1. ABDUL HAYEE KURESHI, ACTG. C. J.--This First Appeal was filed on 16th December, 1981 under section 12 of the Banking Companies (Recovery of Loans) Ordinance, 1979, read with section 3 of the said Ordinance and section 96, C. P. C. A suit had been filed by the respondent/Bank against the appellant and two other defendants for recovery of Rs. 1,02,43,422.08.
2. An application was made by the appellant/defendant for grant of permis--sion to defend the suit, but such permission was declined by the Judge of the Special Court on the ground that no triable issue arose in the case.
3. Admittedly, the appellant has not deposited any amount nor had he sought any permission from the for Court Security. Subsection (5) of section 12 of the Banking is furnishing Companies (Recovery of Loans Ordinance reads as follows :- "(5) No appeal shall be admitted for hearing unless the appellant deposits in cash with the High Court an amount equivalent to the judgment debt or, at the discretion of the High Court furnishes security equal in value to such amount."
4. It would appear that an appeal cannot be admitted for hearing by this Court, unless an amount equivalent to the judgment debt is deposit--ed, or at the discretion of the Court, security is furnished to the extent of the judgment debt. However, when the appeal came up for admis--sion before the Division Bench, the same was admitted. It would appear from the admission order of the bench that the provisions of deposit, or, furnishing security before the admission of appeal had not been succinctly brought to the notice of the Bench. In any case, the admission order does not show that the Judges of the Admitting Bench considered that question. In these circumstances, the plaintiff/respon--dent made an application on 21st January, 1982 (C. M. A. No. 234/1982) under Order XLVII, rule 1, C.P.C. Or, in the alternative, under section 151, C. P. C., seeking an order of re-view, or, recall of the earlier order of admission of the appeal on the ground that the provisions of section 12(5) of the said Ordinance had not been complied with, and therefore, the appeal could not have been admitted. This application came up for hearing on 25th January, 1982, before a Division Bench consisting of Mr. Justice Saeeduzaaman Siddiqui and Mr. Justice Ghulam Muhammad Kourejo. The learned Judges directed that the application being one for review of the order should have been placed before the same bench. In any case, since the application was for re-call of the earlier order of admission, it would only be proper if such application was placed before the same C Bench that admitted the appeal. We would, therefore, order accordingly and defer consideration of C. M. A. No. 234/1982.
5. The other application before us i.e. C. M. A. No. 3645/1981, is under Order XLI, rule 5, C. P. C. For stay of the decree passed by the Special Judge. Mr. A. A. Zari, the learned counsel for the appellants, has raised the point that the order of the learned Special Judge was a void order, as it had been passed without jurisdiction. He submitted that the relationship between the parties was not that of creditor and debtor, nor could the amount involved in the case be considered to be a loan. His next contention before us was that we should not give effect to the provisions of section 12(5) of the Banking Companies Ordinance, as it was harsh, and, in any case, such security, or, deposit as may be ordered by this Court, in the circumstances should not be ordered in the present case.
6. Mr. A. A. Zari has, however, stated that the appellant was neither a borrower nor did the transaction amount to obtaining of loan. He stated that a substantial property had been mortgaged with the respondents, and they were secured. Such argument of Mr. A. A. Zari completely overlooks the provisions of clause (h) and clause (d) of section 2 of the Banking Companies Ordinance. Clause
(b) defines a "borrower" as a person who has obtained a loan from a banking Company, and clause (d) defines a "loan" by an enveloping definition, which provides that loan includes a guarantee, indemnity, letter of credit, or, any other financial engagement, which a Banking Company may give, issue, or, undertake on behalf of a borrower. It is, therefore, clear that, if a person obtains an aid of a Banking Company to furnish guarantee, or, any other financial engagement on behalf of a borrower, the same shall be con--sidered to be a loan, and consequently the person, obtaining such loan,, being termed as a borrower. Admittedly, the respondent/plaintiff did' offer guarantee on behalf of the appellant, and therefore it cannot be said that the appellant was not a borrower, or, that the transaction did, not amount to creating relationship of borrower and lender.
7. Mr. A. A. Zari next contended that the provisions, requiring the deposit, or, furnishing of security before admission of appeal, were harsh, and he relied on the observations of the Supreme Court in the case of Messrs Eastern Rice Syndicate v. Central Board of Revenue (PLD 1959 SC 364) and pointed out the following passage appearing at page 373 of the reports :-- Operated in the way in which these provisions have been operated in the present cases, they are mere instruments and agencies of oppression, and it is with great regret that we observe that the appellate authority being cognizant of the very heavy penalties imposed should have regarded it as a sufficient discharge of its duty to dispose of the appeals on the bare ground of non-deposit of the full amount of the penalties."
8. Mr. Zari next contended that the respondents were secured, so that security, or; deposit may, be dispensed with. We must state that the security referred to section 12(5) of the Banking Companies Ordinance is aliunde and independent of the security which in H circumstances may be the subject matter of the suit itself. The security under section 12(5) of the Ordinance is designed to control jurisdiction of the Court and such security is entirely independent. In any case, on furnishing security in this Court, the appellant could make an applica--tion for permission to sell the property already mortgaged and such application shall be considered on merits.
9. The application made by the respondents for re-call of the order of admission shall be placed before the Bench of the Judges that admitted the appeal.