2005 PLP 503 (CLD)

4. Learned counsel for the appellant, while referring to para 4 of order dated 16‑12‑1996, passed by the Honourable Company Judge in winding up petition (C.O.) No.51 of 1994), has submitted that although the Honourable Company Judge permitted respondent‑Bank to file the application before the Court, if they wish to continue with the suit, yet no such‑like application, seeking requisite permission to continue with the suit was filed after that date., therefore, the judgment and decree, passed by the learned Judge' Banking Court, is without jurisdiction. He has added that the learned Judge Banking Court was not competent to proceed and continue with the recovery suit, unless specifically allowed by the Honourable Company Judge. Conversely, the learned counsel for respondent‑Bank, while referring to order dated 16‑9‑1996, passed in the same winding up petition, has submitted that the Honourable Company Judge specifically permitted the learned Judge Banking Court to continue with the proceedings in the suit, therefore, there was no legal hurdle before the learned Banking Court to decide the suit. He has further submitted that the learned Company Judge, without noticing order dated 16‑9‑1996, has observed in order dated 16‑12‑1996 that the Bank can seek permission to continue with the proceedings in the suit.

5. Both the learned counsel admit that orders dated 16‑9‑1996 and 16‑12‑1996, relied upon by them; were passed by the Hon'ble Company Judge in one and the same winding‑up petition (C.O. No.51 of 1994). It would be appropriate to reproduce relevant portion of order dated 16‑9‑1996, relied upon by the learned counsel for the respondent‑Bank, which reads as follows:‑‑ "Learned counsel for respondent No.1 says that the suit filed by the said respondent against the company before the Banking Tribunal is pending and the proceedings in the same have been stayed by the said Tribunal on account of pendency of this petition. In this petition no order has been passed for staving the proceedings in the said suit. The proceedings in the said suit are permitted to be continued. The provisional Manager appointed by this Court in this case shall defend the said suit along with the other defendants already impleaded in the said suit. The provisional Manager shall approach the said Court and, make application for this purpose. Learned counsel for respondent No.1 wants to file reply to C. M. No.72/L of 1996." (Underlining is ours). It is evident from the bare reading of the aforenoted order that the Hon'ble Judge specifically allowed the proceedings in the suit for recovery is to be continued and already appointed provisional Manager was directed to defend the suit.

6. Section 316(1) of the Companies Ordinance, 1984, envisages that when a winding up order has been made or a provisional Manager has been appointed, no suit or other legal proceeding shall proceed against the company except by the leave of the Court. The said provision of law is reproduced below for ready reference:‑‑ 316(1) "Suits staved on winding‑up order.‑‑‑(1) When a winding‑up order has been made or a provisional Manager has been appointed no suit or other legal proceedings shall be proceeded with or commenced against the company except by leave of the Court, and subject ‑to such terms as the Court may impose." It flows from the perusal of the aforesaid provision of law that when winding‑up order has been made or a provisional Manager has been appointed, the proceeding in the suit or other legal proceedings shall remain stayed only against the company and cannot further proceed except with the leave of the Court. If any party wishes to commence or continue with the proceedings, then it has to file the application under section 316(1) of the Companies Ordinance, 1984, before the learned Company Judge seeking his permission to proceed, continue and commence with the proceedings against the company and the Court may grant such permission, subject to certain terms. Placing the said provision of law in juxta‑position with the order dated 16‑9‑1996, we are of the firm view that the learned Company Judge through a specific and conscious order permitted the Banking Court to continue with the proceedings in the recovery suit, filed by the respondent- Bank, inasmuch as the provisional Manager was directed by the learned Company Judge to approach the Court and make application. In view whereof, we are firm in our views that the learned Company Judge granted permission to the respondent‑Bank and the learned Banking Court, which was seized of the suit for recovery, to continue and proceed with the proceedings, thus, the learned Banking Court was justified in passing the impugned judgment and decree.

7. There is another aspect of the case. As noted above, section 316(1) of Companies Ordinance, 1984, provides that after the passing of the winding‑up order or the appointment of provisional Manager, no suit or legal proceedings shall proceed with or commence against the company. Thus, upon the happening of aforesaid two eventualities, the proceedings cannot commence or proceed only against the company, while the proceedings against the other persons arrayed in the suit as defendants in the capacity of guarantors/ mortgagers/beneficiaries, apart from the company, can be proceeded with, continued and commenced even without the leave of the Court. The appellant did not represent the company at any stage, although she was one of the directors. Admittedly, she did not file winding‑up petition. The present appeal has only been filed by Mst. Tanis Akhtar, the appellant, who was arrayed as defendant No.3 in the suit for recovery. Even it be conceded for the sake of arguments that no permission was granted to continue with the suit, at best, the said argument, now canvassed by the learned counsel of 'the appellant, was available to .the company, who choose not to file the appeal in hand and instead thereof it has been arrayed as one of the respondents. The appellant, being one of the defendants, cannot raise the said plea, because in any case the proceedings had to be continued against her, even if no permission was granted to the respondent- Bank to continue with the proceedings in the suit. It. does not lie in the mouth of the appellant, being the defendant in the suit, to say that the decree passed against her is without jurisdiction, as in any case proceedings against the appellant and other defendants were to proceed and continue notwithstanding the fact that the company was ordered to be wound up, that provisional manager was appointed or/and no permission was granted to continue with the proceedings. The solitary contention raised by the learned counsel of the appellant is without any substance, hence repelled.

8. Now coming to order dated 16‑12‑1996, passed by the learned Company Judge and relied upon by the learned counsel for the appellant. Para.4 of the said order is reproduced below:‑‑ "This apprehension of the learned counsel is ill -founded as no such consequences follow from winding‑up of the company. In any event, if the respondent No.1 wishes to continue with the suit filed by it, it can seek permission from this Court." It is evident from the above that the learned Company Judge, while passing the aforenoted order did not consider, review or recall his earlier order dated 16‑9‑1996, wherein, permission to continue with the suit already stood granted, as held above. The observations of the Hon'ble Company Judge, that if respondent No.1 wishes to continue with the suit, it can seek permission from this Court, does not mean that the previous order, granting permission to continue with the proceedings in the suit for recovery, has been recalled, superseded or rescinded, automatically. It appears from the tenor of order dated 16‑12‑1996, that order dated 16‑9‑1996, was not brought to the notice of learned Company Judge at the time of the passing of the latest order on the same subject. In any event, this order does not require the respondent -Bank to seek fresh permission from the Court to continue with the proceedings in the suit. Had the learned Company Judge, in order dated 16‑12‑1996, taken note of the earlier order dated 16‑9‑1996 and observed that after winding‑up of the company, fresh order to continue with the proceedings is required, in that case the position would have been different. In the said perspective, we are of the considered view that once the order dated 16‑9‑1996, specifically permitting the learned Banking Court to continue and commence with the proceedings in the suit for recovery, was passed, there was no need to pass a fresh order on the same subject. Order dated 16‑12‑1996, was passed without taking into consideration the previous order on the same issue. Undeniably, order dated 16‑12‑1996, does not supersede, recall, review or set aside the earlier order, passed by the Court. Furthermore, as held above, the appellant cannot take benefit of the aforenoted position and the company has not filed any appeal against the impugned judgment and decree.

9. Seeing from any angle, the appellant has comprehensively failed to make out a case calling for interference by this Court in the impugned judgment and decree in exercise of its appellate jurisdiction. The impugned judgment and decree was legally passed by the, learned Banking Court, having the jurisdiction in the matter. We do not find any legal infirmity in the impugned judgment and decree, thus, the same are hereby maintained.

10. Upshot of the above discussion is that the present appeal is devoid of merits, hence the same stands dismissed with no order as to costs. M.H./T‑68/L Appeal dismissed.