1988 PLP 1214 (CLC)

‑‑‑S. 12‑‑Civil Procedure Code (V of 1908), O.XXXVII, R.4‑ Conditional leave to defend suit‑‑Condition not fulfilled‑‑Preliminary decree granted against defendants as obtaining of loan and execution of documents had been admitted‑‑Such preliminary decree attaining finality because of non‑filing of appeal‑‑Conditional order for leave to defend suit, whereb3‑ defendants were to have deposited specified amount, on non‑fulfilment of such condition had merged against preliminary decree and thus attained finality‑‑Final decree passed subsequently had been challenged only because of challenge to said conditional order and preliminary decree resulting for failure to fulfill condition attached with leave to defend suit, and not challenged on any other ground‑‑Such preliminary decree and conditional order to defend suit had been validly made and as a consequence final decree was rightly and validly passed. Khalid Farooq Qureshi for Appellants. Shahid Hamid for Respondent No.1 Date of hearing: 19th March, 1988. MUHAMMAD ASADULLAH, J.‑‑A suit for recovery of Rs.5,57,846.86 was filed by respondent No.1 against the appellants on account of overdraft facilities and loan facilities obtained by the appellants. Apart from the personal guarantees the loan was secured through mortgage of property. The appellants filed an application for leave to defend the case, which was allowed by the learned trial Court vide. order dated 17‑2‑1983 subject to the condition that the appellants deposit whole of the amount in suit up to 15‑9‑1983. On the request of the appellants the time for deposit was extended up to 15‑10‑1983. No deposit within the time allowed by the learned trial Court was made by the appellants. Instead Writ Petition No.3855 of 1983 was filed by the appellants to challenge the said order dated 17‑2‑1983. However, the same was dismissed vide order dated 11‑10‑1983 of this Court. The appellants then filed Intra‑Court Appeal No.218 of 1983 which was apart from other dates, taken up on 15‑10‑1983 when the case was adjourned on the request of the learned counsel for the appellants as he wanted to discuss with his clients as to whether they were prepared to pay the amount and if so, how and within what period. The ICA was adjourned to 18‑10‑1983. In the meantime the suit was taken up by the learned trial Court on 15‑10‑1983, the date already fixed. Because of non‑deposit of the amount in suits, as required by order dated 17‑2‑1983, a preliminary decree for the amount in suit (dated 15‑10‑1983) was passed by the learned trial Court alongwith interest and costs. Thereafter, the ICA was taken up on 18‑10‑1983 and the learned counsel for the appellants stated that the appellants were ready and willing to deposit in Court the amount in dispute but they may be allowed three months time to sell a plot of land, owned by them, for the purpose. In view of this statement a part of impugned order dated 17‑2‑1983 regarding the making of the deposit was suspended. However, it was ordered that the proceedings before the trial Court are not stayed and the same shall continue meanwhile. It may be pointed out here that the fact of the passing of preliminary decree on 15‑10‑1983 was not brought to the notice of the learned Division Bench when they passed the said order dated 18‑10‑1983. The ICA was then adjourned to 21‑11‑1983. When the same was taken up on the said date it was adjourned to 16‑1‑1984 on which date the suit before the Special Judge (Banking) was fixed. It was then taken up on 29‑9‑1984. In the meantime a final decree against the appellants and in favour of respondent No.1 had been passed by the learned trial Court on 1‑4‑1984. Thereafter, the ICA was dismissed in default but then restored on the application of the appellants. Finally on 11‑1‑1987 the learned counsel for the appellants stated that the ICA had become infructuous and the same was dismissed accordingly. After the passage of the preliminary decree (on 15‑10‑1983) the appellants filed an application on 26‑10‑1983 under Order XXXVII, Rule 4, C.P.C. reads with Order IX and section 151, C.P.C. praying that in the circumstances of the case the preliminary decree passed on 15‑10‑1983 may be recalled and the defendants may be allowed to defend the suit on merits. The said application was dismissed by the learned trial Court vide order dated 31‑3‑1984. Thereafter, the final decree was passed on 1‑4‑1984. This appeal has been filed against the said final decree dated 1‑4‑1984 in which the said orders dated 17‑2‑1983 and 31‑3‑1984 have also been challenged. We have perused the record and have heard the arguments.

2. No appeal against the preliminary decree passed on 15‑10‑1983 was filed. Therefore, the main question which arises in this appeal is as to whether the preliminary decree passed on 15‑10‑1983 can be called into question in this appeal. According to the learned counsel for the appellants he could challenge the preliminary decree only after a final decree had been passed. He contends that no appeal against a preliminary decree lies. On the other hand the contention of the learned counsel for respondent No.l is that a preliminary decree is as much appealable as is the case for a final decree. He argues that when no appeal against the preliminary decree was filed the appellants cannot now challenge the preliminary decree dated 15‑10‑1983. No case law directly dealing with the provisions of law contained in the Banking Companies (Recovery of Loans) Ordinance, 1979 (XIX of 1979) is available on this point. However, the provisions of law contained therein are quite clear. The work "decree" is no defined in section 2 (ibid). Section 3 thereof provides that: "The provisions of this Ordinance shall be in addition to and, save as hereinafter expressly provided, not in derogation of any other law for the time being in force." As no separate definition of decree has been given in the said Ordinance we have to fall back upon the General Law for finding the definition thereof because section 3 (ibid) provides that the provisions contained in the Ordinance are not in derogation of any other law. In the circumstances the definition of the decree contained in the Code of Civil Procedure, 1908, will have the same meaning in its application to the said Ordinance. The word "decree" is defined in clause (2) of section 2 of the Code of Civil Procedure and clearly A provides that a decree may be either preliminary or final. The explanation given under the said clause (2) runs as follows:‑ "A decree is preliminary when further proceedings have to be taken before the suit can be completely disposed of. It is final when such adjudication completely disposes of the suit. It may be partly preliminary and partly final." It will be seen from the explanation that a decree is preliminary when some further proceedings have to be taken before the suit can completely be disposed of. This particularly was the situation when the preliminary decree was passed on 15‑10‑1983. Therefore, the definition given in clause (2) of section 2 of the C.P.C. is applicable to the provisions of law contained in the said Ordinance of 1979. Accordingly a preliminary decree can be passed and is appealable in the same manner as is the case of final decree under the said Ordinance.

3. Section 8 of Ordinance XIX of 1979 provides that after the case has been heard the Special Court shall pronounce judgment and on such judgment a decree shall follow forthwith. The said section does not speak of a preliminary decree or a final decree. It does not speak of the same because it admits of both kinds of decrees, preliminary and final. If a distinction were required to be made it would have been made clear in the said section that after the judgment a final decree shall follow. Similarly, the said section would have made it clear that no preliminary decree could be passed under the said Ordinance or that no preliminary decree was required to be passed in cases tried under the said Ordinance. No distinction in respect of a preliminary or a final decree was made because under section 3 of the Ordinance the definitions contained in the Code of Civil Procedure, subject to the exception contained therein, would apply mutatis mutandis in the cases covered by the said Ordinance. A decree to be a decree within the meaning of section 8 of the Ordinance has to contain interest etc. as provided in subsection (2) thereof. The preliminary decree dated 15‑10‑1983 passed in this case specifically contained an order relating to the payment of interest. Therefore, the preliminary decree was a decree within the meanins3 of section 8 of Ordinance XIX of 1979.

4. Section 12 of the said Ordinance deals with appeals and' specifically provides that an appeal against a decree lies and can be filed within the specified time. The word "decree" contained therein has the same meaning as understood .in section 8 (ibid). Therefore. even in section 12 the word "decree" means to include not only a final decree but also a preliminary decree especially for the reasons given in the foregoing paragraph. In the proviso to subsection (1) of section 12 (ibid) an exception has been made that no appeal will. lie from an interlocutory order which does not dispose of the entire case. There is no such exception in respect of a preliminary decree. If the framer of the law has meant to exclude the preliminary decree from the purview of appeal it would have excluded the same specifically as is the case in respect of an interlocutory order. In any case if only a final decree were to be made appealable then instead of using the word 'decree' the words 'final decree' would have been used in C subsection (1) of section 12 (ibid). This clearly shows that section 12 of the Ordinance admits of appeals against "preliminary decree" as also against a "final decree". Therefore, the preliminary decree passed on 15‑10‑1983 in this case was appealable under section 12 (ibid).

5. As stated above no appeal was filed against the preliminary decree, and therefore, the same had attained finality and could not be challenged in the present appeal. Similarly, the order dated 17‑2‑1983 through which conditional permission to defend the case. was granted has attained finality because the same stood merged in l the preliminary decree. Therefore, the order dated 17‑2‑1983 cannot be subject of attack in this appeal.

6. So far as the order dated 17‑2‑1983 is concerned it attained! finality in another manner as well. As narrated above W.P. No.3855 of 1983 was filed to challenge the said order dated 17‑2‑1983. However, the same was dismissed on 11‑10‑1983. ICA No.218 of 1983 filed against D the said order dated 11‑10‑1983 was dismissed as infructuous vide order dated 11‑1‑1987. In this way the order dated 17‑2‑1983 not only stood in the field but also stood confirmed by this Court in the proceedings of the said writ petition and the I.C.A. The learned counsel for the appellants has contended that the learned Division Bench had issued an order dated 18‑10‑1983 through which the deposit of the amount in dispute, as required under order dated 17‑2‑1983, was stayed and that in view of the said order of suspension of payment no final decree could be passed. We .wish the learned counsel for the appellants should not have raised this plea because the said order was passed due to the concealment of hard and known fact that a preliminary decree had already been passed on 15‑10‑1983. If the fact of passage of the said preliminary decree had been brought to the notice of the learned Division Bench on 18‑10‑1983 the order of suspension of payment could never be made. In any case the order dated 17‑2‑1983 had merged into preliminary decree passed o_ 15‑10‑1983 and the question of suspension of payment thereunder could not arise subsequently on 18‑10‑1983. Again the said ICA, a already pointed out was dismissed as infructuous on 11‑1‑1987 and as such all the interim orders passed therein stood automatically vacated it may also be pointed out that if the appellants wanted to make us of the said stay order they could have made a prayer during the proceedings in the ICA that the operation of the preliminary decree or the recovery of the decretal amount thereunder may be stayed. The appellants did not do so and could not have the courage of doing so because they had concealed the passage of the preliminary decree from the learned Division Bench in the proceedings taken on 18‑10‑1983. Therefore, the order dated 18‑10‑1983 could not be of any use or help to the appellants and they cannot say that in view of the same no final decree could be passed. Again, it may also be added that in the said order dated 18‑10‑1983 it was specifically provided that the proceedings in the case should continue before the learned Special Judge (Banking). Therefore, he could go on with the case and could legally pass the final decree.

7. On 26‑10‑1983, after the passage of preliminary decree, the appellants made an application under Order XXXVII, Rule 4, C.P.C. read with Order IX and section 151, C.P.C. praying that the preliminary decree dated 15‑10‑1983 and for that matter the order dated 17‑2‑1983 may be recalled and they may be allowed to defend the case without the condition of deposit of the amount in dispute. This application was dismissed on 31‑3‑1984. This of course was an interlocutory order and was not appealable. As such the same could be challenged in this appeal. Rule 4 of Order XXXVII, C.P.C. admits of such an application but only in some special circumstances. No such special circumstances existed in favour of the appellants so as to entitle them to seek the recalling of the preliminary decree or the order dated 17‑2‑1983. A perusal of order dated 17‑2‑1983 will show that they were allowed to make the deposit up to 15‑9‑1983 i.e. within a long period of about 7 months. It was made clear in the said order that long date was being "granted at the request of the defendants to enable them to deposit the said amount." This would show that the appellants were willing to make the deposit but they wanted to have a longer period for doing so. Therefore, they could! not thereafter file the said application to seek avoidance of the said condition of deposit, moreso because they had even beyond the said date of 15‑9‑1983 sought an extension for making the deposit and they were allowed the extension up to 15‑10‑1983. Similarly, in the! proceedings of the said ICA the appellants did not wish to avoid the deposit altogether. They requested for time of 3 months for raising funds for the deposit by disposal of a plot owned by them. This would mean that the appellants were always ready and willing to make the deposit and they were seeking a longer time for doing so. In other words the appellants had no circumstances what to say of special circumstances in their favour on the basis of which they could avoid the making of the deposit. Again in view of their concealment of the fact of the passage of preliminary decree on (15‑10‑1983) from the learned Division Bench (in the ICA) on 18‑10‑1983 they could not make the application under Order XXXVI, Rule 4, C.P.C. before the learned trial Court. Further, the availing of the loan facility and the execution of the documents in connection the rewith were not denied by the appellants and were in fact admitted. Their plea was that they had suffered damage because the full loan facility was not provided by respondent No.1 to them. We need not comment on this aspect of the case because it is admitted that a suit for recovery of Rs.25,00,000 as damages on this ground has been filed by the appellants and is pending before a learned Judge of this Court. In any case so far as the obtaining of the loan and the execution of the documents in connection with the same are concerned these were admitted and the learned trial Court had no option but to order for the deposit of the amount in dispute as a condition precedent for the permission to defend the suit allowed in order dated 17‑2‑1983. The order dated 31‑3‑1984 therefore, was rightly and validly made.

8. The final decree is based on the preliminary decree which attained finality because of non‑filing of the appeal. Similarly, the order dated 17‑2‑1983 attained finality as it stood merged in the said preliminary decree. The final decree passed on 1‑4‑1984 is challenged only because of the challenge to the said order dated 17‑2‑1983, the H preliminary decree dated 15‑10‑1983 and the order dated 31‑3‑1984. The final decree is not challenged on any other ground. The said preliminary decree and the orders have been held to be validly made and as a consequence the final decree was rightly and validly made.

9. In view of our discussion above the appeal is dismissed with costs. A.A./Y‑9/L Appeal dismissed.