1999 PLP 1671 (CLC)

3. Perusal of the impugned judgment dated 14‑2‑1989, the preliminary decree, dated 19‑2‑1990 and final decree, dated 29‑4‑1993 after consideration of the report of the Commissioner, tends to show although the petitioner appeared before the trial Court on 7‑5‑1988 no written statement was filed and the petitioner remained absent throughout with the natural consequence that the suit was disposed of under Order VITT, Rule

10. C.P.C..

4. This petition was admitted to consider the question whether the respondent could have filed the suit before the Civil Court whose jurisdiction was barred under section 6(4) of the Banking Companies (Recovery of Loans) Ordinance, 1979 (hereinafter referred as the Ordinance, 1979) as well as under the Land Revenue Act; 1967. With the admission of the petition in January, 1994 proceedings in Execution Application No.15 of 1993 pending before the Executing Court were staved.

5. Learned counsel for the petitioner vehemently contended that the relationship between a borrower and the petitioner bank was regulated by the provisions of section 6(4) of the Ordinance, 1979 which jurisdiction being exclusive the decree passed by the Civil Court was void ab initio and nullity in law which is liable to be quashed and declared as such. For the sake of advantage and appreciation of the controversy aforesaid provision of law may be reproduced hereunder:‑‑ "

6. Powers of Special Court.‑‑‑ (1) A Special Court shall (a) in the exercise of its civil jurisdiction

(4) No Court other than a Special Court shall have or exercise any jurisdiction with respect to any matter to which the jurisdiction of a Special Court extends under this Ordinance, including a decision as to the existence or otherwise of a loan and the execution of a decree passed by a Special Court; and all proceedings, including proceedings following the filing of an arbitration award and proceedings for the execution of a decree within the jurisdiction of a Special Court, by whatever Court passed, which may be pending in any Court immediately before the commencing day shall stand transferred to the Special Court: (Provided that nothing in this subsection shall be deemed to affect‑‑ (a)

(b)

6. In order to reinforce the above submission learned counsel relied upon the judgments reported as (i) Muzaffaruddin v. Commerce Bank Ltd. 1981 CLC 665, (ii) In re: District Judge, Karachi 1985 CLC 718, (iii) Nabiullah v. Habib Bank Ltd. PLD 1990 Pesh. 17, (iv) Muhammad Nazeer Afandi v. I.D.B.P. PLD 1992 Pesh. 87 and (v) A.D.B.P. v. Ch. Harvesting Company PLD 1993 Lah 328.

7. In view of the clear mandate of law in all the reported cases from Sindh, Lahore and Peshawar jurisdiction it was firmly laid down that no Court other than a Special Court constituted under Ordinance, 1979 has jurisdiction to decide as to existence or otherwise of a loan. It was further laid down that in the pending suits of loans of more than Rs.1,00,000 if the question is one of determination of the existence of loan the case shall stand transferred to the Special Court. Suits for the recovery of loan less than Rs.1,00,000 were held to be not hit by the Ordinance whether pending or otherwise. In respect of the matters pending before the High Court and Supreme Court the same were to be dealt with under section 13 of the Ordinance.

8. On the other hand Mr. Mirza learned counsel for the respondent referred to section 1(3) of the Ordinance, 1979 postulating that it applies to all Banking Companies except the Agricultural Development Bank of Pakistan to which only such of the provisions of this Ordinance shall apply, and from such date as the ‑Federal Government may by‑ notification in the official gazette specify. It is not disputed that the suit before the Civil Court was instituted on 2‑5‑1988 and decreed ex parte in terms of Order VIII, Rule, 10, C.P.C. on 14‑2‑1989. Obviously preliminary decree was passed on 19‑2‑1990 whereas final decree was drawn on' 19‑4‑1993.

9. At the hearing a confusion was created by the observations in the Lahore case reported as PLD 19931 Lah. 328 in which the suit had, been filed in the Civil Court on 15‑4‑1992 and stay order had been granted on 19‑9‑1992 whereas it was observed that Ordinance, 1979 had been made applicable to the A.D.B.P. with effect from 4‑10‑1979. For this reason learned Single Judge of the Lahore High Court took the view that suit in question as also application for grant of stay order were, thus, not triable by Civil Court and the stay order granted by the Court below had to be vacated. In the body of the judgment however‑ a reference was made to Notification No.Fl(2)Bkg‑IV/88‑2198, dated 1‑10‑1992 whereby provisions of the Ordinance, 1979 were made applicable to the A.D.B.P. In the face of this discrepancy as to the crucial date on which the provisions of the Ordinance, 1979 were made applicable to the petitioner bank we reserved the judgment and directed the petitioner's counsel to submit a copy of the notification to order to resolve the ambiguity.‑

10. With the assistance of the learned counsel we have been able to lay hands on the notification, dated 1st October, 1992 issued by the Government of Pakistan Finance Division notifying that in exercise of the powers conferred by subsection (3) of section 1 of the Banking Companies (Recovery of Loans) Ordinance, 1.979, the Federal Government was pleased to specify that sections 1 to 4. 6 to 12 and 14 to 15 shall apply to the A.D.B.P. from immediate effect. In this view of the matter it is evident and crystal clear that on the date of institution of the suit as also the date of judgment and preliminary decree, Civil Court had the requisite jurisdiction to hear and adjudicate upon the dispute between the parties. Civil Court being a Court of plenary and ultimate jurisdiction in terms of section 9, C.P.C. shall have jurisdiction to try all suits of a civil nature excepting suits of which their cognizance is either expressly or impliedly barred. Quite certainly since the provisions of Ordinance, 1979 creating Special Courts for trial of suits between borrower and a banking Company were expressly excluded in relation to the petitioner bank we are of the view that initially jurisdiction of the Civil Court was not barred as contemplated under section 6(4) of the Ordinance.

11. Adverting to the effect of extension of the provisions of section 6 of the Ordinance to the petitioner bank w.e.f. 1‑10‑1992 the question that remains for consideration is whether the Civil Courts jurisdiction remained intact in relation to a cause in which a preliminary decree had been passed whereas final decree had not been drawn. Short answer to the question posed in this petition, therefore, is as to the effect and validity of the final decree passed after the extention of the provisions of Ordinance, 1979 to the petitioner bank. The notification, dated 1‑10‑1992 furnishes a direct answer to the question involved. We are of the view that till the passing of the preliminary decree learned Civil Court was duy authorised and fully competent to proceed with the suit instituted before it but since the preliminary decree had not attained finality no: was it executed before the crucial date, jurisdiction to proceed further with the proceedings was expressly ousted. Needless to point out the provisions of section 6(4) of the Ordinance reproduced in paragraph 5 of this judgment expressly lay down that no Court other than a Special Court shall have jurisdiction with respect to any matter to which its jurisdiction extends under the Ordinance including a decision as to the existence or otherwise of a loan and the execution of a decree passed by a Special Court. It further postulates that all proceedings including proceedings for execution of a decree within its jurisdiction by whatever Court passed (underlined for emphasis sake) that may be pending in any Court immediately before the commencing date (underlining is ours) shall stand transferred to the Special Court. It would, thus, appear that after the passing of the preliminary decree jurisdiction assumed by the Civil Court was barred by law as no Court other than the Special Court could proceed and continue with a suit of the instant nature. In our view even if final decree had been drawn before the crucial date execution proceedings would be before the Special Court and not before any Court which passed the decree. It may be pertinent to observe that with regard to the petitioner bank the date of commencement of the Ordinance, 1979 would be 1‑10‑1992 and with effect from this date Civil Court or for that matter any other Court shall cease to have jurisdiction in the matter.

12. Although the language of law is very clear on the face of it and does not require any authority we have been able to lay hands on the judgment of the Supreme Court in Grain Systems (Pvt.) Ltd. v. Agricultural Development Bank 1993 SCMR 1996 expressing the view that a suit for recovery of loan pending in a Civil Court should be transferred to Special Court constituted under provisions of Ordinance, 1979 by Civil Court in exercise of its inherent jurisdiction. As the question raised stands conclusively determined by the verdict of the apex Court, respectfully following the view we hold that final decree and the entertainment of execution proceedings in the suit filed by respondent No.1 by the Civil Court shall stand transferred to the Special Court constituted under the Ordinance, 1979 at Hyderabad for further proceedings strictly in accordance with law.

13. Learned counsel for the petitioner being initially unaware of the notification, dated 1‑10‑1992 also raised the question of jurisdiction of the Civil Court in the context of section 25(2) of the Ordinance, 1961 read with section 172 of the Sindh Land Revenue Act, 1967 but we think that the contention raised is without any substance: In any event the issue raised relates to the recovery of a loan as arrears of land revenue which might be agitated before the Special Court in the suit itself or the execution of decree that may follow. In any event the submission cannot be entertained by this Court in the exercise of extraordinary jurisdiction.

14. Subject to aforesaid observations the petition is allowed and parties are directed to approach the Special Court (Banking), Hyderabad for the resolution of the dispute pending before the Executing Court within thirty days. Q.M.H./M.A.K./A‑294/K Petition allowed.