1. C.M.A. No,8680 of 2005 ' MRS. QAISER IQBAL, J.---By this order, I propose to dispose of an application for leave to defend under section 10 of the Financial Institution (Recovery of Finances) Ordinance, 2001, filed by the defendant (hereinafter referred as Ordinance, 2001 for the sake of brevity) seeking unconditional leave to defend the suit.
2. ' The plaintiff has resorted to file the suit for redemption of mortgage under section 9 of the Ordinance, 2001, in respect of the Property bearing No, 21/I, Khayaban-e-Hafiz Ehamsheer, D.H.A., Phase-V, Karachi and had also claimed damages to the tune of Rs,50 Million on account of the acts and omissions on the part of the defendants. It is alleged that vide sanction letter, dated 30- 9-2004, the plaintiff had entered into an agreement for finance on mark-up basis for availing running finance facility amounting to Rs,10 Million, the rate of mark up was agreed to 55 paisas per 1000 per day. The plaintiff had executed the documents viz. Irrevocable General Power of Attorney, Finance Agreement and had also handed over a cheque, whereby the plaintiff was entitled to draw an amount maximum limit of Rs,10 Million for the purpose of smooth running of his business. The plaintiff had issued a cheque of Rs,20,00,000 from his running finance account granted by the defendant against equitable mortgage but he was shocked when the cheque tendered by him was dishonoured, which created embarrassment to the defendant, the matter was referred to the defendant-Bank but all in vain. It is alleged that on 12-10-2004, the plaintiff had issued an other cheque amounting to Rs,100,000 to Messrs EPLA in order to retire personal loan which too was not honoured by the ddendant. The plaintiff has resorted to file the suit as the defendant had failed to follow the terms of the agreement of finance, thereby, the plaintiff was not in a position to draw even a single penny from the defendant bank in lieu of the document mortgaged by him.
3. ' The defendant has resorted to file the application for leave to defend and raised legal issues about the maintainability of the suit. The learned counsel appearing for the defendant has contended that the plaintiff had contacted the defendant and expressed the desire to avail business from running finance facility in order to promote his business and had created the charge on his property, consequent thereupon, defendant obliged certain conditions in order to avail the facility, the objections were raised by the bank as the plaintiff had not provided permission to mortgage from the relevant authority, despite the several reminders issued by the defendant, the plaintiff failed to contact and supply the documents, thus the matter could not be finally settled, the defendant vide their letter, dated 29-4-2004 had informed the plaintiff, the basis for sanction of the facility and it was communicated that no binding contract would be constituted in the absence of documents and the defendant would be at liberty to withdraw the sanction without assigning any reason. The learned counsel appearing for the defendant has further contended that the plaintiff has proceeded to file a Suit No, 120 of 2005 for recovery of damages to the tune of Rs,60 Million against the ban based on the cause of action accrued to him in Suit No,329 of 2005, which is against the established law, resulted in the multiplicity of the two actions accrued on the basis of alleged finance facility extended by the defendant in favour of the plaintiff, thereby the plaintiff had played fraud upon the bank and both the suits filed by him are liable to be dismissed being misconceived and based upon the same line of facts, which are contrary to the record and contrary to the agreement arrived at between the parties at the initial stage, which had frustrated on account of the legal formalities not complied by the plaintiff during the course of transaction. It is next urged that non-fulfilment of the legal obligation on the part of the plaintiff required certain important findings, which are required to be adjudicated and investigated for the purpose of adjudication of the relief claimed by the plaintiff.
4. ' The learned counsel appearing for the plaintiff has drawn my attention to the section-11 of the Ordinance, 2001, and contended since not a single penny was disbursed to the plaintiff by the defendant, therefore, the mortgage created on the subject property of the plaintiff by the bank is liable to be redeemed, however, he has conceded to the effect that the matter of the quantum of the damages could only be investigated and finally adjudicated on the basis of the evidence, which shall be led in due course of time.
5. ' I have considered the arguments advanced at the bar.
6. The object of the Ordinance, 2001, is to provide expeditious remedy to the parties in dispute upon the banking affairs admittedly there has been an agreement between the parties about the finance facility, followed by the finance agreement, executed by the parties along with irrevocable general power of attorney, which resulted in exchange of letters between the parties and due to non-compliance of some of the legal formalities, the matter could not be finalized and the loan was not disbursed. The valuable rights of the defendant are involved, and required adjudication on the issue as to whether on account of acts and omission by the defendant, the plaintiff had sustained damages as claimed in the suit. In my humble view, defendants are entitled to the relief claimed unconditional leave to defend the suit is hereby allowed, the application under section 10 of the Ordinance, 2001, filed by the defendant is treated as written statement.
7. ' With the above observations, C.M.A. No, 8& 0 of 2005, is hereby allowed and parties are directed to file their draft issues.