MUHAMMAD SAJID MEHMOOD SETHI, J. Through instant first appeal against order, filed under section 22 of the Financial Institutions (Recovery of Finances) Ordinance ("FIO"), 2001, appellant- bank has assailed order dated 13.02.2018, passed by learned Judge Banking Court-Ill, Lahore, whereby appellant's application under Order IX, Rule 8 read with section 151, C.P.C., for recalling of order dated 22.06.2009 and restoration of suit, was dismissed.
2. Brief facts of the case are that appellant's predecessor bank Prime Commercial Bank Limited filed suit for recovery against respondents in the year 1998, which was ex parte decreed on 07.12.1998. The respondents moved an application for setting aside ex parte decree, which was also dismissed on 08.05.1999. Feeling aggrieved, respondents filed FAO, which was allowed by this Court and ex parte decree dated 07.12.1998 was set aside with the observation that respondents may file application for leave to defend the suit ("leave application") within a period of 10 days, but the needful was not done within stipulated period and resultantly, suit was again decreed on 23.07.2001. Respondents again filed appeal before this Court, which was allowed, aforesaid judgment was set aside and respondents were permitted to file leave application and Trial Court was directed to decide it in accordance with law. After filing of leave application by the respondents, suit was once again decreed vide judgment and decree dated 26.09.2006.
Respondents filed regular first appeal, which was allowed and aforesaid judgment was set aside by this Court with direction to decide leave application afresh. Thereafter, the matter was taken up by learned Trial Court on 17.12.2008 and notices Pervi were issued to the parties. On 25.02.2009, counsel for appellant-bank was present and notices Pervi were repeated to respondents. Lastly, on 22.06.2009, counsel for respondents appeared, however, none appeared on behalf of appellant- bank, therefore, suit was dismissed for non-prosecution. Appellant-bank filed application under Order IX, Rule 8 read with section 151, C.P.C., for recalling of order dated 22.06.2009 and restoration of suit, which was dismissed vide order dated 13.02.2018. Hence, this appeal.
3. Learned counsel for appellant-bank submits that on 22.06.2009, main suit was not fixed for hearing rather only leave application was fixed, thus, main suit could not be dismissed for want of prosecution. He adds that the order dismissing the suit for non-prosecution was void ab-initio, therefore, limitation to file application was three years. In the end, he submits that impugned order is unsustainable in the eye of law. In support, he has referred to Mst. Suraya Parveen v. Mst.
Rukhsana Hanif and others (2012 SCMR 656), National Bank of Pakistan v. The Additional District Judge, Lahore and 2 others (PLD 1985 Lahore 326), Muhammad Iftikhar through Special Attorney v. Zarai Taraqiati Bank Limited through Chairman and another (2005 CLD 1454), Messrs Sui Northern Gas Pipelines Ltd. through Deputy Chief (Legal) v. Muslim Commercial Bank Ltd., Avari Hotel Branch, Lahore through Manager and another (2006 CLD 816), CITIBANK N.A. through Manager and duly authorized Attorney of the Bank v. Judge Banking Court-III, Lahore and another (2006 CLD 1543), Abid Aziz Khan and 2 others v. Bank of Punjab through Branch Manager (2007 CLD 997), Rab Nawaz Shahid and 3 others v. Bank of Khyber and 2 others (2007 CLD 1236), Messrs Fateh Textile Mills Ltd. v. West Pakistan Industrial Development Corporation (PLD 2008 Karachi 103) and Jamshed Iqbal Butt and another v. Mst. Bushra Tufail (2015 CLC 316).
4. Conversely, learned counsel for respondents defends the impugned order and submits that appellant-bank has failed to point out any illegality or legal infirmity therein, thus, same is liable to be upheld. He adds that application for recalling of order dated 22.06.2009 and restoration of suit was grossly time-barred and rightly dismissed by learned Judge Banking Court.
5. Arguments heard. Available record perused.
6. Perusal of record reveals that learned Judge Banking Court dismissed appellant's suit for non- prosecution vide order dated 22.06.2009, when the case was fixed for submission of power of attorney and arguments on leave application. Under the law, when case is fixed for arguments on leave application, neither the Court can dismiss the leave application for non-prosecution nor decide the suit or dismiss the suit unless leave application is decided. Banking Court had no jurisdiction to dismiss the suit for non-prosecution. It is also notable, as has been discussed in brief history of the case narrated supra, that appellant-bank obtained decree in the suit thrice and merely in the peculiar circumstances, the suit was dismissed in absence of the bank's counsel in a wrong manner and again application was dismissed without appreciating the applicable law.
7. Undoubtedly, learned Banking Court could have proceeded under Order XVII, Rule 3, C.P.C. rather than dismissing the suit for non-prosecution. Sufficient material was available on record to proceed further on the crucial date to decide the leave application. Since the date was not fixed for hearing of the suit, therefore, order of dismissal of suit for non-prosecution was legally not sustainable. Date on which suit was dismissed, was not a date of hearing within the contemplation of law, therefore, except on a date of hearing, action to dismiss a suit in default could not be taken against plaintiff. Hence, dismissal of suit having been ordered on the date not fixed for hearing, question of limitation becomes irrelevant. Reliance is placed upon the cases of CITIBANK and Jamshed lqbal Butt supra.
It is also evident from record that none of the evidence brought on record has been discussed by learned Judge Banking Court while passing impugned order. On this score alone, impugned order is liable to be set aside. As discussed above, order of dismissing suit for non-prosecution is not legally sustainable and it is well-settled that no limitation runs against void order. The question of limitation in respect of an application seeking restoration of the suit would not be relevant if dismissal itself was not proper. Reference is made to Mst. Suraya Parveen's case supra and Qazi Munir Ahmed v. Rawalpindi Medical College and Allied Hospital through Principal and others (2019 SCMR 648).
8. In view of the above discussion, this appeal is allowed and impugned order dated 13.02.2018, passed by learned Judge Banking Court-III, Lahore, is set aside. Consequently, appellant's suit shall be deemed to be pending before learned Banking Court, which shall be decided in accordance with law, through a well-reasoned judgment, after hearing the appellant and all concerned, within a period of sixty days from the date of receipt of certified copy of this order.