' JAWAD HASSAN, J.---Through this appeal, the Appellants have assailed the judgment and decree dated 20.05.2013 passed by Judge Banking Court-IV, Lahore, in the suit filed by Respondent No,l.
2. Brief facts for the disposal of this appeal are that the M/S NIB Bank, (Respondent No,1) filed a suit against Ijaz Nizam textile Mills and two others for recovery of a sum of Rs,29,419,970/- with cost of funds against the Appellants/Defendants from the date of institution of the suit, till final realization under section 9 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 (the "2001 Ordinance"). The Appellant No,1 /Defendant No,1 being a customer had availed a Running Finance Facility of Rs,26,000,000/- vide approval letter dated 24.5.2008.Defendant No,2/Appellant No,2 Muhammad Ijaz and Defendant No,3/Respondent No,2, Muhammad Ali Joyya being mortgagor and guarantor furnished adequate guarantees, including their personal guarantee. When the Appellants Nos.1 and 2/Defendants Nos.1 and 2 failed to liquidate their liability, they were called upon to adjust the amount, the defendants then moved an application on 18.02.2009 for restructuring/rescheduling of their Running Finance of Rs,26,000,000 by converting into Term Finance. Consequently, vide letter dated 11.03.2009, the Bank approved the request and converted the same into Term Financing-Special Transaction (TL) Renewal/Restructuring Facility. It was stipulated in the Term Financing-Special Transaction (T) to liquidate the liability within a period of five months from the date of approval. In order to further secure the re-payment of loan amount, Respondent No,2/Defendant No,3, created an equitable mortgage by depositing the title deed and other related documents. The Appellant failed to liquidate their liability despite number of reminders for repayment of outstanding amount were issued to them by the Respondent Bank and consequently the Respondent Bank filed the above said suit.
3. After service of summons, the Appellants filed application under section 10 of the 2001 Ordinance, (the "PLA") In the PLA application, the Appellants raised certain preliminary objections regarding maintainability of suit; authenticity and genuineness of the execution of the documents and further that the plaint does not fulfill the requirements of section 9(2) and (3) of the 2001 Ordinance. The Appellants further alleged in the application that the Respondents, are charging exaggerated mark up, penal charges, etc. In violation of the agreement which is not permissible under the law; that the mark-up which has been debited in the statement of account beyond the contractual period and the statement of account does not draw the true and faithful picture of the transaction.
' The Appellants/Defendants further stated that they obtained finance facility by securing their properties to promote their business but due to serious crisis and hardships due to price escalation in oil, gas, raw material hampered and routed the business.
4. The Defendant No,3/Respondent No,2 by way of his separate leave application admitted that he offered his property against the facility availed by Appellants and that after re-payment of the liability, the Defendant No,3/Respondent No,2 never ever mortgaged his property with the Plaintiff/Respondent Bank; that the suit of the Plaintiff Bank is without proof disbursement; that the entries of statement of account are ambiguous and dubious; that the Appellants mortgaged his property against the Running finance Facility availed and disbursed the year 2008. However, he denied the availing of the facility under the re-structuring of the finance and vehemently denied as to any document was mortgaged in pursuance to the aforesaid restructured facility. Consequently, vide order dated 7.2.2011, the suit was decreed vide judgment and decree dated 7.2.2011 entitling the Respondent Bank in the sum of Rs,2,83,93,998/- with costs of funds from the date of default i,e, 1/4/2009 and costs of suit under sections 3 and 17 of the 2001 Ordinance.
5. Feeling aggrieved, the said-order was assailed before the Hon'ble Court in R.F.A. No,470/2011, which was allowed vide order dated 12.4.2012 and impugned judgment and decree was set aside and the case was remanded to the learned trial court with a direction to the learned trial court to decide the case within a period of six months. Subsequently, the learned trial court on post remand proceedings framed as many as eight issues, recorded evidence of the Respondent Bank closing the right of the Appellants to produce evidence and proceeded to decree the suit of the Respondent Bank vide judgment and decree dated 20.5.2013 in the terms mentioned in the said judgment and decree which has been impugned and assailed through this appeal.
6. Learned counsel for the Appellant has argued that on 20.5.2013 vide the impugned judgment and decree, the learned trial court without granting last opportunity closed the right of evidence of the Appellants, while the Plaintiff Bank was granted certain opportunities for production of evidence; that the Plaintiff Bank produced only one witness Mr. Tanveer Ahmad, Manager SAM, who produced the documents, but was not the witness of those documents nor he was authorized on behalf of Bank to record his evidence which is also very clear from his statement; that the Appellants specifically denied the execution of alleged renewal facility in paras-9 to 11 on merit but the learned trial court in the impugned judgment and decree stated that the Appellants/Defendants have admitted the execution of loan documents that the impugned judgment and decree has been passed contrary to the finding of Hon'ble Lahore High Court, Lahore, whereby the case was remanded. The counsel of the appellant brought to our knowledge the order dated 15.5.2013 of the Banking Court, the relevant extract from that order is reproduced hereunder:- "In view of the decision passed by the Hon'ble High Court, Lahore the learned predecessor of this Court proceeded to frame issues directing both the parties to lead evidence in respect of their versions and contentions. The evidence on behalf of the plaintiff was recorded which was cross- examined by the counsel representing the Defendants Nos. 1 and 2, the counsel for the defendant No,3 moved another application under Order XIV, Rule 5 for recasting and for amendment in issues which was declined keeping in view the fact that the instant suit filed by the Banking Company under a special Ordinance. The Courts are generally discouraged and restrained the parties to move frivolous applications which was declined vide this Court order dated 02.05.2013 directing the defendants to cross-examine the witnesses. Needless to mention that despite availing various opportunities they have failed to file the same. The right of cross-examination is therefore, closed."
' The counsel for the appellant has further argued that the Banking Court in para-8 of the impugned judgment has observed as under:- "The plaintiff has concluded his entire evidence and on 20.02.2013, the case was fixed for cross- examination. Needless to mention that the defendants availed four opportunities. Except the defendants Nos. 1 and 2, the defendant No,3 has miserably failed to cross-examine the witnesses, his right of cross-examination despite availing further four opportunities was not concluded and finally his right of cross-examination was closed. The case was fixed for the evidence of the defendant specifically keeping in view the spirit of the order passed by the Hon'ble High Court, Lahore; the defendants Nos. ], 2 and 3 were specifically directed to produce the evidence. The counsel for the defendants Nos.1 and 2 appeared and lately disappeared whereas the clerk for the counsel for the defendant also appeared who was specifically directed to produce the evidence but they have miserably failed to produce the evidence and consequently their right of producing the evidence was closed while following the wisdom of Order XVII, Rule 3."
7. On the other hand, the learned counsel for the Respondent has supported the impugned judgment and decree and prayed for dismissal of the appeal in hand.
S. The arguments of counsel for the parties have been heard and record of Banking Court has been perused which has been appended with this appeal.
9. We have gone through the entire record and found that in this court the Hon'ble Division Bench of this Court in R.F.A. No,470/2011 vide order dated 12.04.2012, while remanding the case, had passed a direction to the Banking Court to decide the case after framing the issues and recording the evidence. In the remand proceedings, the issues were framed and the case was fixed for recording of the evidence and examining the record.
10. It transpires from perusal of record that the Banking Court vide order dated 20.5.2013 only provided one opportunity to the Appellants before closing their right under Order XVII, Rule 3 Code of Civil Procedure, 1908 ("C.P.C."). The only issue before us, raised by the Appellants is that whether the Banking Court was justified in closing the right of evidence despite of the fact that the case was remanded for the framing of issues and recording of evidence under section 10(11) of 2001 Ordinance.
11. In this case, it transpires that the evidence of the Plaintiff Bank was recorded on 15.5.2013 and the court closed the right of cross-examination of the Respondent No,2/defendant No,3 by adjourning the case for producing evidence for 20.05.2013 and thereafter passed the impugned judgment and decree without providing the Appellants Nos.1 and 2/Defendants Nos.1 and 2 and Respondent No,2/Defendant No,3's right to produce evidence.
12. In plethora of judgments, the Hon'ble Supreme Court of Pakistan has held that right to close the evidence under Order XVII, Rule 3, C.P.C. Shall not be exercised unless various opportunities have been granted to the parties, who failed to produce evidence. Reliance in this respect is placed upon Sheikh Khurshid Mehboob Alam v. Mirza Hashim Baig 2012 SCM R 361, Zahoor Ahmed v. Mehra, 1999 SCM R 105; Muhammad Arshad Muhammad v. Jahanzeb Khan, 2008 SCM R 1335.
13. In a similar proposition of closing the right of evidence, the Division Bench of this Court in Momin Mansib Bokhari v. Habib Bank Limited, 2005 CLD 923 held that: To our mind, if the learned Judge Banking Court was to record the evidence, then it ought to have, firstly, passed the ex parte order, against the appellants, and thereafter to record Bank's evidence either on the same day or on the succeeding date. Thus the learned Judge Banking Court committed legal error, while recording Bank's evidence, without proceeding ex parte against the appellants. Furthermore the learned Banking Court, after recording evidence of the plaintiff did not fix the case for recording evidence of the appellants and straight away fixed the case for hearing ex parte arguments of the respondent-Bank. When no ex pane order was passed against the appellants, then the learned Judge Banking Court was under an obligation to provide them an opportunity to produce their evidence. We feel that the consequence, of not passing the ex parte order against the appellants on 10-6-1999, was that the appellants were very much in the field and so long as ex parte order was not passed against them, they were entitled to cross-examine P. W.I and to lead their affirmative/rebuttal evidence, which right was unlawfully denied to them.
Had the appellants been proceeded ex parte on 10-6-1999, in that case, the order for the fixation of the ex parte arguments would have been proper and legal. Under the present set of circumstances, the learned Banking Court should have at least, provided one opportunity to the defendants for producing their witnesses. In the above perspective, we are of the view that the learned Banking Court, while passing the impugned decree has committed legal errors, inasmuch as the appellants have been condemned unheard. The impugned judgment suffers from legal errors/defects, therefore, we are inclined to the set the same aside.
14. Similarly, in Ally Brothers and Company v. Federation of Pakistan, 2009 YLR 982, the Lahore High in the order passed by Mian Saqib Nisar, J held that impugned order to close the right to cross- examine has been passed in, undue haste, which obviously has violated ' and curtailed the petitioner's most valuable right of cross-examination therefore, such order cannot sustain. Reliance is placed on Kashif Ali Khan and another v. Sher Jan Muhammad and another, 2006 M LD 1447 and Lyallpur Cotton Mills v. Authority under Payment of Wages. Act, Faisalabad, 1985 PLC 569.
15. From the perusal of above mentioned case laws, it transpire that one opportunity was granted to the Appellants in the suit but they failed to produce their evidence and therefore their right to produce evidence was closed. The Banking Court passed the impugned judgment in haste and the Appellants have been knocked out on hyper-technical ground.
16. It is to be noted that the suit was remanded by this Court to the Banking Court to decide the same on merits. The section 10(11) of the 2001 Ordinance clearly states that when PLA is accepted, the Banking Court shall treat the application as a written statement, and in its order shall frame issues and fix a date for recording of evidence thereon and disposal of the suit. Since issues were framed and it was fixed for cross-examination and the evidence of the Appellants, when the Impugned Judgment and decree Was passed. The Courts have held that once leave is granted, the Banking Court shall decide the case after the recording of the evidence of all the parties on all the issues framed therein. The 2001 Ordinance is a special law and the Banking Court had to follow the strict requirement of section 10(11) of the 2001 Ordinance for deciding the suit, once the leave is granted after the complete evidence is recorded.
17. After hearing the learned counsel for the parties, we have noticed that the Banking Court has committed material irregularity in not giving sufficient time to the Appellants to produce their evidence on time. The instant appeal is allowed, impugned judgment and decree is set aside and the case is remanded to the Banking Court-IV, Lahore in order to give the Appellants one more opportunity to produce their evidence. The parties are directed to appear before the Banking Court on 23.12.2016 and the record of the case shall also be sent back. revisions by the competent authorities. Therefore, it is advisable to consult the official sources or legal professionals for the most up-to-date and accurate information.