ABID HUSSAIN CHATTHA, J. This Regular First Appeal is preferred under section 22 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 (the "Ordinance") against the impugned Judgment and Decree dated 23.06.2021 passed by Judge Banking Court-III, Multan (the "Banking Court"), whereby, the suit for recovery instituted by the Respondent Bank was decreed in the sum of Rs. 5,406,486.87/- against the Appellants, jointly and severally with cost of suit and cost of funds from 30.12.2019 till the realization of the decretal amount.
2. Briefly it was averred in the plaint that Appellant No. 1 availed Finance Facilities from the Respondent Bank from 05.09.2016 to 31.03.2019 satisfactorily by way of renewing the same from time to time as per its business needs after executing the finance and security documents regarding the same. Lastly, Appellant No. 1 availed Running Finance Facility (the "RF Facility") for Rs.
05 Million sanctioned vide Facility Offer Letter dated 19.03.2019 with the date of expiry as 31.03.2020.The requisite finance and security documents as stipulated in the Facility Offer Letter were duly executed by the Appellants. Appellants Nos. 2 and 3 stood as guarantors after executing their personal guarantees. The security, documents included the registration of charge with the SECP and execution of mortgage deeds. The necessary details were duly narrated in the plaint and all the required finance and security documents were appended with the plaint. The default was alleged regarding repayments of the availed RF Facility which constrained the Respondent Bank to file the suit.
3. The Appellants filed a joint Application for leave to defend the suit (the "PLA"). The sanctioning and availing of the RF Facility was admitted, however, a number of factual and legal objections were raised in the PLA. It was contended that suit has not been competently filed through an authorized person; the Respondent Bank has no cause of action to file the suit; the statement of accounts is not in accordance with law; the suit is barred, by law and as such, the plaint is liable to be rejected under Order VII, Rule 11 of the Code of Civil Procedure 1908; the markup was levied beyond the date of expiry; and importantly a number of debit entries were listed in paragraph No. 7 of the PLA indicating that various charges were levied in the statement of accounts without any lawful authorization. Accordingly, it was prayed that questions of law and facts raised in the PLA require recording of evidence and same cannot be adjudicated in the summary proceedings.
4. The Respondent Bank filed a detailed Replication to the PLA. The questions raised in the PLA were dealt with by the Banking Court and in consequence thereof, the PLA was dismissed and the suit was decreed.
5. Learned counsel for the Appellants contended that the impugned Judgment and Decree is illegal, unlawful and contrary to the facts and record of the case for the reason that debit entries indicated and identified in the PLA were not excluded while determining the amount due and no reasoning was advanced by the Banking Court as to how such charges were lawfully debited from the account of Appellant No. 1. It was stated that Respondent Bank had no lawful authority to deduct such charges.
6. In contrast, learned counsel for the Respondent Bank submitted that impugned Judgment has been passed in consonance with law: All the issues raised in the PLA were duly addressed by the Banking Court with reference to the finance and security documents as well as the statement of accounts appended with the plaint. He specifically stated that in the Replication filed by the Respondent Bank, each and every debit entry indicated in the PLA was duly explained with reference to the charges incurred by the Respondent Bank for and on behalf of the Appellants and the Respondent Bank was lawfully authorized to levy and recover such charges on the strength of the Facility Offer Letter, Agreement of Financing and the security documents executed by the Appellants.
7. Arguments heard. Record perused.
8. At the very outset, it is noted that the Banking Court rendered a well reasoned and speaking Judgment in which all the questions of law and facts raised by the Appellants in their PLA were adequately addressed. The same were not raised before us during the course of arguments and for the sake of brevity we need not address them again. Suffice is to state that availing of the RF Facility, the execution of all the finance and security documents and the payments made to the Respondent Bank were admitted in the PLA. The Appellants did not fulfill the requirement of section 10(4), (5) and (6) of the Ordinance in their PLA with respect to the amount of finance availed, paid, disputed and payable, thereby, entailing penal consequences by way of rejection of the PLA as stipulated in section 10(7) of the Ordinance. The only contention raised before us in this Appeal to the effect that debit entries identified in the PLA from the statement of accounts were unlawful, is also misconceived. It was not disclosed in the PLA as to how each and every debit entry was unlawful. Mere general and bald allegation that a particular entry is unlawful does not advance the cause of the Appellants. No document was appended with the PLA in this regard to dislodge the presumption of truth attached to the statement of accounts. In the Replication filed by the Respondent Bank, each and every entry was duly explained which was minutely perused by us.
These are either charges which were initially incurred by the Respondent Bank for and on behalf of Appellant No. 1 and later recovered on the strength of the financing documents such as, valuation charges paid to the evaluator, payment to Advocate for legal opinion and payment of fee to SECP for registration of charges, etc. Some of the payments were regarding markup unpaid by Appellant No. 1 which were debited from the principal account and credited into the separate markup account. Learned counsel for the Appellants was confronted with the same but he could not substantiate as to how the debit entries in the statement of accounts were unlawful especially when each and every entry was duly explained in the Replication. It is further noted that although the date of expiry of the RF Facility was 31.03.2020 yet the Banking Court diligently determined the date of default w.e.f. 30.12.2019 and excluded an amount of Rs. 416,935.13/- as markup charged beyond the date of default from the aggregate payable amount and passed the Decree, accordingly while granting the cost of funds from the date of default as per mandate of the Ordinance.
9. In view of the above discussion, it is evident that the impugned Judgment and Decree was rightly and lawfully passed by the Banking Court. Consequently, this Appeal being devoid of any merit, is dismissed with costs.