' MIAN SAQIB NISAR, J.---This appeal as also the R.F.A. No,82 of 2003, arises out of the same judgment and decree dated 22-1-2003, thus are being disposed of together.
2. Briefly stated the facts of the case are, that the respondent-Bank has granted a finance facility to Muhammad Naeem Bhatti, the proprietor of defendant No,1, to the tune of Rs.61,63,700 and defendants Nos.2, to 4 (the appellants in other appeal), stood as the guarantors for the repayment of the finance, which was for the financing period of 2001-2002; furthermore, as a security, the guarantors along with Muhammad Naeem Bhatti, have mortgaged their shops bearing No,BU-7S- 37, situated in Ghalla Mandi, Hafizabad; this mortgage was created by the deposit of title documents, the execution of the memorandum of the deposit of title documents, and the execution of the registered mortgage deed. The finance was further secured by the hypothecation of certain paddy stocks, lying in the Godown of Messrs Mujaddad Rice Mills, owned by defendant No,2. On the night between 31-1-2001 and 1-1-2002, the fire broke in the Godown, where the hypothecated paddy stocks were lying and according to the appellants, Muhammad Kashif Rasheed, Stock Keeper of the Bank, reported the matter to the concerned police station and a F.I.R.
No,21 was got registered about the incident. It may be pertinent to mention here that there is no cavil between the parties that there is a clause in the finance agreement, through which the hypothecated paddy stocks was insured with the Pakistan General Insurance Company and in case of an accident/loss to the goods, the bank was entitled to satisfy its debts from the insurance claim. We are told that the respondent-Bank did invoke the said clause, but the claim was refused by the insurance company. Thereafter, another F.I.R. Was lodged, perhaps by the Insurance Company, challenging the bona fide of the fire incident.
3. Anyhow, finally, the borrower appellant brought a suit for recovery of its claim against the Insurance Company before the Civil Court. But it has been apprised by the learned counsel for the respondents, in the Court today, that the plaint has been returned by the learned Civil Judge, for presenting it before the competent forum, and the suit so far has not been reinstituted.
4. In the above background, the respondent-Bank instituted the present suit against the appellants of both the appeals; the principal borrower and the guarantors, filed their leave application, in which the stance taken is that the hypothecated paddy stocks were lying in the Godown of Mujadded Rice Mills, which was duly supervised and guarded by the Bank employee and thus on account of fire, coupled with the insurance of such good, the bank in view of the clause of the agreement, could only enforce its claim against the insurance company and not the defendants.
5. In the other appeal (R.F.A. No,82 of 2003), the appellants, who were impleaded as guarantors and are defendants Nos.3 and 4, they also took up the position that their brother defendant No,1, had mortgaged the jointly owned shop by virtue of the deposit of the title document and the execution of the memorandum for such deposit and signed the mortgage deed, but this was for the short term loan pertaining to the financing year 1999, which has been repaid and not for the subsequent financial year 2001-2002. Therefore, they were neither the guarantors nor the mortgagors of the latest finance; the leave applications of the appellants have been refused through the judgment and decree dated 22-1-2003. Hence these appeals.
6. Learned counsel for the appellants states that the recovery should have been made by invoking the mortgage clause and the appellants are not liable to pay the same, when the hypothecated goods have been destroyed due to fire and the insurance claim is due to the bank. It is also submitted that because of the fire, which is an Act of God, the principal borrower stands exonerated from the liability and thus the other defendants/appellants also are discharged as surety /mortgagors. It is further contended that the appellants in R.F.A. No,82 of 2003, never stood as guarantors/mortgagors, for the financing year 2001-2002.
7. Responding to the above, learned counsel for the respondents has placed reliance upon the judgments reported as Messrs United Bank Limited v. Messrs Adamjee Insurance Company Ltd.
1988 CLC 1660 and Messrs Agro Food Limited through Chief Executive and 4 others v. Agricultural Development Bank of Pakistan through Manager 2002 CLC 1290, to argue that the claim under the insurance clause is an independent and separate agreement, which cannot be made the basis to restrict the bank to recover the amount, only through the said process, especially when the insurance company has refused to pay the insurance claim on the ground that the incident of fire is a manoeuvred one and the claim is not bona fide.
8. We have heard learned counsel for the parties. As for the submission that the bank should have enforced the mortgage clause, suffice it to say that no law or the agreement between the parties, requires that to be essentially done. Notwithstanding the insurance and the mortgage clause, obviously, the bank in the light of the judgments referred to above, was entitled to independently enforce the finance agreement, rather than seeking the amount from the insurance company, particularly, in the situation, when the company has doubted about the incident and bona fide of the claim. We also do not find any force in the submission that because of the Act of God, the principal borrower is exonerated from the liability and thus the other defendants/appellants in the other appeal, stand discharged as sureties/mortgagors. The submission by the appellants in R.F.A.
No,82 of 2003, that they never stood as guarantors/mortgagors, for the present finance, as the above document pertains to the financing year 1999, is repelled and controverted by the documents available on the record duly executed by them and the argument is bald and baseless.
It is established that for each finance, which was obtained by the principal borrower, they remained to be the guarantors and the mortgagors of the same.
' In the light of above, we do not find that any case for grant of leave has been made out by the appellants and therefore, these appeals have no merit and the same are hereby dismissed.