' SYED HAMID ALI SHAH, J.---Brief facts giving rise to this appeal are that the name of appellant No,4 was changed on 11-10-1992 from Bakhsh Steel Mills (Pvt.) Limited to Goreja Steel Mills (Pvt.) Limited.
Appellant No, 4 under its previous name availed LC limit on DA basis, to the tune of Rs,40.000 (M) in the year 1991, which was secured by personal guarantees of the Directors and second charge on its assets, as the first charge on these assets was created in favour of I.D.B.P. The management of the appellant-Company was changed, as a result thereof appellants Nos.5 and 6, resigned as Directors and were replaced by appellants Nos.3 and 4, which fact is apparent from Form XXIX dated 17-5-1992. Appellants Nos.2 and 3, ever since the said change operated the accounts of appellant No,4. Respondent refused to renew the limit, conveyed the same to appellant No,4 through letter dated 17-1-1993 and outstanding amount pertaining to said limit stood fully adjusted.
The request of appellant No,4 for another limit of Rs,25.000 million was approved by the respondent on 13-3-1993, till 16-4- 1994. Another L.C. Limit on 90 days D.A. Basis was sanctioned and conveyed to the appellant No,4 through letter dated 31-7-1994. Appellant while availing this L.C. Limit, established eight letters of credit. The amounts, subject-matter of these letters of credit, were not repatriated, which gave cause to the respondent to create Force Finance (PAD) for an amount of Rs,16,363,413/50 for period from 10-7-1994 to 17-4-1995. Respondent after applying mark-up of Rs,6,706,033 and after adjusting the amount of repayment to the tune of Rs,610,000, demanded form appellant No,4 a sum of Rs,24,649,517.50. The respondent on failure of appellant No,4 to pay the outstanding amount, instituted the suit, in the Banking Tribunal for the said amount on 3-11- 1996. Appellants Nos.1 to 4 in response to notice, filed the reply to show cause under section 6(2) of the repealed Banking Tribunals Ordinance, 1984. The appellants denied the execution of letters of personal guarantee, asserted in their reply that amount paid or received through repatriation were not adjusted towards the liability and the stocks pledged with the Bank, which remained throughout in the possession of the Bank, are not available and as such Bank is not liable to recover the amount of loan against pledged stocks. Learned Banking Court refused to grant the appellants Nos.1 to 4, the leave to defend the suit, on the ground that availing of loan facility and non-liquidation of the loan, is admitted. Learned Court decreed the suit as prayed for, on the score that by dismissal of the application for leave to defend, the contents of the plaint stand established. The appellants have challenged decree dated 15-12-2000, in this appeal.
2. Learned counsel for the appellants has argued that the suit was filed on the basis of L.C. Limit of Rs,25.000 million, accorded to appellant No,4 through sanction letter dated 31-7-1993, at the time when the appellants Nos.5 and 6 were not the Directors of Company. The amount mentioned in letters of personal guarantee is Rs,40.000 million, which facility has already been adjusted. It was then argued that valuable stocks were lying in possession of the respondent as Pawnee and the respondent has neither adjusted the amount of pledged stocks nor returned the pledged stocks to the appellant, therefore the respondent is not entitled to recover the suit amount. The mark-up has been charged without any agreement and the claim of mark-up without any agreement is not sustainable.
3. Learned counsel for the respondent, on the other hand, has fully supported the impugned judgment and decree. Learned counsel has contended that availing of loan facility has not been denied nor the outstanding amount has been liquidated. The plaint is duly supported by the statement of account. Entries in statement of account are admissible in evidence and as such the Court has rightly decreed this suit. It was argued that appellants have failed to raise triable issues.
' Admittedly the facility was renewed and the appellant on renewal of facility are liable in their personal capacity. The stocks were misappropriated by the appellant and as per clause (4) of the letter of pledge the respondent is not responsible.
4. We have heard the learned counsel for the parties and perused the material available on the record. Appellants Nos.5 and 6 were residing abroad when notice in terms of section 6(2) of the Banking Tribunals Ordinance, 1984 (now repealed) were ordered. The Process Server reported that these appellants had left the address (29-T, LCCHS, Lahore). It has also been reported that one Malik Sohail now resides at the said address. The report by the postal authorities on registered A.D.
Was, that the addressee has left the premises. Learned Court after perusing this report was to proceed against appellants Nos.5 and 6 ex parte under Order IX, rule 6(a), C.P.C. Or it would have directed the second summons to be issued to the defendants under Order IX, rule 6(b). In case of the former action the Court was to decree the suit against appellants Nos. 5 and 6 on their failure to file reply to show-cause notice under section 6(2) of the Banking Tribunals Ordinance, 1984. The Court has not passed any specific order with regard to the non-appearance of appellants Nos.5 and 6 and non-submission of the reply to the show-cause notice. The Court was under an obligation to record due service before proceeding ex parte against appellants Nos.5 and 6, hence decree against appellants Nos.5 and 6 is not sustainable. It was obligatory on the Court, to apply the proper provisions of law which cannot be avoided and even if a party has not brought to the attention of the Court, the requirement of passing of an order, lapse is on the part of the Court: while holding so, we are fortified by the dictum of law laid down by the apex Court in the case of "Akbar and 2 others v. Abdul Ghafoor and 3 others" (2000 SCM R 1000).
5. The contesting defendants/appellants Nos.I to 4 moved two applications one under Order VII, rule 1 1 , C.P.C. And the other under section 176 of the Contract Act read with section 151, C.P.C. For furnishing the accounts of the pledged stock. Learned Banking Court decreed the suit without deciding the pending applications. The disposal of the suit without disposing the pending applications is violative of law, if any reference is needed the same can be made to 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 1695)
6. For the foregoing, the appeal in hand is accepted, the impugned judgment and decree dated 15- 12-2000 is set aside, the case is remanded to the Banking Court for passing an appropriate order qua non-appearance of appellants Nos.5 and 6 in response to the notice issued to them and for deciding the suit afresh, after disposing of the pending applications. No order as to costs.