-Suit for recovery--Dismissed--Agreement to sell--Issuance of cheques for sale consideration--Dishonouring of cheques--Appellant was not owner of property--Suit property was not transferred in favour of respondent--

 PLJ 2023 Peshawar 55
[D.I. Khan Bench]
Present: Muhammad Faheem Wali, J.
SHAMSHAD ALAM--Appellant
versus
GHAZANFARULLAH KHAN--Respondent
R.F.A. No. 24-D of 2017, decided on 8.9.2022.

Civil Procedure Code, 1908 (V of 1908)--

----O.XXXVII--Negotiable Instruments Act, (XXVI of 1881), S. 118--Suit for recovery--Dismissed--Agreement to sell--Issuance of cheques for sale consideration--Dishonouring of cheques--Appellant was not owner of property--Suit property was not transferred in favour of respondent--Cheques were accepted as advance--Burden to prove--Status of negotiable instruments--Challenge to--Neither appellant was owner of said landed property nor has he transferred same in favour of respondent--Property which was in-fact consideration of cheques in question, has not been delivered to defendant; therefore, same does not confer right upon plaintiff to seek recovery from defendant through summary suit--If agreement to sell in this case between parties has not yet been accomplished, cheques which were accepted by plaintiff in advance for payment of property would become instruments without consideration--Both cheques in question do not qualify status of negotiable instruments and therefore, there is no misreading, non-reading of evidence & record, or jurisdictional defect in impugned Judgment of Court below--Appeal dismissed.        [Pp. 57 & 58] A, B, D & F

Negotiable Instruments Act, 1881 (XXVI of 1881)--

----S. 118--Negotiable instrument--Obligation of payment--If a negotiable instrument is made or drawn without consideration, it creates no obligation of payment between parties to transaction--Issuance of a cheque is not a conclusive presumption of drawing consideration of negotiable instrument, rather it can be rebutted and initial burden of proving case i.e. Negotiable Instrument/ cheque has been executed against consideration, lies on plaintiff.                                                                                                      

                                                                              [Pp. 57 & 58] C & E

1973 SCMR 332.

Mr. Zain-ul-Abideen Afridi Advocate for Appellant.

M/s. Rizwanullah Arain and Inamullah Kundi Advocate for Respondent.

Date of hearing: 8.9.2022.

Judgment

Appellant through this Regular First Appeal, filed under Section 96 of the Code of Civil Procedure (Act-V) 1908, has called in question the vires of Judgment & Decree dated 18.05.2017 passed by the learned Additional District Judge-II, D.I.Khan, whereby the learned trial Court, dismissed his suit for recovery of Rs.42,00,000/- filed under Order XXXVII CPC.

2. Facts forming factual canvas of this appeal are that the appellant/plaintiff instituted a summary suit under Order XXXVII CPC against defendant for recovery of Rs.42,00,000/- on the basis of cheques bearing No. 7096805 dated 15.10.2014 and No. 1811923 dated 10.09.2014 alleging that he had struck a bargain of his landed property with the defendant through an agreement dated 17.06.2014, and for consideration thereof, defendant handed over him aforesaid cheques which on presentation before concerned bank on the relevant date were dishonoured. Respondent with the leave of the Court to defend the suit, filed his written statement, and thereafter, the learned trial Court framed issues and recorded evidence of parties. Finally, learned trial Court vide Judgment & Decree dated 18.05.2017 dismissed the suit, hence, the appellant preferred the instant appeal.

3. Arguments of the learned counsel for parties heard and record gone through with their valuable assistance but for the sake of brevity, without reproducing the arguments of the counsels, same will be adequately dealt with at appropriate stages in this judgment.

4. A meticulous sifting of the record transpires that both the cheques in question were handed over to appellant by the defendant in lieu of consideration of landed property, vide agreement to sell dated 17.06.2014. However, it is an admitted fact on the face of record that neither the appellant/plaintiff was owner of the said landed property nor has he transferred the same in favour of the respondent/defendant. PW-4/plaintiff in his cross examination made certain crucial admissions, which are reproduced hereunder:

"یہ درست ہے کہ اراضی مذکورہ سودا سے پہلے نہ تو میرے نام پر رجسٹری تھی اور نہ ہی انتقال تھی ۔۔۔۔۔۔۔۔۔۔۔۔ یہ درست ہے کہ اراضی مذکورہ کا میں نے مدعا علیہ کہ نہ تو رجسٹری دی ہے اور نہ ہی انتقال دیا۔"

5. Also, there is no iota of evidence which could prove that the appellant/plaintiff transferred the property in question in favour of respondent/defendant through any other means; thus, the property which was in-fact the consideration of cheques in question, has not been delivered to the defendant; therefore, the same does not confer right upon plaintiff to seek recovery from defendant through the summary suit. If a negotiable instrument is made or drawn without consideration, it creates no obligation of payment between the parties to the transaction. Similarly, if the consideration for which the instrument was made or drawn has failed subsequently, then also, the instrument creates no obligation at all. Therefore, if the agreement to sell in this case between the parties has not yet been accomplished, the cheques which were accepted by the plaintiff in advance for payment of the property would become instruments without consideration; or in other words, they will be instruments for which consideration had failed. In this regard provisions of Section 43 of the negotiable Instruments Act, 1881, are very much clear which read as under:

43. Negotiable instrument made etc. without consideration. A negotiable instrument made, drawn accepted, indorsed or transferred without consideration, or for a consideration which fails, creates no obligation of payment between the parties to the transaction. But if any such party has transferred the instrument with or without indorsement to a holder for consideration, such holder, and every subsequent holder deriving title from time, may recover the amount due on such instrument from the transferor for consideration or any prior party thereto.

Exception I. No party for whose accommodation a negotiable instrument has been made, drawn, accepted or endorsed can, if he has paid the amount thereof, recover thereon such amount from any person who became a party to such instrument for his accommodation.

Exception II. No party to the instrument who has induced any other party to make, draw, accept, indorse or transfer the same to him for a consideration which he has failed to pay or perform in full shall recover thereon an amount exceeding the value of the consideration (if any) which he has actually paid or performed.

6. The contention of learned counsel for the appellant is that issuance of cheques is not denied by respondent, as such, cheque is negotiable instrument and presumption of its consideration is also attached with it as provided under Section 118 of the Negotiable Instruments Act, but this Court is not in agreement with the said contention of learned counsel for appellant, for the reason, that under Section 118 of Act ibid, issuance of a cheque is not a conclusive presumption of drawing consideration of negotiable instrument, rather it can be rebutted and initial burden of proving the case i.e. Negotiable Instrument/cheque has been executed against consideration, lies on the plaintiff. Reliance is placed on the principle handed down in the case of “Salar Abdur Rauf vs. Mst. Barkat Bibi” (1973 SCMR 332).

7. In view of the above discussion, both the cheques in question do not qualify the status of negotiable instruments and therefore, there is no misreading, non-reading of evidence & record, or jurisdictional defect in the impugned Judgment of the learned Court below. The instant appeal is bereft of merits, and dismissed as such with no order as to cost.

(Y.A.)  Appeal dismissed