Messrs LIAQAT FLOUR AND GENERAL MILLS through Partners and 3 others vs Messrs MUSLIM COMMERCIAL BANK LTD

MIAN SAQIB NISAR, J.---On 30-5-2000, the respondent-Bank, brought a suit for the recovery of an amount of Rs.16,24,409,69, against the appellants/defendants, before the Banking Court at Gujranwala. The appellant/defendant No.1 is the Firm and the mortgagor for the said finance, whereas, appellants/defendants Nos. 2 to 4, are the partners thereof; all the defendants filed the leave application under the provisions of Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997; however, on the enforcement of the Financial Institutions (Recovery of Finances), Ordinance, 2001, they were obliged to file a new application, which was only filed by defendant No.2, who is the Managing Partner of the Firm, whereas, learned counsel for defendants Nos.1 to 3, filed memo. Of appearance on behalf of the said defendants, and also filed power of attorney on behalf of defendant No.4 but did not submit the fresh leave application on behalf of defendants Nos.3 and 4; the amended leave application on behalf of defendant No.2, was submitted by Ch. Farrukh Mehmood Sulehria, Advocate, who subsequently withdrew his power of attorney, as his name was placed on the penal of the bank/MCB. Learned counsel who has appeared on behalf of defendant No 2, could not submit his power of attorney, even after the lapse of 5-1/2 months, after submission of memo. Of appearance, thus the learned Banking Judge, vide order/judgment and decree. Dated 3-9-2002, by dismissing the leave application of defendant No.2 and proceeding ex parte against defendants Nos. 1, 3 and 4, passed a decree to the tune of Rs.14,50,387 against the defendants, with costs and has also granted the cost of fund as certified by the State Bank of Pakistan from time to time from the date of default i.e. 1-7-2000 till full payment except liquidated damages, jointly and severally.

2. Learned counsel for the appellants, argued that even if there is any lapse in filing the leave application under the Ordinance, 2001, yet the leave application, earlier filed by the defendants under Act, 1997, should have been taken into account and the matter should have been decided on the basis thereof; besides, on the reading of the plaint, considering it along with the documents attached thereto, it stands established that the bank's case did not coincide with such appended documents, particularly, the sanction advice, which was only for the finance regarding a restricted period, and also the finance agreements and DP Notes, which were all in blank; even the complete bank statement was not filed along with the plaint and it was on the objection of the appellants, that the complete bank statement was filed. It is further submitted that the appellants have already made the repayment of the entire amount of the finance availed by them and the receipts in this behalf, were also placed on the record, but those have not been taken into consideration by the learned Banking Court.

3. Heard. Learned counsel for the respondent-Bank admits that DP Notes and the agreements of finance, are blank; most of them, are even without date; it has also been observed by the Court that in the plaint, the respondent-Bank has not set out a case regarding the running finance on the basis of such agreements, etc. But from the statement of accounts, it seems to be a case of running finance; the plaint was not initially supported by the complete statement of accounts.

These are some of the anomalies and the deficiencies, which floats on the face of the plaintiffs case and should have been considered by the Court below, while passing the decree; thus irrespective of the fact that there was no leave application on behalf of the appellants, and if filed the same had been dismissed, the decree should not have been passed by the Court, in a mechanical manner, specially for the omission of the plaintiff to support its claim by filing the complete statements of account., along with the suit; this was very material and crucial aspect of the case, but the Court has not even adverted to the same. In the circumstances, the appellants after the filing of the complete statement of account, by the respondent-Bank, under the new Law, were entitled to an opportunity given to them expressly by the Court to file an amended leave application. But from the record, it transpires that it was not so done. For all what has been stated above, the impugned judgment and decree cannot sustain and we are also of the view that in the circumstances of the case, the appellants should be allowed to file a fresh leave application, which should be moved within a period of ten days from today without fail; the Court shall consider such leave application afresh without being prejudiced on account of any observation made in this judgment. As the judgment has been dictated in the Court, the time spent by the appellants for procuring the copy of this decision, shall not be excluded from 10 days. If the leave application is not filed within the given time, this appeal shall be deemed to have been dismissed. In the light of the above, the impugned judgment is hereby set aside. The parties are directed to appear before the Court on 10-11-2006 and the Court shall decide the matter within a period of three months from that date. This appeal is accordingly allowed.