' MUNIB AHMAD KHAN, J.---These appeals have been filed against the judgment dated 1-8-2001, passed by the Banking Court No,1, Karachi in Suit Nos.667 of 2000 and 674 of 2000.
2. The factual position coming on record is that the respondents in both the cases were employees of the Bank and they were given HBFC loan on certain terms and conditions while they also obtained Over Draft facility by fraudulent means. The trial Court decreed the suits for HBFC loan as there was admission on the part of the employees that they have obtained loan amount, therefore, remaining amount was ordered to be paid. Regarding Over Draft Facility the Banking Court did not agree with the contention of the Bank on the ground that overdraft matter cannot be brought before the Court as that was obtained by fraudulent means and against that fraud a complaint in the Banking Court, Offences in Respect of Banks (Special Court) Ordinance, 1984 had been filed and that was proceeding. Now learned counsel submitted that the Over Draft Facility also falls within the meaning of section 2(0(i) of the Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997 while the respondents were also customers within the meaning of section 2(d). Learned counsel submits that since there was a liability against the employees and the Bank has been deprived of the money, therefore, that amount could have been decreed.
3. After hearing the learned counsel, we have perused the order of the Court, where, the contention of the Bank has been recorded, which is as follows:-- "The defendant had also opened a Saving Account No,01-103-2039-2 and fraudulently availed huge temporary overdrafts in his account with the result a total sum of Rs,1,07,13,476/17 is due against him, as such plaintiff filed this suit and prayed for a decree in the sum of Rs,1,14,20,013/72 and for the sale of mortgaged property bearing No,3/349, Liaquatabad, Karachi Mark-up at 58 paisas per thousand per day from the date of filing of the suit till realization with cost."
4. The trial Court, after hearing the learned counsel, has given his finding as follows:- "As regards temporary Overdraft Facility is ,concerned, the defendant is neither a borrower nor a customer under the definition of section 2(c) and 2(d) of the Banking Companies (Amendment)
Act, 1997. Section 2 defines what borrower, customer and Finance means and includes. These definitions say that loan or Finance obtained under a system. According to the plaintiff Facility or loan as regards Temporary Over Draft is concerned has not been obtained by the defendant under a system but has been fraudulently availed.
' An Ordinance to provide speedy trial of certain offences committed in respect of Banks was promulgated on 23rd February, 1984, and Special Courts were created to deal with the Offences mentioned in the First Schedule of the Ordinance. The First Schedule includes the following offences of Pakistan Penal Code sections 202, 204, 217, 218, 380, 403, 406, 408, 409, 419, 420, 467, 468, 471, 472, 473, 475 and 477-A.
' The plaintiff has levelled allegations of fraud and forgery which falls under the First Schedule for which the Bank had already filed a suit against the defendant in the Special Court dealing with the offences committed with regard to the banks. Under section 6 subsection (3) of the Ordinance IX of 1984, offences in respect of Banks where the Special Court finds the offences to have been committed in respect of a specified amount the fines: shall not be less than twice the said amount.
Under subsection (4) the Court shall order the whole or any part recovered to be applied in the payment to the Bank for the loss caused.
' Therefore in my opinion where the fraud or forgery is committed by the Bank employees or any one else with Bank the jurisdiction lies with the Court dealing with the offence committed with the Bank. Therefore this Court has no jurisdiction as regards the alleged Temporary Over Draft Facility."
5. After hearing the learned counsel, it appears that it has not been disputed that a criminal case in the Court constituted under the Banking Law of Offences in Respect of Banks (Special Court)
Ordinance, 1984 has been filed and is proceeding. We have also perused the definitions of sections 2(d) and 2(0(i), as pointed out by the learned counsel, which are as follows:--
2. Definitions..........
(a)
(b)
(c) ...................
(d) "customer" means a person who has obtained finance under a system which is not based on interest from a Banking Company or is the real beneficiary of such finance and includes as surety or any indemnifier.
(e)
If) "loan" means a loan, advance and credit under a system based on interest and includes---
(i) an advance, cash credit, overdraft, packing credit, a bill discounted and purchased or any other financial accommodation provided by a Banking Company to a borrower."
6. In the circumstances, we have observed that the Over Draft Facility was not a voluntary facility by the bank nor there was permission or condition nor any interest rate while according to the Bank itself it was obtained by fraud and the fraud cannot be an element within the business of banking system, therefore, it is out of legal business transaction for which admittedly a criminal case has been filed. We have not been satisfied with the arguments of the learned counsel for the appellant that even fraudulent actions of the employees or any person out of the Banking system fall within the jurisdiction of the Court. The reason given by the Banking Court is plausible and just and we concur that opinion, hence, both the appeals have no force and are accordingly dismissed.