' MUHAMMAD KHALID MEHMOOD KHAN, J.---The respondent-bank filed a suit against the appellants for the recovery or Rs,32,054,325.81 claiming that appellant No,1 is a private limited company and is doing business of installation of medical unit for manufacturing and sale (local export) of disposable syringes, needles, catheters and branuallas etc. Appellants Nos.2 to 5 are its directors: appellant No,1 availed finance facility of Rs,38 Million in the following terms:- Sr. No,Financial Facilities Amount - I.Running Finance/Export Re- Finance (Part-I and II) interchangeable28.00 Million 2.Letter of Credit (Usance and Sight)
Interchangeable10.00 Million TOTAL38.00 Million
2. The said facilities were valid upto 30.06.2010. The appellants Nos. 1 and 2 mortgaged its immovable properties for securing the finance and appellants Nos.2 to 5 executed the agreement of personal, guarantees guaranteeing the repayment of finance availed or to be availed of by appellant No,
1. The detail of mortgaged properties of the company and appellant No, 2 is given in para 10 of the plaint. It is asserted that the Running Finance Facility was payable with 16% mark-up, the letter of credit facility was valid for 90-days from the date of bills of lading. The appellant No, 1 took delivery of the goods imported under the letters of credit (POLYPROPYLENE INJECTIONS GRADE 100N QUANTITY 24.75 M.TONS & PVC COMPOUND FOR SYRINGE GASKETE 15,000 KGS & 11,000 KGS but failed to pay the corresponding amount which resulted in the creation of forced finance (PAD); the appellants after adjusting margin of Rs,750,000/- created a demand finance of Rs,3,503,611.50. The appellants partially adjusted the said .Facility and at present a sum of Rs,2,165,638.50 is outstanding in the account of L/C. The appellants also availed Export Re-Finance. The Export Re- Finance amounting to Rs,5,328,000/- is outstanding against the appellants. The appellants were issued legal notice; the appellants accepted the liability but failed to adjust the same inspite of their own promise. The amount availed by the appellants is detailed in Para-19 which shows that all the three accounts i.e, Running Finance, PAD and ERF, Principal Amount of Rs,28,695,223.12 is outstanding, Rs, 3,359,102.69 is outstanding in the account of mark-up and total outstanding liability with mark-up is Rs,32,054,325.81 which is recoverable from the appellants. The total break- up of the facility has been given in para-21 of the plaint.
3. The appellants filed an application for permission to defend the suit raising the preliminary objections as well as objections on facts. The very institution of the suit was objected on the ground that the executant of the plaint is AVP/Manager which did not fulfill the requirements of section 9 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 (hereinafter referred to as "FIO, 2001"); the documents attached with the plaint are contradictory with each other as they contain different dates; the 'appellants further objected that all the-L/Cs are shown to be issued or opened before the sanction of Finances which were admittedly sanctioned on 05.08.2009; the original sanction letter is not available on record and the respondent has changed one page of sanction letter; the replaced/changed/forged documents show that the rate of mark-up has been enhanced by the respondent; the suit has been filed with mala fide intention to blackmail and harass the petitioner; the proper summary of the finances as required under section 9(3) of F.I.O., 2001 has not been provided and as such the suit is liable to be dismissed forthwith; the statement of account annexed with the plaint about the Running Finance shows that the entire amount has not been utilized by the appellants; entry of Rs,20.707,658.61 is brought forward entry which the appellants never availed; all the entries of mark-up are fake and wrong; the amount of Rs,2,774 919.91 has wrongly been debited to the appellants' account in the shape of mark-up; in para-21 of the application, it is stated that the appellants utilized a sum of Rs, 11,89,668.02; the amounts shown to be utilized are the amounts of RF amounts, no other amount was disbursed in account of L/C Sight and Since; further stated that the whole amount of principal as well as mark-up on account of mark-up was paid rather the amount has been paid in excess of the .Liability and nothing is payable in the RF account and the entire suit amount is being disputed.
4. Learned trial court after hearing the parties dismissed the appellants' application for permission to defend the suit vide judgment and decree dated 28.08.2012.
5. Learned counsel for the appellants submits that the learned Banking Court has failed to appreciate that the appellants have raised substantial question of law and facts which could only be resolved after recording the evidence; that the appellants have specifically stated that Azra Ajaz Khan while signing the plaint has affixed her rubber amp as under:- "AZRA AJAZ KHAN AVP/Manager Main Branch Lahore IBS:186 131 A/E-1 Gufberg III, Main Boulevard, Lahore"
' The argument of learned counsel for the appellants is that under section 9 of F.1.0., 2001, the Manager alone has the authority to sign and verify the plaint but not AVP; admittedly Ms. Azra Ajaz Khan is AVP (Assistant Vice President), hence, the very institution of the suit was defective and as such the appellants were entitled for the grant of unconditional leave to defend the suit. Learned counsel submits that the statement of current account clearly shows that the entry of Rs,20,707,658.61 is already a brought forward entry whereas according to the contents of the plaint the facility was sanctioned on 05.08.2009 and the debits in the account should have been after 05.08.2009. Learned counsel submits that the facility of Running Finance was utilized to the extent of Rs,8.00 Million only which the appellants have already paid as is evident from the statement of account itself; after deducting a sum of Rs 20,707,658.61 the total amount deposited by The appellants is Rs,8,729,66.92 which is more than the amount of Rs,8.00 Million which was allowed to the appellants. Learned counsel submits that the statement of account of respondent is sufficient to prove that the appellants have already paid and adjusted the liability. Learned counsel further submits that L/Cs were opened even prior to the sanction of finance as is evident from the plaint; further no document of L/C is available on record confirming that the appellants ever opened any letter of credit. Learned counsel submits that the amount of PAD could not be generated in the appellants' account in the absence of opening of any letter of credit. As far as Export Re-Finance is concerned, learned counsel states that this amount was never disbursed to the appellants and as such the said amount is recoverable from the appellants. Learned counsel finally submits, that the appellants have raised substantial questions of law and facts which can only be decided after recording the evidence but the learned Banking Court has not considered the objections raised by the appellants.
6. Learned counsel for the decree-holder/respondent supports the judgment and decree and states that the learned trial court has attended to all the objections raised by the appellants but the appellants have failed to point out any substantial questions of law and facts which can be resolved after recording of evidence.
7. Heard. Record perused.
8. The first argument of learned counsel for the appellants is that the suit has not been filed by the duly authorized person and Ms. Azra Ajaz Khan is not the Branch Manager in terms of section 9 of F.I.O., 2001. Relevant portion of section 9 of F.I.O., 2001 reads as under:- ' In the case of financial institution by the Branch Manager or .Such 'other officer of the financial institution as may be duly authorized in this behalf by power-of-attorney or otherwise".
9. Bare perusal of the provisions of section 9 of F.I.O. 2001 will show that the word "Branch Manager" has been used. If the plaint has been signed or 'instituted by the Branch Manager even no power of attorney is required to the Branch Manager. In para-3 of the plaint, respondent specifically stated that the suit is being filed through its Branch Manager namely Mrs. Azra Ejaz Khan and in the verification of the plaint Azra Ajaz Khan has affixed signatures with her rubber stamp which clearly establishes that Azra Ajaz Khan is AVP/Manager Main Branch, Lahore: It is admitted fact that the suit has been filed by the main Branch of the respondent-bank. Learned counsel for the appellants is confusing the Branch Manager with AVP, AP is a designation in a bank and AVP may be the Manager of any branch of the Bank. Mrs. Azra Ejaz Khan is specifically disclosing that she is the Manager of the Main Branch, Lahore and her designation is AVP. This argument of the learned counsel thus fails and stands repelled.
10. The other argument of learned counsel for the appellants is that the amount of Rs, 20,707,658.61 in the company's current account has been shown as brought forward whereas the appellants were allowed finance on 05.08.2009; the first entry is thus dated 10.08.2009 which is of Rs, 24,000/-.
The respondent has placed on record a resolution of the Board of Directors of the company; the said document is available at page 67 of the main file which shows that the Board of Directors of the appellants discussed and the Board convened the meeting only for the renewal/extension of the financial arrangement with the First Women Bank and the Resolution specifically provides as under:- "Be and is hereby RESOLVED: ' That the company seeks renewal of the following facilities from First Women Bank Limited. Which it is presently availing at the Main Branch Gulberg, Lahore on such terms and against such securities as may be mutually agreed by the Bank and the Company: 'Interchangeable Facilities 'Running Finance and Export Refinance Part II and Export Refinance Part I upto Rs, 30.00 Million.
'Letter of Credit (S&U) upto 10.00 Million".
11. On the basis of said resolution the Managing Director who was authorized to negotiate the finance facilities with the Bank addressed a letter to the Manager First Women Bank Limited on 24.04.2009 confirming that presently the Company is enjoying the accommodation with the Bank in the following accounts:- R/F Rs. 20.90M ERF-II Rs. 4.10M 25.0 (M)- Interchangeable L/C(S) Rs. 2.00M L/C(U) Rs. 10.00M 12.0 (M)- Interchangeable
12. It was further stated that the Company offers the securities as under:-
1. Mortgage of properties bearing Khasra # 680, 681 and 683 measuring 12K and 17M at Mouza Bhichokay Mohja Raiwind Road, Lahore owned by Ravi Medical Supplies (Pvt.) Ltd. And Muhammad Nasim.
2. 1st Exclusive charge over fixed and current, present and future assets of the Co. Including Land, Machinery; Stocks, Book Debts etc. Etc.
3. 10 and Cash Margin against each L/C (U).
4. P.G. Of all Directors and owners of the properties. EE Statement for 2007-2008, Lien on firms contracts and followed by L/Cs.
13. The necessities for enhancement of finance are also detailed I letter of request. The respondent- bank allowed the facility vide sanction letter dated 05.08.2009 on the request of appellant- company; the respondent-bank sanctioned Rs,28.00 Million against the request of Rs,30.00 Million of Running Finance and ERF Part-I and II and the request of Rs,10.00 Million of L/C Sight and Usance was allowed against the request of Rs,10.00 Million. The securities accepted are also mentioned in this case.
14. From the above said documents which are not disputed by the appellants, the resolution and letter of request for allowing the facility available at pages-67 and 71 establish that the appellants were availing the finance facility prior to sanction subject matter of the suit and entry -of Rs,20,707,658.61 represents the entry of utilized amount.
15. The third argument of learned counsel for the appellants is that all L/C or L/Cs were opened prior to the sanction. All the letters of credit were opened on the request of appellant No,1; the requests are available on the record from pages-367 to 371. The application for opening an irrevocable letter of credit was duly signed by the Managing Director of the Company. It is further established on record without any iota of any doubt that the appellants also signed the trust receipts which are available at pages-347 and 365. These trust receipts establish beyond any shadow of doubt that the L/Cs were opened for importing the goods. When the goods reached, the appellants requested for the delivery of those goods without making payment against the trust receipts. The respondent-bank believing the appellants has delivered the goods imported the goods under the above said L/C. The appellants company accepted the bill of exchange drawn under different letters of credits; one bill of exchange is available at page 317 of US$ 15,210. The trust receipts as well as the bill of exchange are not denied by the appellants. Hence, it is proven fact on record that the appellants opened the letters of credit. The Bank after handing over the documents of title of the imported goods to the appellants against the trust receipts created a 'forced finance (PAD).
16. The next argument of learned counsel for the appellants is that they never utilized the amount of Export Re-Finance. The appellants' application for the grant of Export Re-Finance of Rs,5,328,000/- is available at page 375 along with certificate, DP, Note, application, Undertaking' the Manufacturing Indent.
17. The above said documents clearly establish that ERF was requested by the appellants and the bank 'allowed the same. The statement of current account clearly shows that the amount of ERF-II was disbursed to the appellants' account on 29.08.2009, the said amount is Rs,5,328,000/- and this is the amount which the appellants requested for sanction as per letter of request dated 29.08.2009 available at page 375.
18. The last argument of learned counsel for the appellants is that the statement of account has not been prepared in accordance with Bankers' Books Evidence Act, 1891. All the statements of accounts are certified under section 4 of Bankers' Books Evidence Act, 1891. The appellants have failed to point out a single entry which according to them is not according to law. The statement of account along with certificate under section 4 of Bankers' Books Evidence Act, 1891 is admissible per se unless objected or the account holder points out any discrepancy and rebuts the same.
19. Learned trial court has already disallowed the respondent's claim of mark-up and decreed the suit for Rs,26,529,584.12 of Running Finance Account and Rs, 1,165,638.50 on L/C facility. The Bank has not filed any appeal against the order of learned Banking Court for disallowing the mark-up.
20. The above said facts will show that no legal or factual question was raised by the appellants which requires recording of evidence. The learned Banking Court was justified to dismiss the appellants'. Application for permission to defend the suit. We thus dismiss the appeal as the appellants have failed to point out any legal infirmity in the 'judgment of learned trial court.