1987 PLP 2953 (MLD)

The second case is of Azmat Wall v. Adawi and 2 others reported in 1983 C L C 546, where Nasir Aslam Zahid, J. has summed up the general principles for grant of leave in the following terms:- "Following general principles can be enunciated in regard to the grant or refusal of leave to defend a suit filed under Order XXXVII of the Civil Procedure Code, 1908; (a) If no defence is spelt out, on facts or in law, in the application for leave to defend or documents filed by the defendant, leave is to be refused. Result will be that the suit shall be decreed; (b) if any kind of defence is made out, be it plausible or even illusory, the defendant is to be granted leave to defend the suit; (c) if leave is to be granted to the defendant to defend the suit, it can be unconditional leave or conditional, depending on the strength of the defence, whether on facts or in law, is made out, unconditional leave is, as a general principle, granted; (d) even if the defence is plausible, leave may not be granted unconditionally if the conduct of the defendant is mala fide or is not free from suspicion; (e) if a defence is set up which is not plausible, leave to defend should not be refused but should be granted on condition of furnishing security or deposit of amount. Such cases will be where to adopt the words employed by the Supreme Court of Pakistan in P L D 1963 S C 163 'the defence set up be vague or unsatisfactory or there be a doubt as to its genuineness; (f) whether conditions are imposed or unconditional leave to defend is granted, the appellate Court generally does not interfere as this is the discretion to be exercised by the trial Court. If, however, the discretion is exercised arbitrarily, the appellate Court will interfere; (g) a suit can be filed under Order XXXVII, C.P.C. on the basis of a promissory note even if it was given as collateral security for repayment of a loan. Mere argument that it was a collateral security will not entitle the defendant the right to defend the suit." 4.To say least this ruling does not help the defendant at all and on the contrary goes against him because it has been held in very clear terms that if no defence is spelt out on facts or in law in the application for leave to defend or documents filed by the defendant then leave is to be refused. It was further clarified that a suit can be filed under Order XXXVII, C.P.C. on the basis of promissory note even if it was given as a collateral security for repayment of the loan. Mere argument that it was a collateral security will not entitle the defendant the right to defend the suit. The third ruling is in case of Mohammad Hussain v. City Bank reported in 1985 C L C 2467 in support of the contention that condition of furnishing security should not be imposed in a case where the loan was already secured by means of a mortgage. This ruling also does not help the defendant because it has been made clear that it was the quality of the defence and not the extent of security which should be the governing factor in such cases. 5.It was rightly pointed out by the counsel for the plaintiff that the case of the plaintiff is fortified by a number of documents including promissory notes, acknowledgments, pledge-deed, letters, statements of accounts produced by the Plaintiff. The execution of almost all 'of these documents was admitted by the defendant or was at least not denied. So much so that he had not denied the documents "~ in which even the last debit balance was admitted by him. In the face of all these documents and their non-denial, further coupled with the fact that the defendant has not denied having obtained loan/O.D. facility and having utilized the same, there remains no defence what to say of a plausible defence, with him.

6. So far as the question of interest is concerned it was stated by the Advocate for the plaintiff from bar that interest has not been charged in excess of the agreed rate and that such a statement hall been made in the plaint which has been verified on oath. 7.Under these circumstances I am of the clear view that the defendant has not been able to set up any defence and is therefore not entitled to leave for appear and defend the suit. I, therefore, dismiss his application for leave to defend the suit. As a result of c the dismissal of the application the suit of the plaintiff is decreed as prayed with interest at 14$ per annum with quarterly rest from the date of the suit till payment and also with costs. These are the reasons for the short order dated 17-8-1987. M . Y . H . / H-60/ K Petition dismissed.