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Official Citation: 2026 IHC 248817
Court / Jurisdiction: Islamabad High Court
Parties: M/s United Bank Limited vs President of Islamic Republic of Pakistan
Ruling Summary: This decision was rendered by the Islamabad High Court, officially reported as 2026 IHC 248817. In this matter between M/s United Bank Limited and President of Islamic Republic of Pakistan, 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.
COURT: Islamabad High Court (Honourable Ms. Justice Saman Rafat Imtiaz) AUTHOR JUDGE: Honourable Ms. Justice Saman Rafat Imtiaz DECISION DATE: 30-JAN-2026 CASE NO: Writ Petition-3464-2022 CITATION: 2026 IHC 248817 PARTIES: M/s United Bank Limited VS President of Islamic Republic of Pakistan LAW / SECTION: under Section 55 of the PSEFT Act | under Clause (iv) of the State Bank of Pakistan's (“SBP”) PSD Circular No.09 of 2018.| under Section 30 and 41 of the said Act SUBJECT: Miscelleneous, Other REMARKS: The Bank, UBL impugns the order by Mohtasib Banking and by President's office wherein while allowing the complaint of a customer, Bank directed to make good the loss of the customer, he lost owing to a fraud call. ============================================================ JUDGMENT SHEET
IN THE ISLAMABAD HIGH COURT, ISLAMABAD (JUDICIAL DEPARTMENT)
W.P. No. 3464 of 2022
United Bank Limited Vs. The President of the Islamic Republic of Pakistan, etc.
Petitioners by : Malik Muhammad Siddique Awan Advocate for the Petitioners in W.P. Nos. 3464/22, 3465/22, 3466/22, 1844/23, 1843/23, 1844/23, 1927/23, 2883/23, 3374/23, 368/24, and 369/24. M/s Ahmed Bashir and Aziz -ur-Rehman Farooqi Advocates for the Petitioners in W.P. No. 2062/21, 4636/21, 4637/21, 1192/22, 1239/22, and 1239/24. M/s Wasim Abid and Muhammad Ahmad, Advocates for the Petitioner in W.P. No. 4279/2023. Barrister Abdul Wahab Khan for the Petitioner in W.P. No. 3556 of 2024.
Respondents by : Mr. Imran Farooq, Assistant Attorney General. Mr. Sajjad Hameed, Advocate for the Respondent No. 3 in W.P. No. 3464/2022. Syed Mumtaz Mazhar Naqvi, Advocate for the Respondent No.4 in W.P. No.4637/2021. Ch. Muhammad Atif, Advocate for the Respondent No. 3 in W.P. No. 3466/2022. Mr. Asad Ladha, Advocate for the Respondent No. 3 in W.P. No. 369/2024. Barrister Malik Talha Ahmed Rahim for the Respondent No. 3 in W.P. No. 2883/2023. Mr. Muhammad Gul Aftab Abbasi, Advocate for the Respondent No. 3 in W.P. No. 4279/2023. Mr. Shahzad Hameed, Advocate for the Respondent
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SAMAN RAFAT IMTIAZ, J.- 1. The instant Petition is being decided along with the Petitions listed in the Annexure hereto by way of this consolidated judgment as common questions of facts and law are involved. 2. The Petitioners are „banking companies‟ as per the meaning ascribed to the term in the Banking Companies Ordinance, 1962 (“Banking Companies Ordinance”) whereas the Respondents No. 2/3/4 as impleaded in the petitions (hereinafter referred to as the “Complainants”) are account holders/customers/consumers who moved complaints before the Banking Mohtasib, Pakistan (“Banking Mohtasib”) against their respective Petitioners/Banks disowning certain transactions made from their accounts alleging them to be fraudulent or unauthorized. 3. In W.P. Nos. 2062 of 2021, 4636 of 2021, 4637 of 2021, 1192 of 2022, 1239 of 2022, 3464 of 2022, 3465 of 2022, 3466 of 2022, 1843 of 2023, 1844 of 2023, 1927 of 2023, 2696 of 2023, 2883 of 2023, 4279 of 2023, 3556 of 2024 the Banking Mohtasib allowed the Complaints of the No. 3 in W.P. No. 368/2024. Mr. M. Jalal Haider, Advocate for the Respondent No. 4 in W.P. No. 1239 of 2022. Mr. Sher Hamad Khan, Advocate fo r the Respondent No. 3 in W.P. No. 1844 of 2023. Mr. Hawad Jgyrsgud, Advocate for the Respondent No. 3 in W.P. No. 3374 of 2023. Complainants Ali Ghulam, Hidayat Ullah and Waqar Ahmed in W.P. No. 4636/2021, 1927/2023 and 1192/2022, respectively, in person . None is in attendance on behalf of the Respondents in W .P. No.2696 of 2023.
Date of Hearing : 08-1-2026.
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respective Complainants vide Orders (the dates of which are given in the Annexure and which collectively are hereinafter referred to as the “Impugned Orders I” ) advising the respective Petitioners/Banks to make good the loss of the Complainants by crediting their accounts with the relevant amounts. The Petitioners/Banks filed Representations against the Impugned Orders I before the President of the Islamic Republic of Pakistan (“President”) which have been dismissed vide the President‟s Orders ( the dates of which are given in the Annexure an d which collectively are hereinafter referred to as the “Impugned Order s II”). The Petitioners/Banks have assailed both the Impugned Orders I and II in the aforementioned writ petitions. 4. In W.P. Nos. 3374 of 2023; 368 of 2024; 369 of 2024; and 1239 of 2024 the Banking Mohtasib closed the Complaints of the Complainants either wholly or partially vide Orders ( the dates of which are given in the Annexure and which collectively are hereinafter referred to as “Orders III”). The Complainants filed Represen tations against such Orders III before the President which have been allowed vide the President‟s Orders (the dates of which are given in the Annexure and which collectively are hereinafter referred to as the “Impugned Orders IV” ) with a direction to the Banks to make go od the loss and pay the relevant amounts to the Complainants. The Petitioners/Banks have challenge d the said Impugned Orders IV in the aforementioned writ petitions. 5. The Respondent No. 5/ Federal Investigation Agency (“FIA”) in W.P. Nos. 4636 of 2021, 1192 of 2022, and 1239 of 2022 did not appear despite service therefore, the matter proceeded against them ex-parte. Nature of Complaints 6. The Complainants in W.P. Nos. 4636 of 2021;1239 of 2022; 3464 of 2022; 3466 of 2022; 1843 of 2023; 1844 of 2023; 2696 of 2023; 3374 of 2023; and 369 of 2024 filed C omplaints before the Banking Mohtasib
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alleging that transactions were made fraudulently from their bank accounts following disclosure of personal credentials admittedly made by such Complainants to unknown callers who extended threats while personating to be bank officials/army officers and in some cases had called from the concerned bank‟s official number resulting in loss/damage of amounts. 7. The Complainants in W.P. Nos. 2883 of 2023 and 1239 of 2024 made similar allegations about receiving calls from unknown numbers demanding personal information but expressly denied disclosing personal credentials to the unknown callers. The Complainants in W.P. Nos. 2062 of 2021; 1192 of 2022; and 3465 of 2022 also made the same allegations but without making any specific statement as to whether personal credentials were disclosed by them or not to the unknown callers. 8. The Complainants in W.P. Nos. 4637 of 2021; 1927 of 2023; 4279 of 2023, 368 of 2024 ; and 3556 of 2024 simply alleged unauthorized Electronic Fund Transfers that were discovered in various circumstances without making any allegations regarding unknown callers. Maintainability 9. At the very outset, t he learned counsel for the Complainant [Muhammad Yousaf ] in W .P. No. 3464 of 2022 objected to the maintainability of the instant Petition on account of laches by highlighting that the Impugned Order II passed in this case is dated 10-3-2022 whereas the petition has been filed on 20 -9-2022. The learned counsel for the Complainant argued that the Supreme Court in Settlement Authority through the Chief Settlement Commissioner Vs. Mst. Akhtar Sultana , PLD 1976 SC 410 has held the reasonable time for filing of Constitutional petitions to be 90 days. Therefore, he argued that the petition is liable to be dismissed as not maintainable.
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10. In his counter arguments , t he learned counsel for the Petitioner/United Bank Limited (“UBL”) in W.P. No. 3464 of 2022 argued that there is no laches as the Petition was filed on 05 -7-2022 but remained pending in the office. 11. Similarly, the learned counsel for the Complainant in W.P. No. 3466 of 2022 [Raja Khalil-ur-Rehman] submitted that the Petitioner/UBL has not explained laches of eight months. Arguments on the point of Jurisdiction W.P. Nos. 3464 of 2022, 3465 of 2022, 3466 of 2022, 1843 of 2023, 1844 of 2023, 1927 of 2023, 2883 of 2023, 3374 of 2023, 368 of 2 024, 369 of 2024: 12. Mr. Malik Muhammad Siddique Awan , the learned counsel for the Petitioner/UBL pointed out that admittedly the Complainant s [M/s Muhammad Youssef ; Raja Khalil -ur-Rehman; Muhammad Saud; Gulzar Hussain; Malik Salimullah Khan Awan; and Ms. Farida Bashir] in some of the above -captioned Petitions shared their personal identification details with unknown caller s which led to the disputed payments through Interbank Fund Transfers (“IBFT”). The learned counsel argued that under Section 40 of the Payment Systems and Electronic Fund Transfers Act, 2007 (“PSEFT Act ”) it is the consumer who is liable for any unauthorized Electronic Fund Transfers. In this regard, he also relied upon the Indemnity and Undertaking given by customers as part of their account opening form whereby the account -holder/customer/consumer is lia ble to keep his/her/its Personal Identification Number confidential and for any misuse of the same and indemnifies the bank against consequences of such misuse and accepts full r esponsibility for all transactions made by the use of cards, cheque books, net banking facility, etc., whether or not made with the account -holder/customer/consumer‟s knowledge or authority . The learned counsel submitted that in any event under Section 55 of the PSEFT Act jurisdiction for any civil action under the said Act lies with a Civil
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Court of competent jurisdiction and as such argued that the Banking Mohtasib had no jurisdiction to entertain the Complaints. 13. He further argued that the Complaints had not been filed to complain about the bank‟s failure to conduct biometric yet the Petitioner/UBL has been held liable to compensate the Complainants by the Impugned Orders I and II due to such failure at the time of installation /reinstallation of the mobile banking application as required under Clause (iv) of the State Bank of Pakistan‟s (“SBP”) PSD Circular No.09 of 2018. 14. On the other hand, the learned counsel for the Complainant [Muhammad Yousaf] in W.P. No. 3464 of 2022 denied that any credentials were shared by the Complainant in this case. He submitted that the Banking Mohtasib has jurisdiction to deal with complaints regarding „maladministration‟ on the part of banks under the Banking Companies Ordinance. He contended that since the Petitioner/UBL failed to conduct the biometric of the Complainant at the time of installation/reinstallation of the mobile banking application the Complainant was not informed/educated about unauthorized transactions and various types of fraud which are prevalent these days. He argued that had the Complainant been educated by the Petitioner/UBL in the manner as prescribed under the aforementioned SBP Circular the Complainant would not have shared his personal details with an unknown caller . As such he contended that this matter pertains to „maladministration‟ which squarely falls within the jurisdiction of the learned Banking Mohtasib and not under the PSEFT Act. He relied on Habib Bank Ltd vs. Federation of Pakistan 2018 CLD 1152 , whereby this Court upheld the decision of the Banking Mohtasib where the bank failed to implement the directions of the SBP. The learned counsel for the Complainant further argued that the contents of the Complaint to the Banking Mohtasib clearly show that the implication was violation of the SBP Circular and that for the said purpose the pith and substance of the complaint must be taken into consideration. In this regard, he relied upon
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Haji Abdul Malik and 10 others vs. Muhammad Anwar Kh an, 2003 SCMR 990. 15. He also relied upon Muslim Commercial Bank Ltd vs. Federation of Pakistan, 2020 CLD 829,whereby it was held that Section 50 and 55 of the PSEFT Act and Section 82A of the Banking Companies Ordinance are not inconsistent with each other and one does not exclude the other. He contended that Section 40 of the said PSEFT Act cannot be read in isolation and the liability on the part of the customer does not arise till such time that the bank has discharged its burden under Section 30 and 41 of the said Act which was not done in the instant case. Lastly, he submitted that under Section 82 -B the Banking Mohtasib has the powe r to receive evidence by way of affidavit. 16. In rebuttal, the learned counsel for the Petitioner/UBL argued that the cases of alleged fraudulent transactions where the customers have admittedly disclosed his/her personal details to unknown callers are n ot cases of mal -administration of the Bank and that none of these cases involve any failure on the part of the Petitioner /UBL. Insofar as denial on behalf of the customers is concerned about disclosure no evidence was recorded by the Banking Mohtasib to give findings as to whether or not the customer had disclosed his/her details to any third party or not. He pointed out that no mala fide has been attributed to the Banks by any of the Complainants. W.P No. 2883 of 2023: 17. The learned counsel for the Complainant [Muhammad Rafiq] in 2883 of 2023 drew the Court‟s attention to Section 82 -B(5)(iii), whereby the Banking Mohtasib is empowered to entertain complaints regarding fraudulent or unauthorized withdrawals or debit entries in accounts. He also stressed that the customers in all the instant Petitions are either illiterate or have limited education.
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W.P. No. 4279 of 2023: 18. Mr. Mohammad Ahmed Advocate, the learned counsel for the Petitioner/UBL in W.P. No. 4279 of 2023 high lighted that the Complainant [Khalid Mehmood] in his Complaint to the Banking Mohtasib alleged misappropriation by the bank staff or someone in connivance with them. In view thereof, he submitted that the Complainant‟s Complaint falls within the ambit of the Offence s in respect of Banks (Special Courts) Ordinance, 1984 (“the Offences in respect of Banks (Special Courts) Ordinance”) where under Special Courts have been established to try scheduled offences, including the offences under Sections 403, 409, and 420, PPC. He also submitted that the Special Court is empowered under Section 6 of th e Offences in respect of Banks (Special Courts) Ordinance to pass a sentence or fine which shall not be less than twice the specified amount in respect of which the offence has been committed. The learned counsel for the Petitioner/UBL withdrew the prayer challenging the vires of various provisions of the Banking Companies Ordinance as well as of the Federal Ombudsman Institutional Reforms Act, 2013. 19. In re ply, t he learned counsel for the Complainant argued that the Banking Mohtasib has jurisdiction in the matter in view of Sections 82-A and 82-B which are still on the statute books and have not been repealed notwithstanding any other law . He pointed out that under Section 82 - B(4)(c) and (d) the Banking Mohtasib has powers to receive evidence on Affidavit and to issue commission for the examination of witnesses. 20. In rebuttal , the learned counsel for the Petitioner/UBL relied upon United Bank Limited vs. Federation of Pakistan, PLD 2018 Lahore 322 in which the Lahore High Court held that the Banking Mohtasib cannot give binding decisions on complaints involving disputed question s of facts by resorting to the provisions contained in Sections 82 -B and 82 -E as the Banking Mohtasib is not a Court. He s ubmitted that the said decision was
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followed in Habib Bank Limited vs. Federation of Pakistan, 2022 CLD 769 and by this Court in Saleem Ahmed Jan vs. Deputy Commissioner, Islamabad and other 2024 CLC 953. He contended that the said decisions are in consona nce with Shafaatullah Qureshi vs. Federation of Pakistan PLD 2001 Supreme Court 142 , whereby the Supreme Court of Pakistan held that the office of Wafaqi Mohtasib is not a Court. Lastly , he relied upon MD/CEO United Insurance Company of Pakistan Limited, Lahore vs. The President of the Islamic Republic of Pakistan, 2024 CLD 931 in which this Court on similar arguments decided that since the controversy involved disputed questions of facts, requiring recording of evidence the Insurance Ombudsman had no jurisdiction. W.P. No. 3556 of 2024: 21. The learned counsel for the Petitioner /Bank Alfalah Limited (“BAHL”) submitted that PSEFT Act is a special law and therefore shall prevail. Arguments on merits W.P. Nos. 2062 of 2021, 4636 of 201, 4637 of 2021, 1192 of 2022, 1239 of 2022, 1239 of 2024: 22. The learned counsel for the Petitioner/Habib Bank Limited (“HBL”) in the above -captioned Petitions submitted that the Banks are in compliance with the applicable laws as well as SBP‟s directions and circulars which is evident from the fact that the SBP being the regulator has not objected regarding non -compliance and in such circumstances the Banking Mohtasib does not have authority to give a findin g of mal - administration. He referred to Section 77 of the Banking Companies Ordinance and relied upon Section 82 -(E) viz-a-viz that the Banking Mohtasib should have referred the matter to the SBP.
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W.P. Nos. 3464 of 2022, 3465 of 2022, 3466 of 2022, 1843 of 2023, 1844 of 2023, 2883 of 2023, 3374 of 2023, 368 of 2024, 369 of 2024: 23. Mr. Malik Muhammad Siddique Awan, Advocate, who is the learned counsel for the Petitioner /UBL submitted that the customers never approached FIA. Had the FIA been contacted by the Complainant in W.P. No. 3464 of 2022 [Muhammad Yousaf ], FIA could have identified the person whose utility bills were paid as the alleged fraudulent transactions in this case were conducted to make payment towa rds utility bills. He also submitted that a call log of the mobile number of the Complainant shows that text messages were sent by the Petitioner/UBL to the customer repeatedly informing him of the transactions condu cted by the Complainant despite which the Complainant did not timely inform the Petitioner/UBL that some of those transactions were allegedly unauthorized/ fraudulent. 24. The learned counsel for the Complainant in W.P. No. 3466 of 2022 [Raja Khalil -ur-Rehman] submitted that although the amount transferred without authorization has been identified in an account of an individual held with Faysal Bank Limited but no effort has been made to recover Rs. 350,000/- out of the total amount transferred. 25. The learned counsel for the Complainant [Muhammad Rafiq] in W.P. No. 2883 of 2023 highlighted that in this case the Complainant did not share information with any one. He referred to the Account Opening Form to submit that it is in fact a photo account. The Complainant never asked for an ATM Card without which the mobile banking application was activated without request/consent of the Complainant. He pointed out that the Complainant is an illiterate and elderly man and that twenty transactions were made on t he same date but no effort was made by the Bank to take action on account of suspicious activity.
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W.P. No. 1927 of 2023: 26. The Complainant [Mr. Hidayaullah] in W.P. No. 1927 of 2023 appeared in person and highlighted that an official number was used t o call the Complainant. 27. In rebuttal, Mr. Ahmed Bashir Advocate for the Petitioner/UBL in W.P. No. 1927 of 2023 submitted that the official number was not used but number similar to the official number was used and that the Bank regularly informs its customer that even official number is not used to obtain personal information of the customers. W.P. No. 4279 of 2023: 28. Mr. Mohammad Ahmed Advocate , the learned counsel for the Petitioner/UBL in W.P. No. 4279 of 2023 argued that the Banking Mohtasib travelled outside the scope of the Complaint filed by the Complainant [Mr. Khalid Mahmood ]. He submitted that the Complaint contained an assertion that the disputed transactions were carried out by using an ATM card which was never issued to him. On the other hand the Impugned Order I passed by the Banking Mohtasib in this case is on the basis that the Complainant‟s stance is that he is not a digital banking user. The learned counsel clarified that although the SBP had through PSD Circular No.09 of 2018 dated 28 -11-2018 directed all banks to conduct biometric of the customers desirous of using internet banking however the said requirement was relaxed in view of Covi d-19 by way of PSD Circular No. 02 of 2020 dated 18-03-2020 nevertheless customer authentication and verification was required using appropriate measures. He submitted that authentication and verification was conducted on the phone which was duly recorded. According to him although the Petitioner/UBL had provided the call record by way of an e -mail attachment as evident from the e -mail exchange between the Petitioner/UBL and the office of the Ombudsman from 16-9-2022 to 26 -9-2022 such call recording has n ot been considered
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by the Banking Mohtasib at all as is evident from the Impugned Order I. Thus, the findings of the learned Banking Mohtasib by way of the Impugned Order I passed in this case finding that the IBFT channels were activated without obtainin g the Complainant‟s consent is against the record. 29. He argued that the Impugned Order I has been passed in violation of Sections 82-B(5)(c) and 82 -D(4) of the Banking Companies Ordinance as the Complainant after filing the Complaint before the learned Banking Mohtasib also instituted proceedings before the learned Consumer Court which were decided by way of Order dated 02 -09-2022 which was prior to the Impugned Order I passed by the learned Banking Mohtasib and as such operated as res judicata . He has further pointed out that the Complaint filed by the Complainant before the Consumer Court contained a misrepresentation that the Banking Mohtasib could not do much despite the fact that the Complaint was pending before the learned Banking Mohtasib. Similarly, he has pointed out that the Certificate given in the Complaint form before the Banking Mohtasib that there are no legal proceedings decided by any other forum was incorrect as the learned Banking Mohtasib was not informed when proceedings before the Consumer Court were instituted subsequently. The learned counsel argued that the fact that the impugned transactions were conducted using internet banking and not through an ATM was established through the account statement of the Complainant which reflects that the impugned transactions conducted between 01 -07-2020 and 02 -7-2020 were made through IBFT fund transfers. He submit ted that the said accounts statements were also provided by e -mail dated 26 -9-2022 in response to the e -mail received from the Banking Mohtasib‟s Office dated 16 -9-2022 asking for such material but have been disregarded. 30. In his counter arguments, t he learned counsel for the Complainant pointed out that multiple transactions were made on the same date of the
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same amount and yet the Bank intimated the customer on the next date with a considerable delay. W.P. No. 3556 of 2024: 31. The learned counsel for the Petitioner /Bank Alfalah Limited (“BAHL”) highlighted that in the instant case the Complainant [Ms. Hira Amjad] admitted that she is an educated person and yet the Banking Mohtasib has decided the matter against the Petitioner/BAHL despite the fact that it stands established that the Petitioner/BAHL has done its due diligence in educating the customers despite which if the customers chose to disclose his/her details to an unauthoriz ed person the Bank c annot be held responsible. He submitted that the Banking Mohtasib clearly exceeded his jurisdiction as he has also given a finding with regard to a loan obtained by the Complainant in respect of which only the Banking Court under the Financial Institutions (Recovery of Finances) Ordinance, 2001 has jurisdiction. 32. Since the questions raised in the instant matters require interpretation of the Constitution and the laws, notice under Order XXVII -A, CPC was issued to the Attorney Genera l for Pakistan in response to which he has filed written arguments on 21-1-2026 through the Assistant Attorney General expounding on the difference between judicial and quasi -judicial powers and the evolution of quasi-judicial forums. 33. I have heard the learned counsel for the contesting parties and have also perused the record. Jurisdiction of the Banking Mohtasib under the Banking Companies Ordinance…
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