2000 PLP 1425 (CLC)

(iv) The Court is not competent to order sale of the mortgaged property situated beyond its territorial jurisdiction in respect of his property which is situated in Islamabad. He referred to section 39, C.P.C. AIR 1947 Mad. 347 and AIR 1939 Pat. 532 in support of his argument. C.M.A. No.2232 of 1999

4. Mr. Zuberi, learned counsel for Mst. Naureen wife of Islamuddin Shaikh (judgment-debtor No.2) reiterating the above arguments added:-- (i) That the notice required under Order 21, C.P.C. was not given to his client who was consequently condemned unheard. (ii) According to the' memorandum of deposit of title deeds signed by Mst. Naureen and Mst. Kaneez Fatima relating to two properties their combined liability was limited upto a maximum of Rs.24 million plus all service charges, costs, commission expenses; consequently, the liability of his client, namely Mst. Naureen was limited upto a maximum of Rs.12 million only. He further submitted that under section 18(5) of the Banking Act, 1997, his client should be given an opportunity to purchase the property at the matching price offered by a third party. (iii) By virtue of section 60(c), C.P.C. the house in which the judgment- debtor is residing is exempted from attachment and consequently, this Court's order relating to attachment and sale of her residential house is without jurisdiction and should be withdrawn.

5. In reply, Mr. Haq, learned counsel for the decree-holder submitted that the executing Court cannot go behind the decree. Nevertheless, he submitted that the property claimed to be owned by Noman Shaikh son of Islamuddirr Shaikh, (objector) was the property of Mr. Islamuddin Shaikh on the day when it was mortgaged -i.e. on 7-6-1993 and continued to be so during the pendency of the proceedings until the Capital Development Authority,. Islamabad, allegedly approved the transfer in his favour on 9-7 1998 could not be acquired by him by transfer in view of the provisions of section 52 of Transfer of Property Act, 1882. He further, submitted that Noman son of Islamuddin Shaikh was not a party to the proceedings and, therefore, it was not necessary to issue any notice to him. He further, submitted that the Banking Act of 1997 is a special statute and the provisions. of Civil Procedure Code (C.P.C.) are not mandatory because the Court has the discretion to either follow the procedure provided in C.P.C. or any other procedure that it may deem fit. He added that the word used in section 39, C.P.C. relating to transfer of a decree to a Court within whose jurisdiction the immovable property is situated is "may" and not "shall" and, therefore, the Court has the discretion to execute the decree iii any manner deemed fit in case the immovable property is situated beyond its territorial jurisdiction.

6. In response to the arguments of Mr. Zuberi, counsel for judgment- debtor No.2, Mr. Haq, learned counsel for the decree-holder submitted that Mst. Naureen Shaikh had not only executed a memorandum of deposit of title deed but had also signed a guarantee to secure repayment of the facilities granted to. her.

7. I have heard the arguments of Mr. Abid S. Zuberi, learned counsel for judgment-debtor No.2 and Mr..Nadeem Azhar, learned counsel for the objector, Noman Shaikh son of Islamuddin Shaikh as well as the arguments of Mr. Mazhar-ul-Haq, learned counsel for the decree-holder in reply. 8 (i) It is well-established that' the executing Court cannot go behind the decree 1989 SCMR 640, 1971 SCMR 594, PLD 1960 Kar. 946 (DB) and PLD 1978 Kar. 205 (DB). Therefore, the arguments of A Mr. Nadeem that the decree is invalid to the extent that the documents executed by Mr. Islamuddin Shaikh did not create a mortgage cannot be considered at this stage. In any case, Mr. Islamuddin Shaikh, judgment-debtor NoA., had full opportunity to contest, the validity of the mortgage and after consideration of all documents and the relevant law the Court passed the decree for sale of the mortgaged properties under various mortgages including the mortgage in question; the Court, therefore, cannot go behind the decree now. Further C.M.A. 2234 of 1999 has been filed by Noman son of Islamuddin Shaikh under Order 21, Rule 58, C.P.C. which reads as follows:-- "

58. Investigation of claims to and objections to attachment of, attached property.

(1) Where any claim is preferred to, or any objection is made to the attachment of any property attached in execution of a decree on the ground that such property is not liable to such attachment, the Court shall proceed to investigate the claim or objection with the like power as regards the examination of the claimant or objector, and in all other respects, as if he was a party to the suit. Provided that no such investigation shall be made where it appears to the Court that the claim or objection whether made before or after the sale has been designedly or unnecessarily delayed, or was not made within a reasonable time or within one year of the date of the first attachment of the said property in the execution of the said decree, whichever is earlier, unless the claimant or objector.: (a) Proves title acquired in good faith and for consideration subsequent to the date of the first attachment, (b) proves that his predecessors-in-interest, whether their interest existed at the time of such attachment or was acquired thereafter, fraudulently omitted to make a claim or objection and (c) impleads all such predecessors-in-interest, as parties. From a bare reading of the above provision it is abundantly clear that the Court is competent to examine an objection to execution of a decree provided, inter alia, the claim or objection has not been designedly or unnecessarily delayed and the objector .proves that he acquired the title in good faith and for consideration and that his predecessors-in-interest had not fraudulently omitted to make a claim or objection. It is an admitted position that Mr. Islamuddin Shaikh, father of the objector, who has transferred the property to his son was a party to the suit, had ample opportunity to raise such defence but did not do so apparently with the ulterior motive to create circumstances to enable his son the transferee/objector to take such objection at the time of execution of the decree. The objection was, thus, designedly and, unnecessarily delayed. It is also apparent from the facts stated above that Mr. Islamuddin Shaikh who had guaranteed payment of the loan of judgment-debtor No. l was the owner of the property which was clearly specified in the plaint as mortgaged property over which the decree-holder was claiming an interest and right as a mortgagee and, therefore, it could not be validly transferred during the pendency of the proceedings in view of the bar contained in section 52 of Transfer of Property Act, 1882. The document filed by Noman Shaikh does not show that he acquired the property in good faith and for consideration. The transfer is, prima facie collusive and was made to deprive the decree-holder from recovery of their lawful dues. If such practice is allowed all bank borrowers will transfer to third parties their mortgaged properties with impunity in order to deprive the mortgagees of the, benefit of the mortgage security. The case of Messrs Eagle Star Insurance Co. Ltd. v. Messrs Usman Sons Limited and others PLD 1969 Kar. 123 referred to by Mr. Azhar is not applicable to the facts of this case. The cited case relates to a document whereby the mortgagor had in present mortgaged the property and consequently, it was held that the document required registration. In the present case, the memorandum of deposit of title deed refers to a past transaction of having deposited the deed which does not require any registration. Similarly, the case reported in 1985 CLC 391 is irrelevant and not applicable to the circumstances of the present case. Mr. Azhar also submitted that because there was no legal mortgage, Mr. Islamuddin Shaikh, judgment-debtor No.4 was free to transfer the property to his son. This argument itself patently shows the mala fide and fraudulent conduct of both the father and the son who manouvered the transfer of the property knowing full well that it was part of the subject-matter of the suit, which could not be transferred to anyone until the decision of the suit. Asghar Ali alias Sajid v. Fazal Karim 1989 SCMR 1781, Karam Elahi v. The Settlement Commissioner 1976 SCMR 143, Messrs Aman Enterprises v. Messrs Rahim Industries PLD 1993 SC 292 and Ardeshir Cowasjee v. K.B.C.A. 1999 SCMR 2883. The objector has no locus standi whatsoever and has obviously filed the objection to delay the execution. ` (ii) Order 21, Rule 22 clearly states that if an application for execution j is filed within one year from the date of the decree no notice for execution of the decree is required. Even otherwise Order 21, Rule 22(2) empowers the Court to order execution without notice. If it considers that issue of such notice would cause unreasonable delay. The objector was neither a party to the original proceedings nor had he given any notice to the bank/decree-holder that the property had been transferred to him. In the circumstances, he was not entitled to any notice. Further, he has come to this Court after he got the property transferred in his name in violation of law and by withholding relevant facts from C.D.A., Islamabad. He has come to this Court with unclean hands. The order, dated 15-11-1999 passed by this Court ordering execution of the decree by sale of the mortgaged property through the Official Assignee appointed as Receiver was in the circumstances of the case just and in accordance with law. The objection regarding notice taken by him is clearly mala fide. The argument of learned counsel is misconceived and cannot be accepted. (iii) Section 18(1) of the Banking Companies (Recovery of Loans) Act, 1997 reads as follows:-- "

18. Execution of decree.

(1) The Banking Court shall, on the written application of the decree-holder, forthwith order execution of the decree or order at any time seven day, after the passing of the decree or order and, where the decree or order pertains to money, may direct that the amount covered by the decree or order, as the case may be, shall be recovered in accordance with the provisions of the Code of Civil Procedure, 1908, or any other law for the time being in force, or in such other manner as the Banking Court may deemed fit;" It is an admitted position that the Banking Act. is a special statute and the provisions of the special law would prevail over the general provision of C.P.C. Section 18 of the Banking Act recognizes this position and clearly states that the Court has the discretion to either follow the procedure laid down in C.P.C. or follow any other mode. that the Court may deem fit in the circumstances of the case. According to the documents on record judgment -debtor No. l obtained financial facilities on or about 7-6-1993 and did not pay the same within the agreed time as a result of which the Bank was constrained to file the suit on 30-5-1995, inter alia, for recovery of. money and sale of the mortgaged properties. More than six years have passed since the financial facilities were provided and more than four years have passed since the filing of the suit and no payment has so far been made by the judgment-debtors to the decree-holder. In my view, to meet the ends of justice the decree must be executed expeditiously so that recovery may be made without delay. Consequently, the order of appointment of Receiver and sale of the mortgaged properties without strictly following the procedure provided in Order 21 is justified in the circumstances of the case. (iv) A simple reading of section 18(1) of the Banking Companies Act reproduced above shows that the provisions of C.P.C. are not mandatory but are only directory and the Court has been given the F discretion to execute the decree in accordance with the provisions of C.P.C. or in any other manner it may deem fit. It is also an admitted position that the Banking Companies (Recovery of Loans) Act, 1997 was enacted because the previous legislation in the field was not found effective for recovering the claims of the banks expeditiously and keeping in view the delays that were occurring the Legislature thought it fit to give greater flexibility and discretion to the Banking Courts so that the bank claims may be recovered without undue delay. Now section 39, C.P.C. reads as follows:-- "39(1) The Court which passed a decree may, on the application of the decree-holder, send it for execution to another Court-- (a)........................................................................... (b) ............................................................................ (c) if the decree directs for sale or delivery of immovable property situate outside the local limits of the jurisdiction of .the Court which passed it. (d)............................................................................ The argument of Mr. Haq, learned counsel for the decree-holder that the provisions of section 39, C.P.C. are directory and not mandatory as the word used therein is "may" and not "shall" has force. To achieve the G object of the Banking Companies Act, 1997, it is imperative that the Court exercise its discretion and execute the decree itself and not send it to another Court for execution which would unnecessarily delay the recovery. Moreover, there is no law which prohibits this Court from effecting sale of the property situated beyond its territorial jurisdiction through its own officer . i.e. the Official Assignee. In the present case the decree-holder who is in possession of the title deeds would give them to the Official Assignee who would sell the same expeditiously without any inconvenience. I have already held above that the Banking Court has the power to execute the decree in such other manner as it may deem fit ,accordingly, the order for sale of the (H property beyond its territorial jurisdiction by the Official Assignee is appropriate in the circumstances of the case. In view of this conclusion, it is not necessary to discuss the two ITidian cases cited by the learned counsel for the judgment-debtors and the objector. 9 (i) The argument of Mr. Zuberi regarding notice of execution of the decree is misconceived. Judgment-debtor No.2 was a party to the suit which was decided against her. She had notice of the same and I knew that her property would be sold in execution. No further notice was, therefore, necessary as the execution application was filed within one year of passing of the decree. (ii) The copy of the Memorandum of deposit of title deed available on the record does not state. that the iinhilitv of Mst Naureen is limited to Rs.12 million only. The document only states that Mst. Naureen and Mst. Kaneez Fatima shall be liable upto a maximum of Rs.24 million but it does not anywhere indicate that the two ladies shall share the liability equally. Further, the learned counsel has not denied that Mst. Naureen Shaikh has also executed a personal guarantee to secure repayment of the loan of defendant No.

1. Therefore, the liability of Mst. Naureen alongwith Mst. Kaneez Fatima is not limited to Rs.24 million as stated in the memorandum of deposit of title deeds but it is joint and several alongwith all the defendants in the sum of Rs.238,365,438 with mark-up at the rate of 48 paisa per 1,000 per day from the date of suit till the date of payment as decreed. It is, however, clarified that under section 18(5) of the Banking Companies Act, 1997, when the mortgage properties are sold, the bank shall, before concluding the sale, give an opportunity to Mst. Naureen and Mst. Kaneez. Fatima to purchase their properties at a matching price within thirty days of such notice to them. (iii) Mr. Zuberi urged that under section .60(c), C.P.C. the house owned and occupied by his client is exempted from attachment. To understand his objection, it would be advantageous to reproduce section 60(c), C.P.C. which reads as follows:-- . "60 .Property liable to attachment and sale in execution of decree.

(1) Provided that the following particulars shall not be liable to such attachment or sale, namely

(a) (b) . .......................................................................... (c) houses and other buildings (with the materials and the sites thereof and the land immediately appurtenant thereto and necessary for their enjoyment) belonging to an agriculturist and occupied by. him; The argument of the learned counsel is not bona fide. Firstly, the question whether Mst. Naureen is an agriculturist is a question of fact which has not been alleged in the application or the affidavit in support thereof. Secondly, to qualify for this exemption the judgment-debtor must show that he/she is an agriculturist and is occupying the house in connection with his/her agricultural occupation. The house, therefore, should naturally be K situated in agricultural area and must necessarily be connected with the use and enjoyment of the agricultural land. The mortgaged house which has been ordered to be sold is not situated in agricultural area but in Clifton which is a posh uraban residential locality of Karachi and is surrounded by luxurious houses, bungalows and town houses of the rich and nouveau riche. Thirdly, according to some authorities such a claimant must prove that he/she is substantially dependent on agriculture for his/her maintenance. No such assertion has either been made or proof tendered by the objection judgment- debtor. On the contrary, from the documents available on record it is apparent that judgment-debtor No.2 is a business woman as she is a Director of defendant No. l Company which is a business/commercial organization. The objection taken by counsel is prima facie mala fide and rejected. In view of the above discussion, it is clear that the objections filed and the arguments advanced in support thereof by the two objectors are mala fide and are patently vexatious to their knowledge. Accordingly, the objections are dismissed with special costs of Rs.15,000 to be paid by each objector to the decree-holder Q.M.H./M.A.K./H-12/K Objections dismissed.