' MUHAMMAD KHALID MEHMOOD KHAN, J.---The respondent No,1 filed a suit for recovery of Rs,3,884.606.15 against the appellant and respondents Nos.2 to 4, asserting that respondent No,3 is a key applicant, the appellant being the co-borrower and respondent No,4 being guarantor requested for allowing a financial facility (Agri Finance) in the name of respondent No,2, on their request the respondent No,1 sanctioned a facility of Rs,4.3 Million to respondent No,2. The respondents for securing the said finance facility executed charge documents detailed in para 4 of the plaint, the appellant and respondents Nos.2 to 4 also mortgaged their immovable property for securing the finance facility and executed an agreement of personal guarantee. The respondents availed the facility and a sum of Rs,3,884,606.15 is outstanding against the appellant and respondents Nos.2 to 4. The appellant and respondents Nos.2 to 4 have failed to repay the finance as per agreement. The appellant and respondents Nos.2 to 4 filed two separate petitions for leave to defend. The respondents Nos.2 to 4 raised number of objections including the maintainability of suit. They averred that the enhanced facility of Rs,3.1 million was availed by the appellant through a cheque No,4894073 DD & P/O issued in favour of Dawood Yamaha Company, hence applicant alone is responsible to pay. The appellant also mortgaged her property for securing the facility in addition to the facility of Rs,1.2 Million. It was further averred that they availed the facility of Rs,1.2 million and, paid Rs,2.00 million against the facility of Rs,1.2 Million, hence they have paid the facility of Rs,1.2 Million and as such their mortgaged property and guarantee stand redeemed.
2. The appellant in her PLA averred that she only mortgaged her property for securing the loan of Rs,1.2 million allowed to respondent No,2, the facility of Rs,3.1 Million was allowed to respondent No,2 without her consent and knowledge, she is not liable to pay the enhanced facility of Rs,3.1 Million nor she is the mortgagor and guarantor of the enhanced facility of Rs,3.1 Million. In addition to the above said objection the appellant denied the execution of charge documents including the finance agreement.
3. Learned Banking Court dismissed both the PLAs and decreed the suit declaring that respondents Nos.2 to 4 are liable to pay Rs,1.2 million, the initial finance. The said finance has been paid and adjusted hence the respondents Nos.2 to 4 stand absolved. The appellant is liable to pay the suit mount being the enhanced finance of Rs,3. 1 Million as the appellant has executed the finance agreement as co-borrower in the year 2006. The appellant has assailed the judgment and decree dated 2-6-2011.
4. Learned counsel for appellant submits that appellant is not the beneficiary of enhanced finance of Rs,3.1 Million nor she ever availed the facility. The appellant no doubt mortgaged her property, but her property was charged against a finance of Rs,1.2 million which admittedly has already been paid and adjusted. It is the respondents Nos.2 and 3 who availed the facility as is evident from the statement of account. The facility so availed is the sole liability of respondents Nos.24. Learned counsel further Court submits that the learned trial Court while deciding the PLA, without recording evidence was not having Jurisdiction to hold that respondents Nos.2 to 4 are not responsible to pay the enhanced finance. The learned trial Court if was of the opinion that liability of mortgagor, guarantor and principal borrower can be bifurcated then the learned trial Court was bound to allow the application for permission to defend the suit as this fact could be decided only after recording the evidence.
5. Learned counsel for respondents/decree holder submits that the appellant is a co-borrower and is the beneficiary of the finance and as such she is responsible to make the payment of outstanding liability. Learned counsel submits that finance agreement is also executed by the appellant along with respondent No,3 being co-borrower. He submits that the pay order of Rs,30,50,000 was issued in the name of Dawood Yamaha on the instructions of co-borrower, hence, it is established fact on record that appellant is the beneficiary of the Finance in dispute.
6. We have heard the learned counsel for the parties and examined the record.
7. Record shows that respondent bank asserted in para 1 of the plaint that respondent No,3 being key applicant, appellant being co-borrower and respondent No,4 being guarantor requested for the grant of (Agri Finance) facility in the name of respondent No,2 and on the request a finance facility of Rs,4.3 Million was allowed to them (Annexure-C), no date of sanction of finance was mentioned, however, as per (Annexure-C) the facility was sanctioned on 3-6-2005. The respondent No,2 Moon Traders admittedly is a proprietorship concern with respondent No,3 as its proprietor.
The record shows that on 3-6-2005 facility of Rs,12 million was allowed to respondent No,2. The respondents Nos.3 and 4 and appellant guaranteed the repayment of said finance, they also mortgaged their immovable properties for securing the repayment of finance of Rs,1.2 Million. The facility of Rs,1.2 Million was enhanced through an un-dated letter available at page 65 of the record. Letter of hypothecation available at page 101 of the record shows that enhanced finance, of Rs,4.3 Million was allowed on 31-5-2006. The document available at page 65 shows that the name of business is Moon Traders, key applicant is Muhammad Salim co-borrower is Shamim Akhtar, hence, it is an established fact on record that principal borrower is respondent No,3 and the appellant is a co-borrower, hence, both are jointly and severally liable to pay the finance. The respondents Nos.3, 4 and appellant have mortgaged their immovable property for securing the facility of Rs,4.3 million. The offer letter was accepted by respondent No,3 on behalf of Moon Traders, so the principal borrower will remain respondents Nos.2 and 3. No doubt the appellant is a mortgagor but the account was maintained and operated by the Moon Traders through respondent No,3, so amounts withdrawn from the account of Moon Traders could be withdrawn only through cheque signed by respondent No,3, hence, the argument of learned counsel for the respondents that on the 'instruction of appellant a sum of Rs,30,50,000 was debited to the account is against the record. The cheque dated 23-8-2006 bearing No,4894073 is issued by the account holder i.e, respondent No,3 and the said amount was debited on the basis of cheque issued by respondent No,3.
8. Under the agreement of personal guarantee the liabilities of guarantor are joint and several. In case learned Banking Court was of the view that respondent other than appellant have adjusted the liability of Rs,1.2 and they are only responsible for the payment of Rs,1.2 Million the learned trial Court was bound to grant leave to defend the suit to respondents as separate liability can only be ascertained after recording the evidence.
9. The learned Banking Court while dismissing the application for leave to defend the suit, decreed the suit without recording the evidence and relied on the document which is undated and only show that appellant as co-borrower. No cheque or statement of account or even account is in the name of appellant, in the absence of above said facts, the learned trial Court has erred in law while deciding the suit.
10. In view of above said circumstances, we set aside the impugned judgment and decree dated 2- 6-2011 and accept both the applications for leave to defend unconditionally and remand the case of the learned Banking Court, who will frame the issues and after recording the evidence will decide the suit according to law.