SHAMS MEHMOOD MIRZA, J.---This is a suit filed under section 9 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 (the Ordinance) seeking recovery of Rs,51,750,355.05 from the defendants on account of a Running Finance Facility granted to them and default by them of their payment obligations.
2. Brief facts of the case are that defendant No,1 availed a Running Finance facility in the sum of Rs,30 Million from the plaintiff bank on 28.08.2007. The tenure of the facility was one year. The said facility continued to be renewed for the next two years. Lastly, the renewal of said facility took place on 01.07.2009 when it was granted for a sum of Rs,40 Million. The details of the agreements and other securities executed by the defendants are mentioned in paragraphs Nos .5 to 8 of the plaint.
On account of the default committed by the defendants in repayment of the amounts under the Running Finance facility, a settlement agreement was executed between the parties on 18.10.2010.
Defendant No,1 acknowledged its liability to pay a sum of Rs,29,980,582.18 as principal under the said finance facility and a sum of Rs,5,884,752.47 as markup till June, 30.06.2010. Under the terms of the said agreement, defendant No,1 agreed to pay the principal amount in monthly installments with the final installment being payable on or before 31.12.2012. It was further agreed that markup will continue to be charged on the principal amount and that the current and accrued markup will be payable between 31.07.2012 and 31.12.2012. As the defendants committed default in payment of the amounts under the aforementioned agreement, the plaintiff bank filed the present suit.
3. In pursuance of the summons issued by this Court, defendants Nos.1, 2, 4 and 5 entered appearance and filed a joint application for leave to defend bearing PLA No,09/B of 2014.
4. It is stated that this Court does not have the territorial jurisdiction to entertain this suit; that the claim of the plaintiff bank is inflated; that the statement of account is not certified in accordance with law; that the plaintiff could not have charged markup under agreement dated 18.10.2010.
5. Learned counsel for the defendants stated that the finance was allowed at Multan Branch of the plaintiff bank, the defendants reside in Multan and the mortgaged property is also situated in Multan, therefore, this Court has no territorial jurisdiction to entertain the suit. This objection has no basis when the documents appended with the plaint are looked at. It is quite clear that all the finance agreements as well as the memorandum of deposit of title deeds were executed in Lahore.
The settlement agreement dated 18.10.2010 was also executed at Lahore, therefore, by virtue of section 20(c), C.P.C., cause of action has accrued to the plaintiff bank against the defendants at Lahore and this Court accordingly has jurisdiction to adjudicate upon the suit.
6. The defendants have not impugned'any entry in the statement of the account for being illegal and unlawful. The execution of agreement dated 18.10.2010 is admitted wherein the defendants have categorically admitted their liability and gave the time frame for its payment. The perusal of the statement of account shows that it is a computer generated ledger in respect of which this Court has already held in C.O.S. No,41 of 2010 titled The Bank of Punjab v. M/s Khan Unique etc. 2016 CLD 29 as under: ' In the present case, however, what the Plaintiff Bank has appended with the plaint are computer generated accounts. These accounts being the computer generated accounts/ledgers of the Plaintiff Bank, there was no need to put a certificate on the foot of such accounts as prescribed by section 2(8) of the Act and any officer of the Bank could sign the said accounts. As the original accounts have been appended with the suit, which constitute primary evidence, there is no need to file a certified copy thereof which should in turn comply with the requirements of section 2(8) of the Act. It may again be emphasized that the requirement of putting a certificate at the foot of the statement, by virtue of section 2(8) of the Act, is in regard to a copy of the accounts or an entry contained therein and not for the original accounts.
7. The allegations that the plaintiff could not have charged markup under agreement dated 18.10.2010 has no basis. In this regard, the definition of "obligation" as mentioned in section 2(e)(i) of the Ordinance is relevant and clearly shows that fresh disbursement is not necessary for charging markup. Section 2(e)(i) of the Ordinance is reproduced hereunder.
(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."
In Habib Bank Limited v. Service Fabrics Limited etc. 2004 CLD 1117, the scope of renewal/ rescheduling/restructuring of finance facilities was discussed with specific reference to section 2(e) of the Ordinance and it was held as follows.
"Renewal/rescheduling/restructuring of financial facilities only ensues upon default non-payment, delayed payment or inability, in payment of outstanding liability by a customer who normally seeks such concession upon admission and determination of liability. By soliciting rescheduling or, restructuring, as the case may be, a customer, in essence, either requests postponement of repayment of a finance on renewed terms as agreed between the parties or asks for reorganization/refurbishing of financial basis of a finance and its liquidation. By approving rescheduling/ restructuring/renewal of a financial facility, the bank forgoes its immediate right of recovery and enforcement of securities against the customer. The effect of rescheduling, restructuring and renewal of finance facility is mutually agreed by the parties to be absorbed by future interest, mark-up charges or commissions till the agreed date of liquidation of liability as has been done in the present compromise decree. Rescheduling, restructuring and renewal is also thus a facility or accommodation granted by the bank to a customer. This facility has been recognized as an "Obligation" defined in section 2(e) of Financial Institutions (Recovery of Finances)
Ordinance, 2001."
' The ratio of above judiment clearly shows that a financial Institution while granting extension in time for payment of finance can charge markup thereon.
8. Section 10 of the Ordinance by its terms imposes a mandatory requirement on the defendant to state all the particulars mentioned in its subsection (4) and to append all the necessary documents as mentioned in its subsection (5). Failure to meet the requirements of section 10(4) and (5) of the Ordinance by a defendant results in dismissal of his PLA (see Appollo Textile Mills Limited v. Soneri Bank Limited 2012 CLD 337) . It was held in the said judgment that ' A defending customer is thus obliged to put in a definite response to the banks accounting and has under sections 10(3) and (4) to compulsorily plead in answer in the leave petition his accounts as well as the facts and amounts disputed by him as repayable to the plaintiff. (emphasis supplied) ' The PLA is not at all in compliance with section 10(4) of the Ordinance and as such in terms of section 10(6) of the Ordinance is liable to be rejected. The consequence of such rejection of PLA is also spelt out in section 10(11) of the Ordinance, which clearly states that on such rejection the Banking Court shall forthwith pass judgment and decree in favour of the plaintiff. A similar consequence is also provided in section 10(1) of the Ordinance which states that dismissal of the PLA means that all the allegations made in the plaint shall be deemed to be accepted and the banking court is obliged to pass a decree thereon. It may be pointed out that defendant No,3 did not file any PLA and, therefore, decree shall follow against him.
9. The defendants have failed to raise any dispute with regard to their liability. Having admitted the execution of agreement dated 18.10.2010, the defendants are estopped from challenging any of the amounts prior to the execution of the said agreement. On account of their failure to raise any dispute on facts, the application for leave to defend filed by the defendants is dismissed. The suit of the plaintiff is decreed in its favour and against the defendants, jointly and severely, in the sum of Rs,51,750,355.05 together with costs of funds as contemplated by section 3 of the Ordinance. The costs of the suit are also granted.