2013 PLP 1684 (CLD)
MUHAMMAD HUSSAIN and another — Appellants Versus JUDGE BANKING COURT NO.1 MULTAN and 3 others — Respondents
| Citation | 2013 PLP 1684 (CLD) |
| Forum / Court | Lahore |
| Bench Members | N/A |
| Parties | MUHAMMAD HUSSAIN and another — Appellants Versus JUDGE BANKING COURT NO.1 MULTAN and 3 others — Respondents |
| Primary Law | Financial Institutions (Recovery of Finances) Ordinance (XLVI of 2001) |
Q1: What are the key laws and sections cited in 2013 PLP 1684 (CLD)?
This judgment primarily cites: Financial Institutions (Recovery of Finances) Ordinance (XLVI of 2001) as referenced in Pakistani case law index.
Q2: Which judicial bench decided the case 2013 PLP 1684 (CLD)?
The case was heard and decided by the Lahore bench comprising: N/A.
Q3: What is the official citation format for this judgment on Pakistan Law Portal?
Cite this legal precedent as: 2013 PLP 1684 (CLD) (MUHAMMAD HUSSAIN and another — Appellants Versus JUDGE BANKING COURT NO.1 MULTAN and 3 others — Respondents). Read the full summary and cross-referenced laws free on Pakistan Law Portal.
Laws Cited
Representation
- Muhammad Waseem Shahab for Respondent No.2.
- Ahmad Nadeem Khan for Respondent No.4.
- 4. Learned counsel for respondent No.4 contends that he was bona fide purchaser and passed his title to the appellants against a lawful consideration.
Headnotes / Summary
Ss. 15 & 23
Transfer of Property Act (IV of 1882), S.52
Bona fide purchaser
Scope
Suit for recovery was decreed whereafter during execution proceedings, the appellants made application to the effect that they were bona fide purchasers of the suit property and were not aware of the decree
Contention of the appellants was that when they had purchased the mortgaged property they had taken all precautions before the purchase and had no knowledge of the decree and there was no mention in the record of rights of any charge created over the property by the Bank , and therefore, the said property could not be cast away for satisfaction of the decree
Appellants had purchased the mortgaged property three months after the passing of the decree
Under S.23 of the Financial Institutions (Recovery of Finances) Ordinance 2001, a suit was automatically converted into an execution application and no formal application was required to be made by the Bank
Appellants had purchased the suit property at a rate less than the one paid by the previous purchaser, and therefore, purchase did not seem to be bona fide
Principle of lis pendens, in the present case, defeated the right of the appellants
Appeal was dismissed.
Judgment & Decree
IJAZ AHMAD, J.
Respondent No.3 availed loan facility amounting to Rs.16,00,000 from respondent No.2. Instead of mortgaging the property of the loanee, only a memorandum of deposit of title deeds of the property was entered. Respondent No.3 failed to repay the loan. Respondent No.2 instituted a suit for recovery of the money on 26-8-2010. The suit was decreed in favour of respondent No.2 vide judgment and decree dated 27-4-2009, passed by the learned Judge Banking Court-I, Multan. The property whose documents had been deposited, which finds mention in paragraph No.4 of the loan agreement was transferred by respondent No.3 in favour of respondent No.4 vide registered sale deed dated 18-8-2008. It was purchased by the appellants from respondent No.4 through a registered sale deed 27-7-2009.
2. It is contended by the learned counsel for the appellants that the appellants are bona fide purchasers without notice of any charge/encumbrance on the property in question; that the appellants had taken all precautions before purchasing the property and they had no knowledge of the decree; that the copy of records of rights for the year 2003-2004 carried no mention of any charge created on the property by the bank; that in such a situation the property in question cannot be cast away for the satisfaction of the decree. Relies on Khalid Adeeb Khanam v. Messrs Prudential Investment Bank Ltd. and others 2002 CLD 451.
3. On the other hand it is contended by the learned counsel for the respondent-bank that the appellants have purchased the property in question on 27-7-2009, i.e. three months later to the decree dated 27-4-2009; that the principle of bona fide purchasers does not override the principle of lis pendens; that respondent No.4 purchased the property on 18-8-2008 for a consideration of Rs.26,00,000, the appellants purchased the property almost 11 months later at a price, Rs.6,00,000 less. This does not show bona fide of the appellants in purchasing the property. Relies on Risaldar Ghazi Khan and another v. Abdur Rehman and another (1984 CLC 1615).
4. Learned counsel for respondent No.4 contends that he was bona fide purchaser and passed his title to the appellants against a lawful consideration.
5. We have heard the learned counsel for the parties and also gone through the record. The appellants purchased the property in question three months later to the passing of the decree. The detail of the property has been mentioned in paragraph No. 4 of the plaint. Under section 23 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 a suit is converted into an execution application and no formal application is required to be made. The appellants purchased the property at a rate less than the one paid by respondent No.4 to respondent No.3. The purchase does not seem to be a bona fide one. Relying on Risaldar Ghazi Khan and another v. Abdur Rehman and another (1984 CLC 1615) we are of the view that principle of lis pendens defeats the right of the appellants. They claim to be bona fide purchasers which they are not. This appeal has no merits, therefore, the same is dismissed. KMZ/M-76/L Appeal dismissed.