2005 PLP 1481 (CLD)

MIAN HAMID FAROOQ, J.

Present first appeal proceeds against judgment dated 21-11-2000, whereby the learned Judge Banking Court, dismissed appellant's suit on the ground of its non-maintainability.

2. Precisely stated the facts of the case are that the appellant filed the suit for declaration, permanent and mandatory injunction together with damages, before the learned Judge Banking Court, who issued summons to the respondent-Bank. The respondents Nos. 1 to 3 filed the written statement and a preliminary issue, qua the maintainability of the suit, was framed. The learned Judge Banking Court, only, after hearing the parties, proceeded to dismiss appellant's suit being not maintainable, vide impugned judgment dated 21-11-2000, hence the present appeal.

3. Despite service, none has entered appearance to represent the respondents Nos. 1 to 3, hence they are proceeded ex parte.

4. Learned counsel for the appellant has contended that although the respondent-Bank did not file any application for leave to defend the suit, yet their written statement was entertained and appellant's suit was dismissed. He has further submitted that the appellant has been condemned unheard; no public auction was held and the alleged auction was not in conformity with law.

5. We have examined the summoned record and find that on the presentation of the plaint by the appellant, the learned Banking Court issued summons to the respondents Nos. 1 to 3, as provided under section 9(3) of the Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997 (hereinafter referred to as Act). Pursuant to the said summons, the respondents appeared in the Court, but instead of filing the application for leave to defend the suit, initially, requested the Court for filing the written statement and ultimately submitted the written statement on 4-12-1999. On the same day, the learned Banking Court framed solitary issue, viz as to whether the suit in its present form, is maintainable or not. Admittedly the respondents did not file any leave application and they were not granted leave to defend the suit, yet they filed the written statement, which under the law could only be filed when a defendant is granted leave to defend the suit. Section 9(4) of the Act envisages that the defendant shall not be entitled to defend the suit, unless he obtains leave from the Banking Court to defend the suit and in default of his doing so, the allegations of fact in the plaint shall be deemed to be admitted and the learned Banking Court may pass a decree in favour of the plaintiff. Section 10 of the Act provides that the learned Banking Court shall, upon an application made by the defendant within 21 days, give leave to defend the suit, if a serious and bona fide dispute is raised thereby. Section 13 of the Act provides that the suit, in which leave to defend has been granted to the defendant, shall be disposed of within 90 days from the date on which the leave was granted. It is evident from the joint reading of the aforesaid provisions of law that after the service of a defendant has been affected, as provided under section 9(3) of the Act, 1997, he shall not be entitled to defend the suit, unless he obtains leave from the Court to defend the suit. It flows therefrom' that when a defendant is served, he is only required to file an application for leave to defend the suit and he is not permitted to submit the written statement as a right. It has nowhere been provided in the special statute that the defendant, after the service, is required to straightaway file the written statement. It is only in the eventuality that the leave is granted to the defendant that he is entitled to file written statement. In the present case, admittedly after the service of the respondents Nos.1 to 3, they did not file any application seeking leave to defend the suit and they, after obtaining certain adjournments, filed the written statement, which was erroneously entertained by the learned Banking Court in complete oblivion of the provisions of the Act. In the present set of circumstances, when the respondents failed to file the application for the grant of leave to defend the suit, the learned Banking Court, instead of receiving the written statement from the respondent, ought to have called upon the appellant to prove his case by producing evidence, as in the suit for declaration and permanent injunction, a decree could not have been passed straightaway, as the claim for declaration cannot be equated with the suit founded on a negotiable instrument. When the respondents failed to obtain the leave to defend the suit, the learned Banking Court was legally obliged to decide the suit after calling upon the appellant to produce evidence in support of his claim. The learned Banking Court has completely deviated from the procedure, provided under the special statute, completely forgetting that the Banking Court, being the creature of the statute, is bound by the provisions of that statute. The learned Banking Court could not have entertained the written statement from the respondents without obtaining leave to defend the suit.

6. There is another aspect of the case. Although the learned Banking Court framed the issue regarding the maintainability of the suit, yet no opportunity was granted to the parties to adduce evidence far or against the issue. Additionally, the learned Banking Court did not treat the said issue as legal/preliminary issues, as required under Order XIV, rule 2, C.P.C. We feel that even the issue of maintainability of the suit could not have been decided without calling upon the appellant to produce his evidence.

7. In the above perspective, we have examined the impugned judgment and find that it suffers from serious legal defects, thus the same cannot be maintained. We are inclined to set it aside.

8. Upshot of the above discussion is that the present appeal is allowed and the impugned judgment dated 21-11-2000 is set aside with no order as to costs. Resultantly appellant's suit titled "Abdul Sattar Rana v. National Bank of Pakistan and 2 others" shall be deemed to be pending before the learned Judge Banking Court, Gujranwala, who shall decide the same, afresh, after calling upon the appellant/plaintiff E to produce evidence in support of his claim and, also providing adequate opportunity to the respondents Nos. 1 to 3 to cross-examine plaintiffs witnesses and to raise objections regarding admissibility and authenticity of the documents, if produced by the plaintiff. Needless to add that respondents Nos.1 to 3 shall not be allowed to lead their evidence or to produce any documents as they failed, to obtain leave to defend the suit. S.A.K./A-425/L Appeal accepted.