' IBAD-UR-REHMAN LODHI, J.---Both the petitioners, in their respective capacities, availed different financial facilities from the Bank of Punjab and in case of non-observance of the repayment according to the settled schedule, the parties had to enter into litigation. During such litigation, they settled their disputes by entering into Settlement Agreement dated 30-5-2012, and by implementing the settled terms in that agreement, not only both the sides withdrew their respective proceedings from the concerned courts, but also the Bank issued clearance certificates in favour of both the petitioners. The amount of mark-up, however, was not paid by the petitioners rather it was written off as indicated in the Statement showing written off loans or any other financial relief of five hundred thousand rupees or above provided during the year ended on December 31, 2012.
2. When such information of written off mark-up was conveyed under the law to the State Bank of Pakistan, the names of the petitioners were included in the list maintained by the Credit Information Bureau (hereinafter to be referred as "CIB").
3. The petitioners are aggrieved of inclusion of their names in such list of CIB and through the present Constitutional Petition, prayed for issuance of writ declaring such placement as illegal, unlawful and without any justification.
4. The admitted position is that the petitioners benefited themselves by availing financial facilities from the Bank of Punjab, a Scheduled Bank, and notwithstanding the settlement of disputes in between the petitioners and the Bank of Punjab, it remained a fact that the amount of mark-up was never paid by the petitioners and on receipt of such waiver by the Bank of Punjab in favour of the petitioners, the State Bank of Pakistan, under the law, has included the names of the petitioners in the list maintained by CIB in the State Bank of Pakistan showing such defaulters.
5. The State Bank of Pakistan was established in view of section 3 of ,the State Bank of Pakistan Act, 1956 (XXXII of 1956) in order to regulate the monetary and credit system of Pakistan and to foster its growth in the best national interests with a view to securing monetary stability and fuller utilization of the country's productive resources.
6. In order to consolidate and amend the laws relating to banking companies, the Banking Companies Ordinance, (LVII of 1962) was promulgated. Section 41 whereof provides the powers to the State Bank, including a power to give direction to prevent the affairs-of any banking company being conducted in a manner detrimental to the interests of the depositors or in a manner prejudicial to the interest of the banking company, or to secure the proper management of any banking company generally. The State Bank may, from time to time, issue directions as it deems fit, and the banking companies or any particular. Banking company, as the case may be, shall be bound to comply with such directions. The State Bank was made competent by means of section 41(2) of the Ordinance to issue, from time to time, directions, guidelines and instructions with respect to activities and operations of banks and the Financial Institutions for carrying out purposes of the Ordinance and matters ancillary thereto. Section 25-A of the Ordinance gives powers to the State Bank to collect and furnish the credit information and every banking company was made bound to furnish to the State Bank credit information in such manner as the State Bank may specify, and the State Bank may, .Either of its own motion or at the request of any banking company, make such information available to any banking company on payment of such fee, as the State Bank may fix from time to time. Provided that, while making such information available to the banking company, the State Bank shall not disclose the names of the banking companies which supplied such information to the State Bank. Provided further that, a banking company which proposes to enter into any financial arrangement which is in excess of the limit laid down in this behalf by the State Bank from time to time shall, before entering into such financial arrangement, obtain credit information of the borrower from the State Bank.
7. The State Bank of Pakistan by means of Circular Letter No, 29 of 2013, dated 21-11-2013, directed all Banks/DFIs to convey the information to the Credit Information Bureau with regard to write off loans and it was made clear that write off loans includes any form of relief allowed to the customer in terms of dues outstanding towards the bank/DFI, including principal, markup/profit and other charges. All concerned were directed to up-date the information to CIB by meticulous compliance of the directions contained in said Circular.
8. In case of Messrs Abdul Aziz Nawab Khan and Company v. Federation of Pakistan, Ministry of Finance and others (2006 CLD 55), it was held that the State Bank of Pakistan has developed a mechanism for collecting information through banks/financial institutions pertaining to their customers and their financial status available with them. Purpose seems to be that from one source i.e, CIB in State Bank of Pakistan any bank or any financial institution may in its turn collect information about the financial status of a customer with other banks enabling them to decide business transaction with the proposed borrower. The mechanism has been adopted to save the financial institutions falling prey to the defaulters and such exercise is only aimed at to conduct transparent business and to provide the financial institutions, who were holding depositor's funds 'to look before they leap' with regard to financial commitment.
9. Credit Information Bureau is a project of State Bank of Pakistan for collecting data, primary purpose of which is to equip all banks and financial institutions notwithstanding such placement of name of any business concern in the list maintained by CIB. The lending institution, however, is at liberty to extend financial assistance to a borrower despite placement of name of a customer on Credit Information Bureau list.
10. The learned counsel for the petitioners has placed reliance on Messrs Yousaf Sugar Mills v. Trust Leasing Corporation and others (2006 CLD 1191) and contended that the placement of a person on the list of CIB indicating the defaulters placed a restriction on a business to enter freely into a contract with bank etc., therefore, before such placement every individual is entitled to a notice.
' I am afraid the findings arrived at by this Court in Yousaf Sugar Mills's case are not of any help for the petitioners, for, it was a case of Leasing Company, which extended facility of some financial assistance to the petitioner in the reported case and it was held that in view of section 25 of the Banking Companies Ordinance, 1962, the State Bank of Pakistan can collect credit information from the Banking Company only, whereas, Leasing Company does not fall within the definition of Banking Company. It was further elaborated that Banking Company is under the control of State Bank of Pakistan while Leasing Company, as against a Banking Company is under the control of Securities and Exchange Commission of Pakistan.
' In the present case, respondent No,2 is a bank and not a Leasing Company, thus, the petitioners cannot get any benefit of any findings arrived in a case relating to Leasing Company.
11. In the present case, the Bank of Punjab has not only entered into an agreement with the defaulters and after receipt of the principal amount only of the loan facility, issued clearance certificates, but when this petition was filed, the learned counsel representing the Bank of Punjab appeared with no contest to the prayer made by the petitioners. This seems to be an attempt on the part of a scheduled bank to be out of the administrative control of State Bank of Pakistan and to regulate its own financial discipline ignoring what the Central Bank wants from the banks/financial institutions.
12. The Credit Information Bureau in State Bank of Pakistan on a number of times since 2007 to 2012, repeatedly asked the petitioners that the CIB proposed to reflect the information extended by the Bank of Punjab on the CIB database and after providing the detail of other due amounts of the loans/mark-up, required the petitioners that if the statement is not in agreement with their record, they should settle the disputes with the banks/financial institutions and in such case, their names will no longer be included in the CIB database, and if the statement provided by the State Bank of Pakistan to the petitioners was not in agreement with their record, the petitioners were required to provide CIB the details and take up the matter with the concerned institutions. In case a satisfactory settlement of other due amount would not take place, within one month from the issuance of notices, it was made clear that the information will be included in the CIB database.'
13. It is unfortunate that the tendency of writing off the loans or markup is being increased in our financial circles. The business concerns get loan facilities amounting to millions and billions of rupees and subsequently as of right claim writing off the same, and at the same time, do not want that even their such status of having written off their loan facility be made public. Our banks and financial institutions, in certain cases, seem to be a tool in the hands of such defaulters.
14. None of the said notices was responded to by the petitioners and, therefore, rightly the State Bank of Pakistan included the names of the petitioners in the CIB database.
15. The petitioners, on one hand, are not going to make payment of mark-up, which admittedly have been written off by the Bank of Punjab and at the same time, wants that their names should not be included in the list indicating such defaulters, to be maintained by the CIB in State Bank of Pakistan. The petitioners have no right to ask for such illegal withholding of information from the financial institutions just in order to put at guard the banks/financial institutions for any future transaction to be carried out with the petitioners. In our banking system, we experience on every second day that the bona fide account holders are not being extended any due benefit of such banking system, rather the privileged classes are being extended undue benefits and, thus, resultantly our economy has become termitarium and the main causes for such disaster are those undue benefits, which are being extended to so-called aristocracy C.21)i), which class is behind our economy. A common man of lower middle class, who obtains a loan from House Building Finance Corporation for construction of his house or receives a petty amount from any bank, is not only prosecuted but also persecuted and a privileged class is allowed to enjoy the facility of taking loan facilities and then subsequently writing them off and even then they ask the courts to put a restraint over the financial institutions of this country to even disclose such anti economy activities to public at large. This is high time to eradicate such menace. The State Bank of Pakistan must deal with such elements and also the banks/financial institutions, who are proved to be hands in gloves with such defaulters, with strong hands to put all such stakeholders in a discipline.
16. The petitioners have filed this Constitutional Petition by stating that they have no other adequate and efficacious remedy, but ignored the remedy of representation provided under section 41(3) of the Banking Companies Ordinance, 1962, where under, the State Bank may, on representation made to it or on its own motion, modify or cancel any direction issued under subsection (1) of section 41 of the Ordinance. The petitioners were having a remedy to represent against the inclusion of their names in the list maintained by CIB and without availing such remedy this petition directly filed in constitutional jurisdiction of this Court is not competent.
17. For what has been discussed above, this petition having no force is dismissed.