JUDGMENTAM. TIWANA, J.- Learned counsel for the petitioner informs that his client has been released by the respondents.
2. In this writ petition Muhammad Yasin petitioner calls in question the recovery of compound penal interest along with the principal amount by the respondents from his through coercive measures, as also his detention in civil prison/judical lock-up in Kot Addu by respondent No.3 for the recovery of loan.
3. The allegations in the writ petition are that on 27.2.1989 the petitioner had raised a loan of Rs.299,000/- from the Agricultural Development Bank, Kot Addu (respondent No.2) for the purchase of agricultural implements after mortgaging his landed property worth Rs.8 lacs approximately.
The loan so raised was to be paid in 8 equal annual instalments with an interest at the rate of 12% plus 3% additional charge for belated repayment, during the period from 7.7.1990 to 7.7.1997. He went on depositing various amounts at different occasions with the respondent-bank and he has always been ready to pay the instalments of the remaining amount of loan but despite these payments and sufficient security available with the Bank in the form of mortgaged land, Tehsildar recovery Kot Addu, District Muzaffargarh (respondent No. 3) illegally arrested the petitioner on 17.5.1993 and released him on 24.3.1993. He re-arrested him for the third time on 13.6.1993 and at the time of moving this writ petition he was still in civil prison at Kot Addu. He also complained that the tried to obtain the copies of the order for his detention as also the details of the outstanding loan against him but respondent No.2 refused to supply the same and resorted to un-lawful means by getting him arrested and detained in civil prison. He urged that the action taken by the respondents was pre-mature and against the policy decision announced by the Prime Minister of Pakistan under the Caption Agricultural Reforms Package for Farmers as contained in Circular letter, dated 20.4.1992 of the Federal Bank of Co-operative Islamabad. He also challenged the recovery of interest in view of the Provisions of Enforcement of Sharia Ordinance 1988 being repugnant to the Injunctions of Islam.
4. Vide interim order, dated 22.6.1993, respondents No.2 and 3 were asked to appear with record and submit their para were comments on the writ petition. Meanwhile they were directed to immediately release the petitioner from the custody and refrain from re-arresting him till further orders. In response to that order, respondents No.2 and 3 represented by Mr Abdul Latif Khan Lodhi, advocate, have put in appearance. They have, however, not filed the para were comments nor they have requested for adjournment for that purpose, rather, the learned counsel has straightaway addressed arguments opposing the writ petition on behalf of his clients. He has contended that the petitioner is a defaulter and by this time he has not paid even one full instalment out of eight annual instalments and he has made a mis-statement that he has so far repaid a sum of Rs.81,000/- out of the loan amount of Rs.229,000/-.
5. In reply to the contentions of the learned counsel for the petitioner, who has almost reiterated the contents of the writ petition, he submits that the action of respondents No.2 and 3, regarding the arrest and detention of the petitioner in the civil prison, was within the ambit of law as he was a defaulter in the repayment of loan instalments. In this connection he refers to section 25 of the Agricultural Development Bank Ordinance 1961 and sections 80 to 85 of the Land Revenue Act. For the convenience of reference section 25 ibid is re-produced hereunder:- "(1) Where any agriculturist who is under liability to the Bank under agreement makes default in repayment or otherwise fails to comply with the terms of his agreement with the Bank, such default or failure not being due to natural calamity, the Bank may, subject to any rules made in this behalf, take over the management of the concern of the agriculturist and sell or realise any property pledged, mortgaged, hypthecated or assigned by the agriculturist to secure his liability to the Bank.
(2) All same due to the Bank shall be recoverable as arrears of land revenue.
(3) /*7 No doubt, sub-section(2) of section 25 supra empowers the i^gricultural Development Bank to recover all sums due, which include the principal amount of loan and interest accruing thereon, as arrears of land revenue but it cannot straightaway resort to the coercive processes of arrest and detention. For securing repayment of loan the Bank invariably enjoins its loanees to mortgage immovable property of sufficient value in its favour and if they make default in the repayment of loan to it in violation of the conditions of the loan agreement, the proper course for the Bank, in the first instance, is to take over the management of the concern of the loanee or agriculturist and realise its loan from its income but if this course does not prove efficacious for the recovery of full loan, then it can sell any property of the agriculturist or loanee pledged, mortgaged, hypothicated or assigned to it as required by sub-section (I) of section 25 of the said Ordinance.
6. Arrest and detention of a person is an extreme step because it involves his liberty and honour which cannot be violated in routine. The coercive method of his arrest and detention has to be the last resort because it is a penal action. In the instant case, it is an admitted position that the loan advanced by the Bank (respondent No.2) to the petitioner stands adequately secured by obtaining the mortgaged of his land worth more than the amount of loan raised by him. Therefore, an option was available to the Bank first to sell out the mortgaed property of the petitioner or any portion thereof and if some part of the loan still remained un-realized, only then he could be arrested and detained. In fact, to my mind, the scheme of recovery of arrears of land revenue as envisaged by sections 82 to 88 of the Land Revenue Act, 1967, to which sub-section (2) section 25 ibid alludes, does not squarely fit in the scheme of things because those provisions are meant for the recovery of land revenue from defaulting land owners whose land obviously does not stand pledged, mortaged or hypothecated to the Government or, for that matter, to the Revenue Authorities, while in case of loan raised under the Agricultural Development Bank Ordinance 1961 a sufficient security by way of mortgage or hypothecation of immovable property of the loanee is. Available to the Bank. In this connection, rules 19, 20 and 2l of the Agricultural Development Bank Rules 1961 which also reflect the intention of section 25 (1) ibid, so far as it relates to the take over of the management of the concern of the agriculturist, are also relevant.
7. In view of the above, the writ petition, which is formally admitted to regular hearing, is accepted to the extent that the arrest and detention of the petitioner by respondent No. 3 at the instance of respondent No. 2 was without lawful authority and the instalments of loan along with the interest due from him is, in the first instance, recoverable from the property mortgaged by Him in favour of the Bank and if any part of the loan and interest still remained un-realized, only then the process of his arrest and detention will be resorted to. Parties are left to bear their on costs.