' FAISAL ARAB, J.---The respondent No,1 is a private limited company. In January 1990 it obtained a financial facility from the appellant and in 1997 filed a suit for settlement of accounts and redemption of mortgaged property and also claimed damages.
2. The case of the respondent No,1 Company in the suit was that under letter dated 4-1-1990, the appellant bank sanctioned a sum of Rs,1.500 million as cash finance facility on which mark-up was chargeable at the rate of 45 paisa per day per thousand only up to 31-12-1990, yet the appellant bank made excess recoveries from the respondent No,1 company to the extent of Rs,2,517,312 which are liable to be refunded back along with damages to the tune of Rs,3,252,000.
3. The appellant bank filed written statement wherein the authority of the executant of the plaint on behalf of the respondent No,1 company was disputed. On merits of the case, it was stated in the written statement that cash finance facility to the tune of Rs,1.500 million was extended by the appellant bank to the respondent No,1 company which was to be adjusted by 30-12-1990. It was also claimed that a sum of Rs,275,908 is still due and payable towards markup which the respondent No,1 company is liable to pay to the appellant bank.
4. Leave was granted and evidence was led by the parties. The Banking Court vide its judgment dated 5-9-2008 decreed the suit holding that an amount of Rs,1,287,811.04 has been paid by the respondent No,1 company in excess of its financial obligation which is liable to be refunded by the appellant bank.
5. Aggrieved by the judgment of the banking Court, the appellant bank has filed the present appeal.
6. Vide order dated 20-5-2010, Mr. Salahuddin Ahmed and Mr. Ijaz Ahmed were appointed as amicus curiae to address the Court on the legal points. Mr. Ijaz Ahmed excused himself from addressing the Court on the ground that he represents the appellant bank in other cases.
7. Mr. Salahuddin Ahmed, after referring to the contents of paragraphs 3, 6 and 14 of the plaint and paragraphs 3 and 7 of the written statement, contended that the dispute in the suit pertains to the financial facility that was availed by the respondent No,1 company between 10-1-1990 to 30-12-1990 and as the plea of renewal was not taken in the written statement, no such plea at the subsequent stage could be taken by the appellant bank. In support of this contention he has relied upon PLD 2110 SC 965, PLD 1993 SC 88, 1968 SCM R 804, 1996 SCM R 336, 1992 M LD 2000 and 1984 CLC 1853. #TBS 16.4% #TBE #TBS Rate of Markup #TBE 8.Mr. Sadruddin Hudda, learned counsel for the appellant bank, on the other hand, argued that the respondent No,1 company has executed not only agreement of finance on 4-1-1990 but has also executed three additional finance agreements on 31-12-1990, 22-4-1992 and 22-11-1993 and all such renewal, after the initial first agreement dated 4-1-1990, were made at the request of the respondent No,1 company. In support of this contention, he has referred to the respondent No, l's letters dated 2-5-1992 and 26-9-1992 wherein the financial facility was sought to be extended uptil 31-3-1993 and, therefore, it was contended by the learned counsel for the appellant that after taking into consideration the markup for the period of finance that was availed after the initial first year a sum of Rs,275,908 is due and payable by the respondent No,1 company to the appellant bank and the Banking Court while passing the impugned judgment was not justified in decreeing the suit in favour of the respondent No,1 company to the extent of Rs,1,287,811.04.
9. Mr. Mushtaq A. Memon, learned counsel for the respondent No,2, contended that the plea of renewal of the finance agreement was not taken in the written statement and, therefore, no evidence is to be looked into which is not based on the pleading of the parties. In support of his contention, he relied upon 2004 CLD 162, 2009 CLD 419 and 460, PLD 2011 SC 151, AIR 1942 P.C. 64, 2005 CLC 444, 2005 SCM R 152, 2007 CLD 1384 and 2000 CLC 847.
10. Before examining the respective contentions, it will be appropriate that the agreements of finance, that were produced in evidence and not disputed by the respondent No,1 company be examined. The first agreement is dated 4-1-1990 wherein a sum of Rs,1.500 million was admittedly sanctioned and extended to the respondent No,1 company by the appellant bank. Markup was chargeable to the extent of Rs, 300,000. After taking into consideration, the prompt payment bonus as mentioned in the agreement markup to the tune of Rs,246,000 was to be paid on the finance availed by the respondent No,
1. Under the second agreement dated 31-12-1990 a sum of Rs,300,000 was to be charged as markup. Under the third agreement dated 22-4-1992 again a sum of Rs,300,000 was to be charged as markup. Under the fourth agreement dated 22-11-1993 no amount of markup is mentioned in the agreement. Hence, under all the four agreements, the total sum of Rs,846,000 was to be charged towards markup and nothing beyond such amount.
11. The appellant bank filed a break up statement on 5-6-2006 before the Banking Court, which is quoted as follows:-- Date of Sanction 4-1-1990 Rate of Markup 16.4% Buyback Price Rs. 1,800,000.00 Sanction Limit Rs.1,500,000.00 Disbursement Rs.2,789,679.00 Markup Charged Rs.1,710,986.00 Other Charges (Central Excise Duty)Rs.74,053.00 Sub Total Rs.4,574,718.00 Repayment Rs.4,298,810.00 Total outstanding amount Rs. 275,908.00
12. Under the above break up statement, the amount disbursed is Rs,2,789,679 and the amount repaid by the respondent No,1 company to the appellant bank is Rs,4,298,810 whereas in the impugned judgment the amount disbursed is Rs,2,787,089 and the amount repaid by the respondent No,1 company is Rs,4,299,410. So there is not much difference between the two sets of amount disbursed and the amount repaid.
13. Taking up the legal objection as to the authority of the person who filed the suit on behalf of the respondent No,1 company first, the same did not found favour with the Banking Court and in the memorandum of appeal no ground has been taken with regard to the authority of the person who filed the suit on behalf of the respondent No,1 company. Therefore, the argument advanced by the appellant's counsel challenging the authority of the person who signed the plaint cannot be taken into consideration. As regards the argument of Mr. Memon that the plea of renewal of agreement was not taken in the written statement and, therefore, cannot be taken into consideration in spite of the fact that evidence to that effect has been recorded, no doubt it is a principle of law that no evidence is to be looked into if it is not based on the pleadings of the parties. However, present proceedings arise from a suit for settlement of accounts between the two parties. While settling the accounts, whatever amount is due and payable by a party to the other is to be calculated on the basis of the evidence that was brought on record and not objected to by the contesting party when such evidence was being recorded. While taking accounts if a document has not been denied or disputed when it is produced in evidence which relates to the .Accounts between the parties then the Court while determining the amount due to a party shall take into consideration all such documents and admissions, if any, of the parties though it may not be part of the pleadings of the parties. In the present case, the appellant bank produced four finance agreements that were executed by the respondent No,1 company and in fact during the cross-examination it was suggested by the counsel for the respondent No,1 company himself to the witness of the appellant's bank that at the time of renewal of the loan in 1992-93 the appellant bank obtained resolution from the board of directors of the respondent No,1 company in favour of Mr. Bashir Ahmed Memon and got the loan facility renewed. This is a clear admission that the facility was renewed. On the record there are three agreements of markup that were executed after the first agreement dated 4-1-1990. None of them have been denied or disputed in any manner. Therefore, while taking accounts between the parties, the Court cannot not ignore these undisputed documents and the above mentioned admission in order to come to the correct calculation with regard to the amount which one party owes to the other in a suit for settlement of accounts. Now taking the figures from the break up statement, filed by the appellant bank, and slight modifications made in the impugned judgment, it is evident that the respondent No,1 company has repaid a sum of Rs,4,299,410 against the total withdrawal of Rs,2,787,089. When the repayments are deducted from the amount utilized by the respondent No,1 company it leaves a balance of Rs .1 ,512,321. Under all the agreements, produced in evidence, the cumulative markup chargeable thereunder is Rs,846,000. When the markup chargeable under all the agreements i,e, Rs,846,000 is deducted the balance amount of Rs,1,512,321 and the incidence of Excise duty of Rs,74,053 is also deducted, an excess amount of Rs,592,268 becomes refundable to the respondent No,1 company.
This amply establishes that excessive recoveries were made by the appellant from the respondent No,
1. Hence, the decretal amount as stated in the impugned judgment is reduced from Rs,1,287,811.04 to Rs,592,268.
14. With the above modification, the appeal is partly allowed.