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Petitioner: TRADING CORPORATION OF PAKISTAN (PVT) LTD VS Respondent: NAVEED HASAN SHAH
Court Name: Sindh High Court Judge(s): Aziz-ur-Rehman Title: TRADING CORPORATION OF PAKISTAN (PVT) LTD vs NAVEED HASAN SHAH Case No.: Suit No,459 of 1997 Date of Judgment:2014-03-26 Reported As: 2015 MLD 1269 Result: Application allowed
Judgment ORDER ' AZIZ-UR-REHMAN, J.---By means of this application under Order IX Rule 13 read with Sections 12[2] and 151, C.P.C. Bearing C.M.A. No,7006/2009, the defendant [means Judgment-debtor] has prayed for setting aside of the 'Judgment and Decree' dated 24-10-2007 passed 'ex parte' in Suit No,459 of 1997 [Rice Export Corporation of Pakistan v. Messrs Naveed Hussain Shah], mainly on the ground that the defendant at no stage of proceedings had any knowledge about the institution of the suit and/or passing of such judgment and decree in favour of the plaintiff [means Decree-holder], as the defendant besides was never served with the summons of the above suit', had no any knowledge about the institution of the suit and/or 'ex parte decree' passed therein on 15-12-2007. 2. Brief facts leading to the filing of above application [C.M.A. No,7006/2009] are as follows:-- 3. That the plaintiff corporation invited tender for handling of rice crop 1991-92, at their godown at Bin Qasim, Landhi and TPX Godown. In response, the tender submitted by the defendant partnership firm as handling agents at Karachi for handling of rice at Landhi godown was accepted by the plaintiff. 4. Consequently, between the plaintiff and defendant a contract dated 4th January, 1990 bearing No,RECP-5/M&M 1991-92, was signed and executed. The defendant was thus appointed as handling agent for handling the rice crop 1991-92, at Landi rice godown on the terms and conditions of the said contract. 5. In pursuance thereto the defendant was entrusted with a large quantity of rice of various qualities. Per clause 4(a) of the tender documents, from the date of acceptance, of tender, the period of contract was two years. But in the present case as alleged, on account of non-export of a considerable quantities of rice crop 1991-92, the plaintiff management however, extended the
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period of contract up-to 30-09-1995, though the services rendered and work performed, per plaintiffs assertions, throughout the contracted period was found un-satisfactory. 6. Nevertheless, the plaintiff corporation appointed an independent surveyor who in presence of parties, carried out 'physical verification' of the stocks and thereafter also submitted his report dated 25-9-1995. 7. Upon surfacing the shortage of 11,766.5158 M. Tons of rice, the defendant was called upon vide plaintiffs letter dated 23-11-1995 to explain the reasons for shortage of 11766.5158 M. Tons rice. 8. The defendant, upon failure to give reply or show reasons for the shortage so occurred, was consequently called upon to deposit Rs,75,257,276.51 as being cost of the quantities [i,e, 11,766.5158 M. Tons] having found short. Per plaintiff stand, the defendant besides submitting final account also admitted the shortage through his letter dated 26-6-1996. 9. The defendant, as being handling agent under the terms and conditions, is liable to render accounts of stocks entrusted to him under the terms and conditions of contract. Per plaintiffs version, the defendant is liable to pay the plaintiff a sum of Rs,75,257,276.51 as being the value of 11766.5158 M. Tons rice i,e, Was found shortage and remained un-counted for. 10. Resultantly, the plaintiff filed Suit No,459/1997 [Rice Export Corporation of Pakistan vs. Naveed Hussain Shah] for Accounts and Recovery of Rs,75,257,276.51 and Cost of Storage of Bardana with the following prayer:- (1) Decree for a sum of Rs,7,52,57,276. 51 against the defendant with interest and for mark up at 14% per annum from the date of suit till recovery plus cost of the Bardana found short at the time of final account. (2) In the alternatively the plaintiffs prays for a judgment and decree against the defendant to render true and faithfully account of the stocks of rice and bardana entrusted to defendants as mentioned in the plaint and to pass final decree for the amount ascertained on rendition of account. [Underlining is mine]. (3) Cost of the suit. (4) Any other relief which this Hon'ble Court may deem fit and proper in the circumstances of the case. 11. The number of suit allotted and appears on court fee/stamp paper is Suit No,459 of 1996 [Rice Export Corporation of Pakistan v. M/s. Naveed Hussain Shah]. The said Suit No, 459 of 1996 nonetheless, has been changed to Suit No,459 of 1997, without any explanation much-less, available on record. It is worth to note, suit was filed in court, on 12-12-1996. 12. Per first 'diary sheet' of Additional Registrar [U.S.] dated 29-5-1997, summons to the defendant by bailiff and registered post A/D were not issued as the 'process fee' and 'registration charges' not deposited by the plaintiff. On the plaintiffs application under section 148, C.P.C., nonetheless, time was extended for issuing of summons for 7-10-1997. Per diary sheet of Additional Registrar [U.S.], the summons issued to the defendant through 'bailiff, 'registered post' A/D, and cover-in-hand' for 7- 10-1997, but the same were returned unserved. Per bailiff report dated 6-10-1997, the defendant had shifted from the address given. The summons by registered post A/D, cover-in-hand could not be issued as no one turned up to collect the process from the office. Again, from the 'diary sheet' of Additional Registrar [O.S.] dated 9-12-1997, it transpires that 'fresh summons' issued to the defendant had also returned unserved. Per bailiffs report dated 9-12-1997 the premises was found locked. 13. Fresh summonses thereafter were issued 'for 19-2-1998, however, again could not be issued. Summons thereafter issued for 23-11-1998 but the same returned un-served as the 'premises' was found locked. Summons for 20-8-1998 could not be issued as 'process fee' was not paid. However, 2 weeks' time was allowed for issuance of summons for 15-10-1998. From the diary sheet of Additional Registrar [O.S.] dated 15-10-1998, it appears, that 'fresh summons' issued to the defendant again
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returned un-served as the office, was found locked. Per diary sheet of Additional Registrar [0.S.] dated 8-12-1998 and 9-2-1999 summons could not be issued as 'process fee' was not paid. From the diary sheet of Additional Registrar [O.S.] dated 13-4-1999 it appears, that summons issued to the defendant returned un-served as the office was found locked. Per diary sheet of Additional Registrar [O.S.] dated 27-5-1999 and 24-8-1999 summonses were not issued to the defendant as 'process fee' was not paid. 14. In view of the above and due to non-payment of 'process fee' time and again the plaint was consequently struck off on 24-8-1999, under Rule 128 of Sindh Chief Court Rules [Original Side]. The plaintiff thereafter, on 11-2-2004, [more than 4 years], nevertheless, filed an application under Rule 129, SCCR [CMA No,4037 of 2005] with a prayer that order dated 24-8-1999 be set aside and plaint be restored in its 'original position' with condonation of delay, if any. The aforesaid application bearing C.M.A. No,4037/2005 was also supported by the affidavit of one Muhammad Atiq son of late Muhammad Laiq Khan. 15. It is worth to note that aforesaid application bearing C.M.A. No,4037 of 2005 was granted by the Addl. Registrar (0.S.) however, without issuing any notice to the defendant. The plaint was thus restored to its 'original position' after about 5 years [i,e, on 22-9-20051. Diary sheet of Additional Registrar [0.S.1 dated 22-9-Z005, shows that the summons issued to the defendant returned un- served with the endorsement that the office of defendant is not in existence. The plaintiff, however was directed to produce the 'confirmation report'. Summons in the meantime, was repeated through bailiff for 11-11-2005. 16. From the diary sheet of Additional Registrar [O.S.] of 10th November, 2005, it reveals that the summons issued for 11-11-2005 returned un-served as the office was 'found locked'. Under the said order, it was noted down that 'the plaintiff has not yet produced 'confirmation report of TCS'. Nonetheless, summonses were again repeated through 'bailiff, 'registered A/D' and 'courier' for 10-1- 2006 despite the fact that office was, time and again, found locked/closed. 17. From diary sheet of Additional Registrar [O.S.] dated 27-1-2006 it appears, that the summons issued to the defendant returned un-served as the office was found 'locked'. Under circumstances, the plaintiff was directed to supply 'fresh address' of the defendant in a week. In the meantime summonses were repeated for 21-3-2006. Per diary sheet of Additional Registrar [U.S.] dated 21-3- 2006, summons could not be issued to the defendant as cost was again not paid. Further under the same order the plaintiff's application under "Order V, Rule 20, C.P.C. For serving the defendant, by way of publication, was granted and plaintiff was directed that publication be made in the Daily 'JANG' Urdu, Karachi for 4-5-2006. 18. From the diary sheet of Additional Registrar [O.S.] dated 4-5-2006 it appears, that the publication was not issued as cost was not paid. However, for paying cost 1 week time was granted for issuance of publication for 2-6-2006. Per diary sheet of 2-6-2006 of Additional Registrar [0.S.], the summonses inter alia through publication, were published in daily 'JANG' Urdu, Karachi of 16-5- 2006. Per Addl. Registrar [O.S.] diary of 2nd June, 2006, service upon defendant was held 'good'. On 21-8-2006 the defendant was declared 'ex parte'. 19. The 'un-signed order' dated 21-8-2006 and 'late diary' 21-8-2006 read as follows:-- "21-8-2006 Service of C.M.A. No,4037/2005 is carried out through publication in 'Daily Jang' dated 16-5-2006. To come up for hearing of the above application as well as application for limitation. Adjourned to 24-8-2006"
"Late Diary 21-8-2006
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Before the order could be signed, Mr. Ashfaq Hussain, appeared in the chamber and after seeking excuse has submitted that actually CMA No,4037/05 has already been allowed by Addl. Registrar vide his order dated 20-6-2005 and after restoration of suit service was ordered for defendant, which was effected upon it in terms of Addl. Registrar's diary dated 2-6-2006. The actual position disclosed by learned counsel is being verified by the diaries of suit. In the circumstances, the case to proceed ex parte against the defendants. Adjourned to 24-8-2008." [Underlining is mine]. 20. Thereafter, per order dated 29-11-2006 the plaintiffs request for filing of 'affidavit-in-ex parte proof was granted and plaintiff was directed to file 'affidavit-in-ex-parte proof' within a period of 2 weeks. The plaintiff in compliance with order dated 9-11-2006, filed the 'affidavit-in-ex parte proof' of one Muhammad Atiq Khan son of late Muhammad Liaq Khan on 13-12-2006 which is available on record. 21. On 7-3-2007, plaintiff counsel sought time for filing application for amendment in the title of plaint. Such application under section 151, C.P.C. [CMA No,2092/2007] was filed on 7-3-2007. The prayer sought in the aforesaid application reads as follows:- "It is prayed that on the consideration of the facts disclosed in the accompanying affidavit, this Honourable Court may be pleased to allow the plaintiff to file amended title in the above captioned matter as by the order dated 19-1-2001, passed by this Honourable Court in J.M. Petition No,36/1999, the plaintiff Rice Export Corporation of Pakistan stood dissolved being amalgamated in Trading Corporation of Pakistan and therefore, now trading corporation of Pakistan shall replace Rice Export Corporation of Pakistan" [Underlining is mine]. 22. On 30-5-2007, when C.M.A. No,2092 of 2007 came up before the court, notice was ordered on the said application. From record, it reveals, that notice, indeed, was issued to the defendant for 29-8-2007. However, per bailiff report of 22-6-2007 notice remained un-served. Per bailiffs report the office is closed for last 10 years. On 29-8-2007, when the case came up before the Court, the following order on C.M.A. No,2092 of 2007 [application for substitution of Rice Export Corporation of Pakistan (Pvt.) Ltd., by Trading Corporation of Pakistan (Pvt.) Ltd., as plaintiff in Suit No,459 of 1997] was passed:- "It seems that defendant has been served, but it is not contesting the suit nor it has appeared to contest this application. The application of the plaintiff has merely sought substitution of the name of Trading Corporation of Pakistan in place of the name of Rice Export Corporation of Pakistan. The amendment in the title of the plaint is formal. The application is allowed. Let the amended title of the plaint be filed within two days. " 23. Manifestly the above application was also granted without service of notice on the defendant in accordance with order of 30-5-2007 and despite the fact that the office of defendant was found closed for the last 10 years. 24. Thereafter on 24-10-2010, the suit was decreed by awarding the claim of Rs,75,257,276.51 plus markup @14% per annum. For and regarding justification of 'ex-parte decree', para 6 of the judgment dated 24-10-2007, being relevant is reproduced as hereinbelow:- "6. On account of the failure of the defendant to come forward and contest the proceedings, this Court ordered that the suit to proceed ex-parte against the defendant and directed the plaintiff corporation to file affidavit in ex-parte proof The claim of the plaintiff corporation has gone unchallenged. Therefore there was no other alternative left but to accept plaintiff's version and decree this suit in the sum of Rs,7,52,57,276.51 as claimed alongwith mark up at the rate of 14% per annum recoverable from the defendant from the date of the contract i,e, 24-11-1991 till the recovery of the entire decretal amount".... [Underlining is mine]. 25. Most of the remaining part of the judgment pertains to the attitude and role played by the plaintiff vis-a-vis shortage of 11,766.5158 M. Tons of rice. Upon passing of the judgment and decree
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dated 24-10-2007, the plaintiff assailed the same in High Court Appeal No,07/2003 [Trading Corporation of Pakistan v. Messrs Naveed Hussain Shah]. On 7-2-2008, when the said High Court Appeal came-up before the Hon'ble Divisional Bench of this Court by consent the same was disposed of. 26. Through the instant application [C.M.A. No,7006 of 2009] filed on 17-6-2009, the defendant is seeking setting aside of the judgment and decree, mainly on the ground that the institution of suit and/or passing of judgment and decree was/were not in knowledge of the defendant and the defendant came to know when notice regarding Execution Application No,41/2008 [Trading Corporation of Pakistan v. Naveed Hussain Shah], was published in daily 'JANG' Urdu, Karachi, on 2- 6-2009. The defendant, thereafter made inquiries and ultimately found that the Suit No,459/1997 [now Trading Corporation of Pakistan (Pvt.) Ltd. v. Messrs Naveed Hussain Shah] had already been decreed on the basis of publication of summons in newspaper sometime in May, 2006. Per averments, the defendant remained abroad from January, 2006 to the end of April, 2006. Further the plaintiff avoided to file the 'fresh address' of defendant in compliance with order dated 27-1- 2004 passed by Addl. Registrar (O.S.) though the 'fresh address' was not only available but was also known to the plaintiff i,e, in Suit No,196 of 1996 pending adjudication before the High Court. 27. Per defendant, the plaintiffs conduct and its manipulations are manifested by the fact, that the plaint in the above suit was 'struck off' on 24-8-1999 under Rule 128 SCCR [O.S.], but the plaintiff did not file any application for recalling of the aforesaid order passed by the Addl. Registrar (O.S.) until 11-2-2004. As such the plaintiff acquiesced in the dismissal of the suit. The revival of the suit after more than 4-1/2 years by the learned Additional Registrar (O.S.) and that too without issuing any notice to the defendant, indeed, was not justified or otherwise, maintainable. The application [C.M.A. No,4037 of 2005] so filed, was evidently beyond reasonable time limit. The judgment and decree thus passed by the Court, per learned counsel, besides mis-conceived was obtained fraudulently by suppressing the real and true facts. 28. In rebuttal of the application [C.M.A. No,7006 of 2009] for setting aside of the judgment and decree dated 24-10-2007, the plaintiff through filing of a 'counter affidavit' denied the assertions. Per plaintiffs stand, summons/notices, no doubt, were repeatedly sent on the address available on record but the defendant failed and/or avoided the service. As a last resort, the defendant was served through publication in daily 'JANG' Urdu, Karachi of 16-5-2006. Per plaintiffs version, notice of Execution Application No, No,41/2008 [Trading Corporation of Pakistan v. Naveed Hussain Shah], published in daily 'JANG' on 2-6-2009 was read by the defendant but surprisingly he did not read the publication of summons in daily JANG of 16 May, 2006 regarding Suit No,459 of 1997 [now Trading Corporation of Pakistan (Pvt.) Ltd., v. Messrs Naveed Hussain Shah). 29. On 5-3-2014, when above matter came up before me I heard Mr. H. A. Rehmani, learned counsel for the defendant and Syed Ashfaq Hussain Rizvi, learned counsel for the plaintiff and with their valuable assistance also gone through the record available before me. 30. Mr. Ashfaq Hussain, learned counsel for the plaintiff at the very outset, raised a preliminary objection to the effect that the judgment and decree passed by the learned Single Judge has now been confirmed, no doubt, with some modifications by the Division Bench of this court vide judgment of 7-2-2008 passed in H.C.A. No,07 of 2008 [Trading Corporation of Pakistan v. Naveed Hussain Shah], as such the Single Bench of this court, now cannot set aside the judgment and decree of 24-7-2007 much-less as prayed for by the defendant through the instant application [C.M.A. No,7006 of 2009]. 31. In contra, Mr. H. A. Rehmani, learned counsel for plaintiff while repelling the contention of the learned counsel for the plaintiff, contended in vehemence that order passed on 7-2-2008 by the learned Division Bench of this court in HCA No,07 of 2008 [Trading Corporation of Pakistan v. Naveed Hussain Shah] does nothing with the merits of the case. No doubt, this court has
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jurisdiction to entertain the application under Order IX Rule 13, C.P.C. [C.M.A. No,7006 of 2009] and also decide the same on its own merits. 32. For proper appreciation of the preliminary objection so raised it would be advantageous to reproduce here-in-below order passed by the learned Division Bench in HCA No,07 of 2008 [Trading Corporation of Pakistan (Pvt.) Ltd., v. Naveed Hussain Shah]. Order dated 7-2-2008 reads as follows:-- "Through this appeal, the appellant has challenged the observations of the learned Judge in judgment passed in Suit No,459/1997. Learned counsel for the appellant submits that without recording evidence the learned single Judge has ordered for initiating appropriate disciplinary and criminal action against the concerned officer of the appellant corporation which could not be done as there was no evidence. Learned D.A.G and A.A.G both are unanimous by stating that in the given circumstances the appellant corporation have no grievance and should not have filed appeal as the concerned officers only could be effected and since the observation of the learned single Judge has been given keeping in view the factual position being reflected from the letters of the appellant itself as the officers were negligent as stock of the rice was not checked for years till 1995. They submit that observation is quite correct. After hearing learned counsel to some extent, the learned counsel for the appellant agreed that the observations given by the learned single Judge may be conditioned that some inquiry may be initiated to which both the learned State counsel have no objection. In such a situation, it is ordered that prior to acting on the directions of learned single Judge given in the judgment dated 24-10- 2007 in Suit No,459/1997, a preliminary inquiry at departmental level be conducted keeping in view the factual position as well as the observations of the learned single Judge and thereafter action as proposed in the judgment be initiated so that it should be warning and deterrent factors for others in similar circumstances. ' With the above observations, this appeal is disposed of " 33. Bare perusal of the above, would show that the High Court Appeal No,7 of 2008 [Trading .Corporation of Pakistan (Pvt.) Ltd., v. Messrs Naveed Hussain Shah] was only in respect of the observations made by the learned Single Judge against the conduct, deaf slumber and lethargy prevailed over the management of the plaintiff corporation regarding shortages of 11,766.5158 M.Tons of rice and did nothing as far as 'ex parte decree' against defendant was concerned. In view of this position, I hold that notwithstanding order passed on 7-2-2008 by the learned Division Bench of this court in H.C.A. No,7 of 2008, this court, of course, has jurisdiction to entertain the application [C.M.A. No,7006 of 2009] and also decide the same on its own merits. The observations made by the learned Single Judge and confirmed/subjected to condition per order dated 7-2-2008 passed by the Hon'ble Division Bench of this court shall, however, remain intact and binding. 34. In contra and pro the parties have also filed 'counter affidavit' and 'affidavit-in-rejoinder' by exchanging copies thereof. In 'affidavit-inrejoinder' not only contents of 'the 'counter affidavit' have been denied forcefully but the contents of the application under Order IX Rule 13 and its supporting affidavit have also been reiterated. 35. While, arguing the case on merits, Mr. H. A. Rehmani, learned counsel for the defendant [Judgment-debtor] vehemently argued that neither the defendant was ever served with summons nor with any notice up-till 2-6-2009 i,e, when a public notice of Execution No,41 of 2008 [Trading Corporation of Pakistan (Pvt.) Ltd., v. Naveed Hussain Shah] was published in daily JANG', Urdu, Karachi. The defendant, at no stage had any knowledge regarding institution of Suit No,459 of 1997 [now Trading Corporation of Pakistan (Pvt.) Ltd., v. Messrs Naveed Hussain Shah] and/or 'ex parte decree' passed on 24-10-2007. Per Mr. H. A. Rehmani, despite having knowledge through the bailiff reports about locking/closure of the defendant's office the plaintiff did not care rather avoided the providing of the 'fresh address' of the defendant. Per learned counsel though it was available with
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the plaintiff. In this regard reference was made to Suit No,196 of 1996 pending adjudication before this court. Not only this, per learned counsel, on several occasions summons could not be issued as cost/process fee was not paid by the plaintiff. 36. Mr. H. A. Rehmani, argued in vehemence, that plaint 'struck off' on 24-8-1999 under Rule 128 of SCCR [O.S.] should not have been recalled/set aside much-less after about 5 years by Addl. Registrar [0.S.] on the application under Rule 129 of SCCR [O.S.] filed on 11-2-2004 [i,e, more than 4- 1/2 years]. Moreover, it was granted without any notice. Such restoration of the plaint to its 'original position' besides evidently beyond reasonable time is not justified under the law of natural justice. 37. Per Mr. H.A Rehmani, learned counsel for defendant, the decree passed in suit 459 of 1997 [now Trading Corporation of Pakistan (Pvt.) Ltd., v. Messrs Naveed Hussain Shah] is liable to be set aside in view of the glaring illegalities committed and evident from the record.. The defendant, under circumstances, be allowed to contest the suit on merits. The ex parte judgment and decree under which the defendant was burdened with heavy and frivolous amount, of course, is liable to be set aside. Per learned counsel, it is in consonance with the dictate of justice to allow the application [C.M.A. No,7006 of 2009]. Manipulations of the plaintiff otherwise, will become triumphant and the defendant shall financially be ruined on the basis of an 'ex parte decree' which, no doubt, is a nullity in the eye of law. 38. In support of his contention Mr. H. A. Rehmani, learned counsel for the defendant has placed reliance on the following case laws:-- (a) 1985 SCMR 1228 [Muhammad Anwar, Advocate v. Shaikh Abdul Haq] (b) 2011 SCMR 1745 [Messrs China Beijing Corporation v. Ahmad Bakhsh Construction Co., and others] (c) PLD 1993 Kar. 676 [Mst. Aliya Masood v. Mrs. Mussarat Musaver and others] 39. In rebuttal, Mr. Ashfaq Hussain Rizvi, learned counsel for plaintiff [Decree-holder] argued that the judgment and decree passed on…
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