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Petitioner: ANEES-UR-REHMAN VS Respondent: FAYSAL BANK LIMITED through Manager
Court Name: Sindh High Court Judge(s): Aqeel Ahmed Abbasi, Aziz-ur-Rehman Title: ANEES-UR-REHMAN vs FAYSAL BANK LIMITED through Manager Case No.: I.A. No. 12 of 2018 Date of Judgment:2018-03-15 Reported As: 2019 CLD 1031 Result: Appeal dismissed
JUDGMENT
JUDGMENT AZIZ-UR-REHMAN, J.---By means of this 1st Appeal filed by the Appellant on 26.01.2018 , under section 22 of the Financial Institutions (Recovery of Finances) Ordinance, XLVI of 2001, the Appellant [Plaintiff] has challenged the 'Impugned Order' dated 04.01.2018 [Annexures 'A' to the MoA], passed by the learned Judge, Banking- Court No,1, at Karachi, in a Suit for DECLARA TION bearing No,759/2012 [Anees-ur -Rehman v. Messrs Faysal Bank Limited ], whereby , the learned Banking Judge, besides, dismissing [i] the Appellant's [Plaintiffs] application for AMENDMENTS and [ii] Respondent Bank's [Defendant] application under Order I, Rule 10 read with section 151, C.P.C. for joining the 'customer' viz. Mr. Waqar Zia, as being a sole proprietor . of Messrs Safa Sports Wear, in Suit No,759/2012, as a party , the 'plaint' , was also rejected by exercising 'suo motu' jurisdiction. The prayers sought by the Appellant in the instant 1st Appeal reads as follows:- "1]. Appellant prays that this Hon'ble Court may be graciously pleased to set aside the impugned order dated 04.01.2018 passed by the learned Judge of Banking Court No,1 at Karachi with the direction to decide the suit in accordance with section 10(11) of the Financial Institutions (Recovery of Finances) Ordinance, 2001 strictly on merits and keeping in view of the principle of natural justice and equity . 2]. The appellant seeks costs and any further or other relief deemed appropriate by this Honourable Court in the circumstances of the case." 2. Precisely , the facts leading to the filing of the instant 1st Appeal are that Appellant was running business under the name and style of Messrs Anis Sports wear and thus, use to supply locally manufactured garments to Aga Khan Hospital. For carrying on the business, the Appellant opened Account No,51201006790 with Messrs Prime Commercial Bank Limited, ST -3, 12/A, Industrial Area, Karachi. 3. Per version of the Appellant, in the year, 2006-2007, Messrs Prime Commercial Bank Limited publicized for the Term Deposit Income' and in this regard hand bills, as asserted, were also distributed. According to Appellant's
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stand, Messrs Prime Commercial Bank Limited had not only assured but also offered more profit than what had been offered by the National Savings Centre. For and in view of such scenario, the Plaintif f/Appellant, as stated, withdrew his amount from the National Savings Centre, Azizabad, Karachi, and thereafter , the same was directly deposited with Messrs Prime Commercial Bank Limited, ST-3, Sector 12-A, Industrial Area, Karachi, through a cheque. 4. Messrs Prime Commercial Bank Limited initially , was merged with ABN Amro Bank, then Royal Bank of Scotland and lastly with Faysal Bank Limited/Resp ondent Bank herein. The Appellant, as averred, deposited an amount of Rs.400,000/- for five years with the Respondent Bank vide TDR Deal No,12 , on 1st July 2006 , at half yearly credit of profit @ 9.71/4 was also allowed on 10.01.2007 of Rs.22,318 . Besides, as averred, the Appellant further deposited Rs.260,000/- vide Deal No,31 dated 28.9.2006, with the Respondent Bank also against yearly profit of 9.7%, for a term of 5 years . 5. Per Appellant/Plaintif f's version, time and again he made requests to the Banks for withdrawal of 'Term Deposits' and 'Profits' thereon, but Respondent Bank did not give any heed to the requests of the Appellant. The Respondent Bank, instead, continued to change from (i) Prime Commercial Bank to ABN Amro Bank, (ii) from ABN Amro to RBS of Scotland (iii) From RBS Scotland to Faysal Bank, however , without meeting/g iving any heed to the time and again requests of the Appellant [Plaintiff ]. According to Appellant [Plaintiff ], the said Bank[s], have actually usurped the deposits and profits accrued thereon. The amounts of two [2] 'T erm Deposits' and Profits thereon, as per Appellant's workout are as follows: - i. Term Deposit bearing No, 12 of Rs.4,60,000/- dated 07.07.2006.Rs.4,60,000/- ia.Profit as per agreed rate @ 9.7% from 01.7.2006 till 15.11.2011Rs. 3,47,224/- ii. Term Deposit bearing No,31 of dated 28.9.2006Rs.2.60.000/- iia.Profit on Rs.2,60,000/- as agreed at 9.7% @ 9.7% as worked at aboveRs.2,26,078/- Rs. 12,93,302/- (Total Rupees twelve lacs ninety three thousand and three hundred and two only) 7. The Appellant, upon maturity , again requested the Respondent Bank for release of TDRs' amounts along with accrued profit thereon, total amounting to Rs.1,293,302/-, so that the same, as averred by the Appellant [Plaintiff ] be re-invested at a better rate, but the Respondent Bank for the reasons best known to it, however , failed and/or avoided to do so. Hence, the Appellant [Plaintiff ], filed Suit No,759/2012 [Anees-ur -Rehman v. Messrs Faysal Bank Limited ], for DECLARA TION under FIO 2001, against the Respondent Bank [Defendant] before the Banking Court No,I, at Karachi.- 8. Upon filing of the above Suit No,759/2012 [Anees-ur -Rehman v. Messrs Faysal Bank Limited ] on 13.12.2012 , for 'DECLARA TION' and, of course, after issuance of process/service of summons, as required under law, the Respondent Bank, filed its 'LEAVE TO DEFEND APPLICA TION' under section 10 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 [In short F.I.O., 2001] wherein, besides, raising 'PRELIMINAR Y OBJECTIONS' regarding 'MAINT AINABILITY' of the suit, the adverse assertions / stand taken by the Plaintif f / Appellant herein, were/was vehemently denied / controverted. The 'PRELIMINAR Y OBJECTIONS' / 'DEFENCE PLEAS' , raised by the Respondent Bank [ Plaintiff ] read as follows:- A. That the present suit is hopelessly time barred as the TDRs in question had been deposited with the answering defendant in 2006 as according to the own showing of the plaintiff and the said TDRs had been deposited with the Defendant in 2006 which had been encashed and adjusted against the liabilities of the plaintiff and his son-in-law way back in 30.09.2008 and 29.09.2007, whereas the resent suit has been led in Janua 2013 after a lapse of 5 to 6
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years more over no condonation of delay has been sought thus on this count alone the present suit merits to be dismissed with special cost. B. That the present suit is hit by the Non-Compliance of section 9(3) of F.I. 0., 2001 thus on this count alone the present suit merits to be dismissed. C. That the provision of APPROBA TION AND REPROBA TION hit the present suit. The plaintiff' doesn't have legs to stand thus have REPROBA TED AND APPROBA TED his own contentions which is not permissible in law . D. That the plaintiff's' attitude and the filing of the present suit is hit by principle of laches and acquiescence more particularly after committing default as such the agreement in question is acted upon, rendering the plaintiff liable by virtue of doctrine of promise, silence, approbation and reprobation as envisaged in the Quranic verses i,e, one in opening Surha MAIDA and that of other appraising in Surha AL-SARRA exclusive of other Quranic verses according to which a duty is cast upon the plaintiff to fulfill the promise, honor the commitment and discharge the obligations to satisfy legal commitment of the contract in question. E. That the present suit is based on concealment of facts. The plaintiff had malafide ly concealed material facts from this Hon'ble Court. F. That the present suit had been malafidely filed by the plaintiff after a lapse of 5 to 6 years in order to blackmail the defendant as the plaintiff is well aware that TDRs that were pledged with the defendant had been rightly encashed by the defendant the plaintiff was well satisfied with the said redemption which had attained finality and at this belated stage had filed the present suit only to pressurize the answering defendant and to get waivers in the default running account of Sofa Sports W ear in which the plaintiff is a guarantor all sums due and payable. G. That the title suit is hit by the principle of MIS-JOINDER AND NON-JOINDER of the parties. As the plaintiff had malafidely not joined the proprietor of Safa Sports Wear for whom the plaintiff had stood guarantor for the repayment of all sums that were due and payable by Safa Sports Wear and the other guarantor of the said facilities. H. That the title suit is not maintainable against the answering defendant as the plaintiff is the guarantor of the Messrs Safa Sports Wear who had availed the finance facilities from the defendant and after fully utilizing the same had created a default in making repayment thus is hit by. the provisions of section 37 of Contract Act, hence the suit of the plaintiff liable, to be dismissed on this sole ground. I. That the suit is not maintainable as plaintiff has completely failed to establish any cause of action against the answering defendant. J. That the prayer clause of the plaintiff is in contravention of the statutory provision of law, hence illegal and is liable to be rejected and the suit of the plaintiff is liable to be dismissed on this score alone. K. That the defendant vehemently denying the contents/statements as stated in the plaint as the facts have been distorted and the plaintiff has concealed various aspect. There are triable issues involved in the instant suit, which cannot be resolved without recording of evidence. [Underling is ours] 9. The Respondent Bank in reply thereto had also filed 'REPLICA TION' under section 10(7) of the Financial Institutions (Recovery of Finances) Ordinance, 2001, [In short F.1.0., 2001] wherein, the 'adverse allegations' contrary to the Appellant's / Plaintif f's version were denied. Paras 6, 7, 8 and 27 from the 'REPLICA TION' , filed by the Appellant [Plaintiff ] being relevant, as far as, the dispute in hand is concerned, are respectively , are reproduced herein below:- "6. The total amount on TDRs 12 and 31 therefore comes to Rs.14,00,86 (Rupees Fourteen Lac Eight Hundred Sixty One) which the Plaintiff has claimed from the bank. This claim was clearly and vividly made known to the defendant as per , (Plaintiff's letter dated 21-01-2013 is Annex-A-5) and several other letters i,e, 12-12-2012 etc. 7. The defendants: in his Application under section 10 of Banking Laws has at last admitted both the T.D.Rs deposit of Rs. 469625 and Rs.260,000. 8. The Defendant Bank has however asserted in Defense that the Plaintiff still owes to the Bank and have made contradictory claims that they were adjus ted and Bank, further states that the claims are barred by limitations, the defendant Bank has come out with half settlement. of Accounts. The Plaintiff therefore submits as follows:-
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27. Para 8 of Defendant Bank is misleading it is incorrect to say that the Plaintiff had given a go ahead for encashing the entire TDRs and adjusting the same in 2011 after the legal notice was sent. Contrarily the Plaintiff had made a request to adjust entire loans facilities of all TDRs and moveable securities in the name of plaintiff and his daughter Uzma Tabassum on 29.03.2007. Prime bank letter of acknowledgement dated 17.04.2007 is available as enclosure A-15, which refer to partial adjustment which was not acceptable and therefore the Prime Bank (now Faysal Bank) issued another letter of entire adjustment of loan facility vide their letter dated 31.05.2007 stating entire liability at Rs.35,17,220/- whereas the Plaintiffs and daughter's value of entire TDRs and securities as at the date of request 29.03.2007. Stood exceeding the aforesaid amou nt i,e, at Rs.35,23,220/- the calculation/working of rates of DSCs is available on inter-net that was furnished to the Bank then and is available as enclosure A-6." [Underlining is ours] 10. The learned Banking Court No,1, at Karachi, after hearing of the Bank's Leave-to-Defend Application under section 10 of Financial Institutions (Recovery of Finances) Ordinance, 2001 [XLVI of 2001], allowed the same vide order dated 13.05.2014 . The 'operative part' of LEA VE granting Order dated 13.05.2014 reads as follows: "The perusal of the record reveals that the plaintiff along with application for leave to defend the suit has filed various charge documents and letters exchange between the parties as Annexure L/7 to L/43. The said charge documents pertains to advance of finance facility extended to the plaintiff and Messrs Safa Sportswear and its guarantors as charging in the present suit. It is apparent that the TDRs in question were pledged against the finance facility to the plaintiff and Messrs Safa Sportswear . The question raised by the defendant constitutes substantial question of law and facts which was not called in question by the other side, thus matter require recording of evidence. Therefore the application for leave to defend the suit filed by the defendant Bank is hereby granted unconditionally" . [Underling is ours] 11. The Appellant [Plaintif f], after the grant of 'LEAVE-T O-DEFEND APPLICA TION' on 13.05.2014 , to the Respondent Bank un-conditionally , filed an 'APPLICA TION' for seeking about EIGHTEEN [18] AMENDMENTS in the 'prayer clause'. The Respondent Bank [Defendant], also filed an application under Order I, Rule 10, C.P.C., for impleading 'principal customer' viz. MR. WAQAR ZIA, sole proprietor of Messrs Safa Sportswear . Both the said applications were heard on 04.01.2018 . The learned Banking Court-I at Karachi, besides, dismissing the aforesaid two [2] applications, also 'REJECTED' the 'PLAINT' vide 'impugned order' dated 04.01.2018 . The 'relevant portion' from the 'impugned order' of 04.01.2018 , is reproduced hereinbelow:- 6. ... The plaint under section 9 of the Ordinance must disclose cause of action which spell out the default or breach in fulfillment of any obligation with regard to any finance arising out of the contract between the parties. Under section 9(2) of the Financial Institutions (Recovery of Finances) Ordinance, 2001, the plaint has to be supported with all other relevant docume nts relating to the grant of finance but in the instant case not only the plaint does not fulfill the statutory requirements of section 9 of Financial Institutions (Recovery of Finances, Ordinance, 2001 but also no any charge document in support of the plaint relating to the finance has been filed. It is settled principle of law that Court can always nip a frivolous suit in the bud by rejecting the plaint in order to retain its docket and time for some serious claim s. The Court enjoys an insular power under Order VII, Rule 11, C.P.C. to examine the plaint, primarily on the basis of the contents of the plaint. The instant plaint is vague, generalized, unspecified and vexatious. The alleged cause of action does not constitute a cause required of plaint which necessitates an action under the Financial Institutions (Recovery of Finances) Ordinance, 2001 against the defendant, particularly when the prayer made by the plaintiff cannot be granted in view of the pleadings. In view of the above facts and circumstances both the applications are not maintainable thus dismissed and the plaint is also hereby rejected . [Underling is ours] 12. The Appellant [Plaintiff ], thus feeling 'aggrieved' and 'dis-satisfied' with the 'impugned order' dated 04.01.2018, has approached this Court with a prayer for setting aside the 'impugned order' dated 04.01.2018 [Annexure 'A' to MoA] . 13. On 23.02.2018 when, the above 1st Appeal No,12 of 2018 [Anees-ur -Rehman v. Messrs Faysal Bank Limited] , came-up before us then, we heard Mr. Haris Rasheed Khan, learned counsel for the Appellant [Plaintiff ] and also gone through the 'impugned order' dated 04.01.2018 and available record before us minutely and thereupon, 1st
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Appeal was 'DISMISSED' in limine by our short order dated 23.02.2018 . The short order for ready reference is also reproduced herein below:- 1. For Order on office objection along with reply as at "A". 2. For Hearing of Main Case 23-02-2018 . Mr. Haris Rasheed, advocate for the appellant. For the reasons to be recorded latter on, instant appeal is dismissed in limine." 14. Mr. Haris Rashid Khan, learned counsel for the Appellant [Plaintiff ] contended in vehemence that the 'impugned order' dated 23.02.2018 , passed by the Banking Court No,1, at Karachi, besides, erroneous, has been passed in violation of law, as such, the same is liable to be set-aside. Per learned counsel, the learned trial Court under the facts and circumstances of the case, was not justified to pass the impugned order , as on the date when the plaint was rejected under Order VII, Rule 11, C.P.C., the case was fixed for hearing of two [2] Applications i,e, [i] Application for ABOUT 18 Amendments in the 'Prayer Clause' of the 'PLAINT' filed by the Appellant [Plaintiff ] and [ii] Application under Order I, Rule 10, C.P.C., read with section 151, C.P.C., filed by the Respondent Bank for IMPLEADING the 'Principal Customer' as a party in the Plaintif f's Suit No,759/2012 [Anees-ur -Rehman v. Messrs Faysal Bank Limited], out of which the instant 1st Appeal has arisen. 15. According to Mr. Haris Rashid Khan, the Banking Court No,I, at Karachi, was bound under law to decide the suit on merits in accordance with section 10(11) of F.I.O., 2001. Per learned counsel, upon granting unconditional leave to defend , on 13.05.2014 , to the Respondent Bank, the REJECTION of the 'plaint' under suo motu exercise of jurisdiction by the Banking Court No,1, at Karachi, and that too, without framing of issues is neither legal nor otherwise, justified. According to Mr. Haris Rashid Khan, learned counsel for the appellant [Plaintiff ], the 'impugned order' dated 13.05.2014 is not only perverse, arbitrary , but also against the settled principle of law. Per Mr. Haris Rashid Khan, the 'impugned order' dated 13.05.2014 is liable to be set aside, otherwise, the Appellant [Plaintiff ], shall be seriously prejudiced. 16. Lastly , learned counsel for the Appellant/[ Plaintiff ] contended that the amount of pledged TDR's , in any event, is required to be reimbursed to the Appellant [Plaintiff ], as the said pledged TDR's have been encashed by the Respondent Bank without giving/issuing 'Mandatory Notice' to the Appellant/[ Plaintiff ], as required, under Section 176 of the Contract Act [IX of 1872]. 17. Heard. 18. The Respondent Bank in its 'Leave-to-Defend Application' had not only denied the 'assertions' made by the Appellant/Plaintif f contrary to the stand of Respondent Bank, but had also raised 'PRELIMINAR Y OBJECTION' vis- -vis MAINT AINABILITY OF THE SUIT filed by the Appellant [Plaintiff ]. From bare perusal of the plaint , it appears that the Appellant [Plaintiff ] has miserably failed to bring his suit within the ambit of section 9 of Financial Institutions (Recovery of Finances) Ordinance, 2001, which inter alia, requires that 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. In the case in hand, the Appellant [Plaintiff ] has neither alleged any 'default' with regard to any 'finance' on the part of Respondent Bank nor otherwise, any 'relationship' of a customers and financial institution in the PLAINT has been pleaded/asserted . 19. To see and properly appreciate the Appellant's case in juxtaposition of the 'PRELIMINAR Y OBJECTIONS' regarding maintainability of the suit, we would like to refer to and reproduce hereinbelow subsections [1], [2] and [3] of section 9 of F .I.O., 2001, respectively:- "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. (2) The plaint shall be supported by a statement of account which in the case of a financial institution shall be duly certified under the Bankers' Books Eviden ce Act, 1891 (XVIII of 1891), and all other relevant documents relating to
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the grant of finance. Copies of the plaint, statement of account and other relevant documents shall be filed with the Banking Court in sufficient numbers so that there is one set of copies for each defendant and one extra copy . (3) The plaint, in the case of a suit for recovery instituted by a financial institution, shall specifically State -- [Underlining is mine]. (4) (a) the amount of finance availed by the defendant from the financial institution; (b) the amounts paid by the defendant to the financial institution and the dates of payment; and (c) the amount of finance and other amounts relating to the finance payable by the defendant to the financial institution up to the date of institution of, the suit. (4)......................... (5)........................" 20. Manifestly , per section 9 of F.I.O., 2001 [Ordinance XLVI of 2001], when a 'customer' or a 'Financial Institution' commits a 'default' in fulfilment of any obligation regarding any finance , then the 'Financial Institution' or, as the case may be, the 'customer', may institute a suit in the Banking Court by presenting a 'plaint' which needs to 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 authorised, by a power of attorney or otherwise. Apart from the aforesaid requisites, in terms of section 9 of F.I.O., 2001, the 'plaint' shall be supported by a 'statement of account' which in the case of a Financial Institution, shall be 'duly certified ' under the Bankers' Book Evidence Act, 1891 [Act No,XVIII of 1891], and accompanied with all other 'relevant documents' relating to the grant of finance. Moreover , in terms of subsection [2] of section 9 of F.I.O., 2001, copies of the 'plaint' , 'statement of account' and other 'relevant documents' are also needed to be filed along with plaint in the Banking Court in sufficient numbers i,e, one set for each Defendant and one extra set of copy[ies]. 21. The use of words 'the plaint shall be supported' preceding the words 'duly certified statement of account' in fact renders, the compliance of section 9 of F.I.O., 2001, as 'mandatory'. In case of 'non-compliance' of such essential requirements, as mentioned in section 9 of F.I.O., 2001, a plaintif f then, indeed, would be bound to A face the consequences. If the 'mandatory' ingredients/requirements in terms of section 9 of F.I.O., 2001 are either ignored and/or otherwise are not fulfilled then, of course, the Plaintif f is liable to face the consequences whatsoever it may be. On this aspect of the matter , reliance can be placed on the case of [i] Elbow Room and another v. MC Bank Limited [2014 CLD 985 D.B] and [ii] Banker's Equity Ltd. v. Bentonite Pakistan Limited and others [2003 CLD 931] wherein, respectively it was observed as follows:- [i] 2014 CLD 985 "7. ...The Legislature has used the word "supported" as employed in section 9(2) of Ordnance, 2001; which means that if the suit is not supported by the Statement of Account it would not be competent . The word "support" read in the mandatory perspective of the word "shall". makes the plaint filed by a financial institution, totally dependent upon duly certified statement of account on the "support" of which a plaint may stand and sustain as per section 9(1) and (2) of Ordinance, 2001......... " [Underlining is ours]. [ii] 2003 CLD 931 10.... definition and nature of term 'support' subsections (1) and (2) of section 9 of the Ordinance, 2001, can safely and logically be interpreted by holding that suit of a Banking Company cannot hold, endure, sustain, stand and be instituted without life support and founda tion of a duly certified Statement of Account and the said documents for the plaint, wherefor , non-compliance with express provisions of law bars a suit through a plaint unsupported by a Statement of Account duly certified under Bankers' Books Evidence Act, 1891 and the documents relating to grant of finance. 11. I am reinforced in my above opini on by the difference of phraseology used in provisions contained in subsections (1) and (2) of section 9 of the Financial Institutions (Recovery of Finances) Ordinance, 2001, and the provisions of Rules 14 and 17 of Order VII of C.P.C. Said rules 14 and 17 relate to production of documents in the Court…
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