ALAUDDIN KHAN Versus MANAGER, FAYSAL BANK, PVT. LTD. MATTA SWAT

QAZI JAWAD EHSANULLAH, J.--- Appellant Alauddin Khan has filed this particular appeal under the provisions of Section 17 of the Khyber Pakhtunkhwa Consumer Protection Act, 1997 ("Act") , challenging the order dated 06.02.2023 passed by the learned Consumer Court (at Swat), whereby his complaint filed under section l3 of the Act ibid was ordered to be dismissed on the ground of lack of jurisdiction, holding that the matter fell within the exclusive domain of the Banking Court under the provisions of Section 7(4) of the Financial Institutions (Recovery of Finances) Ordinance, 2001 ("Ordinance 2001") .

2. In brief, the facts giving rise to the instant appeal are that the appellant is the customer of the respondents / Bank and has maintained a US Dollar account with it; that on 01.08.2022 an amount of 92000$ were deposited in the said account; that after that when he has requested the respondents / Bank for its withdrawal in US Dollars, the latter has declined and instead offered to release the amount in Pakistani Rupees (PKR) and that later on, the Bank has transferred the aforesaid amount in PKR to his another account maintained by him in the said Bank. Aggrieved by this conduct of the Bank, the appellant has filed a complaint before the learned Consumer Court under the provisions of Section 13 of the Act.

3. In response, the respondents / Bank has contested this particular complaint by raising various legal and factual objections. They have also raised an objection with regard to jurisdiction of the Consumer Court, by referring to Section 7(4) of the Ordinance 2001 and requested for outright dismissal of the complaint as aforesaid. After receipt of the pleadings, the learned Consumer Court has heard and decided the complaint vide the impugned order dated 06.02.2023, by holding as follows;

"6. Under Section 7 (4) of the Financial Institutions (Recovery of Finances) Ordinance 2001, no court other than a Banking Court shall have or exercise any jurisdiction with respect to any matter to which the jurisdiction of Banking Court extends under this Ordinance, including its decisions as to the existence or otherwise of the finance and the execution of a decree passed a Banking Court. In the instant case, admittedly the complainant is the customer of the respondents and he is running two accounts with the respondents in PKR and foreign currency account. Hence, it can be safely held that matter in question is in between the customer and the bank which is a financial institution and this matter falls exclusively under the jurisdiction of Banking Court as provided in section 7 (4) of Financial Institutions (Recovery of Finances) Ordinance, 2001. It is also admitted that Khyber Pakhtunkhwa, Consumer Protection Act is a provincial statute and the ibid Ordinance is a Federal Statute and under Article 143 of the Constitution of Pakistan, the federal statute will prevail over the provincial statute. Under section 3 of the Khyber Pakhtunkhwa, Consumer Protection Act 1997, the provision of this Act shall be in addition to and not in derogation or supersession of any other law for the time being in force. So when the provision of Khyber Pakhtunkhwa, Consumer Protection Act and the Financial Institutions (Recovery of Finances) Ordinance, 2001 are read in juxtaposition, there remains no doubt about it that Consumer Court has got no jurisdiction to deal with the matter in hand.

7. The nut shell of above discussion is that without discussing the merits of the case, it is hereby held that this Court has got no jurisdiction to adjudicate upon the matter in hand and the instant complaint stands dismissed due to lack of jurisdiction. However, the complainant is at liberty to approach the Banking Court for redressal of his grievances. As the complainant has filed this complaint before the wrong forum, so the time consumed before this Court shall be condoned from any suit or application which the complainant may desire to file before the Banking Court within a reasonable time frame."

Now the appellant has challenged this particular order before this court by way of filing the instant appeal. As no one has put his appearance on behalf of the respondents / Bank despite being served, so they are proceeded against ex parte . Since a short point is involved, therefore this court is left with no other option but to decide the case on its own merits and after hearing arguments of learned counsel for the appellant.

4. The core issue before this court is whether the Consumer Court had the jurisdiction to adjudicate upon the grievance of petitioner concerning refusal of the Bank to allow him withdrawal of the amount in US Dollars or otherwise? In order to answer this particular jurisdictional issue, a comparative reading of both the statutes (the Act and Ordinance of 2001) is necessary. The Consumer Court enjoys the jurisdiction under the provisions of Section 13 of the Act, which for the facility of reference is reproduced below;

"13. Manner in which complaint shall be made.--- (1) A complaint, in relation to any goods sold or delivered or any service provided, may be filed with the Court by-

(a) the consumer to whom such goods are sold or delivered or such service is provided;

(b) Deleted.

(c) any recognized consumers association irrespective of the fact that the consumer to whom the goods are sold or delivered or service is provided is or is not a member of such association; or

(d) by the Director or any officer of the Directorate authorized by him in this behalf

Explanation.---For the purpose of this section "recognized consumer association" means any voluntary consumer association registered under the Companies Ordinance 1984 (XLVII of 1984) or the Societies Registration Act, 1860 (XXI of 1860) or the Voluntary Welfare Agencies (Registration and Control) Act, 1961 or any other law for the time being in force and Consumer Cooperative Societies registered under the Cooperative Societies Act, 1925 or such other association as may be prescribed.

(2) A complaint under this section shall be submitted within ten days of the sale, delivery or rendering of the service:

Provided that the Court having jurisdiction to hear the complaint may allow a complaint to be filed after ten days and within such time as it may allow if it is satisfied that there was sufficient cause for not filing the same within the specified period:

Provided further that such extension shall not be allowed beyond a period or sixty days from the expiry of the warranty or guarantee period specified by the manufacturer of the goods or seller of the services and if no such period is specified, one year of the date of purchase of the goods or providing of services."

Section 2(n) of the Act defines "services" in the following terms;

"Services" includes services of any description which are made available to potential users and includes the provision of facilities in connection with banking, financing, insurance, transport, manufacturing, processing, accountancy, supply of electrical, mechanical or any other form of energy including gas and petrol, water, telephone, boarding or lodging, entertainment, medicine, education, construction work, amusement, catering, security, or purveying news or other information and similar other services, but does not include the rendering of any service free of charge or under the contract of personal services."

A plain and literal interpretation of the term 'services' unequivocally brings banking services within the ambit of the Act. In this very context, it would be relevant to mention here that the stated conduct of a Bank in refusing to allow withdrawal in the designated currency of the account, without statutory prohibition or regulatory embargo, may amount to a deficiency in service and the Act provides a remedy to a consumer against unfair trade practices and deficiency in services. Where a banking service is rendered in a manner inconsistent with the standard reasonably expected of a financial institution, the Consumer Court can validly assume the jurisdiction.

5. As against that, Section 9 (1) of the Ordinance 2001 provides for procedure of the Banking Courts. For the sake of reference, ibid Section is reproduced as under;

"9. Procedure of Banking Courts. -(1) Where a customer or a financial institution commits a default in fulfillment of any obligation with regard to any finance, the financial institution or, as the case may be, the customer, may institute a suit in the Banking Court by presenting a plaint which shall be verified on oath, in the case of a financial institution by the Branch Manager or such other officer of the financial institution as may be duly authorized in this behalf by power of attorney or otherwise."

From the afore-quoted section of law, it is very much clear that if either a ' customer ' or a ' financial institution ' (a bank) fails to meet their obligations with regard to any ' finance ', then either party has the right to file a plaint in a Banking Court. The term " finance " has been defined in Section 2(d) of the Ordinance 2001 which primarily refers to lending, leasing, guarantees, and similar financial arrangements by Banks and financial institutions. It is as evident from its definition that the Ordinance ibid is mainly aimed to deal with disputes concerning recovery of credit, loans, and in relation thereto defaults in financial obligations. However, in the present case, no such element of loan, default, or recovery is involved, but the grievance of appellant arises from the Bank's refusal to allow withdrawal in the currency in which the deposit was made which does not fall within the scope of "finance" as defined in Ordinance of 2001. So, the alleged refusal by the Bank pertains to a transactional service issue concerning the operation of a foreign currency account. it does not involve any aspect of financial default or recovery, nor does it fall within the mischief of Section 9 of the Ordinance as aforesaid.

6. Thus, in view of inclusion of banking services within the definition of "services" under Section 2(n) of the Act, and in absence of any overriding provision barring the jurisdiction of the Consumer Court in such service-related matters, it is held that the Consumer Court is having jurisdiction to entertain the appellant's complaint. But it has erroneously dismissed the complaint for lack of jurisdiction, which approach is based on misconstruction of relevant provisions of law.

7. Foregoing in view, the appeal in hand succeeds and is allowed. Consequently, the impugned order dated 06.02.2023 passed by the learned Consumer Court is set-aside. The complaint so filed by the appellant is restored and shall be deemed pending before the learned Consumer Court for its adjudication on merits in accordance with law. It is expected that the learned Consumer Court shall proceed with the matter as expeditiously as possible but not later than 90 days from receipt of this judgment.

JK/126/P Appeal allowed.