MUHAMMAD TASNIM, J.---The plaintiff has filed present suit on the basis of Judgment passed by the Court of United Arab Emirates.
2. The facts leading to the present suit are summarized as under.
3. That plaintiff is financial institution in terms of provisions of Financial Institutions (Recovery of Finances) Ordinance, 2001 (hereinafter called "Ordinance 2001") having its registered office at Habib Bank Tower, Jinnah Avenue, Blue Area, Islamabad and its branches in Pakistan as also abroad including one of its branches at Diera Branch Dubai, United Arab Emirates. It is stated in the plaint that defendant No,1 is limited company incorporated and licensed in Sharjah, United Arab Emirates and defendants Nos.2 and 3 are individuals. It is the case of the plaintiff that at the request of defendant No, 1, plaintiff granted finance facility in the sum of AED 4850,000 to the defendant No,1 in their account No, 300-5105-84, which to be repaid to the plaintiff with interest of 12% per annum. Defendants Nos.2 and 3 stood guarantors for the above finance facility. In addition to the above guarantees defendant No,1 executed and delivered demand promissory note dated 23-6-1996 for an amount of AED 4850,000. As per plaint defendants utilized the finance facility in full, but did not repay the amount as agreed between the parties and at the time of filing of legal proceedings against the defendants an amount of AED 2,485,209/29 was recoverable from the defendants by plaintiff along with interest of 12% per annum. Accordingly a lawsuit being Lawsuit No,20 of 1999 was filed by the plaintiff before Sharjah Federal Court of First Instance (hereinafter called as "Original Court"), The Original Court heard the parties and after perusing the record, per judgment dated 30-5-2001, ruled as under:- ''......... The Court ruled in presence for the second defendant and deemed in presence for the rest of defendants by:-- Firstly deny the demand of the second defendant to reject the law suit for lack of capacity.
Secondly: to abide the defendants: Bahjan Scrap Trading Co., Farouq Mohamed Abdul Raheem, Allah Rakha Mohamed Sidiq and Abdul Ghuffar Haji Mohamed To pay to the defendant Habib Bank Ltd. Jointly a sum of AED 918,336.58 and the agreed interest at 12% per annum from 21/2/99 till full repayment and to abide all the expenses and fees with AFD 300 as advocate fees."
4. Defendant No,2 felt himself aggrieved against the aforesaid original judgment and filed an Appeal No,600 of 2001 before the Sharjah Federal. Appeal Court (hereinafter called as "Appellate Court"), whereas present plaintiff also filed an appeal before the Appellate Court being Appeal No,593 of 2001.
5. The appellate Court after hearing the parties ruled as under:- "........ The court has ruled by: Firstly: in Appeal No,600 of 2001 submitted by Farouq Mohamed by cancelling the rule for the appellant and to deny the law suit against him for lack of capacity and to abide the bank, Habib Bank Ltd. By fees and AED 300 as advocate fees.
Secondly: in Appeal No,593 of 2001. Submitted by Habib Bank Ltd. To change the amount ruled by to be AED 2303171 and to abide Bahjan Scrap Trading Co., Allah Rakha Mohamed Sidiq and Abdul Ghuffar Haji Mohamed to pay the same jointly to Habib Bank Ltd, the plaintiff and to pay the reasonable expenses and AED 300 for advocate fees."
6. In spite of the above judgment of the appellate Court defendant neglected to pay the decretal amount to the plaintiff instead they shifted to Pakistan hence for the recovery thereof present suit has been filed by plaintiff under the provisions of Ordinance 2001, praying therein for judgment and decree in favour of plaintiff and against the defendants jointly and severally in the sum of AED. 4,606,342 along with costs of funds as determined by State Bank of Pakistan on the decretal amount from the date of default till realization so also costs of the suit. Break-up of their claim has been shown in para.11 of the plaint which is as under:-- Head Outstanding amount (A.E.D.)
Total finance availed by the defendant No.1. (as per Foreign Judgment) 2,303,171 Amount repaid. NIL Mark-up allowed by the Foreign Judgment @ 12% per annum From 21-12-1999 to 31-7-2010 2,925,027 Other costs allowed by the Foreign Judgment: Reasonable Expenses Advocates Fee (UAE) Advocates Fee (Pakistan) 300 8,695 Total AED 5,237,193 Recoverable as per UAE law (Total amount of interest cannot be more than the amount of finance proved and determined against defendant)AED 4,606,342
7. Summonses of the suit were sent through Registered Post, Courier Service to the defendants and also publication was effected in daily "JANG" Lahore and daily "JANG" Karachi and daily "DAWN". All the publications were effected on 21-10-2010.
Service against the defendants has been held good in accordance with law but no application under section 10 of the Ordinance, 2001 has been filed by the defendant seeking leave to defend the suit. Accordingly this matter has been fixed in Court for final disposal.
8. Mr. Muhammad Jamshid Malik, the learned counsel for plaintiff has invited my attention to section 2(a) of the Ordinance, 2001, and contended that under the aforesaid provision a financial institution means and includes any 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 and includes a Government Savings Bank but excludes State Bank of Pakistan. While referring to section 2(a) of the Ordinance 2001 learned counsel contended that Diera Branch Dubai, United Arab Emirates of Habib Bank Limited is banking company and default in fulfilment of any obligation can be adjudicated upon by the Banking Court established under Ordinance, 2001. Learned counsel further submitted that instant suit was filed against the defendants on the basis of the decree of the Court of first instance and the judgment passed by the Appellate Court. He further submitted that on failure on the part of the defendants to satisfy the foreign judgment and decree of the Court of competent jurisdiction has given cause to the plaintiff to institute instant suit against the defendants. Learned counsel further argued that this Court has jurisdiction to pass decree on the basis of foreign judgment. He further submitted that a decree on the basis of foreign judgment can be passed, only restraint in this regard is the exceptions mentioned in section 13 of C.P.C.
9. Learned counsel for plaintiff has submitted that plaintiff has successfully established its claim against defendants before the Appellate Court and still defendants have failed to discharge their liability in terms of decree passed by the foreign Court.
Learned counsel for plaintiff further submitted that decree passed in United Arab Emirates cannot be enforced under the provisions of section 44A of C.P.C., hence appellate judgment has given the cause of action to the present plaintiff for filing of present suit. Learned counsel has referred the following case law in support of his submissions:-
(1) Habib Bank Ltd. v. Messrs Virk House Trading Company Ltd. (2009 CL D 451)
(2) United Bank Limited v. Naeem Ullah Malik and others (2009 CLD 1459)
(3) Mian Nazir Ahmed v. Abdur Rashid Qureshi (1986 CLC 1309)
(4) Ganguli Engineering Ltd. v. Smt. Sushila Bala Dasi and another (AIR 1957 Cal. 103)
(5) Popat Virji v. Damodar Jairam (AIR 1934 Bombay 390)
(6) Emirates Bank Intl. Limited v. Messrs Osman Brothers and others (1990 M LD 1779)
(7) Messrs Kadir Motors (Regd.), Rawalplidi v. Messrs National Motors Ltd., Karachi and others (1992 SCM R 1174),
(8) T. Zubair Limited and 2 others v. Judge, Banking Court Lahore and another (2000 CLC 1405) and
(9) Abdul Ghani v. Haji Saley Muhammad (PLD 1960 (Karachi) 594).
10. I have heard the learned counsel for plaintiff and have perused the record with his assistance.
11. It will be appropriate to first take up the question of jurisdiction of this court over subject-matter. As per plaint the defendants availed the finance facility in United Arab Emirates and executed documents in consideration of the finance facility availed by them. After having failed in discharge of their obligation, plaintiff was forced to initiate the legal proceedings in United Arab Emirates. The finance facility availed by the defendants comes within definition of Finance as defined in section 2(d) of Ordinance 2001, which provides that finance includes an accommodation or facility provided on the basis of participation in profit and loss, mark-up or mark-down in price, hire-purchase, equity support, lease, rent-sharing, licensing charge or fee of any kind, purchase and sale of any property including commodities, patents, designs, trade marks and copy rights, bills of exchange, promissory notes or other instruments with or without buyback arrangement by a seller, participation term certificate, musharika, morabaha musawama, istisnah or modaraba certificate, term finance certificate; facility of credit or charge cards; facility of guarantees, indemnities, letters of credit or any other financial engagement which a financial institution may give, issue or undertake on behalf of a customer, with a corresponding obligation by the customer to the financial institution; a loan advance, cash credit, overdraft, packing credit, a bill discounted and purchased or any other financial accommodation provided by a financial institution to a customer; a benami loan or facility that is a loan or facility the real beneficiary or recipient whereof is a person other than the person in whose name the loan or facility is advanced or granted; any amount due from a customer to a financial institution under a decree passed by a Civil Court or an award given by an arbitrator; and any amount due from a customer to a financial institution which is the subject-matter of any pending suit, appeal or revision before any Court any other facility availed by a customer from a financial institution.
12. The plaintiff is banking company and transacts banking business within and outside Pakistan through its branches hence it comes within definition of financial institution as provided under section 2(a) of the Ordinance 2001. The plaintiff is financial institution and the defendants are customers. The transaction between the plaintiff and the defendants creates a relationship of customer and financial institution. Where a customer or a financial institution commits a default in fulfilment of any obligation with regard to any finance the financial institution or as the case may the customer may institute a suit in Banking Court in terms of provisions of section 9 pf the Ordinance, 2001. The subject-matter, therefore, exclusively falls within the jurisdiction of Banking Court created under the Ordinance, 2001. Defendant No, 2 is also residing in Karachi at the time of filing of suit. In the circumstances, this Court while exercising jurisdiction under Ordinance, 2001 has jurisdiction to entertain this suit.
13. The point as to whether a suit of the similar nature is to be entertained in the original civil jurisdiction of this Court or the same is to be dealt with in the banking jurisdiction of this Court has come up for consideration in the case of Emirates Bank International Ltd. (supra); wherein learned Single Judge of this Court while considering provisions of the Banking Companies (Recovery of Loans) Ordinance, 1979 came to the conclusion that provisions of section 13 of C.P.C. Does not contain anything, which has the effect of excluding the provisions of the Banking Companies (Recovery of Loans) Ordinance, 1979 to a suit on foreign judgment. My above findings are supported by aforesaid judgment so also the findings recorded by learned Single Judge of Lahore High Court in cases of United Bank Limited (supra) and Habib Bank Ltd. (Supra).
14. In .The case of United Bank Limited (supra) while entertaining a suit in the Banking Jurisdiction of High Court learned Judge observed as under:- 11 7. I will first take up the question of jurisdiction of this Court, over subject-matter and the jurisdiction of this court over the parties. The facilities which the defendants availed are based on agreement dated 7-5-1994, which is signed and executed by United Bank Ltd. Dubai on one hand and Mr. Shahid Afzal Daha and Naeemullah Malik, on the other hand. Notary Public has also signed and attested this document. The defendants are shown as guarantors in this agreement. The defendants availed Clean Over Draft Facility, Loan against Trust Receipt, Local Bill Discounted Letter of Credit, Payment Against document and letter of Guarantee. These transactions pertain to "Finance'as defined in section 2(e) and create Banker Customer relationship. The transaction inter se the parties and also the subject-matter of the agreement dated 7-5-1994, falls within the ambit of definition of "Finance" as defined in section 2(e) of the Financial Institutions (Recovery of Finances) Ordinance.
2001.
The plaintiff is a banking company and transacts the banking business. Financial Institution which transacts banking business and is incorporated within or outside Pakistan is the "Banking Company" within the meaning of section 2(a) of Ordinance, 2001. The plaintiffis banker and the defendants are customers. The default of the defendants in payment of the outstanding ,amount is non-fulfilment of obligation. The subject-matter, therefore, exclusively falls within the jurisdiction of this Court. No other Court except this court, constituted under section 7 of the Ordinance, 2001, has jurisdiction over the parties and the subject-matter. "
15. Same Learned Single Judge of Lahore High Court in the case of Habib Bank Ltd., (supra) has considered the foreign judgment treating it as cause of action and conclusiveness of the foreign judgment and while dealing with the point in issue has observed as under:- "The Bench of three Judges headed by Dr. Hassan Basuni (President) of the court of the First Instance in Commercial Plenary Jurisdiction, examined the documents, went through pleadings and other relevant record, held the defendants liable for the payment of the suit amount. Learned court considered Account opening Application, Trust Receipt of debt dated 31-12-1997 and copy of the statement of account dated 10-5-1998 and then determined the liability of the defendants. The judgment by all intents and purposes is a judgment on merit. The liability of the defendants was directly adjudicated upon. Learned Dubai Appellate Court held defendants Nos.2 and 3 jointly liable for the payment of the suit amount. The certified copies of the foreign judgments along with their translation, are available on record. The judgments are presumed to be pronounced by the court of competent jurisdiction within the contemplation of section 14 of C.P.C. The defendants have failed to rebut the presumption. There is nothing on record to show that foreign judgments, upon which the plaintiff has filed the suit fall within the exception enumerated in section 13, C.P.C. The judgment is conclusive and binding on the defendants and this court while entertaining the claim on the basis of foregoing judgment cannot sit in appeal, over findings and conclusions of the fact, recorded by the Foreign Court."
16. For examining the scope of provisions of section 13, C.P.C. It will be advantageous to quote section 13, C.P.C., hereunder:-- "13. When foreign judgment not conclusive.---A foreign judgment shall be conclusive as to any matter thereby directly adjudicated upon between the same parties or between parties under whom they or any of them claim litigating under the same title except---
(a) where it has not been pronounced by a court of competent jurisdiction;
(b) where it has not been given on the merits of the case;
(c) where it appears on face of the proceedings to be founded on an incorrect view of International Law or a refusal to recognize the law of (Pakistan) in cases in which such law is applicable;
(d) where the proceedings in which the judgment was obtained are opposed to natural justice;
(e) where it has been obtained by fraud;
(t) where it sustains a claim founded on a breach of any law in force in Pakistan)."
17. A perusal of above quoted provisions of C.P.C. Would show that the foreign judgment shall be conclusive as to any matter thereby directly adjudicated upon between the same parties or between parties under whom they or any of them claim litigating under the same title except where it has not been pronounced by a court of competent jurisdiction. The other exception is where judgment has not been given on the merits of the case. It further provides an exception where it appears on face of the proceedings to be founded on an incorrect view of International Law or a refusal to recognize the law of Pakistan in cases in which such law is applicable. Further exception is where the proceedings in which the judgment was obtained are opposed to natural justice and/or where it has been obtained by fraud and further provides an exception that where such foreign judgment sustains a claim founded on a breach of any law in force in Pakistan.
18. Upon obtaining a foreign judgment by a plaintiff three courses are open to such plaintiff, firstly he can obtain exception of the foreign judgment by proceeding under section 44-A, C.P.C., if the country from which the decree has been obtained is United Kingdom or any reciprocating territory and in that case he can outright obtain execution of that decree from the District Court of the concerned District of Pakistan and that he need not file a suit even and need not go through the procedure prescribed for the trial of the suit, secondly he can file a suit in Pakistan on the basis of the foreign judgment treating it as the cause of action. In that case if the conditions prescribed in section 13, C.P.C. Are fulfilled, the judgment is conclusive between the parties and otherwise it is res judicator between them and such Courts in Pakistan are bound by its findings. Such suit however, is to be filed within the period of six years from the date of that judgment as provided under Article 117 of the Limitation Act, or thirdly he can file suit on the original cause of action as it does not come to an end after passing of foreign judgment, but remains intact until and unless that foreign judgment is satisfied. However, if the conditions mentioned in section 13 are not satisfied, then the decree will be open to collateral attack in Pakistan. The provisions of Ordinance, 2001 are applicable to the plaintiff Bank. There is nothing in section 13, C.P.C., which has effect of excluding the provisions of above Ordinance 2001 or to sit on a foreign judgment in appeal. In the present case plaintiff has filed suit on the basis of foreign judgment treating it as cause of action, which he can do under the law. I, therefore, do not find any illegality in the form of the present suit and suit is maintainable in the banking jurisdiction as provided under Ordinance, 2001.
19. As noted above, defendants were served in accordance with provisions of Ordinance 2001 but neither any leave to defend application has been filed by the defendants -nor any one appeared on the date of hearing. The liability of the defendants was directly adjudicated upon. The Original Court directed all the defendants to pay jointly a sum of AED 918336.58 and accrued interest @ 12% per annum from 21-2-1999 till full payment and to pay all the expenses and fees including fee of the Advocate. Appellant Farouq Muhammad filed an Appeal No,600 of 2008 and on appeal the Appellate Court exempted appellant Farouq Muhammad from making any payment in terms of original judgment by cancelling the rule against him and denied the lawsuit against him for lack of capacity and to abide the Bank, Habib Bank Ltd., by fees and AED 300 as Advocate fee. However Appellate Court ordered the other respondents to pay an amount of AED 2303171 jointly and pay the reasonable expenses and NED 300 as Advocate fee.
20. From the perusal of the certified copies of the foreign judgment along with their translation, which are available on record.
It is manifestly clear that the Court while passing the Judgment has taken into consideration the finance availed by defendants. The amount paid by them. The principal outstanding against the defendants and also considered the markup claimed by the plaintiff-Bank. After examination of entire documentary evidence placed before the original Court of United Arab Emirates as also the Appellate Court of United Arab Emirates have passed the judgments against the defendants. The Original Court had also called for the report from the accounting expert and after hearing the parties and satisfying itself the judgment was passed on merits by the Foreign Courts.
21. The Foreign Judgments are presumed to be pronounced by the Court of competent jurisdiction within the contemplation of section 14 of C.P.C. The defendants have failed to rebut the presumption. There is nothing on record to show that foreign judgments upon which the plaintiff has filed the present suit falls within exceptions enumerated in section 13 of C.P.C.
Judgments are conclusive binding on the defendants and this Court while entertaining the claim on the basis of foreign judgment cannot sit as an Appellate Court over findings and conclusion arrived at by the two foreign Courts. The suit on the basis of cause of action upon foreign judgments is governed by Article 117 of the Limitation Act, which provides a period of six years from the date of foreign Judgment. In the instant suit, appellate judgment was pronounced on 28-10-2008 and the present suit was filed in this Court on 13-10-2010, thus the suit was instituted within the time provided under the law.
22. In the case of Abdul Ghani (PLD 1960 (Karachi) 594 (supra) a learned Single Judge of this Court (as he then was) while dealing with the provisions of section 14 of C.P.C. Has observed as under:-- '
" The learned Subordinate Court's view that if a copy of a judgment purported to be of a foreign Court is produced, a presumption arises under section 14 of the C.P.C. That it is a judgment of a foreign Court and it is not necessary to prove its certified copy either by invoking section 86 of the Evidence Act or by any other mode recognized under the Evidence Act is not correct. To raise a presumption under section 14 on the production of a copy of a judgment of a foreign Court that it is a judgment of a competent Court is one thing but that will not obviate the necessity of providing that it is in fact a judgment of a foreign Court. Section 86 can be invoked to raise a presumption, failing which the Juridical proceedings of a foreign Court must be proved by other recognized methods before they are admitted in evidence. I find no force in the view of the Subordinate Court in this respect and therefore hold that his finding on this point is not in accordance with law."
23. In the present case not only the certified copy of foreign judgment was filed but its English translation duly attested by the Consulate General of Pakistan, Dubai has been brought on record. Article 96 of Qanun-eShahadat Order, 1984 provides that the Court may presume that any document purporting to be a certified copy of any judicial record of any country not forming part of Pakistan is genuine and accurate, if the document purports to be certified in any manner which is certified by, any representative of the Federal Government in or for such country to be commonly in use in that country for the certification of copies of judicial record. Certified copies of foreign judgments and its translation in English language duly attested by Consulate General of Pakistan are in accordance with law.
24. In the case of Popat Virji (supra) a learned Single Judge of Bombay High Court while dealing with provision of section 13 C.P.C. Has observed as under:- " It is not open to the Court trying the suit on a foreign judgment to decide whether the decision of the foreign Court on the materials put before it is right or not. The duty of the Court is merely to see that the foreign Court has applied its mind to the facts and the law on the point."
25. In the break up of claim of the plaintiff has shown the total finance availed by defendant No, 1 . As per breakup of claim no payment appears to have been made by the defendants to the plaintiff. Plaintiff Bank has charged the markup allowed as per foreign judgments @ 12% per annum for the period of 21-12-1999 to 31-7-2010 and Advocate fee. Total amount recoverable from the defendants has been shown to AED 4,606,342. It has been stated in the breakup of claim that total amount of interest cannot be more than the amount of finance proved and determined against the defendants.
26. Since no leave to defend application has been filed by the defendants and there is nothing on record to rebut the claim of plaintiff. Have no option but to decree this suit as prayed.