2007 PLP 1639 (CLD)

NADEEM AZHAR SIDDIQI, J.

By filing of the instant application (C.M.A. No.4097 of 2007) the plaintiff has prayed that the interim consent decree dated 17-4-2006 may be confirmed as final decree along with cost of fund from the date of default till realization of the decretal amount. No counter-affidavit to this application has been filed on behalf of the defendant. The facts of the case .are that on 21-4-2003 the parties were entered into "Finance Agreement" on- mark-up basis .and Export Refinance Facility for upto Rs.150 million -was extended to the defendant, which was fully utilized. It was further stated in the plaint that other than finance mentioned above, which was supposed to expire on 6-8-2005, at the request of the defendant, the plaintiff also approved through its letter .dated 28-9-2004 a renewal of financing. Upto Rs.150 million w.e.f. 1-1-2004 with an expiry by 31-12-2004, but without adjusting liability on 31-12-2004, the defendant requested the plaintiff-Bank vide its letter dated 18-1-2005 for" renewal of the same and on 27-1-2005 the plaintiff-Bank accepted the offer of the defendant and the limit was renewed upto 31-7-2005 for Rs. 128 million. The plaintiff claims an amount of Rs:90,398,342 as on 15-11-2005 from the defendant along with cost of fund, service charges and all other charges from slie date of default and realization of the same. The defendant filed application for leave to defend. The defendant has not disputed the Finance Agreement and the amount. The defendant, however, disputed the amount of Rs.90, 398, 342 claimed by the plaintiff and admitted an amount of Rs.88,316,

000. On 17-4-2006 an interim decree was passed in the sum of Rs.88,316,

000. While passing the interim decree the following issue was framed:-- "Whether the plaintiff is entitled to cost of funds, service charges and .all other charges from the date of default till realization of the sane? If so, to what extent." With the above background the listed application was filed. The learned counsel for the plaintiff submits that the defendant has committed default by not adjusting the total liability by 31-7-2005. He referred to section 3 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 (hereinafter referred to as the Ordinance) and submits that in case of default in discharge of obligations the defendant is liable to pay from the date of default till realization the amount due along with the cost of funds as certified by the State Bank of Pakistan. He further submits that even after the interim decree the defendant has not discharged his obligation and, as such, the plaintiff is entitled to cost of funds. The learned counsel for the defendant submits that unless the judgment is passed the plaintiff cannot claim the cost of fund. He further submits that for Maiming cost of fund adjudication of the case on merits, is necessary and the plaintiff cannot claim default at his whims. He referred to subsection (3) of section 3 of the Ordinance and submits that no determination of default has been made in this case. He further submits that in the letter dated 10-4-2007 on the basis of which, the listed application has been filed no cost of funds has been claimed by the Bank. The learned counsel relied upon the reported .case of Prince Glass Works Limited v, Commissioner Sindh" Employees Social Securities Institution 1987 PLC

541. I have heard the learned counsel for the parties and perused the record. The interim decree was passed in the sum of Rs.88,316,000 on the basis of claim admitted by defendant in para.24 of the application for leave to defend. While passing interim decree the issue with regard to payment of cost of fund has been framed. The plaintiff instead of producing evidence filed the listed application. The learned counsel for the defendant has contended that the date of default has not been determined in this case. The plaintiff in para.13 of the plaint claimed default from 31-7-2005. The defendant in para. 13 of application for leave to defend states that "para. 13 of the plaint is admitted". It appears that defendant has not disputed the date of default. Furthermore, the interim decree was passed on 17-4-2006 but the same. was not complied with. When the date of default snot disputed formal determination is not necessary and the admitted date of default can be taken as date of default. .However, inspite of framing of issue the plaintiff does not want to proceed on merits and filed the instant application. In this case interim decree was passed on 17-4-2006 which .was not complied with and the same may be' taken as the admitted date of default. The learned counsel for the plaintiff has placed on record the letter of State Bank of Pakistan dated June 5, 20.06, showing the cost of funds of 6.44%. In view of above the suit of the plaintiff is decreed as prayed against the defendant in the sum of Rs.88,316,000 along with cost of fund of 6.44% from the date of interim decree till realization of the decretal amount subject to adjustment of any amount paid after interim decree. The defendant will also bear the cost of the proceedings, Office to prepare the decree. M.H./K-24/K????????????????????????????????????????????????????????????????????????????????????? Suit decreed.