Appellant/plaintiff, through the filing of the instant first appeal, under section 21 of the Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997 (hereinafter referred to as Act) has called in question judgment and decree dated 30-6-1999, whereby the learned Judge Banking Court dismissed appellant's suit for recovery.
2. Facts leading to the filing of the -present appeal are that the appellant filed the suit for the recovery of Rs.92,00,000 as damages. The respondent-Bank filed the application, seeking leave to defend the suit, which was resisted by the appellant. The learned Judge Banking Court, without deciding the said application, either way, proceeded to dismiss the suit in view of the principle of res judicata, vide impugned judgment and decree dated 30-6-1999, hence the present appeal.
3. Learned counsel for the appellant has contended that the learned Judge Banking Court, while hearing the application for leave to defend the suit, could not dismiss appellant's suit and thus the provision of section 10 of the Act XV of 1997 has been violated. Conversely, the learned counsel for the respondent has supported the impugned judgment and submitted that as the suit, filed by the respondent, was decreed, therefore, the natural consequence of it was to dismiss appellant's suit.
4. In view of the arguments of the learned counsel, we have examined the available record, perused the impugned judgment and find that although the respondent-Bank filed the application, seeking leave to defend the suit, yet the same was not decided by the learned Banking Court, either way. Under the law, the learned Banking Court was obliged to decide the leave application on its own merits before embarking upon the suit. If the learned Banking Court was of the view that the substantial questions of law and facts were raised by the respondent-Bank, then at best leave to defend could have been granted to the respondent-Bank, but in, no way, at that point of time, the suit could have been dismissed.
The impugned judgment is violative of the law laid down by this Court in the cases of Messrs Waheed Corporation through Proprietor and another v. Allied Bank of Pakistan through Manager 2003 CLD 245 and Sheikh Muhammad Kashif v. Askari Leasing Limited through Manager/Chief Executive of Branch/Recovery Officer 2004 CLD 1645.
5. Placing the afore-narrated facts in juxta position with the provisions of section 10 of Act, 1997, it is evident that the learned Banking Court did not adopt the procedure, as prescribed in the said statute and has, in fact, gone outside the scope of section 10 of Act, 1997. Admittedly, the respondent-Bank filed the application seeking leave to defend the suit but the learned Banking Court without deciding the application, dismissed the suit. The impugned judgment is thus violative of said provisions of law, as the learned Banking Court has completely bypassed the procedure of Banking Courts, as noted above.
6. In the above perspective, we have examined the impugned judgment and find that the same is not sustainable in law, inasmuch as the same is violative of law laid down in the aforesaid two cases, thus we are inclined to set it aside.
7. Upshot of the above discussion is that the present appeal is allowed and the impugned judgment and decree dated 30-6-1999 is set aside with no order as to costs. Resultantly appellant's suit titled "Muhammad Shahid Saigol v. Al-Towfeek Investment Bank Ltd." and respondent-Bank's application for leave to defend the suit, shall be deemed to be pending before the learned Judge Banking Court, which shall decide firstly the said application and thereafter the suit, after hearing the parties and of course in accordance with law.