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Official Citation: 2025 CLD 160
Court / Jurisdiction: Lahore High Court
Year of Decision: 2023
Decision Date: 2023-12-31
Parties: Al-Makkah Press (Pvt.) Ltd. etc. vs Standard Chartered Bank (Pakistan) JUDGMENT
Ruling Summary: This decision was rendered by the Lahore High Court on 2023-12-31, officially reported as 2025 CLD 160. In this matter between Al-Makkah Press (Pvt.) Ltd. etc. and Standard Chartered Bank (Pakistan) JUDGMENT, the court adjudicated key questions of statutory construction, procedural regularity, and legal precedent under Pakistani law.
Core Holding: The honorable bench evaluated governing statutory provisions and judicial authorities to establish the rights of the parties, delivering the binding reasoning set out below.
Case cited as 2025 CLD 160
Court Name: Lahore High Court Judge(s): Ch. Muhammad Iqbal, Asim Hafeez Title:Al-Makkah Press (Pvt.) Ltd. etc. vs Standard Chartered Bank (Pakistan)
JUDGMENT
Reported As: 2024 LHC 5472, 2025 CLD 160 Result: Order Accordingly Judgment
JUDGMENT Ch. Muhammad Iqbal, J:- In the Banking recovery suits the pecuniary jurisdiction of this Court is not less than 100 Million Rupees. The Respondent Bank filed a suit for recovery of Rs.101,523,957/07 before this Court and Hon'ble Judge Banking Court passed a decree to the tune of Rs.90,639,457.34 and same by operation of law was converted into execution petition. In Execution Application (Ex. A. No.221429 of 2018), judgment debtor filed application for return of Execution Application for want of pecuniary jurisdiction. The learned Single Judge in Chamber passed order dated 16.10.2018 in C.M. No.1 of 2018, para Nos.1 to 3 and 5 whereof are reproduced as under:- This is an application filed by the judgment debtors seeking, inter alia, return of the execution application on the ground of pecuniary jurisdiction. 2. It is stated that the decree was passed in the sum of Rs.90,639,457.34 which does not come within the pecuniary jurisdiction of this Court and as such the execution application is liable to be returned for its presentation before the relevant banking court. 3. The objection of the judgment debtors is not tenable in as much as the suit filed by the decree holder bank sought recovery of Rs.108,396,405.12. It is an established position of law that for the purposes of determining the valuation of the suit, only the allegations in the plaint are to be looked at and that the plaintiff has an absolute discretion to put his own valuation on the suit. It is also an equally established principle of law that question of jurisdiction is to be determined with reference to the amount claimed in the suit and not with reference to the decree that may be passed. 5. In the circumstances, this application to the extent
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of raising objection on the pecuniary jurisdiction of this Court is hereby dismissed with permission to the judgment debtors to agitate other objections after the filing of the draft proclamation of sale. Accordingly, application of the judgment debtor for return of the execution petition on the basis of want of pecuniary jurisdiction was turned down which order has been assailed through filing Execution First Appeal No.248622/2018. Similarly, in suit for recovery titled as MCB Bank Limited Vs. Al-Hameed Rice Mills, the claimed amount was Rs.108,414,634.84 whereas a final decree of Rs.62,527,590.56 was passed which decree was converted into Execution Application No.15133/2021 wherein learned Single Judge in Chamber conversely held vide order dated 08.06.2021 that the jurisdiction of the executing Court will be determined as per the amount mentioned in the decree and passed order for transfer of execution to the concerned Banking Court. The said order is reproduced as under: In this case judgment and decree was passed for an amount of Rs.62,527,590/-. A learned Division Bench of this Court in EFA No.1059 of 2016 titled Zari Traqiati Bank Limited v. Faran Maiz Industries (Pvt.) Limited has held that the jurisdiction of the executing court shall be determined with reference to the amount of the decree. 2. In this view of the matter, the office is directed to transfer this case to concerned banking court for its further adjudication. The above said order has been assailed through Execution First Appeal No.43805/2021. Both the above appeals (EFAs) were set down for hearing before different learned Division Benches wherein the matters were referred vide orders dated 18.12.2018 and 14.10.2021 respectively, to the Hon'ble Chief Justice for constitution of a Larger Bench. Hence, the above issue is fixed for final determination before this Bench to answer the following question: "Whether a decree of lessor amount than the pecuniary jurisdiction of Judge Banking of this Court in a recovery suit valuing more than 100 Million rupees is executable by this Court or the same is liable to be returned for filing it before the proper forum?" 2. Arguments heard. Record perused. 3. In Section 2(b)(i) of the Financial Institutions (Recovery of Finances) Ordinance 2001, the value of the suit filed before the Banking Court is described as not more than rupees 100 million, whereas valuation of the suit beyond the above said limit, the jurisdiction is vested with High Court under Section 2(b) (ii) of the said Ordinance. For ready reference, aforesaid provision is reproduced as under: "2. Definitions.- In this Ordinance, unless there is anything repugnant in the subject or context-- (b) "Banking Court" means-- (i) in respect of a case in which the claim does not exceed hundred million rupees or for the trial of offences under this Ordinance, the Court established under section 5; and (ii) in respect of any other case, the High Court." (emphasis supplied) Further, in Chapter 3 of Volume I of the Rules and Orders of the Lahore High Court, Lahore the value of the suit for the purpose of court fee and jurisdiction is the value mentioned in the plaint by the plaintiff. As no specific valuation of the suit is mentioned in the Suits Valuation Act, 1887, thus, fixing appropriate value of the suit for the purpose of Court fee & jurisdiction is left at the discretion of the plaintiff. Ordinarily on the basis of value mentioned in the plaint, the pecuniary jurisdiction of the Court is presumed to be the same, however, if the Court modifies the value of the suit then the changed value will be considered as value of the suit for the purpose of pecuniary jurisdiction of a court. Reliance in this regard is placed on cases cited as Zahid Zaman Khan and others Vs. Khan Afsar and others (PLD 2016 SC 409), Mst. Parveen (deceased) through LRs. Vs. Muhammad Pervaiz and others (2022 SCMR 64), Messrs Mardan Ways Sui Northern Gas Pipelines Limited Station Vs. General Manager SNGPL and others (2022 SCMR 584) and Mumtaz Hussain Vs. Haji
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Muhammad Bashir and others (PLD 2016 Lahore 97). Further, a plaintiff is competent to fix the value of the suit for recovery under the Ordinance ibid and if the Banking Court disagrees with the value fixed by the plaintiff, it should determine and fix the value of the suit as per provisions of the Suits Valuation Act, 1887 after holding appropriate inquiry and collecting material and after such determination of value the matter is liable to be adjudicated by the Court of competent jurisdiction. Reliance in this regard is placed on cases cited as Shafaqat Iqbal and others Vs. Ghulam Rasool and another (PLD 2001 Lahore 139) and Muhammad Saleem and 3 others Vs. Pak Brunei Investment Company Ltd. through Chief Manager/President (2022 CLD 84). 4. Furthermore, here the matter is somewhat different as after affixation of the value of the suit by the plaintiff and conclusion of civil trial a decree has been passed. Suffice it to say that after passing of a decree in a suit for recovery by the Banking Court under Section 19 of the Ordinance ibid, the decree is automatically converted into execution proceedings. For ready reference, Section 19 of the Ordinance ibid is reproduced as under: "19. Execution of decree and sale with or without intervention of Banking Court.- (1) Upon pronouncement of judgment and decree by a Banking Court, the suit shall automatically stand converted into execution proceedings without the need to file a separate application and no fresh notice need be issued to the judgment-debtor in this regard. Particulars of the mortgaged, pledged or hypothecated property and other assets of the judgment-debtor shall be filed by the decree-holder for consideration of the Banking Court and the case will be heard by the Banking Court for execution of its decree on the expiry of 30 days from the date of pronouncement of judgment and decree: Provided that if the record of the suit is summoned at any stage by the High Court for purposes of hearing an appeal under section 22 or otherwise, copies of the decree and other property documents shall be retained by the Banking Court for purposes of continuing the execution proceedings. (2) The decree of the Banking Court shall be executed in accordance with the provisions of the Code of Civil Procedure, 1908 (Act V of 1908) or any other law for the time being in force or in such manner as the Banking Court may at the request of the decree-holder consider appropriate, including recovery as arrears of land revenue. " (emphasis supplied) It is settled law that pecuniary jurisdiction should be ascertained from the value assessed by the plaintiff in the plaint and if the Court alters the said value in appeal etc., in that eventuality the pecuniary jurisdiction will remain same as mentioned in the plaint. Reliance is placed on a judgment titled as Dr. Pir Muhammad Khan Vs. Khuda Bukhsh and others (2015 SCMR 1243). 5. In the Ordinance ibid no clear provision is available for transfer of execution petition pending before this Court to any Banking Court below. The Court who has passed the decree in the Banking Suit for recovery, regardless of the fact that either the decree was passed for the amount lessor or higher than the value fixed in the plaint, that Court seized of the suit under Section 19 of the Ordinance ibid is competent to execute its decree. In a judgment titled as MCB Bank Limited through Duly Authorized Attorney Vs. Eden Developers (Pvt.) Limited and others (2019 CLD 219) similar controversy has been resolved holding therein that the pecuniary jurisdiction of executing Court is the amount mentioned in the plaint before the Banking Court. This Court being Banking Court is under legal obligation to execute the decree and pecuniary value of jurisdiction would be the amount mentioned by the plaintiff in the plaint and the Banking Court is the only forum to execute the decree and to decide all ancillary matters relating to the execution, discharge and satisfaction of the decree. For ready reference, relevant portion of the judgment (supra) is reproduced as under:
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"9. The entire reliance of the learned counsel for the applicant was on the judgment of a learned Single Judge of this Court reported as Habib Bank limited through Attorneys v. Messrs Rehmania Textile Mills (Pvt.) Ltd, Jhang Road Faisalabad and 30 others (2003 CLD 689). However, the facts in the cited precedent are distinguishable from the facts in the present case and, therefore, the said judgment cannot form a binding precedent for the purposes of the present case. In Messrs Rehmania Textile Mills the judgment and decree was passed by the Banking Tribunal, Faisalabad (as it then was under the Banking Tribunals Ordinance, 1984) for a sum of Rs.4,36,06,891/-. On appeal, the Division Bench of this Court allowed the appeal and modified the terms of the decree as a result of a compromise between the parties. The execution petition was filed by the decree holder for enforcement of the modified judgment and decree dated 18.3.1999. However, the fact remains that the claim filed by the plaintiff was for a higher sum and the consent decree was passed for lesser amount. The holding of the learned Single Judge was swayed by the definition of the term "Banking Court" given section 2 (b) of the Financial Institutions (Recovery of Finances) Ordinance, 2001. However as distinguished above, in the present case the consent decree was for an amount of Rs.125 Million which was within the pecuniary jurisdiction of this Court. Thereafter certain amounts were paid out of Court and as observed in the proceeding paragraph, they were merely required to be certified by the decree holder or the judgment debtor as the case may be and an execution for the rest of the amount after deducting the certified amount is liable to be take place. In my opinion, the present case does not turn on the definition of Banking court as relied upon in Messrs Rehmania Textile Mills. Moreover, the learned Single Judge did not advert his full attention to the concept envisaged by the Ordinance, 2001 whereby the decree passed by this Court is automatically converted into an execution petition. One may also visualize a situation where the amount of decree ultimately passed by this Court may be much less than the amount claimed in the suit by a plaintiff and which amount may fall below the threshold of pecuniary limit for the High Court to exercise its jurisdiction. Can it be said in that case that the execution of the decree be transmitted to the Banking Court for further proceedings? Clearly the answer to this question is in the negative and the proceedings will be held in the High Court which passed the decree in the first Place........ 10. Thus, the Division Bench of this Court held that the Banking Court which initially assumed the jurisdiction on the basis of the value fixed by the decree holder in the plaint was the only forum which had the pecuniary jurisdiction to execute the decree and to decide all ancillary matters relating to the execution, discharge and satisfaction of the decree." (emphasis supplied) In a case cited as mashraq Bank Vs. Messrs Amtul Rehman Industries (Pvt.) Limited and others (2002 CLD 336), this Court has also held that the forum of execution of the decree under Section 19 of the Ordinance ibid is the Court which has passed the decree in a suit even though amount decreed was less than its pecuniary jurisdiction. For ready reference, relevant portion of the judgment (supra) is reproduced as under: "6. In view of the case-law cited by the learned counsel for both the parties I am of the considered view that the determining factor, for the purposes of jurisdiction, shall be the amount fixed by the plaintiff in the suit and on which amount the subject-matter of the suit has been valued. Once the plaintiff determines the value of the suit/ relief in the plaint that shall be conclusive for the purpose of determining the forum of appeal etc. 7. In view of the above conclusions and findings I am of the considered view that this Court can neither entertain this execution petition nor undertake the execution proceedings on account of lack of pecuniary jurisdiction. In this case the Banking Court, which initially assumed the jurisdiction on the basis of the value fixed by the decree-holder in the plaint itself, is the only Court which has
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the pecuniary jurisdiction to execute the decree, to decide the other matters relating to the execution, discharge and satisfaction of the decree and to deal with all the ancillary matters relating thereto. The net result is that the objection of the learned counsel of the judgment-debtors regarding the want of pecuniary jurisdiction prevails, thus, I am constrained to hold that this Court has no jurisdiction to try this execution petition and, therefore, the decree shall stand transferred to the Banking Court No.4, Lahore for its execution." Another reliance is placed on a judgment titled as MCB Bank Limited Vs. Messrs Mazco Industries Private Limited and others (2023 CLD 410). 6. As discussed above that this Court, as a Banking Court, has the jurisdiction to execute the judgment & decree passed by it irrespective of the quantum of amount so decreed as such the order dated 08.06.2021 (supra) passed in Exh.A.No.15133/2021 titled as MCB Bank Limited Vs. Al- Hameed Rice Mills by the learned Single Judge in Chamber is not sustainable and hereby set aside. Furthermore, the judgment dated 06.06.2018 passed by the learned Division Bench in E.F.A No.1059/2016 titled as Zarai Taraqiati Bank Limited Vs. Faran Maiz Industries (Pvt.) Limited [relied upon by the learned Single Judge in Chamber while passing order dated 08.06.2021], being passed in violation of Section 19 of the Ordinance ibid as well as the settled principle of law, is per incuriam. Reliance in this regard is placed on cases cited as Muhammad Jawad Hamid Vs Mian Muhammad Nawaz Sharif & Others (PLD 2018 Lahore 836), Qaiser & Another Vs The State (2022 SCMR 1641). The final resolve of the above is that the decree passed by the learned Banking Judge of this Court is liable to be exclusively executed by the said Court itself. 6. The question referred to this Bench has been answered accordingly. I agree with reasoning and conclusion recorded by both my brother judges. I have added a separate note.
Asim Hafeez, J. I have the privilege of reading the draft judgment handed down by my esteemed colleague, Ch. Muhammad Iqbal, J., I agree with the outcome of the adjudication and conclusion(s) drawn with respect to the question(s) referred for determination; however, I prefer to state my own reasons and analyses to substantiate the outcome / conclusion(s) reached. Putting into perspective, the controversy confronted is paraphrased hereunder:- 'what essentially is the criterion-cum-benchmark for determining the pecuniary jurisdiction of the Court executing the decree, be it a money decree, decree for foreclosure or sale of mortgage property or redemption thereof; and if at all, that determination is warranted in the context of special jurisdiction / law, in terms whereof decree(s) are sought to be executed'. 2. Before discussing specifics, it is appropriate to give a rundown of the statutory framework, dealing with the execution-cum-transfer of decree(s), provided in Part-II of the Code of Civil Procedure, 1908 (the 'Code'). It is appropriate to reproduce the text(s) of relevant provisions, i.e., sections 37, 38, 39 & 41 of the Code, to contextualize distinguishing features of special and general jurisdiction(s). Section 37- Definition of Court which passed a decree.- The expression "Court which passed a decree" or words to that effect, shall in relation to the execution of decrees unless there is anything repugnant in the subject or context, be deemed to include, -- (a) where the decree to be executed has been passed in the exercise of appellate jurisdiction, the Court of first instance, and (b) where the Court of first instance has ceased to exist or to have jurisdiction to execute it, the Court which, if the suit wherein the decree was passed was instituted at the time of making the application for the execution of the decree, would have jurisdiction to try such suit.
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Section- 38. Courts by which decrees may be executed. --A decree may be executed either by the Court which passed it, or by the Court to which it is sent for execution. Section- 39. Transfer of decree -- (1) The Court which passed a decree may, on the application of the decree-holder, send it for execution to another Court, -- (a) if the person against whom the decree is passed actually and voluntarily resides or carries on business, or personally works for gain, within the local limits of the jurisdiction of such other Court, or (b) if such person has no property within the local limits of the jurisdiction of the Court which passed the decree sufficient to satisfy such decree and has property within the local limits of the jurisdiction of such other Court, or (c) if the decree directs the sale or delivery of immovable property situate outside the local limits of the jurisdiction of the Court which passed it, or (d) if the Court which passed the decree considers for any other reason, which it shall record in writing, that the decree should be executed by such other Court. (2) The Court which passed a decree may of its own motion send it for execution to any subordinate Court of competent jurisdiction. Section- 41. "Result of execution proceedings to be certified. -- The Court to which a decree is sent for execution shall certify to the Court which passed it the fact of such execution, or where the former Court fails to execute the same the circumstances attending such failure". 3. Section 37 describes the forum for the execution of decree in certain eventualities. Section 38 expands the footprint of the Court(s) for the purpose of execution of the decree - by introducing a transferee court. Subsection (1) of Section 39 extends choice to the decree holder to seek transfer of decree, subject to the conditions provided in clauses (a) to (c) thereof. And sub-section (2) of section 39 envisages transfer by the Court on its own initiative. Section 41 obligates transferee court to certify result to the transferor Court. Context changes everything. It is significant to emphasize that matter at hand arose out of the proceedings, initiated and are continuing, under the special jurisdiction, extended in terms of the Financial Institution (Recovery of Finances) Ordinance, 2001 (the 'Ordinance, 2001'). Unlike, the mechanism provided in the Code for initiation of proceedings for the execution of the decree, sub- section (1) of section 19 of the Ordinance, 2001 provides a conduit between the suit proceedings and execution proceedings, whereby character of the former proceedings converts into latter, upon pronouncement of the Judgment and decree. In essence, under the special jurisdiction, one set of proceedings changes shade, ipso-facto through the operation of law / involuntarily - from pre-decretal proceedings to post-decretal proceedings - in contrast to the mechanism available under the Code. It is elaborated that pre-decretal proceedings envisage process where a case/suit/action is brought before the Court of competent jurisdiction for adjudication of a specified claim [which is an 'unadjudicated claim']. And upon adjudication, such claims, unless dismissed; either accepted partly or fully through a judicial pronouncement, assume the status of an 'adjudicated claim / decreed claim'. Choice exercised and assumption of jurisdiction by the Court of competent jurisdiction, is dependent upon addressing various jurisdictional qualifying standards, statutorily defined - which have no proximity to the controversy. Pecuniary jurisdiction, other than the territorial, subject matter and status-based jurisdiction, is relevant for the purposes of present controversy. Significance and benchmark criterion for determination of pecuniary jurisdiction of a particular court is determinable at the time of presentation of the plaint or entertaining an action or a suit. There is no uncertainty or ambiguity that pecuniary jurisdiction of the court, entertaining an action / suit, is determined on the basis of the value of the relief claimed, nevertheless subject to correction by the Court in case of alleged manipulation through under- valuation or over-valuation. Under the Ordinance, 2001 pecuniary limits are prescribed in terms of
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section 2 (b) of the Ordinance, 2001, which provides the forum(s) of the Banking Court, established under section 5 of the Ordinance, 2001, or the High Court, as the case may be - pecuniary limits defined in clauses (i) and (ii) of sub-section (b) of section 2 of the Ordinance, 2001 are reproduced, - after enhancement in consequence of the Financial Institution (Recovery of Finances) Amendment Act, 2016 (Amendment Act, 2016). Section 2 (b) reads as, 2(b) "Banking Court" means-- (i) in respect of a case in which the claim does not exceed hundred million rupees or for the trial of offences under this Ordinance, the Court established under Section 5: and (ii) in respect of any other case, the High Court". 4. There is no dispute regarding mechanism for determination of the pecuniary jurisdiction of competent forum for entertaining the case / suit. An obvious question that stirs curiosity is; if at all it is imperative that adjudicated claim / decreed amount must also fall within the pecuniary limits of the forum, prescribed under section 2(b)(i) & (ii) of the Ordinance, 2001, tasked with the execution of the decree; or Whether pecuniary jurisdiction of the Court executing the decree needs to be re-visited to ensure that quantum of adjudicated claim / decreed amount must come within the pecuniary limits of the Court, before giving effect to the decree. Apparently, no such re-determination of pecuniary limits is required under special jurisdiction, since one form of proceedings stood involuntarily converted into the other form of proceedings, under the mandate of sub-section (1) of section 19 of the Ordinance, 2001. Uncertainty in fact intensified in wake of the decision, dated 06.06.2018, in the case of Zarai Taraqiati Bank Limited v. Faran Maiz Industries (Pvt) Ltd. ("EFA No.1059/2016"), wherein learned Division Bench of this Court had affirmed the decision of transfer of decree from the High Court, which passed the decree, to the Banking Court, established under section 5 of the Ordinance, 2001, for the purpose of execution, on the premise that quantum of adjudicated claim / decreed amount of Rs.75.425 Million, fell below the revised pecuniary jurisdiction of the High Court - enhanced to deal with claims over Rs.100.000 Million. Learned Division Bench of this Court arrived at…
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