2004 PLP 1424 (CLD)

Rafiq Ahmad Khawaja v. Abdul Haleem 1982 SCMR 1229. Zulifqar Ali v. Lall Din 1974 SCMR

162. Sher Muhammad v. Said Muhammad Shah 1981 SCMR

212. He further submits that mistake of a counsel is not sufficient ground for condonation of delay. In support of his contention he relied upon Naseem‑ud‑Din Siddiqui v. U.B.L. 1998 CLC 1718.

4. We have given our anxious consideration to the contentions of the learned counsel of the parties and perused the record.

5. It is better and appropriate to reproduce the relevant provisions of the Act No.XV of 1997 and Punjab Small Industries Corporation Act, 1973:‑‑ Banking Companies (Recovery of Loans Advances Credits and Financed Act 1997. Section 2(a) "banking company" means:‑‑‑ (i) any company whether incorporated within or beyond Pakistan which transacts the business of banking or any associated or ancillary business in Pakistan and includes a government savings bank; (ii) a modaraba or modaraba management company, leasing company, investment bank, financing company, unit trust or mutual fund of any kind and credit or investment. institution, corporation or company, whether industrial, agricultural or development;" Section 3:‑‑Constitution of the Corporation:‑‑‑ (1) As soon as may be after the commencement of this Act, there shall be established a Corporation to be known as "The Punjab Small Industries Corporation." (2) The Corporation shall be a body corporate, shall have the power to acquire and hold property, both movable and immovable, subject to the provisions of this Act and shall have perpetual succession and a common seal and shall by the said name sue and be sued. Section 18.:‑‑Functions of the Corporation:‑‑‑ (1) In accordance with the provisions of this Act, the Corporation shall take such measures as it deems fit to render assistance in the establishment and development of small, cottage and other industries. (2) In particular and without prejudice to the generality of the foregoing function, the Corporation may, in order to promote and carry out the purposes of this Act:‑‑‑ (a) give loans in cash, of in kind or in the form of buildings, .developed plots of lands in the small industries estates or machinery and equipment on lease or on hire‑purchase basis, to borrowers for the purpose of small, cottage and other industries; and (b) furnish guarantees to the Scheduled Banks for the repayment of loans to borrowers for the development of industries and to share losses on account of bad debts in accordance with the agreements executed or made in this behalf between the Corporation and such Banks. (3) The loans given under clause (a) or guaranteed under clause (b) of subsection (2) shall be repayable within a period not exceeding twenty years." Mere reading of aforesaid provisions of the two Acts in para materia makes it crystal clear that appellant No. 1 is covered under the definition of section 2(a)(i) of Act XV of 1997. We are fortified by the law laid down in Ghulam Sarwar v. S.H.O. 1999 Law Notes

560. Therefore, contention of the learned counsel of the appellants that appellant No. 1 is not mentioned in the schedule issued under section 2(a)(iii) has no force. It is pertinent to mention here that the competent authority has mentioned certain exceptions in schedule issued under section 2(a)(iii) of course of the categories which are not covered under section 2(a)(i) and section 2(a)(ii).

6. It is admitted fact that Banking Court has granted decree amounting to Rs.50,00,000 to the plaintiffs/ respondents without recording evidence in support of the contents of the plaint which is not in consonance with the law laid down by the Honourable Supreme Court in Messrs Qureshi Salt and Species Industries Khushab v. M.C.B. 1999 SCMR 2353. The relevant observation is reproduced hereunder:‑‑ "

10. We would .have allowed the above appeal on the above two grounds, but we find that it will cause miscarriage of justice instead of advancing the cause of justice. The jurisdiction is vested in the Courts to dispense justice and not to perpetuate injustice. In the present case the appellant has claimed a sum of Rs.4,08,53,000 on account of alleged breach on the part of the respondents not to advance a loan of Rs. Ten lac, which amount the appellant intended to recover through the summary procedure provided under Order 37, rules 1 and 2, C.P.C. for which he sought a decree without trial by filing the aforesaid Civil Miscellaneous Application No.8‑B of 1995 under Order 37, rule 2, C.P.C. read with section 151, C.P.C. That the Special Court has jurisdiction in respect of a claim filed by a banking company against a borrower or by a borrower against a banking company in respect of or arising out of a loan by virtue of clause (1) of section 6 of the Ordinance.

11. We would not like to express our view on the question as to whether the appellant's claim for damages for the above sum of Rs.4,08,53,000 can be said to have arisen out of a loan. However, we would observe that the above question needs examination. The learned Judge in Chambers acting as Special Court could not have passed a decree straightaway as the present claim for damages cannot be equated with a suit founded on a negotiable instrument. In this behalf reference may be made to the case of Haji Ali Khan & Company, Abbotabad and 8 others v. Messrs Allied Barik of Pakistan Limited, Abbotabad PLD 1995 SC 362 relied upon by Raja Muhammad Akram, learned Senior Advocate Supreme Court for the respondents, wherein while construing Rules 3 and 4, Order 37, C.P.C. this Court held as under:‑‑ "

10. The ratio decidendi of the above‑referred cases seems to be that if a defendant fails to appear or fails to obtain leave to defend in. response to a summons served in Form No.4 provided in Appendix B to the C.P.C. or fails to fulfil the condition on which leave was granted where the Court refuses to grant leave, the Court is to pass a decree. It may further be observed that in sub‑rule (2) of rule 2, C.P.C., it has been provided that if a defendant fails to appear or defaults in obtaining leave, the allegations in the plaint shall be deemed to be admitted and the plaintiff shall be entitled to a decree, but no such consequences are provided for in rule 3 of the above Order in a case where the Court refused to grant leave or the defendant ails to fulfil the condition on which leave was granted. In our view, notwithstanding the above, omission in rule 3, the effect of refusal of the Court to grant leave or failure on the part of the defendant to comply with the condition of the leave, will be the same i.e. the defendant shall not be entitled to defend the suit on any ground and the Court would pass a decree in favour of the plaintiff. However, this does not necessarily mean that the Court is not required to apply its mind to the facts and the documents before it. Every Court is required to apply its mind before passing any order or judgment notwithstanding the factum that no person has appeared before it to oppose such an order or that the person who wanted to oppose was not allowed to oppose because he failed to fulfil the requirements of law."

12. If we were, to set aside the above order of the learned Judge in Chamber on the above two grounds urged by the learned counsel, for the appellant, in our view, it would perpetuate injustice as the appellant might get a decree for the above huge sum of Rs.4,08,53,000 without proving the quantum of damages allegedly suffered by them on account of failure on the part of respondents to I, advance a loan of Rs. Ten lac. We are, therefore, of the view that in the above case leave should not have been granted. We, therefore, recall the leave granting order as was done by this Court in the following cases:‑‑‑ (i) Mst. Zubaida A. Sattar and others v. Karachi Building Control Authority and others 1999 SCMR 243; (ii) Muhammad Baran and others v. Member (Settlement and Rehabilitation), Board of Revenue, Punjab and others PLD 1991 SC ‑

691. It is also settled principle of law that a Judge must wear all the laws of the country on the sleeve of his robe and failure of the counsel to properly advise Judge was not a complete excuse in the matter as the law laid down in BISC, v. Salma Afroze PLD 1992 SC

263. The word "law" is defined by the Division Bench of this Court in Obyar and another's case PLJ 1984 Lahore 167 in the, following terms:‑‑ "Law is here not confined to Statute law alone but is used in its generic sense as connoting all that is treated as law in this country event the judicial principles laid down from time to time by the superior Courts."

7. The preliminary objection raised by the learned counsel of the respondent that the appeal of the appellants is highly time‑barred has no force in view of the law laid down by the Honourable Supreme Court in Shireen and others v. Fazal Muhammad and others 1995 SCMR 584 wherein the Supreme Court has taken a view that it is the duty of the Court to return the appeal to the concerned person to file before appropriate forum immediately. In case the Court returns the same after considerable delay then it is sufficient ground for condonation of delay keeping in view the principle laid down by the Legislature in its wisdom in section 14 of the Limitation Act. In the present case application for setting aside ex parte decree was dismissed on 2‑7‑1999 and Constitutional petition was filed by the appellant before this Court on 27‑9‑1999 which was disposed of by this Court on 17‑4‑2000 and appeal was filed on 24‑4‑2000. Therefore, question of limitation does riot arise in this appeal.

8. The contention of the learned counsel of the respondent that FAO is not competent before this Court has also no force in view of section 21(1) of Act No.XV of 1997 which inter alia provides that any person aggrieved by any order refusing to set aside a decree may prefer an appeal to this Court. In view of what has been discussed above, this appeal is accepted, impugned order is set aside, I consequently petitioners' application under Order IX, rule 13, C.P.C. is accepted and ex parte decree is set aside. Meaning thereby the respondents' suit as well as I application for leave to defend of the appellants shall be deemed to be pending before the Banking Court who shall decide the same afresh in accordance with law. The parties are directed to appeal before the Banking Court No.1, Lahore, on 15‑6‑2004 who is directed to decide they application of the appellants for leave to defend the suit and suit of the respondents afresh in accordance with law. No order as to costs. M.I./ P‑32/L Appeal accepted, case remanded.