Suit for recovery of loan amount

"Default" means failure to fulfill the conditions of a contract to pay the loan, either whole or installments and includes an unfulfilled obligation.

Both plaintiff and defendant have similar responsibility to plead and state in unambiguous terms the finances availed by the defendants, repayments made by them with the dates and the amounts of finance repayable by such defendants who are also under obligation to specify the amounts disputed by them.

Banking suit is normally a suit on accounts which are duly ledgered and maintained compulsorily in the books of accounts under the prescribed principles/standards of accounting in terms of the laws, rules and banking practices

As such instead of leaving it to the option of the parties to make general assertions on accounts, the Ordinance binds both the sides to be absolutely specific on accounts.

Term "willful default" is though defined under S. 2(g) of the Ordinance, which means deliberate and intentional failure of the customer to repay financial assistance secured from a financial institution yet the requirement under S. 9 is "default" simipliciter.

Banking Court with the consent of the parties appointed evaluators to carry out evaluation and applicant was directed to deposit fee of the evaluator but he did not deposit the same

Banking Court fixed reserve price of the property and appointed a Court Auctioneer to conduct auction

Said order of Executing Court was never challenged which had attained finality

Court Auctioneer conducted auction of property and respondent was declared as highest bidder who deposited the bid price which was more than the reserve price

Petitioner could not be allowed to agitate the non-fulfilment of the requirements ordained by O. XXI, R. 66, C.P.C.

Objection petition moved by the judgment-debtor was not accompanied by the statutory deposit as contemplated by O. XXI, R. 90, C.P.C.

Applicant having also made mandatory deposit of 20% of the sum realized at the sale, appeal was dismissed.

Auction proceedings of mortgaged property were conducted in the year 2008 (05-06-2008) under S.15 of the Ordinance whereas the said Section was declared ultra vires the Constitution on 10th of December 2013 by the Supreme Court; as such, the Banking Court had rightly held that auction dated 05-06-2008 had become a past and closed transaction and could not be resurrected

Constitutional petition was dismissed in circumstances.

Appellant moved objection application to the effect that he was ready to pay the decretal amount but objection petition was dismissed by the Banking Court

Validity

Appellant had not filed appeal against the impugned decree within prescribed period of limitation or at any time thereafter

Appellant remained inextricably involved in the execution and auction proceedings and made applications therein which were duly heard and decided on merit

Appellant had failed to make the mandatory deposit required to prefer present application and had already forgone his right to appeal

Application assailing the execution proceedings and result thereof was not tenable in law

Appeal was dismissed in circumstances.

Limitation for filing of suit for recovery of loan amount was three years.

Banking Court established by Government of Pakistan decreed the suit for recovery of Bank loan but High Court Azad Jammu and Kashmir Pakistan set aside the said decree

Validity

Jurisdiction could not be conferred upon the Courts by joining the proceedings by the parties nor Courts could be created without law made under the Constitutional provisions

Court so authorized was neither established by the Azad Jammu and Kashmir Government or Azad Jammu and Kashmir Council nor same was in the control of Azad Jammu and Kashmir Government or Council

Conferment of such powers on the authority or person who was neither established nor controlled by the Azad Jammu and Kashmir Government or Council was void

If it had come to the notice of the Court that legislation locked the Constitutional backing or was promulgated without Constitutional competence same should have been declared ultra vires or ignored

Any law which was made without Constitutional competence was void

Authorization to Banking Court established by the Government of Pakistan to try cases relating to the territories of Azad Jammu and Kashmir was void and was to be deemed to be inoperative

Any proceedings conducted or decree passed by such non-existent Court had no legal status or effect

High Court had rightly accepted the appeal in circumstances

Impugned judgment did not suffer from any legal infirmity

Appeal was dismissed in circumstances.

Contention of the applicant was that he was not residing at the given address and could not be served and decree was obtained on the basis of fraud and misrepresentation

Application for setting aside ex parte decree was dismissed by the Banking Court

Validity

Notices were issued to the applicant at the address provided by him on the form for availing finance facility

Banking Court had adopted all the modes to procure the service of applicant prior to passing ex parte judgment and decree

Applicant had failed to prove the necessary requirement i.e. fraud, misrepresentation and want of jurisdiction for setting aside the impugned judgment and decree

If fraud was alleged in an application filed under S. 12(2), C.P.C. then its necessary ingredients must be pleaded so as to subsequently prove the same

General and bald allegations of fraud and misrepresentation could not form basis to upset a decree otherwise validly passed by a Court of competent jurisdiction

Applicant had failed to prove fraud and misrepresentation by the Bank for obtaining ex parte judgment and decree

Banking Court had rightly dismissed the application for setting aside ex parte decree

No illegality or perversity had been pointed out in the impugned order

Appeal was dismissed in limine in circumstances.

Defendant could not simply put up a denial simpliciter in his application for leave to defend in answer to a claim of financial institution which was backed up by a statement of account and other finance documents

Bare denial of liability was never held to constitute a valid defence in law

Mark-up on the finance facilities had been charged outside the period of finance facility which amounts were deleted from the suit claim

Claim of plaintiff Bank was substantiated by the documents available on record

Defendant had failed to raise any substantial question of fact warranting recording of evidence for its resolution

Petition for leave to appear and defend the suit was dismissed

Suit was decreed in favour of plaintiff Bank and against the defendant jointly and severally with costs of funds.

Executing Court would be free to issue non-bailable warrants for the arrest and production of judgment-debtor and pass order of detention of the petitioner in civil prison or any other order in accordance with circumstance of the case

Trial Court might issue process against sureties of petitioner produced before the Single Judge

Revision was dismissed in circumstances.

Executing Court would be free to issue non-bailable warrants for the arrest and production of judgment-debtor and pass order of detention of the petitioner in civil prison or any other order in accordance with circumstance of the case

Trial Court might issue process against sureties of petitioner produced before the Single Judge

Revision was dismissed in circumstances.

Contentions of judgment debtor were that value of the property sought to be auctioned was more than what had been assessed by the evaluator and that evaluator had not mentioned the covered area of the building correctly

Validity

Fixing the value of the property was a matter of opinion and court could not give its opinion on such a point

Sale price in the auction conducted by the court should be accepted as purchaser/bidder had to take risk of litigation

Reserve price fixed by the court and forced sale value determined by the evaluator should be one and the same

Reserve price had to be fixed to protect the interest of judgment-debtor against a collusive and insufficiently competitive auction

Proclamation of sale should contain everything which the court consider material for a purchaser to know

Court should give preference to the evaluation report prepared under its orders rather than a report which was prepared at the behest of judgment-debtor

Judgment-debtor could bring a buyer of his choice either in auction or before the court prior to the sale if property was being sold for a price on the lower side

Court could postpone sale of property to enable the judgment-debtor for raising money through private sale of the same

Description of property should be fairly and accurately described in the auction schedule

Details with regard to superstructure or constructed area were not necessary to be contained in the auction schedule

Purchaser could ascertain for themselves the constructed area within the boundary walls of the property

Court sales did not entail warranty of title

Objections application was dismissed in circumstances.

Financial Institution could file a suit against the consumer through branch manager or such other officer as might be duly authorized in that behalf by power of attorney or otherwise

Present suit had been filed by the bank manager who was competent to file the plaint

Bank manager had filed plaint after fulfilment of mandatory requirement of S.9 of Financial Institutions (Recovery of Finances) Ordinance, 2001

Consumers-defendants had not challenged the legality or genuineness of finance agreement and charged documents before any court of law

Defendants had accepted the terms and conditions settled between the parties

Consumer had right to utilize the finance facility subject to terms and conditions of agreement and charged documents

Plaintiff-bank was entitled to principal amount (due) including mark-up, cost of finances till the date of expiry

Defendants-consumers had failed to raise any substantial question of law and facts

Banking Court had rightly dismissed the application for leave to defend the suit

Controversy with regard to principal amount, mark-up and cost of finances could be resolved keeping in view the documents available on record

Principal amount was outstanding against the consumers and Bank was entitled for the same including mark-up, cost of finances till the date of expiry

No illegality, material irregularity or non-appreciation of documentary evidence had been pointed out in the findings recorded by the Banking Court

Appeal was dismissed in circumstances.

Financial Institution could file a suit against the consumer through branch manager or such other officer as might be duly authorized in this behalf by power of attorney or otherwise.

Section 9 of Financial Institutions (Recovery of Finances) Ordinance, 2001 empowered three categories of persons to file suits on behalf of the financial institutions; the branch manager; an officer authorized by a power of attorney; and, an officer who was otherwise authorized by financial institutions

Section 9 of Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997 and Financial Institutions (Recovery of Finances) Ordinance, 2001 differed only by inclusion in the latter law the category of officers who were authorized through a power of attorney to institute the suit and by omission of officers who were authorized by the Board of Directors of a financial institution

Section 9 of the Ordinance was indicative of the intent of the Legislature and conveyed a definite meaning that those officers were competent to institute suits on behalf of the financial institutions on the strength of the power of attorney, which necessarily followed that those officers did not need to append anything else other than the power of attorney to demonstrate their authority to institute the suit under S. 9 of the Ordinance

Due authorization of the officer to file the suit flowed from the power of attorney in terms of S. 9 of the Ordinance and not from any other document

Any interpretation that required such category of officers to substantiate the authority of the executant of the power of attorney would nullify the effect that the Legislature intended by modifying S. 9 of the Ordinance

Officer of the financial institution holding power of attorney was designated person to file suits on its behalf apart from the Manager by the force of S. 9 of the Ordinance

Any other officer other than the Manager and the officer holding the power of attorney would be required to show due authority from the financial institution for filing of the suit

Word 'or' appearing between the three categories of persons in S. 9 of the Ordinance had to be read as 'and' and the three categories were to be read disjunctively entitling each of them to validly institute suit on behalf of a financial institution

Manager of a financial institution had recognized to be the authority to validly institute the suit in terms of S. 9 of the Ordinance

Words 'as Board of Directors of a banking company might authorize in that behalf' had been excluded on purpose from S. 9 of the Ordinance for simplifying the institution of suits and to obviate the task of the officers filing suits to show authorization from the Board of Directors of the financial institution; as such, those words could not be included in S. 9 of the Ordinance through the back door by judicial interpretation

By promulgating the Ordinance and bringing changes and modification in S. 9 of the Ordinance the purpose was to render validity to the practice of filing of suits by the financial institutions through officers holding general power of attorney

Power of attorney is a legal term of act that has a widely accepted common law meaning and was governed by Power of Attorney Act, 1882

All kinds of powers could be exercised by the donee of the power of attorney, including filing suits if such a power is reserved in the instrument creating the power of attorney

General power of attorney in favour of the officer, who had instituted the present suit, was available on the record, which contained the power to commence and institute a suit for and on behalf of the Bank; thus, the suit had validly been instituted in terms of S. 9 of the Ordinance

Statement of accounts had been duly certified by the Bankers' Books Evidence Act, 1891

Defendant had not met the mandatory requirements of S. 10 of the Ordinance, which had resulted in dismissal of the suit

Dismissal of the application of leave to defend meant that all the allegations made in the plaint would be deemed to have been accepted and the Banking Court was obliged to pass a decree thereon

Defendant had not disputed the principal liability and only called into question the claim of mark up on the ground that payment of mark up had not been included in the terms of the finance agreement

Sanction letter and finance agreement appended with the plaint stipulated for the payment of the mark-up by the defendant

Defendant had failed to raise any bona fide defence

Appeal was dismissed in circumstances.

Application for leave to appear and defend the suit had not been decided while passing the impugned judgment and decree by the Banking Court

Impugned judgment and decree was void in circumstances

Plaintiff had neither filed any reply to the application for leave to appear and defend the suit nor counter affidavit

Plaintiff, therefore, had admitted the facts and ground narrated in the application for leave to appear and defend the suit

Impugned judgment and decree were set aside

Held, application for leave to appear and defend the suit would be deemed to be pending before the Banking Court who should decide the same on merits

Appeal was allowed in circumstances.

Banking Court dismissed application for leave to appear and defend the suit and decreed the suit filed by the plaintiff-Bank

Contention of defendants-customers was that no statement of account was filed with the plaint by the plaintiff-Bank

Validity

Plaint should be supported by a statement of account which in case of financial institution should be duly certified under Bankers' Books Evidence Act, 1891 and all other relevant documents with regard to grant of finance

Defendants-customers availed cash finance facility of Rs.5,000,000/- which was outstanding against them

Plaintiff-Bank had annexed one page statement of account of assets and mark up whereas one page statement of other account of customer liabilities mark up with the plaint

Said statements had been certified and signed by an officer and manager but neither the name of manager nor the name of officer was present underneath their signatures

No date had been mentioned as to when such statements were certified by the manager and officer of the Bank

Every amount/sum advanced or paid to a customer or sum expended/incurred for and on behalf of a customer by a banking company should be entered as "debit" in the ledger of Bank

Money received from or on behalf of customer should be entered as a customer's "credit"

Such statement of account was required to be conveyed to the customers informing them of their account position and obligations towards the Bank and vice versa

Statement of account so certified would become admissible in evidence, transactions and accounts therein recorded like original entry unless otherwise disputed

Statement of accounts annexed by the Bank with the plaint did not show all transactional entries, debit and credit entries, rate of mark-up, rate of excise duty and rate of commitment charges

Documents annexed by the Bank, in the present case, could be called only the "certificate of balances"

No presumption of admissibility could be given to the "certificate of balances"

Impugned decree was passed upon an inadmissible document i.e. "certificate of balances"

Filing of complete and accurate statement of account with the plaint was a mandatory requirement which defect could not be rectified through replication

Only deficiency that affidavit attached with the application for leave to appear and defend the suit was not in an elaborate form did not render the said application ineffective

Impugned judgment and decree passed by the Banking Court was not sustainable which was set aside

Application for leave to appear and defend the suit was accepted subject to submission of surety bond equal to the decretal amount before the Trial Court within fifteen days of appearance of defendants-customers

Case was remanded to the Banking Court for decision afresh on merits in accordance with law.

Service of the applicants was required to be procured by adopting all modes mentioned in S. 9(5) of the Financial Institutions (Recovery of Finances) Ordinance, 2001

Applicants were not residing at the given address and process through summons could not be served upon them

Specific plea was taken by the applicants that they were not residing at the given address

Fate of the application for setting aside ex parte decree could not be decided summarily

Trial Court should have disposed of the application by casting issues and providing an opportunity to the adversaries to substantiate their contention involving factual controversy

Omission on the part of the Trial Court to act in the manner suggested had made all the orders impugned as well as judgment and decree nullity in the eye of law

Impugned orders as well as judgment and decree were set aside and matter was remanded to the Trial Court to decide the application for setting aside ex parte judgment and decree in accordance with law within specified period

Appeal was allowed in circumstances.

Decree, in the present case, was simultaneous and had been passed jointly and severally against all the defendants, including (present) judgment debtor, who had been sued in his capacity as guarantor/mortgagor

Defendant had not taken any plea in his defence in the suit that his liability was contingent upon and subject to the exhaustion of remedies by the plaintiff-Bank against the principal debtor and his failure to satisfy the dues under the decree

Judgment and decree also did not contain any findings of Banking Court in favour of the defendant to that effect

Decree, which had become final, could not be construed otherwise

Executing Court could not go beyond the decree

Any plea that the liability of the principal debtor had been satisfied ahead of the defendant/guarantor/mortgagor, had to be taken during the suit and not after the decree when the execution was being levied

Unless contrary was contained in the decree, where the creditor had obtained a decree against the surety and the principal debtor, the surety/mortgagor had no right to restrain execution against him until the creditor had exhausted his remedies against the principal debtor

Section 128 of Contract provided that the liability of the surety was co-extensive with that of the principal debtor, unless the contract provided otherwise

Expressions 'guarantor', 'principal debtor' and 'mortgagor' were only used in the suit for purposes of adjudicating upon their rights as such

Once the decree was passed, the same had to be executed by its terms and not in accordance with the relationship inter se the parties prior to passing the decree

After fifteen years of the pending execution proceedings, the court auctioneer had finally been able to successfully conduct the auction could not be set aside merely on general allegations

Banking Court, dismissing objection application, approved the sale and made the same absolute

Applications were dismissed in circumstances.

Defendant, the judgment debtor filed application under S. 19(7) of Financial Institutions (Recovery of Finances) Ordinance, 2001 for setting aside of the auction on ground of conduct of the auction

Validity

Said application in essence was an application under O. XXI, R. 90, C.P.C., thereby, the conduct of the auction had been challenged

Order XXI, Rr. 89 & 90, C.P.C. mandated that the objector should deposit the amounts mentioned in the decree along with the application, and in absence of the deposit, the application could not be entertained by the Banking Court

Defendant was liable to pay 20% of the bid money before their application could be entertained

Defendant had failed to provide any material particular in the application about the irregularity and fraud in publishing and conducting the sale and had instead resorted to making general allegations

In addition to proving material irregularity or fraud, the defendant had also to prove substantial injury, the onus of which was on the defendant

Defendant had failed to allege or prove any substantial injury caused to him from the sale of the property

Successful bidder, having deposited the entire bid money within the time stipulated by law, had acquired valuable rights in the property

Objection application was dismissed in circumstances.

Defendant, the Judgment debtor, filed two consecutive applications for deletion of the property in question from Fard Taliqa on ground that the same had not been mortgaged with the decree holder bank, which were dismissed by the Executing Court

Validity

Orders passed on the applications had never been challenged and the same had already attained finality

Objection as to the property not having been mortgaged was, therefore, no longer available to the defendant

Application was dismissed in circumstances.

Trial Court dismissed suit at leave stage on the ground that decree in the first suit had attained finality and second suit on the same cause of action was barred

Validity

Banking Court could not dismiss suit at leave stage

Proper course for Banking Court was to grant leave to defend the suit to the defendants and then to frame issues for its decision thereon

Banking Court in first suit directed the defendants to keep on depositing the instalment amount of loan as per terms of the agreement

Whether said direction had furnished a fresh cause of action was to be thrashed out by the Banking Court

Trial Court had not disclosed under which provision of law second suit was time barred

Impugned order passed by the Trial Court was not sustainable which was set aside

Suit would be deemed to be pending before the Banking Court which should be decided after granting leave to defend the suit to the defendants.

If complaint was decided ahead of the proceedings in execution then judgment-debtor would be prejudiced in case it was found that liability could not be fixed on him for misappropriation of pledged stocks

Criminal complaint, therefore, could not proceed determination of civil liability

Proceedings in complaint case pending before the Banking Court were stayed till the decision in execution petition with regard to misappropriation of pledged stocks

Constitutional petition was accepted in circumstances.

Defendant filed application for leave to defend which was conditionally accepted by Trial Court subject to deposit of certain amount within one month

Validity

Banking Court, while granting leave to defend suit in terms of S. 10(8) of Financial Institutions (Recovery of Finances) Ordinance, 2001, was empowered to impose conditions on defendants

Rigors of S. 22(6) of Financial Institutions (Recovery of Finances) Ordinance, 2001 were fully applicable and remedy of appeal was not available against such order

Party could not be allowed to challenge orders through constitutional petition which were otherwise non-appealable, as it would amount to negate provisions of Financial Institutions (Recovery of Finances) Ordinance, 2001, which prohibited remedy of appeal against leave granting order

Banking Court, in its discretion, could also impose any condition while granting leave to defend the suit in terms of S. 10(9) of Financial Institutions (Recovery of Finances) Ordinance, 2001

Constitutional petition was dismissed in circumstances.

Impugned decree provided payment of the markup on the decretal amount to the plaintiff-Bank at a specified rate from the date of institution of the suit till realization, which was permissible under Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997 prevailing at the relevant time

Supreme Court had dismissed the appeals filed by the defendant against the judgment and decree and against the confirmation of the sale of its assets in favour of the auction purchaser; thus, the decree in favour of the plaintiff-Bank and the sale of the assets in the execution proceedings had attained finality

Defendant therefore, was not justified, both in the execution proceedings or before Appellate Court to challenge the grant of mark-up to the plaintiff-Bank from date of filing of the suit till realization or to raise objection regarding the alleged irregularities at the time of auction of its assets

Executing Court was duty bound to execute the decree in letter and spirit and it could not go behind the decree

In terms of S. 73, C.P.C., in order to qualify for ratable distribution of the sale proceeds in execution proceedings amongst decree holders and to succeed in application filed in that behalf, the decree holder must establish that the assets were held by the Court, all the decrees were money decrees, the decrees were against the same judgment debtor, the application for ratable distribution was made to Court holding the assets, and such application was made prior to receipt of the assets by the Court

Assets were deemed to be received by the Court when the entire purchase money was actually deposited in the Court, in case of auction of immovable property, the date of the receipt of the assets was the day on which the entire money was paid under O. XXI, R. 85, C.P.C.

Intervener Bank had filed the application for ratable distribution after the receipt of the assets by the Court, which would disentitle the said Bank to claim ratable distribution

Executing Court had allowed the application of the intervener Bank on the ground that after satisfaction of the plaintiff-Bank's decree, excess amount was available

No reason had been given in the impugned order for deviating from the provisions of S. 73, C.P.C. and for granting the relief to the intervener Bank to which it was not entitled

Impugned order, to the extent of grant of ratable distribution, was therefore, against the express provision of S. 73, C.P.C.

Ratable distribution, ought not have been allowed in favour of the intervener Bank

Executing Court had specifically directed the Official Assignee to examine the plaintiff Bank's objection as to calculation of markup, in compliance of which the Official Assignee had submitted the Reference disclosing the amount of the decree, rate and amounts of markup payable to the plaintiff Bank from date of institution of the suit till certain date and the amount already paid to plaintiff Bank and that after calculating the markup payable to the plaintiff Bank and amounts received by said Bank, the balance amount of certain sum was still payable to the plaintiff

Impugned order was, however, silent about the said reference and the amount stated therein as payable to the plaintiff

Calculation regarding markup sought by the Executing Court on the specific objection raised by plaintiff Bank had not been considered at the time of passing of the impugned order, and no reason had been stated therein for not considering or accepting such calculation

Executing Court was under its statutory duty to execute the decree by ensuring that plaintiff Bank received markup as per the decree from the date of institution of the suit till realization

Executing Court, therefore, had gone behind the decree by modifying the same by holding that plaintiff was not entitled to markup till realization of the decree

Under O. XLI, R. 33, C.P.C., the High Court could exercise the appellate powers in favour of all or any of the parties although such parties might not have filed any appeal or objection

High Court, under O. XXI, R. 33, C.P.C. had the power to make such further or other order as the circumstances of the case might require, and that power could have been exercised in favour of plaintiff Bank even though the said Bank had not filed an appeal or cross-objections and further to provide the remedy against the party that was really liable

High Court, setting aside the impugned order, observed that intervener Bank might seek execution and satisfaction of its decree by filing execution proceedings against the judgment debtors

High Court, revived the execution application, and observed that the plaintiff-Bank would be paid markup from the date of institution of the suit till realization strictly in terms of the decree, all amount received by intervener Bank on account of ratable distribution would be returned/deposited with the Official Assignee, and after payment of all the amounts to plaintiff Bank as per the decree, the remaining/excess amount would be released in favour of the defendant

Appeal was disposed of accordingly.

Plaintiff-Bank did not produce any document to substantiate claim of Moqadam charges and security guard charges, hence such amounts as claimed were also not justified.

Contention raised by defendants was that as right to fair trial had been guaranteed as fundamental right under Art. 10-A of the Constitution, thus S. 10 of Financial Institutions (Recovery of Finances) Ordinance 2001 was contrary to that fundamental right, and that hurdle to defend suit by recording evidence was to be treated ultra vies

Validity

Article 10-A of the Constitution provided opportunity of fair trial, but same did not amount to trial of suit where neither any question of law nor fact had been established

Article 10-A of the Constitution also provided for determination of civil rights and obligations

Once due process as required in terms of Financial Institutions (Recovery of Finances) Ordinance, 2001 was adopted, defendant was before court for redressal of his grievance

All the defendant had to do was to establish question of fact and law for determination of civil right and obligation by court

Application for leave to defend was supposed to be in form of written statement, which would be containing summary of substantial question of law and fact in respect of which, in opinion of defendant, evidence needed to be recorded

Under parameters of Financial Institutions (Recovery of Finances) Ordinance, 2001, defendant was entitled for relief if question of law and fact had been established

Questions as raised by defendants had been answered categorically and due process of law had been followed.

Plaintiff-Bank filed present suit for recovery of loan amount; whereas, defendant filed connected suit seeking concessions regarding their outstanding liabilities requiring plaintiff-Bank to sign agreement in terms of decision made by Committee of State Bank of Pakistan under BPD Circular No. 29

Validity

Plaintiff-Bank could be coerced to sign any unilateral agreement, terms of which had never been agreed by Bank, as hit by provisions of Ss. 13, 14 & 16 of Contract Act, 1872

No cause of action against law

Plaintiff in connected suit was not only required to show that not only his rights had been infringed but also that right to seek a relief was in existence

BPD Circular No.29 did not provide right to defendants, unless they met precondition as set out in the said Circular, such as where chances of recovery of loan were 'negligible' or unit was considered as sick

Enforcement of BPD Circular No.29 by individual Banks to their respective customers was prerogative of the Banks

Banks were to decide whether debt outstanding against customer was lost debt or recoverable in terms of assets mortgaged with them

Plaintiff-Bank, who was sole decision maker as to recovery of outstanding liability, had never undertook to resolve dispute according to terms of alleged settlement of liabilities under BPD Circular No.29

In the present case, probability of recovery was not negligible, as properties were mortgaged and guarantees were enforceable

Banking Court was required to find out as to whether any question of law and fact was raised which was to be determined and whether allegations made in the plaint would give rise to cause of action or not

Filing of suit by defendant, who otherwise had no cause of action against financial institution, could not be considered to be a guarantee for grant of leave to defend the suit filed by financial institution

Orders XIV & XV, C.P.C., which dealt with issues, also supported that if parties were not at issue, judgment was to be passed straightaway without recording evidence

If no cause of action was made out, plaint was liable to be rejected

No ground, therefore, existed to consider the leave applications which were dismissed and plaint of suit filed by them was rejected

Suit for recovery of loan amount was decreed in circumstances.

Defendants later formed private limited company for purpose of taking over entire business of defendant-proprietary concern-Finance facilities and outstanding liabilities of defendant-proprietary concern were transferred to defendant-company after rescheduling, enhancement and renewal of same

Contention raised by defendants was that as plaintiff-Bank and defendant-company had entered into finance agreements agreeing to own liabilities of defendant-proprietary concern without knowledge of other defendants, said other defendants had been discharged from liabilities due to novation of contract under Ss. 133 & 135 of Contract Act, 1872

Validity

Last rescheduling had been executed by defendant-proprietary concern

Defendant-company, after said transfer of outstanding liabilities, had entered into finance agreement, thereby agreeing the purchase price to be payable to Bank within seven years

Said rescheduling had been done on condition that defendant-proprietary concern would sell its immovable property and all pledged stock and proceeds thereof were to be adjusted against demand finance

Original security documents were still available with plaintiff-Bank

If it were intention of parties that any charge or guarantee was to get extinguished upon execution of finance or security documents with defendant-company, then all previous security documents would have been returned to guarantors

Guarantors would have demanded return of same if parties had agreed that liability of defendant-proprietary concern would come to an end upon execution of finance or security documents with defendant-company

Personal guarantees had provided that any change in constitution of customer-defendant-proprietary concern would not affect their liability towards plaintiff-Bank

Said guarantees had further provided that unless written notice was given by guarantor to Bank, guarantee would not be discharged, and that even if such notice was given, guarantor would, nevertheless, continue to remain liable

No such notice was available on record

Defendants had also executed identical personal guarantee, which provided that if defendant-company failed to meet its obligation towards plaintiff-Bank, then parties would be jointly and severally liable to meet those obligations

All mortgagors, guarantors and Directors were signatories to the agreement

Since agreements had been executed regarding rescheduled accounts, thus there was no question of such agreement being without consideration or disbursement

On breach of finance agreement, plaintiff-Bank had become entitled to recall or recover entire amount which had been granted to defendant-proprietary concern and which had fallen due.

Applicant/objector challenged the attachment and auction of the suit property in execution of the decree on the ground that the suit property was the ownership of her late father, and the defendant/judgment debtor, her mother, in connivance with the previous owner of the property, had got transferred the same in her name; therefore, the suit property was not liable to be attached and sold in execution of the decree; the Executing Court dismissed the objection petition

Validity

Suit property had been sold to the defendant/judgment debtor through a registered sale deed, on the basis of which the judgment debtor had obtained loan as guarantor and mortgagor

Registered document had sanctity attached to it, and stronger evidence was required to cast aspersion on its genuineness

Banking Court, after hearing the parties, had decreed the suit for recovery of the loan, against which no appeal had been filed; thus, the judgment and decree had attained finality

Suit property, in execution of the decree, had already been attached and then put into auction

Unregistered sale agreement was the only document on which the applicant/objector was relying

Ownership could not be claimed under said sale agreement, as the same did not confer any right, interest or title in suit property

Prior to the objections filed by the applicant/objector, her brother had also filed objections under O. XXI, R. 58, C.P.C. read with S. 19(7) of the Ordinance, which had also been dismissed by the Executing Court, and the order of dismissal, having not been challenged before any forum, had also attained finality; whereas, the applicant suppressed all said facts in present appeal

Applicant, her said brother and mother, appeared to be in collusion with each other to defeat the execution proceedings

Executing Court was not bound to hold regular inquiry by framing issues and providing opportunities to the parties to produce evidence; rather, the Court was vested with the power to reject objection summarily in absence of prima facie proof and also where the collusion was found between the objector and the judgment debtor

Impugned order was maintained

Appeal was dismissed in limine in circumstances.

Plaintiff Bank had clearly disclosed the details of the finances, re-payments made by the defendants and the amount outstanding against the defendants and also filed the relevant documents with the plaint; therefore, there was no default on the part of the Bank in complying with the requirement of S. 9 of Financial Institutions (Recovery of Finances) Ordinance, 2001

Defendant, on the other hand, had not complied with the mandatory requirements of Ss. 10(4) & 10(5) of the Ordinance

Defendants, in terms of S. 10(4) of the Ordinance, were required to disclose in their application for leave to defend, the amount of finance availed by them from the Bank; the amount paid by them to the Bank along with dates of payments; the amount of finance and other amount relating to the finance payable by them to the Bank up to the date of institution of the suit, and the amount, if any, which they had disputed as payable to the Bank, and the facts in support thereof

In terms of S. 10 (5) of the Ordinance, the defendants were required to file all such documents along with their application, which, in their opinion, supported the purported substantial questions of law and fact allegedly raised by them

Under S. 10(6) of the Ordinance, an application for leave to defend which did not comply with the requirements of Ss. 10(3), 10(4) and/or 10(5) of the Ordinance, would be rejected, unless the defendant disclosed therein the sufficient cause for his inability to comply with any such requirement

Defendant had neither complied with the said mandatory requirements nor had they disclosed any sufficient cause for their inability in complying with the same

Defendants had not filed any proof in support of their assertions that some repayments made by them had been suppressed by the Bank or that they were not liable to pay the amount claimed by the Bank

Defendants had categorically admitted to have availed the loan facilities and their liability towards the outstanding amount of the Bank had not been denied

Defendant would be deemed to have failed to make out a case for the grant of leave to defend, if he admitted availing of the finance facility and did not deny his liability to pay the same

Defendants had failed to raise any substantial question of law or fact; therefore, the Banking Court was justified in dismissing the application for leave to defend and decreeing the suit

Appeal was dismissed in circumstances.

Word "otherwise" used in S. 9 of Financial Institutions (Recovery of Finances) Ordinance, 2001 would also embrace within its ambit, apart from the power of attorney(s) any other documents including special power of attorney, authority letter etc. whereby a person who had verified the plaint could be authorized

If suit had been filed through a person having no authority then principal could ratify the defect if any later-on

Defendant had executed the documents for repayment of amount to the plaintiff-Bank

Guarantor was also liable to liquidate the outstanding dues owed to the plaintiff-Bank

Guarantor could not be permitted to avoid his liability

Every officer of the Bank who was responsible for recommending, approving and advancing finance facility was required to exercise due care and caution before sanctioning or providing any sort of such facility to the customer

Such officer was required to obtain sufficient security for securing the finance facilities

If an officer of Bank had omitted to take sufficient care in extending/advancing finance facilities then he had to suffer

Defendants/borrowers had failed to raise any substantial question of law and fact which might need recording of evidence

Defendants had availed finance facilities and they were bound to pay the outstanding amount

Suit of plaintiff-Bank was decreed to the extent of outstanding amount plus cost of funds till realization of decretal amount

Guarantor was also found liable in his capacity as a guarantor to the extent of guaranteed amount

Suit was also decreed for the sale of pledged/hypothecated goods if any with cost.

Contention of defendants was that Banking Court at the time of passing an 'interim decree' was required to grant not only 'leave to defend the suit' but also to frame issues

Validity

Disputed amount of mark-up could conveniently be sorted out without framing of any issue and recording of any evidence

Liquidated damages could not be granted without proving the same through sufficient evidence

Negotiable instrument had presumption of truth and any person who wished to dispel it had to furnish proof/cogent evidence to the contrary

Defendants with their free will and wish had signed and executed documents for repayment of loan amount

Defendants were estopped from challenging the same

Doctrine of promissory estoppel was applicable in the case

No one could approbate and reprobate at the same time

Party claiming liquidated damages had firstly to plead and then to lead positive and sufficient evidence in proof thereof

Issues would arise out of the pleadings of the parties

Issues could only be framed when dispute could not be resolved without putting the parties to lead evidence in 'pro' and 'contra' of the same

Issues were not required to be framed as a routine which would depend upon facts and circumstances of each case

Application for leave to defend the suit was dismissed and suit was decreed against the defendants jointly and severally for outstanding amount plus cost of funds from the date of default till the date of realization

Final decree with regard to sale of mortgaged properties was also passed.

Claim for losses/damages if any might be established only after framing of issues and recording of evidence in pro and contra thereof by the parties

Defendant had availed finance facility and he was also a guarantor in his personal capacity

Defendant was bound to pay the outstanding amount to the plaintiff Bank

Guarantor could not be allowed to avoid liability under the terms and conditions of guarantee

Liability of guarantor would be co-extensive with that of the principal debtor

Anything 'done' or 'promise' made for the benefit of 'principal debtor' was sufficient consideration for guarantor concerned

Creditor was only required to establish the liability of debtor and occurrence of the event of default

Fair trial and due process in banking matters was subject to leave to defend the suit

Defendant would not be entitled to defend the suit until leave to defend the same was obtained

Plea of fair trial and due process could not make redundant the provisions of Financial Institutions (Recovery of Finances) Ordinance, 2001

Rescheduling/ restructuring of finance could only be done at the request of customer

Outstanding amount was not needed to be disbursed again to the customer in rescheduling/restructuring the finance rather same had to be brought forward in the statement of account

Plaintiff Bank could claim purchase price/marked-up price under a new set of documents

Mark-up had been charged on the balance outstanding amount by the plaintiff Bank

Both the Financial Institution and customer were bound to fulfill their obligations

Mark-up mutually agreed between the parties on rescheduled amount was permissible

Entries made in the statement of accounts had presumption of correctness

If foreign currency finance was converted into local currency finance for repayment/payment then same had no consequence

Parties could vary and/or alter the terms of original contract on the basis of mutually agreed fresh terms and conditions

Documents of finance were valid and binding against the parties in the present case

Marked-up price/purchase price could not be enhanced or reduced unilaterally

Signing and execution of memoranda of deposit of title deeds was not a requirement of law

No question of redemption of mortgaged property could arise until entire outstanding amount was paid by the defendant

Defendant had failed to perform and fulfil his obligations towards plaintiff Bank

Plaintiff Bank was entitled to retain all the securities and recover it's up-to-date dues

Defendant could not put forward any sorts of adverse assertions in contravention of admitted fact and documents

Subordinate legislature could not override the provisions of Financial Institutions (Recovery of Finances) Ordinance, 2001

Defendant was not only liable to pay the agreed purchase price but also other accrued charges to the plaintiff Bank

Promissory notes had presumption of truth which could be dispelled with solid proof and sufficient evidence

Plaintiff Bank could not charge any mark-up beyond expiry period of finance agreement

If finance agreement did not mention/stipulate any expiry date then same would be treated only for one year/365 days

Mere filing a suit for damages by a customer did not ipso facto entitle him for grant of leave to defend the suit until and unless same was granted

Defendant had failed to fulfil the requirements for grant of leave to defend the suit

No substantial question of facts and law had been raised by the defendant

Application for grant of leave to defend the suit was rejected

Suit was decreed in circumstances with cost of fund w.e.f. April 01, 2009 till realization of the decretal amount

Decree for sale of mortgaged property was also passed.

Such rule was not applicable to the case when "death certificate" did not inspire confidence.

Legal heir of defendant-borrower filed application under S.12(2) read with S. 151, C.P.C. for setting aside ex parte judgment and decree on ground that present suit was not maintainable as defendant had died before filing of the suit

Banking Court dismissed the application

Validity

Banking Court had found that death certificate of the defendant was not genuine and same was an engineered document

Defendant had been served through all legal modes including publication, and no one, including the present applicant (legal heir of borrower) had come forward to defend the suit

Applicant had come forward with plea of non-service of court notices either upon defendant or his legal hers after a period about ten years from date of filing of present suit

No suit lay against dead person in the eyes of law, however, that plea was not applicable to the case, particularly when alleged death certificate did not inspire confidence

Applicant could not explain as to why he had filed application intimating death of borrower to Union Council after lapse of five years of (alleged) death when impugned judgment and decree was passed, and as to why the certificate had been obtained after lapse of about five years during execution proceedings

Applicant had not disputed amount of loan mentioned in the impugned judgment and decree

No useful purpose would be served if the judgment and decree were set aside at stage of execution proceedings, as legal heirs were required to pay outstanding liability of their deceased father

High Court allowed the applicant to file objection before executing court if he could produce conclusive documents to show date of death of defendant before passing of impugned judgment and decree

Appeal was dismissed accordingly.

Section 16 of Financial Institutions (Recovery of Finances) Ordinance, 2001 could not be looked into or applied in isolation in view of S. 23 of the said Ordinance

Section 23 of Financial Institutions (Recovery of Finances) Ordinance, 2001 provided that pending final decision of suit filed by financial institution in which summons under S. 9(5) of the Ordinance had been published, no customer would, without prior written permission of Banking Court, transfer, alienate, encumber, remove or part with possession of any of his asset or property furnished to financial institution as security by way of mortgage, pledge, hypothecation, charge, lien or otherwise

Any such transfer, alienation, encumbrance or other disposition by customer in violation of S. 23 of Financial Institutions (Recovery of Finances) Ordinance, 2001 would be void and of no legal effect

Banking Court, while deciding application under S. 16 of Financial Institutions (Recovery of Finances) Ordinance, 2001, must also keep in mind mandatory provisions of S. 23 of the Ordinance

Defendants were duty bound under S. 23 of Financial Institutions (Recovery of Finances) Ordinance, 2001 not to transfer, alienate, encumber, remove or part with possession of any of assets or properties furnished to plaintiff-Bank as security by way of hypothecation, without prior written permission of Banking Court

Parties were duty bound to ensure that hypothecated assets were not wasted or destroyed during pendency of suit in which the same were subject matter

Banking Court was supposed to enforce said duty of parties

Defendants had not disputed execution of any of the letters of hypothecation nor had they filed any counter affidavit or objections to oppose present application

Application was allowed in circumstances.

Banking court, while disposing of application filed by defendants with consent of both parties, directed plaintiff-Bank to honour its proposal contained in the consent order

Plaintiff-Bank filed application under S. 151, C.P.C. seeking correction of said consent order to the effect that annexure 'B' of the consent order was to be written instead of annexure 'C' in said consent order, which was allowed by Banking Court

Contention by defendants was that Banking Court was not competent to modify consent order, and that plaintiff-Bank had already accepted their proposal given in annexure 'C' of the order and same, therefore could not be replaced with annexure 'B'

Validity

Court had erroneously mentioned wrong annexure 'C' instead of annexure 'B'

Consent order was always open to correction if any error or omission was proved to have occurred to the satisfaction of the court

Defendants, as per their own request, had assured repayment of their liability in installments, and plaintiff-Bank, as shown from its hand written note on annexure 'B', had accepted such repayment schedule

Neither any acceptance from plaintiff-Bank in respect of annexure 'C' was available nor court could have lawfully directed plaintiff-Bank to act upon proposal as detailed in annexure 'C'

Order directing plaintiff-Bank to honour its proposal contained in annexure 'C', had been passed without proper assistance or even without going through the annexure 'C

Appeal was dismissed in circumstances.

Legal heirs of mortgagor filed present appeal seeking setting aside of judgment and decree to their extent on ground that their predecessor-in-interest, mortgagor, had deposited titled documents of suit property with principal debtor for obtaining loan from him, and principal debtor, unlawfully and without any authority, had mortgaged same property with plaintiff-Bank

Validity

Defendant-mortgagor had executed general power of attorney in favour of principal debtor empowering him to sell, transfer, gift or mortgage suit property

Power of attorney was duly registered

Principal debtor, on basis of said power of attorney, had mortgaged suit property with plaintiff-Bank for securing repayment of entire outstanding liability

Suit filed by mortgagor seeking permanent and mandatory injunction against principal debtor to restrain him from misusing or destroying title documents of suit property was sham, and same had never been seriously pursued nor redemption regarding suit property had been sought

Defendant-mortgagor, on becoming aware of mortgage of suit property with plaintiff-Bank on basis of said power of attorney, had also initiated contempt proceedings against principal debtor without impleading plaintiff-Bank

Defendant-mortgagor had never sought any declaration as to status of mortgage and title documents nor sought cancellation of said power of attorney

Said suit had been dismissed for non-prosecution during life time of defendant-mortgagor

Legal heirs of mortgagor, filed restoration application, which was also dismissed for non-prosecution

Defendant-mortgagor had filed application under O. VII, R. 11, C.P.C. in present suit, which was also dismissed for non-prosecution

Present suit was decreed after five months of dismissal of defendants' application, but defendants made no attempt either to file application for leave to defend suit or to get application under O. VII, R. 11, C.P.C. restored

No ground for interference with impugned judgment and decree was made out

High Court amended impugned judgment and decree limiting liability of defendant-mortgagor to the extent of maximum liability as fixed in mortgage documents

Appeal was disposed of in circumstances.

Defendant-guarantor had died before filing of present suit, thus, plaintiff-company impleaded legal heirs of deceased defendant

Banking Court, refusing leave to defend and decreed the suit

Validity

Trade name by itself had no legal status, as such same was neither partnership concern nor company incorporated

Proprietorship concern could not sue in trade name; however, in terms of O. XXX, R. 10, C.P.C., same could be sued in trade name

Proprietor of such trade name having expired much before filing of present suit, no further proceedings were valid against such trade name of defendant

Suit could proceed only through legal heirs of deceased defendant

Order XXII, R. 4, C.P.C. provided complete mechanism for bringing legal heirs of defendants on record

In the present case, as deceased was not sole defendant, as such suit could continue against other defendants validly, including legal heirs of deceased defendant if they were brought on record in accordance with law and with permission of court

Present case was not with regard to mortgage of property of deceased, but rather lease finance of assets

In case of mortgage of property, on default, legal heirs, on whom property would have devolved, could have been arrayed as defendants, as financial institution would have lien on mortgaged property

Leased assets did not devolve on legal heirs under law

As per contents of lease agreement, leased assets were to be registered in name of plaintiff-company

No question or issue as to devolving of leased assets to legal heir of borrower existed

Defendant was stated to have no right or interest in leased assets and that plaintiff-company might take possession of same, which were in use and control of defendant-guarantor; in such matters, once legal heirs had been brought on record, it was always appropriate to grant unconditional leave to defend

Legal heirs of deceased defendant having been brought on record, Banking Court was not justified in refusing grant of unconditional leave to defend to the legal heirs

Legal heirs should have been provided opportunity to defend and to bring all facts on record

Banking Court, thereafter, was to examine, as to whether valid decree could be passed and whether legal heirs had inherited any assets from deceased or not

Impugned judgment and decree against deceased defendant could not sustain

High Court, setting aside judgment and decree to the extent of deceased defendant, remanded case to Banking Court with direction to examine as to whether valid decree could be passed against legal heirs of deceased defendant

Appeal was partly allowed in circumstance.

Plaintiff, on defendant's failure to fully satisfy decretal amount as settled under compromise, filed second execution application

Defendant filed application seeking suspension of auction proceedings on ground that notice as required under O.XXI, R.66, C.P.C. had not been served upon him

Executing court, dismissed application filed under O.XXI, Rr.66 & 67, C.P.C., and confirmed auction sale of mortgaged suit property

Validity

Executing court had ordered proclamation of sale without issuance of notice under O.XXI, R.66, C.P.C., and, admittedly, no such notice had been served upon defendants by court for settling terms of auction sale

Provisions of O.XXI, R.66, C.P.C. were mandatory in nature, and non-compliance thereof in letter and spirit were fatal to sale proclamation

Non-issuance of notice under O.XXI, R.66, C.P.C. was material irregularity, which had vitiated whole auction proceedings

High Court, allowing present appeal, set aside impugned order of Banking Court and auction sale, directed Executing Court to put up suit property on re-auction after service of due notice upon defendant under O.XXI, R.66, C.P.C.

Appeal was allowed in circumstances.

Appeal was dismissed for non-prosecution on 30-3-2012 whereas application for re-admission of appeal has been filed on 19-5-2012

Limitation for re-admission of appeal was thirty days from the date of knowledge where notice was not duly served on the applicant

Applicant was duly served but neither he nor his counsel appeared before the court on the date fixed

Time-barred application for restoration of appeal was filed without any application for condonation of delay but subsequently prayer for condonation of delay in appeal was made through an application on the ground that applicant came to know about the dismissal of appeal on 24-4-2012

No evidence was produced with the application for condonation of delay that applicant came to know about the dismissal of appeal on the given date

Applicant was well aware of the date fixed but had deliberately avoided his appearance before the court

No sufficient case existed for condonation of delay

Indolent and non-cooperative attitude of the applicant towards the court had created a vested right in favour of respondent-bank which should not be dislocated

Limitation provided by the statute should be construed strictly in compliance with the maxim that "delay would defeat equity"

Each day's delay had to be explained by the party and in case of failure applicant should face the consequences

Court could not use its discretion in arbitrary way by abridging the provisions of limitation even if valuable rights of a person were involved in a case

Applicant had either gone into deep slumber or was deliberately avoiding his appearance before the court to delay the disposal of appeal

Application for restoration of appeal was dismissed in circumstances.

Any order of stay of execution of a decree should automatically lapse on the expiry of six months from the date of the order

Amount deposited in the court should be paid to the decree-holder after lapse of six months

Injunctive order passed on 10-4-2012 had lapsed by operation of law

Word 'shall' used in S. 22(7) of the Financial Institutions (Recovery of Finances) Ordinance, 2001 was mandatory in nature

Grant of injunctive relief would amount to circumvent the provisions of S. 22(7) of the Financial Institutions (Recovery of Finances) Ordinance, 2001

Application for grant of interim relief was dismissed in circumstances.

Plaintiff-Bank during execution proceedings filed application under S.19(3) of Financial Institutions (Recovery of Finances) Ordinance, 2001 seeking permission to auction mortgage properties without intervention of court, which was allowed

Defendant filed objection application under 0. XXI, R. 90, C.P.C. read with provisions of Financial Institutions (Recovery of Finances) Ordinance, 2001 raising objections as to conduct of said auction proceedings, which was dismissed by Banking Court

Contentions raised by defendant was that grave procedural irregularities had been committed during entire process of said auction and that no notice had been served upon him before auction proceedings

Plaintiff-Bank took plea that defendant, knowing about auction proceedings, had deliberately avoided the same

Validity

Section 19 of Financial Institutions (Recovery of Finances) Ordinance, 2001 granted options to decree holder that were either to choose for public auction or to invite sealed tenders for sale of mortgaged properties

In case decree holder opted for sale of mortgaged properties by inviting sealed tenders, notices thereof were required to be published in one English daily newspaper and one Urdu daily newspaper and thirty days time was to be given to prospective bidders for submitting offers

Section 19(3) of Financial Institutions (Recovery of Finances) Ordinance, 2001 conferred right upon decree holder Bank to proceed to auction mortgaged properties without intervention of Banking Court

Primary requirement for decree holder Bank was to seek permission from Banking Court which had been duly granted

Plaintiff-Bank, having obtained permission from Banking Court, proceeded for auction of properties properly by duly complying with provision of S. 19(3) & (4) of Financial Institutions (Recovery of Finances) Ordinance, 2001

Auctioneer was appointed by plaintiff-Bank who took steps to issue proclamation in widely circulated newspapers and also affixed posters at prominent places in order to give wide publicity to sale

Process prescribed under S. 19 of Financial Institutions (Recovery.. of Finances) Ordinance, 2001 was fully met with by plaintiff-Bank

Defendant in his objection petition had raised objections regarding non-observance of requirements of O. XXI, R. 66, C.P.C. which more properly pertained to auction of mortgaged properties by way of public auction

Objection raised by defendant, therefore, did not apply to auction through sealed tenders

Objection of defendant as to non-issuance of notice before auction proceedings was not sustainable for reasons that judgment and decree had specifically stated that suit was being converted into execution petition and date was fixed for filing Fard Taaliqa; that defendant had already filed appeal against judgment and decree, so he could not deny knowledge of pendency of execution proceedings; that report of auctioneer stated to have posted proclamation and posters to defendant but same were not received by him; postal receipts and notices received back were annexed with said report

Defendant had been appearing before Banking Court in execution proceedings, and it could be inferred that defendant had knowledge regarding permission granted to plaintiff-Bank for auction of mortgaged properties without intervention of court

Defendant had never objected to sale of mortgaged properties without intervention of court

Objection of defendant regarding inadequate 'gale price, being post-sale objection, had no merit

Sale price of mortgaged properties was more than their forced sale value

Plaintiff-Bank had fulfilled all procedural requirements for putting mortgaged properties to sale

Sale was well advertised, fair and transparent and competing bidders had participated therein

Objections of defendant were perfunctory and tentative in nature and same had no nexus with sale of mortgaged properties by way of invitation through sealed tenders

Banking Court had rightly rejected objection application filed by defendant

Appeal was dismissed in circumstances.

Banking Court passed an interim decree while deciding the application for leave to defend and granted conditional leave subject to furnishing bank guarantee

Defendants failed to submit bank guarantee and suit was finally decreed

Validity

Banking Court had power to pass an interim decree for an amount which was not disputed after consideration of pleadings and documents appended therewith

Banking Court had passed an interim decree for Rs. 12,398,584 and final decree was passed in the sum of Rs. 38,075,958

Both the said decrees were distinct and independent and were passed with regard to two separate amounts constituting the entire claim of plaintiff-bank in the suit

Final decree was not an adjudication on merits but same was passed due to default in submitting the bank guarantee

"Interim decree" had not merged into the "final decree" entitling the defendants to challenge the same

Principle of merger of decrees was limited to the situation where decree of lower court was modified or altered by the Appellate Court which would result in merger of decrees of lower court with that of the higher court

Matters dealt with by the interim decree were conclusive and final and were unalterable through any proceedings which were taken subsequently in the suit

Interim decree did not merge in the final decree and both the decrees retained their independent legal status in terms of filing of execution and appeals

Defendants had not challenged the interim decree in the present case

Basis for challenging the final decree was no longer available to the defendants

Final decree was passed merely for non-fulfilment of condition attached with to the grant of leave to defend the suit

High Court could not go behind the final decree and pass judgment on merits on interim decree which had not merged with the final decree and was not challenged in appeal

Banking Court had discretion to impose condition while adjudicating upon application for leave to defend

Banking Court had exercised such discretion by ordering for furnishing of bank guarantee as defence set up by the defendants in their application for leave to defend the suit was illusory and not bona fide

Defence of defendants was not with regard to the finance facilities or the amounts due thereunder, rather same was to set off the liability owned by them towards the plaintiff-bank with the pledged goods under the possession of the Bank

Defendants had not denied the liability and Banking Court imposed the condition of furnishing bank guarantee for grant of leave to defend the suit

Discretion for imposing condition on defendants was rightly exercised by the Banking Court

Banking Court had rightly passed final decree as defendants had failed to fulfil the condition attached to the grant of leave to defend the suit

Appeal was dismissed in circumstances.

Finance facility must have been availed by the customer and the dispute must have arisen between the customer and Financial Institution with regard to violation or breach of any obligation required to be performed or honoured by any of them

Relationship of customer and Financial Institution between the parties must be in existence for maintainability of suit before the Winking Court and there must have been a finance facility availed by the customer

Defendant had not led any evidence with regard to sustaining of losses

No error or illegality had been pointed out in the impugned judgment

Appeal was dismissed in circumstances.

Plaintiff, on defendant's failure to fully satisfy decretal amount as settled under compromise, filed second execution application-Defendant filed application seeking suspension of auction proceedings on ground that notice as required under O. XXI, R. 66, C.P.C. had not been served upon him

Executing court, dismissed application filed under O. XXI, Rr. 66 & 67, C.P.C., and confirmed auction sale of mortgaged suit property

Validity

Executing court had ordered proclamation of sale without issuance of notice under O. XXI, R. 66, C.P.C., and, admittedly, no such notice had been served upon defendants by court for settling terms of auction sale

Provisions of O.XXI, R. 66, C.P.C. were mandatory in nature, and non-compliance thereof in letter and spirit were fatal to sale proclamation-Non-issuance of notice under O. XXI, R. 66, C.P.C. was material irregularity, which had vitiated whole auction proceedings

High Court, allowing present appeal, set aside impugned order of Banking Court and auction sale, directed Executing court to put up suit property on re-auction after service of due notice upon defendant under O. XXI, R. 66, C.P.C.

Appeal was allowed in circumstances.

Limitation period would start from the date of announcement of order and not from the knowledge of the same whether copy of such order was ready or not

Limitation would not depend on the fate of order whether same was in favour of appellant or not

Period consumed in preparation of certified copy could only be condoned in favour of a party provided application for issuance of such copy was made in time

Limitation for filing appeal under S. 22 of Financial Institutions (Recovery of Finances) Ordinance, 2001 was thirty days from the date of order

Present appeal was barred by time

Powers vested in the court to condone period of limitation in terms of S.5 of Limitation Act, 1908 were discretionary in nature

Court must be satisfied that delay in filing of appeal was beyond the control of a party for exercise of such discretion and was not contumacious

Defendant had not made out a prima facie case to exercise such discretion in its favour to condone the delay in filing of present appeal

Once time had begun to run it did not stop, and delay of each and every day had to be explained

Defendant had failed to explain the delay of each and every day

Defendant was required to show sufficient cause but no such cause had been shown to condone delay in filing of appeal

Appeal was dismissed as barred by time.