LAL MUHAMMAD ALLIED BANK OF PAKISTAN LTD Versus ALLIED BANKOF PAKISTAN LTD

In both the following Regular First Appeals Nos. 6 of 1983 and 7 of 1983, since a common point of law is involved, 1 intend to dispose them of by this single judgment.

2. Allied Bank of Pakistan Limited, through the Manager, Shahrah‑i?Hazara Branch, Haripur (hereinafter referred to as the respondent Bank) filed two suits in the Court of District Judge, Abbottabad, as per the respective plaints dated 7th November, 1982, under Order 37, C.P.C. for the recovery of a sum of Rs.18,301.24 as a debt balance against Lal Mohammed defendant‑appellant herein and for a sum of Rs.16,832.00 as a debt balance against Faqir Mohammad defendant‑appellant herein respectively.

3. Notices were issued to .the defendant‑appellants the same day i.e. 7th November, 1982 for appearance on 20th December, 1982. On this date while the Bank was represented by their counsel, the appellants appeared in the respective suits in person and the case was adjourned to 16th March, 1983 as per order sheet of the learned District Judge, Abbottabad, "for arguments on the claim as a whole because the application for permission to defend was not moved within prescribed period. Meanwhile the amount as prayed for be attached. Warrant of attachment be issued ? ". It appears that on the date fixed i.e. 16th March, 1983 again while the learned counsel for the Rank and a representative of the Collector were present, the appellant Lal Mohammad was present but appellant Faqir Mohammad was absent. However, the learned District Judge decreed both the suits with interest at the rate of 14% till the date of payment against both the appellants respectively as per detailed judgment of the even date. Hence both the aforesaid appeals.

4. I have heard Bashir Ahmad, Advocate learned counsel for the appellants and Rashidul Haq Qazi, Advocate learned counsel for the respondent Bank at length and also perused the record of the case with considerable degree of care.

5. It is contended on behalf of both the appellants that the service of the appellants is not proper inasmuch as the provisions of Order 37 C.P.C. have not been complied with in that the mandatory procedure laid down under Rule 2 (1) (ibid) has not been followed in the matters of issuing summons against the appellants in the prescribed Form IV in Appendix `B' thereof. The learned counsel for the appellants, therefore, maintained that the impugned judgments and decrees granted by the learned District Judge, suffering from an incurable infirmity, cannot be sustained and are liable to be set aside.

6. On the other hand the learned counsel for the respondent Bank stated that although notices issued by the learned District Judge were not in conformity with the provisions as contained in Rule 2(1) of Order 37, P.P.C., yet this omission cannot prove fatal to the suits filed by the Bank. He rather urged that the appeals are not maintainable on the ground that under Rule 4 Order 37 read with section 96(1), C.P.C. the appellants should have moved the Court granting the decree for setting it aside and the Court might have given leave to appear to have defended the suits, if it seemed reasonable to the Court so to do.

7. I have given my serious consideration to the submissions made by learned counsel for the parties in support of their respective pleas.

8. A perusal of the record, with particular reference to the order sheet of both the suits, reveals that on 7th November, 1982 two suits were instituted by the respondent Bank under Order 37, C.P.C. alongwith application for the attachment of the property under Order 37, Rule 5, C.P.C. which were entertained the same day and the learned trial Judge passed the following order:

"Notice to defendants under registered cover A/D be issued for 20 th December, 1982. Registered A/D within 3 days. Notice of application be issued to defendants for the date fixed:'

9. Pursuant to the above order of the Court, notices were issued to the appellants which are written in hand and are to the following effect:

On 20th December, 1982, it seems that, both the appellants in their respective suits, appeared in person and the learned trial Judge adjourned the case to 16th March, 1983 to hear "arguments on the claim as a whole because the application for permission to defend was not moved within prescribed period" and on the next hearing i.e. 16th March, 1983 he decreed the suits as per his impugned judgments.

10. Correspondingly, a reference to rule 2(l) of Order 37, C.P.C. as also the Proforma of summons in Form IV in Appendix `B' may be usefully made:

"Order XXXVII, R.2(1)‑‑ All suits upon bills of exchange, hundis or promissory notes, may, in case the plaintiff desires to proceed hereunder, be instituted by presenting a plaint in the form prescribed; but the summons shall be in Form No.4 in Appendix B or in such other form as may be from time to time prescribed."

Summons in summary suit on negotiable instrument (O 37 R 2) (Title)

To ??????? (Name, description and place of residence)

WHEREAS ??????.has instituted a suit against you under Order XXXVII of the Code of Civil Procedure, 1908 for Rs?????..balance of principle and interest due to him as the????.of a?????.of which a copy is hereto annexed, you are hereby summoned to obtain leave from the Court within ten days from the service hereof to appear and defend the suit, and within such time to cause an appearance to be entered for you. In default whereof the plaintiff will be entitled at any time after the expiration of such 10 days to obtain a decree for any sum not exceeding the sum of Rs???..and the sum of Rs ???????.for costs (together with such interest, if any, from the date of institution of the suit as the Court may order.

Leave to appear may be obtained on an application to the Court supported by affidavit or declaration showing that there is a defence to the suit on the merits, or that it is reasonable that you should be allowed to appear in the suit.

??????????? GIVEN under my hand and seal of the Court, this????.day??.of???.19?.

JUDGE.

11. A bare reading of the aforequoted provisions of law would indicate that whereas, in instituting a suit under Order 37 CPC, a plaintiff has a discretion to do so by presenting a plaint in the Form prescribed as per rule 2 (1) (ibid) or in accordance with Rule 3 of Order 6 CPC in an approximating Form No.IV of Appendix `A' (ibid), but, in matters of issuing summons to the defendants, in Form No.IV in Appendix `B' or in such other form as from time to time prescribed, the provision appears to be rather imperative inasmuch as contrary to the use of word `may' in the Form of plaint, the word "shall" is mentioned so far as concerns the Form prescribed for the summons.

12. It will be pertinent to observe here that the statutory Form of summons, specifically prescribed in the law itself, is not without an object or purpose particularly with reference to the fact that the proceedings under Order 37 CPC are summary in nature. It may thus be borne in mind that under Order 37 Rule 2(1) the defendant is not entitled to appear and defend the suit unless he had obtained the leave within 10 days of the service of the summons. With these fetters placed on the right of the defendant; it would only be fair and just to ensure that not only the summons issued are strictly in accordance with what is prescribed in law but also that on the day when it is served on the defendant, he would be fully aware of the plaintiffs claim in the suit. For, the main aim behind prescribing the Form of summons is that, in a suit under Order 37, C.P.C., while the defendant be acquainted with the nature of claim, he may also be warned of the limitation imposed upon his right of defence and the period within which he is required to move an application for leave to appear and defend the suit. I have, therefore, no hesitation in holding that in case of failure to issue summons strictly in the statutory Form No.IV in Appendix `B' or such other form as prescribed vide Order 37 Rule 2(1), C.P.C., the service of defendant in a suit under Order 37 C.P.C. shall not be deemed as having been effected in accordance with law and all ensuing proceedings thereto will neither be proper nor legal.

13. In this context of the matter, the contention of the learned counsel for the respondent Bank about the competency of the appellants hardly sounds valid for a simple and short reason that the very proceedings culminated in granting the impugned decrees were against, and violative, of Rule 2 (1) of Order 37 CPC and as such nullity in the eyes of law. Otherwise too Rule 4 of Order 37 CPC envisages power for the Court to set aside an ex parte decree and not the one as granted in the instant suits. The contention of the learned counsel for the respondent Bank, therefore, has no force and is repelled accordingly.

14. Reverting back to the factual aspect of the case, from the very orders of the learned District Judge as also the operative part of the notice reproduced above, it is apparent that even if the same are presumed to be summons within the meaning of Order 37, Rule 2(1), C.P.C., it is apparent that the summons issued to the appellants were not in conformity with the imperative requirements thereof. Consequently it is very much obvious that neither complete information about the claim of the respondent Bank was conveyed to, or brought in the knowledge of, the appellants nor did it mention the requisite warning to the appellants relating to the limitation imposed on their right of defence or the period of 10 days prescribed therefor. On the other hand, on their first appearance on 20th December, 1982, as is evident from the order of that date, it was presumed by the Court that the appellants had failed to move an application in this behalf and without affording them an opportunity of effectively participating in the proceedings, the case was next fixed for arguments and on that very date the judgment was passed by decreeing the suits against them.

15. Such being the situation, I am clear in my mind that the so‑called summons issued to the appellants being violative of, and not in conformity with, Rule 2 (1) of Order 37 CPC; all the subsequent proceedings entailing thereto and eventually ending in granting the decrees vide the impugned judgments of the learned District Judge, cannot be sustained in law and I hold it accordingly.

16. Result is that I allow both these appeals, set aside the impugned judgments and decrees dated 16th March, 1983 of District Judge, Abbottabad, passed in both the suits and remand the same to Special Court Peshawar set up under section 5 of the Banking Companies (Recovery of Loans) Ordinance, 1979 for proceeding in the suits, from the stage, as if the plaint was presented to him afresh, in accordance with law and decide the matter as expeditiously as possible.

M.B.A./955/P ????????????????????????????????????????????????????????????????????????????????????????????????????????????? Appeals allowed.