1. ARSHAD NOOR KHAN, J. By this order I intend to dispose off application under Section 5 of the Limitation Act (CMA No. 6165/2006) filed by the defendant, praying therein for condonation of delay in filing of the application under Section 10 of the Financial/Institutions (Recovery of Finances)
2. Ordinance, 2001; hereinafter shall be referred to as "the Ordinance, 2001 " for leave to defend the suit.
3. Facts leading rise to the present application in brief are that the plaintiff filed suit for declaration, mandatory injunction, redemption of mortgage and recovery of damages against the defendant stating therein that the plaintiff No. 1 is a partnership firm, registered under the Partnership Act.
4. Plaintiff Nos. 2 and 3 are the partners of plaintiff No. 1. Mr. Shaikh Muhammad Amin and Mst. Hajra Begum were also the partners of plaintiff No. 1 but they expired on 1.11.1989 and 16.7.2003 respectively. The plaintiff No. 4 duly joined plaintiff No. 1 on 1.7.1989 but she retired from the partnership firm w.e.f. 1.7.2001. The plaintiff No. 4 has been impleaded in the suit as she has remained the partner of plaintiff No. 1 and executed memorandum of deposit of title deeds and additional mortgage deed dated 22.4.2000 and letter of hypothecation. The plaintiff No. 1 is carrying business of dealers, manufacturers, tanners, importers and exporters, suppliers and agent of hides, skins and products and allied items whereas the defendant are banking company incorporated in Pakistan under the Companies Ordinance, 1984 and carrying on the banking business. The plaintiff No. 1 is dealing with the defendant since 1978 in relation to this business imported and exporters.
5. The defendant had sanctioned the limit to the plaintiff No. 1 which was enhanced from time to time.
6. As security the plaintiff No. 1 had mortgaged its leasehold plot of land bearing No. 22, measuring about 2666.6 sq. Yards with present and further construction, situated at Sector 6-A, Korangi Industrial Area, Korangi, Karachi in favour of defendant and executed the documents mentioned in para. 5 of the plaint and deposited original documents mentioned in para. 6 of the plaint, It is further stated in the plaint that plaintiffs Nos. 1, 2 and 3 received. An order for the supply of finished sheep skin leather from M/s. Makers Fabricant Di Pelle RL via Marghe 65029, Sanfa Croce Suir Arna (Pisa), Italy (the importer) for the value of US$ 58.850A. The plaintiffs accordingly exported/shipped the said goods under irrevocable documentary letter of credit of Cassa Di Risparmio Di Volterra SPA, Volterra, Italy Letter of Credit No. 002400808761,. Dated 17.11.2003, Contract No. PK/ICT/83/03, dated 25.9.2003, Form E No. UBL-0859755, dated 22.11.2003. The plaintiffs Nos. 1 to 3 vide their letter dated 1.12.2003 submitted the export documents valuing US$ 58,850/- to the defendant after shipment of the said goods and requested the defendant to negotiate the documents and credit the proceeds In their current Account No. 670-8341-2. The defendant negotiated the export documents as per terms and condition of the said Letter of Credit with the opening bank at Italy.
7. The opening bank accepted the export documents for payment on 8.3.2004. The said goods exported by the plaintiffs Nos. 1 to 3 to the importer at Italy who had given the maturity date for payment on 8.3.2004 and the said goods were delivered to the importer at Italy, the defendant credited the export proceeds in the said account of plaintiff No. 1. The Trade Processing Centre of the defendant addressed a letter dated 3.4.2004 to the Bunder Road Branch, Karachi of the defendant, In his letter it has been stated that the opening bank has accepted the documents for payment on 8.3.2004, but failed to pay on the pretext of some local court orders, It has been further stated that the matter has been taken up with the opening bank in the light of UCP-5000 for effecting immediate payment. Despite these facts it has been -wrongly stated in the said letter that due to non-payment, the bill had attained overdue nature and to take up the matter with the plaintiff No. 1. The plaintiff No. 1 with reference to the said fax message, addressed the letter dated 6.4.2004 to Bunder Road Branch of the defendant and stated that since the defendant had negotiated the documents as per terms and Conditions of Letter of Credit and obtained maturity date from opening bank, therefore, the defendant should take up the matter at its end and recover the amount, In the meantime the defendant also obtained the legal opinion dated 19.5.2004 from their legal department. The Trade Processing Centre of the defendant, addressed letter dated 16.7.2004 to the. Bunder Road Branch, Karachi advising that they were constantly following up with opening bank, their International Division as well as their Head Officer for earliest repatriation of proceeds along with upto date mark-up as the bill was initially accepted by the opening bank and they are still pressing hard on the opening bank in the light of UCP-500 to honour their commitment without any delay. But in the said letter it has been wrongly stated that the bill was negotiated under the Customer's Indemnity, therefore the. Matter was to be taken up with the plaintiff No. 1. On the information of the legal division of defendant, the opening bank cannot defend the non-payment on the. Basis of an injunctive order from a local court, It is further stated in the plaint that Bunder Road Branch of the defendant addressed a letter dated 16.8.2004 to the plaintiff No. 1 wherein it was wrongly stated that the Bill NIFBP/209/03- for USS 58,850/-, Pak Rs. 3219 million under UBL E No. 0859755 was long outstanding and their Head Office viewed seriously to settle the matter. The plaintiff No. 1 in response to the said letter dated 16.8.2004 of the Bunder Road Branch replied the said letter thereby referring the opinion of legal division of the defendant. The defendant received the said letter of plaintiff No. 1 but did not respond, therefore the plaintiff addressed another letter dated 23.12.2004 to the president of defendant, which was also received but did not respond, It is briefly stated that nothing were outstanding against the plaintiff and the business was past and closed chapter and in spite of the said end of the business the defendant did not return the original documents to the plaintiff, therefore, the plaintiff constrained to file the - suit for redemption of all the original documents as well as damages to the tune Of Rs. 99 millions against the defendant.
8. The defendant have served with the notice of this suit and after service of the notice, the defendant were required to obtain leave to defend the suit within the prescribed period but they did not file the requisite application seeking leave to defend the suit, and filed such application under Section 10 of the Ordinance, 2001 on 19.8.2006 along with the application under Section 5 of the Limitation Act praying therein for condonation of delay in filing the application for leave to defend the suit.
9. Notice of this application has .Been served upon the plaintiff, who has filed counter-affidavit, inter alia, denying the reasons assigned in the application filed under Section 10 of the Ordinance, 2001 and has also produced a copy of letter issued by the Metrological Department dated 7.9.2006.
10. I have heard learned counsel for the plaintiff. Learned counsel for the defendant called absent.
11. Learned counsel for the plaintiff vehemently contended that this suit has been filed under the Ordinance, 2001, and leave to defend the suit is to be obtained within thirty days from the date of the service and if the prescribed period provided under the statute expires, the defaulting party is required to submit explanation, of each day's delay in filing of the application for condonation of the said delay and according to him in his application, the defendant has not assigned any cogent, convincing and plausible reasons so as to condone the inordinate delay in filing the application under Section 10 of the Ordinance, 2001. According to him even the claim of the defendant is half- heartedly being refuted in the. Application under Section 10 of the Ordinance, 2001 and there is no such material available on record to show that any over due payment is outstanding against the plaintiff and had it been so, the defendant had not to hesitate to file suit for recovery of such alleged amount. He further contended that Section 5 of the Limitation Act is wholly inapplicable under the Ordinance, 2001, therefore on this score alone the application is not maintainable, In support of his contention he has relied upon the case of M/s. Friends International (Pvt.) Ltd.
12. Through Director and others Vs. ABL Limited through Manager and five others, reported in 2004 CLD 817 and the case of Yasir Chaudhary Vs. Zarai Taraqiati Bank Ltd., reported in 2005 CLD 1701.
13. I have considered the arguments advanced on behalf of the plaintiff and have gone through the material available on record in support of this application.
14. Admittedly the service was effected on the defendant on 15.6.2006 and the defendant was required to obtain leave to defend by filing application within thirty days of the date of first service, in view of sub-section (2) of Section 10 of Ordinance, 2001. The service on defendant on 18.6.2006 has not been refuted by the defendant in his application as such, the period of limitation to file application for leave to defend the suit will start from 19th June, 2006 and the defendant was under statutory obligation to file such application on or before 18th July, 2006 whereas the present application under Section 10 ibid, along with the present application has been filed on 19.8.2006 viz. After a delay of about thirty five days. The defendant in support of his application for condonation of delay base assigned the reason in the affidavit filed by Shahid Abdul Wodood that the service was effected on 15.6.2006 on their registered office and on or about 27.6.2006 Bunder Road Branch of the defendant Bank got flooded due to torrential rains and because of such difficulty, the entire record of the said branch had to be temporarily shifted in hasty manner, and because of such shifting the various documents could not be traced therefore the leave to defend application Could not be filed on first opening day of summer vacations. The said plea regarding torrential rains has not been supported with any material except the oral version of-the deponent, no order of the superior authorities of the bank showing the haste and hurry shifting of the record of Bunder Road branch to some other branch has been produced in support of the said contention raised in the affidavit of the manager of the defendant. The plaintiff has vehemently controverted the said assertion of having rain in the month of June, 2006 after service of summons on the defendant and has also produced a letter dated 7.9.2006 issued by Pakistan Metrological Department, Jinnah International Airport, Karachi whereby Assistant Meteorologist has stated monsoon for the year 2006 started in Karachi from 28th July, 2006, The said letter of the Meteorological Department has not been seriously disputed by the defendant. The genuineness and authenticity of the letter issued by the Metrological department dated 7.9.2006 therefore remain unshaken which shows that monsoon started in Karachi from 28th July, 2006 which completely negates the version of the defendant that Bunder Road Branch was flooded with torrential rains in the month of June, 2006. In such state of affairs, it appears that the plea raised in the month of June, 2006. In such state of affairs, it appears that the plea raised by the defendant in support of his application for condonation of delay appears to be false, fallacious and concocted which is raised by the defendant to mis-guide the Court, It is settled principle of law that in case, if specific time is provided in the statute to do or not to do certain act, the said acts are required to be done within the period provided under the statute and after expiry of the limitation period the valuable right accrued in favour of the opposite party which cannot be snatched leniently or lightly. It is also settled principle of law that after expiry of limitation period, each day's delay is to be explained so as to assess by the Court that delay in filing the -suit or application was beyond the control of defaulting party, In the present case, admittedly application under Section 10 of the Ordinance, 2001 has been filed along with this application on 19.8.2006 after the delay of 35 days and not a single day's delay has been explained in the affidavit filed in support of the application, except the vague plea of torrential rains, as such, I do not find any justification to condone the inordinate delay of 35 days in filing of the application.
15. The learned counsel for the plaintiff has raised the plea that Section-5 of the Limitation Act are inapplicable in the proceedings arises under the Ordinance, 2001. In support of his contention he has relied upon the case of M/s. Friends International (Pvt.) Ltd., supra, wherein it is observed that Section 5 of the Limitation Act are inapplicable to the proceedings under Ordinance, 2001. The relevant observation, in the aforesaid case, is reproduced hereunder, for the sake of convenience.
16. "Having failed to do. So within 21 days, the suit therefore, was liable to be decreed straightaway, as there was no valid application for leave to appear and defend before the Court on 23.10.2000 being barred by time, there was ho application for condonation of . Delay and even otherwise the provisions of Section 5 of the Limitation Act are inapplicable to the proceedings under the Ordinance."
17. In the case of Yasir Chaudhry, supra, the application under Section 10 of the Ordinance, 2001 was filed after expiry of statutory period provided under Section 10(2) of the Ordinance, 2001 and the said application was dismissed being barred by limitation. Observations recorded in the case of Yasir Chaudhry, supra are also applicable under the circumstances of the present case.
18. After perusal of the material available on record in order to condone the delay in filing of the application under Section 10 of the Ordinance, 2001. I am of the firm opinion that no reasonable and plausible grounds exist to condone the inordinate delay of 35 days in filing of application for leave to defend the suit by the defendant, as such no case for condonation of such inordinate delay has been made out by the defendant, the application merits no consideration, and is hereby dismissed.
19. Since the application for condonation of delay has been dismissed, as such the application under Section 10 of the Ordinance, 2001 (CMA No. 6166/2006) is also dismissed. Consequent upon the dismissal of the application for leave to defend the suit, the suit filed by the plaintiff is decreed to the extent of redemption of all the original title documents deposited by the plaintiff and mortgaged by the defendant. However, the suit claiming the damages by the plaintiff against the defendant could not be decreed summarily without recording the evidence, as such the suit claiming the damages by the plaintiff against the defendant will remain pending for disposal, in accordance with law.