Through this appeal the appellant has challenged the order dated 22.4.2013 whereby the learned Judge Banking Court-I, Lahore, has returned the plaint to the appellant/plaintiff under Order VII Rule 10, CPC.
2. The facts of the case are that the appellant filed a suit against Respondents No, 2 to 9 for recovery of Rs,12 million along with Rs,1.5 million mark up and 12% per annum profit. In response to the summons, the respondents appeared before the learned Judge Banking Court and filed an application for leave to defend the suit. The learned Judge Banking Court through the impugned order dated 22.4.2013, in exercise of powers under Order VII Rule 10, CPC, returned the plaint. Hence, this appeal.
3. The learned counsel for the appellant argued that the appellant was defrauded by the employees of the respondent Habib Bank Limited in their official capacity and, therefore, the Banking Court had jurisdiction to adjudicate upon the matter and the impugned order is contrary to law. It has been further argued that since Respondent No, 2 was an agent of Respondent No, 1 the appellant, had rightly filed a suit before the Banking Court.
4. We have considered the arguments advanced by learned counsel for the appellant.
5. It would be appropriate to refer different provisions of the Financial Institutions (Recovery of Finances) Ordinance, 2001 to resolve the dispute involved in this appeal.
6. Section 2(c) of the Financial Institutions (Recovery of Finances) Ordinance, 2001 reads as under:- -
2. Definitions.--
(a) ...........................
(i) ............
(ii) ..........
(iii) .........
(b) .......................
(i) ...........
(ii) .............
(c) "customer" means a person to whom finance has been extended by a financial institution and includes a person on whose behalf a guarantee or letter of credit has been issued by a financial institution as well as a surety or an indemnifier: The terms "finance" and "obligation" are defined in Section 2(d) and 2(c) of the Financial Institutions (Recovery of Finances) Ordinance, 2001 which are reproduced below:
2. Definitions.--
(a) ............................
(i) .............
(ii) ..............
(iii) ..............
(b) .........................
(i) ..............
(ii) ................
(c) .......................
(d) "finance" includes--
(i) an accommodation or facility provided on the basis of participation in profit and logs, 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 buy-back arrangement by a seller, participation term certificate, musharika, morabaha, musawama, istisnah or modaraba certificate, term finance certificate;
(ii) facility of credit or charge cards;
(iii) 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;
(iv) 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;
(v) 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;
(vi) 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; 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.
(e) "obligation" includes-
(i) any agreement for the repayment or extension of time in repayment of a finance or for its restructuring or renewal or for payment or extension of time in payment of any other amounts relating to a finance or liquidated damages; and
(ii) any and all representations, warranties and covenants made by or on behalf of the customer to a financial institution at any stage, including representations, warranties and covenants with regard to the ownership, mortgage, pledge, hypothecation or assignment of, or other charge on assets or properties or repayment of a finance or payment of any other amounts relating to a finance or performance of an undertaking or fulfillment of a promise; and
(iii) all duties imposed on the customer under this Ordinance; and This brings us to Section 9 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 which reads as under:- "9. Procedure of Banking Courts.--(1) Where a customer or a financial institution commits a default in fulfillment of any obligation with regard to any finance, the financial institution or, as the case may be, the customer, may institute a suit in the Banking Court by presenting a plaint which shall be verified on oath, in the case of a financial institution by the Branch Manager or such other officer of the financial institution as may be duly authorized in this behalf by power-of-attorney or otherwise."
7. Plain reading of the above provisions makes it clear that a borrower or a customer could institute a suit in the Banking Court only if there was a default in fulfillment of any obligation with regard to any finance.
8. In the present case the appellant has leveled allegations of embezzlement and fraud against Respondent No, 2 regarding transfer of an amount form his account in the personal account of Respondent No, 2 This act on part of Respondent No, 2 does not amount to breach of any obligation or default in fulfillment of an obligation and is thus not covered by Section 9 of the Financial Institutions (Recovery of Finance) Ordinance, 2001.
9. For what has been discussed above, this appeal stands dismissed in limine