1. ' Mrs. Syeda Feroza Khatoon is defendant No,2 in two Suits No, 1404/89 and 1405/89 filed by M/s. United Bank Ltd. For recovery of Rs,18,72,191.41 and Rs,10,08,451.15 respectively. She has filed two applications, one bearing C.MA. 388/90 under Order 37, Rule 3, C.P.C. And the other C.M.A. 2282/90 under section 5 of Limitation Act, 1908 in Suit No, 1404/89. Likewise she has filed two applicationg one bearing C.MA. No, 389/90 under Order 37, Rule 3, C.P.C. And other bearing C.MA. No, 2281/90 under section 5 of Limitation Act, 1908 in Suit No, 1405 of 1989.
2. Both the abovenamed suits were filed under the Banking Companies (Recovery of Loans)
2. Ordinance, 1984 in which she was required to obtain leave to appear and defend the suit. In Suit No, 1404/89 the principal debtor is one Mrs. Rehmat widow of late Sirajuddin Shaikh, Advocate, defendant No,1 and in Suit No, 1405/89 the principal debtor is Mrs. Sakina daughter of late Sirajuddin Shaikh, Advocate, defendant No,l. In both the suits, the said Syeda Feroza Khatoon, defendant No,2, is being sued as mortgagor of properties offered by her as security for repayment of cash credit granted by the Bank to the said principal debtor.
3. Defendant No, 2 is an Iraqi national and a permanent resident of Baghdad, but she occasionally visits Karachi. She owns two properties in Karachi, namely,(a) Show Room No,2-A, Ground Floor, Plot No,1 Khatiawar Cooperative Housing Society and (b) Bungalow No,R-27, 10th East Street, Phase I, Defence Officers Housing Authority, Karachi. Her father introduced her to one Sirajuddin Shaikh, Advocate who subsequently acted as her adviser and also managed her properties in Pakistan.
3. She was financially pressed hard at the time of purchase of the said Bungalow No, R-27 , 10th East Street, Phase I, Defence Officers Housing Authority, Karachi, and on the advice and through the good offices of the said Mr. Sirajuddin Shaikh, Advocate she got loan of Rs,1,00,000 from M/s. Allied Bank Ltd. Against deposit of title documents of her other property viz. Show Room No, 2-A, Ground Floor Zubeda Garden, situated on Plot No,I, Khatiawar Co-operative Housing Society, Karachi. She was asked by him to sign certain blank papers which she did, for the purpose of obtaining the said loan. However, after getting advance rent from her Defence Society Bungalow, she repaid it vide certificate dated 20-2-1990 from the Bank. On 28-3-1984, the sale-deed in respect of the Bungalow was presented. For registration, by her said Advocate, who had drafted it out and signed it as a witness. The slip/receipt of registration was endorsed by her in favour of her said Advocate to enable him to collect it from the office of the Sub-Registrar. On 20-1-1986, when she returned to Karachi from Iraq, she came to know that her said Advocate Mr. Sirajuddin Shaikh had died in 1984.
4. She contacted his son Israr, who could not find out her documents relating to the properties. On 25-2-1986, she went back to Iraq and again came back to Karachi, on 18-3-1986 and stayed here till 8-6-1986. It was during this period that she was supplied with certified copies of title documents by Israr and was told that the title documents of both the properties were deposited by his late father with the plaintiff-Bank for securing two loans, one in the name of his wife and the other in the name of his daughter. She was thus betrayed of confidence reposed by her in her Advocate. It also transpired that a forged power of attorney, alleged to have been executed by her was used for obtaining the loans against her said properties. Accordingly, she instructed her Advocate to serve a legal notice on the plaintiff-Bank, explaining the position and requiring them to return the original documents. This notice had remained unreplied by the plaintiff.
5. ' Thereafter she returned to Iraq and revisited Karachi for short periods and every time the said Israr s/o Sirajuddin Shaikh, Advocate assured her that he would get her original documents very soon and that substantial payments were made against the loans. On 20-1-1990, a friend of her father Mr. Taqi Haider informed her that he had read in the 'Morning News' that some suits had been filed by the plaintiff-Bank against her in the High Court. She made enquiries and came to know that summons in the two suits in question were published in daily `Morning News'.
6. ' Apart from the above averments made by defendant No,2 she has specifically alleged in C.M.A.
7. No,388 Of 1990 and C.MA. No,2282 of 1990 in Suit No,1404/89 that the memorandum of deposit of title deeds dated 29-4-1984 does not bear her signature and is a forged document. Her forged signature is in English and appears as "Foroza" when she in fact signs as "Feroza" and that too usually in Urdu. Besides, when the alleged memo. Of title deed is alleged to have been executed by her, she was outside Pakistan as may be borne out from her Passport beginning from 6-1-1984 upto 28-1-1986 as follows:-- "6-1-1984 Exit from Karachi to Baghdad 7-1-1984 Entry in Baghdad from Karachi 20-1-1984 Exit from Baghdad to Karachi 21-1-1984 Entry in Karachi from Baghdad 29-6-1984 Exit from Karachi to Baghdad 29-6-1984 Entry in Baghdad from Karachi 28-1-1986 Exit from Baghdad to Karachi 28-1-1986 Entry in Karachi from Baghdad."
8. ' Admittedly, publication of summons took place on 26-1-1990 in both the said suits and on 24-2- 1990 defendant No,2 filed her applications C.M.A. No,388/90 and C.M.A. No, 389/90 under Order 37, Rule 3, C.P.C. In both the suits.
9. ' The plaintiff Bank has refuted the various allegations made by the defendant No,1. It is contended that as per her own version, she became aware of the mortgage of the properties sometime in June, 1986 but she failed to take any civil or criminal action against the plaintiff-Bank thus she had acquiesced in and doctrines of waiver and estopple will come into play against her. It is denied that any fraud was committed on her as alleged. It is assessed that she was duly served with summons on 26-1-1990 and her application for leave to defend the suit was time-barred. Besides, she moved her application under section 5 of Limitation Act seven months after her application for leave to defend, hence the same is not maintainable.
10. ' In the first place, it was urged by Mr. Ali Ahmed Fazed learned counsel for the defendant No,2 that there was no due service on her as there is unrebutted evidence on record that she was a Foreign National and she was not present when the alleged service by publication took place. In suport reliance was placed by him on Full Court judgment of Allahabad High Court reported in AIR 1931 All: 727 in which it was stated:-- "The object of issuing a summons is to inform the party, against whom a suit has been instituted, of the fact, that there is a suit against him, and if he so chooses, he may come and defend it. If that be object of a summons, and if, for no fault of his own, a defendant was never put in a position to know that a suit had been instituted against him, whatever steps may have been taken for serving the summons on him, these steps can never be accepted as amounting to "due service". "When an order for substituted service is made by a Court, on the representation of a plaintiff, only one side is present before the Court and it acts on the representation of one party. Obviously it should be open to the defendant, when he appears to show that the method employed was not calculated to effect the purpose, which the Court had in view, namely informing the defendant of the institution of the suit. If this is so, the Court has to consider, in view of all the circumstances of the case, for example, the place where the defendant was when the summons was issued to him, where and how the summons was served, and so on, in order to see whether there was due service. For example, if a man has gone to Burma to earn a living and he has relations at home with whom he is in constant touch, and the summons is served on the defendant by affixation of a copy of it on the outer door of his house, it may be open to the Court to infer that the service was good, it being expected that the defendant's close relations, living jointly with him, in the same house, would inform him of the case. Again, where it is found that the defendant knew that a suit was likely to come and, in order that a summons may not be served on him, he leaves the place, it may be open to the Court to hold that there was due service by substitution. On the other hand, if the defendant went, say, to Burma to earn a living and left no one at home, which remained vacant, and at the instance of the plaintiff a substituted service was ordered by publication of the fact of the institution of the suit in a paper published, say, at Aligarh, where the suit was instituted, the Court would be in a position to hold that there was no due service.
11. ' The rule that substituted service is to be taken as effectual as personal service only means that the Court hearing the case may proceed with the suit as if the summons had been personally served on the defendant."
12. ' In AIR 1960 Punjab 153, the claimant was not subscriber to newspaper and substituted service on him in a newspaper was held to be not due service on him.
13. ' It was next contended by Mr. All Ahmed Fazed that even if service on the defendant is held good, in view of facts and circumstances of the case, she is entitled to extension of time for filing her applications for leave to defend the suit under section 5 of the Limitation Act.
14. Both the suits were filed by the plaintiff under the Banking Recovery of Loan Ordinance, 1979, which is a special law. Under Rule 8 of the Banking Companies (Recovery of Loans) Rules, 1980 made thereunder a defendant is required to be served through the bailiff, by Registered Post Acknowledgement Due and by publication and service in any of the modes shall be held good as was also held in Ahmed Autos v. Allied Bank of Pakistan Limited, PLD 1990 SC 497. Such being the case, the provisions relating to service of summons under the Code of Civil Procedure fade into insignificance unless they are in consonance with or complementary to Rule 8 of the Banking Companies (Recovery of Loans) Rules, 1980. Substituted service under Order 5, Rule 20, C.P.C. Which may include service through publication is the last resort for effecting service of summons on a defendant but service by publication under Rule 8 is placed on a higher pedestal as it is as good service as personal service on a defendant through the bailiff or by Registered Post Acknowlegemcnt Due. There may arise hardship cases where a defendant cannot possibly be served either through a bailiff or by Registered Post A.D. But is being served as a matter of course under Rule 8 behind his back and is deprived of right to apply for leave to defend himself. The Full Court judgment of Allahabad High Court referred to above by Mr. Ali Ahmed Fazed, learned counsel for the defendant No,2 may be helpful only in gauging the bona fides of defendant No,2 and to examine if she has made out a case of extension of time under section 5 of the Limitation Act.
15. It is not controverted by the plaintiff that the defendant is a Foreign National nor the fact that after reaching Karachi in February, 1990, on 20-2-1990 she obtained the knowledge of the institution of the suits from the said Mr. Taqi Haider who has also filed his personal affidavit confirming her version. Mr A.I. Chundrigar, learned counsel for the plaintiff although raised objection that the Defendant's application under section 5 of Limitation Act was belated, has not been able to show that it was barred by time. No period is prescribed for filing an application under section 5 of Limitation Act, therefore the residuary Article 181 of Limitation Act, will be applicable which prescribes a period of three years from the date when the right to apply accrues to an applicant. In the present case the defendant's application under section 5 of Limitation Act was filed after seven months and therefore within time. The grounds set out in her applications under section 5 of Limitation Act in support of her application under Order 37, Rule 3 inspire confidence and is supported by documentary evidence. Accordingly I grant both her applications under section 5 of Limitation Act.
16. With regard to the applications under Order 37, Rule 3, C.P.C. For leave to appear and defend the suit, there are plausible grounds and disputed questions of facts which cannot be overlooked. I accordingly grant to Defendant No,2 unconditional leave to appear and defend the suit with direction to file written statement in both the suits within two weeks hereof.
17. ' In the result, C.MA. Nos.2287/90, 2281/90, 388/90 and 389/90 are allowed.