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Official Citation: 2026 LHC 1590
Court / Jurisdiction: Lahore High Court (Honorable Mr. Justice Syed Ahsan Raza Kazmi)
This judicial decision was delivered by the Lahore High Court (Honorable Mr. Justice Syed Ahsan Raza Kazmi). The matter involves proceedings between Petitioner and Respondent, officially reported as 2026 LHC 1590. The court reviewed applicable Pakistani statutes, procedural requirements, and governing case-law authorities. The full text below contains the complete facts, arguments, and legal reasoning rendered by the honorable bench.
COURT: Lahore High Court (Honorable Mr. Justice Syed Ahsan Raza Kazmi) DECISION DATE: 04-03-2026 TAGLINE: Payment under Court-recorded compromise is distinguishable from pre-suit part-payment. Section 56 of the Negotiable Instruments Act, 1881, held inapplicable. CASE DETAILS: Civil Revision 13854/26 ============================================================ Form No:HCJD/C-121 ORDER SHEET IN THE LAHORE HIGH COURT, LAHORE JUDICIAL DEPARTMENT C.R. No.13854 of 2026 Muddassar Aleem Baber & another Vs. Rana Nisar Asim S.No. of order/ proceeding Date of order/ Proceeding. Order with signature of Judge, and that of parties or counsel, where necessary. 04.03.2026 Chaudhary Muhammad Zeeshan Ali, Advocate for the petitioners. Through the instant Civil Revision, the petitioners have assailed the vires of impugned order dated 10.02.2026 whereby the learned trial Court dismissed the application filed by petitioners under Order VII Rule 10 CPC, for return of plaint of summary suit under Order XXXVII Rule 1 & 2 CPC, to the civil court. 2. Brief facts necessary for disposal of the instant petition are that the respondent instituted a summary suit for recovery of Rs.1,33,00,000/- against the petitioners on the basis of nine cheques. Upon service of summons, the petitioners entered appearance and filed an application for leave to defend, which was allowed by the learned trial Court. During the pendency of proceedings, the parties entered into a compromise, reduced into writing in the form of Mark “A”, whereby the petitioners admitted their liability and undertook to pay the outstanding amount in nine installments. In view of the said compromise, the suit was conditionally consigned to the record room with the stipulation that in case of default, the respondent/plaintiff would be at liberty to seek restoration of the suit. Subsequently, the respondent moved an application for restoration of the suit on the ground that the petitioners had defaulted in making payment in accordance with the agreed schedule. The said application was contested by the petitioners but was 2 C.R. No.13854/2026
allowed by the learned trial Court vide order dated 23.09.2025. Thereafter, the petitioners filed an application under Order VII Rule 10, C.P.C. seeking return of the plaint on the premise that since partial payment had been received by the respondent, the summary suit under Order XXXVII, C.P.C. was no longer maintainable. The said application was contested by the respondent and ultimately dismissed through the impugned order, hence, the instant revision petition. 3. Learned counsel for the petitioners contends that after execution of compromise Mark “A” and consigning of the suit to the record room, the restoration application was not maintainable. It is further argued that the respondent having admittedly received partial payment from the petitioners could not proceed under Order XXXVII, C.P.C. in view of Section 56 of the Negotiable Instruments Act, 1881. Reliance has been placed upon the judgments reported as “KHALID MAHMOOD Vs. TANDLIANWALA SUGAR MILLS LTD. through Manager, Personnel and Administration Faisalabad” (PLD 2011 Lahore 52), “ SHAUKAT IQBAL Vs. MUHAMMAD SHUMAIL AKRAM” (2023 CLC 193) and “MUHAMMAD AFZAL Vs. BINYAMEEN SAJID” (2024 CLD 1124), wherein it has been held that where part payment of a cheque negotiable instrument amount is received without compliance of Section 56 of the Negotiable Instruments Act, the suit under summary jurisdiction is not maintainable and the matter falls within the jurisdiction of an ordinary civil court. 4. I have heard the learned counsel for the petitioners and have perused the record with his able assistance. 5. The pivotal question requiring determination is whether the partial payment made by the petitioners 3 C.R. No.13854/2026
during pendency of the proceedings pursuant to a compromise recorded before the Court renders the summary suit under Order XXXVII, C.P.C. incompetent and necessitates return of the plaint under Order VII Rule 10, C.P.C. 6. The case law relied upon by the petitioners has been carefully examined. In case-law titled as “KHALID MAHMOOD Vs. TANDLIANWALA SUGAR MILLS LTD. through Manager, Personnel and Administration Faisalabad” (PLD 2011 Lahore 52), it was held that where partial payment of a loan is made prior to the institution of the suit, the original negotiable instrument cannot be enforced for the reduced amount under summary jurisdiction unless a fresh instrument is issued for the lesser amount, and the claim must be pursued before the ordinary civil court. Likewise, in case-laws titled as “ SHAUKAT IQBAL Vs. MUHAMMAD SHUMAIL AKRAM” ( 2023 CLC 193 ) and “MUHAMMAD AFZAL Vs. BINYAMEEN SAJID” (2024 CLD 1124), it was held that once the payee receives part- payment of the cheque amount before filing of the suit, without following the procedure prescribed under Section 56 of the Negotiable Instruments Act, 1881, he cannot invoke the special summary jurisdiction under Order XXXVII, C.P.C. He has to file suit for recovery before ordinary civil court. 7. The factual matrix of the present case, however, is entirely distinguishable. Admittedly, the respondent instituted the summary suit on the basis of cheques and the petitioners entered appearance and contested the claim by filing an application for leave to defend. During the pendency of proceedings, the petitioners voluntarily admitted their liability of Rs.1,33,00,000/- and entered into a compromise whereby they undertook to discharge 4 C.R. No.13854/2026
the admitted amount in nine installments. In pursuance thereof, the first installment of Rs.14,77,777/- was paid on 31.03.2017, and the suit was conditionally consigned to the record room with the clear stipulation that in case of default the respondent would be entitled to seek restoration. 8. It is not disputed that the petitioners subsequently defaulted in making payment of the remaining installments, as a consequence whereof the suit was restored by the learned trial Court. The payment of the first installment thus formed part of a judicially recorded compromise during pendency of proceedings and was not a payment made prior to institution of the suit against the negotiable instrument in the ordinary course of business. 9. The distinction between part-payment made prior to institution of the suit and payment made pursuant to a compromise recorded before the Court during pendency of proceedings is significant. The former may attract the implications of Section 56 of the Negotiable Instruments Act, 1881, whereas the latter constitutes performance of a settlement acknowledging the original liability and does not alter the foundational basis of the suit. 10. In the present case, the petitioners not only admitted their liability before the learned trial Court but also secured the benefit of conditional consigning of the suit on the strength of their undertaking to liquidate the liability through installments. Having failed to honour their commitment, they cannot now be permitted to challenge the jurisdiction of the same Court by invoking technical objections. 11. It is by now well settled that a statement or undertaking given before a Court of law carries binding force and creates an estoppel against the maker thereof. 5 C.R. No.13854/2026
A litigant who voluntarily acknowledges liability before the Court and obtains a concession on that basis cannot subsequently be permitted to resile from the same in order to defeat the proceedings. Reference in this regard may be made to the settled principle that a party cannot approbate and reprobate simultaneously. 12. Furthermore, the scope of Order VII Rule 10, C.P.C. is confined to cases where the Court lacks inherent jurisdiction to entertain the plaint. The provision cannot be pressed into service where the Court otherwise possesses jurisdiction and the objection is raised merely to defeat the proceedings. In the present case, the suit was competently instituted under Order XXXVII, C.P.C. on the basis of cheques, which falls squarely within the definition of negotiable instruments. The subsequent compromise and partial payment made in pursuance thereof did not divest the learned trial Court of its jurisdiction. 13. The learned trial Court has, therefore, rightly concluded that the precedents relied upon by the petitioners are not applicable to the peculiar facts of the present case and that the payment made pursuant to compromise does not change the nature of the summary suit so as to require return of the plaint. 14. It is settled law that the revisional jurisdiction of this Court under Section 115, C.P.C. is limited in scope and is to be exercised only where the subordinate court has exercised jurisdiction not vested in it by law, has failed to exercise jurisdiction so vested, or has acted with material irregularity in the exercise of its jurisdiction. No such illegality or jurisdictional defect has been pointed out in the impugned order. 6 C.R. No.13854/2026
15. For the foregoing reasons, this Court finds no illegality, impropriety or jurisdictional defect in the impugned order dated 10.02.2026 passed by the learned trial Court. 16. Consequently, the instant Civil Revision petition is dismissed in limine.
(Syed Ahsan Raza Kazmi) Judge
APPROVED FOR REPORTING
Judge
Ejaz*