Despite issuance of repeated notices none has entered appearance on behalf of the Respondent No.1/Judgment- debtor , as it is not possible for a judgment-debtor that his property is at stake and he himself unable to pursue the proceedings being conducted in this regard and this very conduct of him shows his lack of interest in pursuing this matter . In these circumstances, he is proceeded against ex-parte.
2. This order will dispose of the E.F.A. in hand as well as connected matter (E.F.A. No.246935 of 2018) involving similar facts impugning the order dated 13.09.2018, passed by learned Judge Banking Court-IV , Lahore.
3. The case in hand (Execution First Appeal No.242230 of 2018) has been filed by the Appellant Bank under Section 22 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 , seeking setting aside of order dated 13.09.2018, passed by the learned Judge Banking Court-IV , Lahore whereby auction proceedings carried out by the Court Auctioneer under order dated 17.04.2018, passed by learned Judge Banking Court No. IV, Lahore were set aside ordering return of auction money to the auction purchaser .
4. Briefly stated facts of the case are that Appellant-Bank filed a suit for recove ry of Rs.10,627,024.00 against Respondent No.1 (Sajjad Aslam) qua the Home Finance Facility of Rs.10,000,000/- availed and utilized under the agreement for long term financing on markup basis by executing and deliver ing certain documents besides providing as security deposit of title deeds by him, in respect of his property; but he defaulted in repayment of the outstanding amount of Rs.10,627,024.48. On issuance of Notice by the learned Banking Court, he filed application for leave to appear and defend the suit which was contested by the Appellant-Bank and with consent of the parties the suit was decreed in favour of the Appellant Bank and against defendant/Respondent No.1, as the latter was ready to pay the Principal amount of loan availed by him i.e. Rs.9,940,693.18. On his default, pursuant to issuance of said notice under Order XXI, Rule 66, C.P.C., the learned Judge Banking Court No. IV put his mortgaged property to auction. The Court-Auctioneer submitted the terms and conditions of auction along with auction schedule which was approved vide order dated 17.04.2018. Respondent No.2 (Muhammad Nasir Irshaad) participated in auction and being declare d the highest bidder , he deposited the purchase money . Said Auction Proceedings conducted on 16.05.2018 were impugned through objection petitions filed by Respondent No. 1/judgment debtor (Sajjad Aslam) and a third party (Mussarat Siddique etc.) which stood dismissed vide order dated 13.09.2018 while the aforementioned sale was set aside ordering return of sale proceeds of Rs.32,150,000.00 to the auction purchaser/Respondent No.2, by learned Judge Banking Court No. IV, Lahore, vide order dated 13.09.2018.
5. It is contended by learned counsel for the. Appellant-Bank that while passing the impugned order learned Judge Banking Court has not taken into consideration the essence of Order XXI, Rule 92, C.P.C., which enlightens that where no application is made under Rules 89, 90 and 91 of Order XXI, C,P.C.; or, where such application is made and disallowed, the Court shall make an order confirming the sale, and thereupon the sale shall become absolute; that this ground is more strengthened especially when objection petitions filed by the judgment. debtor or by a third party , have been rejected then no discretion is vested with the learned Executing Court to set aside the sale; that as per schedule of auction, the Court-Auctioneer pasted the proclamation outside the court premises on 16.04.2018, which was changed by the Executing Court as 19.04.2018 thus it was a fault committed by the Court- Auctioneer , for which, the Appellant should have not been penalized by setting aside of the Auction Proceedings.
Even otherwise, First Proviso of Order XXI, Rule 90, C.P.C. guides that no sale shall be set aside on the ground of irregularity or fraud unless upon the fact proved the Court is satisfied that the Applicant has sustained substantial injury by reason of such irregularity or fraud; that due to such an irregularity 'the judgment debtor has not, suffered from any substantial injury ,' therefore, the impugned order may be set aside.
6. Learned counsel for Respondent No.2 endorsing the arguments advanced by learned counsel for the Appellant- Bank adds that when objections raised against the Auction Proceedings were rejected by the learned Judge Banking Court then mere on noticing a minor irregularity which neither has caused any substantial injury nor prejudice the rights of the judgment-debtor is not appreciable. Therefore, prays for setting aside of order passed by learned Judge Banking Court by restoring the Auction Proceedings for the date of its finalization.
7. We have heard the arguments of the learned counsel for the parties and perused the record.
8. The main grievance of the Appellant agitated through this Appeal is that the learn ed Judge Banking Court did not take into consideration the language of Order XXI, Rule 92 as well as Rules 90 and 91 of the C.P.C. and merely on noticing a mistake/irregularity of the Court- Auctioneer , he set aside, the Auction Proceedings, which is not only sheer violation of the said Rules but also against the norms of law. As the Auction Proceedings were required to be conducted in the following terms:- Pasting of Sale Proctamation at the Court Premises on 19. 04 .2018; Pasting of Sale Proclamation at the site of Auction on 25.04.2018 and Auction at spot on 16.05.2018 (W ednesday) at 02:00 p.m.
Therefore, learned Judge Banking Court observed that the report submitted by the Court-Auctioneer with respect to affixing the proclamation outside the court premises on 16.04.2018 was incorrect, as on that date there was no order of the court nor the schedule submitted by the Court-Auctioneer was approved, therefore, the foundation of the auction proceedings was shame and no superstructure on the wrong proceedings can be sustained quoting that when the foundation is wrong/weak, any superstructure or elevation on the same liable to be fell down and thus the impugned order dated 13.09.2018 setting aside the Auction-Proceed ings carried out by the Court Auctioneer pursuant to the order dated 17.04.2018 and also ordering return of auction money deposited by the Auction Purchaser to him. We are afraid, this is not fair by any stretch of imaginati on as, if an occurred irregularity has been noticed by the Banking Court, it must have discussed its impact, effect or a substantial injury caused by the judgment-debtor . In this regard, we seek support from a judgment reported as Zakaria Ghani and 4 others v.
Muhammad Ikhlaq Memon and 8 others (PLD 2016 Supreme Court 229) wherein it has been observed that Order XXI, Rule 90, C.P.C. proceeds on different basis. In order to succeed it was mandatory for the judgment- debtor to satisfy the court, on the merits, that the sale should be set aside on the ground of a material irregularity , or fraud, in publishing or conducting it. Another condition was prescribed by means of the proviso thereto which stipulated that no sale shall be set aside on the ground of irregularity or fraud unless, upon the facts proved before the Court, it was established that the judgment-debtor had sustained substa ntial injury by reason of such irregularity or fraud. A mere allegation was not sufficient. It has to be established that no merely an irregularity but a material irregularity had taken place, or, in the alternative that fraud had been perpetrated in the process of carrying out the sale. Even if these conditions were complied with the judgment debtor must satisfy the court that he had sustained a substantial injury by reason thereof. It has further held that mere an irregularity , even if material, should not suffice unless it could be shown that material loss had been caused. The more enlightening observation made by the Hon'ble Supreme Court are that where the irregularity consisted of errors by the court, or by court officials, no party should be made to suffer by reason thereof . So, under these guidelines it can safely be said that even an irregularity made in this case by the Court-Auctioneer by pasting Auction Proclamation at the Court premises on 16.04.2018 instead of 19.04.2018 is not lethal to the rights of judgment-debtor causing any substantial injury to him which itself is corroborated by going through the order dated 17.04.2 018 when during hearing of his objection petition filed, umpteenth time on behalf of the judgment-debtor has been tried to seek postponement of Auction-Proceedings even on leaning upon the stance that his petition in this regard is pending adjudication before the august Supreme Court of Pakistan, therefore, execution proceedings may be adjourned but failed to tender any document/stay-order for satisfaction of the court; meaning thereby , that intent of judgment-debtor was to delay the auction proceedings only. Besides, it has also been observed by the august Supreme Court that where the judgment-debtor felt that he was being harmed by some ministerial order with respect to sale of his immoveable property , which was not in accordance with law, it was his clear duty to assert the same before the court rather raising it at the stage of appeal, or further appeal, or in review , or not at all and expect the court to do it for him and that the Judgment-debtor could not be allowed to do nothing and then after the passage of many years in which third party interests had been created to rely on a technical objection to delay the court of justice.
9. The upshot of the above discussion is that we don't think that such an irregularity has been committed by the Court Auctioneer which has caused substantial injury to the judgment-debtor; but, to the Appellant certainly , therefore, this Appeal is allowed and the order dated 13.09.2018, passed by learned Judge Banking Court-IV , Lahore, to the extent of reiterated, to the extent of Auction Proceedings only is set aside. The Auction Proceedings conducted under order 17.04.2018 are hereby confirmed on the terms and conditions, as were scheduled by the said order passed by learned Judge Banking Court No. IV , Lahore.