ANWAR ZAHEER JAMALL ' J.---By this appeal under section 22 of the Financial Institutions (Recovery of Finances) Ordinance, 2001, order dated 2-6-2006, passed by learned Single Judge of this Court, in Execution Application No.58 of 2000, thereby dismissing appellants' two miscellaneous applications, C.M.As. Nos.536 of 2003 and 1230 of 2004, has been challenged by the appellants.
2. In the first application, C.M.A. No.536 of 2003 dated 10-3-2003, which is supported with the affidavit of appellant No.3, the appellants/JDs have stated as under:- "(1) That the State Bank of Pakistan has issued a Scheme, whereby certain guidelines have been given to the Banks for the recovery of their outstanding amounts, which will expire on 14-4-2003, photocopy whereof is enclosed herewith.
(2) That JDs have already deposited about Rs.50.5 Million by selling the mortgaged properties and share, which is more than the principal decretal amount of Rs.40,428,470 by consent of the DH Bank.
(3) That recently when the JD-3 visited the Nazir of this Honourable Court to inform him that JDs want to avail the aforesaid State Bank's Scheme, it transpired that the Law Officer of CIRC vide his letter dated 13-8-2002 has informed the Nazir that he has received an offer of Rs.10.3 Million from one Mst. Salma Chishti in respect of Bungalow/Property No.C-33-34 Block-4, Clifton, Karachi. It is submitted that JDs have never been issued any notice in respect of said offer. The JDs should have been given an opportunity to bring a higher offer. Any action taken or proceedings held behind the back of JDs being against the principle of natural justice are void and of no legal effect. The said property has current market value of around 20 Million. Photocopies of three (3) valuation certificates are enclosed herewith.
(4) That the JDs have a buyer who is ready to purchase the said property for a sum of Rs.11.5 Million.
Therefore, the Nazir may be directed to allow the JD No.3 to submit the said offer of Rs.11.5 Million in respect of her Bungalow No.C-33-34 block No.4, Clifton, Karachi and this Honourable Court may be pleased to pass any other, further orders in the interest of justice and to prevent the abuse of the process of the Court by CIRC."
3. In the other application, C.M. A. No.1230 of 2003, dated 20-5-2004, the Judgment-debtor No.2 has stated and prayed as under:-- "(I) That Judgment-debtor No.2 has been suffering from various aliment for the last about two years, which failed to work and is presently on dialysis. He is also suffering from urinary track cancer and has been receiving treatment by Chemotherapy. He has been confined to bed on account of these serious ailments. In view of this factual position, the Judgment-debtor No.2 was quite out off from the aforesaid Proceedings.
(Copies of medical papers including test reports are filed herewith).
(2) That recently, some how, he came to know that his Bungalow viz. Property No.C-33 and C-34, Block-4, Clifton, Karachi, is being sold out, in the above execution proceedings, to the highest bidder at Rs.11.5 Million. It is submitted that the property on Plots Nos.C-33 and C-34, Block-4, Clifton, Karachi, is being sold at a price, below the market value.
(3) That the decree-holder has already received a sum of Rs.50.500 Million by sale of the mortgaged properties and shares which is substantially more than the principles amount of Rs.40,428,470.
(4) That despite the recovery of Rs.50.500 Million by the decree-holder, the liabilities are still outstanding and even after the sale of the Properties bearing Nos.C-33 and C-34, Clifton, Karachi, at a price of Rs.11.5 Million, the decree will not be satisfied.
(5) That in order to satisfy the decree and obtain a better price, the J.D. No.2 negotiated with a party, who is prepared to purchase the Properties bearing Nos.C-33 and C-34, Block-4, Clifton, Karachi, at a price of Rs.12.5 Million.
(6) It is, therefore, prayed that in the interest of justice, equity and good conscience the aforesaid property may kindly be allowed to be sold out to the New buyer at the matching price of Rs.12.5 Million."
4. After submission of the reply to both these applications in the form of counter affidavits and filing of its rejoinders by the appellants' side, the learned Single Judge had passed the impugned order, whereby both the applications were dismissed, having been found without merits.
5. Mr. Badar Alam,- learned counsel for appellants, has vehemently contended that the perusal of the contents of 'two miscellaneous applications, under section 151, C.P.C., clearly goes to show that in a deceitful and fraudulent manner, behind the back of the appellants, who were the main contesting parties to the proceedings, their two mortgaged Properties, bearing Nos. C-33 and C- 34, Block 4, Scheme No.5, Clifton, Karachi, (admeasuring 596 Sq. Yds, each with covered area of 6300 Sq. Ft.) were sold by the CIRC to the respondent No.3 at a throw-away price of Rs.10.3 million only. He contended that the judgment-debtors, when acquired knowledge of such .Fact, immediately approached the Executing Court with some higher offers, but the learned Single Judge, without having carefully examined the relevant record of the case, rejected both the applications of the appellants for flimsy reasons. He also contended that the rule of audi alterarn partem was grossly violated by the Executing Court, as the confirmation of sale of the two disputed properties of the judgment- debtors/appellants in favour of respondent No.3, was an exercise undertaken behind their back, and this fact alone is sufficient to nullify and scrap such transaction of sale; confirmed by the learned Single Judge, vide his order dated 17-10-2002. Dilating upon the illegalities, committed in the acceptance of such bid, learned counsel contended that once the proceedings for sale of mortgaged properties, had commenced through the mediation of Court; as evident from the record of Execution Application No.58 of 2000, the CIRC, having not even been joined as party to the execution proceedings nor having brought on record any material for this purpose, had no locus standi to proceed further in a shabby and collusive manner to dispose of the two properties of the appellants in favour of respondent No.3, that too, without any notice or information to them about the offer given by respondent No.3 or its acceptance by them through negotiations. In the same context, learned counsel submitted that twice the bids of the said mortgaged properties were invited through Nazir of this Court, but such bids were not accepted by the Court, therefore, in such circumstances, it was incumbent upon the Executing Court to have invited fresh bids for sale of two mortgaged properties, instead of allowing sale through negotiations by the CIRC, who had, for the second time, obliged the respondent No.3, Mrs. Salina Kamal, as the other mortgaged Property bearing No.D- 14 1, block-4, Clifton, admeasuring 1000 Sq.Yds, was also sold to her behind the back of the appellants at a nominal price of Rs.7.9 millions. Learned counsel further alleged a glaring violation of the provisions of order XXI, rules 66 and 89, C.P.G. In the process of completion of sale in favour of respondent No.3, which according to him, has vitiated the whole transaction. In support of his above submissions, learned counsel placed reliance on the following cases:--
(1) Messrs Ripple Jewellers (Pvt.) Ltd. v. First Women Bank 2003 CLD 1318;
(2) Mrs. Shahida Saleem and another v. Habib Credit and. Exchange Bank and 4 others 2001 CLC 126;
(3) Mazarul Haq and another v. Messrs Muslim Commercial Bank Ltd. And another PLD 1993 Lahore 706;
(4) Messrs National Electric Co. Of Pakistan v. Allied Bank of Pakistan Ltd. And 2 others 1996 CLC 192;
(5) Nani Gopal Paul v. Prasad Singh and others AIR 1995 SC 1971;
(6) Messrs Nizamuddin & Co. And 4 others v. Messrs Bank of Khyber 2003 CLD 914;
(7) Talib Hussain and others v. Board of Revenue 2003 SCMR 549;
(8) Messrs Majid & Sons and another v. National Bank of Pakistan 2002 CLD 1742;
(9) Habib Bank Ltd. v. Messrs Ajma Corporation and others 2000 CLC 1425;
(10) Messrs Jaipur Mineral Development Syndicate, Jaipur v. The Commer. Of L-T, New Delhi AIR 1977 SC 1348;
(11) Mst. Amina Begum and others v. Mehar Ghulam Dastgir PLD 1978 SC 220;
(12) Muhammad Sadiq and others v. Ali Asghar Khan and others 1995 CLC 522;
(13) United India Insurance Company Ltd. v. Rajendra Singh and others AIR 2000 SC 1165;
(14) Mst. Manzoor Jahan Begum and others v. Haji Hussain Baksh PLD 1966 SC 375.
6. Mr. Sadruddin Huda, learned counsel for the respondent No.1, has not advanced any arguments in reply. His only submission is that after the surrender of decree under execution in favour of CIRC, United Bank Limited, the respondent No.1 in the present appeal, had divested itself of all the rights, title and interests in these proceedings, therefore, on the basis of their application under Order I, rule 10, C.P.C. (C.M.A. No.2045 of 2006), their name is liable to be deleted from the array of respondents in this appeal.
7. Mr. Masood Anwar Ausaf, learned counsel for the respondent No.2, has strongly defended the transaction of sale of the two mortgaged Properties Nos.C-33 and C-34, for a sum of Rs.10.3 million in favour of respondent No.3. He contended that with reference to the other property No.D- 141, Block 4, Clifton, Karachi, admeasuring 1000 Sq.Yds., also owned by the appellants and subject matter of mortgage in the same decree under execution, having been sold by the Nazir of this Court to the respondent No.3, it cannot be said that there was any collusion between the respondents Nos.2 and 3, which enabled the respondent No.3 to purchase the other mortgaged properties for the aforesaid sum, which was the prevalent market price of these properties at the relevant time. In this context, he made specific reference to the earlier bids through Nazir of this Court in the sums of Rs.50,00,000 and Rs.82,00,000 received from Mr. Muhammad Zafar Pracha and Mr. Faiz M. Brohi respectively to make a comparison of the offer of respondent No.3 with these offers and to show that the two properties were sold to the respondent No.3 at the maximum market price prevalent at the relevant time. To add force to his submissions that the instant transaction of sale through CIRC is a valid and transparent transaction, and thus not open to question at the hands of appellants, learned counsel made reference to the following cases:--
(1) United Bank Limited v. Messrs A.Z. Hashmi (Pvt.) Ltd. And 8 others 2000 CLC 1438;
(2) Messrs United Bank Ltd Karachi v. Mst. Asma Zafarul Hassan 1980 CLC 565;
(3) Trust Leaving v. Messrs Regent Dying 2005 CLC 1368;
(4) Messrs Chawla International v. Habib Bank Limited and others 2003 CLD 956.
8. Learned counsel also challenged the earlier C.M.A. No.536 of 2003 on the ground of its maintainability, being barred- by limitation in terms of Article 166 of the Limitation Act. For this, he placed reliance upon the case of Azhar Haider Shah v. The State 1988 SCMR 108. Learned counsel, however, conceded that this aspect of the case was not looked into or decided by the learned Single Judge at the time of passing of impugned order. In the end, learned counsel also made reference to the case of Muhammad Ikhlaq Memon v. Zakaria Ghani and others PLD 2005 SC 819 and contended that sale through negotiations, the practice which was followed by the CIRC in the present case, has been approved by the Honourable Supreme Court of Pakistan in the said case.
9. Mr. Mushtaq A. Memon, learned counsel for the Auction-purchaser/respondent No.3, has narrated in detail the relevant facts, which according to him, have also been explicitly recorded in paras 10 to 37 of the impugned order. Making reference to the contents of two applications (as reproduced above) he urged that it is not the case of the appellants/judgment- debtors that the two mortgaged properties in question could not have been sold in the execution of decree passed against them, rather, in substance, the grievance of the appellants is only to the extent that the sale of the two properties at the price of Rs.10.3 million is not according to its market value and to prove this fact, the appellants, have brought before the Court two offers, one in the sum of Rs.11.5 million as noted in C.M.A. No.536 of 2003, and the other for Rs.12.5 million as noted in the other C.M.A. No.1230 of 2003. In this context, he made reference to the following cases wherein inadequacy of sale consideration was not accepted as a valid ground to set aside the sale once confirmed by the Court:--
(i) United Bank Ltd. v. Messrs A.Z. Hashmi (Pvt.) Ltd. And 8 others 2000 CLC 1438;
(ii) Messrs United Bank Ltd. Karachi v. Mst. Asma Zafarul Hassan 1980 CLC 565;
(iii) Messrs Chawla International v. Habib Bank Ltd. And others 2003 CLD 956;
(iv) Trust Leaving v. Messrs Regent Dying 2005 CLC 1368.
10. Making reference to the further progress in the execution proceedings, learned counsel submitted that after the payment of full consideration amount by the respondent No.3, the Sale Certificate was lawfully issued in her favour on 12-9-2006 and possession was also delivered to her and in such circumstances after completion of the entire exercise, on the pretext of instant appeal, a past and closed transaction cannot be re-opened at the behest of judgment-debtors, who had in the first instance not challenged the judgment and decree passed against them in Suit No.484 of 1988 and then have not approached this Court at this belated stage with clean hands. To lay further emphasis on his argument that sale of the properties through Court once confirmed is not open to question, learned counsel also placed reliance on following other cases:--
(1) Mst. Asma Zafarul Hassan v. Messrs United Bank Ltd. And another 1981 SCMR 108; (2). P.Q. Chemicals v. A.W. Brothers and others 2005 CLD 169;
(3) Muhammad Ikhlaq Memon v. Zakaria Ghani and others PLD 2005 SC 819.
11. Mr. Badar Alam, learned counsel for the appellants, in his reply arguments, contended that once the appellants have succeeded to establish from the case record that the transaction of sale of the two mortgaged properties, undertaken by CIRC, behind the back of the judgment-debtors, is in violation of the principles of natural justice, the same is liable to be struck down and consequently the super-structure built on such transaction is also bound to collapse. In this regard, learned counsel emphasized that the perusal of whole case record would show that after the passing of judgment and decree in Suit No.484 of 1988 and upon filing of Execution Application No.58 of 2000, not a single notice was ever issued to the judgment-debtors informing them about the filing of execution proceedings or passing of various orders from time to time adverse to their interest. He reiterated that in the circumstances where the decree-holder Bank had already received payment of Rs.50.5 million from the appellants/judgment-debtors towards the decree under execution without even accounting for the sale proceeds of Property No.D-14-1, Block 4, Clifton, Karachi, having been sold for Rs.7.9 million, it was only a matter of payment of few more millions of rupees by the judgment-debtors to the decree-holder Bank to record complete satisfaction of decree, therefore, the whole action taken by the CIRC for the sale of two mortgaged properties in favour of respondent No.3 through negotiations is a mala fide and colorful exercise of authority, which should not have been approved/accepted by the Executing Court at least without affording opportunity of hearing to the present appellants to match such offer.
12. We have carefully considered the submissions of the parties' counsel, perused the material placed on record, R and Ps of Execution Application No.58 of 2000 and also the case-law, cited at the bar.
13. At the outset, if we look at the impugned order passed by the learned Single Judge, we find that various contentions raised by Mr. Badar Alam were carefully considered and repelled by the learned Single Judge in paras 39 to 41 of his order, which read thus:-- "39. Now examining the contentions of Mr. Badar Alam, that no notice was given to the JD is concerned. It may be observed that the suit was contested. No appeal appears to have been filed. Execution was filed on 7-12-1999. Once the execution is filed Banking Court is required to issue execution forthwith, which was done on 28-3-2000. Possession of the subject-property was taken over by the Nazir on 7-3-2002 from the Judgment-debtor No.3 and her daughter as is evident from the Nazir Report dated 14-3-2002, Nazir also turned down their request for further time. The JDs Nos.1 to 3 took no exception, removed some of their belonging and vacated the property. Thrice publication was affected, at no point in time JD came forward to impugn any of the orders of sale passed by the Court. JDs Nos.2 and 3 are husband and wife cannot complain that they had no notice of sale of the subject-property. At least very taking over the possession of the subject -property by the Nazir of this Court on 7-3-2001 from the JD No.3 itself, is a sufficient notice, sale through negotiation was accepted much after on 17-10-2002. The JD No.2 filed C.M.A. No.536 of 2003 on 10- 3-2003 after more then a year from the date of taking over the possession from her and almost five months from the date of acceptance of offer. Of sale . Like wise JD No.3 filed C.M.A. No.1230 of 2004 on 20-5-2004 after more than three years from the date of dispossession.
40. In some what similar situation in the case reported as Muhammad Akhlaq Memon v. Zakaria Ghani PLD 2005 SC 819, where several attempt to sell the property by inviting bid through publication in newspaper failed property sold through private negotiation. Sale was set aside in appeal, however, apex Court approved the sale holding that the Banking Court is competent to adopt such procedure as is it may deem fit. Objections as to observance of provisions of C.P.C.
Were not considered, fatal to the negotiated sale.
41. Since the entire amount has been paid by the purchaser, no objection to sale have been filed by the JDs Nos.1 to 3, merely raising objections as to inadequacies of sale price is not sufficient. In none of the applications filed any illegalities going to the root of the sale were raised. The J.D.
Remained quite even after taking over the possession of the subject-property by the Nazir and only complained that they have a buyer of higher value without disclosing credential of the buyer cannot be given any crederice."
14. Admittedly, against the judgment and decree under execution passed. In Suit No.484 of 1998 dated 27-8-1999, followed by preparation of final' decree dated 8-9-1999, no appeal was preferred by any of the appellants to challenge such decree. This conduct goes to show that not only the said decree had attained finality and was to be satisfied by the appellants, but the appellants have also, at the earlier stage of the proceedings, accepted such liability to be paid to the respondent No.
1. It is also an admitted position from the record that prior to the sale of the two properties of the appellants bearing Nos.C-33 and C-34, block-4, Scheme No.5, Clifton, Karachi, another Property bearing No.141, block-4, Clifton; Karachi, was sold in the sum of Rs.79 million in the execution proceedings of the same deree, but the appellants did not object to such sale through the Court, which had now attained finality. The possession of the two disputed properties was also admittedly received by the 'Nazir of this Court much prior to the sale of these properties in favour of the respondent No.3, which was more than sufficient notice of the execution proceedings to them, but even then the appellants opted not to attend/pursue or contest the proceedings of the execution application.
15. In the above discussed facts and circumstances, when we look at the contents of the two miscellaneous applications, dismissed by the learned. Single Judge by his impugned order dated 2-6-2006, we find that the only grievance of the appellants through these applications, was about the alleged nominal sale consideration as against the two offers made by them before the Court in terms of these applications and not of any collusive, mala fide or illegal acts having been committed during the process of such sale. There is no denial of the fact that the decree under execution was conveyed in favour of CIRC in terms of various documents particularly the transfer and assigning agreement dated 28th March, 2001 and, therefore, the CIRC was well within its rights to pursue the sale of two properties of the appellants. More so, when they have brought a much higher offer then the two offers received by the Nazir of this Court in the earlier process of auction, which were not accepted by the Court, the grievance of low price raised by the appellants, also seems to be unjustified and an afterthought. It will be pertinent to mention here that during the period when the two disputed properties of the appellants were sold through CIRC and soon thereafter the market value of the immovable properties in the urban areas of Karachi, particularly in Defence and Clifton Areas, had multiplied in no time and it was in such circumstances that the appellants had given a second thought and opted to challenge the confirmed transaction of sale of the two properties in favour of the No.3 on the pretext of two listed applications. The case of the appellants is, thus, clearly hit by the ratio of judgment of the Honourable Supreme Court of Pakistan in the case of Hudaibia Textile Mills Ltd. v. ABL PLD 1987 SC 512.
16. As to the other argument of Mr. Badar Alam in the context of alleged procedural irregularities committed during the sale of the properties, suffice it to observe that the judgment of the Honourable Supreme Court of Pakistan in the case of Muhammad Ikhlaq Memon (supra) is a complete answer to it and it disentitles the appellants for grant of any relief on such pretext. The plea of Mr. Badar Alam that due opportunity of hearing was not afforded to the appellants before confirmation of sale has also no legs to stand, as admittedly execution proceedings were initiated by the respondent No.1 within one year from the date of passing of decree and, therefore, no fresh notice for such proceedings was required to the judgment-debtors/appellants. Moreover, as discussed in the impugned order, there is sufficient material on record to show that the appellants were well aware of the different stages of proceedings in the Execution Application, but for the reasons best known to them, they did not opt to contest such proceedings. The submission of Mr. Badar Alam as regards payment of Rs.50.5 millions by the appellants to the decree-holder Bank outside the execution proceedings is also equally without force as, admittedly, despite such alleged payment, a part of decree under execution was un-satisfied -and, therefore, sale of mortgaged properties was justified. As regards the case-law cited by Mr. Badar Alam, suffice it to observe that in the facts and circumstances of the instant case, such , cases are distinguishable and do not help the pleas raised by the appellants in the present case.
17. The upshot of the above discussion is that this appeal is dismissed with costs.