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Petitioner: PAK PETROCHEMICAL INDUSTRIES PVT. LTD. through Chief Executive- VS Respondent: Syed JUDGMENT
Court Name: Sindh High Court Judge(s): Aziz-ur-Rehman Title:PAK PETROCHEMICAL INDUSTRIES PVT. LTD. through Chief Executive- vs Syed
JUDGMENT
Reported As: 2014 CLC 837, 2014 CLD 519 Result: Suit decreed Judgment JUDGMENT ' AZIZ-UR-REHMAN, J.---The instant suit has been filed by the plaintiff through its Chief Executive viz. Syed Ahsan Ali son of Syed Mumtaz Ali for seeking recovery of Rs,8,888,253 [Rupees Eight Million, Eight Hundred Eighty Eight Thousand, Two Hundred and Fifty Three only], damages and mesne profit against the defendant with the following prayers:-- (a) To declare that the defendant has purchased the material from the plaintiff on credit basis against which post-dated cheques were issued in favour of the plaintiff; which were bounced due to insufficient funds. (b) To declare that the defendant is liable to pay the amount of Rs,8,888,253 to the plaintiff against the material which the defendant had already purchased from the plaintiff on credit basis. (c) To declare that the defendant is liable to pay 18% markup of the entire amount from the date, the defendant purchased the material on credit basis from the plaintiff till the suit realization. (d) To pass judgment and decree directing the defendant to pay the damages amounting to Rs,50 millions to the plaintiff towards mental torture, agony and physical discomfort sustained by the plaintiff due to the non-fulfilment of the legal obligation on the part of the defendant. (e) To declare that the defendant has committed an offence under section 489-F, P.P.C. For which he is liable to be prosecuted under the law. (f) Any other/further or better relief as this Hon'ble Court may deem fit in the circumstances of the case. (g) To award the cost of the suit to the plaintiff. 2. Precisely the relevant facts leading to the above prayers are as follows:--
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3. Per averments made in the plaint, plaintiff is a registered company under Companies Ordinance, 1984 having its head office at Polymer House, Survey No,136, Main National Highway, Karachi and doing business of manufacturing of polystyrene Resin under Sales Tax Registration No,12-03-3903- 001-19 in the entire country. The defendant per assertion, is also doing business under the name and style of Syed Trading Corporation having its office at Plot No,ST-8A, Shop No,9, Imambargah SKN Colony, Karachi, under Sales Tax Registration No,17-503900-010-46. Per plaintiffs assertion, defendant usually used to purchase materials of General Purpose. Polystyrene (GPPS) and High Impact Polystyrene (HIPS) on credit basis from the plaintiff-company. 4. Per averments, the defendant was one of its good customers who always used to purchase the materials on credit basis. In the process of business, the defendant often used to issue post-dated cheques. Being a good client, the plaintiff never hesitated to sell goods to the defendant on credit basis because of good business relationship with the plaintiff. 5. The defendant nevertheless, regarding purchase of materials used to issue cheques, being subject-matter of the present suit, took advantage and let the various cheques dishonoured on presentation before the drawee Bank [Habib Metropolitan Bank Ltd.] due to insufficient funds. These cheques issued in favour of the plaintiff were in consideration of prices of materials purchased by the defendant from the plaintiff. 6. The details of materials under the sales tax-cum commercial invoices purchased by the defendants are given as below:-- S#Date Invoice No.Description of GoodsUnit Prize 1.6-11-2007HI-00246HIPS Prime Grade 113 2.10-11-2007GP-00588GPPS Prime Grade 109 3.15-11-2007GP-00606GPPS Prime Grade 107 4.20-11-2007GP-00629GPPS Prime Grade 107 5.1-12-2007GP-00680GPPS Prime Grade 107 6.1-12-2007H1-00291HIPS Prime Grade 111 7.5-12-2007GP-00707GPPS Prime Grade 107 8.5-12-2007GP-00702GPPS Prime Grade 109 9.14-12-2007GP-00745GPPS Prime Grade 109 10.18-12-2007HI-00323HIPS Prime Grade 111 11.2-1-2008GP-00778GPPS Prime Grade 106 12.21-1-2008HI-00371HIPS Off Grade 95 13.21-1-2008GP-00845GPPS Off Grade 91 14.25-1-2008GP-00860GPPS Off Grade 91 15.29-1-2008GP-00872GPPS Prime Grade 108 16.2-2-2008GP-00888GPPS Off Grade 91 17.2-2-2008GP-00887GPPS Off Grade 91 Value excluding SED and Sales TaxSpecial Excise Duty @ 1%Sales Tax @ 20%Value including SED and Sales Tax 282500 2825 56500 341825 272500 2725 54500 329725 267500 2675 53500 323675 401250 4012.50 80250 485512.50 401250 4012.50 80250 485512.50
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277500 2775 55500 335775 133750 1337.50 26750 161837.50 272500 2725 54500 329725 272500 2725 54500 329725 69375 693.75 13875 83943.75 66250 662.50 13250 80162.50 237500 2375 47500 287375 341250 3412.50 68250 412912.50 113750 1137.50 22750 137637.50 675000 6750 135000 816750 1189825 11898.25 237965 1439688.25 2361450 23614.50 472290 2857354.50 9239136.05 7. Per assertions, the plaintiff has paid sales tax @ 20% to the Sales Tax Department in accordance with Sale Taxcum-Commercial Invoices. Such payment made is quite evident from the sales tax return challans. The materials purchased by the defendant from the plaintiff as per chart above is in the sum of Rs,92,39,136.05 [Ninety Two Lacs Thirty Nine Thousand One Hundred Thirty Six and Paisas Five only]. For and in consideration of materials purchased by the defendant on credit basis, several post-dated cheques issued in favour of plaintiff, of course, were coupled with the assurance that the cheques on presentation to the drawee Bank would be encashed on the specified dates of the cheques. The various cheques issued in favour of the plaintiff were duly signed by the defendant. 8. The details of dishonoured cheques and return memos of drawee Bank i,e, Habib Metropolitan Bank Ltd. Are detailed as below:-- Sr. No. Cheque No.Date AmountReturned memo. and date (1) HMC 2944368324-11- 2007Rs.2,00,000 (Rupees two lac only) 6-2-2008 (2) HMC 2944368426-11- 2007Rs.2,00,000 (Rupees two lac only) 6-2-2008 (3) HMC 2944368527-11- 2007Rs.2,00,000 (Rupees two lac only) 6-2-2008 (4) HMC 2944368829-11- 2007Rs.2,00,000 (Rupees two lac only) 6-2-2008 (5) HMC 2944368630-11- 2007Rs.2,00,000 (Rupees two lac only) 6-2-2008 (6) HMC 2944368730-11- 2007Rs.2,00,000 (Rupees two lac only) 6-2-2008 (7) HMC 294456028-12- 2007Rs.164862 (Rupees one lac sixty fourthousand eight hundred sixty two and fifty paisa)6-1-2008 (8) HMC 294436928-12- 2007Rs.164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)6-2-2008 (9) HMC 2944369310-12- 2007Rs.170912.50 (One lac seventy thousand nine hundred twelve and fifty paisa)6-2-2008
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(10) HMC 2944560414-12- 2007Rs.170912.50 (One lac seventy thousand nine hundred twelve and fifty paisa)6-2-2008 (11) HMC 2944561618-12- 2007Rs.245025 (Rupees two lac forty five thousand and twenty five only)6-2-2008 (12) HMC 2944369818-12- 2007Rs.170912.50 (One lac seventy thousand nine hundred twelve and fifty paisa)6-2-2008 (13) HMC 2944561419-12- 2007Rs.170912 (One lac seventy thousand nine hundred and twelve only)6-2-2008 (14) HMC 2944560620-12- 2007Rs.164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)6-2-2008 (15) HMC 2944560722-12- 2007Rs.164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)6-2-2008 (16) MHC 2944560824-12- 2007Rs.164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)6-1-2008 (17) HMC 2944561129-12- 2007Rs.164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)6-1-2008 (18) HMC 294456243-1- 2008Rs.164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)15-1-2008 (19) HMC 294456124-1- 2008Rs.164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)7-2-2008 (20) HMC 294456255-1- 2008Rs.164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)16-1-2008 (21) HMC 294456268-1- 2008Rs.170912.50 (One lac seventy thousand nine hundred twelve and fifty paisa)11-1-2008 (22) HMC 2944562711-1- 2008Rs.170912.50 (One lac seventy thousand nine hundred twelve and fifty paisa)7-2-2008 (23) HMC 2944563613-1- 2008Rs.164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)7-2-2008 (24) HMC 2944562814-1- 2008Rs.164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)7-2-2008 (25) HMC 2944562916-1- 2008Rs.164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)7-2-2008 (26) HMC 2944563017-1- 2008Rs.164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)7-2-2008 (27) HMC 2944563119-1- 2008Rs.170912.50 (One lac seventy thousand nine hundred twelve and fifty paisa)7-2-2008 (28) HMC 2944564324-1- 2008Rs.287,375 (Rupees two lac eighty seven thousand three hundred and seventy five only)7-2-2008 (29) HMC 2944563226-1- 2008Rs.170912.50 (One lac seventy thousand nine hundred twelve and fifty paisa)4-2-2008 (30) HMC 294456331-2- 2008Rs.170912.50 (One lac seventythousand nine hundred twelve and fifty paisa)6-2-2008 (31) HMC 294456472-2- 2008Rs.164863 (Rupees one lac sixty four thousand eight hundred and sixty three only)6-2-2008
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(32) HMC 294456465-2- 2008Rs.164862 (Rupees one lac sixty four thousand eight hundred and sixty two only)7-2-2008 (33) HMC 294456456-2- 2008Rs.164863 (Rupees one lac sixty four thousand eight hundred and sixty three only)7-2-2008 9. On presentation, the aforementioned cheques were bounced for want of funds and/or due to insufficient funds. Per assertions, upon such dishonour of cheques, the plaintiff called upon the defendant and apprised him about dishonouring of the cheques. Such position, was not only acknowledged but also apologized. Per averments, the apology so sought by the defendant was also accepted, on the defendant's assurance, that the amounts of aforesaid cheques would be paid by the defendant to the plaintiff as promised. 10. All the cheques, presented before the drawee bank on specified dates stood bounced due to in- sufficient funds. Despite requests, the defendant, nevertheless remained ridiculous and passive in performing his promises made in respect of encashment of cheques. The cheques presented for encashment, despite assurance, remained bounced/ dishonoured due to non-availability of sufficient funds. 11. Apart from the above, against purchase of more materials, on credit basis, the defendant in consideration of the value thereof issued twelve more cheques which are detailed as below:-- S. No.Cheque No. Date Amount 1. HMC 294456448-2-2008Rs.164862 2. HMC 2944564812-2-2008Rs.164862 3. HMC 294456499-2-2008Rs.164863 4. HMC 2949815115-2-2008Rs.164863 5. HMC 2949815219-2-2008Rs.164863 6. HMC 2949815321-2-2008Rs.164863 7. HMC 2949815423-2-2008Rs.164863 8. HMC 2949815526-2-2008Rs.164863 9. HMC 2948715628-2-2008Rs.164863 10.HMC 2949815729-2-2008Rs.164863 11. HMC 294981583-3-2008Rs.164863 12.HMC 294981594-3-2008Rs.164863 12. Keeping in view the past good relationship between the parties, no F.I.R. Was lodged and/or criminal proceedings initiated vis-a-vis dishonoured cheques. The defendant was once again apprised about the dishonouring of the cheques on presentation before the drawee bank viz. Messrs Habib Metropolitan Bank Ltd. In response, per averments, the defendant besides extending his apology had sought time for liquidating the outstanding dues payable to the plaintiff. 13. The defendant, indeed, thereafter has paid Rs,200,000 [Rupees Two Hundred Thousand only] through two pay orders each amounting to Rs,100,000 [Rupees One Hundred Thousand only]. The defendant apart from the above, has also paid some amount in cash. Total amount thus paid is amounting to Rs,350,882.75 [Rupees Three Hundred Fifty Thousand, Eight Hundred Eighty Two and Paisas Seventy Five only]. For the balance outstanding amount, the defendant made promise to pay the same within a period of one month [i,e, up to 10-3-2010]. But notwithstanding such promise(s) the defendant failed and/or avoided to pay the lawful outstanding dues to the plaintiff. 14. The plaintiff, nonetheless has afforded ample opportunities to defendant for the payment of the outstanding amounts but all efforts remained fruitless. Consequently, a legal notice dated 3-4- 2010 was sent by the plaintiff through his counsel whereby the defendant was called upon to pay the outstanding amount of Rs,8,888,253 [Rupees Eight Million, Eight Hundred Eighty Eight Thousand,
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Two Hundred and Fifty Three only] along with 18% markup within 7 days. Notice sent to the defendant though was replied but payment was not made and/or avoided by raising pseudo pleas. Per averments, the cause of action has accrued in favour of the plaintiff on 6-11-2007 and also on other dates as mentioned in para 16 of the plaint. Hence the instant suit. 15. Upon filing of the suit, summonses were issued to the defendant from time to time, however, the defendant remained unserved. From the. 'diary sheet' of the Additional Registrar (O.S.) of 4-10-2011, it reflects that service on the defendant was effected inter a/ia through publication in the daily 'JANG' Urdu Karachi dated 6-9-2011. Under the same order of Additional Registrar (O.S.), service was held good upon the defendant. 16. Notwithstanding, service the defendant failed, and/or avoided to file any written statement. Consequently, on 10-10-2011 when the case came-up before the court the following order was passed:-- "10-10-2011. Mr. Junaid M. Siddiqui, Advocate for the plaintiff The defendant has been served through publication in Daily Jang, Karachi dated 6-9-2011 as well as all other modes. Service upon the defendant was held good on 4-10-2011 by the Additional Registrar, but no one has appeared on behalf of the defendant. Consequently, the defendant is hereby declared ex parte." 17. The matter thereafter, being posted for 'final disposal'. Ultimately, vide order dated 27-9-2012, the plaintiff was directed to file 'affidavit-in-ex parte proof of plaintiffs witness. Upon filing 'affidavit-in ex parte proof on 4-10-2012 'examination-in-chief of plaintiffs witness Syed Haider Ali son of Insaf Ali [Exh.P.W.1] was recorded. The witness [P.W.1] in his 'deposition' produced in his 'affidavit-in ex parte proof as Exh.P.W.1/3, board resolution as Exh.P.W.1/4. The exhibits numbers of 33 dishonoured cheques and 33 return memos thereof issued by the drawee Bank are detailed with Exhibits numbers are as follows:-- Sr.No. Cheque No.Date Amount Exh.Returned memo. and dateExh. (1) HMC 2944368324-11- 2007Rs. 200,000 (Rupees two lac only) P.W.1/56-2-2008 1/6 (2) HMC 2944368426-11- 2007Rs. 200,000 (Rupees two lac only) 1/7 6-2-2008 1/8 (3) HMC 2944368527-11- 2007Rs.200,000 (Rupees two lac only) 1/9 6-2-2008 1/10 (4) HMC 2944368829-11- 2007Rs. 200,000 (Rupees two lac only) 1/11 6-2-2008 1/12 (5) HMC 2944368630-11- 2007Rs. 200,000 (Rupees two lac only) 1/13 6-2-2008 1/14 (6) HMC 2944368730-11- 2007Rs. 200,000 (Rupees two lac only) 1/15 6-2-2008 1/16 (7) HMC 294456028-12- 2007Rs. 164826.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)1/17 6-1-2008 1/18 (8) HMC 294436928-12- 2007Rs. 164826.50 (Rupees one lac sixty four thousand eight hundredsixty two and fifty paisa)1/19 6-2-2008 1/20
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(9) HMC 2944369310-12- 2007Rs. 170912.50 (One lac seventy thousand nine hundred twelve and fifty paisa)1/21 6-2-2008 1/22 (10) HMC 2944560414-12- 2007Rs. 170912.50 (One lac seventy thousand nine hundred twelve and fifty paisa)1/23 6-2-2008 1/24 (11) HMC 2944561618-12- 2007Rs. 245025 (Rupees two lac forty five thousand and twenty five only)1/25 6-2-2008 1/26 (12) HMC 2944369818-12- 2007Rs. 170912.50 (One lac seventy thousand nine hundred twelve and fifty paisa)1/27 5-2-2008 1/28 (13) MHC 2944561419-12- 2007Rs. 170912.50 (one lac seventy thousand nine hundred twelve and fifty paisa)1/29 6-2-2008 1/30 (14) MHC 2944560620-12- 2007Rs. 164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)1/31 6-2-2008 1/32 (15) HMC 2944560722-12- 2007Rs. 164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)1/33 6-2-2008 1/34 (16) MHC 2944560824-12- 2007Rs. 164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)1/35 6-1-2008 1/36 (17) HMC 2944561129-12- 2007Rs. 164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)1/37 6-1-2008 1/38 (18) HMC 294456243-1- 2008Rs. 164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)1/39 15-1-2008 1/40 (19) HMC 294456124-1- 2008Rs. 164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)1/41 7-2-2008 1/42 (20) HMC 294456255-1- 2008Rs. 164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)1/43 16-1-2008 1/44 (21) HMC 294456268-1- 2008Rs. 170912.50 (One lac seventy thousand nine hundred twelve and fifty paisa)1/45 11-1-2008 1/46 (22) HMC 2944562711-1- 2008Rs. 170912.50 (One lac seventy thousand nine hundred twelve and fifty paisa)1/47 7-2-2008 1/48 (23) HMC 2944563613-1- 2008Rs. 164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)1/49 7-2-2008 1/50 (24) HMC 2944562814-1- 2008Rs. 164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)1/51 7-2-2008 1/52 (25) HMC 2944562916-1- 2008Rs. 164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)1/53 7-2-2008 1/54
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(26) HMC 2944563017-1- 2008Rs. 164862.50 (Rupees one lac sixty four thousand eight hundred sixty two and fifty paisa)1/55 7-2-2008 1/56 (27) HMC 2944563119-1- 2008Rs. 170912.50 (One lac seventy thousand nine hundred twelve and fifty paisa)1/57 7-2-2008 1/58 (28) HMC 2944564324-1- 2008Rs. 287,375 (Rupees two lac eighty seven thousand three hundred and seventy five only)1/59 7-2-2008 1/60 (29) HMC 2944563226-1- 2008Rs. 170912.50 (One lac seventy thousand nine hundred twelve and fifty paisa)1/61 4-2-2008 1/62 (30) HMC 294456331-2- 2008Rs. 170912.50 (One lac seventy thousand nine hundred twelve and fifty paisa)1/63 6-2-2008 1/64 (31) HMC 294456472-2- 2008Rs. 164863 (Rupees one lac sixty four thousand eight hundred and sixty three only)1/65 6-2-2008 1/66 (32) HMC 294456465-2- 2008Rs. 164862 (Rupees one lac sixty four thousand eight hundred and sixty two only)1/67 7-2-2008 1/68 (33) HMC 294456456-2- 2008Rs. 164863 (Rupees one lac sixty four thousand eight hundred and sixty three only)1/69 7-2-2008 1/70 18. Since, on behalf of defendant no one was present to cross-examine the plaintiffs witness [P.W.1], therefore, 'cross-examination' of P.W.1 to the defendant was marked as `Nil'. On the request of plaintiffs counsel, the plaintiff 's side of evidence was 'closed' as plaintiff did not wish to examine any other witness in support of the plaintiffs claim. 19. Besides, twelve other un-presented cheques drawn on Messrs Habib Metropolitan Bank Ltd. Have also been produced and exhibited as below:--- Sr.No.Cheque No. Date AmountExh. 1 HMC 294456448-2-2008Rs.164862P.W.1/71 2 HMC 2944564812-2-2008Rs.1648621/72 3 HMC 294456499-2-2008Rs.1648631/73 4 HMC 2949815115-2-2008Rs.1648631/74 5 HMC 2949815219-2-2008Rs.1648631/75 6 HMC 2949815321-2-2008Rs.1648631/76 7 HMC 2949815423-2-2008Rs.1648631/77 8 HMC 2949815526-2-2008Rs.1648631/78 9 HMC 2949815628-2-2008Rs.1648631/79 10 HMC 2949815729-2-2008Rs.1648631/80 11 HMC 294981583-3-2008Rs.1648631/81 12 HMC 294981594-3-2008Rs.1648631/82 20. I have heard Mr. Junaid M. Siddiqui, learned counsel for the plaintiff and also perused the record minutely with the able assistance of the learned counsel for the plaintiff. 21. 22. #TBS 23. (a) of consideration; that every negotiable instrument was made or drawn for consideration, and that every 24. #TBE
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25. Learned counsel for plaintiff Mr. Junaid M. Siddiqui, Advocate argued that despite 'service' the defendant has failed and/or avoided to appear and contest the matter. The averments made in the plaint and/or evidence led by the plaintiffs witness [P.W.1] have/has thus gone unrebutted/ unchallenged. Per learned counsel, the issuance of cheques in favour of the plaintiff is ex facie proof of the amounts outstanding in respect of materials purchased by the defendant from the plaintiff. Per learned counsel section 118(a) of the Negotiable Instrument Act [XXVI of 1881] creates a presumption in respect of Negotiable Instrument inter alia of its due execution for valuable consideration and acceptance. 26. Learned counsel for the plaintiff further contended that besides outstanding principal amount the plaintiff is also entitled for markup @ 18% per annum on the entire amount up to realization of the outstanding amounts. 27. Mr. Junaid M. Siddiqui, Advocate further contended that the cheques issued in favour of the plaintiff admittedly have been dishonoured for and on account of insufficient funds. The execution and issuance of cheques have not been denied by the defendant. Per learned counsel, the claim of the plaintiff in the instant suit is genuine and lawful. Arguing the case, the learned counsel further submitted that under section 118 of the Negotiable Instruments Act, 1881, [XXVI of 1881] negotiable instruments including cheque (s) made, drawn, accepted are presumed to be for consideration and to dispel such presumption the defendant is heavily required to discharge the onus of proof. Mr. Junaid M. Siddiqui, Advocate further urged that since the defendant has failed to come forward to raise any defence, therefore, per learned counsel the plaintiffs suit deserves to be decreed as prayed. Per learned counsel even the plaintiff is entitled for damages in the sum of Rs,50.00 million as prayed. 28. Heard arguments. Perused the record. Before proceeding further it would be appropriate to reproduce herein section 118 of the Negotiable Instruments Act, 1881 [XXVI of 1881] which runs as follows:--- "118. Presumption as to negotiable instruments.- -- Until the contrary is proved, the following presumptions shall be made:-- such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred, for consideration; (b) as to date; that every negotiable instrument bearing a date was made or drawn on such date; (c) as to time of acceptance; that every accepted bill of exchange was accepted within a reasonable time after its date and before its maturity; (d) as to time of transfer; that every transfer of a negotiable instrument was made before its maturity; (e) as to order of indorsement; that the indorsements appearing upon a negotiable instrument were made in the order in which they appear thereon; U) as to stamp; that a lost promissory note, bill of exchange or cheque was duly stamped; (g) that holder is a holder in due course; that the holder of a negotiable instrument is a holder in due course; provided that, where instrument has been obtained from its lawful owner, or from any person in lawful custody thereof by means of an offence or fraud, or has been obtained from the maker or acceptor thereof by means of an offence or fraud, or for unlawful consideration, the burden of proving that the holder is a holder in due course lies upon him." 25. A cheque being a special instrument is regulated under section 118 of the Negotiable Instruments Act, 1881. It is significant to note that special rules of evidence in terms of section 118 of the Negotiable Instruments Act is applicable that is: 'Until the contrary is proved, the following presumption shall be made:-- (a) Of consideration.---that every Negotiable Instrument was made or drawn for consideration and that every such instrument when it has been accepted, endorsed, negotiated or transferred,
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was accepted, endorsed, negotiated or transferred for consideration; (b) ' The presumption attached to a negotiable Instrument besides statutory is mandatory and any person who wishes to dispel it then, of course, he would be required to furnish proof/cogent evidence to the contrary. 26. In the case of Muhammad Sabir v. Khalil-ur-Rehman [Reported in 2002 CLD 1543 Pages 1548 and 1549], the court while dilating upon the presumption attached to Negotiable Instruments Act under section 118 of the Negotiable Instruments Act, 1881 [XXVI of 1881] observed as follows:-- "The contention of the learned counsel for the appellant that the Promissory Note, was not executed on 24-5-1982 but on a date 6-10-1981. Such contentions cannot be sustained for more than one reason, firstly under section 118 of the Negotiable Instruments Act, presumption is attached to a Negotiable Instrument, as to receipt of consideration, date of execution, time of receipt of consideration, date of execution, time of acceptance, time of transfer, order of endorsement, as to stamp and holder in due course are presumed unless, contrary is proved. It is…
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