1989 PLP 2204 (CLC)

TANZIL‑UR‑REHMAN, J:‑‑This is a High Court Appeal preferred by State Bank of Pakistan against the order dated 7‑4‑1983 passed by a learned Single Judge of this Court in CMA No.522 of 1969 allowing the said application and directing the appellant to give further adjustment of Rs.1,18,234.55 to the Official Liquidator in respect of securities held by them on behalf ‑of Messrs National Commercial Bank Ltd., in liquidation. The facts giving rise to this appeal, briefly stated, are that the National Commercial Bank Ltd. Karachi went into liquidation on 13th March, 1968. The appellant appointed one Akhtar Hussain, its own employee, as Liquidator of the said Bank who on 19th June, 1968 issued notice under Section 55 of the Banking Companies Ordinance, 1962 to the secured creditors including the State Bank of Pakistan, the appellant, for valuation of the assets of the said Bank. In response to the said notice, the appellant through its letter dated July, 1968 gave its own valuation in respect of the assets of the said Bank, to be in the sum of Rs.56,94,100.55 against the claim of the appellant in the sum of Rs.53,19,

000. Later on, on an application (CMA No. 522 of 1969) the Official Liquidator was directed by an order dated 26th May, 1969 of a learned single Judge of this Court to negotiate with the State Bank of Pakistan for the redemption of the securities and the payment of the debts referred to in the said application. The Official Liquidator sold the said securities to the State Bank of Pakistan on 17‑7‑1968 for a sum of Rs.55,75,907 only, as against the valuation of Rs.56,94,100.55 fixed by State Bank of Pakistan. The respondent, namely, Karachi Port, and Docks Workers' Welfare Fund, Karachi, who had already put in their appearance in response to a public notice published in Press, took an objection, inter alia, that it was unfair to the depositors for the Official Liquidator to dispose of Government securities of the value of Rs.56,76,141.55 held in pledge/purchased by the appellant for only Rs.55,75,

907. Thus it was prayed by the respondents that the appellant be called upon to pay Rs.56,94,141.55 as value of the said securities and the transaction in respect of the same between the Official Liquidator and the appellant for Rs.55,75,907‑be cancelled. This request of the respondent was substantially allowed inasmuch as the appellant was directed to adjust the amount of Rs.1,18,234.55 in the loan account of the bank in liquidation by order dated 7‑4‑1983 passed by a learned single Judge, impugned in the above appeal. Mr. Abdul Majeed Khan, learned counsel for the appellant submits that as provided under Section 55 of the Ordinance, 1962 the valuation price and the actual price sale/purchase price of the securities may vary and, therefore, no exception can be taken if the appellant Bank has purchased securities for a sum of Rs.55,75,907 only. The submission as regards the variation between the amount of Rs.55,75,907 only. The submission as regards the variation between the amount of valuation and the amount of actual proceeds, as a principle, may carry some weight, but in the facts and circumstances of the case before us when the appellant itself communicates valuation of the securities by letter dated 3rd July 1968 and just after about two weeks it purchases the same securities through Official Liquidator for a lesser amount without putting on record that the price of the securities had gone down in the market seems really objectionable. According to the admission of the appellant itself there was no sale or purchase of such securities during the period. The Stock Exchange Report itself shows that the price of the said securities on 22nd July, 1968 was the same as the amount of valuation shown by the appellant and communicated to the Official Liquidator. Moreover, this fact should not go unnoticed that the position of the appellant, in this case, was that of an interested party inasmuch as it held the securities of the bank in liquidation and there existed a fiduciary relationship ‑between the State Bank of Pakistan, the appellant and the bank in liquidation. It is also noticeable that the Official Liquidator himself informed the Court by making application No.522/1969 about the valuation communicated by the appellant to him and it was on the basis of that valuation mentioned in the said application that a learned single Judge authorised the Official Liquidator to negotiate with the appellant for redemption of the said securities. The manifest purpose was to make the State Bank of Pakistan agreeable to a better price, otherwise, the order might have been confirming the said valuation and transferring the assets to the appellant. There is no material on record to indicate the circumstance as to any sale/purchase price of the securities had gone down in the market, because there was no actual sale or purchase of the said securities nor any fresh valuation sought for. It is also noticeable that there is no communication from the appellant before actual purchase of the securities that the price of the said securities had gone down and, if so, on what basis. In these circumstances, the order passed by the learned single Judge is just and proper and calls for no interference and the appeal is dismissed. There will, however, be no order as to costs. AA./S‑445/K Appeal dismissed.