This petition under Article 199 of the Constitution of Islamic Republic of Pakistan, 1973 has the following prayer: "In the stated circumstances, it is respectfully prayed that criminal proceedings initiated against the petitioner vide complaint No.14/2009 u/ s 20 of Financial Institutions (Recovery of Finances)
Ordinance, 2001 are premature, in violation of law and judicial precedent and liable to be stayed till the final disposal of the execution application pending before this Honourable Court; therefore the said proceedings may kindly be ordered to be stayed till the decision of the execution application as stated above."
2. The relevant facts are that the respondent No.1 filed a suit for recovery bearing No.COS 11 of 2008 before this Court in its jurisdiction under the Financial Institutions (Recovery of Finances)
Ordinance, 2001 (Ordinance). The said suit was decreed vide judgment and decree dated 24.11.2009, however, the question which arose during the hearing of the suit regarding the misappropriation of the pledged stocks was postponed to be determined during the execution proceedings. The petitioner thereafter filed an application under section 47 of the Code of Civil Procedure (CPC) in the execution petition Ex. A. No.18-B/2010 filed by the decree holder bank. This Court vide order dated 10.01.2013 framed the following issues: i. "Whether the pledged stocks has been misappropriated by the decree holder? OPA ii. In case it is proved that the decree holder has failed to safeguard the pledged stocks as an ordinary prudent man, what will be its effect? OPR iii. In case the decree holder fails to return the pledged stock with natural wear and tear, whether the decree holder is entitled to recover Cash Finance Facility? OPR"
3. The decree holder bank subsequently filed a complaint under section 20 of the Ordinance alleging misappropriation of pledged stocks by the judgment debtors and prayed for criminal proceedings to be set in motion against the judgment debtors for alleged breach of trust with regard to the pledged stocks. The petitioner herein filed an application for staying proceedings in complaint case No.14 of 2009 pending before the Judge, Special Court (Offences in Bank) Punjab, Lahore. The said application was decided vide order dated 19.2.2014 which has been called in question through the instant petition.
4. The learned counsel for the petitioner submits that although the criminal as well as civil proceedings relating to the same subject matter can run parallel to each other yet if the criminal proceedings, by its very nature, are such that its determination must be postponed till the civil liability is determined, stay of the proceedings must be granted as of right. He has relied upon in this regard on the precedents reported as Akhlaq Hussain Kayani v. Zafar Iqbal Kiyani and others (2010 SCM R 1835), Abdul Ahad v. Amjad Ali and others (PLD 2006 Supreme Court 771) and Muhammad Akbar v. The State and Maulvi Muhammad Yasin Khan (PLD 1968 Supreme Court 281).
5. The facts which have been narrated above are not disputed between the parties. The application of the petitioner under section 47 CPC is also pending determination before this Court and has been fixed for the adducing of evidence pro and contra by the decree holder bank and the judgment debtors. The issues have been reproduced above and it is evident from a reading of issue No.1 that the issue squarely involves the pledged stocks and the determination relates to the question of misappropriation of the pledged stocks. In a nub, the determination of the said issue will have an important bearing and will necessarily impact the outcome of the criminal complaint whose stay has been sought through these proceedings. In other words, the two proceedings are intertwined and one is dependent upon the other. The rule in such matters has been laid down by the Supreme Court in Akhlaq Hussain Kayani case, supra, and the following observations are relevant, which are: "7. Although civil liability is independent of the criminal liability and no invariable rule exists to the effect that pending decision of a civil suit criminal proceedings must be stayed as it is purely a matter of discretion yet, while exercising the discretion, the guiding principle should be to see as to whether the accused is like to be prejudiced if the criminal proceedings are not stayed but when it is clear that the criminal liability is dependent on the outcome of civil litigation, then criminal proceedings must be stayed, particularly when dispute is with regard to title of the property. The case of Muhammad Akbar v. The State and others (PLD 1968 Supreme Court 281) is an apt example to the proposition in hand wherein, in somewhat identical situation, proceedings in the criminal case were stayed..."
6. It is evident that the test laid down by the Supreme Court of Pakistan is that the criminal proceedings ought to be stayed if the criminal liability is dependent on the outcome of civil litigation. Applying that test to the facts of present case, it is evident that the question substantially and intrinsically in both the criminal complaint as well as the proceedings in execution before this Court is the same and this Court in the execution proceedings is seized with the matter of determining the question of fixing the liability for the misappropriation of the pledged stocks. On the other hand, in the criminal complaint, filed by the decree holder bank, it has been alleged that the judgment debtors have fallen in criminal breach of trust and thus are liable to be proceeded against for the commission of that offence. In a likely scenario if the criminal complaint were to be decided ahead of the proceedings in execution before this Court, the judgment debtors would be seriously prejudiced in case subsequently it is found by this Court that judgment debtors cannot be fixed with the liability for misappropriation of the pledged stocks. In other words, the criminal complaint cannot proceed until the determination of the civil liability is handed down by this Court.
7. In view of the above, this petition is accepted and the proceedings in complaint case No.14 of 2009 pending before the Judge, Special Court (Offences in Bank), Punjab, Lahore are stayed till the decision by this Court in the execution petition of the question regarding the misappropriation of pledged stocks. Either party will be at liberty to revive these proceedings upon the decision by this Court of the said question.
8. Petition accepted.