SHAMS MEHMOOD MIRZA, J.---This suit filed under section 9 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 (the Ordinance) seeks recovery of Rs. 140,304,744.64 from defendants Nos.1 to 3 (the defendants).
2. Briefly stated the facts of the case are that the defendants had been availing various finance facilities from the plaintiff bank. In this regard, lastly facility offer letter was issued on 28.04.2010 whereby CF (Pledge) facility for Rs.120.000 Million, RF facility for Rs.50.000 Million and FADD facility for Rs.10.000 Million were allowed to the defendants with expiry on 31.01.2011. The defendants executed the finance documents including the personal guarantees in respect of the aforementioned finance facilities, the details whereof are mentioned in the plaint. The expiry of the finance facilities was extended up to 31.08.2011 by the plaintiff bank at the specific request of defendant No.1 made through letter dated 26.01.2011. Consequently, the defendants executed the supplementary finance agreements on 27.01.2011, 26.02.2011, 29.04.2011, 30.05.2011, 30.06.2011 and 29.07.2011 in terms of the temporary extensions granted by the plaintiff bank. As the defendants failed to repay the amounts under the finance facilities, the plaintiff bank was constrained to file the present suit.
3. Pursuant to the summons issued by this Court, the defendants filed their joint application for leave to defend bearing PLA No.08 of 2015. Learned counsel for the defendants in support of the grounds taken in the application for leave to defend stated that the period of the finance facilities came to an end on 31.01.2011, which could not be extended by temporary extension and that the liability of a customer cannot be increased by extension of time. The levy of mark up for the period for temporary extensions granted by the plaintiff was, therefore, disputed. It was further stated that there were numerous unexplained debit entries in the statement of accounts, the details whereof were mentioned in paragraph 8(c) of the application for leave to defend.
4. Learned counsel for the plaintiff bank, on the other hand, submitted that the period of the finance facilities was extended from time to time on the request of the defendants and as such the defendants cannot raise any dispute in regard thereto. It was also submitted that all the debit entries disputed by the defendants were duly reflected on the credit side in the current statement of account, which was appended with the replication filed by the plaintiff bank.
5. The availing of the finance facilities and the execution of the documents is not denied by the defendants. Defendant No.1 through its letter dated 26.01.2011 specifically asked for the extension in the expiry date of the finance facilities. Accepting the request so made by defendant No.1, the plaintiff issued various offer letters on 27.01.2011, 26.02.2011, 29.04.2011, 30.05.2011, 30.06.2011 and 29.07.2011, which offer letters were duly accepted by defendant No.1 by putting its signatures thereon. Pursuant to the issuance of the offer letters, the parties also executed supplementary finance agreements from time to time. The defendants are, therefore, liable to pay the mark up for various extensions sought by them. In Habib Bank Limited v. Service Fabrics Limited and others 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."
In view of the ratio of the aforementioned judgment, the plaintiff bank was entitled to charge mark up for the period for which the finance facilities were extended and remained operative.
6. As regards the debit entries in the statements of accounts, which according to the defendants were un-explained, this Court has gone through the statement of current account of defendant No.1 appended with the replication. The credit of all the impugned debit entries is reflected in the statement of current account of defendant No. 1. The plaintiff bank has, therefore, substantiated the disbursal of amounts Under the impugned debit entries. The statement of current account appended with the replication was objected to by the defendants' counsel on the ground that the said statement of account ought to have been appended .with the suit and this Court cannot look into the said document. This submission has no merit in it. In a judgment reported as The Bank of Punjab v. Messrs Khan Unique Developers. Limited 2016 CLD 29, this Court held as under:- A defendant who neither appends the statement of current account with his application for leave to defend nor pleads sufficient reasons and circumstances for its absences and also does not file an application under section 6 of the Act cannot object to the filing of his statement of current account with the replication filed by the plaintiff. In such an eventuality, the statement of current account appended with the replication can be looked at by a Court as it is not a liability creating document. It may also be pointed out that in the series of banking recovery laws promulgated from time to time, the Ordinance is the only legislation where the filing of reply to the application for leave in the shape of replication is provided. The object of course is to provide the plaintiff with an opportunity to rebut the averments contained in the application for leave to defend filed by a defendant and if need be, to file documents to support such rebuttal. This is not to say that a plaintiff bank can append any type of document with the replication more particularly the primary documents which create liability and which under the terms of the Ordinance are required to be appended with the plaint. However, where a defendant is obliged to append a document with its application for leave to defend the suit for rebuttal of the liability and does not do so, the plaintiff bank can append the said document with its replication.
7. The defendants have failed to raise any dispute in their application for leave to defend qua their liability. Their application for leave to defend is dismissed. Consequently, the suit filed by the plaintiff is decreed in its favour and against defendants Nos.1 to 3, jointly and severally in the sum of Rs. 140,304,744.64 together with costs of funds as envisaged by section 3 of the Ordinance. Costs of suit are also granted.