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Issues Involved:
1. Terms of the cash credit account. 2. Quantity and value of the pledged goods. 3. Possession of the pledged goods by the Deputy Custodian of Evacuee Property, Multan. 4. Joint possession of the goods. 5. Bank's liability to account for the pledged goods. 6. Bank's negligence. 7. Suit maintainability. 8. Bank's set-off claim. 9. Set-off claim without court fees. 10. Timeliness of the set-off claim. 11. Unauthorized written statement. 12. Improperly verified written statement. 13. Entitlement to special costs. 14. Relief. Detailed Analysis: Issue No. 1: Terms of the Cash Credit Account The court examined the cash credit agreement (Ex. D1/7) dated October 23, 1946, which outlined the terms of the agreement between the plaintiff and the bank. The agreement provided for the pledge of goods as security, the margin to be maintained, and the insurance requirements. The court concluded that Ex. D1/7 accurately represented the terms and conditions agreed upon by the parties, and no evidence was presented to contradict or vary these terms. Issue No. 2: Quantity and Value of the Pledged Goods The plaintiff claimed that the value of the pledged goods at the end of August 1947 was Rs. 2,58,000/-. The court accepted the oral and documentary evidence presented by the plaintiff, including the testimony of the bank's godown-keeper and the stock report dated August 21, 1947. The court concluded that the value of the pledged goods was indeed Rs. 2,58,000/- as claimed by the plaintiff. Issue No. 3: Possession by the Deputy Custodian of Evacuee Property, Multan The bank claimed that the pledged goods were taken over by the Deputy Custodian of Evacuee Property, Multan. The court found that while part of the goods might have been taken over, there was no evidence to prove that the entire stock was taken over by the authorities. Additionally, the bank failed to provide evidence of any law in Pakistan that would exonerate it from liability. Therefore, the court held that the partial take-over had no effect on the bank's liability to the plaintiff. Issue No. 4: Joint Possession of the Goods The court rejected the bank's claim that the goods were in joint possession of the bank and the plaintiff. It was determined that the goods, though stored in the plaintiff's godowns, were under the exclusive possession and control of the bank through its godown-keeper. The court concluded that the goods were in the exclusive possession of the bank. Issues Nos. 5 & 6: Bank's Liability and Negligence The court examined whether the bank took reasonable care of the pledged goods as required by law. Given the extraordinary circumstances following the partition of India, the court concluded that the bank could not have taken any additional steps to protect the property. The bank was found to have discharged its obligations as a bailee and was not guilty of negligence. Therefore, the bank was not liable to account for the pledged goods or to pay their price to the plaintiff. Issue No. 7: Suit Maintainability The court held that the suit was maintainable and that the Delhi Court had jurisdiction to entertain it, as the bank had its head office in Delhi. Issues Nos. 8, 9 & 10: Bank's Set-Off Claim The bank's claim for set-off was rejected on multiple grounds. The bank did not pay the requisite court fees, and the claim was barred by time as it related to a period prior to 1947. Additionally, the claim was barred by Section 17 of the Displaced Persons (Debts Adjustment) Act, 1951, as the pledged property was no longer in the bank's possession. Issues Nos. 11, 12 & 13: Unauthorized Written Statement, Improper Verification, and Special Costs These issues were not seriously pressed by either party. The court found no grounds to award special costs to the bank. Issue No. 14: Relief The court dismissed the suit, leaving the parties to bear their respective costs. Conclusion: The suit was dismissed, and the court found that the bank had discharged its obligations as a bailee and was not liable for the loss of the pledged goods. The bank's claim for set-off was also rejected.
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