MUHAMMAD SHOAIB ARSHAD & another vs FEDERATION OF PAKISTAN through Secretary, Ministry of Law, Justice, Human Rights and Parliamentary Affairs and 4 others

ASIM HAFEEZ, J. This judgment shall also decide connected Constitutional Petitions, numbered as W.P.

No.36674/2016, 37982/2016, 35828/2016, W.P.No.9755/2017, W.P.No.205245/2018, 205248/2018, 205252/2018 & W.P.No.51994/2019, wherein declaration has been sought against existing section 15 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 (hereinafter to be referred as the "Ordinance, 2001"), on the premise of being ultra vires and unconstitutional. These petitions were heard by various Single Bench(s) before a larger Bench was constituted, pursuant to order dated 26.04.2019, in view of decision in the case of "MUHAMMAD UMER RATHORE v . FEDERA TION OF P AKIST AN" ( 2009 CLD 257 ).

2. It is essential to give a brief historical perspective to understand controversy raised through these petitions.

Existing section 15 of the Ordinance, 2001 (referred to as "re-enacted section 15") was re-introduced on 12.08.2016 through Financial Institutions (Recovery of Finances) Amendment Act,(XXXVIII of 2016) (hereinafter to be referred as "Amendment Act, 2016" ), as earlier section 15 of Ordinance, 2001 (referred to as "original section 15") was declared unconstitutional by Honourable Supreme Court of Pakistan in the case of "NATIONAL BANK OF PAKIST AN and 117 others v. SAF TEXTILES MILLS LIMITED" (PLD 2014 SC 283), which decision, inter alia also put to rest conflicting views regarding validity of original section 15 [which was held intra vires by learned Division Bench of Hon'ble Baluchistan High Court in the case of Sh. ABDUL SATTAR LASI v.

FEDERA TION OF PAKIST AN through Secretary , Ministry of Law, Justice and Parliamentary Affairs, Islamabad and 6 others (2006 CLD 18), and ultra vires and unconstitutional by learned Full bench of Hon'ble Lahore High Court in the case of MUHAMMAD UMER RATHORE v. FEDERA TION OF PAKIST AN (2009 CLD 257). The legislature re-enacted section 15 with modifications. The causes of action arose to the petitioners when demand notices were issued by the financial institutions under re-enacted section 15, demanding payment of outstanding mortgage money . The facts of each petition may be different, but grounds of challenge are common, i.e. wherein constitutionality of re-enacted section 15 is questioned. Notices under Order XXVII-A of the Code of Civil Procedure, 1908 ('the Code'), were issued to the Attorney General for Pakistan. State Bank of Pakistan was impleaded as respondent No.4 and is duly represented. It is notable that Federal Government, in exercise of powers under section 25 of the Ordinance, 2001, enforced rules through Financial Institutions (Recovery of Finances) Rules, 2018 [published on 27.08.2018] [hereinafter to be referred as Rules, 2018], objective whereof was to supplement the procedures regarding mode, conduct, method of public auction and provide additional checks on the financial institutions. The vires of the Rules, 2018 were also assailed through application bearing C.M. No.04 of 2019, which was allowed vide order dated 01.10.2019, wherein additional grounds were pleaded.

Submissions by the Petitioner 's counsel.

3. Learned counsel submits that re-enact ed section 15 offends / nullify pronouncement by Apex Court in the case of SAF Textiles Mills Limited (supra) , which objective cannot be achieved through purported exercise of legislative authority . Learned counsel referred to the case of "FECT O BELARUS TRACT OR LTD. v. GOVERNMENT OF PAKIST AN through Finance Economic Affairs and others" (PLD 2005 SC 605) and "Dr. MUBASHIR HASSAN and others v. FEDERA TION OF PAKIST AN and others" (PLD 2010 SC 265). Per learned counsel, sub-section

(17) of section 15 of the Ordinance, 2001, is contrary to the mandate of Article 189 of the Constitution of the Islamic Republic of Pakistan, 1973 ("Constitution, 1973). Further submits that arming Financial Institutions with arbitrary powers to proceed with the sale of the mortgaged property without seeking adjudication of claims through judicial process is violative of Article 10-A of the Constitution, 1973. Adds that re-enacted section 15 is otherwise, discriminatory provision of law, when the remedy for determination of financial claims already exists under section 9 of the Ordinance, 2001. Re-enacted section 15 extends arbitrary powers to the financial institutions and deprive the mortgagors of variously available rights and remedies, which are available under existing section 9 of the Ordinance, 2001, and provides for judicial determination of claims, fair and transpar ent process for the enforcement of determined amounts and sales, under the supervision, and subject to confirmation by the Banking Courts. Per learned counsel, initiation of recovery process before determination of default of the customer , is like putting a cart before the horse. Submits that conferrin g of adjudicatory powers unto financial institutions violates mandate of Article 175(2) of Constitution of 1973, reference is made to the case of "MEHRAM ALI and others v.

FEDERA TION OF PAKIST AN and others" (PLD 1998 SC 1445 ). Learned counsel submits that re-enacted section 15 would render section 9, ibid, redundant, ineffective and least choice of the Bank Managers. Adds that re- enacted section 15 is not only ex-facie discriminatory , but capable of being employed in discriminatory manner , at the whims and choice of the Bank Managers, who would invoke re-enacted section 15 against hand-picked mortgagors, eyeing their coveted assets. Learned counsel referred to the case of "WARIS MEAH v. (1) THE STATE (2) THE STATE BANK OF PAKIST AN AND NOOR MUHAMMAD v. (1) THE STATE (2) THE STATE BANK OF PAKIST AN" (PLD 1957 SC (Pak.) 157) and "Sued MUSHAHID SHAH and others v. FEDERAL INVESTMENT AGENCY and others" ( 2017 SCMR 1218 ).

4. Learned counsel emphasized that unfettered and unstructured discretion extended to financial institutions, without predetermined criterion, would result in exploitation of mortgagors and expropriation of properties. And no real / effective protection has been afforded against arbitrary exercise of powers under re-enacted section 15.

Submits that there is no safeguard available against demands of exaggerated and unrealistic claims, unilateral determination of defaults and hasty , collusive, and pre-arranged sales. Per learned counsel, execution of sale deed, as a result of manipulative sale, would extinguish proprietary rights in the property , notwithstanding pendency of objections. The practice of effecting recoveries of self-determined claims / liabilities without the adjudicatory process was disapproved in the cases of "AGRICUL TURAL DEVELOPMENT BANK OF PAKIST AN v. SANA ULLAH KHAN and others" (PLD 1988 SC 67) and "AGRICUL TURAL DEVELOPMENT BANK OF PAKIST AN and others v. ABID AKHT AR and others" (2003 SCMR 1547 ). Submits that re-enacted section 15 suffers from inherent defects as the financial institut ion cannot be the judge of its own cause; when it is empowered to determine and declare defaults; conduct auction of mortgaged properties; participates in the bidding process and entitled to purchase said properties. While questioning the process of mode, method and conduct of auction sale, learned counsel submits that mechanism provided for procuring valuation of mortgaged property , is prejudicial, mere eye-wash and classic instance of conflict of interest, where financial institutions, at their sole discretion, would appoint valuators, procure valuation of the mortgaged property and thereafter purchase properties on the basis of said valuations. Adds that it would encourage collusive and illegal sales, to the prejudice of the mortgagors. The expression "reputable" is unclear , vague and left to the imagination of bank Managers. He referred to various conflicting valuations reports carried by various Pakistan Banks Association, approved evaluators, showing irreconcilable determinations qua the value of similar properties. He adds that under the provisions of Order XXI Rule 66, of the Code of Civil Procedure, 1908 ("The Code") - applicable to the execution proceedings before the Banking Courts - power to fix reserve price was extended to the Court and objections can be filed to question reserve price fixed. Learned counsel made reference to clause (d) of sub-section (4) of section 15 and submits that public auction can be conducted merely after lapse of three business days from the date of the publication, which time frame allowed - between the publication of notice and conduct of auction sale - is unreasonable and unlawful.

5. Learned counsel questions the validity of the Rules, 2018, and submits that same exceeds the scope of parent enactment. The power to seek determin ation of outstanding mortgage money through Chartered Accountants, tantamount to conferring judicial authority on them, without any remedy to disput e such determinations. Submits that Chartered Accountants would also determine penalties, as definition of "mortgage money" included penalties, damages, charges or pecuniary liabilities. With respect to the facts of instant petition, submits that once financial institution has opted to invoke remedy under section 9 of the Ordinance, 2001 and instituted civil action, any notice under re-enacted section 15 would tantamount to undermine judicial authority vested in the Banking Courts, which course of action otherwise if allowed would render section 9 superfluous, redundant and ineffective. Adds that once it is acknowledged by the financial institution that default in the performance of an obligation requires judicial determination, retracing of steps would prejudice the rights of the customers / mortgagors and enable financial institutions to avert scrutiny of pending claims, which would in fact fructify pending petitions for leave to defend.

Lastly submits that re-enacted section 15 failed to meet the qualifications prescribed in the case of "SAF Textile Mills Ltd." (supra). In support of the submissions, reliance is placed on following cases, reported as "SAUDI-P AK INDUSTRIAL AND AGRICUL TURAL INVESTMENT COMP ANY (PVT .) LTD., ISLAMABAD v. Messrs ALLIED BANK OF PAKIST AN and another" (2003 CLD 596), "MUHAMMAD MUBEEN-US-SALAM and others v.

FEDERA TION OF PAKIST AN through Secretary , Ministry of Defence and others" (PLD 2006 SC 602), "BAZ MUHAMMAD KAKAR and others v. FEDERA TION OF PAKIST AN through Ministry of Law and Justice and others" (PLD 2012 SC 923), "CONTEMPT PROCEEDINGS AGAINST CHIEF SECRET ARY, SINDH AND OTHERS" (2013 SCMR 1752 ), "SHADMAN ELECTRONICS INDUSTR Y PVT. LIMITED and 2 others v. NIB BANK LIMITED through Authorized Attorney" (2013 CLD 1305 ), "NATIONAL BANK OF PAKIST AN and 117 others v. SAF TEXTILE MILLS LTD. and another" (PLD 2014 SC 283), "JEHANGIR MEHMOOD CHEEMA v.

GOVERNMENT OF PAKIST AN, MINISTR Y OF INTERIOR through Secretary and 2 others" (PLD 2015 Lahore 301), "MUHAMMAD FAROOQ AZAM v. BANK AL-F ALAH LIMITED and others" (2015 CLD 1439 ), "Messrs SUMMIT BANK LIMITED through Manager v. Messrs QASIM AND CO. through Muhammad Alam and another" ( 2015 SCMR 1341 ), "ZAKARIA GHANI and 4 others v. MUHAMMAD IKHLAQ MEMON and 8 others"

(PLD 2016 SC 229), "JAGUAR PRIV ATE LIMITED and another v. MUSLIM COMMERCIAL BANK LIMITED through Attorney and others" (2016 CLD 2134 ), "SHAHID PERV AIZ v. EJAZ AHMAD and others" (2017 SCMR 206), "MUHAMMAD JAMSHED v. ELECTION APPELLA TE TRIBUNAL and others" (2018 CLC 1330 ), "MUHAMMAD KHALIL v. Messrs FAISAL M.B. CORPORA TION and others" (2019 SCMR 321) and "ABDUL JABBAR SHAHID and others v . NATIONAL BANK OF P AKIST AN and others" ( PLD 2019 Lahore 76 ).

Submissions on behalf of Federal Government.

6. Learned Attorney General indicated that alarming situation created due to phenomenal rise in the volume of non- performing loans and its repercussions on the economy led to the re-enactment of section 15, objective whereof was to address this menace. Submits that growth in the volume of bad debts had resulted into liquidity crunch, where the profitability of the banks has come down, which dissuaded them from offering new loans. He explained that default in the payment of loans constitute squandering of public funds, as the banks used depositor 's money for extending finances. He attributed litigation delays as one of the major contributing factors, and elaborates that intention is to ensure expeditious recovery of overdue amounts from a distinct category of defaulters, i.e. mortgagors, who mortgaged their properties to secure payment of committed mortgage money . He explained that recovery processes under sections 9 and 15 of the Ordinance, 2001, cater for distinct and separate class / category of persons, and re-enacted section 15 exclusively deals with mortgage action(s) against mortgagors for recovery of outstanding mortgage money , secured through specified immovable properties. And in cases where mortgagors have also incurred personal liability - in addition to liability against specified immovable property - the remedy under section 9 of the Ordinance, 2001, can be invoked.

7. Learned Attorney-General submits that re-enacted section 15 was legislated in the context of observations made in the case of "SAF Textile Mills Ltd." (supra), and adequate safeguards and requisite remedies are provided, reinforcing rights of the mortgagors, who may invoke right of redemption and also challenge the conduct of auction sales, in accordance with the remedies provided and conditions prescribed under re-enacted section 15. Learned Attorney-General while elaborating the principles enunciated by the Superior Courts of Pakistan for determining constitutionality or otherwise of a law / enactment, submits that questions regarding the mechanism, mode, procedures and availability or adequacies of remedies do not provide reasons or justifications to hold provisions of law and Rules, 2018 unconstitutional. Referred to the case of "LAHORE DEVELOPMENT AUTHORITY through D.G. and others v. Mst. IMRANA TIWANA and others" (2015 SCMR 1739 ). Further adds that instant petitions primarily question the constitutionality of re-enacted section 15 on the touchstone of fundamental rights, however nothing has been elaborated that how promulgation of re-enacted section 15 has or would infringe fundamental rights, when sufficient remedies are provided to the mortgagor under sub-sectio ns (13) and (14) of re-enacted section 15. Elaborated that, Rules are designed to bring more openness, fairness, transparency to the process and intended to discourage predatory tendencies and vested interests of the Bankers. When asked, learned Attorney- General explained that re-enacted section 15 deals exclusively with the category of mortgagors, either direct recipient of finance facility or those who secured repayment of mortgage money by way of mortgage of properties - which class of persons can be subjected to proceeding under re-enacted section 15. He explained that expression 'customer ' is defined in section 2(c) of the Ordinance, 2001, against whom action can be initiated before the Banking Court under section 9 of the Ordinance, 2001 in cases where there was no mortgage document executed or interest transferred in specified immo vable property . He elaborated that mortgagor is treated as a distinct class/person, which category is distinguishable from customer , due to its peculiar nature. Adds that classification in terms of re-enacted section 15 is based on plausible, reasonable, rational and justifiable differentiation. Learned Attorney-General concluded submissions that no reason or ground is available or pleaded to highlight any violation of Constitutional principles.

Submissions on behalf of State Bank of Pakistan.

8. Learned counsel submits that exceptional situation created, as a consequence of huge unrecovered bad loans, necessitated re-enactment of section 15, giving powers to the financial institutions to seek possession or proceed with the sale of mortgaged property for recovery of outstanding mortgage money, subject to the conditions prescribed. Learned counsel made reference to the Commission constituted by the Honourable Supreme Court of Pakistan regarding bad debts / written-of f loans to emphasize need for special legislation. In the circumstances, remedy was re-introduced through re-enacted section 15, which is a special provision, having an overriding effect when read in juxtaposition to other provisions of Ordinance, 2001, and other applicable laws in terms of sub-section

(17) of re-enacted section 15. Per learned counsel, legislature was competent to re-enact the law, after original section 15 was declared unconstitutional. And once law has been competently made, the Courts can only declare it unconstitutional, if it violates the established Constitutional principles, which princ iples are adequately met when applied in the context of re-enacted section 15. The Courts cannot merely declare law unconstitutional on the ground that it would nullify or render ineffective their judgments. Reliance is placed on "THE STATE v. ZIA-UR- REHMAN" (PLD 1973 SC 49), "Messrs MAMUKANJAN COTT ON FACTORY v. THE PUNJAB PROVINCE AND OTHERS" (PLD 1975 SC 50), "MOLA SSES TRADING & EXPOR T (PVT .) LIMITED v. FEDERA TION OF PAKIST AN and others" (1993 SCMR 1905 ), and "Mehr ZULFIQAR ALI BABU and other s v. GOVERNMENT OF THE PUNJAB and others" ( PLD 1997 SC 1 1).

9. Learned counsel referred to the remedies available in terms of sub-section (12, (13), (14) & (15) of re-enacted section 15 - both prior to the conduct of sale and after auction sale, subject to the conditions prescribed therein.

Adds that remedies are adequate and amply protect the rights of the petitioners, and the conditions cannot be termed as onerous or arbitrary . Learned counsel submits that mortgagee / financia l institution are allowed to bid in auction sales subject to the conditions prescribed, which do not prejudice the rights and remedies of the mortgagors. Reference is made to judgment reported as "MUMT AZ UD DIN FEROZE v. Sheikh IFTIKHAR ADIL and others" (PLD 2009 SC 207). Learned counsel submits that legislature revered the mandate of Article-10-A of the Constitution, 1973, and actions of the financial institution can be brought to the Courts by resorting to the remedies provided. Submits that rights of the mortgagors are further protected through framing of Rules, 2018 - which ensured more transparency , fairness, beefed up checks on the financial institutions and discourage collusive and unscrupulous sales. The Rules, 2018, advance the purpose of the Ordinance, 2001, and re-enacted section

15. Learned counsel made reference to Rule 3(c)(i) of Rules, 2018 to explain that determination of outstanding mortgage money by Chartered Accountants, before initiating process under re-enacted section 15, provides another tier, to ensure that exaggerated and unjustified claims are not raised by the financial institutions, when Chartered Accountants would verify and affirm outstanding mortgage money . Determination of liabilities by Chartered Accountants is not a novel phenomenon, but such mechanism finds reference in various enactments in Pakistan. Learned counsel added that such mechanism is functional worldwide and is successfully employed in Pakistan by the Courts, which had effectively reduced conventional litigation and facilitated quick determination of claims. He referred to the decisions in the cases of "Khawaja MUHAMMAD ASIF v. FEDERA TION OF PAKIST AN and others" (PLD 2014 SC 206) and "ISHAQ KHAN KHAKW ANI and anothe v. RAIL WAY BOARD through Chairman and others" (PLD 2019 SC 602). Learned counsel submits that the Hon'ble Supreme Court had decided the matter and its decision in the case of "SAF Textile Mills Limited" (supra) shall be treated as the law on the subject, and reliance on the case of "Umer Rathore" (supra) is misconceived. Reference is made to the case of "Miss SHAMAILA MAHMOOD v. MUKHT AR AHMAD and 6 others" (1998 PLC (C.S) 51). Counsel reiterated that crucial issue would be that whether deficiencies / shortcomings identified in "SAF Textile Mills Limited case"

(supra) have been addressed. Adds that the observations made against original section 15 are addressed. Learned counsel emphasized that grounds pleaded / submissions raised do not provide any plausible reason to dislodge the presumption of constitutionality . Submits that law should be saved instead of declaring it void, in the absence of violation of Constitutional principles. In support of the submissions, he referred to the cases reported as "(1) THE PROVINCE OF EAST PAKIST AN, (2) THE SUB-DIVISIONAL OFFICER, CHANDPUR, DISTRICT COMILLA, (3)

THE DEPUTY COMMISSIONER, COMILLA AND (4) THE COMMISSIONER, CHIT AGONG v. (1) SIRAJUL HAQ PATWARI AND (2) DILBAR HUSSAIN TALUKDAR" (PLD 1966 SC 854), "Messrs ELAHI COTT ON MILLS LTD. and others v. FEDERA TION OF PAKIST AN through Secretary M/o Finance, Islamabad and 6 others" (PLD 1997 SC 582), "Dr. TARIQ NAWAZ and another v. GOVERNMENT OF PAKIST AN through the Secretary , Ministry of Health, Government of Pakistan, Islamabad and another" (2000 SCMR 1956 ), "Mian ASIF ISLAM v. Mian MOHAMMAD ASIF and others" (PLD 2001 SC 499), "Messrs MASTER FOAM (PVT .) LTD. and 7 others v. GOVERNMENT OF PAKIST AN through Secretary , Ministry of Finan ce and others" (PLD 2005 SC 373), "PAKIST AN LAWYERS FORUM and others v. FEDERA TION OF PAKIST AN and others" (PLD 2005 SC 719), "FEDERA TION OF PAKIST AN through Secretary , Ministry of Finance and others v. Haji MUHAMMAD SADIQ and others" (PLD 2007 SC 133), "Dr. MOBASHIR HASSAN and others v. FEERA TION OF PAKIST AN and others" (PLD 2010 SC 265), "Syed AIZAD HUSSAIN and others v. MOT OR REGISTRA TION AUTHORITY and others" (PLD 2010 SC 983), "Mst. UMMA TULLAH through Attorney v. PROVINCE OF SINDH through Secretary Ministry of Housing and Town Planning, Karachi and 6 others" (PLD 2010 SINDH 236) "ALL PAKIST AN NEWSP APERS SOCIETY and others v. FEDERA TION OF PAKIST AN and others" (PLD 2012 SINDH 129), "Messrs COLONY SUGAR MILLS LTD. through Deputy Manager v. PROVINCE OF PUNJAB and 5 others" (2017 PTD 406) and "Messrs SUI SOTHERN GAS COMP ANY LTD. and others v.

FEDERERA TION OF P AKIST AN and others" ( 2018 SCMR 802 ).

Submissions on behalf counsel for respondents No. 3 & 5.

10. Learned counsel submits that re-enacted section 15 merely provides statutory acknowledgement qua terms of contractual bargain - voluntarily agreed by the parties, whereby the mortgagor has transferred interest in specific immovable property to secure repayment of the mortgage money . The rights of the mortgagee to seek possession and proceed with the sale of mortgaged property are inherently contractual and now statutory acknowledgment is extended through re-enacted section 15, which does not manifest any illegality nor constitute violation of any Constitutional principle.

Further submits that no question of determination of liability arises in the cases of mortgagee' s right to recover amounts, agreed to and specified, at the time of execution of the mortgage document, [either through a deed or Memorandum of deposit of title deed as the case may be]. Submits that mortgagors are estopped to object to the recovery in terms of re-enacted section 15, when they had voluntarily executed mortgage documents and secured repayment of stated amounts. The rights and remedies available to the mortgagor are fully encapsulated and protected under re-enacted section 15, which can be exercised subject to the conditions prescribed. Mortgagor is always entitled to take disputes, if any, regarding sale of property , to the Banking Court in terms of sub-sections (13), (14) & 15 of re-enacted section 15. Learned counsel alluded to contract(s) of Bank guarantee - where an unconditional and irrevocable promises are made to discharge the obligations , which obligations are per-se enforceable and Courts have avoided interference in such commercial matters. Learned counsel referred to chapter VIII of the Contract Act, 1872, to reiterates obligations of the surety toward s the creditor , for and on behalf of the debtor . He also made reference to section 176 of the Contract Act 1872 to underscore the right of the pledgee to sell pledged goods upon default of the pledger , without resorting to the remedy of seeking prior determination of claims. Adds that bargain of mortgage also entails unconditional obligation, enforceable against mortgagors, to pay specified amount - mortgage money - when becomes overdue and payable in accordance with the terms of contract agreed. And claims of such nature do not require prior determination by resorting to adjudicatory process.

11. Learned counsel submits that concept of non-judicial sales is widely recognized in various jurisdictions of the world and even acknowledged under section 40 of the Industrial Development Bank Ordinance, 1961 and section 69 of Transfer of Property Act 1882. He made reference to the case of "(1) OCEAN INDUSTRIES LIMITED, AND

(2) RAZA KAZIM v. INDUSTRIAL DEVELOPMENT BANK" (PLD 1966 SC 738). He also referred to the laws applicable in various jurisdictions, acknowledging rights qua involuntary and non-judicial sales - one of such laws is U.K. Law of Property Act, 1925.

12. Learned counsel submits that no question of discrimination arises with respect to actions taken by the financial institutions, pursuant to the bargain / contractual arrangement, which actions do not attract Article 25 of the Constitution, 1973. He elaborated that there is no cause of discrimination or arbitrary exercise of discretion, when a remedy against mortgagor under section 15 exclusively permits mortgage action for the recovery of outstanding mortgage money . Learned counsel reiterated the objective and purpose of re-enac ted section 15 and emphasized that said purpose and objective must be appreciated while adjudging the constitutionality of said provision of law.

Learned counsel submits that section 19 of Ordinance, 2001 provides for sale of pledged, mortgaged or hypothecated properties without the intervention of the Court, which is reiteration of principle of non-judicial sales.

Learned counsel submits that in case an action is initiated by the financial institution under section 15, the mortgagor has remedy under section 9 and section 15, subject to fulfillment of conditions prescribed in re-enacted section 15. Elaborated that Rules, 2018 framed manifest exercise of authority under section 25 of Ordinance, 2001 and same supplement the spirit and purpose of the Ordinance, 2001, and re-enacted section 15. The mechanism provided to ascertain and determine outstanding mortgage money by engaging Chartered Accountant is neither unconstitutional nor creates parallel mechanism / forum for adjudication of claims or determination of liabilities. No right of the mortgagor is being prejudiced or impaired. Learned counsel submit s that determination of liability , including Costs of Funds by the Chartered Accountant under sub-section (2) of section 3 of the Ordinance, 2001, is permissible, as sub-sections (2) and (3) of section 3 of the Ordinance are independent and each caters for a different situation. The financial/banking services provided by private banks or State-owned / Statutory banks are governed and regulated by contracts, voluntarily entered into and executed by the mortgagors for the purposes of availing finance facilities, or for securing repayments thereof, and any action in respect thereof cannot be termed as state action. Learned counsel made reference to cases of "Luxor (Eastbourne), Limited. & other v. Cooper"

[1941] A.C. 108), "Loose Lodge No.107 v. Irvis Et Al." 407 U.S. 163 (1972) and "Jackson v. Metropolitan Edison Co." (419 U.S. 345 (1974) and "Puravankara Projects Ltd. v. Hotel Venus International, etc." (2007)

10 Supreme Court Cases 33). Learned counsel referred to laws variously applicable in different jurisdiction, allowing non-judicial sales. He relied upon the cases of "FLAGG BROTHERS, INC., ETC., et al., v. BROOKS (1978 Supreme Court 436 U.S. 149), "Margaret A. APAO v. The BANK OF NEW YORK, (1997 97 ARM, U.S. Court of Appeal Ninth Circuit), "COFFEY ENTERPRISES REAL TY & DEVELOPMENT COMP ANY, INC. v.

HOLMES et. Al (Supreme Court of Georgia 233 G9,937; 213 S.E. 2d 882)".

13. Learned counsel submits that case of Waris Meah (supra) is distinguishable as the question therein pertains to the action taken by the State Bank of Pakistan with reference to the offences committed and exercise of unregulated discretion, which led to the declaration of unconstitutionality . Learned counsel submits that Hon'ble Supreme Court of Pakistan while decidin g the case of SAF Textile Mills Limited has not rejected the concept of non-judicial sales, but merely declared original section 15 ultra vires in view of absence of adequate remedies to the mortgagors. Learned counsel placed further reliance on judgments reported as "State of Uttar Pradesh and others v. Babu Ram Upadhya" (AIR 1961 SC 751), "State of T. N. v. M/s Hind Stone etc." (AIR 1981 SC 711), "People' s Union for Democratic Rights and others. v. Union of India and others." (AIR 1982 SC 1473), "PEERLESS GENERAL FINANCE AND INVESTMENT CO. LTD. AND ANOTHER v. RESERVE BANK OF INDIA" (AIR 1992 SC 1033), "People' s Union for Civil Liberties (PUCL) v. Union of India, etc." (AIR 1997 SC 568), "Union of India and others v . Harjeet Singh Sandhu" (AIR 2001 SC 1772).

14. Lastly , learned counsel objects to the maintainability of these petitions in view of the decision in the cases of "M/s ZASHA LIMITED (PUBLIC) LIMITED COMPOANY , LAHORE v. ATRICUL TURAL DEVELOPMENT BANK OF PAKIST AN, ISLAMABAD and 2 others" (PLD 1993 Lahore 914) and "ZARAI TARAQIA TI BANK LIMITED and others v. SAID REHMAN and others" (2013 SCMR 642) and "ABDUL WAHAB and others v. HBL and others" ( 2013 SCMR 1383 ).

Additional submissions on behalf of respondents No.1 & 2 and the counsel for the petitioners.

15. Learned Additional Attorney General explains that remedy of appeal is available under section 22 (6) of Ordinance, 2001, subject to the conditions prescribed therein, and is extended to the orders passed under sub- section (12) of re-enacted section 15 [which conferred jurisdiction on the Banking Courts with regard to all disputes relating to the sale of the mortgaged property]. Adds that the legislature omitted to make requisite amendments in sub-section (6) of section 22 of Ordinance, 2001, wherein sub-section (12) of section 15 has to be read in place of sub-section (11) of original section 15. He referred to the cases reported as "COMMISSIONER OF INCOME TAX v. Messrs ELI LILLY PAKIST AN (PVT .) LTD." (2009 SCMR 1279 ) and "Malik MUZAFF AR AHMED v. MAJLIS-E- ILMI SOCIETY through Muhammad Zubair" (PLD 2016 SC 207) to emphasize that Courts are competent to rectify inadvertent / apparent / obvious mistakes by draftsmen. Submits that subject to the determination of question of constitutionality or otherwise of re-enacted section 15, all other issues raised and argued can competently be raised before the Banking Courts, once proceedings under re-enacted section 15 are initiated.

16. Learned counsel for the petitioners in rebuttal averred that constitutionality of re-enacted section has to be determined in the light of the principles of law, pronounced in the case of Umar Rathore (supra). He vehemently objected to the exercise of legislative authority , purposely intended to nullify the mandate, effect and consequence of the judgment in the case of SAF Textile Mills Limited (supra), which misadventure cannot be saved by seeking refuge behind sub-section (17) of re-enacted section 15.

17. Heard. Available record perused.

18. Fundamentally the challenge raised against presumption of validity of re-enacte d section 15, largely comprised of two major grounds - other grounds may have significance but not relevant for the purposes of reviewing the constitutionality of a legislative instrument or part thereof - which are: a) that re-enacted section 15 had nullified the existence, effect and consequence of judgment of the Hon'ble Supreme Court of Pakistan in the case of SAF Textile Mills Limited (supra) - [challenge posed to the competency of the Legislature to make such a law , having the effect of nullification of the judgment, and; b) that despite textual changes in re-enacted section 15 and framing of Rules, 2018, the newly added section abridges / takes away fundamental rights, enumerated in the Constitution, 1973, per-se discriminatory and capable of being employed in discriminatory fashion [it violates the Constitutional principles and the ratio of decision in the case of SAF Textile Mills Limited (supra)].

19. The precise submission with regard to incompetency of the Legislature is that, through exercise of power to legislate, the Legislature by way of Amendment Act, 2016 -whereby it had re-enacted section 15 - had in fact re- validated original section 15 of Ordinanc e, 2001 and rendered judgment in the case of SAF Textile Mills Limited (supra) ineffective and redundant, which action constitutes encroachment on judicial power and hence, unconstitutional. The petitioners referred to the cases of "Dr. MUBASHIR HASSAN and others (supra) and "FECT O BELARUS TRACT OR LTD. (supra). The judgments referred are distinguishable. In the case of "Dr. MUBAS HIR HASSAN and others (supra) the conviction and sentence were declared void by adding clause (aa) in Section 31-A of the National Accountability Ordinance, 1999. It is expedient to reproduce paragraph 77 of the judgment, which reads as; The examination of the above principle abundantly makes it clear that since the basis of the judgment, in respe ct of conviction in absentia under Section 31A of the NAO, 1999, has not been remo ved, pointing out any defect in the same by the legislature, therefore, the legislature, by means of an enactment, could not give a judgment that conviction in absentia was void ab initio, rather for the purpose of declaring such judgments void ab initio, it was incumbent upon the legislature to have repealed Section 31A of the NAO, 1999 because on the basis of the same the absconder accused were convicted . More so, to nullify the effect of a judgment, by means of a legislative enactment, we have to examine the nature of each judgment separately and individually but in instant case omnibus type order has been passed, declaring all the judgments recorded under Section 31A of the NAO, 1999 as void ab initio, without pointing out any defect in the same.

[Emphasis supplied]

20. It is relevant to reproduce relevant portion of "FECT O BELARUS TRACT ORS LTD. (supra) [wherein reference was made to the case of "MOLASSES TRADING & EXPOR T (PVT .) LIMITED (supra). Relevant portion in the case of "FECT O BELARUS TRACT ORS L TD. is reproduced as; When a legislature intends to validate a tax declared by a Court to be illegally collected under an invalid law, the cause for ineffectiveness or invalidity must be removed before the validation can be said to have taken place effectively . It will not be sufficient merely to pronounce in the statute by means of a non obstante clause that the decision of the Court shall not bind the authorities, because that will amount to reversing a judicial decision rendered in exercise of the judicial power which is not within the domain of the legislature. It is therefore necessary that the conditions on which the decision of the Court intended to be avoided is based, must be altered so fundamentally , that the decision would not any longer be applicable to the altered circumstances.

[Emphasis supplied]

21. The legislature while enacting section 15 - besides providing a non-obstante clause in terms of sub-section

(17) of section 15 - has removed the reasons of ineffectiveness and invalidity , on which basis the original section 15 was declared unconstitutional. In the absence of reasons, the Courts cannot hold or declare unconstitutional, otherwise a valid law, claiming interferenc e in the judicial domain. Reference is made to the ratio of decisions in the cases of "THE STATE v. ZIA-UR-REHMAN and others" (PLD 1973 SC 49) and "MAMUKANJAN COTT ON FACTORY v. THE PUNJAB PROVINCE" (PLD 1975 SC 50), "Mehr ZULFIQAR ALI BABU v. GOVERNMENT OF THE PUNJAB" (PLD 1997 SC 11), and "MOLASSES TRADING & EXPOR T, (supra). Relevant portion in the case of ZULFIQAR ALI BABU (supra) is reproduced hereunder: "15. From the review of the above case-law , it is evident that the Court is not at liberty to inquire into the motives or mala fide on the part of the Legislature. Once a statute is competently made, the Court is not entitled to question the wisdom or fairness of the Legislature. Nor the Court can refuse to enforce a law competently made on the ground that the result would be to nullify its own judgment.

[Emphasis supplied]

22. Now coming to the argument, seeking declaration of invalidity against re-enacted section 15 on the ground that it violates Constitutional Principles and contravenes fundamental rights of the petitioners. It was extensively argued that re-enacted section 15 suffered from same defects as observed in the case of SAF Textile Mills Limited (supra).

The counsels repeatedly referred to and compared original section 15 with re-enacted section 15, to support their respective submissions. It is therefore, expedient to reproduce the sections hereunder for convenience; Sr.

No.New Section 15 After Amendment Act, 2016Old Section 15 Before Amendment Act,

1.

15. Sale of mortgaged property- (1) In this section, unless there is anything repugnant in the subject or context-

(a) "mortgage" means the transfer of an interest in specific immovable property for the purpose of securing the payment of the mortgage money or the performance of an obligation which may give rise to a pecuniary liability;

(a) "mortgage money" means any finance or other amounts relating to a finance, penalties, damages, charges or pecuniary liabilities, payment of which is secured for the time being by the document by which the mortgage is effected or evidence, including any mortgage deed or memorandum of deposit of title deeds;

(a) "mortgage property" means immovable properly mortgaged to a financial institution; and

(a) "reserve price" means forced sale value of the mortgaged property determined by a reputable valuation company under clause (a) of sub- section (4).15. Sale of mortgaged property- (1)

In this section, unless there is anything repugnant in the subject or context-

(a) "mortgage" means the transfer of an interest in specific immovable property for the purpose of securing the payment of the mortgage money or the performance of an obligation which may give rise to a pecuniary liability;

(a) "mortgage money" means any finance or other amounts relating to a finance, penalties, damages, charges or pecuniary liabilities, payment of which is secured for the time being by the document by which the mortgage is ef fected or evidence, including any mortgage deed or memorandum of deposit of title deeds; and

(a) "mortgage property means immovable property mortgaged to a financial institution.

2. (2) In case of default in payment by customer , the financial institution may send a notice to the mortgagor demanding payment of the mortgage money outstanding within fourteen days from service of the notice, and failing payment of the amount within due- date, it shall send a second notice of demand for payment of the amount within fourteen days. In case the customer on the due date given in(2) In case of default in payment by customer , the financial institution may send a notice on the mortgagor demanding payment of the mortgage money outstanding within fourteen days from service of the notice, and failing payment of the amount within due- date, it shall send a second notice of demand for payment of the amount within fourteen days. In case the customer the second notice sent, continuous to default in payment, financial institution shall serve a final notice on the mortgagor demanding the payment of the mortgage money outstanding within thirty days from service of the final notice on the customer .on the due date given in the second notice sent, continuous to default in payment, financial institution shall serve a final notice on the mortgagor demanding the payment of the mortgage money outstanding within thirty days from service of the final notice on the customer .

3. (3) When a financial institution serves a final notice of demand, all powers of the mortgagor in regard to recovery of rents and profits from the mortgaged property shall stand transferred to the financial institution until such notice is withdrawn and it shall be the duty of the mortgagor to pay all rents and profits from the mortgaged property to the financial institution.

Provided that where the mortgaged property is in possession of any tenant or occupier , other than the mortgagor , it shall be the duty of such tenant or occupier , on receipt of notice in this behalf from the financial institution, to pay to the financial institution the rent of lease money or other consideration agreed with the mortgagor .(3) When a financial institution serves a notice of demand, all the powers of the mortgagor in regard to recovery of rents and profits from the final mortgaged property shall stand transferred to the financial institution until such notice is withdrawn and it shall be the duty of the mortgagor to pay all rents and profits from the mortgaged property to the financial institution.

Provided that where the mortgaged property is in possession of any tenant or occupier , other than the mortgagor , it shall be the duty of such tenant or occupier , on receipt of notice in this behalf from the financial institution, to pay to the financial institution the rent of lease money or other consideration agreed with the mortgagor .

4. (3) Where a mortgagor fails to pay the amount as demanded within the period prescribed under sub-section

(2) and after the due date given in the final notice has expired, the financial institution may , without the intervention of any court and subject to any Rules made by the Federal Government under sub-section (5), sell the mortgaged property or any part thereof towards total or partial satisfaction of the outstanding mortgage money in the following manner , namely:-

(a) the financial institution shall have the mortgaged property evaluated by a reputable valuation company on the panel of the Pakistan Banks Association as on the date of the final(3) Where a mortgagor fails to pay the amount as demanded within the period prescribed under sub-section (2), and after the due date given in the final notice has expired, the financial institution may , without the intervention of any Court, sell the mortgaged property or any part thereof by public auction and appropriate the proceeds thereof towards total or partial satisfaction of the outstanding mortgage money .

Provided that before exercise of its powers under this subsection, the financial institution shall cause to be published a notice in one reputable English daily newspaper with wide circulation and one Urdu daily newspaper in the Province in which notice sent to the mortgagor under sub-section (2);

(a) the financial institution shall cause to be published a notice in one reputable English daily newspaper with wide circulation and one reputable Urdu daily newspaper with wide circulation in the Province in which the mortgaged property is situated specifying the following, namely:-

(i) detailed particulars of the mortgaged property:

(ii) name and address of the mortgagor;

(iii) amount of the outstanding mortgage;

(iv) any encumbrances which the mortgaged property may be subject to which the financial institution is aware of; (v)the financial institution' s intention to sell the mortgaged property through a public auction;

(vi) the reserve price below which the mortgaged property cannot be sold;

(vii) the time and place at which the public auction is to take place, provided that the public auction shall take place in the city where the mortgaged property is located; and

(viii) any other information, which may be relevant;

(c) the financial institution shall Send a notice with the information specified in clause (b), to the mortgagor and to all persons who, to the knowledge of the financial institution, have an interest in the mortgaged property as mortgagees; and

(d) the public auction for the sale of the mortgaged property shall Not take place before the expiration of three business days of the publication of the notice as required under clause (b)the mortgaged property is situated, specifying particulars of the mortgaged property , including name and address of the mortgagor , details of the mortgaged property , amount of outstanding mortgage money , and indicating the intention of the financial institution to sell the mortgaged property . The financial institution shall also send such notices to all persons who, to the knowledge of the financial institution, have an interest in the mortgaged property as mortgagees.

5. (5) In addition to its powers under section 25 and 26, the Federal Government may , by notification in the of ficial Gazette, make Rules specifying the mode, conduct or method of sale of the mortgaged property and in addition to the conditions stipulated in sub-section (4).

6. (6) The financial institution shall be entitled, in its discretion, to participate in the public auction and to purchase the mortgaged property for an amount ten percent higher than the highest bid obtained in the public auction, provided that where the financial institution chooses to purchase the mortgaged property at the highest bid obtained in the public auction, it shall issue notice to the mortgagor who shall have three business days from the service of the notice to match the financial institution' s bid. If the mortgagor is able to match the financial institution' s bid, he shall be allowed to purchase the mortgaged property .(5) The financial institution shall be entitled, in its discretion, to participate in the public auction, and to purchase the mortgaged property at the highest bid obtained in the public auction.

7. (8) Where the mortgagor or his agent or servant or any person put in possession by the mortgagor or on account of the mortgagor does not voluntarily give possession of the mortgaged property sought to be sold or sought to be purchased or purchased by the financial institution, a Banking Court on application of the financial institution or purchaser shall put the financial institution or purchaser , as the case may be, in possession of the mortgaged property in any manner deemed fit by it: Provided that the Banking Court may not order eviction of a person who is in occupation of the mortgaged property or any part thereof under a bona fide lease, except on expiry of the period of the lease, or on payment of such compensation as may be(5) Where the mortgagor or his agent or servant or any person put in possession by the mortgagor or on account of the mortgagor does not voluntarily give possession of the mortgaged property sought to be sold or sought to be purchased or purchased by the financial institution, a Banking Court on application of the financial institution or purchaser shall put the financial institution or purchaser , as the case may be, in possession of the mortgaged property in any manner deemed fit by it: Provided that the Banking Court may not order eviction of a person who is in occupation of the mortgaged property or any part thereof under a bona fide lease, except on expiry of the period of the agreed between the parties or as may be determined by the Banking Court to be reasonable.

Explanation.--Where the lease is created after the date of the mortgage and it appears to the Banking Court that the ease was created so as to adversely , affect the value of the mortgaged property or to prejudice the rights and remedies of the financial institution, it shall be presumed that the lease is not bona fide, unless proved otherwise.lease, or on payment of such compensation as may be agreed between the parties or as may be determined to be reasonable by the Banking Court.

Explanation.--(1) Where the lease is created after the date of the mortgage and it appears to the Banking Court that the lease was created so as to adversely , affect the value of the mortgaged property or to prejudice the rights and remedies of the financial institution, it shall be presumed that the lease is not bona fide, unless proved otherwise.

8. For purposes of execution and registration of the sale-deed in respect of the mortgaged property , the financial institution shall be deemed to be the duly authorised attorney of the mortgagor and a sale- deed executed and presented for registration by duly authorized attorneys of the financial institution shall be accepted for such purposes by the Registrar and Sub- Registrar under the Registration Act, 1908 (XVI of 1908): Provided that no such sale deed shall be executed or registered until expiry of seven days after the completion of the public auction for the sale of the mortgaged property .(7) For purposes of execution and registration of the sale-deed in respect of the mortgaged property , the financial institution shall be deemed to be the duly authorised attorney of the mortgagor and a sale-deed executed and presented for registration by duly authorized attorneys of the financial institution shall be accepted for such purposes by the Registrar and Sub Registrar under the Registration Act, 1908 (XVI of 1908).

9. (9) Upon execution and registration of the sale-deed of the mortgaged property in favour of the purchaser all rights in such mortgaged property shall vest in the purchaser free from all encumbrances and the mortgagor shall be divested of any right, title and interest in the mortgaged property .(8) Upon execution and registration of the sale-deed of the mortgaged property in favour of the purchaser all rights in such mortgaged property shall vest in the purchaser free from all encumbrances and the mortgagor shall be divested of any rights, title and interest in the mortgaged property .

10. (10) Net sale proceeds of the mortgaged property , after deducting all expenses of sale or expenses incurred in any attempted sale, shall be distributed ratably amongst all(9) Net sale proceeds of the mortgaged property , after deducting all expenses of sale or expenses incurred in any attempted sale, shall be distributed ratably amongst all mortgagees in accordance with their respective rights and priorities in the mortgaged property . Any surplus left, after paying in full all the dues of mortgagees, shall be paid to the mortgagor .mortgagees in accordance with their respective rights and priorities in the mortgaged property . Any surplus left, after paying in full at the dues of mortgagees, shall be paid to the mortgagor .

11. (11) A financial institution which has sold mortgaged property in exercise of powers conferred herein shall file proper accounts of the sale proceeds in Banking Court within fourteen days of the sale.(10) A financial institution which has sold mortgaged property in exercise of powers conferred herein shall file proper accounts of the sale proceeds in Banking Court within thirty days of the sale.

12. (12) All disputes relating to the sale of the mortgaged property under this section including disputes amongst mortgagees in respect of the mode, conduct or method of the sale or the distribution of the sale proceeds, shall be decided by the Banking Court to the exclusion of any other court of law, including the High Court.(11) All disputes relating to the sale of the mortgaged property under this section including disputes amongst mortgagees in respect of distribution of the sale proceeds, shall be decided by the Banking Court.

13. (13) The Banking Court may grant an injunction restraining the sale or proposed sale of mortgaged property , if---

(a) it is satisfied that no mortgage in respect of the immovable property has been created; or

(b) it is satisfied that there is fraud in the proposed mode, conduct or method of the sale, provided that no injunction shall be granted on the ground of fraud unless upon the facts proved the Banking Court is satisfied that the applicant has sustained substantial injury by reason of such fraud and such injury cannot be compensated by damages; or

(c) all moneys secured by mortgage of the mortgaged property have been paid; or

(d) the mortgagor or objector deposits in the Banking Court in cash the outstanding mortgage money .(12) Neither the Banking Court nor the High Court shall grant an injunction restraining the sale or proposed sale of mortgaged property unless---

(a) it is satisfied that no mortgage in respect of the immovable property has been created; or

(b) all moneys secured by mortgage of the mortgaged property have been paid; or

(c) the mortgagor or objector deposits in the Banking Court in cash the outstanding mortgage money .

14. (14) Where any mortgaged property has been sold, the mortgagor or any person entitled to a share in the ratable distribution of assets or whose interest is af fected by the sale, may apply to the Banking Court to set aside the sale on the ground of fraud: Provided that no sale shall be set aside on the ground of fraud unless, upon the facts proved, the Banking Court is satisfied that the applicant has sustained substantial injury by reason of such fraud and such injury cannot be compensated by damages.

15. (15) An application for setting aside the sale under sub-section (14) must be made within seven days of competition of the public auction for the sale of the mortgaged property and shall not be entertained by the Banking Court unless the applicant deposits an amount equal to twenty- five percent of the reserve price or furnishes security for the same amount to the satisfaction f the Banking Court.

16. (16) The rights and remedies provided under this section are in addition to and not in lieu of any other rights or remedies a financial institution may have under this Ordinance.(13) The rights and remedies provided under this section are in addition to, and not in lieu of, any other rights or remedies a financial institution may have under this Ordinance.

17. (17) The provision contained in this section shall have ef fect notwithstanding anything contained in this Ordinance or any other law for the time being in force or any judgment of any court and in case of any conflict between the provisions contained in this section and any other law for the time being in force or any judgment of any court, the provisions contained in this section shall prevail.(14) The provisions contained in this section shall have ef fect notwithstanding anything contained in this Ordinance.

23. Before assessing the merits of the submissions, it is expedient to reproduce relevant paragraphs of the judgment in the case of SAF Textile Mills Limited (supra) - to understand and appreciate 'what was conspicuous by its absence' in the original section 15 of Ordinance, that led to its fall. Relevant paragraphs of the judgment are reproduced hereunder; "33. The matters pertaining to the financial claims secured by mortgagors as in the instant case, generally involves a two stage process, firstly the determination of the liability through due process and after a fair trial inclusive of a right of hearing and opportunity of show cause. Such determination under the general law, is evidenced by a decree of a Court of competent jurisdiction. And secondly , the recovery of the determined amount by way of the satisfaction or execution of such decree including through the sale of mortgaged property . Even if a liability has been determined by a decree of the Court, the mortgagor/debtor is not deluded of all his civil rights including with regards to the modes and methods of such recovery through the sale of the mortgaged property . The right of such debtor to ensure that the mortgaged property is sold in a free, fair and transparent manner so as to fetch the best possible price is now a well-recognized principle of law, which finds its manifestation both in various statutory provisions, more particularly , Code of Civil Procedure (including Order XXI of C.P.C.) as well as the law, as laid down by this Court, including the case reported as Mir Wali Khan v. Agricultural Development Bank of Pakistan, Muzaf fargarh and another ( PLD 2003 SC 500 ), wherein it has been held as follows:-- "Crux of what has been discussed above is that clever maneuvering forcing way for disposal of a property in execution of a decree for a paltry sum has to be guarded against and jealo usly so with all the care and circumspection so that it may go for a sum it deserves."

34. A detailed procedure is laid down including by providing opportunities to such mortgagors/debtors and others to enforce their rights through appropriate remedies. The opportunities are usually available both prior to the sale and after the fall of the hammer . Built-in safeguards have been incorporated in the terms and conditions of the sale, which are settled after affording an opportunity of hearing to the mortgagor/ debtor usually after notice under Order XXI Rule 66 of the Civil Procedure Code, 1908 and objections and suggestions of such debtor are taken into account. Once the sale has taken place, the mortgagor/debtor is granted an opportunity to object including to the mode and method in which the sale was actually conducted. This right to object in this behalf is of vital importance so as to ensure that a free, fair and transparent sale actually takes place and no sham proceedings are undertaken or a fictitious report in this behalf is filed.

35. Such objections can be filed under Order XXI Rule 90 C.P.C. and even with respect to the sales of mortgaged property , which are effected under the provisions of the Ordinance of 2001 by the Court in execution, in addition to the above, objections application under section 19(7) of the Ordinance of 2001, can be filed. It may be noted with interest that the sale does not attain finality , until such objections are decided. Even otherwise, in the absence of any such objection, under the law, the Court is vested with the inherent jurisdiction to examine the record and so as to ensure that the sale has been lawfully conducted. It is only then all rights in the mortgaged property are finally extinguished .

36. The real import and effect of section 15 of the Ordinance of 2001 is revealed when examined in the above backdrop and the most significant aspec t of the said provision is not what is provided thereunder but what is conspicuous by its absence. The Financia l Institutions have been authorized to sell a particular mortgaged property without intervention of the Court by virtue of subsection (4) of section 15 of the Ordinance of 2001. After the sale takes place (real or fictitious), a sale deed, in respect of the property is to be executed by a Financial Institution, which is authorized in this behalf by virtue of subsection (7) of section 15 of the Ordinance of 2001. Upon the registration of the sale deed, all rights title in interest of the mortgagor/debtor in the mortgaged property stand extinguished and such property vests in the purchaser free from all encumbrances, as is provided by subsection (8) of section 15 of the Ordinance. Whereafter , the Financial Institution, which has sold the mortgaged property is required to submit a proper account to the Banking Court in terms of subsection (10) of section 15 of the Ordinance of 2001. There is no provision, which permits a mortgagor/debtor to object to the conduct of the sale after the fall of the hammer . He is in fact deprived of the right even to agitate that the alleged proceedings for sale were sham and fictitious or carried out mala fide behind closed doors.

37. No doubt subsection (11) of section 15 of the Ordinance of 2001 does refer to the resolution of disputes relating to the sale of the mortgaged property by the Banking Court. Even if an objection raised under subsection (11) of section 15 of the Ordinance of 2001, it is of no practical legal significance, as the property sold already vests in the purchaser free from all encumbrances by virtue of subsection (8) of section 15 of the Ordinance of 2001. Thus, it is clear and obvious that the real intent and purpose of the aforementioned provisions of section 15 of the Ordinance of 2001 is to deprive the mortgagor/debtor of his right to object to the mode, the conduct of the mode and method of the conduct of the sale by barring all remedies their against. In the instant case, such extinguishment of right occurs without any process let alone after due process and fair trial, as envisaged by Article 10A of the Constitution. The right in property in terms of Article 24 of the Constitution also stands bruised and offended against.

38. Should the mortgagor/debtor be aggrieved of the terms and conditions settled by the Financial Institution for such sale, he may invoke the jurisdiction of the Banking Court directly if possible or through collateral proceedings but such Court, i.e. the Banking Court or the High Court is debarred from granting any injunction, restraining the sale of the mortgaged property by virtue of subsection (12) of section 15 of the Ordinance of 2001 except upon the due fulfilment of the condition mentioned in sub-clauses (a), (b) and (c) thereof Yet again, it has been noticed that fair and well-recognized terms and conditions and the mode and methodology of sale of mortgaged property recognized by law or by jurisprudence have been excluded from the purview of the grounds to obtain an injunction against the sale before it takes place are conspicuous by their absence. Thus, in practical legal terms, an objection perhaps may be raised but the sale will go through whereafter the same shall achieve finality by virtue of subsections (7) and (8) of section 15 of the Ordinance of 2001 referred to above and such objections would automatically fructify as no power to set aside the sale has been conferred upon the Banking Court or for that matter to the High Court. Yet again, the mortgagor/ debtor is deprived of his right to object that the auction in question was not conducted in accordan ce with the well recognized terms and conditions to ensure a fair and transparent sale so as to fetch the highest possible price and in case of violation thereof, he is left remediless. The depravation of the rights of the mortgagor/ debtor qua the terms and conditions of sale is yet against without any fair trial or due process, as envisaged by Article 10A of the Constitution.

39. In the above context, it may be appropriate to observe that it is an elemental principle of law that the denial of a remedy is in fact the destruction of the Right.

40. As a supplement to the aforesaid, it may be noted that no doubt, some rudimentary procedure for conducting such sales is provided in subsection (4) of section 15 of the Ordinance of 2001 but yet again the time honored and well entrenched principle of fixation of a "reserve price" is conspicuous by its absence. It is now well settled law that even where the sale is conducted by the Court a "reserve price" is essential and the absence thereof may be fatal.

In this behalf, it may be advantageous to refer to the majority judgment in the case reported as Messrs Lanvin Traders, Karachi v. Presiding Officer, Banking Court No.2, Karachi and others (2013 SCMR 1419 ), the relevant observations thereof are reproduced hereunder-- "Agreed that the expression "reserve price" does not find mention in the relevant Rule but the words used in the Rule pointedly hint thereto. A sale, in its absence, is apt to give walkover to maneuvers to fix any price of their choice. A sale thus effected is no sale in the eye of law especially when the number of bidders is meager , which, indeed is close to nill. A superstructure of sale built on such a shaky infrastructure cannot sustain itself. Neither the buttress of limitation nor the ministerial nature of the Rule can prevent it from a fall."

41. The conscious exclusion of remedies and deliberate omissions provide for a due process of conduct of sale including the absence of the necessity to fix a reserve price becomes even more significant, as the Financial Institution has been clothed with the right to purchase the property put by it to public auction at the highest bid. No permission, in this behalf, is required from any Court, as is in the normal course in terms of C.P.C. Thus, in fact, it is a Financial Institution, which is the seller , buyer , the auctioneer and the beneficiary , hence enabled to take full advantage of the misfortune of the mortgagor/debtor thereby facilitating predatory and exploitative behavior which perhaps would not sit well with Article 3 of the Constitution.

24. Their lordships while reviewing the question of constitutionality of original section 15, observed that 'the most significant aspect of said provision is not what is provided thereunder but what is conspicuous by its absence". The elemental question is that whether re-enacted section 15 has equipped the mortg agors with adequate rights and remedies qua the conduct of auction sales of the mortgaged properties, both prior to the conduct of sale and, in particular , after the fall of the hammer . There is no cavil that some remedies were available under the original section 15, but were held ineffective, insuf ficient and feeble to counter a blitzkrieg by the financial institutions. Upon perusal of re-enacted section 15 it is evident that fundamental right of redemption is acknowledged and secured through provisioning of corresponding remedies to the mortgagor , which inter alia included remedy to raise disputes regarding creation of mortgage and outstanding mortgage money , dema nded through statutory notices.

The legislature, while re-enacting section 15 of the Ordinance, 2001, has conspicuously provided remedies, before and after the conduct of auction sales. A reference is made to sub-sections (13), (14) & (15) of re-enacted section 15, to indicate the scope of restitutive remedies. The mortgagor under clauses (a) & (c) of sub-section (13) of re- enacted section 15 may object to the creation of mortgage and quantum of the outstanding mortgage money claimed - sufficiency of the cause to be determined by the Banking Court. In terms of clause (d) of sub-section (13) of re-enacted section 15 the mortgagor can exercise right of redemption of property , subject to the payment of outstanding mortgage money . Banking Courts possess exclusive jurisdiction in terms of sub-section (12) of section 15 to entertain and adjudicate upon the disputes raised. The remedies provided are subjected to the conditions prescribed.

25. One of the key requirement for the conduct of auction sale relates to the determination and fixation of reserve price before the conduct of auction - which was discussed in paragraphs 40 and 41 of the judgment in the case of SAF Textile Mills Limited (supra), wherein reference was made to the judgment in the case of Messes Lanvin Traders Karachi v. Presiding Officer, Banking Court No.2, Karachi and others (2013 SCMR 1419 ). Re- enacted section 15 caters for the requirement of evaluation of the mortgaged property and provides mechanism of its determination under clause (a) of sub-section (4) of section 15 and Rule 3 (b) of Rules, 2018. The mortgagor can always object to the evaluation determined for the purposes of fixing reserve price by resorting to remedy under clause (b) of sub-section (13) of re-enacted section 15, and establish fraud and substantial injury to the satisfaction of the Banking Court - a reme dy similar in the nature of remedies unde r sub-section (7) of section 19 of Ordinance, 2001, and under Order XXI Rule 66 of the Code.

26. We now proceed to examine the reme dies, provided to the mortgagors, in particular , to object to the conduct of auction sale - after the fall of the hammer . In the case of SAF Textile Mills Limited (supra) it was observed that "denial of remedy is in fact the destructio n of the Right". The Right of the mortgagor to redeem the property upon payment of outstanding mortgage money is guaranteed and so is the right to seek setting-aside of the auction sale upon establishing element of fraud, resulting in substantial injury , not capable of being compensated by damages.

The right to object is preserved by provid ing a remedy under sub-sections (14) & (15) of re-enacted section 15 - remedy in the nature of post-sale objections, having similitude to the remedy under Order XXI Rule 90 of the Code.

The remedies provided under sub-sections (13), (14) & (15) of re-enacted section are exclusive to the mortgage action and shall be governed subject to the requirements and conditions prescribed under re-enacted section 15.

27. Their lordships, in paragraph 38 of the judgment in the case of SAF Textile Mills Limited (supra), observed that in view of sub-sections (7) and (8) of original section 15, the property once sold would vest in the purchaser free from all encumbrances, having the effect of extinguishing any and all rights of the mortgagor , whereupon objections would automatically fructify . No one has argued against or disputed the jurisp rudential concept of finality of involuntary and / or non-judicial sales, nor was it declared unconstitutional, void or an act of infringement of any of the guaranteed fundamental rights. The main reasoning in the case of SAF Textile Mills Limited (supra) was that finality conferred, in terms thereof, was done without affording adequate opportun ities to object to the mortgagor , which depravation of rights and absenc e of corresponding remedies compromise fairness, transparency and possibility of fetching highest possible price.

28. A peculiar and distinctive feature of transaction of mortgage is the right of redemption of mortgaged property , which right is neither available nor can be claimed perpetually - not available for all times to come or infinite. The right of redemption is extinguished or lost, either through a contractual arrange ment - executed between the mortgagor and mortgagee subsequent to the mortgage- or upon the sale of the mortgaged property by the mortgagee - financial institution in this case - in exercise of statutory power conferred, as provided through re- enacted section 15. Re-enacted section 15 has not affected, prejudiced or taken away the right of the mortgagor to redeem mortgaged property- which rights are available and can be exercised by the mortgagor , in terms of the remedies provided under the law. The law provides the circumstances/situations when right of redemption is lost or would give way to the rights of the prospective purchaser . In this context, re-enacted section 15 provides two kinds of rights and corresponding remedies; right of redemption of mortgaged property and right to object to the mode, conduct and method of sale conducted - after the fall of the hammer . The legislatur e has wisely segregated above- noted rights and provided specific remedi es for the exercise of each of such right, and indicated time frame, within which each of above-noted right is exercisable. We are not dealing or dilating upon the issues as to when a right of redemption would become exercisable, when it would extinguish, and at what point in time the property would stand conveyed to the purchaser , free of any and all encumbrances, all of which issues may be adjudicated upon by the Banking Courts, depending upon the facts and circumstances of each case. Even otherwise, these questions bear no relevance for determination of constitutionality of re-enacted section 15.

29. The conferment of unassailable and unimpeachable rights unto auction purchaser is not a new phenomenon but, available under section 69 (3) of the Transfer of Property Act, 1882 and provisions regarding sale of pledged goods under the Contract Act, 1872, which provisions of law withstood the test of constitutionality . There is no need to dilate upon the concept of legality of non-judicial sales or appreciate the ratio in the case of Umer Rathore (supra), when the Apex Court has endorsed such concept. It is apt to refer to paragraph 42 in the case of SAF Textile Mills Limited (supra), which reads as; "42. In view of the above, we find ourselves unable to agree with the learned counsel qua their view of the true effect of section 15 of the Ordinance of 2001 as canvassed by them at bar. However , it may be appropriate to refer to the contentions of the learned counsel that the findings by way of the impugned judgment that a sale of mortgaged property without intervention of the Court is per se unconstitutional is not sustainable"

[Emphasis supplied]

30. The threshold question of availability of remedy - in the context of observations made by their lordships in the case of SAF Textile Mills Limited (supra) that denial of remedy amounts to destruction of the Right - needs elucidation. The underline theme of argum ents by the respondents is that re-enacted section 15 has acknowledged rights and provided remedies, subject to the conditions prescribed. The question which has surfaced is that whether a mortgagor - who may be a person to whom finance has been extende d or someone who has secured payment of the mortgage money by transferring interest in the mortgage property - can invoke a remedy of filing a suit under section 9 - alleging default in the performance of an obligation by the financial institution or seeking declaration against creation of mortgage. Learned counsel for respondents No.3 to 5 submits that mortgagor may invoke remedies available, either under re-enacted section 15 or section 9 of the Ordinance, 2001, depending upon the nature of the claim and relief soug ht, which is for the Banking Court to determine. It is evident that the mortgagor can avail remedies under section 9 of the Ordinance, 2001 read with the remedies under re-enacted section 15 - depending upon the nature of the claim and relief sought. The nature / format of the claims raised by the mortgagors before the Banking Courts require no adjudication, we are only examining the factum of availability / existence of the Right and corresponding remedy . It is apparent that remedies to be availed by the mortgagor are always and shall be regulated and governed under the conditions prescribed in re-enacted section 15, to which exclusive and non-obstante effect is extended under sub-section (17) of section 15. Needless to mention that in case of any conflict whatsoever between any provision of the Ordinance, 2001 - including section 9 thereof, or any other applicable law - and re-enacted section 15, it is re-enacted section 15, which shall always prevail. While examining the issue of availability of remedy we lay our hands on decision in the case of "AMTEX LIMITED through Director v. BANKISLAMI PAKIST AN LTD. and 8 others" (2016 CLD 2007 ), wherein the scope of section 9 of Ordinance, 2001, and remedy available to the customer was narrowly interpreted in view of the definition of the expression "obligation" under section 2(e) of Ordinance, 2001. It is expedient to reproduce relevant portions of said judgment to facilitate understanding, which read as; "31. While putting a construction on the term 'obligation', the purpose of defining the term in a certain manner has to be kept in view. Obviously , had the legislature intended the representations and covenants made by the financial institution to be part of 'obligation' so as to premise and found the suit under section 9, it would have spelt it out clearly and without equivocation. The intent of the legislature is not in doubt. It is that any alleged default in fulfillment of any obligation regarding any representation, warranties and covenant s by a financial institution is not enforceable in the special jurisdiction under Ordinance, 2001. This construction also lends credence to the scheme and policy of the Ordinance, 2001 which has been enacted primarily to act as an engine of recovery of defaulted finance by the financial institutions and not vice versa. The customers may have a cause of action but that is enforceable in the Courts of general jurisdiction only. The definition of the term 'obligation' in fact restricts the meaning of the term within a certain perip hery. Rather than expanding it, the meaning is exhausted and limited. It is limited to only two facets of obligation.

32. Secondly , for various reasons, the term 'includes' does not expand the scope of the term 'obligation' so as to include the nature of the suit filed by the plaintiff. As stated above, this is a special jurisdiction conferred upon this Court and can only be triggered if a default in the fulfillment of any obligation is committed. Therefore, any question regarding the expansion of the meaning of the term 'obligation' will be in the realm of a question of jurisdiction and it will have to be seen in that perspective ........ ............ Simply put, this Court will have jurisdiction in case of any allegation of default in the fulfillment of any representations, warranties and covenants made by or on behalf of the customer but will not assume jurisdiction if the allegation is that the default is commit ted in respect of any representations, warranties and covenants made by or on behalf of the financial institution. There is a world of difference in the two concepts and the legislature has conferred jurisdiction on this Court with regard to the former and not the latter . The jurisdiction of this Court cannot be enlarged on the basis of any rule of interpretation propounded by the courts".

31. We have examined the judgment, wherein expression 'obligation' [defined in section 2 (e) of Ordinance, 2001] was interpreted, its scope and extent discussed, resulting into squeezing or denial of remedies under section 9 of the Ordinance, 2001. With due respect, we disagree with the ratio/reasoning of the judgment in the case of "AMTEX LIMITED (supra). The expression 'obligation' was incorrectly interpreted, without considering and giving effect to the interpretative criteria provided in section 2 of the Ordinance, 2001, wherein definitions were subjected to by inclusion of the phrase "unless there is anything repugnant in the subject or context ". The definition of 'obligation' has to be interpreted in the light of interpretative criteria, i.e. if there is anything repugnant in the subject or context. The scope of section 9 of the Ordinance cannot be subjected to the definition of "obligation", rather the expression obligation has to be interpre ted in the context of the object and purpose of the Ordinance, 2001 - enabling special remedy to the parties under special dispensation. Even otherwise denial of remedy of a claim under section 9 of Ordinance, 2001, to mortgagor would mean destruction of the Right, to seek requisite declarations and claim damages. To understand the effect and purpose of the phrase "unless there is anything repugnant in the subject or context" we seek guidance from the dictum laid in the case of "IFTIKHAR AHMAD and others v. PRESIDENT , NATIONAL BANK OF PAKIST AN and others" (PLD 1988 SC 53), relevant portion whereof is reproduced hereunder as; "10. It is difficult to subscribe to the view taken by the learned Judges in the High Courts. No doubt, the award given by the Wage Commission is not included in the definition of the term 'award ' as given in section 2(ii) of the Ordinance, but then as the governing clause of section 2 itself states the definitions given therein are to be read subject to anything repugnant in the context in which the defined terms occur . Apart from that, as held by this Court in Bank of Bahawalpur v. Chief Settlement and Rehabilitation Commissioner PLD 1977 SC 164 that although normally an expression if defin ed in a Statute has to be given the same meaning wherever it occurs therein, yet there is ample authority for the principle of interpretation, that a definition of a term in a Statute is merely declaratory in nature and should not be unnecessarily inflicted where it does not fit in with the subject or context".

It is expedient to reproduce a paragraph from Book titled as 'The Construction of Statutes Earl. T . Crawford (Re- print 2014, Published by Pakistan Law House) at pages 362 and 363, which reads as; "But the meaning of the legislature, as revealed by the statute considered in its entirety , if contrary to the expressions of the interpretation clause or the legislative definitions, will prevail over them. That is, the interpretation clause will control in the absence of anything else in the act opposing the interpretation fixed by the clause. Nor should the interpretation clause be given any wider meaning than is absolutely necessary . In other words, it should be subjected to a strict construction----".

"---In the event that the definition found in the interpretation clause is at variance with the intention of the lawmakers as expressed in the plain language of the statute, that intention must prevail over the legislative definition. In other words, the intent of the legislature must control the legislative definition. But the interpretation clause and the statute proper must all be construed together as a part of the same statute. Where this is done, if the definition laid down by the legislature does not conflict with the intent of the legislature, then the former may be given effect. If the two can be harmonized, there can be no objection to allowing the interpretation clause to control the language defined. To give the interpretation clause precedence where the two cannot be harmonized, would operate to make the ancillary portion of the statute superior to the primary portion. The statute' s meaning would in all probability be distorted, and the legislative intent defeated."

A reference to the case of "Green v Governing Body of Victoria Road Primary School and another" [2004] 2 All ER 763 ^[50] and observation therein is apt, which says that "care must be taken to distinguish a legislative signpost from the definition ". The legislative intent is clear , a mortgagor , may file a claim in terms of section 9 of the Ordinance, 2001 in consonance with the remedies afforded under re-enacted section 15, depending upon the nature of the claim raised and relief sought, which claim and proceedings therein shall be governed and regulated in terms of requirements and conditions prescribed under re-enacted section 15. Hence, re-enacted section 15 has afforded requisite remedies and protected the Right, suf ficient enough to cater for the Constitutional guarantees.

32. Now we proceed to deal with the submissions that whether section 15 imparts "inequality before the law" and per-se "discriminatory" - as claimed that it creates two parallel methods for recovery of financial claims, one by resorting to section 9 of the Ordinance, 2001 - which envisages initiation of civil action, determination of liability through the judicial process, passing of a decree, followed by enforcement proceedings for realization of determined amount - and, other recove ry method envisages process of recove ry of mortgage money - which empowers financial institution to circumvent process of adjudication, determination of claims, and to proceed with the sale of mortgaged property , to the exclusion of the Courts. It is argued by learned counsel for the petitioners that re-enacted section 15, is capable of being employed in discriminatory manner , as discretion extended is unfettered and unstructured. Reliance is placed on the cases of WARIS MEAH (supra), "MUHAMMAD UMER RATHORE" (supra) "Syed MUHAMMAD SHAH (supra). It appears from paragraphs 43 and 44 in the case of SAF Textile Mills Ltd. (supra) that issue highlighted above was not adjudicated upon, which paragraphs are reproduced hereunder as; "43. The aforesaid contentions need to be examined in the context that the Ordinance of 2001 perceives to two parallel methods of recovery of claims from mortgagors either by filing a suit for recovery under section 9 of the Ordinance of 2001 followed by a decree to be executed in terms of section 19 thereof or by simply exercising powers conferred upon the Financial Institution by section 15 of the Ordinance of 2001. The first course of action i.e. the filing of a suit and execution of the decree envisages remedies for, the mortgagor/debtor , who is entitled to raise objections and the right to have his grievance heard and redressed by way of adjudication through judicial powers of the State, while, all such rights and remedies are lost when section 15 of the Ordinance of 2001 is pressed into service. Two parallel systems are contemplated one much harsher than the other , leaving unfettered and unstructured discretion with the Financial Institution without any predetermined criterion.

44. Be that as it may, it is not necessary to adjudicate upon this aspect of the matter , as we have already held that the above mentioned material provisions of section 15 of the Ordinance of 2001 are ultra vires to the Constitution .

The rump of the section that remains is incapable of being severed and its presence in the statute would at best be ineffective and at worse cause for further mischief, therefore, the entire section 15 of the Ordinance of 2001 is held to be ultra vires to the Constitution. Such a course of action would be in accordance with the law, as laid down by this Court in the case of Baz Muhammad Kakar and others v. Federation of Pakistan through Ministry of Law and Justice, Islamabad and others ( PLD 2012 SC 870 )".

[Emphasis supplied]

33. Undoubtedly , principle of equality before the law is a basic norm of every legal system, and a stepping stone to access the realm of fundamental rights. No distinction between the citizens / persons is permissible regarding dispensation of law and enforcement thereof, except through a classification / identification of a particular category or class, formed on the basis of intelligible differentia - distinguishing the persons or things from other category of persons or things consciously missed out. While dilating upon the doctrine of classification, Mr. Justice Fazal Karim in his Book "Judicial Review of Public Actions" (Second Edition) at Page 1333 (Volume 2) says that Classification has been judicially accepted as an integral part of the right to equality , and while quoting Justice Frankfurter in Dennis (1950) 339 US 160, wrote that That there is no greater inequality that the equal treatment of unequals" . In the case of Dr. Mobashir Hassan and others (supra) their Lordships has discussed the principle of 'reasonable classification' as elaborated in the case of "GOVERNMENT OF BALOCHIST AN through Additional Chief Secretary v. AZIZULLAH MEMON and 16 others" (PLD 1993 SC 341) and the case of " Miss SHAZIA BATOOL v. GOVERNMENT of BALOCHIST AN and others" (2007 SCMR 410). The elemental question is that whether transaction of mortgage and mortgagor(s) are treated as distinct category of transaction(s) and class of persons for the purposes of enforcement of re-enacted section 15. Re-enacted section 15 only envisaged action against the mortgagor(s) - a category of peculiar transaction and class of person(s) - those who have executed a document, either a mortgage deed or Memorandum of Deposit of Title Deed, and secured payment of the money against specified immovable property . A person who has not mortgaged property (non-mortgagor) is not amenable to the method of recovery provided under re-enacted section 15. The mortgage transaction possesses a separate, independent and distinctive character , when examined in the context of contractual promises / commitments made by the persons, classified as mortgagor s. In view of separate category / class / classification extended to the mortgagors, the judgment in the case of Waris Meah (supra), is not applicable. The reasoning in the case "Waris Meah" (supra) is relevant for the purposes of drawing a distinction, which reads as: "In the present case, the question to be determined is whether the impugned Act is ex-facie discriminatory , and we have no hesitation in saying it is. Three tribunals with different powers and procedures have been set-up. The Act creating them contains no indication as to which class or classes of cases are to go to before a Court, and which before the Tribunal and the Adjudicating Officer , and it does not impose upon the Central Government the obligation, or expressly confer on it the power , of making rules with a view to clarify ing the case to be tried by each of the tribunals. Nor does it define the principle or policy on which such classification may be made by the Central Government or the State Bank.

"Here, not only is there discretion in the specified authorities whether they will proceed at all against any member of the class concerned, viz. offenders again st the Act, but there is also an unfettered choice to pursue the offence in any one of three different modes which vary greatly in relation to the opportunity allowed to the alleged offender to clear himself, as well as to the quantum and nature of the penalty which he may incur. The scope of the unguided discretion so allowed is too great to permit of application of the principle that equality is not infringed by the mere conferment of unguided power , but only by its arbitrary exercise. For, in the absence of any discernible principle guiding the choice of forum, among the three provided by the law, the choice must always be, in the judicial viewpoint, arbitrary to a greater or less degree. The Act, as it is framed, makes provision for discrimination between persons falling, qua its terms, in the same class, and it does so in such manner as to render it impossible for the Courts to determine, in a particular case, whether it is being applied with strict regard to the requirements of Article 5 (1) of the Constitution...........

In our view such a law has the effect of doing indirectly i.e., by leaving the discrimination within the unguided and unfettered discretion of statutory authorities, what it could not do directly i.e., to treat unequally persons falling within the same class, upon a basis which bears no reasonable relation to the purposes of the law .

[Emphasis supplied]

34. The case of "Syed MUHAMMAD SHAH (supra) deals with conflict between two special laws containing overriding clauses, contained in Financial Institutions (Recovery of Finances) Ordinance 2001 and Offences in Respect of Banks (Special Courts) Ordin ance, 1984. Relevant portion of the case of "Syed MUHAMMAD SHAH (supra) is reproduced to facilitate understanding, which reads as under: "Were both laws to apply concurrently and permit of parallel platforms for the adjudication of offences under both laws then banks/financial institutions would always choose to initiate proceedings under the more onerous law, in this case the ORBO. Such an interpretation would give banks/financial institutions unbridled power to choose the forum before which trial of offences shou ld take place, and they would obviously choose the Special Courts under the ORBO being more burdensome and prejudicial to the accused (as demonstrated above) ....... We do not wish to give financial institutions the unrestricted power to choose, when there has been an alleged dishonour of a cheque, between section 20(4) of the Ordinance, 2001 and section 489-F of the P.P.C., as they would of a certainty opt to initiate proceedings under the latter which offenc e carries a greater punishment than the former".

"17. In addition to our opinion expressed above about the redundancy of the Ordinance, 2001 (see paragraph No. 16), to allow forums under the Ordinance, 2001 and the ORBO to operate concurrently would offend the provisions of Article 25 of the Constitution of the Islamic Republic of Pakistan, 1973 (the Constitution) which provides that all citizens are equal before the law and are entitled to equal protection of the law; there being no defined guidelines on the basis of which cases may be tried under either law, it would tantamount to conferring unfettered discretion on financial institutions to pick and choose the forum as per their free will .......... Furthermore, Article 4 of the Constitution confers upon the citizens the inalienable right to enjoy the protection of law and to be treated in accordance with law. This provision is reflective of the seminal concept of the Rule of law, one of the elements of which is, as identified by Tom Bingham, that the law must be accessible and so far as possible intelligible, clear and predictable. If both the Ordinance, 2001 and the ORBO were to enjoy concurrent jurisdiction, citizens alleged to have committed an offence in respect of finance would be left wondering which offence they would be charged with, which Court they would be tried in and under what procedure. Thus, to our minds, such a situation would also be an af front to the provisions of Article 4 of the Constitution".

[Emphasis supplied]

35. The dicta laid down in the cases of Waris Meah (supra) and Syed Mushahid Shah (supra) are distinguishable and extends no assistance, wherein the Courts dealt with the laws affecting the liberty of the individuals, and not civil claims. The issues highlighted in case of Syed Mushahid Shah (supra) regarding absence of guidelines for choice of forum, unfettered discretion extended to pick and choose the forum or person and lack of clarity with respect punishment to the meted out, are fully addressed and catered for by the legislature while re-enacting section 15. The question of discriminatory application of law - to a particular category of transaction and class of persons or classes of cases, in the conte xt of equality before law - came up before the Hon'ble Supreme Court of Pakistan in the case of "DISTRICT BAR ASSOCIA TION, RAWALPINDI and others v. FEDERA TION OF PAKIST AN and others" (PLD 2015 SC 401). Their lordships while dealing with the question illustrated the principles laid down in the cases of "BRIG. (RETD.) F.B. ALI AND ANOTHER v. THE STATE" (PLD 1975 SC 506) and "I.A. SHAR WANI and others v. GOVERNMENT OF PAKIST AN through Secretary , Finance Division, Islamabad and others" (1991 SCMR 1041 ). It is expedient to reproduce paragraphs 164 and 165 of the part of the judgment, authored by Mr . Justice Sh. Azmat Saeed, as his lordship then was, which reads as; "164. The question of discrimination has been raised by the petitioners. In this behalf, reference may be made to the judgment of this Court, reported as Brig. (Retd.) F .B. Ali and another (supra), wherein it was held as follows: "Equal protection of the laws does not mean that every citizen no matter what his condition, must be treated in the same manner . The phrase 'equal protection' of the laws means that no person or class of persons shall be denied the same protection of laws which is enjoyed by other persons or the class of persons. ... "

It was also held: "... To justify the validity of a classification, it must be shown that it is based on reasonable distinctions or that it is on reasonable basis and rests on a real or substantial difference of distinction. ... "

It was further observed: "... Thus, in the field of criminal justice, a classification may well be made on the basis of the heinousness of the crime committed or the necessity of preventing certain anti-social effects of a particular crime. Changes in procedure may equally well be effected on the ground of the security of the State, maintenance of public order , removal of corruption from amongst public servants or for meeting an emergency" and also observed that: "The principle is well recognized that a State may classify persons and, objects for the purpose of legislation and make laws applicable only to persons or objects within a class.

In the case of "I.A. SHAR WANI and others v. GOVERNMENT OF PAKIST AN through Secretary , Finance Division, Islamabad and others" ( 1991 SCMR 1041 ), this Court held as follows: "... that in order to make a classification reasonable, it should be based--

(a) on an intelligible differentia which distinguishes person or things that are grouped together from those who have been left out;

(b) that the differentia must have rational nexus to the object sought to be achieved by such classification."................. .......... "165. The cases that can be tried under the Pakistan Army Act have been clearly identified in terms of offences enumerated therein when committed by a terrorist known or claiming to be a member of a group or organization or in the name of a religion or a sect. This is an ascertainable and clearly defined criteria based on an intelligible differentia and constitute a valid classification".

36. Another argument is that re-enacted section 15 is capable of being applied or used in discriminatory manner . In the first place, there is no discretion extended to the financial institution, rather a right otherwise conveyed to the mortgagee in terms of the voluntarily negotiated bargain, has been re-affirmed through a statutory dispensation.

The exercise of powers by the financial institution, as mortgagee, are well regulated, structured and accordingly circumscribed. We dispel the submissions that discretion extended to the financial institution in terms of re-enacted section 15 is capable of being employed in discriminatory manner . More provisioning of an additional remedy , without prejudice to other remedies availa ble to the financial institution under subsection (16) of section 15 -is not per se discriminatory . In the case of "Ocean Industries Limited" (supra) the Apex Court of the country has dealt with the issue of availability of alternate remedies available under Industrial Development Ordinance, 1961. No instance of any discrimination was pleaded nor discussed before us. The enactment cannot be declared unconstitutional on mere apprehension or allegation of discriminatory dispensation thereof. Reference is made to the case of "JIBENDRA KISHORE ACHHAR YYA CHOWDHUR Y and 58 others v. THE PROVINCE OF EAST PAKIST AN AND SECRET ARY, FINANC E AND REVENUE (REVENUE) DEPARTMENT , GOVER TNMENT OF EAST P AKIST AN" (PLD 1957 Supreme Court 9), relevant portion whereof is reproduced hereunder: "The Act challenged in these cases is not discriminatory on the face of it because it does no more than empower the Provincial Government to acquire the interests of such rent receivers as may be specified in the notification in any district, part of a district or local area, and the Provincial Government could, as it has actually done so far as the present, appellants are concerned, acquire the interests of all rent-receivers throughout the Province at one and the same time, and if the law be, as I think it is, that in cases where a statute is not ex facie discriminatory , but is capable of being administered in a discriminatory manner , the party challenging the constitutionality of that statute must show that it has actually been administered to the detriment of a particular class and in a partial, unjust and oppressive manner , the appel lants' case must fail because the acquisition challenged is not piecemeal but wholesale, and nobody can have any occasion to complain that he or the class to which he belongs has been singled out for a discriminatory treatment----".

The aforesaid view was reiterated in numerous cases, reported as "LAHORE DEVELOPMENT AUTHORITY through D.G. and others v. Mst. IMRANA TIWANA and others" (2015 SCMR 1739 ) and "FEDERA TION OF PAKIST AN and others v . SHAUKA T ALI MIAN and others" ( PLD 1999 SC 1026 ).

37. The remedy provided to Mortgagee/Financial Institution, under re-enacted section 15, is with reference to a particular transaction and / or a class of person(s), which transaction and class of person(s) are classified on the basis of clearly defined criteria, based on an intelligible differentia, having justifiable considerations and differences.

Apparently , there persists some confusion regarding concurrent use of expressions "customer" and "mortgagor" in sub-section (2) of re-enacted section 15 and occasionally in the Rules, 2018. Actually , no such confusion is found upon careful reading of the definition of Customer in terms of section 2 (c) of Ordinance, 2001. It is expedient to reproduce said definition for ease of reference, which reads as; "(C) "customer" means a person to whom finance has been extended by a financial institution [within or outside Pakistan] and includes a person on whose behalf a guarantee or letter of credit has been issued by a financial institution as well as surety or an indemnifier".

Customer includes a person to whom finance has been extended, i.e. benefactor and the person, who stood surety either through execution of personal guarantee or creation of mortgage charge. The expression Mortgagor and Mortgagee though not defined in the Ordinance, 2001 and re-enacted Section 15 would be interpreted in the light of the principle of literal Rule of interpreta tion by giving the expressions plain meaning. Therefore, Mortgagor is a surety-cum-customer , who has executed mortgage documents for creation of mortgage against immovable property for securing payment of mortgage money and against whom remedy under re-enacted section 15 can be invoked provided conditions prescribed are met. In nutshell, the remedy provided to the financial Institution under re-enacted section 15, in addition to other remedies, is with reference to the bargain / transaction negotiated by way of creation of mortgage charge on immovable property for securing the amount subject matter thereof. In these circumstances, irrespective of confusion qua nomenclature of the customer , either benefactor or surety , the remedy can be invoked if there is a transaction of mortgage executed and conditions provided are met. The Mortgagor , therefore, for the purposes of re-enacted section 15 is and shall be treated as customer .

Now, what would be the scenario in case s, where benefactor of finance may be one person and surety , executant of mortgage documents, is another person? If the finance extended is not secured through mortgage charge, the financial institution may invoke the remed y under section 9 for the purposes of establishing default in the fulfillment of any obligation with regard to finance and remedy under re-enacted section 15 is non-existent. And in case where finance extended to benefactor is secured through third party mortgage (surety), the financial institution may invoke remedy under re-enacted section 15 against said surety , being a customer by virtue of transaction of mortgage.

The definition of the customer has to be interpreted and construed accordingly with reference to the subject and context. The re-enacted section 15 is not happily worded and has to be construed cautiously and harmoniously to protect the law. Guidance is solicited from the judgment by the Apex Court in the case of PAKIST AN TELECOMMUNICA TION AUTHORITY (PTA) ISLAMABAD through Chairman v. PAKIST AN TELECOMMUNICA TION COMP ANY LIMITED, HEADQUAR TERS, G-8 MARKAZ, ISLAMABAD (2016 SCMR 69), relevant portion whereof is reproduced hereunder as; "It is an ancient and consistently applied principle of Interpretation of statutes that where "object and intention of statute is clear it must not be reduced to a nullity by the draftsman' s unskillfulness or ignorance" (The Interpretation of Statutes 7th Edition by Sir Peter Mexwer".

38. Another submission of petitioner 's counsel that unless default of the Customer is judicially ascertained and determined under section 9 of the Ordinance, no proceedings can be initiated under section 15(2) of Ordinance, 2001, is misconceived. The expression "in case of default of payment by the customer " employed in sub section

(2) of re-enacted section 15 and the expre ssion "where a customer or a financial instit ution commits a default in fulfillment of any obligation with regard to any finance" in section 9 of Ordinance, 2001, are mutually exclusive, convey different connotations, applicable to distinguishable circumstances and cater for distinct transactions; one regarding determination of default in fulfillment of obligation with regard to documents relating to grant of finance and other in respect of documents securing repayment of mortgage money . The expression "fulfilment of any obligation with regard to any finance" in section 9-ibid, is conspicuous by its absence in re- enacted section 15, which distinction in two sections/methods of recovery is mean ingful and subject of intelligible differentia, discussed earlier . Under re-enacted section 15, claim is not with regard to finance but recovery of money secured through mortgage, which distinction is pivotal. The intention of the legislature while using the expression 'default of payment' in sub-section (2) of re-enacted section 15 in the context of customer merely manifest "ipse dixit assertion or statement of failure" by the Mortgagee for the purposes of invoking remedy under re-enacted section 15, which self-proclaimed failure does not require judicial determination, adjudication or pronouncement in terms of section 9 of Ordinance, 2001 at that stage. Subjecting the remedy provided to the Mortgagee, with respect to distinctively designed and commercially tailored contractual arrangement inter-se Mortgagor and Mortgagee, to an adjudicatory mechanism provided under section 9 would sabotage Legislative intent and defeat the purpose of re-enacted section 15. Such a construction would render re-enacted Section 15 superfluous and redundant. The Mortgagor , either a benefactor of finance or a person who mortgaged immovable property for securing repayment of mortgage money , has contractually committed or undertaken to pay mortgage money upon demand by the Mortgagee. The purpose and intent of peculiar transaction of mortgage has to be understood, acknowledged and construed accordingly while understanding the spirit and objective of re-enacted section 15. It is evident from the Mortgag e documents placed on record through application bearing C.M. No.8 of 2019, that the petitioner / Mortgagor represented and committed to pay the amounts, subject matter of documents, on demand which promise to pay constitute an independent commitment. No claim, whatsoever , other than the claim against the mortgagor is maintainable or entertained under re-enacted section 15. The liability incurred or committed by the mortgagor is independent, who is obligated to pay the mortgage money on demand, in exercise of right to redeem, failing which mortgage can be enforced by the mortgagee, upon invoking statutory powers extended under re-enacted section 15.

39. Learned counsel for the petitioners have referred to a Full Bench judgment of this Court in the case of "Mian Ayyaz Anwar" (supra) to emphasize that default has to be determined by the Banking Court exclusively , claiming that ratio thereof is also applicable to mortgage transactions. We have examined the judgment in the case of Mian Ayaz Anwar (supra), wherein it was held that "FIO is a special law which gives exclusive jurisdiction to the Banking Court to establish whether or not there has been a "default" by the customer in fulfilment of any "obligation" with regard to any finance as defined under section 2 of the FIO. The definition of "obligation" as given under the FIO includes a vast number of situations which tantamount to a breach and includes the issue of determining whether any amounts are due to the financial institution. Since the Banking Court has exclusive jurisdiction to determine the question of "default" it also has the exclusive jurisdiction to try the offence of "willful default" under section 20 of the FIO". The question before us is not regarding the determination of default qua fulfillme nt of any obligation with regard to finance but question of constitutionality of re-enacted section 15, which provides procedure and mechanism for enforcement of peculiar claims against the mortgagor for the recovery of mortgage money . The questions raised and issues adjudicated upon in the case of Mian Ayaz Anwar (supra) are different.

Notwithstanding self-proclaimed declaration of default of payment and issuance of statutory notices by the financial Institution / Mortgagee - subject to verification and determination of liability by the Chartered Accountant - under sub-section (2) of re-enacted section 15, still the jurisdiction to determine and decide all such disputes, arisen upon issuance of statutory notices, vests with the Banking Court. The Mortgagor-cum-customer may always invoke the remedies provided under the Ordinance, 2001 to challenge the validity of the notices and claim of outstanding mortgage money raised therein, subject to the requirements and conditions prescribed under re-enacted section

15. No fundamental right would be infringed, or any prejudice caused to the Mortgagor upon issuance of notices, merely upon "ipse dixit assertion or statement of default", when remedies are available to the Mortgagor to question such declaration of default before publication of terms of sale. The self proclaimed default by the Mortgagee does not adversely affect the rights and remedies available to the Mortgagor , which addresses the concern regarding compliance of Article 10-A of the Constitution, 1973. It is reiterated that remedies are available and can be invoked accordingly , whereupon the Banking Court may adjudicate upon, depending upon the nature of the claim. Re- enacted Section 15 has not narrowed down or curtailed the scope of remedies rather regulated them, which exercise of discretion by legislature is not unconstitutional.

40. There is another aspect of the matter. Re-enacted section 15 is otherwise a special provision having non- obstante effect - and is to be interpreted accordingly . The time-tested principle that 'special provisions will control general provisions stood affirmed and reference is made to the case of "Brig. SHER ALI BAZ and another v. THE SECRET ARY ESTAGLISHMENT DIVISION and others" (PLD 1991 SC 143), relevant portion whereof is reproduced hereunder: "17. There is a very well entrenched principle of interpretation of statutes and statutory instruments and it is Generalia specialiabus non derogant meaning 'General words do not derogate from special provisions, or, 'special provisions will control general provisions'. This principle of interpretation found recognition in Fitzgerald v.

Companies (2J & H 31,54) quoted with approval in Re Smith's state, Clements v. Ward, 35 C Marbury v. Plowman, 16 CLR 468,473 by Wood VC in the following words: In passing the special Act, the Legislature had their attention directed to the special case which the Act was meant to meet, and considered and provided for all the circumstances of that special case; and, having so done, they are not to be considered by a general enactment passed subsequently , and making no mention of any such intention, to have intended to derogate from that which, by their own special Act, they had thus carefully supervised and regulated."

[Emphasis supplied] Reference is also made to decision in the case of "NEIMA T ALI GORA YA and 7 others v. JAFF AR ABBAS, INSPECT OR/SEARGEANT TRAFFIC through S.P., Traffic, Lahore and others" (1996 SCMR 826), relevant portion whereof is reproduced hereunder as; "It is well-settled principle of interpretation that whereas general law as well as special law applied to a particular case then to the extent of application of special law in that case the provisions of general law stand displaced. Rule 8 of the Rules of 1974 referred by the learned counsel for the respondents, is a general provision of law applicable to all directly recruited civil servants in Punjab for determining their seniority inter se while rule 12.2(3) of the Rules, which also deals with the same subject, is applicable only to a specific category of civil servants, namely , members of Police Force. Rule 12.2(3) of the Rules , therefore, is a special provision of law while rule 8 of the Rules of 1974 is a general provision of law, both dealing with the same subject. The former being applicable to a specific category of civil servants, while the latter is applied to the whole body of civil servants in Punjab. Therefore, if the provision of rule 12.2(3) of the Rules applied to a case, to that extent rule 8 of the Rules of 1974 will be inapplicable".

[Emphasis supplied]

41. One cannot undermine the connotation and effect of the expression "where the mortgagor fails to pay the amount as demanded within the period prescribed under sub-section (2)" used in sub-section (4) of section, having special significance for the purposes of ascertaining default or failure of the mortgagor , in the context of re-enacted section 15. The default of the mortgagor would be reckoned or triggered upon its failure to pay the outstanding mortgage money in terms of statutory notices issued or failure to invoke remedies provided, subject to the conditions prescribed.

42. Before proceeding further to examine the question of validity of the Rules, 2018, we would like to refer to various judgments, from our as well as neighbouring jurisdiction, to underscore the conventional jurisprudence with regard to the determination of constitutio nality or otherwise of the statutes, particularly statutes dealing with tax, financial and economic matters. A reference is aptly made to the case of "Messrs ELAHI COTT ON MILLS LTD. and others v. FEDERA TION OF PAKIST AN through Secretary , M/o Finance, Islamabad and 6 others" (PLD 1997 SC 582 ), relevant portion whereof is reproduced hereunder: "31. From the above case-law and the treatises, inter alia the following principles of law are deducible:-- i) That in view of wide variety of diverse economic criteria, which are to be considered for the formulation of a fiscal policy , Legislature enjoys a wide latitude in the matter of selection of persons, subject-matter , events, etc. for taxation. But with all this latitude certain irreducible desiderata of equality shall govern classification for differential treatment in taxation law as well. ii) That Courts while interpreting laws relating to economic activities view the same with greater latitude than the laws relating to civil rights such as freedom of speech, religion etc., keeping in view the complexity of economic problems which do not admit of solution through any doctrinaire or strait jacket formula as pointed out by Holmes, J. in one of his judgments.

43. The principles regarding presumption of validity of laws, as developed in our neighbouring jurisdiction are elaborated in recent judgment, reported as "STATE OF M.P. v. RAKESH KOHLI and another" (2013 SCMR 34).

Relevant portions at pages 41, 42 and 47, whereof are reproduced hereunder as; "14. This Court has repeatedly stated that legislative enactment can be struck down by Court only on two grounds, namely (i), that the appropriate Legislature does not have competency to make the law and (ii), that it does not take away or abridge any of the fundamental rights enumerated in Part-III of the Constitution or any other constitutional provisions.

15. In McDowell and Co., (AIR 1996 SC 1627: 1996 AIR SCW 1679) while dealing with the challenge to an enactment based on Article 14, this Court stated in paragraph 43 (at pg. 737) of the Report as follows (Para 45 of AIR, AIR SCW):-- "........ A law made by Parliament or the legislature can be struck down by courts on two grounds and two grounds alone, viz., (1) lack of legislative competence and (2) violation of any of the fundam ental rights guaranteed in Part III of the Constitution or of any other constitutional provision. There is no third ground ........

"............ if an enactment is challenged as violative of Article 14, it can be struck down only if it is found that it is violative of the equality clause/equal protection clause enshrined therein . Similarly , if an enactment is challenged as violative of any of the fundamental rights guaranteed by clauses (a) to (g) of Article 19(1), it can be struck down only if it is found not saved by any of the clauses (2) to (6) of Article 19 and so on. No enactment can be struck down by just saying that it is arbitrary or unreasonable . Some or other constitutional infirmity has to be found before invalidating an Act. An enactment cannot be struck down on the ground that court thinks it unjustified . Parliament and the legislatures, composed as they are of the representatives of the people, are supposed to know and be aware of the needs of the people and what is good and bad for them. The court cannot sit in judgment over their wisdom".......

24. In Hamdard Dawakhana and another v. The Union of India and others AIR 1960 SC 554, inter alia, while referring to the earlier two decisions, namely , Bengal Immunity Com-pany Ltd., (AIR 1955 SC 661) and Mahant Moti Das, (AIR 1959 SC 942) it was observed in paragraph 8 (at pg. 559) of the Report as follows:-- "8. Therefore, when the constitutionality of an enactme nt is challenged on the ground of violation of any of the articles in Part III of the Constitution, the ascertainment of its true nature and character becomes necessary i.e. its subject-matter , the area in which it is intended to operate, its purport and intent have to be determined. In order to do so it is legitimate to take into consideration all the factors such as history of the legislation, the purpose thereof, the surrounding circumstances and conditions, the mischief which it intended to suppress, the remedy for the disease which the legislature resolved to cure and the true reason for the remedy ."

29. While dealing with constitutional validity of a taxation law enacted by Par liament or State Legislature, the court must have regard to the following principles: (i), there is always presumption in favour of constitutionality of a law made by Parliament or a State Legislature (ii), no enactment can be struck down by just saying that it is arbitrary or unreasonable or irrational but some constitutional infirmity has to be found (iii), the court is not concerned with the wisdom or unwisdom, the justice or injustice of the law as the Parliament and State Legislatures are supposed to be alive to the needs of the people whom they represent and they are the best judge of the community by whose suffrage they come into existence (iv), hardship is not relevant in pronouncing on the constitutional validity of a fiscal statute or economic law and (v), in the field of taxation, the Legislature enjoys greater latitude for classification.

[Emphasis supplied] Reference is also made to the case of "R. K. Karanjia v. Union of India" (AIR 1981 SC 2138) , relevant portion at page 2146 is reproduced as;

7. "Now while considering the constitutional validity of a statute said to be violative of Article 14, it is necessary to bear in mind certain well established principles which have been evolved by the Courts as rules of guidance in discharge of its constitutional function of judicial review . The first rule is that there is always a presumption in favour of the constitutionality of a statute and the burden is upon him who attacks it to show that there has been a clear transgression of the constitutional principles . This rule is based on the assumption, judicially recognized and accepted, that the legislature understands and correctly appreciates the needs of its own people, its laws are directed to problems made manifest by experience and its discrimination are based on adequate grounds. The presumption of constitutionality is indeed so strong that in order to sustain it, the Court may take into consideration matters of common knowledge, matters of common report, the history of the times and may assume every state of facts which can be conceived existing at the time of legislation.

8. Another rule of equal importance is that laws relating to economic activities should be viewed with greater latitude than laws touching civil rights such as freedom of speech, religion etc."

[Emphasis supplied]

44. While applying the test of constitutionality , when contextualized in light of "Elahi Cotton Mills" case (supra) and the cases from neighbouring jurisdiction, we are of the opinion that re-enacted section 15 has been competently enacted and is in accord with fundamental rights guaranteed.

45. We now examine the question of validity of the Rules, 2018. There is no cavil that rule making power was assigned in terms of section 25 of the Ordinance, 2001 and sub-section (5) of re-enacted section 15. It is argued that rules framed exceeded the scope and extent of the Ordinance, 2001 and re-enacted section 15. We repel the submissions. The Federal Government has framed rules in exercise of powers under section 25 of the Ordinance, 2001, which inter alia include procedures for determination of liability [rule 3(a)], valuation of property [(rule 3(b)] and bidding process [rule 3(c)]. The purpose and objectives of the Rules, 2018 is, inter alia, provisioning of procedures for the mode, conduct and method of sale of mortgaged property , in addition to the conditions mentioned in sub-section (4) of section 15. Perusal of procedural requirem ents introduced would show reinforcement of rights extended to the mortgagors under re-enacted section 15, which procedural requirements in fact places additional obligations/duties on the financial institutions, reason being to counterbalance the rights extended to the mortgagee, which is allowed to issue notices without the intervention of the court, at that point in time [despite provisioning of remedies to the mortgagor]. The conditions / procedural requirements of seeking determination of outstanding mortgage money by the Chartered Accountant - selection criterion discussed in Rule 3(a)(i) of Rules, 2018 - before issuance of first demand notice has been provided in the Rules,2018. Learned counsel for the petitioners submits that seeking determination of outstanding mortgage money is prejudicial to the rights of the mortgagors. We tend to disagree with the submissions. The mechanism provided for determination of outstanding mortgage money through Chartered Accountants creates another tier of check on the powers of the Mortgagee / financial Institutions and would bring more transparency , fairness and lend credence to the actions of the financial institutions. The determination of outstanding mortgage money by Chartered Accountant do not in any manner curtail or prejudice the rights or remedies of the mortgagor , who may still dispute such determination by invoking the jurisdiction of the Banking Courts under sub-section (13) of section 15, subject to the conditions prescribed. It is suffice that adequate remedies are available under re-enacted section 15 before an adverse action or decision is taken or given effect, notw ithstanding determination of amounts by the Chartered Accountants. The critical question is that what prejudice would be caused to the Mortgagor upon determination of amounts by Chartered Accountants? The mortgagor has adequate opportunity to question such determinations at the earliest stage, upon issuance of first notice. We do not find any illegality in the requiremen t of seeking an endorsement by the Chartered Accountants. The apprehensions regarding arbitrary discretion conferred on the Chartered Accounts and concern regarding exaggerated claims - as the expression mortgage money , inter alia, included penalties, damages, charges or pecuniary liabilities, would extend unfettered authority to the financial institutions to inflate or exaggerate alleged claim - are misconceived. It is clearly provided in clause (b) of sub-section (1) of section 15 that 'mortgage money' is the amount, "payment of which is secured for the time being by the document by which the mortgage is effected or evidence, including any mortgage deed or memorandum of deposit of title deeds". We repel the submissions that Chartered Accountants can determine the Cost of Funds, which submissions are misconceived and in clear violation of section 3 of the Ordinance, 2001. We do not find any defect in the exercise of powers to frame Rules, 2018, which otherwise cause no prejudice to the mortgagors - who are at liberty to object to the determination of outstandin g mortgage money by the Chartered Accountants or evaluation of the mortgaged property by the evaluators. The Rules have to be interpreted in the context of the purpose and object of the enactment. Reference is made to case of "KARACHI BUILDING CONTROL AUTHORITY and 3 others v.

HASHW ANI SALES AND SERVICES LIMITED and 3 others" (PLD 1993 S.C 210) - wherein reliance has been placed on the case of "Maharashtra S.B.O.S. and H.S. Education Vs. Paritosh, (S.C)" (AIR 1984 S.C 1543). It is appropriate to reproduce relevant portio n in the case of "Karachi Building Control Authority and 3 others , at pages 227 and 228, which reads as:- "The Indian Supreme Court, while examining the question of vires of Regulation 104 framed by the Maharashtra Secondary and Higher Secondary Education Board under Act 41 of 1965, dilated on the question as to how the issue of vires, of a Regulation or a Rule is to be approached or to be examined by a Court. Relevant observations read as follows:- "In our opinion, this approach made by the High Court was not correct or proper because the question whether a particular piece of delegated legislation --- whether a rule or regulation or other type of statutory instrument --- is in excess of the power of subordinate legislation conferred on the delegate is to be determined with reference only to the specific provisions contained in the relevant statute conferring the power to make the rule, regulation, etc. and also the object and purpose of the Act as can be gathered from the various provisions of the enactment. It would be wholly wrong for the Court to substitute its own opinion for that of the legislature or its delegate as to what principle or policy would best serve the objects and purposes of the Act and to sit in judgment over the wisdom and effectiveness or otherwise of the policy laid down by the regulation-making body and declare a regulation to be ultra vires merely on the ground that, in the view of the Court, the impugned provisions will not help to serve the object and purpose of the Act. So long as the body entrusted with the task of framing the rules or regulations acts within the scope of the authority conferred on it, in the sense that the rules or regulations made by it have a rational nexus with the object and purpose of the Statute, the Court should not concern itself with the wisdom or efficaciousness of such rules or regulations. It is exclusively within the province of the legislature and its delegate to determine, as a matter of policy , how the provisions of the Statute can best be implemented and what measures, substantive as well as procedural, would have, to be incorporated in the rules or regulations for the efficacious achievement of the objects and purposes of the Act. It is not for the Court to examine the merits or demerits of such a policy because its scrutiny has to be limited to the question as to whether the impugned regulations fall within the scope of the regulation-making power conferred on the delegate by the Statute. Though this legal position is well- established by a series of decisions of this Court, we have considered it necess ary to reiterate it in view of the manifestly erroneous approach made by the High Court to the consideration of the question as to whether the impugned clause (3) of Regulation 104 is ultra vires. In the fight of the aforesaid principles, we shall now proceed to consider the challenge leveled against the validity of the Regulation 104(3)."

The other authorities relied upon by Mr. Virjee inter alia lay down that there is a presumption that Regulations or the Rules framed under the statutory power are valid. While examining the question of vires of the statutory regulations or rules, the Court should make efforts to uphold them as valid. Liberal construction should be placed on such regulations/rules and the paramount consideration should be public interest and public good etc. There cannot be any cavil to the above legal propositions nor there can be any controversy on the correctness of the weighty observations of the Indian Supreme Court quoted hereinabove from the case of Maharashtra State Board of Secondary and Higher Secondary Education and another v. Paritosh Bhupesh Kumarsheth, etc. (supra). Once a Court finds that the regulations/rules framed under the statutory power are within the ambit of the relevant statute, it cannot sit in judgment over the wisdom and effectiveness or otherwise of the policy laid down by the regulations making body and it cannot declare regulations to be ultra vires merely because the Court considers that the impugned regulations will not serve the object and the purpose of the Act".

[Emphasis supplied]

46. We have serious reservations regard ing Rule-3 (c) (iv) of Rules, 2018 wherein even in the presence of one bidder the financial institution can proceed with the auction sale. It is expedient to reproduce Rule 3 (c) (iv), which read as; "iv) If on the bidding day, only one bidder with the offer equal to or more than the reserve price of the mortgaged property comes forward, the financial institution may proceed to sell the mortgaged property to such bidder".

The mechanism provided is against the very concept of the public auctions. Re-enacted section 15 repeatedly refers to public auction, even the Rules, 2018, used the expression "public auction". The word auction is explained in Black' s Law Dictionary-1 1th Edition, which means "a public sale of property to the highest bidder; a sale by consecutive bidding, intended to reach the highest price of the article through competition for it". The expression "offer equal to - or more than the reserve price" in Rule 3 (c) (iv), further sabotage conventional wisdom and jurisprudence developed, - reaffirmed by the Courts through numerous judicial pronouncements - that reserve price is only a base price or a starting price. And allowing a bidder to bid for the property by merely offering bid equal to reserve price is negation of concept of ascending price auction i.e. each subsequent bid is required to be higher than the previous bid. In view of the above, the Rule under reference is unconstitu tional, it negates the mandate of Article 24 of the Constitution, 1973, and same is contrary to the spirit of public auctions and competitive bidding.

We hold that Rule-3 (c) (iv) of Rules, 2018 is ultra-vires and contrary to the mandate of re-enacted section 15.

Applying the principle of severability of statutes, we sever Rule - 3 (c) (iv) of Rules , 2018 from the remaining Rules and preserve the operation and applicability of remaining Rules. Guidance is sought from the ratio in the case of "BAZ MUHAMMAD KAKAR and others v. FEDERA TION OF PAKIST AN throug h Ministry of Law and Justice and others" ( PLD 2012 SC 923 ), also referred in the case of "SAF Textile Mills Limited (supra).

47. It is permissible for the financial institution to participate and bid, subject to the conditions prescribed. The mortgagor may invoke remedies against collusive, fraudulent and manipulative sales before the Banking Courts, which may proceed in accordance with the requirements and conditions presc ribed. The remedy of grant of compensatory damages was not available in original section 15, which is an additional bulwark available against unscrupulous, fraudulent and manipulative sales.

48. The judgments referred by respondents No.3 and 5 discussing the legality of mechanism / remedy of non- judicial sales do not need any elaboration. We hold that non-judicial sales are not illegal per se. The judgments by respondent No.4 also need no reiteration, which are discussed in earlier part of the judgment. The judgment in the case of "Mst. Imrana Tiwana" (supra) discussed the principles for testing the validity of statutes/ enactments, which test is met by re-enacted section 15. The judgments relied upon by the counsel for the petitioners and relevant for the purposes of this case are discussed hereunder . The ratio in the case of Shahid Pervaiz (supra) is not attracted in the absence of breach of constitutional principles upon promulgation of re-enacted section 15. The case of Contempt Proceedings against Chief Secretary Sindh and others (supra) is not applicable, as the reasons cited for declaring Original section 15 as unconstitutional were addressed by the legislature while re-enacting section 15, which now meets the test of constitutionality . The case of Saudi-Pak Industrial Agricultural Investme nt Company , Pvt. Ltd., Islamabad (supra) primarily discussed principle of construction of contract of guarantee, which is not relevant. The case of Jehangir Mehmood Cheema (supra) relates to placement of name on Exit Control List, wherein question of default was discussed in different context. The case of Muhammad Jamshed (supra) pertains to election matter and question of default was discussed in said context. The case of Messrs Summit Bank Limited through Manager Ltd. (supra) is distinguishable as re-enacte d section 15 only provides remedy to recover mortgage money in terms of re-enacted section 15 and there is no question of conferring judicial powers. The case of Agricultural Development Bank of Pakistan and another (supra) relates to the recovery of amounts due as arrears of land revenue without determination, no question of enforcement of mortgage was involved therein. The Case of "A & A SERVICES through Proprietor v. FEDERA TION OF PAKIST AN through Secretary Ministry of Finance and others" (2014 CLD 809) relates to Credit Information Bureau matter and has no relevance. The facts in the case of Zakaria Ghani and 4 others (supra) are distinguishable. Re-enacted section 15 otherwise provides rights and remedies to the mortgagor against auction sales conducted thereunder . The facts in the case of Abdul Jabbar Shahid and others (supra) are distinguishable and extend no assistance regarding determination of constitutionality or otherwise of re-enacted section 15. The case of Muhammad Khalil (supra) deals with the question of conduct of auction and confirmation thereof, which issue is not relevant for the purposes of deciding the question before us. Other judgments are not relevant. There is no violation of constitutional principles or guarantees regarding fundamental rights, including but not limited to Article 10-A of the Constitution, 1973. We have already discussed the concept of non -judicial sales. With respect to the submissions in pending cases, the customers / mortgagors, upon issuance of notices under re-enacted section 15, may seek indulgence of the Banking Courts - wherein matters are pending - for seeking relief in terms of reme dies provided under re-enacted section 15, once proceedings in terms of re-enacted section 15 are initiated.

49. We agree with the submission of Additional Attorney-General for Pakistan that the remedy under section 22 (6) includes order passed under subsection (12) of section 15. It appears to be an inadvertent omission which can be rectified. Reference is placed on the case reported as "Malik Muzaffar Ahmad" (supra). We hold that sub-section

(12) of section 15 be read in place of sub-section (11) of section 15 in section 22 (6) of Ordinance, 2001, for all intent and purposes.

50. Re-enacted section 15 no doubt confers power of sale upon the failure of the mortgagor to pay mortgage money when demanded, but also imposes conditions to be met before power of sale is exercised - issuance of notices and conditions prescribed for the mode, conduct and method for sale of the mortgaged properties, adherence whereof shall be strictly requi red before right to redeem is lost / extinguished and unassailable title in the property is conveyed unto the purchaser .

51. In view of the aforesaid, we hold that re-enacted section 15 and Rules, 2018 [except Rule -3 (c) (iv)], are intra- vires and Constitutional, and to that extent petitions are dismissed. We further hold that Rule-3 (c) (iv) of Rules, 2018 is unconstitutional and ultra-vires the Ordinance, 2001, and re-enacted section 15. The challenge, to the extent of Rule - 3 (c) (iv) of Rules, 2018, is successful and petitions are allowed to said extent only. No order as to costs.

ABID AZIZ SHEIKH, J. I have respectfully gone through the proposed Judgment authored by my learned brother Asim Hafeez, J. With due respect, I do not agree with certain observations and findings made in the proposed Judgment. In my humble opinion (as expressed through separate dissenting note), section 15 of the Ordinance can only be invoked against "mortgagor" to recover mortgage money , if default in payment by "customer" is determined and established by Court under section 9 of the Ordinance. Further in my opinion, rule 3(iii) of the Rules is also beyond the scope of the Ordinance, hence ultra vires of the Ordinance and the Constitution. In view of above, I happen to dissent with majority view of my learned brothers.

DISSENTING NOTE

2. The petitioners have challenged the vires of provisions of section 15 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 ("Ordinance") (promulgated through Act 38/2016 dated 15.08.2016) and Financial Institutions (Recovery of Finances) Rules, 2018 ("Rules") framed under section 25 of the Ordinance. The detailed facts and respective arguments of the parties are already aptly elaborated in the proposed Judgment, hence need not be reiterated. However to understand the background, it is relevant to note that section 15 of the Ordinance was earlier promulgated as part of the original Ordinance. The said provision was challenged being ultra vires of the Constitution of Islamic Republic of Pakistan, 1973 ("Constitution"). The learned Full Bench of this Court through Judgment reported Muhammad Umer Rathore vs. Federation of Pakistan (2009 CLD 257) declared the provisions of section 15 of the Ordinance to be ultra vires of the Constitution and in conflict with the fundamental rights. In appeal, the honourable Suprem e Court vide Judgment reported National Bank of Pakistan and 117 others vs. SAF Textile Mills Ltd. and another (PLD 2014 SC 283) held the provisions of section 15 of the Ordinance to be ultra vires of the Constitution, however , the august Supreme Court did not agree with the findings of learned Full Bench of this Court that "sale of mortgaged property without intervention of the Court is per se unconstitutional".

3. After section 15 of the Ordinance was declared unconstitutional by this Court as well as by honourable Supreme Court in above referred judgments, the provision of section 15 of the Ordinance was substituted by a new provision of section 15 of the Ordinance through Act 38/16 dated 15.08.2016. The present petitioners again challenged the vires of substituted provisions of section 15 of the Ordinance in these constitutional petitions. During pendency of these petitions, the Rules were also framed under section 25 of the Ordinance prescribing procedure to sell the mortgaged properties under section 15 of the Ordinance. The petitioners accordingly amended their writ petitions to also challenge the vires of these Rules.

4. Regarding original section 15 of the Ordinance, no doubt the honourable Supreme Court dismissed the appeal in SAF Textile case supra, however , certain findings of the learned Full Bench of this Court in Umer Rathore case were not agreed by the honourable apex Court. It is now well settled law that when an appeal against the judgment of High Court is dismissed by honourable Supreme Court, it does not follow , that the reasoning adopted by the High Court has been ipso facto approved. The honourable Supreme Court in SAF Textile case declared provisions of section 15 of the Ordinance ultra vires of the Constitution on the basis of its own reasoning recorded in said judgment. For convenience the concluding Para 45 of the SAF Textile case judgment is reproduced hereunder:- "In the light of aforesaid discussion and in terms thereof, the provisions of section 15 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 are held to be ultra vires to the Constitution of the Islamic Republic of Pakistan, 1973."

5. Indeed the honourable Supreme Court held that the sale of mortgaged property without intervention of the Court is permissible, however , procedure and mode prescribed under previous section 15 of the Ordinance was found to be against due process of law under Article 10-A and right of property under Articl e 24 of the Constitution. Further the question whether such harsh parallel system with arbitrary and unbridled power is Constitutional or otherwise was left open by honourable Supreme Court because Article 15 was already declared ultra vires.

6. Though substituted section 15(17) of the Ordinance provides a non obstante clause that provisions of section 15 shall have effect not withstanding anything contained in the Ordinance or any other law or judgment of any Court, however , it is not case of the respondent s that provision of substituted section 15 of the Ordinance is contrary to the judgment of any Court, rather their claim is that defects highlighted by honourable Supreme Court in SAF Textile case about previous section 15 of the Ordinance have been cured in substituted section 15 of the Ordinance. Therefore, at this stage, it is not necessary to examine the scope and effect of non obstante clause contained in section 15(17), which discussion however , may become necessary , if it is found that substituted provisions of section 15 of the Ordinance is in conflict with the judgment of honourable Supreme Court or this Ordinance or any other law for the time being in force. However , at this juncture, it is relevant to observe that as per well settled law, such non obstante clauses are always subject to Constitution and cannot over-ride fundamental rights guaranteed under the Constitution. Further the protection under non obstante clause is for section 15 of the Ordinance only and not to Rules framed under section 25 of the Ordinance.

7. Now we examine if substituted section 15 of the Ordinance is in line with the law settled by honourable apex Court' s judgment in SAF Textile case supra or conflict the provisions of the Constitution. For convenience, Para 33 of SAF Textile case supra is reproduced here under:- "33. The matters pertaining to the financial claims secured by mortgagors as in the instant case, generally involves a two stage process, firstly the determination of the liability through due process and after a fair trial inclusive of a right of hearing and opportunity of show cause. Such determination under the general law, is evidenced by a decree of a Court of competent jurisdiction. And secondly , the recovery of the determined amount by way of the satisfaction or execution of such decree including through the sale of mortgaged property . Even if a liability has been determined by a decree of the Court, the mortgagor/debtor is not deluded of all his civil rights including with regards to the modes and methods of such recovery through the sale of the mortgaged property . The right of such debtor to ensure that the mortgaged property is sold in a free, fair and transparent manner so as to fetch the best possible price is now a well-recognized principle of law, which finds its manifestation both in various statutory provisions, more particularly , Code of Civil Procedure (including Order XXI of C.P.C.) as well as the law, as laid down by this Court, including the case reported as Mir Wali Khan v. Agricultural Development Bank of Pakistan, Muzafargarh and another ( PLD 2003 SC 500 ).

8. As per law settled by Hon'ble Supreme Court in Para 33 of SAF Textile case , the matters pertaining to financial claims secured by mortgagors generally involves two stage process. Firstly , the determination of liability through due process and after fair trial inclusive of right of hearing and opportunity of show cause and such determination under general law is evidenced by decree of Court of competent jurisdiction and secondly recovery of determined amount by way of satisfaction or execution of such decree including through sale of mortgaged property . The above observation by Hon'ble Supreme Court shows that there must be due process of law at both stages i.e. firstly at the time of determination of liability and secondly at the time of recovery of said determined amount. The impugned provision of section 15 of the Ordinance is to be examined in above context. In case, it is found that due process is not followed at any of the two stages, than provision will not be sustainable in view of Article 10-A of the Constitution. However , if the due process is available at both stages, then the provision will be intra vires of the Constitution.

9. The plain reading of section 15(2) of the Ordinance shows that in case of default for payment by a "customer", financial institution may send a notice to the "mortgagor" demanding payment of mortgage money . For ready reference, the provision of section 15(2) of the Ordinance is reproduced hereunder:- "(2). In case of default in payment by a customer , the financial institution may send a notice on the mortgagor demanding payment of the mortgage money outstanding, within fourteen days from service of the notice, and failing payment of the amount within due date, it shall send a second notice of demand for payment of the amount within fourteen days. In case the customer on the due date given in the second notice sent, continues to default in payment, financial institution shall serve a final notice on the mortgagor demanding the payment of the mortgage money outstanding within thirty days from service of the final notice on the customer ."

(emphasis supplied).

The above provision of section 15(2) of Ordinance explicitly shows that to trigger the provision of section 15 of the Ordinance, the determination of default of payment on part of the customer is a condition precedent. Section 9 of the Ordinance provides a procedure for filing of suit against the customer where he commits default in fulfillment of any obligation with regard to finance. The definition of word "customer" under section 2(c) of the Ordinance does not specifically include the mortgagor . However , the Division Bench of this Court in RFA No.1004/201 1 titled Mrs. Tayyaba Jabeen etc. vs. Saudi Pak Industrial and Agricultural Investment Company Limited, held that suit under section 9 of the Ordinance is also maintainable against the mortgagor . Further under section 14 of the Ordinance, where suit is for the enforcement of immoveable property , the Court can pass an interim or final decree for foreclosure or sale of mortgaged property . The above provision shows that where in suit filed against customer , default is determined by Court under section 9 of the Ordinance and financial institution has not filed execution for the foreclosure and sale of mortgaged property in pursuant to decree issued under section 14 of the Ordinance, the said financial institution can invoke the provision of section 15 of the Ordinance. This interpretation of section 15 of the Ordinance will provide the due process with the intervention of Court for the "determination of liability" against the customer , before invoking the provision of section 15 of the Ordinance against mortgagor . Any other interpretation of section 15 of the Ordinance will render the provision ultra vires of Article 10-A of the Constitution as there will be no due process in determination of the liability against customer before invoking section 15 of the Ordinance against the mortgagor .

10. The above interpretation is also in consonance with the settled law that when two constructions are reasonably possible, then preference should be given to one which helps to carry out beneficial purpose of the Ordinance and ensue smooth and harmonious working of the Constitution and eschew the other which will lead to absurdity and make the fundamental right nugatory . The above interpretation is also supported by subsection (3) of section 3 of the Ordinance, which is reproduced hereunder:- 3.Duty of a customer:-

(3) For purposes of this section a judgment against a customer under the Ordinance shall mean that he is in default of his duty under sub-section (1), and the ensuing decree shall provide for payment of the cost of funds as determined under sub-section (2).

According to section 3(3) of the Ordinance, a judgment against a customer under the Ordinance, shall mean that he is in default of his duties.

11. In this context, rule 3(iii) of the Rules is also relevant, which is reproduced hereunder:-

3. Procedure for sale of mortgaged property .- --A financial institution shall observe the following procedure to sell the mortgaged property under section 15 of the Ordinance, namely:-

(iii) after seven days due notice to the parties, the chartered accountant firm shall examine the accounts and determine the extent of liability of the customer including cost of funds as per sub-section (2) of section 3 of the Ordinance and submit its report to the financial institution within thirty business days from the date of the appointment; (emphasis supplied).

The above rule shows that after seven days of due notice to the parties, the Chartered Accountant will determine the liability of customer including cost of funds under section 3(2) of the Ordinance. This means that liability of the customer must be determined before property of the mortgagor can be auctioned under section 15 of the Ordinance. However , aforesaid rule on face of it, is ultra vires of the Ordinance as there is no such authority devolved upon the Chartered Accountant under the Ordinance to determine the liability of the customer or cost of fund under section 3(2) of the Ordinance, which is the exclusive domain of Court under section 9 of the Ordinance.

It is settled law that rules which are beyond the scope of the Ordinance are not sustainable. Further under section 15 of the Ordinance, notices are only to be issued to the mortgagor for recovery of mortgage money and no notice is to be given to the customer for determination of his default by Chartered Accountant under the Rules.

12. The Full Bench of this Court in Mian Ayaz Anwar and others vs. State Bank of Pakistan and others (2019 CLD 375) also held that the default of a customer can only be determined by the Court. Relevant Para of the judgment is reproduced hereunder:- "In terms of these findings, the FIO is a special law which gets priority over the ORBO, the Cr.P.C. and the P.P.C. to try the same offence, hence the Banking Court has exclusive jurisdiction to try such cases. On the same analogy the FIO will have exclusive jurisdiction to try the offence of "willful default" where the matter is between a customer and a financial institution. In terms of section 7(4) of the FIO, the Banking Court has exclusive jurisdiction with all matters falling within its domain under the FIO. Not only does the FIO prevail on account of being promulgated later in time but also because the FIO is a special law which gives exclusive jurisdiction to the Banking Court to estab lish whether or not there has been a "defaul t" by a customer in the fulfillment of any "obligation" with regard to any finance as defined under section 2 of the FIO. The definition of "obligation" as given under the FIO includes a vast number of situations which tantamount to a breach and includes the issue of determining whether any amounts are due to the financial institution. Since the Banking Court has exclusive jurisdiction to determine the question of "default" it also has exclusive jurisdiction to try the offence of "willful default" under section 20 of the FIO. In the event that there are two different forums adjudicating or investigating on the question of "willful default" at the same time, means that there is a likelihood of conflicting judgments or findings not to mention that parallel proceedings can prejudice the rights of a customer charged for willful default against whom the issue of default is yet to be established. Hence in the context of the definition given in section 2(g)(i) of the FIO, "willful default" is an intentional failure to pay that which is due to the financial institution. In all such cases, the element of "default" precedes the criminality of the offence of willfulness, meaning thereby that the question of default must be established first as per the prescribed procedure under the FIO, before it can be alleged that the default was deliberate or intentional."

(emphasis supplied).

13. In case, the above interpretation of section 15 of the Ordinance is not followed , the impugned provision will not only become harsh, unreasonable, unstructured but will also give arbitrary and unbridled discretion to the financial institutions to discriminate and adopt against certain customers, recovery process under section 15 directly without first determination of default under section 9 of the Ordinance and against other customers through execution of the decree passed under section 9 of the Ordinance. The honourable Supreme Court in Para 43 of SAF Textile case supra specifically pointed out this unstructured discretion with the Financial Institutions as under:-

43. The aforesaid contentions need to be examined in the context that the Ordinance of 2001 perceives to two parallel methods of recovery of claims from mortgagors either by filing a suit for recovery under section 9 of the Ordinance of 2001 followed by a decree to be executed in terms of section 19 thereof or by simply exercising powers conferred upon the Financial Institution by section 15 of the Ordinance of 2001. The first course of action i.e. the filing of a suit and execution of the decree envisages remedies for, the mortgagor/debtor , who is entitled to raise objections and the right to have his grievance heard and redressed by way of adjudication through judicial powers of the State, while, all such rights and remedies are lost when section 15 of the Ordinance of 2001 is pressed into service. Two parallel systems are contemplated one much harsher than the other , leaving unfettered and unstructured discretion with the Financial Institution without any predetermined criterion."

Further if financial institutions are allowed to invoke section 15 of the Ordinance without determination of default under section 9 of the Ordinance, then provisions of section 9 and most of its corresponding provisions in the Ordinance, shall become redundant. If at all that was the intention of the legislation, then section 15 of the Ordinance could expressly exclude determination of default of customer under section 9 of the Ordinance, before invoking section 15 of the Ordinance.

14. The claim of the petitioners is that notwithstanding the above interpretation, the substituted impugned section 15 of the Ordinance besides being contrary to the law settled by this Court as well as by honourable apex Court in above referred judgments, is still ultra vires of the Constitution. On the other hand the stance of the respondents is that in substituted section 15, the defects highlighted by honourable Supreme Court have been cured and therefore, the substituted provisions of section 15 of the Ordinance is intra vires of the Constitution. To appreciate respective contentions of the parties, it is expedient to reproduce the provisions of original section 15 and substituted section 15 of the Ordinance after amendment in 2016 (highlighting changes) as "Appendix A" to this Judgment. Now we examine if other clauses of section 15 of the Ordinance which pertain to process of recovery , are in conflict with law settled by honourable Supreme Court and the Constitution. For convenience relevant Paras of honourable Supreme Court' s Judgment in SAF Textile case supra are reproduced hereunder:- "34. A detailed procedure is laid down including by providing opportunities to such mortgagors/debtors and others to enforce their rights through appropriate remedies. The opportunities are usually available both prior to the sale and after the fall of the hammer . Built-in safeguards have been incorporated in the terms and conditions of the sale, which are settled after affording an opportunity of hearing to the mortgagor/ debtor usually after notice under Order XXI Rule 66 of the Civil Procedure Code, 1908 and objections and suggestions of such debtor are taken into account. Once the sale has taken place, the mortgagor/debtor is granted an opportunity to object including to the mode and method in which the sale was actually conducted. This right to object in this behalf is of vital importance so as to ensure that a free, fair and transparent sale actually takes place and no sham proceedings are undertaken or a fictitious report in this behalf is filed.

35. Such objections can be filed under Order XXI Rule 90 C.P.C. and even with respect to the sales of mortgaged property , which are effected under the provisions of the Ordinance of 2001 by the Court in execution, in addition to the above, objections application under section 19(7) of the Ordinance of 2001, can be filed. It may be noted with interest that the sale does not attain finality , until such objections are decided. Even otherwise, in the absence of any such objection, under the law, the Court is vested with the inherent jurisdiction to examine the record and so as to ensure that the sale has been lawfully conducted. It is only then all rights in the mortgaged property are finally extinguished.

36. The real import and effect of section 15 of the Ordinance of 2001 is reveale d when examined in the above backdrop and the most significant aspec t of the said provision is not what is provided thereunder but what is conspicuous by its absence. The Financial Institutions have been authorized to sell a particular mortgaged property without intervention of the Court by virtue of subsection (4) of section 15 of the Ordinance of 2001. After the sale takes place (real or fictitious), a sale deed, in respect of the property is to be executed by a Financial Institution, which is authorized in this behalf by virtue of subsection (7) of section 15 of the Ordinance of 2001. Upon the registration of the sale deed, all rights title in interest of the mortgagor/debtor in the mortgaged property stand extinguished and such property vests in the purchaser free from all encumbrances, as is provided by subsection (8) of section 15 of the Ordinance. Whereafter , the Financial Institution, which has sold the mortgaged property is required to submit a proper account to the Banking Court in terms of subsection (10) of section 15 of the Ordinance of 2001. There is no provision, which perm its a mortgagor/debtor to object to the conduct of the sale after the fall of the hammer . He is in fact deprived of the right even to agitate that the alleged proceedings for sale were sham and fictitious or carried out mala fide behind closed doors.

37. No doubt subsection (11) of section 15 of the Ordinance of 2001 does refer to the resolution of disputes relating to the sale of the mortgaged property by the Banking Court. Even if an objection raised under subsection (11) of section 15 of the Ordinance of 2001, it is of no practical legal significance, as the property sold already vests in the purchaser free from all encumbrances by virtue of subsection (8) of section 15 of the Ordinance of 2001. Thus, it is clear and obvious that the real intent and purpose of the aforementioned provisions of section 15 of the Ordinance of 2001 is to deprive the mortgagor/debtor of his right to object to the mode, the conduct of the mode and method of the conduct of the sale by barring all remedies their against. In the instant case, such extinguishment of right occurs without any process let alone after due process and fair trial, as envisaged by Article 10A of the Constitution. The right in property in terms of Article 24 of the Constitution also stands bruised and offended against.

38. Should the mortgagor/debtor be aggrieved of the terms and conditions settled by the Financial Institution for such sale, he may invoke the jurisdiction of the Banking Court directly if possible or through collateral proceedings but such Court, i.e. the Banking Court or the High Court is debarred from granting any injunction, restraining the sale of the mortgaged property by virtue of subsection (12) of section 15 of the Ordinance of 2001 except upon the due fulfilment of the condition mentioned in sub-clauses (a), (b) and (c) thereof. Yet again, it has been noticed that fair and well-recognized terms and conditions and the mode and methodology of sale of mortgaged property recognized by law or by jurisprudence have been excluded from the purview of the grounds to obtain an injunction against the sale before it takes place are conspicuous by their absence. Thus, in practical legal terms, an objection perhaps may be raised but the sale will go through whereafter the same shall achieve finality by virtue of subsections (7) and (8) of section 15 of the Ordinance of 2001 referred to above and such objections would automatically fructify as no power to set aside the sale has been conferred upon the Banking Court or for that matter to the High Court. Yet again, the mortgagor/ debtor is deprived of his right to object that the auction in question was not conducted in accordan ce with the well recognized terms and conditions to ensure a fair and transparent sale so as to fetch the highest possible price and in case of violation thereof, he is left remediless. The depravation of the rights of the mortgagor/ debtor qua the terms and conditions of sale is yet against without any fair trial or due process, as envisaged by Article 10A of the Constitution.

40. As a supplement to the aforesaid, it may be noted that no doubt, some rudimentary procedure for conducting such sales is provided in subsection (4) of section 15 of the Ordinance of 2001 but yet again the time honoured and well entrenched principle of fixation of a "reserve price" is conspicuous by its absence. It is now well settled law that even where the sale is conducted by the Court a "reserve price" is essential and the absence thereof may be fatal.

In this behalf, it may be advantageous to refer to the majority judgment in the case reported as Messrs Lanvin Traders, Karachi v. Presiding Officer, Banking Court No.2, Karachi and others (2013 SCMR 1419 ), the relevant observations thereof are reproduced hereunder:-- "Agreed that the expression "reserve price" does not find mention in the relevant rule but the words used in the rule pointedly hint thereto. A sale, in its absen ce, is apt to give walkover to maneuvers to fix any price of their choice. A sale thus effected is no sale in the eye of law especially when the number of bidders is meager , which, indeed is close to nil. A superstructure of sale built on such a shaky infrastructure cannot sustain itself. Neither the buttress of limitation nor the ministerial nature of the rule can prevent it from a fall."

41. The conscious exclusion of remedies and deliberate omissions provide for a due process of conduct of sale including the absence of the necessity to fix a reserve price becomes even more significant, as the Financial Institution has been clothed with the right to purchase the property put by it to public auction at the highest bid. No permission, in this behalf, is required from any Court, as is in the normal course in terms of C.P.C. Thus, in fact, it is a Financial Institution, which is the seller , buyer , the auctioneer and the beneficiary , hence enabled to take full advantage of the misfortune of the mortgagor/debtor thereby facilitating predatory and exploitative behaviour which perhaps would not sit well with Article 3 of the Constitution.

42. In view of the above, we find ourselves unable to agree with the learned counsel qua their view of the true effect of section 15 of the Ordinance of 2001 as canvassed by them at bar. However , it may be appropriate to refer to the contentions of the learned counsel that the findings by way of the impugned judgment that a sale of mortgaged property without intervention of the Court is per se unconstitutional is not sustainable. It is their case that an alternative non-juridical remedies are recognized and well entrenched in the jurisprudence of Pakistan and in other countries, where such non-judicial remedies have withstood the test of constitutionality . In this behalf reference was made to the provisions of the Transfer of Property Act, 1882 pertaining to the mortgages and provisions of Contract Act, 1872 relating to the rights of the pledger as well as to the various provisions of law of India, United Kingdom and United States of America. Reference was also made to some judgments from foreign jurisdiction in this behalf,

15. The impugned amended provision of section 15 of the Ordinance, when perused in the light of observations made by honourable Supreme Court in Paras 34 to 42 of SAF Textile case supra, it can safely be concluded that detailed procedure for recovery of mortgage money (after determination of customer 's default by Court under section 9 of the Ordinance) comply with requirement of due process of law and observations made by honourable Supreme Court in SAF Textile case supra except rule 3(c)(iv) of the Rules. To that extent, I agree with the reasoning recorded and conclusion drawn in the proposed Judgment.

16. Consequent upon what has been discussed above, the provision of section 15 of the Ordinance is though intra vires of the Constitution, however section 15 of the Ordinance can only be invoked against mortgagor to recover mortgage money , once customer 's default is determined by the Court under section 9 of the Ordinance. Further rule 3(iii) of the Rules is beyond the scope of the Ordinance, hence is declared ultra vires of the Ordinance and the Constitution . The constitutional petitions are partly allowed accordingly .

"Appendix A"

Old Section 15 Before Amendment Act 38/2016New Section 15 after Amendment Act 38/2016

15. Sale of mortgaged property .-

(1) In this section, unless there is anything repugnant in the subject or context "mortgage"

(a) means the transfer of an interest in specific immovable property for the purpose of securing the payment of the mortgage money or the performance of an obligation which may give rise to a pecuniary liability;

(b) "mortgage money" means any finance or other amounts relating to a finance, penalties, damages, charges or pecuniary liabilities, payment of which is secured for the time being by the document by which the mortgage is ef fected or evidenced, including any mortgage deed or memorandum of deposit of title deeds; and

(c) "mortgaged property" means immovable property mortgaged to a financial institution.15. Sale of mortgaged property .__

(1) In this section, unless there is anything repugnant in the subject or context

(a) "mortgage" means the transfer of an interest in specific immovable property for the purpose of securing the payment of the mortgage money or the performance of an obligation which may give rise to a pecuniary liability;

(b) "mortgage money" means any finance or other amounts relating to a finance, penalties, damages, charges or pecuniary liabilities, payment of which is secured for the time being by the document by which the mortgage is effected or evidenced, including any mortgage deed or memorandum of deposit of title deeds;

(c) "mortgaged property" means immovable property mortgaged to a financial institution; and

(d) "reserve price" means forced sale value of the mortgaged property determined by a reputable valuation company under clause (a) of subsection (4).

(2) In case of default in payment by a customer , the financial institution may send a notice on the mortgagor demanding payment of the mortgage money outstanding within fourteen days from service of the notice, and failing payment of the amount within(2) In case of default in payment by a customer , the financial institution may send a notice on the mortgagor demanding payment of the mortgage money outstanding within fourteen days from service of the notice, and failing payment of the amount within due date, it shall send a second notice of demand for payment of the amount within fourteen days. In case the customer on the due date given in the second notice sent, continues to default in payment, financial institution shall serve a final notice on the mortgagor demanding the payment of the mortgage money outstanding within thirty days from service of the final notice on the customer .due date, it shall send a second notice of demand for payment of the amount within fourteen days. In case the customer on the due date given in the second notice sent, continues to default in payment, financial institution shall serve a final notice on the mortgagor demanding the payment of the mortgage money outstanding within thirty days from service of the final notice on the customer .

(3) When a financial institution serves a notice of demand, all the powers of the mortgagor in regard to recovery of rents and profits from the final mortgaged property shall stand transferred to the financial institution until such notice is withdrawn and it shall be the duty of the mortgagor to pay all rents and profits from the mortgaged property to the financial institution.

Provided that where the mortgaged property is in the possession of any tenant or occupier other than the mortgagor , it shall be the duty of such tenant or occupier , on receipt of notice in this behalf from the financial institution, to pay the rent or lease money or other consideration agreed with the mortgagor to the financial institution.(3) When a financial institution serves a final notice of demand, all the powers of the mortgagor in regard to recovery of rents and profits from the mortgaged property shall stand transferred to the financial institution until such notice is withdrawn and it shall be the duty of the mortgagor to pay all rents and profits from the mortgaged property to the financial institution: Provided that where the mortgaged property is in the possession of any tenant or occupier other than the mortgagor , it shall be the duty of such tenant or occupier , on receipt of notice in this behalf from the financial institution, to pay to the financial institution the rent or lease money or other consideration agreed with the mortgagor .

(4) Where a mortgagor fails to pay the amount as demanded within the period prescribed under sub-section (2), and after the due date given in the final notice has expired, the financial institution may , without the intervention of any Court, sell the mortgaged property or any part there of by public auction and appropriate the proceeds thereof towards total or partial satisfaction of the outstanding mortgage money: Provided that before exercise of its powers under this sub-section, the financial institution shall cause to be(4) Where a mortgagor fails to pay the amount as demanded within the period prescribed under subsection (2), and after the due date given in the final notice has expired, the financial institution may , without the intervention of any court and subject to any rules made by the Federal Government under sub-section (5), sell the mortgaged property or any part thereof by public auction and apply the proceeds thereof towards total or partial satisfaction of the outstanding mortgage money in the following manner , namely:-- published a notice in one reputable English daily newspaper with wide circulation and one Urdu daily newspaper in the Province in which the mortgaged property is situated, specifying particulars of the mortgaged property , including name and address of the mortgagor , details of the mortgaged property , amount of outstanding mortgage money , and indicating the intention of the financial institution to sell the mortgaged property . The financial institution shall also send such notices to all persons who, to the knowledge of the financial institution, have an interest in the mortgaged property as mortgagees.(a) the financial institution shall have the mortgaged property evaluated by a reputable valuation company on the panel of the Pakistan Banks Association as on the date of the final notice sent to the mortgagor under subsection (2);

(b) the financial institution shall cause to be published a notice in one reputable English daily newspaper with wide circulation and one reputable Urdu daily newspaper with wide circulation in the Province in which the mortgaged property is situated specifying the following, namely:__

(i) detailed particulars of the mortgaged property;

(ii) name and address of the mortgagor;

(iii) amount of the outstanding mortgage;

(iv) any encumbrances which the mortgaged property may be subject to which the financial institution is aware of;

(v) the financial institution's intention to sell the mortgaged property through a public auction;

(vi) the reserve price below which the mortgaged property cannot be sold;

(vii) the time and place at which the public auction is to take place, provided that the public auction shall take place in the city where the mortgaged property is located; and

(viii) any other information, which may be relevant;

(c) the financial institution shall send a notice with the information, specified in clause (b), to the mortgagor and to all persons who, to the knowledge of the financial institution, have an interest in the mortgaged property as mortgagees; and

(d) the public auction for the sale of the mortgaged property shall not take place before the expiration of three business days of the publication of the notice as required under clause (b). (5) In addition to its powers under sections 25 and 26, the Federal Government may , by notification in the official Gazette, make rules specifying the mode, conduct or method of sale of the mortgaged property and in addition to the conditions stipulated in subsection (4)

(5) The financial institution shall be entitled, in its discretion, to participate in the public auction, and to purchase the mortgaged property at the highest bid obtained in the public auction.(6) The financial institution shall be entitled, in its discretion, to participate in the public auction and to purchase the mortgaged property for an amount ten percent higher than the highest bid obtained in the public auction, provided that where the financial institution chooses to purchase the mortgaged property at the highest bid obtained in the public auction, it shall issue notice to the mortgagor who shall have three business days from the service of the notice to match the financial institution's bid.

If the mortgagor is able to match the financial institution's bid, he shall be allowed to purchase the mortgaged property .

(6) Where the mortgagor or his agent or servant or any person put in possession by the mortgagor or on account of the mortgagor does not voluntarily give possession of the mortgaged property sought to be sold or sought to be purchased or purchased by the financial institution, a Banking Court on application of the financial institution or purchaser shall put the financial institution or purchaser , as the case may be, in possession of the mortgaged property in any manner deemed fit by it: Provided that the Banking Court may not order eviction of a person who is in occupation of the mortgaged property or any part thereof under a bona fide lease, except on expiry of(7) Where the mortgagor or his agent or servant or any person put in possession by the mortgagor or on account of the mortgagor does not voluntarily give possession of the mortgaged property sought to be sold or sought to be purchased or purchased by the financial institution, a Banking Court on application of the financial institution or purchaser shall put the financial institution or purchaser , as the case may be, in possession of the mortgaged property in any manner deemed fit by it: Provided that the Banking Court may not order eviction of a person who is in occupation of the mortgaged property or any part thereof under a bona fide lease, except on expiry of the period of the lease, or on payment of such the period of the lease, or on payment of such compensation as may be agreed between the parties or as may be determined to be reasonable by the Banking Court.

Explanation.- (1) Where the lease is created after the date of the mortgage and it appears to the Banking Court that the lease was created so as to adversely af fect the value of the mortgaged property or to prejudice the rights and remedies of the financial institution, it shall be presumed that the lease is not bona fide, unless proved otherwise.compensation as may be agreed between the parties or as may be determined by the Banking Court to be reasonable.

Explanation. (1) Where the lease is created after the date of the mortgage and it appears to the Banking Court that the lease was created so as to adversely af fect the value of the mortgaged property or to prejudice the rights and remedies of the financial institution, it shall be presumed that the lease is not bona fide, unless proved otherwise.

(7) For purposes of execution and registration of the sale deed in respect of the mortgaged property , the financial institution shall be deemed to be the duly authorized attorney of the mortgagor and a sale deed executed and presented for registration by duly authorized attorneys of the financial institution shall be accepted for such purposes by the Registrar and Sub-Registrar under the Registration Act, 1908 (XVI of 1908).(8) For purposes of execution and registration of the sale deed in respect of the mortgaged property , the financial institution shall be deemed to be the duly authorized attorney of the mortgagor and a sale deed executed and presented for registration by duly authorized attorneys of the financial institution shall be accepted for such purposes by the Registrar and Sub- Registrar under the Registration Act, 1908 (XVI of 1908).

Provided that no such sale deed shall be executed or registered until expiry of seven days after the completion of the public auction for the sale of the mortgaged property .

(8) For purposes of execution and registration of the sale deed in respect of the mortgaged property , the financial institution shall be deemed to be the duly authorized attorney of the mortgagor and a sale deed executed and presented for registration by duly authorized attorneys of the financial institution shall be accepted for such purposes by the Registrar and Sub-Registrar under the Registration Act, 1908 (XVI of 1908).

Provided that no such sale deed shall be executed or registered until expiry of seven days after the(9) Upon execution and registration of the sale deed of the mortgaged property in favor of the purchaser all rights in such mortgaged property shall vest in the purchaser free from all encumbrances and the mortgagor shall be divested of any right, title and interest in the mortgaged property . completion of the public auction for the sale of the mortgaged property .

(9) Net sale proceeds of the mortgaged property , after deducting all expenses of sale or expenses incurred in any attempted sale, shall be distributed ratably amongst all mortgagees in accordance with their respective rights and priorities in the mortgaged property . Any surplus left, after paying in full all the dues of mortgagees, shall be paid to the mortgagor .(10) Net sale proceeds of the mortgaged property , after deducting all expenses of sale or expenses incurred in any attempted sale, shall be distributed ratably amongst all mortgagees in accordance with their respective rights and priorities in the mortgaged property . Any surplus left, after paying in full all the dues of mortgagees, shall be paid to the mortgagor .

(10) A financial institution which has sold mortgaged property in exercise of powers conferred herein shall file proper accounts of the sale proceeds in a Banking Court within thirty days of the sale.(11) A financial institution which has sold mortgaged property in exercise of powers conferred herein shall file proper accounts of the sale proceeds in a Banking Court within fourteen days of the sale.

(11) All disputes relating to the sale of the mortgaged property under this section including disputes amongst mortgagees in respect of distribution of the sale proceeds, shall be decided by the Banking Court.(12) All disputes relating to the sale of the mortgaged property under this section including disputes amongst mortgagees in respect of the mode, conduct or method of the sale or the distribution of the sale proceeds, shall be decided by the Banking Court to the exclusion of any other court of law , including the High Court.

(12) Neither the Banking Court nor the High Court shall grant an injunction restraining the sale or proposed sale of mortgaged property unless (a) it is satisfied that no mortgage in respect of the immovable property has been created; or

(b) all moneys secured by mortgage of the mortgaged property have been paid; or

(c) the mortgagor or objector deposits in the Banking Court in cash the outstanding mortgage money .(13) The Banking Court may grant an injunction restraining the sale or proposed sale of the mortgaged property , if__

(a) it is satisfied that no mortgage in respect of the immovable property has been created; or

(b) it is satisfied that there is fraud in the proposed mode, conduct or method of the sale, provided that no injunction shall be granted on the ground of fraud unless upon the fact proved the Banking Court is satisfied that the applicant has sustained substantial injury by reason of such fraud and such injury cannot be compensated by damages; or

(c) all moneys secured by mortgage of the mortgaged property have been paid; or

(d) the mortgagor or objector deposits in the Banking Court in cash the outstanding mortgage money . (14) Where any mortgaged property has been sold, the mortgagor or any person entitled to a share in the ratable distribution of assets or whose interest is af fected by the sale, may apply to the Banking Court to set aside the sale on the ground of fraud: Provided that no sale shall be set aside on the ground of fraud unless, upon the facts proved, the Banking Court is satisfied that the applicant has sustained substantial injury by reason of such fraud and such injury cannot be compensated by damages. (15) An application for setting aside the sale under subsection (14) must be made within seven days of completion of the public auction for the sale of the mortgaged property and shall not be entertained by the Banking Court unless the applicant deposits an amount equal to twenty-five percent of the reserve price or furnishes security for the same amount to the satisfaction of the Banking Court.

(13) The rights and remedies provided under this section are in addition to, and not in lieu of, any other rights or remedies a financial institution may have under this Ordinance.(16) The rights and remedies provided under this section are in addition to and not in lieu of any other rights or remedies a financial institution may have under this Ordinance. (17) The provisions contained in this section shall have ef fect notwithstanding anything contained in this Ordinance or any other law for the time being in force or any judgment of any court and in case of any conflict between the provisions contained in this section and any other law for the time being in force or any judgment of any court, the provisions contained in this section shall prevail.

ORDER OF THE COUR T.

In view of the respective opinions recorded above by majority of 4 to 1, we hold that re-enacted section 15 and Rules, 2018 [except Rule -3 (c) (iv)], are intra-vires and Constitutional, and to that extent petitions are dismissed.

We further hold that Rule-3 (c) (iv) of Rules, 2018 is unconstitutional and ultra-vires the Ordinance, 2001, and re- enacted section 15. The challenge, to the extent of Rule - 3 (c) (iv) of Rules, 2018, is successful and petitions are allowed to said extent only . No order as to costs.