' MAZHAR ALAM KHAN MIANKHEL, J.--- Through this single judgment being recorded in F.A.B. No,31 of 2008, we also intend to dispose of F.A.B. No,32 of 2008 as well as F.A.B. No,33 of 2008 arising out of the same subject-matter.
2. The impugned herein are the three even dated different judgments rendered by Judge Banking Court-II, N.-W.F.P, Peshawar, whereby the Judge Banking Court rejected the two suits for declaration under Rule 11 of Order VII of C.P.C. Which have been impugned through F.A. B. No,31 of 2008 and F.A. B. No,33 of 2008. The third suit is for the recovery of an amount of Rs,49,88,789 filed by the Bank against the loanee which was decreed in favour of the Bank against the loanee, the present appellant. Said judgment and decree has been impugned through F.A. B. No,32 of 2008.
3. The appellant, applied for finance assistance to the respondents-Bank in three different categories, one for Caterpillar Loader for an amount of Rs,45,00,000 to be recoverable in 60 monthly instalments of Rs,90,668 commencing from 24-5-2006 to 24-4-2011. The second finance facility applied for was a Vertical Machine for an amount of Rs,16,00,000 recoverable in 36 monthly instalments of Rs,46,195 each commencing from 23-9-2006 to 23-8-2009 and the third one was for a car Toyota Corolla 2.0 D. For Rs,12,79,000 to be recoverable in 60 monthly instalments of Rs,29,011 each commencing from 30-9-2005 to 1-9-2010. Accordingly, all the process in this regard was made by the Bank and eventually the above said finance facilities were provided to the appellant who for a certain period of time was regular towards payment of its instalments. After some time, his both machines, the Caterpillar Loader and the Vertical Machines developed some major problems for which he was unable to pay the monthly instalments. Resultantly he approached the concerned Bank Authorities and, as per appellant, on their oral assurance he made and cleared the car finance facility by making lump sum payment on the ground that his defaulted instalments would be deferred for certain period as asked for.
4. In spite of lump sum payment by the appellant, the Bank Authorities demanded the routine monthly payments instead of deferring the same for certain period as per their commitment. The appellant then filed two declaratory suits against the Bank wherein the Bank after putting appearance before the court, submitted its applications for leave to defend the suits and in the meanwhile, the Bank also filed a suit for recovery of remaining finance facility regarding the above said two machines wherein the present appellant also filed his application for leave to defend the suit.
5. After hearing the parties, the learned Judge Banking Court-II, N.-W.F.P., Peshawar vide his three separate even dated judgments of 30-8-2008, rejected the plaints of the appellant under Rule 11 of Order VII of C.P.C. And accordingly refused leave to defend the suit filed by the Bank whereas the recovery suit of the Bank was decreed to the extent of entire claim made by the Bank without considering the points legal as well as factual raised by the loanee/appellant in his application for leave to defend and without disposing of the application for leave to defend the suit.
6. Learned counsel for the appellant submitted that the rejection of his plaints by the Learned Judge Banking Court is not warranted under the law as under section 10(11) of the Financial Institutions (Recovery of Finances) Ordinance, 2001, (the Ordinance), the refusal of leave to defend the suit will oblige the court to pass a decree in the suit; the respondents Bank was bound to honour its oral commitment whereupon the appellant had made lump sum payment in car finance facility and had cleared that loan on their assurance for deferment of monthly instalments for certain period. He further submitted that claim of the respondents-Bank in its recovery suit is also against the record and law as it was a premature claim and all the finance facilities were yet to mature; the judgment and decree in recovery suit would reveal that it would have been a claim of the Bank after maturity of the finance agreement; the Judge Banking Court failed to consider and give its findings with regard to material factual and legal points raised in his petition for leave to defend which again is a material irregularity. His last and final argument was that the Judge Banking Court was required under the law to determine that as to how much amount of mark-up was to be paid by the loanee/appellant as the suit was brought before the maturity of agreed finance period and decretal of entire amount which was to be paid at the time of its maturity of the loan is illegal and unlawful and the result of unlawful exercise of jurisdiction.
7. As against that, the learned counsel for the respondents Bank vehemently refuted the submissions made by the learned counsel for the appellant by submitting that all the three appeals of the appellant are hopelessly time-barred which required outright dismissal on the question of limitation alone. He further submitted that the declaratory suits of the appellant being unlawful and not disclosing any cause of action were rightly rejected whereas the recovery suit of the Bank was rightly decreed as the finance facilities availed by the appellant were admitted by him for which he was legally and morally bound to pay back the same and thereby supported the judgment and decrees passed by the learned Judge Banking Court by submitting that all the three judgments and decrees are based on the proper appreciation of law and material available on the record.
8. We have heard the learned counsel for the parties and have gone through the record of the case which would reveal that the finance facilities availed by the appellant were admitted by him and he as per entries reflecting in the statement of accounts admittedly paid certain monthly instalments. It would further reveal that both the above referred machines were provided by the Bank against the finance facilities so, as per agreement between the parties, would remain in the name of the Bank unless the outstanding amount of the finance facilities was paid. Said both machines were insured by the Bank and in case of any claim by the loanee, Bank would be bound to refer the same to the insurance company. The perusal of the declaratory suits would reveal that certain payments other than monthly instalments were made by the appellant and similarly he also cleared his third finance facility of car and as per appellant it was just because of oral assurance of the respondents-Bank. Against the two declaratory suits of the appellant, the Bank filed a petition under section 10 of the Ordinance by raising certain factual and legal pleas. The Judge Banking Court was under the legal obligation to consider all the factual and legal pleas raised in the application. Under the law, the Banking Court after considering the same is bound to pass a judgment and decree in favour of the plaintiff if the application for leave to defend the suit is rejected or the defendant has failed to fulfil the conditions attached to the grant of leave to defend. Under the settled principle of law any such order/decision should be based on due application of mind and with reasons. The perusal of the impugned judgment in declaratory suits reveal that the same is without the above said requirements. The last relevant para is reproduced below:--- "It appears that the payment of loan to the plaintiff is not denied. It is also not denied that some of instalments were paid. The defendants-company cannot be held liable for damage caused to the Cater Piller Loader in use of plaintiff. As such the present suit discloses no cause of action. Hence leave to defend is accordingly refused and the plaint is rejected under Order VII, Rule 11, C.P.C."
' Instead of giving its findings on the application for leave to defend the suit, leave was outrightly refused and in the same breath, the plaint of the suit of plaintiff/appellant was rejected under Rule 11 of Order VII of C.P.C. Whereas in case of refusal of leave to defend, under section 10(11) of the Ordinance, the Judge Banking Court was required to pass a decree. If at all the suit of the plaintiff was not competent, then the same should have been dealt with under the law. Outright rejection of the plaint in such a cursory manner without discussing and considering the pleas raised by the parties is nothing but an exercise of jurisdiction against the law and is a material irregularity and illegality.
9. Similarly, while considering the recovery suit filed by the Bank, the loanee/appellant filed his application for leave to defend. The judgment of the learned Judge Banking Court though has referred to all the allegations factual as well as legal raised by the appellants in his application but rest of the entire judgment is silent with regard to the consideration of the same with due application of mind. Similarly, the findings of the learned Judge are also in a slipshod and cursory manner as the learned Judge" failed to determine the actual amount to be payable by the loanee.
As the record of the case would reveal the recovery suit against both the finances was premature and by now too the term of one finance facility is yet to expire in the next year. But the entire claim of the Bank including the remaining period of the finance was decreed. The suit was decreed without giving any reasons. In this view of the matter, there are certain questions legal as well as factual raised by the appellant which were required to be answered by the learned Judge.
10. Unless the pleas raised in the application for leave to defend the suit and such type of questions are answered, the findings of the learned Judge Banking Court cannot be termed tq be legal one.
So, we have no option left with us but to accept the appeals and send back the cases to the Banking Court to re-determine the cases in the light of the observations made above and relevant law and record of the case and then to decide afresh.
11. We are conscious of the fact of time-barred appeals but the reason mentioned in the application for condonation of delay as because of insurgency in the area, the appellant was unable to file the appeals within the time and unrebutted affidavits in this regard and also keeping in view the important questions of unlawful exercise of jurisdiction by the forum below, we would allow these applications by condoning the delay in filing of appeals and hereby set aside the judgment and decrees of the learned Judge Banking Court in the above terms.