RAHEEL KAM RAN, J. This is an appeal under Section 22 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 ('Ordinance'), whereby the appellants have assailed the order dated 06.11.2018 passed by the Judge Banking Court No.1, Lahore dismissing their objection petition under Section 19(7) of the Ordinance read with Section 47 and Order XXI, Rules 54, 58, 59, 60, 66, 67, 68, 69, 90 and 100 of the Code of Civil Procedure, 1908 (`C.P.C.')
2. Relevant facts in the background are that the appellants, being third party, filed the aforementioned objection petition with the assertion that they were lawful owners in possession of the land measuring 18-kanals, 13-marlas bearing Khasra No.45, Khewat No.10 (old Khewat No.9), Khatooni No.16 (old Khatooni No.12), vide oral gift Mutation No.114 dated 31.08.2004 and mutation No.173 belonging to Khaliq Dad-appellant No.1 situated at Mouza Rakh Bhoneki Othar on the main Road Multan, Tehsil Pattoki, District Kasur vide Register Hagdaran Zameen for the year 2007-2008.
The appellants developed and established M/s Hussain Petroleum Services (petrol pump) on the aforementioned land and obtained dealership of ADMORE Gas (Private) Limited where they have been running their business without any interference from any corner. It was further asserted by the appellants that they invested huge amount of Rs.23,500,000/- for the construction and installation of petrol pump etc., and due to shortage of funds as well as to meet the daily business needs, appellant No.2, obtained finance facility of Rs.4,500,000/- regarding his share in the aforesaid property in the year 2005 and executed collateral mortgaged deed on 26.11.2005 in favour of the Bank of Punjab vide document No.1516, Bahi No.). Jild No.252 dated 28.11.2005 registered in office of Sub-Registrar Pattoki and the Aar Rehan/Charge which was still existing in favour of the Bank of Punjab. It was further alleged that on 30.09.2017, it came into the knowledge of the appellants that aforementioned petrol pump was auctioned by the order of the Court and after visiting the Court it was further revealed that Ch. Muhammad Usman-respondent No.4 was the highest bidder in the auction dated 18.09.2017. The appellants further averred that neither they had mortgaged the property to Standard Chartered Bank nor any loan facility was availed by them especially in presence of the aforementioned mortgage in favour of the Bank of Punjab against loan amount of Rs.4,500,000/-. The property in question was allegedly. auctioned for Rs.38,500,000/- through a bogus auction dated 18.09.2017 without the court auctioneer going at the spot and that too against valuation thereof at Rs.65,851,600/-. The appellants lastly averred that they got arranged demarcation of their property by making a request to the revenue authorities and it was clear that Sajjad Ahmed i.e. the judgment-debtor No.1 had no concern with the property of the appellants to get the same mortgaged with the Bank. Accordingly, the appellants have called in question the auction report dated 25.09.2017 for being based on fraud and patent illegality which was liable to be set aside.
3. After hearing arguments of the parties, the objection petition of the appellants was dismissed through the order impugned herein while observing that the appellant-Noor Hassan failed to bring on record any document showing that the auctioned petrol pump was situated on the landed property owned by the said appellant or that he obtained a dealership from ADMORE Gas Private Limited, therefore, the above contentions of the appellants were not substantiated or supported by any document. It was also mentioned in the impugned order that earlier an objection petition filed on behalf of the appellant was dismissed on 19.01.2016 wherein merits of the application were fully discussed, which attained finality. The Court also inferred collusiveness of the appellant with judgment debtors just to frustrate the decree.
4. Learned counsel for the appellants states that there was ample material available on record to establish claim of the appellants qua setting up of the petrol pump on the landed property of appellant-Noor Hassan and of obtaining dealership from ADMORE Gas Private Limited; that while passing the order dated 19.01.2016, auction of the land belonging to Ali Hassan-respondent No.3 in execution of the decree against him was allowed without prejudice to right of the appellant-Noor Hassan being co-owner in the joint khata; that collusiveness of the appellant-Noor Hassan with judgment-debtors was inferred on the basis of surmises, conjectures and without referring to any document specifically; that neither the appellants were the defendants, customers, borrowers, mortgagers, indemnifiers or guarantors of the Bank (respondent No.1) nor did they authorize any one to mortgage their valuable land including petrol pump, therefore, their property had no connection whatsoever with the finance facility director or indirectly; and that the impugned order was unwarranted by facts and law on the subject, therefore, the same was liable to be set aside.
5. Conversely, learned counsel for respondent No.4, on the other hand, has supported the impugned order for the reasons stated therein. He has further emphasized that the said respondent had already deposited total auction amount of Rs.38,500,000/- in the Court and Sale Certificate of the auctioned property has also been issued in his favour.
6. Arguments heard, Record perused.
7. From perusal of order dated 19.01.2016 on objection petition of appellant-Noor Hassan, it is manifest that the property subject matter of the impugned auction is co-ownership in the joint khata of appellant-Noor Hassan and Ali Hassan i.e. the judgment-debtor/-respondent No.3. The judgment-debtors availed the loan finance facility against pledge of documents by annexing copy of Jamabandi to the extent of 28-Kanals 12-Marlas land belonging to Ali Hassan-respondent No.3 and the same was subject matter of the execution petition and auction proceedings. The Banking Court refused to stop the auction proceedings while holding that if the aforementioned property was auctioned, the right of the appellant-objection petitioner being co-owner in joint khata was not going to be prejudiced in any manner as the successful bidder has only to substitute the co- owner with the same rights and liabilities. However, it appears that while dismissing the objection petition under challenge through the impugned order, the Banking Court changed its position qua the earlier order dated 19.01.2016 with the following findings:- "The petitioner has failed to bring on record any document showing that the auctioned petrol pump is situated on the landed property owned by the petitioner or that he obtained a dealership from ADAIORE Gas Private Limited. The above said contention of the petitioner is not substantiated or supported from any legal document. Earlier objection petition filed on behalf of the petitioner was dismissed on 19.01.2016 wherein the merits of the application were fully discussed. Moreso, the order dated 19.01.2016 was not challenged before any higher forum by the petitioner which attained finality. From the gathered documents it appears the collusiveness of the petitioner with judgment debtors just to frustrate the decree of heaving amount passed in favour of the bank in the year 2013. The petitioner himself approached the hand writing expert of comparison of his signatures without getting property order from the court if any controversy was allegedly arisen So in the light of above discussion, this application is also dismissed".
8. We have noticed that there is nothing available on record to establish that the petrol pump is situated on the landed property owned by respondent No.3. In fact, in the absence of any demarcation of the landed property pledged by respondent No.3 for availing the finance facility in question, the Banking Court could not arrive at any conclusion to reject claim of the appellant that the petrol pump being auctioned was situated on his share of the property in the joint khata. Along with other relevant documents, the appellant has also placed on record a copy of the No Objection Certificate dated 28.10.2004 in his favour for establishing a new filling station as well as a copy of the application dated 05.04.2004 moved by ADMORE Gas Private Limited before the DCO Kasur seeking issuance of the aforementioned NOC to question findings of the Banking Court in that regard. No reference to any specific document has been made by the Banking Court to establish collusion of the appellant-objection petitioner with the judgment-debtor/respondent No.3 in order to frustrate the decree subject matter of the execution.
9. In Paragraph No.21 of the impugned order, rights of the auction purchaser namely, Ch. Muhammad Usman (respondent No.4) has been acknowledged by the Banking Court with the following findings:- "As per report of Nazar, the auction-purchaser namely Ch. Muhammad Usman has already deposited total auctioned amount of Rs.38,500,000/- in the court, so sale certificate of auctioned property be issued in his favour. Accordingly, Mr. Muhammad Sajid, Assistant Private Secretary, of this court is appointed as Court Representative, who is directed to get register the sale certificate from the concerned Registrar/Sub-Registrar. His fee is fixed as Rs. 30,000/- which shall be paid by the auction purchaser directly to the Court Representative within 7 days".
10. The appellants, who were neither the defendants, customers, borrowers, mortgagers, indemnifiers of guarantors of the decree holder Bank-respondent No.1, have been held by the Banking Court vide order dated 19.01.2016 to be not prejudiced in the auction proceedings of the property belonging to the judgment-debtor/Ali Hassan-respondent No.3. This Court has been informed that the sale certificate has been issued in favour of respondent No.4 pursuant to the aforementioned sale through auction. The impugned sale has been conducted without demarcation of the property vis-a-vis the appellant-Noor Hassan as well as the judgment debator, namely, Ali Hassan-respondent No.3. In the peculiar facts and circumstances of the case, we are inclined to set aside the impugned order dated 06.11.2018 and remand the matter for decision afresh on the objection petition filed by the appellant after demarcation of the disputed property through the Revenue Officer. The sale certificate issued shall be subject to the decision of the objection petition upon remand and depending upon that decision, shall be modified accordingly.
Accordingly. This appeal is disposed of.