Sheikh MUHAMMAD KASHIF ZIA and anothers vs BANK OF PUNJAB through Constituted Attorney and another
This matter concerns an appeal against a judgment and decree passed by a Banking Court in a recovery suit filed by the respondent-Bank against the appellants. The appellants had sought leave to appear and defend the suit, which the trial court rejected, leading to a decree against them. The core legal question was whether the appellants were entitled to leave to defend based on their specific assertion that Rs. 1,65,000 was withdrawn from their account through an unauthorized, bogus cheque, a claim to which the respondent-Bank provided only an evasive denial in its reply. The Lahore High Court held that the respondent-Bank's failure to specifically deny this material allegation in the pleadings entitled the appellants to leave to defend regarding that specific amount. Consequently, the Court modified the decree, upholding it for the undisputed balance while setting it aside regarding the disputed Rs. 1,65,000. The case was remanded to the Banking Court for trial specifically on the issue of the unauthorized withdrawal. The judgment establishes that evasive denials in pleadings regarding material facts in recovery suits warrant the granting of leave to defend.
- Does an evasive denial by a plaintiff in response to an application for leave to defend entitle a defendant to such leave?
- Can a court partially set aside a decree in a recovery suit while remanding a specific disputed amount for trial?
- Is a defendant entitled to leave to defend when a specific allegation of unauthorized withdrawal of funds remains unaddressed by the plaintiff?
ORDER
' The respondent-Bank brought a suit for recovery of an amount of Rs.358,388 against the appellants. The appellants brought an application for leave to appear and defend the suit which application has been rejected by the Court below through the impugned order and the decree has been passed in terms of the suit. Learned counsel appearing on behalf of learned counsel for the appellants, states that a specific assertion has been made in the application that an amount of Rs.1,65,000 from the account of the appellants in Pak Block Branch, Allama Iqbal Town, Lahore, of the respondent-Bank, has been withdrawn through bogus cheque and there is no authorization in that behalf. In reply to the relevant paragraphs no specific denial has been made by the respondent-Bank and evasively all the paragraphs and preliminary objections Nos.1 to 25 have been denied. Resultantly, on the basis of the quality of the pleadings, particularly, no denial in reply to the application, was made, to the extent of Rs.1,65,000, the appellant was entitled to grant leave.
2. After having heard learned counsel for the parties, we are of the view that as the respondent- Bank has evasively denied the assertion made by the appellants in the application for leave to defend with regard to the unauthorized withdrawal of the amount of Rs.1,65,000 notwithstanding if this amount has been withdrawn from another account or from another branch, it is the respondent-Bank whic1- is the key respondent in the matter, therefore, to this extent the appellants were entitled to grant leave.
3. Resultantly, we modify the judgment and decree; by upholding the decree to the extent of the balance amount except Rs.1,65,000, the same is set aside, the appellant is granted leave qua his grievance of Rs.1,65,000. The matter is remanded to the Banking Court for the trial of the issue as raised by the appellant for the amount of Rs.1,65,000. Disposed of accordingly.