2003 PLP 1426 (CLD)

MUHAMMAD SAYEED AKHTAR, J.

The, appellants assail the order of the learned Banking Court dated 4-6-2001 by which the objection petition of the appellants was dismissed. The respondent-Bank filed a suit for recovery of Rs.1,42,92,515.80 alongwith liquidated damages to the tune of Rs.28,585,03.16. The suit was decreed on 19-6-1996 to the extent of Rs.1,42,92,515.80 alongwith costs. However, the liquidated damages were disallowed. Another Suit No.34 of 1995 filed by the respondent-Bank was decreed for an amount of Rs.9,981,377 with costs. The parties reached a compromise on 2-4-1998. The relevant terms of the compromise/ agreement are as under:--

1. In consideration of the aforementioned compromise arrived at between the parties, the defendants admit financial liabilities and have agreed to pay Rs.20,000,000 (Rupees two crore only) in the manner, as detailed below:-- (a) Rs.500,000 to be paid by the defendants on or before 6-4-1998 as down payment (b) The factory land, building, machinery etc, of defendant No. 1, mortgaged with the plaintiff-Bank as one of the securities, will be sold by the defendants on a price which is not less than Rs.12.500 (m) approved by the plaintiff-Bank within maximum period of 18 months. (c) The sale proceeds to the extent of Rs.12.500 (m) from the factory land, building, machinery etc. of defendant No. 1 shall be deposited with the plaintiff Bank for adjustment of agreed outstanding financial liabilities and plaintiff-Bank shall issue necessary NOC regarding property of defendant No. 1 i.e. Property bearing Nos.223-224-225/S, situated in Industrial Area, Kot Lakhpat, Lahore alongwith machinery, furniture, fixtures etc. thereof. (d) Balance amount, if any, shall be paid by the defendants through monthly instalments of Rs.0.200 (m) each. (e) The securities/ guarantees already furnished by the defendants shall remain intact.

2. In case the defendants fail to pay the agreed amount of Rs.20,000,000 in terms of this compromise, the Suit No.34 of 1995 shall be deemed to have been decreed for total suit amount as prayed for and the plaintiff-Bank shall be entitled to execute 'the decree to be passed in Suit No.34 of 1995 and the decree already passed in Suit No.131 of 1995, amongst other modes, by sale of the properties mortgaged by the defendants with the plaintiff-Bank and other movable/ immovable assets/ properties of the defendants under the provisions of Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997.

3. Upon final adjustment of the agreed amount of Rs.20,000,000, the plaintiff-Bank shall release the personal properties of defendants Nos. 2 and 3 and shall issue a No-Claim Certificate accordingly. The appellants could not allegedly make the repayments as per schedule and the Bank filed execution application on 27-10-1999. The appellants filed an objection petition which was dismissed by the learned Banking Court on 4-6-2001.

2. Learned counsel .for the appellants submitted that the appellants did not commit any default as per terms of the compromise agreement. In the absence of any breach on the part of the appellants the execution application was not proceedable. In fact the respondent-Bank did not fulfil its part of compromise agreement. Conversely the learned counsel for the respondent submitted that the appellants could not keep the repayment schedule agreed between the parties as such the execution application was maintainable and the objection petition has been rightly dismissed by the learned Banking Judge.

3. We have gone through the order of the Banking Court and perused the record. We find that there is no finding of the learned Banking Judge in respect of default/breach committed by the appellants. In this view of the matter we have no option but to allow this appeal and remit the case to the learned Banking Court with a direction to decide whether the appellants committed default in the repayment of instalments as per agreed schedule. Resultantly the objection petition of the appellants shall be deemed to be pending. No order as to costs. Appeal allowed. S.A.K./S-607/L Case remanded.