2022LHC4191

Download as pdf or txt
Download as pdf or txt
You are on page 1of 11

Stereo H.C.J.D.

A 38

Judgment Sheet
IN THE LAHORE HIGH COURT LAHORE,
MULTAN BENCH, MULTAN
JUDICIAL DEPARTMENT
R.F.A No.90 of 2021

Abdul Maalik Versus Abdul Sattar

JUDGMENT

Appellant by: Mr. Muhammad Azhar, Advocate.

Respondent by: Mr. Muhammad Asif Manzoor, Advocate.

Date of hearing: 09.06.2022.

MUHAMMAD SHAN GUL-J:- Through this judgment the

titled regular first appeal is sought to be decided.

2. Facts in brief are that the respondent before this Court filed

a suit under Order XXXVII, Rule II of CPC against the appellant

for recovery of Rs.50,000/-. It is stated in the plaint that in order

to effectuate a compromise in crime report No.134/2014, Police

Station Saddar Ali Pur the appellant gave a cheque drawn on the

NRSP Bank amounting to Rs.50,000/- to the respondent as

consideration for the compromise and so as for the appellant to

get out of the rigours of criminal law and that on the scheduled
RFA. No.90 of 2021 2

date when the cheque was presented for encashment the same was

dishonored on account of insufficient funds and hence the suit.

3. This cause of action has been explained quite vividly in the

plaint according to which the respondent, upon a dacoity at his

residence, got registered a crime report bearing No.134/2014 at

Police Station Saddar Ali Pur for offences under Section

397,458,337F-5 PPC and nominated the appellant by way of a

supplementary statement and who eventually secured bail from

this Court. That during the course of trial a compromise was

effectuated whereby the loss occasioned to the respondent was

apportioned equally between all nominated accused and as a result

whereof Rs.50,000/- were to be paid by the appellant who issued a

cheque drawn on the NRSP Bank for the said purpose. This

cheque was for a determined amount of Rs.50,000/- and when the

cheque was presented for encashment the same was dishonored on

account of insufficient funds and the respondent returned empty

handed from the bank alongwith a dishonor slip. That the

respondent approached the appellant thereafter but the appellant

remained unmoved and the respondent had no choice but to file a

suit on the basis of the negotiable instrument in question. That a

crime report for dishonor of cheque was also registered. That on

03.04.2019 the respondent also addressed a notice in terms of the

Negotiable Instruments Act, 1881 to the appellant but the same

remained un-responded.
RFA. No.90 of 2021 3

4. This narrative of the respondent has been admitted by the

appellant during the course of evidence who has stated in his

examination in chief that he was a nominated accused in a crime

report pertaining to dacoity and on account of a compromise

having been effectuated he was saddled with the liability to pay

Rs.50,000/- to the respondent and that he handed over a cheque

drawn on his account in the NRSP bank to the respondent. That

eventually he paid Rs.50,000/- to the respondent in cash but the

respondent refused to hand back the cheque to him.

5. As is evident the issuance of the disputed cheque is

admitted and in terms of Section 118 of the Negotiable

Instruments Act, 1881 it shall be presumed that the cheque was

issued for consideration and hence is a valid negotiable

instrument.

6. The appellant filed a written statement in the matter and out

of the pleadings of the parties the following four issues were

framed:

Issues:

1. Whether the defendant had borrowed an amount of


Rs.50,000/- from the plaintiff and in lieu of the same
issued cheque No.1893454 dated 01.05.2019? OPP

2. Whether cheque above mentioned in issue No.1 has


been dishonored on its presentation? OPP

3. Whether in consideration of said cheque amount was


actually paid by the plaintiff to the defendant or not?
OPD
RFA. No.90 of 2021 4

4. Whether the cheque was issued as a guarantee to the


plaintiff and no payment was ever paid against the
disputed cheque? OPD

7. The respondent in order to prove the issues appeared in the

witness box as PW-1 and reiterated the contents of his plaint. His

witnesses PW-2 and PW-3 outrightly supported his narrative and

these three witnesses were supported and backed by the testimony

of PW-4 i.e. Branch Credit Officer of NRSP Bank who stated that

on 02.05.2016 the cheque in issue was presented but was

dishonored and returned to the respondent with a dishonor slip.

8. On the other hand, the appellant appeared as his own

witness and controverted the stance of the respondent. One

Ghulam Yaseen appeared as his witness and supported his stance.

However both of them could not offer any plausible reason or

basis about why if the appellant had allegedly paid the amount of

Rs.50,000/- to the respondent the cheque in issue was not taken

back or for that matter why no effort was undertaken to retrieve

the cheque in question and why even no suit for its cancellation

had been filed. This disconnect dampens the case of the

appellant!

9. The trial court noted that the issuance of cheque or for that

matter the cheque itself was not disputed and had in fact been

admitted by the appellant but who had failed to discharge the onus

of proof about paying up the disputed amount to the respondent

through cogent or inspiring evidence. The trial court rightly drew


RFA. No.90 of 2021 5

upon the fact that in the presence of hostilities between the

competing parties and in the presence of previous criminal

litigation which clearly revealed animosity between the parties,

the omission to retrieve the cheque was fatal and the only

presumption that could be drawn from this particular aspect was

that no payment had been made because the same could not be

proved and also because the cheque had been allowed to be

retained by the respondent. Moreover, no witnesses were cited or

brought forward to establish the contention pertaining to return of

money. The trial court also noted that the respondent on account

of his statement which was supported by his witness’s statements

and which in turn were bolstered by the statement of the

representative of the bank, had driven home his stance, so to

speak, and had discharged the initial onus of proof and which

could not be rebutted by the appellant and hence decreed the suit.

10. Likewise, the lame ancillary stance of the appellant about

the cheque having been issued by way of guarantee did not find

favour with the trial court and rightly so because no evidence was

led to even remotely establish the element of guarantee.

11. I have heard the learned counsel for the appellant as also

learned counsel for the respondent. While the counsel for the

respondent has supported the impugned judgment and decree, the

counsel for the appellant has attacked the judgment and decree as

being erroneous. Learned counsel for the appellant submits that


RFA. No.90 of 2021 6

there was no consideration on account of which the cheque had

been issued and that nothing had been received by the appellant

on account of which he had issued the cheque in question and that

hence there was no consideration and the requirements of Section

118 of the Negotiable Instruments Act, 1881 had not been met.

12. The question before this court, therefore, is whether the

concession on the part of the respondent in allowing the

appellant to get out of the rigours of criminal law qualifies as

consideration or not.

13. The term consideration has been defined in the Contract

Act, 1872 as follows:

“When, at the desire of the promisor, the


promisee or any other person has done or
abstained from doing, or does or abstains from
doing, or promises to do or to abstain from
doing, something, such act or abstinence or
promise is called a consideration for the
promise”.

14. Naturally the term consideration as it appears in the

Negotiable Instruments Act, 1881 carries the same connotation,

and has to be interpreted in the light of the definition of the term

consideration as contained in the Contract Act, 1872. It may be

seen that the words “for consideration” as used in Section 118 of

the Negotiable Instruments Act, 1881 are quite general. While

there is a presumption of consideration having passed for a

negotiable instrument there is no presumption as to the nature of


RFA. No.90 of 2021 7

such consideration or for that matter even the kind of such

consideration. To constitute consideration it is even not necessary

that something should already have been done. It is sufficient if

there is a promise to do an act. In “Nathu v. Wali Muhammad and

another” (AIR 1933 Lahore 121) it has been lucidly held at page

122 that abandonment of a disputed claim is a valid consideration

and it makes no difference even if the claim is ultimately found to

be without foundation. Hence, appellant being saved from the

prospects of protracted and uncertain litigation suffices as

consideration.

15. This proposition of law has been acknowledged with

advantage in “Thakur Madhosingh v. Jagdambalal and Anr.”

(AIR 1960 Rajasthan 237) wherein it has been held that the

abandonment of a dispute is a valid consideration and it makes no

difference if ultimately the claim is found to be without

foundation since on account of the compromise a party is saved

from the rigours of uncertain litigation.

16. In the matter before this court the act of the respondent

whereby he compromised and abandoned his claim against

the appellant in the criminal case registered against the

appellant at the instance of the respondent and thereby

allowed the appellant to earn a clean chit, avoid stigmatization

and escape the rigours of criminal law as also the consequent

alleviation of anxiety resulting from protracted criminal


RFA. No.90 of 2021 8

prosecution is what serves as consideration for the cheque in

question.

17. In “Muhammad Ameen v. Wali Khan” (2016 CLD 771) the

Sindh High Court has held “that the execution of a negotiable

instrument can only be for the purpose of clearing up or paying up

certain liability or consideration and which particular

consideration need not be referred or mentioned in or on the

negotiable instrument”. It has been held at paragraph No.11 that “I

would also like to make it clear that even if before execution of a

'negotiable instrument' the parties were under certain liabilities

through some written agreement, this would not be sufficient to

deprive one from resorting to the course provided by Order

XXXVII of the Code if it is established that earlier liabilities were

settled by execution of the 'negotiable instrument'. This is so for

the simple reason that execution of the 'negotiable instrument'

itself means to make an unconditional promise to pay a certain

sum on demand or at certain future date to the holder which is

always against some 'consideration'. If a contrary view is allowed

to hold the field it would not only frustrate the purpose and object

of 'the Act' but shall also fail the object of Order XXXVII of the

Code through which the law, at least, gives a hope for recovery of

the amount in a summary manner”.

18. In “Pahal Khan (Deceased) through L.Rs. v. Muhammad

Iqbal (Deceased) through L.Rs.” (2021 CLC 1668) it has been


RFA. No.90 of 2021 9

aptly noted that consideration does not always mean money but it

can also take several other forms including abstinence of one

party from taking any action. That abstinence or forbearance by

one person at the desire of another gives rise to corresponding

rights and clearly qualifies as consideration in terms of Section

2(d) of Contract Act, 1872. Similar observations have been

recorded in “Lal Bux v. Abdul Rasool through Legal Heirs and

another” (1994 CLC 138), as also in “Hafeez Ullah Khan and 2

others v. Al-Haj Chaudhri Barkat Ali and 2 others” (PLD 1998

Karachi 274).

19. In fact the High Court of Delhi in “K.S Bakshi and Amr v.

State and Amr” 146(2008) DLT 125 has held that consideration is

a very wide term and is not restricted to monetary benefit.

Consideration does not necessarily mean money in return of

money or money in lieu of service. Any benefit of some value

can be valid consideration. Hence the argument of the counsel

for the appellant that consideration necessarily involves

money or monetary benefit or something susceptible to

valuation in terms of money is a non-starter. The term

consideration signifies any abstinence, forbearance, benefit or

responsibility by the promisee at the instance of the promisor and

it is this arrangement which gives rise to the corresponding right.

20. Besides what has been noted above it is trite that according

to Section 118 of the Negotiable Instruments Act, 1881, until the


RFA. No.90 of 2021 10

contrary is proved, a presumption shall be drawn that the

negotiable instrument in question was a drawn for consideration

and the burden to rebut this presumption lies upon the party

arguing that the negotiable instrument has not been drawn for

consideration and that a bare denial of the passing of

consideration does not appear to be any defence. That something

probable has to be brought on record for getting the benefit of

shifting the onus of proof to the plaintiff. As aptly noted by the

Hon’ble Supreme Court of Pakistan in “Rab Nawaz Khan v.

Javed Khan Swati” (2021 CLD 1261), “ to disprove the

presumption the defendant has to bring on record such facts and

circumstances upon consideration of which the court may either

believe that the consideration did not exist . . . . . . . . . .”. This trite

position of law has also been recognized by a larger bench of the

Hon’ble Supreme Court of Pakistan in “Muhammad Aziz ur

Rehman v. Liaquat Ali” (2007 CLD 1542).

21. After the admission by the appellant about having issued

the cheque the onus to prove that the cheque was issued without

consideration was on him and he conspicuously remained unable

to discharge the onus of proof required in this respect. In addition

what is also important in the present matter is the fact that after

admitting the issuance of the cheque in question and taking up the

plea that he had returned the amount of money mentioned in the

cheque the appellant did not file any suit for cancellation of the
RFA. No.90 of 2021 11

cheque in question and did not make any effort to have it

rescinded or cancelled. This omission on the part of the appellant

is crucial and fatal to his case and attracts the law laid down by a

Division Bench of this Court in “Muhammad Nawaz v. Qazi

Muhammad Rashid” (2018 CLD 104) at paragraph No.11.

22. Dismissed.

(MUHAMMAD SHAN GUL)


JUDGE

“Gulraiz”

Approved for reporting

Judge
Gulraiz”

You might also like