Mian MUHAMMAD SHAFI vs MUSLIM COMMERCIAL BANK LTD., LYALLPUR
This matter concerns a petition for leave to appeal against a High Court judgment that reversed concurrent findings of lower courts regarding the release of goods held by a bank. The petitioner, a proprietor of a manufacturing firm, imported edible oil through a bank, which acted as a facilitator. After the petitioner paid the bank for the oil, the bank refused to release the goods, claiming a general lien based on guarantees it had provided on the petitioner's behalf. The trial court and the appellate court initially granted a temporary injunction for the release of the oil, but the High Court set aside these orders, upholding the bank's claim of a general lien. The Supreme Court granted leave to appeal, noting the petitioner's contention that a bank cannot assert a general lien over goods when it has merely acted as a guarantor without depositing funds to the petitioner's credit. Furthermore, the Court expressed concern that the High Court had effectively decided the entire suit in revision, potentially prejudicing the petitioner's case. The Supreme Court directed the trial court to proceed with the suit but prohibited the announcement of a final judgment pending the appeal's outcome.
- Can a bank assert a general lien over goods held on behalf of a client when the bank has only acted as a guarantor without depositing funds to the client's credit?
- Does a High Court have the jurisdiction to decide the entire merits of a suit while exercising revisional jurisdiction against an interlocutory order?
ORDER
1. WAHEEDUDDIN AHMAD, J.-The petitioner is the sole pro--prietor of Messrs Sargroh Vegetable Ghee and General Mills, Lyallpur, which is engaged in the manufacture of Vanaspati Ghee. In connection with this business, the petitioner imports edible oil from abroad through the Association of Vanaspati Ghee Manufacturers. The Government of Pakistan issued some aid licenses to the Association for the import of soyabeen oil under PL-40, for the benefit of its members in accordance with their quota. The petitioner was allowed a quota of 395.960 tons and 94.747 tons of the oil imported in two consignments sometime in 1970. The delivery of this oil was taken through the respondent-bank on behalf of the petitioner on the stipulation that on payment of the cost of the oil, the Bank shall release oil. On the 22nd October 1970, the petitioner made a payment of Rs.6,66,150 by cheque to the respondent-Bank in full and final settlement of this account and called upon the respondent-Bank to release the remaining oil but the Bank refused to do so. Thereupon, the petitioner filed a suit for mandatory injunction directing the defendant to release the oil and for permanent injunc--petition restraining the respondent-Bank from disposing off the oil. Alongwith the suit, an application for interlocutory injunction was also made for the release of the oil in view of the perishable nature of the goods. The trial Court granted temporary injunction by order dated the 19th January 1970. And directed the respondent---Bank to release the oil within a period of 10 days.
2. The respon--dent filed an appeal which was dismissed by the learned Additional District Judge, Lyallpur, by order dated the 28th April 1971. The matter was then taken in the High Court on the revisional side and a learned Single Judge of the High Court in Civil Revision No. 417 of 1971, set aside the order of the Subordinate Court by judgment dated the 27th October 1971. The High Court has held that there is a general lien in respect of guarantees given by the Bank on behalf of the petitioner and, therefore, the petitioner is not entitled to the release of the edible oil in question. The petitioner seeks permission to file an appeal against the said judgment.
3. Mr. Abid Hassan Minto, learned counsel for the petitioner, has contended that there could not be a general lien of the respon--dent-Bank in respect of the goods in question because they had only simply stood guarantor for the petitioner and had not actually deposited any amount to his credit.
4. His further grievance is that the High Court has decided the entire suit and has thus caused serious prejudice to the case of the petitioner. According to the learned counsel, the High Court has no jurisdiction to set aside the concurrent finding of the Courts below. The points raised by the petitioner require consideration. We would, there--fore, grant leave. Security Rs.2,000. Appeal to be made ready within one month and to be heard soon after long vacation. The learned Civil Judge is directed to proceed with the suit on condition that he will not announce any judgment in the suit itself till the decision of the appeal.