1. SYED SAJJAD ALI SHAH, J. - Though this appeal under Section 22 of Financial Institution (Recovery of Finances) Ordinance, 2001, the applicant has challenged the judgment and decree dated 28.2.2006 and. 29.3.2006 respectively passed by the Banking Court No. 2, Larkana Division at Larkana whereby the suit of the appellant for recovery of Rs. 1,077,688/- filed against respondent No. 1 was dismissed for want of jurisdiction. As the appellant corporation was not found to be a banking company.
2. Learned Counsel for the appellant has contended that the is a statutory body established under the provisions of Sindh Small Industries & Handicraft Development Corporation Act, 1972 to take measures for rendering assistance in the establishment and development of Cottage, Small & other Industries in the Province of Sindh and for that purpose it advance loans and finances to various persons and companies, therefore, it can not be said that the appellant is not a banking company, therefore, the finding of the Banking Court' that the appellant is not a banking Co.
3. Car\not be sustained, It was. Further contended that the plaintiffs have instituted various cases before different Banking 'Courts who never questioned the entitlement of the appellant to institute recovery cases, on the contr-ary number of cases were decreed in favour of the appellant.
4. We have heard learned counsel for the appellant at length and have gone through the impugned judgment and decree as placed on record.
5. Banking Company has been defined in Section 5(c) of the Banking Companies Ordinance 1962 in the following terms:- "Banking Company' means any company which transact the business of banking in Pakistan"
6. Whereas 'Banking' has been defined in Section 5(b) of the Banking Companies Ordinance, 1962 as under:- "Banking' means the accepting, for the purposes of lending or investment, of deposits of money from the pubic repayable on demand or otherwise and withdrawable by cheque, draft, order or otherwise"
7. It is further important to mention that no company can carry the business of banking unless it holds a license from the State Bank of Pakistan as provided in sub-section (1) of Section 27 of the Banking Companies Ordinance, 1962 which is reproduced herein below for the sake of convenience.- "Licensing of banking companies ORDINANCE idividual or association or body of inc, I not ; emg a company, shall carry on banking business in Pakistan and save as hereinafter provided, no company shall carry on banking business in Pakistan unless it holds a license issued in that behalf by the State Bank; and such license may be issued subject to such conditions as the State Bank may think fit to impose.
8. On the other hand, Financial Institution has been defined in Section 2(a) of the Financial Institutions (Recovery of Finances ) Ordinance, 2001 to the following effect:- "2. . Definitions.- In this Ordinance, unless there is any thing repugnant in the subject or context:-
(a) "financial institution" means and Include:-
(i) any company whether incorporated within or outside Pakistan which transacts the business of banking or any associated or ancillary business in Pakistan through its branches within or outride Pakistan and includes a government savings bank, but excludes the State Bank of Pakistan; -
(ii) a modaraba or modaraba management company, leasing company, investment bank, venture capital company, financing company, unit trust or mutual fund, of. Any kind and credit or investment institution, corporation or company; and
(iii) any company authorized by law to carry on any similar business, as the Federal Government may by notification . In the official Gazette, specify."
9. A perusal of the aforesaid provision reflects that a company whether incorporated within or outside Pakistan which transacts business of banking or any associated or ancillary business in Pakistan through its branches within or outside Pakistan including Government Saving Bank or a modaraba or its management company, leasing Company, investment Bank, Venture Capital Company, Financing Company, Unit trust or mutual fund of any kind and credit or investment institution, Corporation or. Company, or a Company authorized by law to carry on any similar business through a notification in the Official Gazette, falls within the ambit of Financial Institution.
10. In view of the legal position as on record, learned counsel for the appellant was not in a position to place anything on record to demonstrate that the appellant can be termed as a banking company as addition. only it does not accept deposits of money from the public for the purposes of lending or investment as envisaged in Section 5(b) of the Banking Companies Ordinance, 1962 nor was in a position to show that the appellant can be termed as financial institution as defined infection 2(a) of the Financial Institutions (Recovery of Finances) Ordinance, 2001 as it does not carry the business of banking. The learned counsel has further frankly conceded that the appellant has not been notified by the Federal Government to carry on any similar business, as envisaged in clause iii, of Section 2(a) of the Financial Institutions (Recovery of Finances) Ordinance, 2001, in order to attract the jurisdiction of the Banking Court.
11. In view of what has been discussed above, no exception can be made to the order of the Banking Court so far it held that the appellant is not a banking Company. However, the perusal of the judgment impugned reflects that the Banking Court, while holding that it has no jurisdiction, instead of returning the plaint to the appellant, as provided under Order 7, Rule 10, C.P.C., dismissed the suit ignoring that sub-section (2) of Section 7 of the Financial Institutions (Recovery of Finances) Ordinance, 200I, specifically provides that Banking Court shall in all matters with respect to which the procedure has not been provided for in the said Ordinance, follow the procedure laid down in Code of Civil Procedure, 1908. In the circumstances, we are of the view that instead of dismissing the suit the plaint ought to have returned to the appellant for presenting the same before the Court having jurisdiction-in the matter.
12. Since the respondent remained absent before the Trial Court and was declared ex-parte therefore, no fruitful purpose would be served nor any prejudice shall be caused to the respondent No. 1 in case this appeal is finally decided. We, therefore, set aside The decree to the extent of dismissal for want of jurisdiction and direct the Trial Court to return the plaint to the plaintiff as envisaged under Order 7, Rule 10, C.P.C, for presenting the same to the Court having jurisdiction. Office is further directed to issue- necessary certificates to the appellant for the return of the Court fees as envisaged under Section 13 of the Court Fees Act, 1870.