1. ' BHAJANDAS TEJWANI, J.--- This is an application for quashment of proceedings under sections 489-F, 420, P.P.C. Initiated through F.I.R. In Crime No,25 of 2009 of Police Station .Town, Mirpurkhas.
2. During investigation, the charge sheet of the case was submitted by police the same is sub judice as Case No,82 of 2009 before the Court of learned Civil Judge and Judicial Magistrate-I, Mirpurkhas. The applicant has also assailed the order dated 26-5-2009 passed by learned Judicial Magistrate refusing acquittal under section 249-A and order dated 14-9-2009 passed by learned IInd Additional Sessions Judge, Mirpurkhas, maintaining the order of learned trial Court.
3. ' The brief facts giving rise to this application are that the applicant being a Chief Executive of Messrs Gold Star Paper Mill (Private) Limited, Mirpurkhas, availed the Demand finance facility of fifty millions and Rs,20.000 Million as cash finance limit from the National Bank of Pakistan main Branch Mirpurkhas against security/ies of mortgage of property and structure of the mill. The said facility was repayable with mark up in terms of sanction advise and other documents executed by the borrower mill and its directors including the applicant.
4. ' The applicant's company committed default in fulfilment of the obligation and adjustment of financial liability and thereafter as per allegation in the F.I.R., the applicant issued four post dated cheques of Rs,10,00,000 each towards the adjustment of the said liability but the same were dishonoured on presentation as required balance was not available in the account of applicant's mill. Therefore, the complainant Nazeer Ahmed Lund, the Manager of NBP filed an application under section 22-A and B, Cr.P.C. Before the learned Ex-Officio Justice of Peace/Sessions Judge, Mirpurkhas which was allowed and the F.I.R. In Crime No,25 of 2009 was lodged at Police Station Mirpurkhas under sections 489-F and 420, P.P.C. And after routine investigation, the same was challaned in the trial Court.
5. ' The applicant moved an application under section 249-A, Cr.P.C. For his acquittal from the case on the ground that offence, if any, committed by him was subject to provisions of section 20 of Financial Institutions (Recovery of Finances) Ordinance (XLVI of 2001), which is non-cognizable and the same provides for filing a complaint in the concerned Banking Court having jurisdiction in the matter and the cognizance taken by the police was without lawful authority and thereafter, continuation of proceedings against the applicant before the trial Court was abuse of process of the Court. The said application for acquittal of the applicant was dismissed by the trial Court on 26-5-2009 by holding that it has jurisdiction in the matter. Thereafter, applicant approached the Court of learned Sessions Judge, Mirpurkhas by filing a Criminal Revision No,11 of 2009 but the same was also dismissed by learned II-Additional Sessions Judge, Mirpurkhas by its order dated 14-9- 2009, hence this Criminal Miscellaneous Application for quashment of proceedings under sections 420 and 489-F, P.P.C. Pending against the applicant before the Court of learned Judicial Magistrate-I, Mirpurkhas and so also for setting aside of two orders dated 26-5-2009 and dated 14- 9-2009 passed by learned trial Court and as learned IInd Additional Sessions Judge whereby the application for acquittal of applicant was not allowed and same findings were upheld in Criminal Revision No,11 of 2009 filed by applicant.
6. ' I have heard learned counsel for the applicant, learned counsel for respondent No,1 and learned D.P.G. So also perused the material available on record.
7. ' It is contended by learned counsel for the applicant that admittedly the applicant's company is a customer/borrower of the Financial Institution i.e. National Bank of Pakistan in terms of section 2 of Ordinance XLVI of 2001 and the said Ordinance is a complete code and provide full mechanism for dealing such cases, According to him, the section 20 of the said Ordinance provides remedy in respect of the offences committed by borrowers/customers of the Bank who commits any fraudulent act, attempts to make a false statement or commits any breach of an obligation including the act of dishonouring of cheque. Therefore, according to him, the only jurisdiction for trial of such offences lies with the concerned Banking Court in terms of section 20 of the said Ordinance and the said section is non-cognizable, bailable and compoundable therefore, according to him, the proceedings initiated under sections 489-F and 420, P.P.C. Are without lawful authority and abuse of process of the Court, are liable to be quashed. The learned counsel has placed reliance on the case of Muhammad Iqbal S.H.O. Police Station Haji Pura, reported in PLD 2009 Lah. 541 and case of Nizar Ali Fazwani v. Messrs Pak Golf Lease Committee Limited, reported in 2009 PCr.LJ 325.
8. ' Mr. N.H. Pirzada, learned counsel for the respondent No,1 has seriously opposed the above application and has contended that in this case, the applicant has cheated the Bank by not adjusting the huge outstanding amount of more than 73 millions and for recovery of this amount, the Bank has filed a Suit No,P.9T of 2008 before this. Court and according to him, the only remedy available with the Bank was to get prosecuted the applicant under the ordinary law under the provisions of sections 489-F and 420, P.P.C. Therefore, the application for quashment of proceedings filed by the applicant is based on mala fides and the learned Court of Judicial Magistrate has rightly taken cognizance in the matter on the F.I.R. Lodged by police. The learned counsel for respondent No,1 has relied on the case of Liaquat Hussain v. The State, reported in 2009 MLD 1167 in which the quashment of proceedings was declined by the High Court on the ground that the plea taken by accused was that the cheques were got under the coercion.
9. ' In case of Nizar Ali Fazwani v. Messrs Pak Gold Leasing Company reported in 2009 PCr.LJ at page 325, the F.I.R. Under section 489-F, P.P.C. Was lodged against the customer of Financial Institution Messrs Pak Gold Leasing Company Limited on the basis of a cheque which was issued for repayment of loan and same was dishonoured. The party approached this Court for quashment of the F.I.R. On the ground that the offence, if any, was non-cognizable and it was urged that subsection (4) of section 20 of the Ordinance, 2001 will be attracted in the instant case and the F.I.R.
10. In the matter cannot be lodged and consequently the F.I.R. Was quashed, while in case of Muhammad Iqbal v. S.H.O. Police Station Haji Pura reported in 2009 PLD Lah. 541 the F.I.R. Lodged against the customer/borrower on account of dishonour of cheque issued towards adjustment of the financial liability was quashed on the ground that provisions of said section 489-F, P.P.C.
11. Relating to ordinary law were not applicable and that same has no nexus with provision of special enactment as envisaged in Ordinance, 2001, which provides separate and independent mechanism and in view of such matter the F.I.R. Lodged against the borrower/customer by Messrs United Bank Limited was quashed holding that the F.I.R. Cannot be lodged against the persons issuing the cheque towards fulfilment of the obligation with the financial institution and that the accused cannot be prosecuted under section 489-F, P.P.C. And the prosecution, if any, against the customer of the Bank or financial institution can only be initiated by invoking the provision of subsection 4 of section 20 of Ordinance, 2001. The case-law reported in 2009 MLD 1167 cited by learned counsel for respondent No, 1/complainant is not applicable in the instant case, as in that case the transaction of alleged cheque was between two private persons and the accused was alleged to have issued the same in fulfilment of certain obligation but the same was dishonoured and in view of such position, it was held by the Lahore High Court, Lahore that the prosecution of person on dishonour of such cheque can be maintained under section 489-F, P.P.C.
12. ' Learned D.P.G appearing for the State has conceded the legal position that the offence with which the applicant can be charged, will fall under section 20 subsection (4) of the Ordinance, XLVI 2001, in which the cognizance can only be taken by the concerned Banking Court, having jurisdiction in the matter on the complaint lodged on behalf of Financial Institution and prosecution of applicant by way of F.I.R. And application of sections 489-F and 420, P.P.C. Was illegal and cannot sustain.
13. It is an admitted position that the applicant being a Chief Executive of the borrower mill, availed demand and cash finance against various, securities including the mortgage of Unit/Mill of the company and in fulfilment of the obligation and in order to adjust the outstanding liability/ies, he has issued four post dated cheques but the same were not encashed and were dishonoured and on commission of such offence, the Manager of the Bank proceeded against the applicant and launched the prosecution through F.I.R. By application of sections 489-F and 420, P.P.C. Neither the police determined its authority nor the learned trial Court while taking the cognizance by accepting the F.I.R. And challan, did not advert to its jurisdiction.
14. The Financial Institutions (Recovery of Finances) Ordinance (XLVI of 2001), is a complete code in respect of transactions between the financial institution and the customer which are defined by section 2(a) and (c) of the said Ordinance while section 7 of the said Ordinance provides the powers of the Banking Court. The proviso of section 7(a)(b) stipulates as under:--
(a) in the exercise of its civil jurisdiction have all the powers vested in Civil Court under the Code of Civil Procedure (V of 1908);
(b) in the exercise of its criminal jurisdiction, try offences punishable under this Ordinance and shall, for this purpose have the same powers as are vested in a Court of Session under the Code of Criminal Procedure (V of 1898): ' Provided that a Banking Court shall not take cognizance of any offence punishable under this Ordinance except upon a complaint in writing made by a person authorized in this behalf by the financial institution in respect of which the offence was committed.
15. ' Apart from the above, subsection (4) of said section 7 further speaks about the exercise of jurisdiction of the Banking Court which is reproduced as under:--- "(4) Subject to subsection (5), no Court other than a Banking Court shall have or exercise any jurisdiction with respect to any matter to which the jurisdiction of a Banking Court extends under this Ordinance, including a decision as to the exercise or otherwise of a finance and the execution of a decree passed by a Banking Court."
16. For trial of the offence, section 20 of the said Ordinance has been incorporated which relates to the various type of offences to be dealt with by the said section and its subsection (4) provided the remedy for a financial institution where the cheque is dishonestly issued and same is ,not encashed or dishonoured having insufficient balance in the account. In order to appreciate, the said subsection (4) of section 20 is reproduced as under:--- "Whoever dishonestly issues a cheque towards repayment of a finances or fulfilment of an obligation which is dishonoured on presentation, shall be punishable with imprisonment which may extend to one year, or with fine or with both, unless he can establish, for which the burden of proof shall rest on him, that he made arrangements with his bank to ensure that the cheque would be honoured and that the bank was at fault in not honouring the cheque."
17. The above proviso of Financial Institutions (Recovery of Finances) Ordinance (XLVI of 2001), clearly envisages that in given situation or any other offence as embodied in section 20 committed by the customer of the bank shall only be subjected by the above mandate of law by way of filing direct complaint as mentioned hereinabove and as defined in section 4(h) of the Criminal Procedure Code in the Banking Court having jurisdiction and that police has no authority to book a person by lodging the F.I.R. And taking cognizance in the matter on the basis of F.I.R. Lodged by police and jurisdiction assumed by the Court of learned Judicial Magistrate-I, Mirpurkhas is without lawful authority and coram non judice.
18. ' Apart from the above, it may also be observed that in such situation when the Financial Institutions (Recovery of Finances) Ordinance (XLVI of 2001), provides the specific provisions and punishment under section 20 of the said Ordinance and having no nexus with the provisions of sections 489-F and 420, P.P.C. Which have been defined as cognizable and non-bailable, therefore both the provisions and enactments being entirely different, cannot be agitated together. The purpose and object of Ordinance, 2001 was totally different one, the same being special enactment has also overriding effect on the ordinary law therefore, the borrower or customer of the bank cannot be proceeded with under the provisions of Pakistan Penal Code and only remedy available for the Bank and Financial Institution was to invoke the provisions of section 20 by filing the direct complaint in terms of proviso of section 7(1)(b) of the said Ordinance and the prosecution of the applicant under sections 489-F and 420, P.P.C. On the basis of F.I.R. Was abuse of process of the Court and without lawful authority.
19. For the foregoing reasons, this application is allowed. The impugned order dated 26-5-2009 passed by learned Judicial Magistrate-I and Order dated 14-9-2009 passed by learned Iind Additional Sessions Judge, Mirpurkhas are set aside. The proceedings pending in case No,82 of 2009 under sections 420 and 489-F, P.P.C. Before learned Judicial Magistrate-I, Mirpurkhas against the applicant being untenable, coram non judice, without any lawful authority and abuse of the process of the Court are hereby quashed.