PAKISTAN REFUGEE REHABILITATION FINANCE CORPORATION vs K. S. KAMMU
This petition for special leave to appeal challenged an order of the West Pakistan High Court, which dismissed the petitioner's appeal regarding the execution of a decree. The petitioner, the Pakistan Refugee Rehabilitation Finance Corporation, sought to attach funds held by the respondent, K.S. Kammu, to recover an outstanding loan. The petitioner argued that under the Pakistan Refugees Rehabilitation Finance Corporation Ordinance 1948, it was entitled to recover sums due as arrears of land revenue. The core legal question was whether the Corporation could unilaterally determine the amount due and attach the respondent's decretal funds without a prior judicial or competent determination of the debt. The Supreme Court held that while the Corporation may recover sums as arrears of land revenue, it lacks the authority to unilaterally quantify the debt, especially where the Corporation had previously taken over the respondent's business. Consequently, the Court affirmed the High Court's decision, ruling that the Corporation cannot attach the respondent's decree until the specific amount due is determined in accordance with the law.
- Can a statutory corporation unilaterally determine the amount of a debt due to it to facilitate recovery as arrears of land revenue?
- Is a prior determination of the exact debt amount by a competent authority a prerequisite for attaching a decree under the Revenue Recovery Act 1890?
- Does the power to recover sums as arrears of land revenue authorize a corporation to bypass judicial determination of disputed liabilities?
- Section 11, Pakistan Refugees Rehabilitation Finance Corporation Ordinance 1948
- Section 5, Revenue Recovery Act 1890
ORDER
1. WAHIDUDDIN AHMAD, J.-This petition for special leave to appeal is directed against the order of the West Pakistan High Court, Karachi Bench, in Letters Patent Appeal No. 102 of 1967, decided on the 8th May 1969. By this order, the High Court dismissed the appeal filed by the petitioner. The dispute between the parties is about the execution of a decree passed in favour of the respondent in suit No. 76 of 1961 decreed in the sum of Rs. 1,89,406 on the 24th October 1966. The High Court, Karachi Bench, passed this decree in favour of the respondent for damages owing to malicious arrest and detention. This decree was executed by respondent No. 1 on the 10th December 1966. On a garnishee order passed in his favour, the National Bank of Pakistan deposited a sum of Rs.
2. 1,66,612.95 in response to the order of the High Court.
3. It appears that on the 23rd May 1951, a loan of Rs. 1,00,000 was advanced by the petitioner to respondent No. 1 to enable him to carry on his business. This amount remained unpaid. In 1954, action was taken against respondent No. 1 under sec--tion 11 of the Pakistan Refugees Rehabilitation Finance Corpora--tion Ordinance of 1948. While the matter was pending before the City Deputy Collector, Karachi, the parties entered into an agreement on the 13th February 1956, and under its terms, the petitioner took over the business of respondent No. 1 with the object of repaying its loan from the business of a Motor Repair--ing Garage. In this connection, the petitioner invested a sum of Rs. 57,589 for improvement of the business. In spite of this, the petitioner was unable to recover its loan. In July 1958, fresh proceedings for the recovery of the loan were started and respondent No. 1 was arrested and kept in civil prison from 15th July 1958 up to 14th of January 1959. It was in that connec--tion that the respondent No. 1 obtained a decree for the above sum of Rs. 1,89,406 against the petitioner.
4. On the 17th December 1966, the City Deputy Collector, revived the proceedings and requested the High Court to adjust the amount of loan towards the decretal amount. He further requested that an attachment of an amount equal to that which was claimed by the petitioner, be made. These requests were considered by a learned Single Judge of the High Court who rejected the objections and declined to order attachment as requested. This decision was challenged in the above Letters Patent Appeal before the High Court. As already stated the appeal was dismissed. The High Court dismissed the appeal on the ground that there was no material to show how much amount was due from respondent No. 1 and unless that was determined by a competent authority, the amount deposited by the National Bank of Pakistan could not be attached. The petitioner seeks permission to file an appeal against the said order.
5. "All sums due to the Corporation shall be recoverable as arrears of land revenue, and the Corporation shall be deemed to be a local authority for the purposes of section 5 of the Revenue Recovery Act, 1890."
6. This contention has no force. According to the above provision of law, all sums due to the Corporation shall be recoverable as land revenue. There is, however, no power given to the petitioner Corporation to unilaterally declare the sums due to it from a debtor. In the present case, it is evident that the petitioner has taken over the business of the respondent No. 1 and there is nothing to show what amount has been recovered from this business by the petitioner. In these circumstances, the High Court was perfectly justified in holding that unless the amount due to the petitioner is determined in accordance with law, they were not entitled to attach the decree passed in favour of respondent No. 1 under section 5 of the Revenue Recovery Act of 1890.
7. Mr. Ali Ahmad Fazeel contended that the respondent No. 1 has admitted the loan as due from him.
8. In this connection he referred to the statement of respondent No. 1. In our opinion, this statement is not an admission of the nature which the learned counsel wanted to stress before us. In any case, this admission is not sufficient to authorize the petitioner to determine what amount was due to it under the above provision of law. In these circumstances, the High Court was quite justified in refusing to entertain the claim of the petitioner in respect of the loan in the execution proceedings.
9. There is no force in the petition which is dismissed.