KAMRAN INDUSTRY (PVT.) LTD. vs INDUSTRIAL DEVELOPMENT BANK OF PAKISTAN through Regional Manager, Regional Office, Lahore and 2 others

' AJMAL MIAN, J.---This is a petition for leave to appeal against the judgment dated 30-5-1993 of a learned Single Judge of the Lahore High Court at Multan Bench, Multan in Civil Revision No, 306 of 1993 filed by the petitioner against the order dated 14-2-1993 of the learned Civil Judge rejecting the petitioner's suit for declaration under Order 7, rule 11, C.P.C. On the ground that the petitioner got no cause of action and the judgment dated 24-5-1993 of the learned Additional District Judge, Multan in Civil Appeal No,83/13 of 1993 of the petitioner against the above order, dismissing the same, declining the same.

2. The brief facts are that the petitioner obtained certain loan from respondent No, 1 for setting up Industry. The petitioner executed certain documents in respect of the above transaction and also furnished bank guarantee. Respondent No, 1 initiated proceedings for recovery of their alleged dues. The case of the petitioner was that the breach was on the part of the respondent as it had not released the full amount of loan. The petitioner filed above Suit No, 220 of 1992 for declaration to the effect that the loan agreement dated 8-12-1990 was illegal, ultra vires and was result of undue influence and ineffective. It was also prayed that the bank guarantee issued by defendant No,3 now respondent No, 3 on the basis of the above agreement was also of no legal effect and that defendant No, 1 i,e. Respondent No, 1 had no right to ask for encashment of the guarantee from respondent No,

3. In the above suit respondent No, 1 filed an application under Order 7, rule 11, C.P.C., which was allowed on the above ground. The petitioner's above Appeal and Civil Revision failed.

The petitioner has, therefore, filed present petition for leave to appeal.

3. In support of the above petition Chaudhry Muhammad Nazir Ahmed, learned Advocate Supreme Court; appearing for the petitioner, has vehemently contended that the learned Civil Judge rejected the petitioner's plaint of the suit under Order 7, rule 11 on the basis of the documents filed by respondent No, 1, which was contrary to law, as averments contained in the plaint of the suit should have been presumed to be correct for the purpose of Order 7, rule 11, C.P.C.

' The above contention seems to be correct. The learned Civil Judge was not justified in rejecting the plaint on the ground that there was no cause of action accrued to the petitioner. This was a matter on merits of the case. We would have granted leave for the above reason but we find that under the Banking Companies (Recovery of Loans) Ordinance, 1979, hereinafter referred to as the Ordinance, by virtue of subsection (4) of section 6 thereof, the jurisdiction of the other Courts is excluded in respect of the matters which - are within the jurisdiction of the Special Courts, established under the Ordinance. Clause (a) of subsection (1) of section 6 of the Ordinance defines civil jurisdiction as under:- "(a) in the exercise of its civil jurisdiction, have in respect of a claim filed by a banking company against a borrower or by a borrower against a banking company in respect of, or arising out of, a loan all the power vested in a Civil Court under the Code of Civil Procedure, 1908 (Act V of 1908);"

' In view of the above provision it was open to the petitioner to have approached the Banking Court against respondent No, 1 for any claim, even now it will be open to the petitioner to approach the Banking Court in accordance with law.

In this view of the matter the learned Civil Judge was right in rejecting the plaint but not on the ground which found favour with him. The plaint was liable to be rejected under clause (d) Order 7, rule 11 of C.P.C., which provides that the plaint shall be rejected "where the suit appears from the statement in the plaint to be barred by any law".

' We are, therefore, of the view that the impugned orders/judgments are unexceptionable for the above reasons.