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Petitioner: Sahibzada ANWAR HAMID VS Respondent: Messrs TOPWORTH INVESTMENTS (MACAU) LTD. JUDGMENT
Court Name: Lahore High Court Judge(s): Syed Jamshed Ali Title:Sahibzada ANWAR HAMID vs Messrs TOPWORTH INVESTMENTS (MACAU) LTD.
JUDGMENT
Reported As: 2003 YLR 2843 Result: Revision dismissed Judgment JUDGMENT The order dated 23-5-1996 of the learned Additional District Judge, Lahore before whom a suit under Order XXXVII of the Code of Civil Procedure filed by the petitioner is pending has been assailed in this revision petition. The relevant facts may be noted hereunder. 2. On 30-7-1995, the petitioner filed a suit under Order XXXVII of the Code of Civil Procedure for the recovery of an amount of Rs.1,75,000 US Dollars with mark-up and costs against Messrs Topworth Investments (Macau) Ltd. (defendant No.1), Messrs Harvest International (Pvt.) Limited (defendant No.2), Mr. Yin Wai Ming William (defendant No.3), Mr. Lee Kim Wo (defendant No.4), Mr. Leving Hing Tak (defendant No.5) and Mr. Shahrukh Saeed (defendant No.6). 3. The case of the plaintiff-petitioner in the plaint was that defendant No.2 opened his business office at Lahore to transact the business of opening foreign currency accounts in collaboration understanding and arrangement with Topworth Hong Kong. The plaintiff opened foreign exchange Account No.8257. However, Messrs Topworth Investments Ltd. (Hong Kong) informed the plaintiff that for certain reasons the account will be held by Topworth Investments Ltd. (respondent No.1) and, therefore, plaintiff's account was taken over. It was averred that on 6-7-1995, the plaintiff had to his credit an amount of US Dollars 175,371.38. On the demand of the petitioner for settlement of his account, respondents Nos.3 to 6 expressed their inability to make the payment forthwith on which defendants Nos.3 to 5, acting as authorized agents of respondent No. 1, executed a promissory note on 7-7-1995 in the sum of US Dollar, 1,75,000. The said promissory note was duly presented on 10-7-1995 at the office of respondents Nos.1 and 2 but they refused to make the payment. The incident was reported to the Notary Public immediately who noted the fact of the
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pronote being dishonoured. On 30-7-1995 summons were issued to the defendants in the suit for 14-9-1995, meanwhile on 9-8-1995 an application for leave to appear and defend was filed through Mr. Ihsan-ul-Haq Bhalli, Advocate and Mr. Sana Ullah Khan Kakar, Advocate. It was not signed by any of the defendants in the suit. However, it was accompanied with the affidavit of Mr. Gulrez Mir. It may be noted here that defendant No.2 in the suit was sued through Gulrez Mir as its Chairman/Chief Executive and Director of the said Company. 4. On 14-9-1995 when the case came up for hearing before the learned trial Court, apart from Gulrez Mir, Shahrukh, defendant No.6 (wrongly described as defendant No.3 in the said order) were also present in person. The petitioner-plaintiff raised an objection that the Power of. Attorney submitted on behalf of respondent No. 1 was vague and incomplete. Accordingly, Gulrez Mir was directed to produce a proper Power of Attorney on behalf of respondent No. 1. It appears that respondents Nos.3, 4 and 5, who were shed in their individual capacity, had not been served. The telegrams addressed to them were also not served on them with report of the postal authorities that the addressees had left without leaving their addresses. In the order dated 14-9-1995 it was noted that defendants Nos.3 to 5 were not being represented properly. Respondents Nos.2 and 6, however, submitted that they will procure power of attorney on behalf of respondents Nos. 3 to 5. The case was adjourned for filing the powers of attorney to 20-9-1995. On 16-8-1995, defendants Nos.3 to 5 executed special powers of attorney in favour of Gulrez Mir, photocopies of which are on the record. In the order dated 7-5-1996, the learned trial Court noted that photocopies of powers of attorney and resolution were placed on record while the originals were returned. At this stage the learned counsel for the petitioner had objected that these documents should be impounded because these did not bear any stamp. Copy of the resolution dated 15-9-1995 of respondent No.1 appointing Mr. Gulrez Mir as its attorney and original special power of attorney dated 16-8-1995 by respondent No. 1 in favour of Mr. Gulrez Mir is also on the record. Copy of another resolution dated 12-4-1996 is also on the record of the trial Court whereby the Directors of respondent No.1 affirmed appointment of Mr. Gulrez Mir as attorney of respondent No. 1. 5. It may also be noted here that while the case was pending before Mr. Abdul Qadir Shad, learned Additional District Judge, the petitioner sought transfer of the case from his Court on which vide order dated 6-11-1991, the learned District Judge, Lahore transferred the case to the Court of Mr. Muhammad Aslam Zia, learned Additional District Judge. The petitioner, feeling still aggrieved, approached this Court in Civil Revision No.2270 of 1995 which was disposed of vide order dated 2- 4-1996 and the case was transferred to the Court of Mr. Shafqat Ahmed, learned Additional District Judge. While disposing of the said revision petition, this Court observed that the question whether the pleadings have been signed and verified by a duly authorized person as also the related question as to whether the learned counsel appearing on behalf of the respondents had lawful authority to file any pleadings as also to defend the suit will be considered at the trial. Meanwhile, on 5-10-1995 an application was moved by the petitioner before the trial Court under Order XXXVII, rule 2(2) read with section 151, C.P.C. Seeking a decree against the defendants on the ground that application for leave to appear was not filed by a duly authorized person. This application was, however, rejected vide order dated 23-5-1996 which has been impugned in the present petition. 6. The learned counsel for the petitioner has raised the following contentions:-- (1) The application for leave to appear and defend was not signed by any of the respondents nor verified. Thus the A provisions of rules 14 and 15 of Order VI of the Code of Civil Procedure were violated. (2) The affidavit of Mr. Gulrez Mir filed with the application for leave to appear and defend was also attacked with the contention that it did not disclose whether he was filing the application for leave to appear on his own behalf or on behalf of other defendants as well and that it was not claimed that the deponent was fully conversant with the facts of the case.
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(3) The verification of the affidavit was also challenged on the ground that it did not indicate the paragraphs which were true to the knowledge of the deponent and the contents of paragraphs which were true according to his information and thus the provisions of rule 15 of Order VI and rule 3 of Order XIX of the Code of Civil procedure were violated. (4) The Wakalatnamas dated 9-8-1995 in favour of Mr. Ihsan-ul-Haq Bhalli, Advocate and in favour of Mr. Sana Ullah Khan Kakar, Advocate dated 8-8-1995 were signed by a person who did not disclose his own capacity and the capacity in which he was competent to authorize the said Advocates to file application for leave to appear and defend on behalf of the respondents. (5) The person signing the power of attorney had no authority whatsoever for any of the respondents. Even-as far as respondent No.2 is concerned, his objection was that he was not authorized by a special resolution of the Company to move the application for leave to appear and defend on behalf of respondent No.2 even if the Memorandum and Articles of Association of respondent No.2 authorized him. Further these were not produced before the learned trial Court. Regulation No.49 of Table-A was also referred to. (6) Provisions of Order III, rule 4 of the Code of Civil Procedure and rule 4 of Chapter 1-C of Volume I and rules, 2, 4 and 5 of Chapter 6-B of Volume V of the High Court Rules and Orders were also pressed in support of the contention that the Wakalatnamas purporting to have been filed by respondent No.2 was in violation of the aforesaid provisions and the learned trial Court should have refused to recognize the lawyer. Thus, according to him no valid application for leave to appear and defend was filed on behalf of any of the respondents. (7) As far as defendant No.6 is concerned, no power of attorney was produced on his behalf alongwith the application for leave to appear and defend and only before this Court power of attorney executed by him in favour of Mr. Ihsan-ul-Haq Bhalli, Advocate for prosecuting the matter before the trial Court was placed on the record of this revision petition. (8) That the power of attorney filed in the case was objected to as noted in the order dated 14-9- 1995 and respondent No.2 was directed to produce the Power of Attorney on behalf of respondent No.1. According to him the trial Court did not recognize the authority of Gulrez Mir to represent respondent No.1. And, in any case on 14-9-1995 Gulrez Mir had no authority to represent respondents Nos.3 to 5. The aforesaid order dated 14-9-1995 not having been complied with, the application for leave to appear at least to the extent of respondents Nos.1, 3, 4 and 5 could not be considered. (9) The powers of attorney, on the record filed on behalf of respondents Nos. 1, 3, 4 and 5 are photocopies which were executed on 16-8-1995 and 15-9-1995 while application for leave to appear and defend was filed on 9-8-1995. The powers of attorney having been filed after expiry of the period prescribed by Article 159 of the Limitation Act, the application moved on 9-8-1995 could not be treated as having been filed on behalf of respondents Nos.1, 3,4 and 5. (10) That the learned trial Court erroneously applied the principle of ratification. According to him the powers of attorney did not specifically ratify the act of filing of application for leave to appear and defend by Gulrez Mir on behalf of respondents Nos. 1, 3, 4 and 5. Further, section 200 of the Contract Act was ignored by the learned trial Court according to which ratification could not affect the right or interest of the petitioner to claim a decree at least against respondents Nos. 1, 3, 4 and 5. According to him no retrospective ratification was possible. (11) Resolution dated 12-4-1996 by respondent No. 1 was also referred to which authorized Mr. Gulrez Mir to appoint legal practitioner in future and, therefore, on 9-8-1995, the date of application, Mr. Gulrez Mir had no authority to act on behalf of respondent No. 1. (12) The powers of attorney by respondents Nos. 1, 3, 4 and 5 in favour of Mr. Gulrez Mir were special powers of attorney which were required to be filed in original and, therefore, on the basis of the
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photocopies, Mr. Gulrez Mir had no. Authority to act for respondents Nos.1, 3, 4 and 5 even after the date of execution of the said Powers of Attorney. (13) Even if the original powers of attorney were produced (and returned by order of the Court), these could not be acted upon as these were not attested by two witnesses as required by Article 17 of the Qanun-e-Shahadat Order, 1984 and not attested in accordance with Article 95 of the said Order. (14) The powers of attorney were not attested by a Notary Public as required by the provisions of Notaries Ordinance No, 19 of 1961. According to him the Notaries of foreign countries were not included in Article 95 of Qanun-e-Shahadat Order, 1984. (15) He also submitted that the powers of attorney did not bear the court-fee stamp as required by Item No.48(g) of the Schedule of the Stamp Act and, therefore, were inadmissible by virtue of section 35 of the Stamp Act. (16) On 30-7-1995 summons were also sent through registered post, telegram, courier service and fax, therefore, the defendants in the suit shall be deemed to have been duly served and during the time contemplated by Article 159, no application for leave to appear having been filed, the suit of the petitioner ought to have been decreed. (17) Under sections 451, 452 of the Companies Ordinance, 1984 a foreign company was required to submit certain documents and returns to the Registrar of the Companies and the consequence of non-compliance of the said provisions as provided by section 456 of the said Ordinance, was that respondent No. 1 was under a total disability to institute any legal proceedings and, therefore, even with the authority later given to Mr. Gulrez Mir, no application for leave to appear and defend could be filed on behalf of respondent No. 1. According to him provisions of section 456 were mandatory. (18) Sections 455 and 48 of the Companies Ordinance were also relied upon to contend that process issued for the service of respondents Nos. 1, 3, 4, 5 and 6 was due service and the failure of the said, respondents to apply for leave to appear and defend within the time prescribed by law was fatal. (19) Mr. Gulrez Mir, on the date of application, was neither the duly constituted attorney nor even a recognized agent of respondent No. 1. (20) Respondent No.2 being a limited Company oral authorization or ratification was not sufficient to authorize Mr. Gulrez Mir to act on behalf of respondent No.2. Mr. Gulrez Mir claimed to be holder of a Power of Attorney on behalf of respondent No.1 and, therefore, he could not claim to be its recognized agent. (21) Agreement of agency produced before this Court was challenged on the ground that it was not produced before the trial Court and, therefore, could not be filed before this Court. He submitted that, at some stage arguments in the revision petition were concluded and thereafter this agreement of agency was filed before this Court. It was for a period of two years commencing 10-9-1993 and expired on 9-9-1995. (22) The transaction was entered into with Topworth Hong Kong while the special power of attorney was executed by Topworth Macau in favour of Mr. Gulrez Mir. (23) A lis is to be decided in accordance with law and when a legal provision was explicit and clear, principles of equity or substantial justice cannot be imported, when a mandatory provisions of law is violated. 7. The learned counsel for the petitioner placed reliance on the following judgments:-- (1) Ghulam Ali and 2 others v. Mst. Ghulam Sarwar Naqvi PLD 1990 SC 1. (2) Aziz Khan Commander (E) v. The Government of Pakistan and others 1991 CLC 334. (3) Punjab Livestock Dairy and Poultry Development Board v. Sh. Muhammad Younus 1980 CLC 1932. (4) Muhammad Hussain v. Bashir Ahmed and others PLD 1987 Lahore 392. (5) Muhammad Mehrban v. Sadr-ud-Din and another 1995 CLC 1541.
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(6) Muhammad Imran Barni v. Federation of Pakistan through Ministry of Communication and Information, Islamabad and 4 others 2001 YLR 2666. (7) Qurban Hussain and 2 others v. Hukam Dad PLD 1984 SC (AJ&K) 157. (8) Government of Pakistan v. Premier Sugar Milla and others PLD 1991 Lahore 381. (9) Sheikh Muhammad Shafique v. Humayun Kabir and 3 others 1981 CLC 1248. (10) Abubakar Saley Mayer v. Abbot Laboratories and another 1987 CLC 367. (11) Bankers Equity Ltd. Through Attorney and 5 others v. Sunflow CIT-Russ Ltd. (formerly known as Sunflow Juices Ltd.) through Managing Director PLD 1999 Lahore 450. (12) Azad Jammu and Kashmir Government through its Chief Secretary at Muzaffarabad and 4 others v. Sardar' Muhammad Azad Khan 2000 YLR 2662. (13) Notified Area Committee, Okara v. Kidar Nath and others AIR 1935 Lahore 345. (14) Messrs Standard Hotels (Private) Ltd. v. Messrs Rio Centre and others 1994CLC 2413. (15) Khan Iftikhar Hussain Khan of Mamdot (represented by 6 Heirs) v. Messrs Ghulam Nabi Corporation Ltd., Lahore PLD 1971 SC 550. (16) Messrs Ideal Life Insurance Co. Ltd. And another v. Mst. Khairunnisa A.G. Mirza. 1980 CLC 1375. (17) Devk Sports Ltd. v. Silver Stars Ltd. And others 1989 MLD 3493. (18) F. Kanematsu & Co. Ltd. v. S. Nazir Hussain Puri PLD 1957 (W.P.) Karachi 832. (19) Bank of Baroda v. Messrs Surendra Udvog (1989) 2 CCC 132 (this book is not available). (20) Muhammad Umar Mirza v. Waris Iqbal and others 1990 SCMR 964. (21) O.A.P.R.M.A.R. Adaikappa Chattiar v. Thomas Cook & Son (Bankers) Ltd. AIR 1933 Privy Council 78. (22) National Bank of Pakistan and others v. Karachi Development Authority and others PLD 1999 Karachi 260. (23) Murid Hussain and others v. Muhammad Sharif through his Legal Heirs 1996 CLC 161. (24) Pakistan Cement Industries Ltd., Rawalpindi v. Teekayee Trading Co. PLD 1971 Lahore 522. (25) Mst. Karim Bibi and others v. Hussain Bakhsh and another PLD 1984 SC 344. (26) Lahore Improvement Trust, Lahore through its Chairman v. The Custodian, Evacuee Property, West Pakistan, Lahore and 4 others PLD 1971 SC 811. (27) Pakistan Tanneries Ltd. v. Sardar Hidayat Ullah Mokal and 5 others PLD 1972 Lahore 880. (28) Mst. Musarrat Bibi and 2 others v. Tariq Mahmood Tariq 1999 SCMR 799. (29) Punjab Zamindars Bank Ltd. v. Madan Mohan Singh and others AIR 1936 Lahore 321. (30) Babu Muhammad Aslam v. Mst. Rehana Parveen PLD 1989 Peshawar 185. (31) Zia-ud-Din Siddiqui v. Mrs. Rana Sultana and another 1990 CLC 645. (32) D. Sardar Singh v. Seth Pissumal Harbhagwandas Bankers AIR 1958 Andhra Pradesh 107. (33) S.M. Khalil v. Biswa nth Basak 1971 DLC (Rev.) 62. (34) Haji Yousuf v. Jalal-ud-Din and another 1986 CLC 363. (35) Munir Hussain v. Mst. Mehrun Nisa (through her Legal Heirs) PLD 1982 Karachi 71. (36) Manager, Jammu and Kashmir, State Property in Pakistan v. Khuda Yar and another PLD 1975 SC 678. (37) Board of Control for Cricket in Pakistan v. Karachi Development Authority through Director- General and 51 others 1997 CLC 795. (38) Walton Tobacco Company (Pvt.) Ltd. And others v. Azad Government of the State of Jammu and Kashmir and others 1993 CLC 66. (39) Shahab-ud-Din and others v. Mst. Mariam Bibi and others 1995 MLD ' 45. 8. On the other hand, Mr. Ihsan-ul-Haq Bhalli, Advocate defended the impugned order. According to him respondent No. 1 was a foreign company while respondent No.2 was registered in Pakistan. Respondent No.2 was the agent of respondent No. 1. Mr. Bhalli made submissions on the merits of the case by attacking the pronote and authority of respondents Nos.3, 4 and 5 to execute the 'pronote on behalf of respondent No.1 but these facts not being relevant to the controversy being
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raised in this petition, it is not considered necessary to note them. As far as respondent No.2 is concerned, he invited my attention to the plaint in which the said respondent has been sued through Mr. Gulrez Mir its Chairman/Chief Executive and Director. He also referred to paragraphs 1 to 4 of the plaint to contend that in fact it was conceded that respondent No.2 was the agent of respondent No.1. Apart from the special power of attorney executed by respondent No.1 in favour of Gulrez Mir, he pressed provisions of clause (b) of rule 2 of Order III of the C.P.C. To contend that respondent No.2, acting through its Director/Chief Executive, qualified as a recognized agent of respondent No. 1. About respondents Nos. 3, 4 and 5 he submits that even according to the case set up in the plaint, they acted for and on behalf of respondent No. 1 as authorized agents of respondent No. 1 and had appointed Gulrez Mir as their special attorney. As far as defendant No.6 is concerned it was contended that lie was a Director of respondent No.2 and had executed a power of attorney in his favour which could not be inadvertently filed before the learned trial Court which was, however, filed before this Court with an application. He also referred to Article 71 of the Articles of Association of respondent No.2, which specifically empowers the Chief Executive to institute, prosecute, defend etc. Any legal proceedings by or against the Company or its officers or otherwise concerning the affairs of the Company. On the basis of the said Article he submits that Gulrez Mir, could defend the suit against respondent No.6 on the basis of the aforesaid power. The returns filed by respondent No.2 before the Registrar of Companies were also referred to. He submits that as noted in the order dated 14-9-1995 service of respondents Nos.3 to 5 was dispensed with by the Court with the direction that powers of attorney on their behalf should be filed. According to him defendants Nos. 1, 3 to 5 were not served and if authority of Mr. Gulrez Mir to represent respondents Nos. 1, 3 to 5 was being questioned, proper service of respondents Nos. 1, 3 to 5 should have been procured. Affidavit of Shahrukh Saeed, respondent No.6, filed before this Court, was also relied upon in which he affirmed having appointed Mr. Ihsan-ul-Haq Bhalli, Advocate as his counsel. He next contended that any defect in the Wakalatnama or even non-filing of Wakalatnama with the application was only a curable defect. According to him the authority of the agent could be disputed only by, the principal. He further contended that the objections as to the validity of the Power of Attorney raised by the learned counsel are only hyper-technical, Not only his authority to represent them has been affirmed by all the respondents, no prejudice is otherwise caused to the petitioner because 1,75,000 US Dollars already stand attached. He submits that the technicalities, unless offer insurmountable hurdles, cannot be allowed to defeat the ends of justice. He also relied upon the agreement of agency to contend that respondent No.2 was a duly constituted agent of respondent No.1 and Mr. Gulrez Mir validly acted not only on behalf of respondent No.2 but also on behalf of respondents Nos. 1 and 6. He further submits that there is no express form for ratification. It could be expressed or implied and the execution of special powers of attorney by respondents Nos.3 to 5 in favour of Gulrez Mir had the effect of ratifying the appointment of Mr. Bhalli as their counsel. According to him mere non-disclosure of the capacity in which Gulrez Mir signed the affidavit was of no consequence. He also contended that the original powers of attorney and the resolution dated 12-4-1996 were duly produced in original before the trial Court. These were inspected by the Court, the originals returned and the photocopies thereof retained on the record. As far as respondent No.1 is concerned the original power of attorney was on the record of the learned trial Court. He next contended that if the trial Court was not satisfied that the application for leave to appear and defend was not filed through an authorized person, the issue could only be resolved by providing opportunity to the respondents to produce evidence to show that application for leave to appear and defend was competently filed by a duly authorized person. He also controverted the contentions of the learned counsel for petitioner based on the provisions of the Companies Ordinance or the Qanun-e--Shahadat Order and rules 14 and 15 Order VI of the Code of Civil Procedure.
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9. In support of his submissions he placed reliance on the following judgments:-- (i) Muhammad Fayyaz and another v. Director, Procurement Army others 1997 CLC 88. (ii) Muhammad Munshi and another Mst. Rakiya Bi 1990 CLC 301. (i.e) Ghulam Qadir and another v. Abdul Sattar and another PLD 1984 SC 12. (iv) Ismail and another v. Mst. Razia Begum and 3 others 1981 SCMR 687. (v) Mst. Azra Begum v. Piran Ditta PLD 1967 Lahore 807. (vi) Mst. Karam Nishan v. Mehrban Ali Shah PLD 1959 (W.P.) Lahore 946. (vii) Abdul Wadud v. The State PLD 1964 Dacca 543. (viii) Ibrahim Ismail v. Brig. (Retd.) S.H.A. Gardezi PLD 1983 Karachi 154. (ix) Abdul Ghaffar v. Jamaluddin 1986; CLC 747. (x) Khyam Films and another v. Bank of Bahawalpur Ltd. 1982 CLC 1275. (xi) State Life Insurance Corporation of Pakistan v. Mst. Maroof Jan and others PLD 1986 Peshawar 121. (xii) Australasia Bank Ltd. v. Abdul Aziz Jan and others PLD 1983 Peshawar 64. (xiii) Imtiaz Ahmed v. Ghulam Ali and 2 others PLD 1963 SC 382. (xiv) Lt.-Col. (Retd.) P. G. Braganza v. The Border Area Allotment Committee and another 1984 CLC 1479. (xv) Messrs Government Employees Cooperative Housing Society Ltd. And another v. Province of Punjab and others 1995 CLC 765. (xvi) Mst. Aziza Begum and 5 others v. Muhammad Hussain Khan and 4 others 1995 CLC 1578. (xvii) Toor Gul v. Mst. Mumtaz Begum PLD 1972 SC 9. (xviii) Mst. Shanaz Begum and 4 others v. Ashiq Hussain Bhatti and 2 others 1995 CLC 327. (xix) Sirbaland v. Allah Loke and others 1996 SCMR 575. (xx) Muhammad Khaliq v. Abdullah Khan and 4 others 1997 CLC 1366. 10. I have considered the submissions made by the learned counsel for the parties and had the benefit of going through a large number of precedent cases cited at the bar by the learned counsel. Before respective contentions of the learned counsel for the parties are examined, I will like to refer to the following observations of the Honourable 'Supreme Court made in the case of Trustees…
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