1985 PLP 987 (SCMR)

NASIM HASAN SHAH, J.‑‑This petition for leave to appeal is directed against the judgment of the Lahore High Court dated 7‑12‑1980 passed in I.C.A. No. 439 of 1980. The relevant facts are that respondent No.l (United Bank Ltd.), in banking company, instituted a suit for recovery of Rs.96,30,854.77 against the petitioner. In the plaint, it was averred by respondent No.1 that petitioner No.l on all the material times maintained a loan against Packing Credit (L.A.P.C.) account with its Dyal Singh Mansion Branch, Lahore and in that account it had extended /granted advances/ loans facilities to petitioner No.l. It was further averred in the plaint that as on 31‑3‑1979, a sum of Rs.82,61,330.64 was outstanding in the said L.A.P.C. account which had been confirmed and agreed in writing by petitioner No.l vide Debit Balance confirmation letter dated 31‑3‑1979 and that on that date two promissory notes, letter of agreement and letter of hypothecation of goods had also been executed. Certain amounts to were also stated to have been advanced in LIM Accounts Nos. 55/78,‑‑46/78 and 75/78 against which as on 31‑3‑1978 a sum of Rs.7,11,287.79 was also outstanding. It was further stated that petitioners Nos. 2 to 4, 7, 8, 10 and late Muhammad Jamil had executed the letters of guarantee, whereby they had guaranteed due repayment of the loan. Some of the petitioners, with intent to create an equitable mortgage upon their properties for securing loan had also deposited title deeds with respondent No.l. The said suit was filed under the provisions of Banking Companies (Recovery of Loans) Ordinance, 1979. The petitioners as defendants in the said suit filed an application under Order XXXVII, rule 3, C.P.C. praying for grant of leave to appear and defend the suit. In this application, many legal objections questioning the competence of the suit itself were raised. It was asserted that many documents on which reliance was placed by the plaintiff; respondents were secured in blank and unfilled forms and under undue and coercive influence. In fact only 6 lacs were due and that in fact the claim of the plaintiff /respondent secured well over one crore rupees in terms of equitable mortgage of immovable properties. It was also alleged that in order to coerce and intimidate petitioner No.2, his signatures were procured on blank documents and that the documents upon which the suit had been based were fictitious having been obtained by undue influence and having been filled up later by the officer of respondent No.l. The learned Sub‑Judge by his "'order dated 14‑1‑1980 allowed the petitioners to appear and defend the suit subject to the condition that they deposit the entire amount of Rs.96,30,854.77 within two months from the date of order. Against this conditional leave to defend the suit the petitioners approached the Lahore High Court by filing an appeal (F.A.0. No. 64 of 1980) which was later converted into Writ Petition No. 2203/80. A learned Single Judge of the High Court who by his order dated heard the writ petition 24‑6‑1980 dismissed it. Aggrieved by that Order I.C.A. No. 439 of 1980 was instituted which was also dismissed by a Division Bench by, its order dated 7‑12‑1980. Hence this petition for leave to appeal. Mr. Raza Kazim, in support of this petition has submitted that the condition imposed on the petitioners while granting leave to defend the suit namely that they should deposit the total amount of the claim in cash with the Court was unjustified. The petitioners had mortgaged the properties with the plaintiff Bank whose value was over a crore of rupees. In fact, according to clause 6 of the prayer clause of the suit itself an order was sought directing payment from the defendants only in the event and to the extent that "the said properties under hypothecation/pledge/mortgage, if sold and in case sale proceeds were found to be insufficient be paid by the defendants 1‑‑10 jointly and severally. In these circumstances the order directing the deposit of the amount claimed in cash as condition for leave to defend was misconceived. This point was also urged before the High Court and has been discussed in detail by the learned Single Judge and negative. We agree with the reasoning of the learned Judge that in so far as respondent No.l does not admit that the amount stands sufficient. secured under the equitable mortgages and the order for cash deposit which was one of the orders that could be passed in the discretion of the trial Court, the same could not be interfered with in the course of writ jurisdiction. The further contention raised before us was that the loan amount held to be payable by the petitioners was made up mainly of various amounts of interest. However, the word "Loan" as defined in clause (d) of section 2 of the Banking Companies (Recovery of Loans) Ordinance, 1979 did not include interest but was confined solely to the principal amount. This point does not appear to have been taken before the Courts below and we are, therefore, reluctant to allow this question to be l raised before us for the first time. We may, however, observe that in the documents produced by the Bank the amount of Rs.96,30,854.77 is admitted to be the loan amount. However, leave to appear to defend the suit has been granted where this point may be contested if so advisable but prima facie the amount required to be deposited is in accordance with the amount admitted in the documents signed by the petitioner to be in fact due. We also observe that the definition of the word "loan" in clause (d) of section 2 of the Banking Companies (Recovery of Loans) Ordinance, 1979, states that the "loan" includes: (i) an advance, cash credit, overdraft, packing credit, a bill discounted and purchased or any other financial accommodation provided by a banking company to a borrower; (ii) ............... (iii)............... (iv)............... (v)............... The definition of loan, therefore, is not exhaustive. However, we are not inclined to give any considered opinion on this point at this stage. Suffice it to say, that the order of the Special Judge (Banking) calling for cash deposit in terms of the amount prima facie admitted to be due, is not against any law or principle of law and, therefore, no interference with such an order is called for at this stage. This petition is accordingly dismissed. M. I. Leave refused.