2004 PLP 886 (CLD)

Azmat Saeed and Asim Hafeez for Appellants. Shakeel Ahmed Awan for Respondents. Date of hearing: 22nd September, 2003. MIAN SAQIB NISAR, J.‑On 16‑3‑2001, respondents brought a suit against the appellant before the Modaraba Tribunal, for the recovery of Rs.39,20,

500. In suit, the appellant moved an application for leave to appear and defend which application has been rejected, however, the suit has been decreed vide judgment and decree dated 21‑6‑200, not to the tune of the amount claimed, rather for Rs.3,18,3,750

2. Learned counsel for the appellant contends that the Musharaka agreement dated 5‑3‑1998 is an admitted document/ contract, between the parties and according to the same, the sale price of the commodity sold thereunder is Rs.98,00.000 and the re‑purchase price, which the appellant was obliged to pay to the respondent/Modaraba was Rs.99,93,315; the Musharaka agreement was for a period of one month, expiring on 5‑4‑1998. Moreover, the appellant entered into another separate agreement in which the appellant admittedly had deposited an amount of Rs.85,00.000 and it was agreed between parties that this amount shall remain under lien till the amount received under the earlier Musharaka agreement, was returned by the appellant. Subsequently, the respondent/plaintiff brought the aforesaid suit arid in paragraph No.6 of the plaint, it admitted the execution of the agreement; the amount of finance; period of finance and the amount payable thereunder. However, in paragraph No.10, of the plaint, the respondent has unauthorizedly claimed the outstanding amount of Rs.6,627,365 as profit @ 24% from 12‑3‑1998 to 20‑1‑2001, this is not due to the respondent because of the reason that Musharaka agreement had come to an end on 5‑4‑1998 and thereafter, under the agreement, no profit/interest could have been charged. It is also submitted that under the Musharaka which the appellant had provided to the respondent, admittedly an amount of Rs.85,00,000 was deposited by the appellant and was under lien of respondent therefore, from the date of adjustment of this amount i.e. when the Musharaka agreement expired on 5‑4‑1998, according to the respondent, after having admitted the Musharaka provided by the appellant to the respondent and profit payable thereupon which amount comes to Rs.13,325,206, and interest excluding the profit of Rs.6,627,365, charged from the appellant, in fact it is the appellant, who is entitled to the refund of certain amount.

3. Learned counsel for the respondent when confronted with the above, has relied upon clause 19 of the agreement, which clearly stipulates that though the Musharaka is for a period of one month, but it shall be automatically extended/renewed on quarterly basis till such time, it is terminated or annulled as per the terms of the agreement. Moreover, the amount to which the respondent is entitled for the extended period, parties have expressly agreed in clause 7, the rate of profit. This is exactly what the respondent has charged from the appellant.

4. We have heard learned counsel for the parties. Undoubtedly, the agreement was initially for a period of one month, but as per the terms of the agreement to which they out of their free consent, the agreement remained alive on quarterly basis until the time it was rescinded or annulled. Therefore, under clause 7, the rate of profit or addition to the repurchase sale price in terms of percentage for the extended period, was also agreed between the parties, thus after having adjusting the Musharaka provided by the appellant as security as also the profit occurred on that amount, the respondent has correctly claimed that amount which was decreed by the Tribunal. However, learned counsel for the respondent has conceded that respondent was not entitled to the charge of mark‑up to the extent of. Rs.81,000, the amount charged as mark‑up after 25‑1‑2001, when the adjustment took place, therefore, the decree of the Modaraba Tribunal to that extent stands modified. n the light of above, this appeal is dismissed. M.I./G‑318/L Appeal dismissed.