' M. SOHAIL IQBAL BHATTI, J. --- Through this appeal, appellants have challenged the order and decree dated 10.4.2013 passed by learned Judge Banking Court-I, Lahore.
2. The facts of the case are that the respondent-bank filed a Suit for Recovery of Rs, 12,19,480/- against the appellants. In response to the summons issued under Section 9(5) of the Financial Institutions (Recovery of Finances) Ordinance, 2001 the appellants appeared and filed an application for grant of leave to appear and defend the suit. The learned Judge Banking Court through impugned order dated 10.4.2013 dismissed the application for grant of leave to appear and defend the suit filed by the appellants and passed the decree for recovery of Rs, 11,81,619.12 alongwith costs of suit and cost of funds. Hence, this appeal.
3. Learned counsel for the appellants has argued that the order and decree is void under the law and has been passed without looking into the record. It has been further argued that the impugned order and decree is sketchy and passed in a slipshod manner which is not warranted under the law. Although no objection has been raised either in the application for grant of leave to appear and defend the suit nor in the grounds raised in the memo. Of Appeal that the Statement of Accounts has not been prepared in accordance with The Bankers' Books Evidence Act, 1891, but the mainstay of the arguments of the learned counsel for the appellants was that the Statement of Accounts appended with the plaint did not mention that the same has been certified by the Branch Manager or the Principal Accountant as provided in Section 2(8) of The Bankers' Books Evidence Act, 1891 and would thus be not considered as a certified copy. Learned counsel for the appellants has relied upon Bankers Equity Limited through Principal Law Officer and 5 others v.
Messrs Bentonite Pakistan Limited and 7 others (2003 CLD 931) [Lahore], Bankers Equity Limited and 5 others v. Messrs Bentonite Pakistan Limited through Chief Executive and 7 others (2010 CLD 651)
[Lahore], Pakistan Kuwait Investment Company (Pvt.) Limited through Authorized Representative v.
Messrs Active Apparels International and 6 others (2012 CLD 1036) [Sindh], Messrs Soneri Bank Limited v. Messrs Compass Trading Corporation (Pvt.) Limited through Director/Chief Executive and 3 others (2012 CLD 1302) [Sindh], Messrs Muzamil Brothers and another v. Saudi-Pak Commercial Bank Limited through Manager (2006 CLD 1546) [Lahore], Elbow Room and another v. MCB Limited (2014 CLD 985) [Sindh] and Habib Metropolitan Bank Limited v. Abid Nisar (2014 CLD 1367) [Sindh].
4. On the other hand, learned counsel for the respondent-bank argued that the ground regarding Statement of Account has not been raised by the appellants either in their application for grant of leave to appear and defend the suit nor in the grounds of memo. Of Appeal; however the learned counsel while relying upon the provisions of Section 9 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 arguad that the Statement of Accounts has been duly certified and signed by the Branch Manager, although it has not been mentioned on the foot of the Statement of Accounts or under the signatures of the concerned official that the Statement of Accounts has been certified by the Branch Manager but the signatures on the plaint (signatures of the Branch Manager) and the signatures under the certificate are of the same individual and non-mentioning of the name is a mere irregularity. Learned counsel further argued that merely non-mentioning of the designation of the "Manager" or "Principal Accountant" would not result into the rejection of the plaint especially in the circumstances when no credit or debit entry has been disputed. The learned counsel while referring to the word 'shall' as used in Section 9(1), (2) and (3) of Financial Institutions (Recovery of Finances) Ordinance, 2001 argued that merely using of the word 'shall' in these provisions does not make it a mandatory provision as no penal consequences have been provided in the law. To strengthen his arguments learned counsel has drawn our attention towards Section 10 (3), (4) and (5) of the Financial Institutions (Recovery of Finances) Ordinance, 2001 and argued that these provisions are mandatory for the reason that non-compliance with these provisions entails penal consequences in sub-section (6) of Section 10 of the Financial Institutions (Recovery of Finances) Ordinance, 2001. Learned counsel further argued that even otherwise the computer generated statement need not be certified under The Bankers' Books Evidence Act, 1891 [Act No, XVIII of 1891]. Learned counsel for the respondent-bank has placed reliance on Habib Metropolitan Bank Ltd. v. Mian Abdul Jabbar Gihllin and another (2013 CLD 88) [Sindh], NIB Bank Ltd. v. Highnoon Textile Ltd., and 3 others (2014 CLD 763) [Lahore], IGI Investment Bank Limited through Attorney v.
Messrs Admore Gas (Pvt) Ltd. And another (2014 CLD 1354) [Sindh], Equity Participation Fund v.
Messrs Abbrasive Products Co. Limited and 4 others (2012 CLD 971) [Sindh], Habib Bank Limited through authorized Attorney v. Haidri Homes through Partners and 3 others (2012 CLD 2016)
[Lahore] and the judgment passed by this Court in C.O.S.No, 41 of 2010 titled The Bank of Punjab v.
M/s. Khan Unique, etc.
5. We have considered the arguments advanced by the learned counsel for the parties and have also gone through the record.
6. The main stay of the arguments of the learned counsel for the appellants is that the Statement of Accounts appended with the plaint has not been duly certified under The Bankers' Books Evidence Act, 1891. The term "certified copy" has not been defined in the Financial Institutions (Recovery of Finances) Ordinance, 2001 but Section 2(8) of The Bankers' Books Evidence Act, 1891 defines the term certified copy which reads as under:- "2. Definitions.---In this Act, unless there is something repugnant in the subject or context:- (1)
(2)
(3)
(4)
(6)
(7)
(8) "certified copy" means a copy of any entry in the books of a bank together with a certificate written at the foot of such copy that it is true copy of such entry, that such entry is contained in one of the ordinary books of the bank and was made in the usual and ordinary course of business and that such book is still in the custody of the bank, such certificate being dated and subscribed by the principal accountant or manager of the Bank with his name and official title."
7. The Statement of Accounts filed with the plaint has been certified by an official who has signed the plaint being the Manager and if the designation of the official being the Manager has not been mentioned under the certificate upon the Statement of Accounts it can only be termed as a mere irregularity. In the present case, we have observed that the respondent-bank has appended with the plaint the computer generated statement of accounts; and there was no need to put a certificate on the foot of such accounts; as the original Statement of Accounts has been appended with the suit which constitutes primary evidence. This issue has been discussed in a judgment reported in Habib Metropolitan Bank Ltd. v. Mian Abdul Jabbar Gihllin and another (2013 CLD 88)
[Sindh] wherein it has been held as under:- "It is observed that rapid changes have occurred in the recent years as old and conventional system of banking has been done away with to a greater extent. In spite of having conventional and old method banking system latest technology has taken over by way of introduction of electronic and digital methods. It is seen that the defendant has not denied the obtaining of credit facility but has only called in question the statement of accounts prepared electronically by submitting that these statements neither bears signature of bank official nor bank seal.
Whereas these statements of accounts clearly stipulate that these are electronically generated documents and do not require any signature. Hence in my view these statements of accounts through which complete picture of the credit facility obtained by the defendants is quite visible would not be considered to be a document having no legal authenticity."
8. Although we have observed that an official who has signed the certification at the foot of the Statement of Accounts has not been mentioned as the Branch Manager. It would be useful to refer to a judgment reported in /GI Investment Bank Limited through Attorney v. Messrs Admore Gas (Pvt.) Ltd. And another (2014 CLD 1354) [Sindh] wherein in the identical circumstances it was observed as under:--- "I have heard the learned counsel for the parties at length, and have also examined the law cited by them at the bar as well as the material available on record. Regarding the defendants' objection that the plaintiff has charged mark-up over markup, I am of the considered view that at this stage the defendants have no right to raise any such objection that was raised by them in their application for leave to defend, as their said application has already been dismissed.
Even otherwise, not a single entry or illustration was pointed out by the defendants in their application for leave to defend, or at the time of the final hearing, to show any incorrect or illegal debit entry in the statement of account filed and relied upon by the plaintiff, or any discrepancy therein, or any such amount that was allegedly charged by the plaintiff as mark-up over mark- up. Such omission on the part of the defendants is significant and has a direct impact on the objection raised by them regarding the authenticity and admissibility of the plaintiff's statement of account on the ground that the same is not in accordance with Section 2(8) of the Act of 1891 and Section 9(2) of the Ordinance. It is well-settled that a statement of account carries presumption of truth by virtue of Section 4 of the Act of 1891 when the entries therein are not rebutted with cogent reasons. In this context, I would like to refer to the cases of Sh. Abdul Sattar Lasi v. Federation of Pakistan through Secretary, Ministry of Law, Justice and Parliamentary Affairs, Islamabad and 6 others, 2006 CLC 18 (Division Bench); Messrs International Traders and others v. Union Bank Limited, 2003 CLD 1464, (Division Bench); Messrs United Steel Corporation, Moman Pura, Darughawala, G.T. Road, Lahore and 4 others v. Muslim Commercial Bank Limited, 1999 YLR 2071 (Division Bench); Grindlays Bank Limited v. Messrs Cheap John, 1992 CLC 1108 and United Bank Ltd., v. Messrs Sartaj Industries through Qaisar lqbal, Managing Partner and 6 others, PLD 1990 Lahore 99. Similar view was taken very recently by an Hon'ble Division Bench of the Lahore High Court in the case of Habib Bank Limited supra, relied upon by the learned counsel for the plaintiff, wherein it was held that since no entry of the statement of account had been challenged and no rebuttal of the statement of account was on record, the statement of account prepared and maintained by the financial institution was correct and the Suit was maintainable."
' The learned Judge went on to observe in Para No, 11 as under:- "lt is my considered opinion that the statement of account filed by the plaintiff cannot be discarded I and the plaintiff cannot be non-suited only for the( reason that instead of the titles 'Principal Accountant' or 'Manager, the title 'Senior Manager' is mentioned with the name of the plaintiff's officer who has certified the statement of account, especially when the statement of account does contain a certification at the foot. In view of the above discussion, the objection raised by the defendants is hereby rejected, and it is held that the statement of account filed by the plaintiff fulfills the requirements of Section 2(8) of the Act of 1891 and Section 9(2) of the Ordinance."
9. We are of the considered view that in an application for leave to defend filed by the appellants there is no rebuttal of the Statement of Account and as such the argument of the learned counsel for the appellants that the suit is not maintainable is misconceived. Certified Statement of Accounts is available on record and no entry of the same is challenged and as such it will be presumed that the Statement of Accounts appended with the plaint is correct.
' As we have observed that the plaint was accompanied by certified Statement of Account and no entry of the Statement of Account was challenged in the application for leave to defend the suit and as such the Statement of Account shall be presumed to be correct. The Statement of Account having certificate under Section 4 of the Bankers' Books Evidence Act, 1891 was admissible especially whey there was no opposition and there was no objection against any debit entry. In absence of any rebuttal the amount due according to the Statement of Account would be deemed to be the correct liability of defendant.
10. At this stage, it would be useful to refer to Section 9 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 which provides a complete procedure and mechanism for bringing a Suit in the Banking Court. It requires in the terms of sub-section (2) that "plaint shall be supported by the Statement of Account which in the case of the financial institution, shall be duly certified under The Bankers' Books Evidence Act, 1891 and other relevant documents relating to the grant of finance". The provisions of sub-section (3) provide the manner in which fact regarding the finance disbursed by the financial institution, repayment with date made by the customer and the amount payable by the customer is also required to be elaborated in the plaint. Correspondingly Section 10 of the Ordinance, 2001 deals with the leave to defend application required to be filed by the defendant. Sub-section (3) provides that the leave to defend application shall be in the form of written statement containing a summary of the substantial questions of law as well as facts, which in the opinion of the defendant call for recording of evidence and leave to defend application which has not been drafted in accordance with the provisions of Section 10(3)(4) and (5) merits rejection in terms of subsection (6). Sub-section (6) of Section 10 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 reads as under:--- "An application for leave to defend which does not comply with the requirements of sub- sections (3), (4) where applicable and (5) shall be rejected, unless the defendant discloses therein sufficient cause for his inability to comply with any such requirement."
11. It is a settled principle of law that one of the essential feature of the mandatory provisions is not merely use of word "shall" which may be used merely to stress importance of compliance of a particular requirement. Ordinarily where consequences of failure to comply with the direction or requirement of statute are not stated, the direction is treated as directory and not mandatory. In the case reported in CITIBANK N.A. v. JUDGE, BANKING COURT-IV and 2 others (2001 CLC 171) [Lahore] the recovery suit of the bank was dismissed being incompetent simply on the ground that the plaint was not accompanied by the Power-of-attorney but the learned Division Bench of this Court noted that though requirement of law was to file plaint alongwith the Power-of-attorney but Section 9 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 had not provided that if a copy of the Power-of-attorney is not filed alongwith the plaint, the plaint would be dismissed.
We are of the considered opinion that the suit cannot be dismissed in the circumstances of the present case. At this stage, it would be useful to refer to the application for leave to defend the suit filed by the appellants. We have observed that the application for leave to defend the suit has not been drafted in accordance with the provisions of Section 10(4) of the Financial Institutions (Recovery of Finances) Ordinance, 2001. The Hon'ble Supreme Court of Pakistan in a judgment reported in Apollo Textile Mills Ltd., and others v. Soneri Bank Ltd. (2012 CLD 337) has discussed the effect of non-compliance with the provisions of Section 10(3)(4) and (5) of the Financial Institutions (Recovery of Finances) Ordinance, 2001 as under:- "19. In this case, the application for leave to defend the suit filed by the petitibners did not fulfill the requirements of Section 10(3), (4) and (5) of the Financial Institutions (Recovery of Finances) Ordinance, XLVI of 2001. It was admittedly not in conformity with the said mandatory provisions. No cause or the reason for inability to comply with said requirements was shown.
Instead it was expressly admitted by the learned Senior Advocate Supreme Court for the petitioners before the High Court and also before us that the petitioners failed to fulfill the mandates of the said provisions and did not plead the required Accounts. The petitioners/defendants thus attracted the prescribed legal consequences of:---
(i) rejection of their leave petition under Section 10(6);
(ii) non-entitlement under Section 10(1) to defend the suit for not obtaining leave to defend the suit in terms provided for in Section 10;
(iii) the allegations of fact in the plaint were deemed under Section 10(1) to have been admitted by them; and
(iv) a judgment and decree against them and in favour of the plaintiff-bank under Section 10(1) and 11 ibid.
12. For what has been discussed above, the appeal is dismissed.