KALA RAM Vs. PUNJAB NATIONAL BANK, LTD

JUDGEMENT

(1.) These are consolidated appeals against the judgments and decrees; dated 22nd October 1932, of the Judicial Commissioners of the North-West Frontier Province, reversing the judgments and decrees, dated 2 December, 1931, of the Court of the Senior Subordinate Judge of Peshawar. In the first case, the Punjab National Bank, hereinafter termed "the plaintiff," filed a suit for Rs.10,242-11-2 on 11 March 1929, against four brothers, Relumal, Dharam Chand, Gurmukh Dass and Kala Ram, who were said by the plaintiff to have been customers of the Bank and to have incurred to it a debt of that amount. The debt was alleged to have been incurred after July 1928. In the second case, which was directed solely against the appellant, the plaintiff "sued for the balance of a loan account-viz., Rs. 6,887-the claim being based on a promissory note dated 8 June 1928. The main defence propounded by the appellant was that, on 5 October 1919, he ceased to be a partner in the firm of the four brothers, that notice of his retirement from the firm duly reached the plaintiff, that subsequent transactions were not with him, and that accordingly he was free from liability for the sums sued for. It may be added that the fact of the dissolution of the partnership in 1919 was not in dispute. The issue relates to whether or no the plaintiff had notice of that dissolution. The circumstances under which the claims by the plaintiff were made sufficiently appear from the judgments in the Courts below, and their Lordships deem themselves absolved from again rehearsing them in detail. S. 264, Contract Act, 1872 (Act 9 of 1872) provides: "Persons dealing with the firm will not be affected by a dissolution of which no public notice has been given, unless they themselves had notice of such dissolution."

(2.) Admittedly, in this case, no public notice of the retirement of the appellant in 1919 from the firm of the four brothers was given; but it was strenuously maintained on his behalf that the plaintiff was apprised of that retirement before the debts sued for were contracted. If that was so, the problem submitted to the Board for decision is solved. The question whether the plaintiff had notice of the dissolution of the firm of four brothers by the retirement of the appellant from it is one of fact, and the onus of proving that fact is plainly, and indeed admittedly, on the appellant. Has he then discharged that onus? Or must the verdict be one of "not proven?" The question is not free from difficulty, and the difficulty is increased by the course of the proceedings in the Courts below. The Senior Subordinate Judge does not allude to the question of notice in his judgment, while the Judicial Commissioners dismiss it in a few lines. The latter say, in the course of their judgment, that"admittedly the bank did not know of the dissolution until after the transaction on which the present suit is based."

(3.) Their Lordships cannot help thinking that this statement is based upon a misapprehension. It is true that no registered notice was given, and it may be that the Judicial Commissioners in the passage from their judgment now under survey were referring to that fact. However that may be, the Judicial Commissioners then proceed, in effect, to hold that no such notice was given. Their Lordships find themselves unable to agree with the conclusion of the Judicial Commissioners on this matter. The evidence to the effect that notice was given, in their Lordships' opinion, suffices to discharge the onus of proof. In the first place, the evidence adduced by the appellant affirms a general practice of giving notice under the circumstances which existed in this case, and raises a presumption that it was given. A new loan account was opened by the firm in 1920, and it is clear from the evidence that the practice of the plaintiff was to make due enquiries regarding any applicants for a new loan. Moreover, there is substantive and convincing evidence to the effect that notice was given by the appellant to the plaintiff. The witness Gurmukh, who was adduced by the appellant, states that, in the application to the plaintiff for a loan, the names of the three brothers, omitting that of the appellant, were given. There is really no cross examination upon this testimony, and certainly no contradiction of it, by production of the application form or otherwise. Further, there is the definite evidence of the witness Shival, who was also adduced by the appellant as a witness, who was manager for the plaintiff at the relevant period, and who was the appropriate person to make enquiry, to the effect that he was informed by one Amir Chand, the Treasurer of the Bank, that the appellant had separated himself from the firm by a deed of release. Amir Chand, who was also called by the appellant, in terms confirms this evidence. Now Shival held a responsible position in the Bank, and no suggestion has been, or indeed could be made, against his probity or truthfulness. The evidence of these witnesses constitutes a formidable body of testimony.