2014 PLP 1255 (CLD)

AZIZ-UR-REHMAN, J.

This is a suit filed by the plaintiff Bank against defendants for recovery of Rs.810,579,752 under section 9 of the Financial Institutions [Recovery of Finances] Ordinance, 2001 with the following prayers:-- (a) to declare the suit for recovery of Rs.810,579,752 with future cost of fund at the prevailing rate as prescribed by SBP from the date of default until the realization of the decretal amount; (b) to decree the suit for the enforcement of the Personal Guarantees; (c) to decree the suit, for the sale of the secured properties as specified in Paragraph 11 herein above; (d) to decree the suit, for the enforcement of the security documents and the realization of the hypothecated assets as specified in paragraph 9, of the plaint. (e) to decree the suit for recovery of all other amounts owed by the defendants to the plaintiff pursuant to the Finance Facilities granted by the plaintiff to defendant; (f) costs of the suit; and (g) in case the sale proceeds are found insufficient to recover the amount due to the plaintiff bank, the remaining amount be ordered to be recovered from the defendants as arrears of land revenue; but not limited to their arrest and detention; (h) any other relief this Hon'ble Court may deem fit and proper in the circumstances of the case.

2. Brief facts leading to the above prayers are:-

3. Per assertions, of Habib Metropolitan Bank Ltd [in short HMBL] is a 'Banking Company'/'Financial Institution' incorporated under the Companies Ordinance, 1984 [XLVII of 1984], which transacts the business of banking in Pakistan as defined under section 2(a)(i) of the Financial Institutions [Recovery of Finances] Ordinance, 2001 [XLVI of 2001], having its principal office at Spencer's Building, I.I. Chundrigar Road, Karachi.

4. That defendant No.1 viz. Messrs HAY's [Pvt.] Limited [in short HAY's] is a customer of HMBL in terms of section 2(c) of the Financial Institutions Ordinance, 2001 [XLVI of 2001] since, 1995 and at the request of the HAY's, HMBL approved the provision of certain finances vide certain Facility Letters in order to facilitate its working capital and export/import related requirements and HAY's accepted inter alia the terms and conditions of the said Facility[ies] availed. The defendants Nos.2 to 4 have been joined in their capacity as guarantors while, defendants Nos.5 to 9 have been impleaded in their 'dual capacity' as guarantors and mortgagors in the instant suit.

5. That various Finance Facilities granted to and availed/renewed at the request of defendants from time to time by HMBL, no doubt, were fully utilized and availed by defendant No.1 [HAY's].

6. According to the Plaintiff Bank, the various facilities as being fully described/detailed in para 15 of the plaint a sum of Rs.810,579,752 as on 30-9-2012 is due and payable by the defendants jointly and severally to the Plaintiff Bank [HMBL].

7. For and regarding the availment of various facilities i.e. RF, DF, TF, PACKING CREDIT, FERD-LC, FAFB, the defendant No.1 amongst others duly signed and executed various finance agreements, demand promissory notes, facility letters, undertakings, indemnity for discount and purchase bills etc. all dated 15-4-2010 in favour of the Plaintiff Bank [Annexures 'D-1' to 'D-20' to the plaint].

8. Besides, in order to secure the aforesaid facilities HAY's also created charge of hypothecation over all, past and future assets [including machinery, equipment, spares, goods, merchandise, stocks, raw materials, work-in-progress, finished and unfinished goods] as well as present and future receivables as described in para 8 of the plaint in favour of HMBL.

9. The relevant documents regarding creation of hypothecation are the letter of hypothecation and supplementary letter of hypothecation [Annexures 'E-1' and 'E-2' to the plaint]. For the charge so created the defendant No.1 [HAY's] also got the charge registered with Security Exchange Commission of Pakistan [in short SECP]. The documents of different dates are comprising certificate of registration of mortgage/charges and acknowledgments [Annexure 'F/1' to 'FIT to the plaint].

10. To further secure the facilities granted to and availed by defendant No.1 [HAY's], the defendants Nos.5 to 9, per assertions, deposited their original title deeds of their respective properties [i.e. Property No.1 to Property No.6] by way of creating equitable mortgage in favour of HMBL. The properties so mortgaged with HMBL are described in para 11 of the plaint are as follows:-- (i) Property bearing Plot No.F/546-A, measuring 1 acre, situated in S.I.T.E Karachi; (ii) Property bearing Plot No.B-167, measuring 10 acres, situated in S.I.T.E., Nooriabad; (iii) Property bearing Bungalow at Plot No.28/64, measuring 320 Sq. Yards situated in Survey Sheet No.35P/1, Block 7 and 8, Bihar Muslim Cooperative Housing Society Ltd, Karachi; (iv) Property bearing Bungalow at Plot No.35/288, measuring 165 Sq. Yards, situated in Survey Sheet No.35-P/1, Block 7 and 8, C.P. & Berar Cooperative Society Ltd, Karachi; (v) Property bearing Bungalow on Plot # A-426, measuring 160 Sq. Yards, situated in Block 19, KDA Scheme No.24, Gulshan-e-Iqbal, Karachi; (vi) Property bearing Plot No.A-31, measuring 500 Sq. Yards, situated in Khayaban-e-Abbasi, Phase-VII, Defence Housing Authority, Karachi;

11. The mortgagors [defendants Nos.5 to 9] per assertions besides depositing the title deeds of the afore said properties [i.e. serial No.'i' to serial No.'vi'] also signed and executed Memoranda of Deposit of Title Deeds [MOTDs], all dated 15-4-2010 regarding the aforesaid mortgaged properties [Annexure 'G/1' to G/5' to plaint]. Apart from the above, Memoranda of Deposit of Title Deeds, the registered mortgage deed in respect of properties Nos.'i', 'iii' and 'iv', were also signed and executed by defendants Nos.5, 6 and 9 [Annexures 'G/6' to 'G/8' to the plaint].

12. Likewise, for the financial facility[ies] granted to and availed by defendant No.1, the defendants Nos.2 to 9 also signed and executed Letter of Guarantees i.e. [Annexures 'H-1' to 'H-8' to the plaint]. Under the terms and conditions thereof, the defendants Nos.2 to 9, in their capacity as guarantors are also liable for the due payment and discharge of the liabilities of Messrs HAY's (Pvt.) Ltd.

13. All the defendants were called upon vide demand/legal notice date 16-7-2012 to pay the outstanding dues but they failed/ignored and/or avoided to effect payment or otherwise, respond the legal/demand notices as such the defendants, per plaintiffs assertion, committed 'default' of their obligations/undertaken.

14. Hence the instant suit was filed on 24-10-2012.

15. Upon filing of the above suit, process under section 9(5) of the Financial Institutions [Recovery of Finance] Ordinance, 2001 was issued to the defendants in all four modes. The relevant record i.e. receipts of courier, Registered post A.D and publication in newspapers i.e. 'The News [English] dated 7-11-2012 and 'Daily Jang' Karachi 7-11-2012 are available on record. Notwithstanding, service, however, no leave to defend application within 30 days' i.e. in terms of section 10(2) was filed by any of the defendants.

16. Under law when a defendant despite service fails to come forward and file leave to defend application in the form of a 'written statement' per section 10(3) of F.I.O., 2001 and obtains leave from the Banking Company for defending the suit in terms of section 10(2) of F.I.O., 2001, then the allegations of fact in the plaint are deemed to be admitted and the Banking Court thereafter may pass a decree in favour of the Bank. Section 10(1) of F.I.O., 2001 read as follows:-- "

10. Leave to defend.

(1) In any case in which the summons has been served on the defendant as provided for in subsection (5) of section 9, the defendant shall not be entitled to defend the suit unless he obtains from the Banking Court as hereinafter provided to defend the same; and, in default of his doing so, the allegations of fact in the plaint shall be deemed to be admitted and the Banking Court may pass a decree in favour of the plaintiff on the basis thereof or such other material as the Banking Court may require in the interests of justice." [Underlining is mine].

17. In terms of section 9(5) of F.I.O., 2001, service duly effected in any one of the modes i.e. through bailiff or process server of Banking Court, by a registered acknowledgement due, by courier and by publication in one English language and one Urdu language daily newspaper, shall be deemed to be a valid service. For the purpose of F.I.O., 2001, in the instant case process was issued under section 9(5) of F.I.O., 2001 but none of the defendants filed any leave to defend application for defending the above suit within 30 days of the date of service. Regarding this aspect of the matter reliance can be placed on the case of Messrs Union Bank of Middle East Limited v. Messrs Zubna Limited and 3 others [PLD 1987 Kar. 206] wherein observations read as follows:-- "I am, therefore, of the view that the summons and notices shall be issued to the defendants simultaneously through bailiff, by registered post A.D. and by publication. It is the statutory requirement and it must be complied with. Once it is shown that the summons or notices have been issued by the office, the service on the defendant by anyone of the three modes will be considered as service on the defendant. The question that the plaint cannot be annexed in the case of publication should not be held to be an impediment in holding such service to be good inasmuch as, firstly, the copy of the plaint has been annexed to the summons sent to the defendant through bailiff as well as by registered post and secondly, the defendant is on notice to collect the copy of the plaint from the office and, in any case, there can be no impediment in making just an application for leave to defend, even without a copy of the plaint, within the statutory period. The grounds for leave to defend may be submitted later on, after the receipt of the copy of the plaint." [Underlining is mine].

18. Moreover, in the case of Messrs AHMAD AUTOS and another v. ALLIED BANK OF PAKISTAN LIMITED [PLD 1990 SC 497], the Hon'ble Supreme Court of Pakistan while, upholding the view taken in the case supra [PLD 1987 Kar. 207] further observed as follows:-- "9.... It is a matter of common knowledge that defaulter borrowers in suits brought against them particularly by the financial institutions used to delay the disposal of the suits by avoiding the service of the summons. In order to expedite the disposal of the suits to be brought by the Banking Companies the Ordinance was promulgated, which contains special provisions and which inter alia provide that a suit brought by a Banking Company for the recovery of loan is to be tried in summary manner under Order XXXVII. Section 15 of the Ordinance empowers the Federal Government by a notification in the official Gazette to make rules for carrying out the purposes of the Ordinance. In pursuance whereof the rules have been framed. The underlined object of Rule 8 is to avoid the delay in the service of the summons and, therefore, it has been provided that the summons are to be issued simultaneously in three different modes referred to here in above, which is the requirement of the above rule. Obviously for the reason that if the summons is not served through a bailiff or by a registered post acknowledgement due, it would be served in any case by publication. In other words, the service is to be held good if a defendant is served by any of the above three modes of service provided for in Rule

8. The unamended Rule 8 was silent on the question, whether in order to hold service of summons good, it should be effected by all the three prescribed modes or whether service of the summons by one of the modes was sufficient. In the case of Messrs Allied Bank of Pakistan Limited v. Messrs Tahir Traders and 8 others reported in PLD 1986 Kar. 369 a learned Single Judge of the Sindh High Court had taken the view that mere publication of summons under Rule 8 would not be a proper service unless it was proved that defendant was avoiding the service of summons issued through bailiff and registered post or his whereabouts were not known. A contrary view was taken in a subsequent case referred to here in above namely in the case of Messrs Union Bank of Middle East Limited v. Messrs Zubna Limited and 3 others PLD 1987 Kar. 206, relevant portion of which has been quoted here in above. The framers of the Rules by amending Rule 8 by S.R.O. No. 71(1)/88 dated 31-1-1988 have resolved the above controversy. It may be advantageous to reproduce the original rule and the addition made by the above S.R.O. dated 31-1-1988 which read as follows:-- (original Rule 8 as framed) "

8. Mode of service of summons and notice.

The Reader shall, on receipt of a plaint, order immediate issue of summons and notices to the defendant simultaneously through the Bailiff of the Court, by registered of the post acknowledgement due and by publication, "and service in any aforesaid modes shall be deemed proper and valid service for the purposes of the Ordinance." (Underlining is ours and is the addition made by S.R.O. No.71(1)/88 dated, 31-1-1988) 10. ....However, we may point out that there was no need to amend the above Rule 8 as the correct legal position was that the service was to be held to be good service if it was effected by any one or more modes of service provided for in the above-quoted Rule

8. If we were to take a contrary view, it would be in conflict with the object of the Ordinance and the Rules framed thereunder, as it would make the service more difficult. It would instead of suppressing the mischief which prompted the framing of above Rule 8, would encourage the mischief as a defendant may successfully avoid service by one of the above three modes of service for considerable period by maneouvring. 11..... that we are unable to subscribe to his submission that Rule 8 is violative of Order XXXVII, C.P.C. The above Rule 8 has been competently framed by the competent authority. It does not violate in any way Order XXXVII or any other Provision of the C.P.C. It may be pertinent to point out that section 129 of the C.P.C. itself contemplates that the orders and the rules provided in the C.P.C. can be amended by the chartered High Courts by framing rules relating to their original civil jurisdiction. Framing of Rule 8 in pursuance of the statutory powers contained in section 15 of the Ordinance seems to be in consonance with the above section

129. The object of the above Rule 8 as pointed out hereinabove is to avert delay in effecting service of the summons, which object is in consonance with the proviso 2 to Rule 13 of Order IX, C.P.C. incorporated by the Law Reforms Ordinance, 1972, providing (Ordinance XII of 1972) which provides that:-- "Provided further that no decree passed ex parte shall be set aside merely on the ground of any irregularity in the service of summons, if the Court is satisfied, for reasons, to be recorded, that the defendant had knowledge of the date of bearing in sufficient time to appear on that date and answer the claim." [Underlining is mine].

19. In the instant case the defendants were summoned to obtain leave from the court within 30 days from the service to defend the suit and within such time to cause any appearance. In the event of default i.e. non-filing of leave to defend in the form of 'written statement', the plaintiff will be entitled at any time after the expiration of such 30 days' to obtain a decree with costs together. Notwithstanding service of summons, the defendants failed, ignored and/or avoided to obtain leave from the banking court within 30 days from the service of summons. Publication of summons in the present case, no doubt, took place in wide circulation of newspaper i.e. daily The News English and daily JANG Karachi both dated 7-11-2012.

20. Under section 9(5) of F.I.O., 2001 in the case of service of summons through bailiff or the process server a copy of the plaint needs to be attached with the summons, however, in all other modes of service the defendants or any of them as a right obtained copy of the plaint from the office and that too without making any written application but simply against an acknowledgment. In view of this position it can ipse dixit be presumed that the defendants were duly served with the summons.

21. Nevertheless, on 22-10-1013, when the above suit came up before the court for final disposal, the following order was passed:-- Learned counsel for the plaintiff is directed to file facility-wise break-up of liabilities showing therein 'sale price', 'purchase price', amounts repaid by customer regarding each facility, the amounts of other charges, if any, balance amount repayable i.e. principal and mark-up outstanding during the validity period of each finance agreement [i.e. upto expiry date of each finance agreement] and the amounts of mark-up charged beyond expiry dates of each finance facility before the next date of hearing." [Underlining is mine].

22. The Plaintiff Bank [HMBL] in compliance with the aforesaid order filed 'facility-wise break-up of liability' i.e. RF, TF, FCY Export Bills [Purchased] FAFB and Forced PAD on 14-12-2013 which, indeed, is available on record.

23. On 27-3-2014 when the above suit came up before me I heard Mr. Rabail Zeeshan Akhund, learned counsel for the Plaintiff Bank and with his valuable assistance gone through the available record before me.

24. In absence of any leave to defend application, per Mr. Rabail Zeeshan Akhund, the assertions, made in the plaint are deemed to be admitted and consequently, the Plaintiff Bank's suit deserves to be decreed along with cost of fund' from 'date of 'default' till realization'. No doubt, bank is entitled to claim 'cost of fund' from the date of 'default' till realization' but for such entitlement Bank, has to establish the 'date of default'. Such default either can be established from the 'repayment schedule' of the Finance Agreement(s) or from the statement of accounts and/or Sanction Advice/Offer Letter. The 'Repayment Schedule' it is needless to say, is an inseparable part of a Finance Agreement. In the case in hand the 'common clause 3' of the Finance Agreements reads as follows:-- "

3. The purchase price shall be paid by the Customer to the Bank in such manner and on such dates, or in such instalments, as may be specified by the Bank in the Sanction Advice/Offer Letter or from time to time by the Bank at its absolute and unfettered discretion."

25. In the instant case, it worth to note, the date of 'default' is not specified. Hence, the date of 'default' in my view would be the date on which each of the Finance Agreements expires i.e. 31-3-2011 as far as the present case is concerned.

26. Mr. Rabail Zeeshan Akhund, learned counsel for HMBL while, arguing the case further submitted that in consideration of and in acknowledgment of availing of financial facilities and as security thereof, apart from finance agreements, personal letter of guarantees, MOTDs, letter/supplementary letter of Hypothecation, defendant No.1 has also signed and executed Demand Promissory notes, undertaking and indemnity for discount purchase bills in favour of the Plaintiff Bank. All these documents, per learned counsel, have been duly signed and executed voluntarily and without any coercion. As such, it is obligatory upon all the defendants not only to perform their undertakings but also to fulfil their promises vis-a-vis repayment of the outstanding amounts.

27. Moreover, in respect of immovable properties i.e. Properties Nos.1, 3 and 4 the mortgagors [defendants Nos.5, 6 and 9] apart from MOTD's have also executed registered mortgaged deeds in favour of HMBL, [Annexure G/6 to G/8]. Per learned counsel, the defendants have neither denied the documents signed and executed by them nor availing of any of the facilities granted to and availed by defendant No.1. According to learned counsel, the decretal amount is recoverable through sale of the mortgaged/hypothecated goods, properties etc. mentioned in paras 8 and 11 of the plaint.

28. To properly appreciate the arguments of the learned counsel for the plaintiff at this juncture, I would like to refer to section 58(f) of the Transfer of Property Act, 1882 [VI of 1882]. Under section 58(f) of Transfer of Property Act, 1882 [VI of 1882], delivery of title documents of immoveable properties to a creditor or his agent, with an intent to create security thereon, is called 'mortgage' by deposit of 'title deeds'. From reading of section 58(f) of Transfer of Property Act, 1882, [VI of 1882], it is crystal clear, that even Memorandum of Deposit of Title Deeds is not a requirement of law. The plaintiff in the present case has fully established the creation of valid mortgage in respect of all other properties except Property No.6 i.e. Plot No.A-31, measuring 500 Sq. Yards, situated in Khayaban-e-Abbasi, Phase VII, Defence Housing Authority, Karachi. Regarding Property No.6, neither any MOTD nor any title document has been placed on record. As such the plaintiff is entitled to have a 'final decree' for sale of hypothecated goods mentioned in para 8 of the plaint and immovable properties described/mentioned in para 11 of the plaint except the aforesaid Property No.6.

29. No doubt, under section 10(4) clause (b) and 'Explanation' provided thereto the bank can validly and in the first instance, adjust the amount received from customer against other amounts of finance. The remaining if left, thereafter, can be adjusted against the 'principal amount' of finance. Clause (b) of section 10(4) and 'Explanation' thereto read as follows:-- "Clause (b) of section 10(4), F.I.O., 2001 (a)

(b) the amount of finance and other amounts relating to the finance payable by the defendant to the financial institution up to the date of institution of the suit; (c)

(d)

Explanations.

For the purpose of clause (b) any payment made to a financial institution by a customer in respect of a finance shall be appropriated first against other amounts relating to the finance and the balance, if any, against the principle amount of the finance.

30. Needless to say that in the Contract Act 1872 [IX of 1872] or in any other law there is nothing to prohibit the parties or the bank from varying or altering the terms of the original contract or executing a new contract to substitute the old one for the purpose of renewal of the facility[ies].

31. While going through the documents, there appear some blanks, however, they are not of any material nature to dilute or invalidate the claim put forward by the Plaintiff Bank in entirety. On this aspect of the matter reliance can be placed on the case of MUHAMMAD ARSHAD and another v. CITIBANK N.A., LAHORE [2006 SCMR 1347] wherein it was held as follows:-- "

4. The question which arises here at this juncture would be that as to why certain columns were left blank and if it was so done why the incomplete agreement was signed by the petitioners? No answer could be given by the learned Advocate Supreme Court on behalf of the petitioners. In our considered view the plea of "blank columns" would hardly renders any assistance to the case of petitioners. In view of the provisions as contained in section 20 read with section 118 of the Negotiable Instruments Act, 1881 no benefit could be given to the petitioner on the ground that the agreement was not completely filled in when executed as it would have no substantial bearing on the validity of the agreement. In this regard reference can be made to case Muhammad Sarfraz Khan Rana v. Government of the Punjab PLD 1990 Lah.

88. It is well-settled by now that "Negotiable Instruments Act provides that where one person signs and delivers to another paper stamped in accordance with law, either wholly blank or having written thereon incomplete negotiable instrument, in order that it may be made, or completed into negotiable instrument, he thereby gives prima facie authority to person who receives that paper to make or complete it as case may be into negotiable instrument for any amount. Furthermore, section 118 of Negotiable Instrument Act, provides that presumptions are attached to negotiable instruments, which, inter alia includes that negotiable instrument was made or drawn for consideration and that every instrument bearing date was made or drawn on such date. Held: Documents were given blank as canvassed by appellants even then appellants are estopped to challenge legality, validity and genuineness of said documents. [Underlining is mine]. ......

32. Besides, in the case of UNITED BANK LTD v. Messrs SARTAJ INDUSTRIES through Qaisar Iqbal, Managing Partner and 6 others [PLD 1990 Lahore 99], it was held as under:-- ...... "20.... The statement of account annexed with the plaint which has been certified under the Bankers' Books Evidence Act, shows these deposits as having been made by the defendants and thus presumption of correctness has to be attached thereto when the entries have not in any manner whatsoever been rebutted by the defendants. The aforesaid deposits shall have to be therefore taken as having been made by the defendants on the dates on which these are shown to have been made in the books of accounts of the plaintiff Bank " [Underlining is mine].

33. As far as liability of guarantors are concerned in terms of personal letters of guarantee their liabilities are co-extensive with that of defendant No. l. Being relevant clauses 2, 3, 17 (b) and clause 20(c) therefrom are reproduced as under:-- "

2. My liability under this guarantee shall be co-extensive with that of the customer and you may at your option, hold me primarily responsible for the secured debt as the principal debtor. (3) This guarantee shall continue to remain binding on me until receipt by you of a written notice from me of discontinuance hereof and notwithstanding such notice, I shall continue to remain liable to you for all sums due and owing to you by the customer upto the time of receipt by you of such notice and also for any contingent liability undertaken by you on behalf of the customer even though such liability may have matured and honoured by you after that debt. (17) Where the finance provided by you to the customer as aforesaid is in any currency other than Pak Rupees:- (a) ........................................ (b) If I fail to pay you such amount in foreign currency as aforesaid you will be entitled, but not obligated to recover from me the equivalent amount in Pak Rupees converted at such rate as you may, in your absolute and unfettered discretion deem appropriate and I undertake to accept such conversion without any question and waive my right, if any, to question, query or dispute the same. (c) ........................................ (20) ........................................ (a) ........................................ (b) ........................................ (c) Where the guarantee is given by more than one person the liabilities of all the guarantor shall be joint and several and all the rights vested in your favour hereunder may be exercised by you jointly and severally against all the guarantors. [Underlining is mine]. ........

34. For and regarding this aspect of the matter, the relevant passage from the case of Messrs HUFFAZ SEAMLEN PIPE INDUSTRIES LTD. and 2 others v. Messrs SECURITY LEASING CORPORATION LTD. [2002 SCMR 1419] reads as follows:-- "

17. As regards contract of guarantee, rights and liabilities of the parties are to be determined with reference to terms and conditions of the guarantees. The guarantors cannot take advantage of any condition incorporated in the principal agreement, unless the same is reflected in a contract of guarantee executed by the guarantors, as liabilities of the principal and of guarantors though arising from the same transaction, are distinct. In an action by a creditor against a guarantor the former is only required to establish the liability of the principal debtor and occurrence of default or breach of the terms leading to the liability. The guarantor cannot resort to technicalities to defeat the claim of the creditor. Even where the contract becomes unenforceable against the principal debtor, yet, the guarantor would still be liable for the surety he had executed, unless there was any covenant to the contrary." .......

35. Keeping in view the submission, at this point of time, I would like to refer to clause (e) of section 2 of F.I.O., 2001 which reads as follows:-- (a) ........................................ (b) ........................................ (c) ........................................ (d) ........................................ "(e) "obligation' includes:- (i) any agreement for the repayment or extension of time in repayment of a finance or for its restructuring or renewal or for payment or extension of time in payment of any other amounts relating to a finance or liquidated damages; and (ii) any and all representations, warranties and covenants made by or on behalf of the customer to a financial institution at any stage, including representation, warranties and covenants with regard to the ownership, mortgage, pledge, hypothecation or assignment of or other charge on assets or properties or repayment of a finance or payment of any other amounts relating to a finance or performance of an undertaking or fulfillment of a promise; and [Underlining is mine]. (iii) all duties imposed on the customer under this Ordinance; and (f) "rules" means rules made under this Ordinance.

36. Mere perusal of the above would shows that a customer is not only duty bound to perform his undertakings but also under obligation to fulfil his promises strictly in terms of clause (e) of section 2 of F.I.O., 2001 [XLVI of 2001] and the documents executed by a customer in respect of repayment of dues and other amounts relating to a finance granted to and availed by a customer.

37. Mr. Rabel Zeeshan Akhund, learned counsel for Plaintiff Bank, next argued in vehemence that the Plaintiff Bank [HMBL] is also entitled for attachment and sale of the hypothecated goods and assets. According to the learned counsel, the security offered under the letter/supplementary letter of hypothecation besides continuing security is for all money granted to and availed by the defendant No.1 from time to time and still due and payable to Plaintiff Bank. Moreover, the Plaintiff Bank is also entitled to have a decree in respect of the mortgaged properties mentioned in para 11 of the plaint. Regarding this contention of the learned counsel, in para 28 hereinabove, I have already held that Plaintiff Bank is entitled to have a final decree in its favour for sale of the hypothecated goods mentioned in para 8 of the plaint as well as immovable properties mentioned in para 11 of the plaint except Property No.6 i.e. Plot No.A-31, measuring 500 Sq. Yards, situated in Khayaban-e-Abbasi, Phase-VII, Defence Housing Authority, Karachi.

38. Per break-up of liability the recoverable principal amount as on 30-9-2012 and markup as on 30-3-2011 in terms of finance agreements are as follows:-- S. No. Name of facility (in Rs.) Principal amount as on 30-9-2012 (in Rs.) Markup due and payable for the period from 30-12-2010 to 31-3-2011 (i.e. expiry date) (in Rs.) Amount Outstanding upto 30-3-2011 (in Rs.)

1. Running Finance 129,209,961 1,762,458 130,972,419

2. Term Finance (TF-1) 208,990,000 16759,588 225,749,588 (TF-2) 33,858,000 2,684,619 36,542,619

3. Packing Credit (PC) 116,100,000 4,092,173 120,192,173

4. FCY Export Bills (purchased) (a) LC Sight 2,249,877 147,416 2,397,293 (b) LC Usance 8,220,631 311,933 8,532,564

5. FAFB 29,797,000 2,475,052 32,272,052

6. Forced Paid (Past due acceptance) 100,664,148 3,774,977 104,439,125 Total 669,630,397

39. On summing-up the figures given in the last column comes to Rs.661,097,833 and not Rs.669,630,

397. As far as the entries made in the certified statement of accounts are concerned, of course, presumption of correctness is attached thereto but such presumption attached to the statement of accounts is only to the extent that the entries/figures made in the statement of accounts are true per the book of accounts. However, merely on the basis of such presumption the bank's suit cannot be straight away decreed as prayed.

40. The Plaintiff Bank per break-up of liabilities given in para 15 of the plaint/certified statement of accounts, has also claimed/debited other charges and EDS charges but the same are declined for want of requisite documents and proof thereof. I am of the considered view that in absence of materials, vouchers etc the same cannot be granted.

41. Under law the payment of 'penalty' in the event of delay in payment of agreed purchase price, is prohibited in Islamic System of Finance read with in juxtaposition of Circular 32 dated 26th November, 1984. Mark up as claimed by HMBL beyond the date of expiry of finance agreements cannot be allowed. Even in absence of leave to defend application in terms of section 10(2) of F.I.O., 2001, courts are supposed to do justice and not perpetuate injustice as the jurisdiction is vested in courts is to advance the cause of justice instead of causing mis carriage of justice.

42. Upon hearing Mr. Rabail Zeeshan Akhund, learned counsel for Plaintiff Bank and perusal of record I am of the considered opinion that the Plaintiff Bank is entitled to have a decree in its favour. Under circumstances, the plaintiff suit is decreed for in the sum of Rs.661,097,833 [Rupees Six Hundred Sixty One Million, Ninety Seven Thousand and Eight Hundred Thirty Three only] against the defendants jointly and severally plus cost of funds in terms of section 3(2) of F.I.O., 2001 from 31-3-2011 till realization of the decretal amount. Final decree for sale of the hypothecated assets/goods and mortgaged properties mentioned in paragraphs 8 and 11 respectively of the plaint [except Property No.6 i.e. Plot No.A-31, measuring 500 Sq. Yards, situated in Khayaban-e -Abbasi, Phase-VII, Defence Housing Authority, Karachi] is also passed for recovery of the decretal amount including cost of fund and cost of the suit. Suit stands decreed. MH/H-21/Sindh Suit decreed.