MIAN HAMID FAROOQ, J.---Present appeal proceeds against the judgment and decree dated 8- 12-2000, whereby the learned Judge Banking Court rejected the plaint in appellant's suit for declaration with permanent injunction.
2. Facts in brief are that the appellant/plaintiff filed the suit for declaration with consequential relief of injunction, against the respondents, before the learned Judge Banking Court, inter alia, pleading that respondent No.3 availed the loan facility of Rs.2,75,000, from the respondent No.2; in consideration thereof certain properties were mortgaged and the appellant stood as surety. It was further asserted that respondent No.3 was arrested and was released on making partial payment of Rs.21,000, with the assurance to liquidate the remaining amount within a fortnight. In nutshell, the grievance of the appellant was that as respondent No.3 has utilized the loan amount and the appellant is not the beneficiary, therefore, the same may be recovered from him by auctioning the mortgaged properties. On the presentation of plaint, the learned Judge Banking Court issued summons to the respondents, as prescribed under the relevant law, and pursuant thereto they filed separate applications, seeking leave to defend the suit. Both the applications were allowed on 7-7- 2000, on the concession rendered by the learned counsel for the appellant, and the respondents were granted leave to defend the suit. The respondents filed the written statements. Respondents Nos.1 and 2, later on, filed the application under Order VII, rule 11, C.P.C., for the rejection of the plaint. which was resisted by the appellant and the learned Judge Banking Court, after hearing the parties, proceeded to reject the plaint in appellant's suit, vide impugned judgment and decree dated 8-12-2000, hence the present appeal.
3. Learned counsel for the appellant, while admitting the claim of the respondent-Corporation, against the respondent No.3, has submitted that the dispute between the guarantor (appellant) and the loanee (respondent No.3) has not been decided by the learned Banking Court, which has rendered a non-speaking judgment. Conversely, the learned counsel for the respondent has submitted that since the appellant was guarantor, therefore, his liability is co-extensive with that of the principal debtor, as per section 128 of the Contract Act. He has relied upon Rafique Hazquel Masih v. Bank Alfalah Lt d. and others 2005 SCM R 72.
4. We have heard the learned counsel for the parties and examined the summoned record. Even according to own showings of the appellant, the loan facility of Rs.2,75,000 was availed by respondent No.3 and in addition to furnishing other securities, the appellant also stood as surety/guarantor. It is also admitted that neither the principal debtor nor the surety has liquidated the outstanding dues of the corporation and that some amount is outstanding against respondent No.3. for the recovery of which respondent-Corporation is making some efforts. It is settled law that in view of section 128 of the Contract Act, liability of surety is co-extensive with that of the principal debtor unless it was otherwise provided in the Contract. As noted above, undisputedly the loan was granted against certain securities including the surety/guarantee furnished by the appellant. The admitted fact that the appellant was a guarantor/surety provides a sufficient lever in the hands of the respondent-Corporation to initiate recovery proceedings against him as well. Even the guarantor falls within the definition of customer, as given in section 2(c) of Financial Institutions (Recovery of Finances) Ordinance (XLVI of 2001). The learned counsel for the respondent has rightly relied upon the case of Rafique Hazquel Masih (ibid), the principles of law laid down therein are completely applicable to the facts and circumstances of the case in hand.
5. In the above perspective, we have examination the impugned judgment and decree and find that the sane not suffer from any legal error, thus, the same do not call for any interference by this Court. We are inclined to maintain the same.
6. Upshot of the above discussion is that the present appeal is devoid of merits, hence the same stands dismissed with no order as to costs.