' This is an application for leave to defend in a suit for recovery of Rs,18,79,446.13 under the Banking Companies (Recovery of Loans) Ordinance, 1979.
2. {{PAGE CUT}}A number of pleas were taken in the application which n( not be repeated. Mr.Azhar Ali Khan, Advocate mainly contended C the plaintiff had withdrawn the 0/D facility, which was granted him, all of a sudden and had thus put the defendant to great for He further submitted that the plaintiff has charged exorbitant inter and in certain cases beyond the rate agreed 'between the parties. Has therefore prayed for grant of leave to defend on these I grounds. Ft has also been pointed out that immovable property I been mortgaged and the loans have been fully secured and therefi permission can be granted unconditionally as there is no necess for obtaining any -further security from the defendant.
3. Mr.Azhar All Khan has Cited certain rulings. I would t them one by one. The first is PLD 1984 Kar.257 (Habib B Limited v. K.P.I. Company Ltd.). In this case unconditional le was granted to defend the suit on the ground that although defendant was not denying loan/O.D.Facility but he had pleaded tl the loan was given with specific understanding involving furtl investment with the plaintiff's consent. It was observed Saeeduzzaman Siddiqui, J. As follows:- "From reading of the above averments made in the affidav filed in support of leave application it is quite clear that 1 defendants have not denied the loan/overdraft facility to tt but have pleaded that the loan was given by the plaintiff w. Specific understanding that out of the total amount of loarl sum of Rs,93,00,000 will be applied towards purchase of 1 shares of Karachi Properties Investment Company (1974) Lt< Rs,8,80,000 for payment to Grindlays Bank Limited to ell the balance loan pending with them and Rs,2,00,000 towaj payment ofstamp duty on mortgage deed. It is further- alleE that the sum of Rs,93,00,000 was utilized out of the abc . Amounts by Karachi Properties Investment Company (1974) L but shares of the equivalent value were not issued to defenda under the instructions of Plaintiff."
' It is quite clear that the facts of this case are qu distinguishable from the present case. In the present case no su direction was given by the Plaintiff to the defendant to invest I loan nor there are any other factors in this case parallel to I factors under which permission was granted in the case in the abc ruling.
' The second case is of Azmat Wali v. Adawi and 2 oth( reported in 1983 CLC 546, where Nasir Aslam Zahid, J. Has swim up the general principles for grant of leave in the following terms: "Following general principles can be enunciated in regard the grant or refusal of leave to defend a suit filed unc Order XXXVII of the Civil Procedure Code, 1908;
(a) If no defence is spelt out, on facts or in law, in the applicati for leave to defend or documents filed by the defendant, lea is to be refused. Result will be that the suit shall be decree
(b) if any kind of defence is made out, be it plausible or ev illusory, the defendant is to be granted leave to defend t suit;
(c) if leave is to be granted to the defendant to defend the suit, it can be unconditional leave or conditional, depending on the strength of the defence, whether on facts or in law, is made out, unconditional leave is, as a general principle, granted;
(d) even if the defence is plausible, leave may not be granted unconditionally if the conduct of the defendant is male fide or, is not free from suspicion;
(e) if a defence is set up which is not plausible, leave to defend should not be refused but should be granted on condition of furnishing security or deposit of amount. Such cases will be where, to adopt the words employed by the Supreme Court of Pakistan in PLD 1963 SC 163 'the defence set up be vague or unsatisfactory or there be a doubt, as to its genuineness';
(f) whether conditions are imposed or unconditional leave to defend is granted, the appellate Court generally does not interfere as this is the discretion to be exercised by the trial Court. If, however, the discretion is exercised arbitrarily, the appellate Court will interfere;
(g) a suit can be filed under Order XXXVII, C.P.C. On the basis of -a promissory note even if it was given as collateral security for repayment of a loan. Mere argument that it was a collateral security will not entitle the defendant the right to defend the suit." {{PAGE CUT}}
4. To say least this ruling does not help the defendant at all id on the contrary goes against him because it has been held in pry clear terms that if no defence is spelt out on facts or in law in e application for leave to defend or documents filed by the defendant en leave is to be refused. It was further clarified that a suit can filed under Order XXXVII, C.P.C. On the basis of promissory )te even if it was given as a collateral security for repayment of f loan. Mere argument that it was a collateral security will not Ititle the defendant the right to defend the suit.
' The third ruling is in case of Mohammad Hussain v. City ink reported in 1985 CLC 2467 in support of the contention that ndition of furnishing security should not be imposed in a case sere the loan was already secured by means of a mortgage. This ding also does not help the defendant because it has been made ear that it was the quality of the defence and not the extent of curity which should be the governing factor in such cases.
5. it was rightly pointed out by the counsel for the plaintiff at the case of the plaintiff is fortified by a number of documents eluding promissory notes, acknowledgments, pledge-deed, letters, atements of accounts produced by the Plaintiff. The execution of most all of these documents was admitted by the defendant or was A least not denied. So much so that he had not denied the documents which even the last debit balance was admitted by him. In the ce of all these documents and their non-denial, further coupled ,th the fact that the defendant has not denied having obtained an/O.D. Facility and having utilized the same, there remains no !Fence what to say of a plausible defence, with him.
6. So far as the question of interest is concerned it was stated by the Advocate for the plaintiff from bar that interest has not been charged in excess of the agreed rate and that such a statement has been made in the plaint which has been verified on oath.
7. Under these circumstances I am of the clear view that the defendant has not been able to set up any defence and is therefore not entitled to leave for appear and defend the suit. I, therefore, dismiss his application for leave to defend the suit. As a result of the dismissal of the application the suit of the plaintiff is decreed as prayed with interest at 14% per annum with quarterly rest from the date of the suit till payment and also with costs. These are the reasons for the short order dated 17-8-1987.