HABIB BANK LIMITED vs Messrs THE ENGLISH ENGINEERING COMPANY and 2

' MIAN SAQIB NISAR, J.---The appellant brought a suit for the recovery against the respondents on the basis of IDA Credit Loan Facility, to the tune of Rs.3,00,000 granted to the respondents by the bank. The respondents filed the leave application, but without deciding the same, the learned Banking Court has rejected the plaint of the appellant under the provisions of Order VII, rule 11, C.P.C., through the impugned order dated 30-7-1999 holding that:-- "Since the plaint is not supported by an agreement it is silent on the factum of repayment by the defendant although orally admitted by the learned counsel for the plaintiff, the plaint does not disclose a cause of action and the suit is not maintainable. The plaint is therefore, rejected under Order VII, rule 11."

' Hence this appeal.

2. The learned counsel for the appellant by referring to various paragraphs of the plaint, particularly paragraphs Nos.5 to 7 states that, the plaintiff/appellant therein has specifically averred about the grant of the financial facility to the respondents on their request, which was duly approved and in consideration, certain documents were also executed by the defendants; therefore, even if no written agreement, envisaging the loan was executed by the parties or even not filed by the appellant, such omission could not have been considered as a ground for the non-disclosure of the cause of action in the plaint.

3. We have heard the learned counsel for the parties and find that, the averments of the plaint, which should be deemed correct while considering, if it discloses cause of action or otherwise, disclosed the cause of action and only for the reason that, there is no written agreement of finance between the parties, the plaint could not have been rejected. Even otherwise, from the perusal of the leave application, it is not disputed by the respondents that the finance facility was not granted to the respondent, rather the only ground taken is "That there is no written agreement between the plaintiff-Bank and the defendants regarding the rate of mark-up." It is only with regard to mark-up, that the question of written agreement was raised and not about the availing of the finance. In such situation, the Court below has erroneously applied the provisions of Order VII, rule 11, C.P.C., which order cannot be sustained. Resultantly, the same is set aside and the matter is remanded to the Banking Court, where the application of the respondents for leave to appear and defend shall be deemed pending and the matter shall be decided afresh in accordance with law. This appeal is accordingly allowed.