QAISER RASHID KHAN, J.--- Through the appeal in hand, the appellants have called in question the judgment and decree dated 13.08.2009 of the learned Banking Court-I, Peshawar whereby their application for leave to defend was dismissed and the suit of the respondent-bank was decreed against them and respondents Nos.2 to 5 (defendants Nos.1 and 4 to 6) to the tune of Rs.
9,867,116.00 with costs of funds and costs of the suit.
2. As per brief averments in the plaint, Shah Jehan (respondent No. 2) being the proprietor of Messrs Lasani Flour General Mills, Mardan Road Sardherr District Charsadda applied to the respondent-bank for Cash Finance Facility to the tune of Rupees five million which was sanctioned to him through sanction advice dated 10.06.2003 followed by its enhancement to rupees 8.5 million on 22.06.2004 and, in turn, he executed different documents including Finance Agreement, Demand Promissory Note, letter of Hypothecation and letter of continuity; that defendants Nos.1 and 2 mortgaged the flour mills together with land, building and machinery in favour of the bank as a security for the repayment of the dues vide registered mortgaged deed dated 04.07.2003 and in addition to above they along with the co-defendants collaterally mortgaged their immoveable property measuring 12 Kanals situated at Mauza Wardaga Tehsil and District Charsadda vide deed dated 29.07.2003, followed by the execution of personal guarantees in favour of the bank. After making some deposits, the borrower-defendant No. 1 made default in the payment of the outstanding amount. Thereafter, the defendants were issued various legal notices to pay the same but to no avail and ultimately the respondent-bank filed a recovery suit against them.
3. During the pendency of the suit, defendant No. 3 namely Mst. Shamsheda Begum passed away and her legal heirs were brought on the record. Appellant No. 1 filed leave to defend application on 17.08.2007 followed by defendants No. 2, 4 and 5 on 23.12.2008, and appellants Nos. 3 and 4 being daughters of Mst. Shamsheda Begum filed their separate leave to defend application on 20.06.2009 which were dismissed and resultantly the suit was decreed through the impugned judgment and decree.
4. The learned counsel for the appellants contends that despite having raised important questions of law and facts in the leave to defend applications the same were not considered by the learned trial court. Further contends that neither any property was mortgaged by the appellants nor they have executed any personal guarantees in favour of the bank in lieu of finance facility availed of by the borrower namely Shah Jehan and that the guarantor namely Shamsheda Begum had died prior to the mortgage of the property in favour of the bank and her thumb impression appearing on the mortgage deed and personal guarantee are fake and thus in such a situation, the learned Banking Court was obliged to have allowed the leave to defend applications and provided an opportunity to the appellants to adduce evidence in support of their claim but somehow the said right was denied to them.
Such contentions of the learned counsel for the appellants are resisted by the learned counsel for the respondent-bank who supports the impugned judgment and decree of the learned trial court on almost the same grounds as detailed therein.
5. Arguments heard and the available record perused.
6. As the record unfolds, it was the respondent No. 2 namely Shah Jehan who had applied to the respondent-bank for Cash Finance Facility for an amount of Rupees 5 million in the year 2003 which was duly sanctioned in his favour through sanction advice dated 10.06.2003 and by way of security, he executed various documents in favour of the respondents-bank including demand promissory note, agreement for finance, letter of hypothecation and as a collateral security the appellants as well as the co-defendants mortgaged their property in favour of the bank and in addition they also executed their personal guarantees undertaking therein to liquidate the liability of the bank in case of the failure of the principal' borrower to do so. We have before us a copy of the sanction advice dated 14.04.2004 where the finance limit was enhanced from Rupees 5 million to rupees 8.5 million and accordingly all the other necessary documents including demand, promissory note, finance agreement and personal guarantees were obtained. It appears that it was on account of default committed by the principal borrower when the bank was constrained to file a recovery suit against the principal borrower as well as the other co-defendants who had mortgaged their property as well as executed personal guarantee in favour of the bank.
7. The record shows that after being put to notice, the principal borrower namely Shah Jehan (respondent No. 2) did not turn up to file any application for the grant of leave to defend the suit and thus he remained unrepresented before the learned Banking Court and only the present appellants along with respondent No. 4 filed their leave to defend applications stating therein not to have stood guarantors for the principal borrower and also not to have mortgaged their property in favour of the bank.
8. So far as stance of the appellants that Mst. Shamsheda had died prior to the availing of the finance facility by the borrower Shah Jehan is concerned, no document worth the name in the form of any death certificate was brought on the record to confirm the factum of death of the said lady before availing of the finance facility by her son Shah Jehan from the respondent-bank. Moreover, no date of her death has been mentioned in the leave to defend applications.
Above apart, Mst. Shamsheda had executed along with her children i.e. the appellants and respondents a registered General Power of Attorney in the name of her other son namely Muhammad Karim in respect of their property, authorizing him to do various acts including its mortgage. The said Muhammad Karim in his capacity as General Attorney had mortgaged the properties in favour of the respondent-bank. The appellants/defendants on their part had never challenged the authenticity and genuineness of the said General Power of Attorney in favour of Muhammad Karim.
9. Since the registered mortgage deed has been duly executed, therefore, the objections of the appellants not to have signed/thumb impressed the said documents i.e. personal guarantees as well as mortgaged deed appear to be perfunctory in nature and of course did not lead to the substantial questions of law and facts as provided in sub-section 3 of section 10 of the Financial Institutions (Recovery of Finances) Ordinance 2001. All the appellants have filed stereo type leave to defend applications with the same set of facts. So far as the statement of account is concerned, no objection worth the name has been raised in respect of any entry contained therein. Thus, the same is safely presumed to have gone unchallenged at the appellants end.
10. Such being the case, we understand that where the appellants failed to raise substantial questions of law and facts in their applications for leave to defend the suit, then the same have been rightly dismissed by the learned Banking Court through the impugned judgment and decree.
Such findings do not suffer from any illegality so as to in turn call for the interference of this court through the present appeal.
11. As a sequel to the above discussion, we find no merit in the present appeal and the same is accordingly dismissed with costs.