1. GHULAM MUSTAFA MUGHAL, J.---This is an application for cancellation of an ex parte decree passed by this Court in civil suit No.1 of 1998, dated 12-2-2001.
2. Precise facts forming the background of the above captioned application are that N.B.P. Filed a suit under the Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997 against the defendant/applicant (Mill) on 13-6-1998 for recovery of Rs.3,80,90,428 before this Court.
3. The applicant (Mill) was represented by Haji Ch. Muhammad Afzal, Advocate who withdrew his power of attorney on 8-10-1999 as is evident from the interim order recorded on the said date. On 16-11-1999, proclamation was issued for service of the defendants and the next date was fixed as December 6, 1999. Defendants/applicants did not appear, hence, were proceeded ex parte. After necessary proceedings vide judgment dated 12-2- 2001 impugned judgment and decree was awarded in favour of the plaintiff/Bank.
4. The above captioned application has been filed on the ground that defendant/Mill was not served, therefore, ex parte proceedings as well as decree is violative of law. It is also pleaded that some other suits were pending in different Courts in which N.B.P. Was also a party. It is also claimed that A.D.B. Was first charge holder against the Mill but was not impleaded in line of the defendants: An application for condonation of delay has also been filed along with the above application. The N.B.P. Filed objections in which it is stated that application is time barred and is not maintainable. It is admitted in the petition that A.D.B. Was, first charge holder. It is also stated in the objections that provisions of section 29 are not attracted in the case of Mian Muhammad Sugar Mills. The rest of the paras have been denied, evasively. Raja Muhammad Yaqoob Khan, the learned Advocate appearing for Mian. Muhammad Sugar Mills, inter alia, contended that ex parte decree is void ab initio as Haji Ch. Muhammad Afzal, the learned Advocate who was representing defendants/(Mill) did not serve any notice of withdrawal from the prosecution of the suit as is envisaged by Order III, rule 4 of C.P.C. The learned Advocate also contended that it was mandatory provision and non- compliance whereof has rendered the whole proceedings coram non judice. The learned Advocate further contended that though a notice was issued to the defendants for appearance on 16-11-1999 but on the said date it was found by this Court that notice could not be issued by the office. The learned Advocate next argued that the Court has also called explanation of the Registrar for non- compliance of the order of the Court either i.e. The order dated 8-10-1999. He maintained that on this date a fresh notice and a proclamation was also ordered to be issued. On the basis of this proclamation defendants were proceeded ex parte on 6-12-1999. It was further argued by the learned Advocate that whole proceedings have been conducted in violation of law and mandatory procedure as well as in absence of necessary party, hence, decree is ab initio void and is liable to be recalled. In support of his submissions the learned Advocate placed reliance on Major Syed Walayat Shah's case (PIA) 1971 SC 184) and Sikandar Mehmood's case (PLD 1998 Lah. 118).
5. In the first case, the apex Court of Pakistan has observed that if order of tribunal found to be without jurisdiction all successive orders based upon it are illegal and liable to be quashed. In the other case, the appeal of the appellant therein was decided ex parte. Ex parte proceedings were taken by the first appellate Court in violation of the conditions mentioned in Order V, rule 20, C.P.C., therefore, it was held that ex parte proceedings and judgment of the first appellate Court are illegal and the case was remanded for de nova proceedings. Mr. Javed Najum Saqib, the learned Advocate for N.B.P. Contendedlhat the application is time-barred and is liable to be dismissed without attending the merits of the case. The learned Advocate also contended that the application has been filed without any lawful authority because the power of attorney on the basis of which the application has been instituted does not vest the applicant with any authority to institute the application for setting aside ex parte decree. The learned Advocate further contended that the procedure prescribed by Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997, and, Rules made thereunder is of special nature and the defendants/Mill could be served simultaneously by issuing notice as well as proclamation in the newspaper. The learned Advocate also maintained that method adopted by the Court is for speedy trial of the case which is the purpose of special law under which the trial is to be conducted, therefore, no illegality has been committed by the. Court. The learned Advocate placed reliance on Muhammad Mehrban's case (1995 CLC 1541).
6. In Muhammad Mehrban's case, referred to and relied upon by Mr. Javed Najum Saqib, the learned Advocate for N.B.P. It was opined that power of attorney only gives powers which are specifically mentioned in it and it operates prospectively and not retrospectively. A pemsal of the precedent reveals that the facts of this case are entirely different and have no nexus with the controversy in hand. I have heard the learned Advocates representing the parties and gone through the record of the case, carefully. It may be stated that the contentions raised by Raja Muhammad Yaqoob Khan, Advocate, find support from the record. A perusal of the record reveals that the defendants/ (Mill) engaged Haji Muhammad Afzal, Advocate, for prosecution of the case but on 8-10-1999, the learned Advocate moved an application for withdrawal of his power of attorney on the ground that neither his professional fee has been paid nor the defendants/Mill are attending the case. His application was allowed. Notice was issued by this Court to the defendants and the next date of hearing was fixed as November 16, 1999. On this date as it is recorded in the interim order this Court sought explanation of the circuit Registrar for not issuing notices to the defendants. It was further observed that the defendants are avoiding service, therefore, proclamation was issued and the next date of hearing was fixed as December 6, 1999. No one appeared on behalf of the defendants on this date, therefore, ex pane proceedings were ordered against them. It is pertinent to mention here that in the interim order recorded on 6-12-1999, presence of Raja Fazal Hussain Rabani, Advocate for defendant No.2, has been recorded. Raja Fazal Hussain Rabani, was never authorised to appear by defendant No.2 nor any power of attorney is available on the record. Fact of the matter is that Raja Fazal Hussain Rabani, Advocate, filed an application for impleading one Faisal S. Khan, claiming him as Managing Director of the Mill. His application is available at page 456 of the file. The power of attorney executed in favour of Raja Fazal Hussain Rabani is also available at page 458 of the file which reveals that the same has been executed by Faisal S. Khan, Chief Executive of Mian Muhammad Sugar Mills, Ltd. Only for impleading him in line of the defendants. In this view of the matter defendant No.2 was not represenfed by Raja Fazal Htissain Rabani. The first question which needs resolution is as to whether issuance of proclamation was justified without effecting personal service on the defendants. While exercising its civil jurisdiction the Banking Court has to follow the procedure laid down in this regard in the C.P.C. The contention of Mr. Javed Najum Saqib, that proclamation as well as notice for service of the defendants could be issued simultaneously is correct. This contention has been raised by the learned Advocate in light of the procedure provided for Institution of the suits and onward proceedings by section 9 of Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997. Subsection (3) of section 9 of the said Act provides that the Court can adopt any mode of service mentioned in the subsection including the publication of proclamation. A careful perusal of provisions makes it clear that the provision relates to the institution of the suits. In the present cast the service on the defendants was effected. The defendants engaged Haji Muhammad Afzal, Advocate, for prosecution of the suit but he withdrew his power of attorney without -complying with the provisions of Order III, rule 4 of C.P.C. The special law does not provide any guidelines in this regard, therefore, provisions of the C.P.C. Contained in Order III, rule 4 shall apply. Even otherwise the provisions of the Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997 were not applicable to the High Court while exercising the original jurisdiction under the said Act because the High Court is not a Court established under the Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997. As stated above, there is no corresponding provision in the said Act for handling the situation, therefore, this Court was bound to apply the procedure provided by the C.P.C.
7. In Hudaybia Textile Mill's case (PLD 1987 SC 512), the provision of section 3, 6(1)(a), 7(2) and 8(3) of the Banking Companies (Recovery of Loans) Ordinance, 1979 and applicability of the Code. Of Civil Procedure have been examined at length. Though the Banking Companies (Recovery of Loans)
8. Ordinance, 1979 has been repelled but the provisions of the Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997 are the same. The apex Court of Pakistan at page 522 of the report has resolved the issue in the following words:-- "11. Now having regard to section 3, section 6(1), section 6(1)(a) and section 7(2), it is clear that while trying a suit the Special Court to follow the procedure laid down in the Code of Civil Procedure particularly the summary procedure provided for in Order XXXVII. It may further be noted that by virtue of the fact that section 7(2) expressly provides that in all suits the Special Court shall follow the summary procedure provided for in Order XXXVII, C.P.C. It follows that as provided by rule 7 of the said 'Order, the provisions of the procedural law in regard to ordinary suits filed in Civil courts is to be followed save, as provided by the said Order. In other words the only distinction between the procedure applicable to a suit instituted in the ordinary manner and a suit under Order XXXVII is that the defendants cannot appear and defend the suit as a matter of right but only after he obtained leave to defend on showing that there is a triable issue. In this connection it will be useful to refer to section 4(1) and section 141. Of the C.P.C. Which provided as under:- "Section 4(1). In the absence of any specific provision to the contrary, nothing in this Code shall be deemed to limit or otherwise affect any special or local law now in force or any special jurisdiction or power conferred, or. any special form procedure prescribed, by or under any other law for the time being in force."
9. Section 141. Miscellaneous proceedings. The procedure provided in this Code in regard to suits shall be followed, as far as it can be made applicable, in all proceedings in any Court of civil jurisdiction.
10. Reading sections 4(1) and 141, C.P.C. Together the position that emerges clearly, is that while exercising its civil jurisdiction the special Court has to follow the procedure laid down in regard to the suits in the C.P.C. Except to the extent any contrary provisions is made in the special 'enactment. Therefore, wherever the provisions of the Ordinance are repugnant to the provisions of the C.P.C., the former will override the latter. To that extent the general provisions of the C.P.C. Will give way to the contrary provisions of the Ordinance which will take over to the extent of the repugnancy. From another angle also the same position seems to arise. It will be noticed that a Special Court under the Ordinance in respect of a case involving loan not exceeding one million rupees is the Court designated by the Federal Government, by notification in the official Gazette comprising a District Judge or Additional District Judge or in absence of such notification the District Court. But in respect of any other case, namely cases involving outstanding amount of loan exceeding one million rupees, the jurisdiction has been' vested in the High Court in the exercise of its original civil jurisdiction. As the High Court is an already established Court and is not the creature of the special enactment the procedure ordinarily governing the trial of suits would regulate the proceedings, except as already stated to the extent contrary provision is made in the special enactment conferring jurisdiction. This principle has been approved in the case of Hussain Bakhsh v. Settlement Commissioner, and others PLD 1970 SC 1. In this case it was held that the C.P.C.
11. Governs civil proceedings in the High Court and the dictum was stated as under:- "When a question is stated to be referred to an established Court without more, it in my opinion, imports that the ordinary incidents of the procedure of that Court are to attach, and also that any general right to appeal from its decisions likewise attaches."
12. It is important to note the words "without more" which clearly imply that the ordinary incidents of the procedure of such an established Court would apply provided the special enactment which creates the jurisdiction does not provide anything by way of procedure for the trial of the question referred to such established Court, in which case the special procedural provisions will override the ordinary procedure even of such established Court."
13. The same view has been reiterated by a Division Bench of Karachi High Court in a case titled Bank of Credit and Commerce International (Overseas) Ltd. v. Banking Tribunal for Sindh Balochistan and 2 others (1990 MLD 309). At page 311 of the report the learned Judges of the Sindh High. Court in para. No.7 of the report observed as under:- "7. It is to be noted that the procedure of the Tribunal, regarding the exercises of its jurisdiction is clearly covered by the Code of Civil Procedure and if not more at least the principles deducible from the Code apply to the Tribunal. Indeed, even in respect of forums where some or more of the provisions of the Code of Civil Procedure have been expressly excluded the consensus of judicial opinion is that the principle and provisions of the Code of Civil Procedure, as are in consonance with equity, justice and fairplay in a lis are still to apply. In point, may be the jurisdiction of Controllers under the West Pakistan Rent Restriction Ordinance (VI of 1959) and the Sindh Rented Premises Ordinance, 1979 wherein either the provisions of the Code have been excluded wholly or in part but the above dicta has still been applied."
14. The relevant interim order reveals that Haji Muhammad Afzal, Advocate, made a bare statement that he wants to withdraw from the prosecution of the suit and this Court permitted him. In my estimation and. I respectfully say so that this is a serious miscarriage of justice and defendants have been penalised for the act of their Counsel and this Court. Had Haji Muhammad Afzal, Advocate, informed his client about revocation of his power of attorney in time definitely they would have appeared to defend the suit. Withdrawal from the prosecution as contemplated by rule .4 of Order III Is not a unilateral act of a party to the suit. The learned Advocate representing the defendants was bound to intimate them before withdrawal from the prosecution through a notice.
15. Upon his intimation, non-appearance of the defendants could be considered as wilful absence on the next date. Non-compliance of the above provision of C.P.C. In my estimation has rendered the whole proceedings coram non judice, null and void, and this sole ground is sufficient for granting this application. UBL's case (1998 CLC 179) is direct authority on the point. Almost in the similar circumstances Mr. Justice Rasheed A. Razvi, (as his lordship then was) in paras. Nos.6 and 7 of the report observed as under:-- "6. ... ..It is now settled law that an appointment of an advocate remains in force until determined with leave of the Court or until the party or the pleader dies or until all proceedings in regard to his client are ended. (For any reference see the cases of Pakistan through General Manager, Pakistan Railway v. Messrs Q.M.R. Expert Consultants (PLD 1990 SC 800), Kamal Din and others v. Nazir Ahmed (1987 CLC 1208) and also the case of Messrs Aziz Flour Mills and 2 others v. The Industrial Development Bank of Pakistan (1990 CLC 1473).
7. There exist two possible eventualities in case an order would have been passed by this Court on the statement of Mr. Sohail Muzaffar, Advocate. One, that he might have been allowed to withdraw from the case, then in such event there remained in field the Vakalatnama of Mr. Javed Jalal of Lahore who was not aware of the proceedings. In case of second possibility, i.e. Rejection of request for discharge of Vakalatnama, it was the duty of the. Learned Advocate then appearing for the defendant to seek proper instructions from the defendant and to produce him in evidence.
16. Whatever the result would have been, it was a difficult task for the then Advocate appearing for the defendant to make arrangement for evidence as the other counsel as well as defendant both were residents of Lahore. One should not loose sight of the fact that this suit pertains to the year 1977 and the Vakalatnama filed by Mr. Sohail Muzaffar and Mr. Javed Jalal, Advocates, date back to March, 1979. All these circumstances indicate that this Court acted in haste in passing ex parte judgment without affording reasonable opportunity to the then counsel and the defendant to produce evidence."
17. In view of above, it is clear that no procedure was adopted as is provided by Order III. Even for ordering the substituted service under the Code of Civil Procedure, Court has to record a definite finding that the defendant is avoiding service. The findings ordinarily are recorded on the report of the Process- Server who has taken pain in searching the defendants. This provision is mandatory and its non- compliance again rendered the whole proceedings as coram non judice. In Sikandar Mehmood's case, referred to and relied upon by Raja Muhammad Yaqoob Khan, Advocate for Mian Muhammad Sugar Mill, similar conclusion was reached at by the Lahore High Court. The relevant observation is recorded at page 123 of the report which is as under:-- "....The resume given by me of the circumstances in which the substituted service was directed leads me to one and the only irresistible conclusion that the learned. Additional District Judge totally lost sight of the provisions of Order V, rule 20, C.P. Code. He did not come to a definite conclusion that the respondents were avoiding service wilfully and only after observing that respondents could not be served in spite of summonses having been sent through registered letters several times, he opted to proceed for getting them served through citation. The better course for him would have been first to have awaited the return of the process issued in the names of the respondents and if there was a report that they were not available on the given address, ask the appellants/defendants to furnish their fresh and complete address, make further efforts to get their personal service effected in the ordinary manner and then only after satisfying himself and verifying the fact that all efforts made in this behalf for effecting their service in ordinary manner had failed that the substituted service could be resorted to. Record must show the efforts made to that effect for securing personal service and in the absence thereof, citation in the newspaper would not be sustainable. For substituted service, also efforts should have first been made to get the service effected by affixing a copy of the summons/notice on the notice board of the Court house and another copy on the outer door of the house where the respondents were known to have last resided and simultaneously therewith, citation could also be ordered. Similarly, publication in newspaper of insignificant circulation also could not justify the ex parte proceedings."
18. Mst. Sardaran Begum's case [1993 CLC 2303], can also be referred in support of the proposition. At page 2305 of the report this Court observed as under:- "The rules of procedure applicable to service of summons are covered by Order V, rules 12, 17, 19 and 20, C.P.C. Rule 12 postulates that wherever it is practicable, service shall be effected on the defendant in person, unless he has an agent empowered to accept service. In such case, service on the agent shall be sufficient. Rule 17, next, provides that where the defendant or his agent or some other authorised person refuses to acknowledge the service or where the serving officer, after using all due and reasonable diligence, cannot find the defendant and there is no agent so empowered to accept service, nor any other person was authorised, it was enjoined upon the serving officer to affix a copy of the summons on the outer door of residence of the defendant or some other conspicuous part of the house in which the defendant ordinarily resided or carried on business or personally worked for gain. The summons was to be returned to the Court with a report endorsed thereupon, containing the circumstances of his report. The report was also to contain the particulars of the person who identified the house of the defendant and in whose presence the summons was affixed.
6. Rule 19, is co-related to rule 17. Under this Rule, it was enjoined upon the Court, on return of the summons in the light of the provisions of rule 17, to examine the serving officer on oath, in support of the report endorsed on the summons.
7. The last mode of service has been coined in the shape of scheme postulated under rule 20 of Order V, C.P.C. It provides that where the Court is satisfied that there is reason to believe that the defendant is keeping out of the Way for the purpose of avoiding service or that for any other reason, the summons cannot be served in the ordinary way, the Court shall order the summons to be served by affixing a copy thereof in some conspicuous place in the Court house and also upon some conspicuous part of the house in which the defendant is known to have lastly resided or carried on business or personally worked for gain or in such other manner as the Court may think fit. Sub-rule (2) was incorporated as approval of mode of service. It laid down that the service substituted by the order of the Court shall be as effectual as it has been made on the defendant personally.
8. In present case, it appears from the record that none of the conditions laid down under rules 17, 19 and 20, C.P.C. Have been complied with. The process-server who was entrusted with the summons to effect service on the defendant, was not examined by the Court as provided under the provisions of rule 19. Therefore it cannot be deemed that the service was duly effected on the defendant Under the aforesaid provisions of law."
19. In view of above case law and record of the case, I am of the considered view that issuance of substituted service and ex parte proceedings including ex parte decree on the basis of said service was a nullity in the eye of law. The contention of Mr. Javed Najum Saqib, that application for vacation of ex parte decree is time barred, is without substance. A definite stand has been taken by the defendants/Mill that they come to know about the decree only when a notice was served upon them in the execution application. The contention has not been denied. J This assertion is supported by them through their affidavit and counter affidavit has not been filed by the Bank.
20. Even otherwise I am of the view that the defendants/Mill had not to suffer for an act of the Court, therefore, they are entitled to the condonation of delay, in the attending circumstances of this case. The contention of the learned Advocate for N.B.P. That no specific authority has been granted for filing of this application is also devoid of any force. A perusal of the power of attorney reveals that executee has been vested with the powers to file appeal, review, revision and perform all other necessary acts for prosecution of the suit. A perusal of the power of attorney as a whole leads to the conclusion that the authority to file application for filing ex parte application has been delegated impliedly. The . Upshot of the above discussion is that the application is allowed and ex parte decree dated 12-2-2001 is hereby recalled. Resultantly, the Suit No.1 of 1998, titled N.B.P. v. Mian Muhammad Sugar Mills, stands restored. In the interest of justice it is ordered that the defendants/Mill shall not transfer any property including the machinery of the Mill without prior permission of the Court. The parties are directed to appear before the Court for further proceedings on (sic).