CHAUDHRY AUTOMOBILE AUTO STORE AND OTHERS vs UNITED BANK LTD.
This petition arises from a suit filed by the respondent, United Bank Limited, against the petitioners for the recovery of a loan under the Banking Companies (Recovery of Loans) Ordinance 1979. The petitioners sought leave to defend, claiming the liability was discharged, but failed to produce supporting receipts. The trial court granted conditional leave to defend, requiring a cash deposit of the suit amount, which the petitioners failed to fulfill, resulting in a decree against them. The High Court dismissed their appeal in limine. Before the Supreme Court, the petitioners challenged the Special Court's jurisdiction, arguing the claim amount was below the threshold for its cognizance. The Court held that the amending Ordinance II of 1983, effective prior to the suit's institution, extended the Special Court's jurisdiction to loans up to one million rupees without a minimum limit, thereby validating the trial court's jurisdiction. Furthermore, the Court affirmed that the imposition of conditions for granting leave to defend falls within the trial court's discretion, finding no illegality in the exercise of such discretion. The petition was dismissed.
- Does the Special Court have jurisdiction to try a suit for a loan recovery amount below one lac rupees under the Banking Companies (Recovery of Loans) Ordinance 1979 as amended by Ordinance II of 1983?
- Is the imposition of a condition to deposit the suit amount for granting leave to defend within the discretion of the trial court?
- Does the amendment to the Banking Companies (Recovery of Loans) Ordinance 1979 via Ordinance II of 1983 establish a minimum limit for the jurisdiction of the Special Court?
- Banking Companies (Recovery of Loans) Ordinance 1979
- Ordinance II of 1983
ORDER
' M. S. H. QURAISHI, 3-This petition arises from a suit brought on 19-6-1983 by the respondent, i. e., United Bank Limited, under the Banking Companies (Recovery of Loans) Ordinance (XIX of 1979) against the petitioners for recovery of Rs, 57,219.40 being the loan advanced on the basis of a promissory note. The petitioners sought leave to defend asserting that they had paid off the entire liability. They produced no receipt in support of the discharge of such liability but the trial Court in order to enable them "to elaborate their point in the Court" allowed them leave to defend the suit conditionally upon their depositing the suit amount in cash in Court by 22-9-1983. The order of deposit not having been complied with, the suit was decreed on 25-9-1983. The petitioners' - First Appeal before the High Court having been dismissed in limine, they have sought leave to appeal.
2. The main contention raised is as to the jurisdiction of the Special Court. It is urged that the suit for claim for an amount below rupees one lac is not triable by that Court. This was controverted by learned counsel for the Bank by reference to the amending Ordinance II of 1983 notified in the Gazette on and effective from 30-1-1983, which being a date prior to the institution of the suit it was applicable to the case. By the amendment, the jurisdiction of the Special Court was extended to cover outstanding amount of loan not exceeding one million rupees. There being no minimum limit, the suit was within jurisdiction of the Special Court. As regards the severity of the condition imposed by the trial Court in granting leave to defend, the matter falls within the discretion of that Court and considering the circumstance of the case, we are satisfied that no illegality in the exercise of such discretion has been committed. No case is made out for interference. The petition is, therefore, dismissed.