' M. SOHAIL IQBAL BHATTI, J. --- Through this Constitutional petition, the petitioners have sought the indulgence of this Court for setting aside the condition imposed under Section 10(9) of the Financial Institutions (Recovery of Finances) Ordinance, 2001 by the learned Single Judge/Banking Court vide order dated 13.9.2012 while granting leave to defend the suit to the petitioner-company.
2. The brief facts of the case are that the respondent-bank filed a suit under Section 9 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 for recovery of Rs, 6,92,11,277.77 from the petitioners. The petitioners filed an application for leave to appear and defend the suit. The learned Single Judge/Banking Court, through impugned order dated 13.9.2012, granted leave to defend the suit to the petitioners subject to deposit of Rs, 20.00 million in cash with the Deputy Registrar (Judicial) of this Court within one month. Aggrieved by the impugned order dated 13.9.2012 to the extent of imposition of condition of deposit of Rs, 20.00 million the petitioners have invoked the extraordinary constitutional jurisdiction of this Court.
3. The learned counsel for the petitioners argued that three valuable properties were mortgaged with the respondent-bank and the value of these properties was much more than the claim made by the respondent-bank. It has been further argued that the impugned order regarding imposition of condition lacks the element of reasoning and, thus, the discretion has been exercised in a colourful manner. The learned counsel further argued that the writ petition was maintainable against an order passed by the learned Banking Court under Section 9 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 in exceptional circumstances. It has also been argued that judicial discretion does not mean a wild self-wilfulness. In support of his contentions learned counsel for the petitioners has relied upon Messrs S.M. Ayub & Co. v. National Bank of Pakistan and others (1983 CLC 2828), Liaqat Ali Khan and others v. Falak Sher and others (PLD 2014 SC 506), Messrs Habib Bank Limited through Authorized Officers/Attorneys v. Messrs Victor Electronics Appliances Industries (Pvt.) Ltd. And another (2011 CLD 1571) and Abdul Karim Jaffarani v. United Bank Ltd. And 2 others (1984 SCMR 568).
4. On the other hand, learned counsel for the respondent-bank raised serious objections to the maintainability of this writ petition. It has been argued that the condition has been imposed by the learned Single Judge/Banking Court in exercise of its power under Section 10(9) of the Financial Institutions (Recovery of Finances) Ordinance, 2001 which could not be interfered by this Court in its extraordinary jurisdiction.
5. We have considered the arguments advanced by learned counsel for the parties.
6. It would be useful to refer to the history of the legislation relating to recovery of Banking Laws.
Initially, the banking companies, like other litigants, were using the forum of Civil Court for settlement of their disputes with the customers. No special privilege was attached to the banking companies/financial institutions and a lengthy procedure was required to redress their grievances.
For the speedy disposal of the disputes of the banking companies with their customers Banking Companies (Recovery of Loans) Ordinance, 1978 was promulgated which was further enacted with certain modifications in 1979. Special Banking Court was established and special summary procedure was adopted for disposal of cases involving the banking companies, but no elaborate procedure was provided in the Ordinance and the procedure under Order 37, CPC was borrowed by the Banking Courts to adjudicate upon the disputes relating to the banking companies and the customers. Section 7 of the Banking Companies (Recovery of Loans) Ordinance, 1979 is reproduced as under:--- "7. Procedure of Special Court.---(1) Suits before the Special Court shall come up for regular hearing as expeditiously as possible and, except in extraordinary circumstances and on grounds to be recorded a Special Court shall not allow adjournment.
(2) In the exercise of its civil jurisdiction, the Special Court shall in all suits before it, including suits based on mortgages of all kinds on statement of accounts for recovery of money paid to, or to the order of, the defendant, follow the summary procedure provided for in Order XXXVI in the First Schedule to the Code of Civil Procedure, 1908 (Act V of 1908)."
' Thereafter on 31.12,1984 Banking Tribunal Ordinance, 1984 was promulgated which provided for a mechanism to recover the finances which were not based on interest. These two laws i.e, Banking Companies (Recovery of Loans) Ordinance, 1979 and Banking Tribunals Ordinance, 1984 were consolidated in the form of Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997. The purpose of enacting the Act, 1997 was to provide speedy measures for recovery of outstanding loans and finances of the banking companies. The Banking Companies (Recovery of Loans, Advances, Credits & Finances) Act, 1997 did not provide any mechanism regarding filing of an application for leave to defend and thereafter the considerations upon which the leave should be granted by the Banking Court. Section 10 of the Banking Companies (Recovery of Loans, Advances, Credits & Finances) Act, 1997 is reproduced as under:--- "10. Leave to defend.---Subject to Section 11, the Banking Court shall, upon an application made by a defendant within the twenty-one days give leave to defend the suit, if a serious and bona fide dispute is raised thereby:"
' Lastly, Financial Institutions (Recovery of Finances) Ordinance, 2001 was enacted on 30.8.2001 after making certain modifications in the Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997; but the object of the Ordinance, 2001 remains the same i.e, to provide speedy measures for recovery of outstanding loans and finances of the banking companies. To our mind the Financial Institutions (Recovery of Finances) Ordinance, 2001 is a remedial statute.
7. According to Crawford in statutory construction the remedial acts/statutes are those which are enacted in order to improve and facilitate the remedies already existing for the redress of wrong or injury as well as to correct the defects, mistakes and omissions. A remedial statute is always enacted to abridge such difficulties which arise by change of time and circumstances.
8. As has been discussed above, Banking Laws did not provide mechanism for deciding applications for leave to defend and the principles were borrowed from Order 37, CPC, it was for the first time that an elaborate procedure has been provided in Section 10 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 for granting leave to defend the suit. The mandatory principles to be met with, while drafting an application for leave to defend the suit, the penal consequences which entail if the application for leave to defend has not been drafted in accordance with the parameters laid down; and also deals with the considerations upon which the leave to defend shall be granted by the Banking Court. Sub-section (8) of Section 10 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 deals with the cases where the leave to defend will be granted by the Banking Court, which is reproduced as under:- "10. Leave to defend.
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8) Subject to Section 11, the Banking Court shall grant the defendant leave to defend the suit if on consideration of the contents of the plaint, the application for leave to defend and the reply thereto it is of the view that substantial questions of law or fact have been raised in respect of which evidence needs to be recorded.
(9)..
(10)..
(11)
(12).
9. It is for the first time that the terms "substantial question of law or fact", (emphasis is provided) has been used in the Financial Institutions (Recovery of Finances) Ordinance, 2001. To our mind the expression "substantial question of law or fact" as employed in Section 10(8) of the Financial Institutions (Recovery of Finances) Ordinance, 2001 does not mean the denial of availing of finance facility or non-execution of the documents. The concept of grant of leave to defend the suit requires that the defendant should come up with a positive defence of a particular fact which must be supported by certain documentary evidence. The term "substantial" means of real worth and importance as opposed to imaginary or illusory. The defendant has to raise a serious question which needs to be important, grave and entails consequences giving cause of concern and must be worthy of consideration.
10. Sub-section (9) of Section 10 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 deals with the imposition of condition by the Banking Court while granting leave to defend the suit which is reproduced as under:- "(9) In granting leave under sub-section (8), the Banking Court may impose such conditions as it may deem appropriate in the circumstances of the case, including conditions as to deposit of cash or furnishing of security."
11. It had always been a banking practice that the finance is always provided against the substantial security in the form of mortgage. Had it been the intention of the legislature that in case of mortgage of valuable properties an unconditional leave to defend the suit shall be granted, the legislature would have incorporated the same in Sub-section (9) of Section 10 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 and would have not left it to the discretion of the Court to impose such condition as it may deem appropriate in the circumstances of the case including condition as to deposit of cash or furnishing of security. The "literal" and "purposive" intent of legislature can be gathered from bare reading of sub-section (8) and sub-section (9) of Section 10 of the Financial Institutions (Recovery of Finances) Ordinance, 2001. This Court in a judgment reported as M.I. Sanitary Store through Proprietor and another v. Federation of Pakistan through Secretary Commerce and 2 others (PLD 2014 Lahore 583), while discussing the literal and purposive intent of legislature, has held as under:--- "The aim of interpretation in law is to realize the purpose of the law....Every statute has a purpose, without which it is meaningless. This purpose, or ratio legis, is made up of the objectives, the goals, the interests, the values, the policy and the function that the statute is designed to actualize. It comprises both subjective and objective elements. The judge must give the statute's language the meaning that best realizes its purpose."
12. In the present case, in paragraph 6 of the impugned order, the learned Single Judge/Banking Court has observed as under:- "Relationship of Banker and customers is admitted between the parties. The execution of document is not denied nor the fact of creation of mortgage charge in favour of plaintiff is denied. The defendants have raised objection that they availed the facility but adjusted the same, but surprisingly they have not disclosed how much amount they availed and how they repaid the same."
' The learned Single Judge/Banking Court went on to observe as under:--- "The statement of account of FAFB/FAPC is also avaible on record which show that different amounts on different times the defendants withdrew out of sanctioned limit of Rs, 15 Million."
' From the perusal of the impugned order it is evident that there were certain discrepancies pointed out by the petitioners in FAFB/FAPC statement of account the sanctioned limit of which was Rs, 15.00 million whereas the suit for recovery of Rs, 69.211 million had been filed by the respondent bank.
13. At this stage it would not be out of place to mention that sub-section (9) of Section 10 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 has to be read with sub-section (8) of Section 10 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 The imposition of condition is dependent upon the grant of leave to defend the suit.
' The order impugned before us is an order which grants conditional leave to the petitioners. Sub- section (6) of Section 22 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 reads as under:- "No appeal, review or revision shall lie against an order accepting or rejecting an application for leave to defend, or any interlocutory order of the Banking Court which does not dispose of the entire case before the Banking Court other than an order passed under sub-section (11) of Section 15 or sub-section (7) of Section 19."
' A bare reading of sub-section (6) of Section 22 of the Financial Institutions (Recovery of Finances)
Ordinance, 2001 shows that no appeal, review or revision lies against an order which accepts or rejects an application for leave to defend, therefore, the Ordinance 2001 has explicitly barred the remedy of appeal, review or revision against an order. The question, thus, arises is as to whether in such a situation a constitutional petition is maintainable. The Honourable Supreme Court of Pakistan in a judgment reported as Syed Saghir Ahmad v. Province of Sindh through Chief Secretary, S&GAD, Karachi and another (1996 SCMR 1165) has held that where a statute excludes a right of appeal from the interim order, the same could not be bypassed by brining it under attack in Constitutional jurisdiction; meaning thereby the Court should not act in a manner by which the object of statute is defeated and the same is rendered negatory. In a judgment reported as Shaikh Gulzar Ali & Co. Ltd. And others v. Special Judge, Special Court of Banking and another (1991 SCMR 590) the Honourable Supreme Court of Pakistan has held as under:- "Art. 199---Banking Companies (Recovery of Loans" Ordinance (XIX of 1979), S. 6--- Constitutional jurisdiction, exercise of---Mere erroneous exercise of jurisdiction does not render the order passed by a Civil Court of competent jurisdiction to be illegal and without lawful authority so as to the amenable to be questioned in the Constitutional jurisdiction of the High Court under Article 199 of the Constitution."
14. This Court, in a judgment reported as Muslim Commercial Bank Limited through Chief Manager and Principal Officer v. Judge Banking Court No, 2, Faisalabad and 8 others (2002 CLD 991), has held that if the constitutional petitions are to be entertained against the interlocutory orders, it would deflect the legislative intent to promulgan, the Financial Institutions (Recovery of Finances)
Ordinance, 2001.
15. We are of the view that the learned Single Judge/Banking Court had imposed a condition in exercise of its discretionary powers in the circumstances of the case. The Honourable Supreme Court of Pakistan in a judgment reported as Pakistan through Secretary Ministry of Food and Agriculture v. Special Court (Banking) Sindh and others (1991 SCMR 2355) has observed as under:- "The order passed by respondent-1 was in exercise of its discretionary powers. Even if it is to be held that the discretion has not been exercised properly, still it cannot be denied that the Special Court had jurisdiction in the matter.
' Assuming that the order is erroneous it would not make it an order without jurisdiction and, therefore, would not attract the Constitutional jurisdiction of the High Court under Article 199 of the Constitution."
' The Full Bench of the august Supreme Court of Pakistan in a judgment reported as Messrs Zulfiqar Associates Ltd. v. Allied Bank of Pakistan Ltd. And 3 others (1985 SCMR 1570) while dealing with the question of exercise of discretion, has observed as under:- "After hearing the learned counsel of length we, however, are unable to disagree with the High Court that the grounds urged are not sufficient for exercise of Constitutional jurisdiction to upset an order passed competently in exercise of jurisdiction by the special Court. We are not satisfied that any error of jurisdiction was committed in passing the impugned order before the High Court and the contentions advanced before us clearly relate to the merits of the controversy which fell squarely within the jurisdiction of the special Court to decide."
' We are of the considered view that the discretion vested in the Court, Tribunal or Authority, if exercised in accordance with law and is not tainted with malice, cannot be interfered by this Court in its extraordinary Constitutional jurisdiction under Article 199 of the Constitution of Islamic Republic of Pakistan, 1973. It is ex facie clear from subsection (9) of Section 10 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 that the learned Single Judge/Banking Court is fully empowered to grant leave to defend the suit keeping in view the circumstances of each case.
This Section delegates the discretionary powers upon the Banking Curt that it, if thinks appropriate, may grant leave to defend the suit unconditionally or by imposing the condition as to deposit of cash or furnishing of security. We are fortified in our view by the judgments reported as Messrs Bank Alfalah Limited v. The Presiding Officer and another (2014 CLD 160), Garments (Pvt.) Ltd. v. Al- Baraka Islamic Bank and others (2010. CLD 1563), Ahmed Construction Company through Attorney v. Habib Bank Ltd., Karachi and 2 others (2005 CLD 192) and Manzoor Textile Mills Ltd. v. Special Judge Banking, Lahore and others (1996 CLC 422).
10. As far the reliance placed by the learned counsel for the petitioners upon Messrs S.M. Ayub & Co. v. National Bank of Pakistan and others (1983 CLC 2828), we are of the considered view that in the subsequent judgment i.e, Messrs Zulfiqar Associates Ltd. v. Allied Bank of Pakistan Ltd. And 3 others (1985 SCMR 1570) and Pakistan through Secretary Ministry of Food and Agriculture v. Special Court (Banking) Sindh and others (1991 SCMR 2355) the Honorable Supreme Court of Pakistan has held otherwise and, thus, relying upon the dictum laid down by the Honourable Supreme Court of Pakistan, we are unable to agree with the view given by the learned Judges in the judgments mentioned supra.
' The judgment relied upon by the learned counsel for the petitioners reported in Haji Abdul Wahid v. Hoechst Pakistan Limited and another (1993 CLC 1291) [Karachi] is distinguishable as the question relating to the maintainability of writ petition has not been discussed in the said judgment. Moreover, we have observed that reliance has been placed upon Abdul Karim Jaffarni v.
United Bank Ltd. And 2 others (1984 SCMR 568) (relied upon by the petitioners) is earlier in time and the different view has been given by a Larger Bench of the Hon'ble Supreme Court of Pakistan in Messrs Zulfiqar Associates Ltd. v. Allied Bank of Pakistan Ltd. And 3 others (1985 SCMR 1570) consisting of five Hon'ble Judges. It is an established law that where there is a conflict between two decisions of the Honourable Supreme Court of Pakistan the decision of the Larger Bench would prevail. Thus, the decision rendered by the Honourable Supreme Court of Pakistan, on the same point of law given in Messrs Zulfigar Associates Ltd. v. Allied Bank of Pakistan Ltd., and 3 others (1985 SCMR 1570), shall prevail. Reliance in this regard is placed on Fazal Mohammad Chaudhry v.
Chaudhry Khadim and 3 others (1997 SCMR 1368) and Mohammad Riasat SET (Science) and others v. The Secretary of Education, NWFP, Peshawar and 2 others (1997 SCMR 1626).
17. For what has been discussed above, we are of the view that the petitioners have failed to point out that the learned Single Judge/Banking Court did not follow the expressed mandate of law or that the learned Single Judge/Banking Court has exercised its powers outside the jurisdiction conferred upon it. Resultantly, this writ petition stands dismissed.