QAISER RASHID KHAN, J.---Through the present appeal, the appellants have called in question the judgment and decree dated 2.6.2009 of the learned Judge Banking Court-I, Peshawar whereby the suit of the respondent/plaintiff (bank) was decreed against the appellants/ defendants jointly and severally for a sum of Rs, 88,48,102.34 with costs of funds from the date of default till final recovery along with costs of the suit.
2. Precise facts leading to the instant appeal are that the respondent/plaintiff (bank) filed a recovery suit against the appellants/defendants for a sum of Rs, 10,252,611/- as on 7.8.2003 together with accrued mark-up from 9.8.2003 till final recovery along with 20% liquidated damages and other legal charges before the learned Banking Court-I, Peshawar.
3. On being put to notice, the appellants/defendants came up with their application to defend the suit/written statement raising various legal and factual objections and also admitted their liability to the extent of Rs,26,77,014.26 and accordingly an interim decree for the said amount of Rs,26,77,014.26 was passed in favour of the respondent- bank against the appellants/defendants on 5.10.2004 and for the remaining amount leave was granted to the appellants/ defendants. After framing issues, on the request of the appellants/ defendants an amicus curiae was appointed to determine the controversy in respect of outstanding as well as the mark-up amount who submitted his report which was objected to by both the parties. Thereafter the amicus curiae was examined, both the parties adduced their respective evidence and finally the learned trial court passed the impugned judgment and decree.
4. Learned counsel for the appellants/defendants contended that the learned trial court has not appreciated the record in its true perspective while passing the impugned judgment and decree.
He argued that the statements of account submitted by the respondent/plaintiff suggest that mark-up over mark-up has been levied on the account of the appellant-company in disregard to the circulars of the State Bank of Pakistan resulting in an inflated amount in respect of which the respondent/ plaintiff filed the recovery suit. He contended that the appellants in all earnest and fairness admitted their liability to the extent of Rs,26,77,014.26 and there was neither any justification for the respondent-bank to have claimed the remaining amount nor for that matter the same could be proved before the learned trial court during the course of evidence.
5. The learned counsel for the respondent-bank on his turn defended the impugned judgment and decree of the learned trial court on almost the same grounds as detailed therein.
Arguments heard and available record perused.
6. As the available record unfolds, it all started when the appellant-company applied to the respondent-bank for various fund based and non-fund based facilities on the basis of a resolution of the Board of Directors of the Company dated 28.7.1994 (Ex.PW1/3) whereafter the said facilities were sanctioned through sanction advice and the appellants/defendants executed various security documents in favour of the respondent-bank including demand promissory note (Ex.PW1/7), letter of undertaking and also mortgaged their property (Ex.PW1/4) with the respondent/plaintiff (bank) through creation of first charge on the machinery of the project.
Similarly through letter dated October, 1994 (Ex.PWI/9), a request was made by the appellant- company for Running Finance limit of Rs,2.00 million which was accordingly sanctioned vide Sanction Advice dated November 20, 1994 (Ex.PW1/10) and followed by the execution of Demand Promissory Note (Ex.PW1/11) as well as an undertaking (Ex.PW1/12). Thereafter, on the written request of the Managing Director of the appellant-company (Ex.PW1/14) the limit of Running Finance facility favouring the appellant-company was enhanced from Rs, 2.00 million to 4.500 million vide Sanction Advice dated January 30, 1996 (Ex.PW1/15) with a collateral mortgage of the property (Ex.PW1/16) and such relationship of customer and bank continued smoothly as evident from Sanction Advice dated February 25, 1997 (Ex.PW1/17) whereby the Running Finance facility of the company was renewed/enhanced from Rs,4.500 million to Rs, 5.180 million followed by another letter of request dated 24.11.1997 for renewal of Running Finance facility (Ex.PW1/18) which was acceded to by the respondent-bank vide Sanction Advice dated March 9, 1998 (Ex.PW1/19). The same was, of course, followed by the deed of collateral mortgage (Ex.PW1/21), the Renewal/ Temporary Enhancement of Running Finance from Rs,5.00 million to Rs,6.60 million vide Sanction Advice dated February 02,1999 (Ex.PW1/22), the request of the appellants/defendants for non-fund based facility by way of a bank guarantee favouring M/S PTCL through letter dated 23rd April, 2000 (Ex.PW1/24), the bank's Sanction Advice dated April 10, 2000 (Ex.PWI/25), the request of the appellants/defendants for adjustment of mark-up from RF account vide letter (Ex.PW1/26), the Renewal/ Enhancement of RF limit from Rs,5.00 million to Rs,6.00 million vide Sanction Advice dated January 24, 2001 (Ex.PW1/27), copy of the resolution dated 10.3.2001 (Ex.PW1/29) authorizing Mr. Samiullah Khan to open an account with Khyber Bank The Mall (also known as main branch)
Peshawar and the follow up letter of request dated 14.3.2001 (Ex.PW1/28) of the appellants/ defendants for the transfer of account from Saddar Road Branch Peshawar to Main Branch Peshawar and thereafter started the dealing of the appellant-company with the Main Branch, Mall Road Peshawar. Accordingly another request was placed before the respondent/plaintiff (bank) vide letter dated 18.3.2001 (Ex.PW1/30) for various finance facilities followed by a Sanction Advice dated October 30, 2001 (Ex.PW1/33) whereby the Running Finance facility was renewed/enhanced from Rs,6.00 million to Rs,10.00 million together with non-fund based facility and accordingly execution of agreement for financing/IB-6 (Ex.PW1/34) showing the sale price as Rs,10.00 million and the purchase price/mark-up price as Rs,26,128,750/- as well as an agreement for financing/IB- 6 (Ex.PWI/35) for non-fund based facility. In order to further secure the finance facilities on the basis of the said sanction advice, an Additional Mortgage Deed (Ex.PW1/36), Deed of irrevocable General Power of Attorney (Ex.PW1/37) and Memorandum of Deposit of Title Deeds (Ex.PW1/38) were executed in favour of the respondent-bank. The appellants also executed their personal guarantees (Ex.PW1/43 to Ex.PW1/46) undertaking therein to pay all the liabilities of the respondent7plaintiff (bank) in the event of default on the part of the appellant-company.
Promissory Notes (Ex. PW1/47) and (Ex. PW1/48) were also executed in favour of the respondent- bank.
After completion of the desired requirements, vide letter dated 20.12.2001 (Ex.PW1/51) a request was made to the respondent/plaintiff (bank) for the release of Rs,1.2 million from RF limit of Rs,10 million on urgent basis.
7. It needs no reiteration that bank is an institution which deals in the money of other people and thus thrives on the deposit of money by one set of persons and advancing the same to others. In the same manner, relations between the appellant-company and the respondent-bank went on for years as reflected from the various documents exhibited during the course of evidence till the appellants defaulted in the payment of the outstanding amount and that is how the respondent- bank approached the learned Banking Court through a recovery suit supported by the said documents and the statements of accounts (Ex.PW1/62 to Ex.PW1/67) duly certified under sanction 4 of the Bankers' Books Evidence Act 1891.
8. At this stage, it would be more apt to reproduce subsection (3) of section 9 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 as under: "(3) The plaint, in the case of a suit for recovery instituted by a financial institution, shall specifically state--
(a) the amount of finance availed by the defendant from the financial institution;
(b) the amounts paid by the defendant to the financial institution and the dates of payment; and
(c) the amount of finance and other amounts relating to the finance payable by the defendant to the financial institution upto the date of institution of the suit."
Similarly section 10 of the Ordinance ibid provides for leave to defend application by the defendant before a Banking Court. Relevant subsections (3) to (6) read as below: "(3) The application for leave to defend shall be in the form of a written statement, and shall contain a summary of the substantial questions of law as well as fact in respect of which, in the opinion of the defendant, evidence needs to be recorded.
(4) In the case of a suit for recovery instituted by a financial institution the application for leave to defend shall also specifically state the following: (a)the amount of finance availed by the defendant from the financial institution; the amounts paid by the defendant to the financial institution and the dates of payments; (b)the amount of finance and other amounts relating to the finance payable by the defendant to the financial institution upto the date of institution of the suit; (c)the amounts of finance and other amounts relating to the finance payable by the defendant to the financial institution upto the date of institution of the suit; (d)the amount if any which the defendant disputes as payable to the financial institution and facts in support thereof; Explanation:- For the purposes of clause (b) any payment made to a financial institution by a customer in respect of a finance shall be appropriated first against other amounts relating to the finance and the balance, if any, against the principal amount of the finance.
(5) The application for leave to defend shall be accompanied by all the documents which, in the opinion of the defendant, support the substantial questions of law or fact raised by him.
(6) An application for leave to defend which does not comply with the requirements of subsections (3), (4) where applicable and (5) shall be rejected, unless the defendant discloses therein sufficient cause for his inability to comply with any such requirement."
9. Since the respondent/plaintiff (bank) has admitted in para 6 of the plaint that the appellants/defendants have adjusted their liabilities to the extent of non-fund based facilities, therefore, the controversy between the parties boils down to Running Finance facility and the dues outstanding on account of such facility availed of by the appellants/ defendants.
10.In the present case, the respondent/ plaintiff (bank) in para 14 of the plaint has discussed all the details pertaining to the payments made by the bank to the appellant-company in its Running Finance account, the amount paid by the appellants/defendants to the respondent/ plaintiff
(bank) in the said account and the outstanding amount under the Running Finance facility.
Instead, the appellant-company failed to comply with the mandatory provisions of subsection (4) of section 10 of the Ordinance ibid thus involving penal consequences of subsection (6) of section 10.
11.It goes without saying that leave to defend application is not about mere denial of the claim of the respondent/plaintiff (bank) by raising routine and perfunctory objections vis--vis the non- disbursement of the finances and allegations of mark-up over mark-up in the statements of account but such accrual of excessive mark-up, if so resulted, shall be clearly pin-pointed and identified.
12.This court cannot lose sight of the fact that the appellant-company through its years long dealing with the respondent/plaintiff (bank), as per routine banking practice, must have been in receipt of statements of accounts from time to time showing various debit and credit entries but never for once did it agitate the same with the bank through any letter or complaint (at least neither the same has been pleaded in the leave to defend application nor any documentary evidence brought on record during the course of trial), meaning thereby that they were duly satisfied with such statements of accounts and that is how they kept on requesting the bank for renewal/enhancement of the Running Finance facility for a good number of years.
13.After the interim decree for Rs,26,77,014.26 (on the admission of the appellant-company) was passed in favour of the respondent/ plaintiff (bank), leave to defend was granted to the appellants/defendants and accordingly nine issues were framed. As evident from the order sheet dated 18.5.2005, it was in order to resolve the controversy between the parties regarding the exact amount disbursed to the appellants/ defendants and the mark-up over mark-up, if any, levied by the respondent/plaintiff (bank) when on the request of the appellants/ defendants, an amicus curiae was appointed and on his failure to submit the report, another amicus curiae, a serving AVP of Habib Bank Limited, was nominated to do the needful who painstakingly went through the concerned record and finally came up with his report to the effect that the Running Finance facility remained sanctioned for 2883 days and that by his expert estimate, an amount of Rs .88,48,102.34 of the respondent/plaintiff (bank) stood outstanding against the appellants/ defendants. Given the objections over the report of the amicus curiae, he was cross-examined by the appellants/defendants and thereafter an opportunity was even afforded to the parties to come along with their respective evidence.
14. Since the non-fund based facilities as per the respondent/plaintiff stood adjusted at the time of filing of the recovery suit, therefore, the said subject does not warrant any discussion.
15.During the course of arguments before the court, when the learned counsel for the appellants was questioned to pinpoint any misreading or non-reading of evidence in the impugned judgment and decree of the learned trial court or for that matter any illegality in the report of the amicus curiae which formed the basis of the impugned findings, the learned counsel could not point out the same.
16.The upshot of the above discussion is that the learned trial court through a well reasoned judgment has rightly passed the impugned judgment and decree to which no exception can be taken through the present appeal.
Resultantly, this appeal being without substance stands dismissed with no order as to costs.