall not

RFA.No.418-06 8

except as provided in section 61, be called in question at any stage of the same suit or proceedings on the ground that the instrument has not been duly stamped." In terms of the above section read with section 61 the Act, above respondents had deposited Rs.44, of which they have produced a certificate from the District Accounts Officer, Sialkot, dated 26.4.1995. In this behalf, reference may be made to the case of Union Insurance Company of Pakistan Ltd v Hafiz Muhammad Siddique (PLD 1978 SC

279), in which it has been held that the object of section 35

of the Act is not to invalidate the instrument not properly stamped but to protect the public revenues. It was further held that unstamped or improperly stamped arbitration agreements were not invalid but only subject to disabilities specified in section 35 of the Act. The above stamping is done at the behest of the Court below."

7. In view of afore cited judgments rendered by the Hon'ble

Supreme Court, we do not approve the finding of the learned trial court qua the inadmissibility of pronote (Ex.P1) and observe that payment of stamp duty is a matter between a citizen and the State and an adversary cannot be permitted to capitalize on a technicality which, otherwise was not fatal to the suit.

8. For what has been discussed above, the appeal being devoid of

any merit and substance is dismissed with no order as to cost. (Muhammad Khalid Mehmood Khan) (Shahid Waheed)

Judge Judge

Approved for reporting

Judge

RFA.No.418-06 9

Arshad*

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