SHAHID KARIM, J. --- PLA No, 503-B of 2015. This order will decide PLA 503-B-2015, which has been filed on behalf of the defendants.
2. According to the plaint, the commercial relationship between the parties was established in the year 2010 and has continued since then. The defendant No, 1 Nawa Media Corporation (Pvt.) Ltd.
("the Company") approached the plaintiff-Bank _for certain financial facilities vide letter dated 26.02.2010. This request was acceded to and facility offer letter dated 20.08.2010 was issued by which the Company was allowed Letter of Credit (LC) facility for Rs,10 Million and a facility of Finance against Imported Merchandise (FIM) for Rs,10 Million. Through a facility offer letter dated 23.09.2010, the Company was also granted Demand Finance Facility (DFF) for Rs, 15 Million (for five years) and Running Finance Facility (RFF) for Rs, 30 Million (for one year). The agreements and other relevant documents were executed between the parties in order to formalize the financial relationship between the plaintiff-Bank and the Company and other defendants. These documents have been attached with the plaint. The agreement regarding DF facility is dated 24.2.2011 and for Running Finance facility which was executed on 24.02.2011 as well. Vide board resolution dated 17.2.2011 the defendant No, 2 was authorized to negotiate renewal of the existing facilities. Through a facility offer letter dated 21.11.2011 the Running Finance facility for Rs, 30 Million was renewed (with expiry on 31.10.2012), facility of FIM was enhanced to Rs, 20 Million and LC facility was also enhanced to Rs, 20 Million. Once again, the parties executed various agreements and other security documents dated 01.10.2011. The directors/defendants also executed personal guarantees in favour of the plaintiff-Bank.
3. The Company at a later stage requested the plaintiff-Bank for issuance of an NOC in favour of Silk Bank for creation of Pari-Passu charge of Rs, 13.5 Million and while doing so acknowledged the financial obligations in favour of the plaintiff Bank. As per the statement in terms of Section 9(3) set of the Financial Institutions (Recovery of Finances) Ordinance, 2001 the particulars of the amounts availed, the amounts paid and the amounts outstanding has been given in paragraph 12 of the plaint, according to which cumulatively the defendants owe an amount of Rs, 102,237,279.55 to the plaintiff-Bank. According to the plaint, the Company availed the facilities granted to it and while it undertook to discharge its obligations, failed to do so and hence the necessity for filing of the instant suit. The defendants have filed application for leave to defend and in that application have sought to raise substantial questions of law and fact which shall be dealt with in seriatim in the following paragraphs.
4. It was contended by the learned counsel for the defendants that the defendants that there is no document which would purport to be a personal guarantee executed by the defendant No,
4. This contention is at once rebutted by reference to pages 63 and 72 which are personal guarantees executed by the defendant No, 4 on 24.02.2011, the first being in respect of DFF and the second being in respect of REF to coincide with the first agreement and, therefore, it cannot be said that the plaint is not accompanied by the documents of personal guarantees executed by the defendant No,
4. In the same vein, the learned counsel stated that the suit has become barred by time as against defendants No, 2 and 3. While elaborating, he stated that guarantees by defendant No, 2 were executed on 24.2.2011 and 01.10.2011 (pages 105, 61 and 70) and in respect of defendant No, 3 it was executed on 01 10.2011.
The suit was filed on 22.9.2015 and therefore, the suit has been filed beyond the period of three years prescribed. However, it is a rule settled by respectable authority according to which the limitation starts to run from the demand made and not from the execution of the documents. It is not denied that if this be the rule, then the suit is within time of the demand having been made by the plaintiff. If any authority is required, reliance can be placed on Tariq Shahbaz Chaudhry and 5 others v. Bank of Punjab through Attorney and 4 others (2004 CLD 207), a Division Bench judgment of this Court. Further, by its very terms, the guarantees executed by the defendants are continuing in nature and remain operative and valid until all moneys and liabilities due from or incurred by the customer shall have been paid or discharged (clause 12). Also the guarantee shall continue to remain binding until receipt by the plaintiff of written notice of discontinuance and it is not the defendants' case that any such notice was served on the plaintiff. More importantly, the repayment had to be made by the defendants within two days from demand and no document has been produced to show that a demand was raised and the suit runs three years beyond that demand.
5. By reference to a condition in the facility offer letter dated 21.11.2011, the learned counsel stated that there was no requirement for defendant No, 4 to have executed personal guarantee. However, this is since the fact remains that defendant No, 4 indeed executed a personal guarantee and any clause in the facility offer letter does not prohibit its execution.
6. The learned counsel for the applicant next took exception to the sufficiency in law of the statement of account attached in support of the plaint. According to him, the statement of account has been signed by a Vice-President and does not accord with the Bankers' Books Evidence Act and, therefore, cannot be relied upon. More so, it has been printed on a white paper and no decree can be passed on its basis. Firstly, the verification has been done by the Vice- President of the plaintiff-Bank but it has also been mentioned that he was the manager of the branch as well and this is in compliance of the provisions of the Ordinance, 2001. It has also been held in Mst. Tasleem Fatima and others v. Bank of Punjab and others (2017 CLD 552) that computer generated statement of account does not require any verification or certification and it is otiose to assert that they comply with these two conditions. Be that as it may, the learned counsel for the plaintiff-Bank referred to certain portions of the application for leave to defend, according to which the defendants admit to having made repayment of the principal amount although according to the defendants the said amount was illegally adjusted against mark up. For the purpose, reference may be made to the following paragraphs:--- "That it is pertinent to mention here that the instant suit is an illegal and vile attempt by the plaintiff-Bank to over look its own misdeeds, illegalities and breaches of its contractual obligations. It is worth noting here that the business relationship between the parties started since year 2010 when in February 2010, the plaintiff-Bank agreed to provide requisite finance facilities to the defendant No, 1 Company. However, right from the beginning, the plaintiff-Bank failed to honor its commitments. It may respectfully be submitted here that the plaintiff-Bank obtained request letter from the defendant No, 1 on 26.02.2010 but inordinately delayed the process and issued facility offer letter on 20.08.2010 i,e, about six months delay. Even thereafter further delayed issuance and execution of finance documents which were finally executed on 24.02.2011 i,e, about a year after request letter. Even in terms of facility offer letter mala fidely did not get any valuations and thus constrained the provision of facility amounts to the extent of Rs, 15 M towards DF and Rs, 10 M towards RF facilities. Even thereafter arbitrarily renewed the RF prematurely... " "... It was revealed later that the plaintiff-Bank illegally and unjustifiably adjusted huge amounts from the account of the answering defendant No, 1 under the garb of illegal mark-up from the amounts which were actually paid towards the repayment of principal amount, although the same was much in excess to what was actually disbursed to the answering defendants. This illegal charging of mark-up was done by the plaintiff-Bank without even intimation, knowledge and approval of the answering defendants in utter disregard to the agreed terms and conditions between the parties and even without any agreement on mark up basis. The plaintiff-Bank has filed the instant suit to cover up its own misdeeds, illegalities rather criminal breach of trust."
7. It is also evident from a reading of the paragraphs above that availing of the facilities has not been denied by the defendants although they take cavil to the conduct of the plaintiff-Bank and delay on its part in the execution of the finance documents and issuance of facility offer letter. The learned counsel for the plaintiff-Bank also pointed out that upon default committed by the the account was shifted to the Special Assets Management Unit of the Bank and this fact is not disputed by the learned counsel for the defendants. The entries in the statement of account are corroborated by the entries in The current account statement of the Company has also by the draw-down notices which are annexed with the plaint at pages 76 to 91 (in respect of DFF) and thus each entry is also corroborated by these notices.
8. The learned counsel next referred to the facility offer letter dated 21.11.2011 and the corresponding agreement at page 100 with the plaint which is dated 01.10.201,1 to contend that the agreement has been executed prior in time to the issuance of the facility offer letter. The plaintiff does not deny this fact and it has been brought forth by the learned counsel that this was done on the request of the defendants as the facility was about to expire and it was necessary for the said facility to be renewed in time. Be that as it may, nothing turns on this aspect since the learned counsel for the defendants admits that the real document is the agreement between the parties and on the basis of which the relationship is to be governed. The agreement dated 01.10.2011 is not denied by the defendants and was executed on the request made by the Company after the resolution of the Board of Directors to make such a request. The learned counsel for the plaintiff-Bank does not deny the fact that the personal guarantee at page 109 and executed by the defendant No, 3 bears the date 7 7.2011' and this, according to him, was a typographical error however, the amount against which the guarantee was issued corroborates to the amount of DF facility and was executed for the purposes of the said facility.
9. As regards FIM facility, the learned counsel for the defendants alleges that no document has been annexed with the plaint. However, the learned counsel for the plaintiff-Bank retorts that this is not the basis of the claim in the suit and thus there was no need to annex the documents relating to this facility.
10.10.Despite the objections raised by the defendants in the application for leave to defend, there is a clear acknowledgement on the part of the defendants to the liabilities which have now been sought to be recovered by the plaintiff-Bank. The first of this acknowledgement is a letter dated 3.11.2011 sent by the defendant No, 3 on behalf of the Company and in which not only an acknowledgment of the liabilities has been made but request has also been made for a further RF facility which was being soughtthrough Silk Bank Limited and for which an NOC was required. On 27.02.2014, another letter was-written in which it has been informed that due to lack of economic growth in the country and cash flow issues being faced by the media industry, the financial situation of the Company was not very good. It was further stated that:-- "As you are aware that owing to an overall lack of economic growth in the country and cash flow issues being faced by the media industry, the financial situation of Nawa Medial Corporation (Pvt.)
Limited is not very good. Even though the management is trying its best to improve the revenues while reducing costs but the company is presently barely able to meet its operational expenses as evident from the financial statements. I am afraid that under the circumstances it will, not be possible to pay any mark-up in the foreseeable future: It is humbly requested that the Bank understands our situation and allows the principal amount to be settled in ninety six (96) equal monthly installments with a grace period of two (2) years."
11.The same was reiterated through letter dated 21.05.2015 in the following words:--- "As you are aware that owing to an overall lack of economic growth in the country and cash flow issues being faced by the media industry, the financial situation of Nawa Medial Corporation (Pvt.)
Limited is not very good. Even though the management is trying its best to improve the revenues while reducing costs but the company is presently barely able to meet its operational expenses as evident from the financial statements. However, things are improving and we are confident that our financial situation should improve further within a year or two. In this background it is humbly requested that the Bank understands our situation and allows the principal amount to be settled in ninety-six (96) equal monthly instalments within a grace period of two (2) years." In case our request is not approved please give us a year to offer better payment - terms as per the company's financial situation."
12.Once again, the acknowledgement of the liabilities has been reflected in the audited balance sheet of the Company which has been attached with the plaint and for which there is no denial.
These documents have not been denied by the defendants and are sufficient to hold-that the defendants as per their own showing are liable for the repayment of the outstanding amounts. The case-law cited by the learned counsel for the defendants is clearly distinguishable and need not be discussed in detail.
13.In view of the above, the defendants have failed to raise any substantial question of law or fact and hence the application for leave to defend is hereby dismissed.
Main Case 14.As a result of the dismissal of the application for leave to defend, the suit is decreed in favour of the plaintiff-Bank and against the defendants jointly and severally for a sum of Rs, 102,237,279.55 with costs of funds in terms of section 3 of the Ordinance, 2001. The costs of the suit are also granted.
15.The decree having been passed, the suit stands converted into execution proceedings. The particulars of the mortgaged, pledged or hypothecated property shall be filed by the decree- holder. Adjourned to 06.11.2017.