1. ' This suit has been filed by the plaintiff under section 7 of the Banking Companies (Recovery of Loans) Ordinance, 1979, for recovery of Rs,11,15,604 with interest at the rate of 16% per annum from the date of the filing of the suit till payment.
2. ' According to the plaintiff, defendant No,1 opened an account in the name of defendant No,2 in the main branch of the plaintiff in 1976. In 1983, the plaitiff, at the request of the defendant No,1, granted under 'Export Refinance Scheme' a loan of Rs,5,00,000, which if not repaid within six months, carried an interest at 4% per annum above the bank rate at minimum rate of 14% per annum payable quarterly. The loan was secured by continuing security of raw material, lien on export L/Cs and collatoral security of equitable mortgages of Plot No,B-337, Sector 25, Block A, KDA Scheme No,33, Karachi, property bearing No,A-60, Block 5, K.D.A. Scheme 24, Gulshan-eIqbal, Karachi and Property bearing No,B-336, Sector 25, Block A, K.D.A. Scheme No,33, Karachi, mortgaged by defendants Nos.1, 3 and 4 respectively. The defendants defaulted in payment of the said loan with the result that at the time of the filing of the present suit an amount of Rs,11,15,604, inclusive of interest, stood due against the defendants for recovery for which the suit has been filed.
3. ' Application for leave to defend filed on behalf of defendants Nos.1 and 4, was dismissed in so far as the principal amount was concerned, and to the extent the suit was decreed against the defendants jointly and severally on 20-6-1991. As regards the amount of interest, leave to defend was granted to the defendants Nos.1 and 4.
4. ' Subsequently, the following Issues were adopted: ' Whether in view of the order dated 20-6-1991, the plaintiff is not entitled to a decree to the extent of its claim for interest on the principal amount of Rs,5,00,000, at the agreed rate of 14% per annum with quarterly rests as per Statement of Accounts, Annexure 'M' to the plaint?
(2) Whether or not the plaintiff is entitled to interest on the suit amount with effect from the date of filing the suit till realization of the decretal amount?
(3) Whether or not the plaintiff is entitled to costs of the suit?
(4) What should the decree be in respect of claim of interest?" Issues Nos.1, 2 and 4 are inter- related and may be taken up together.
5. ' In support of its claim, the plaintiff has examined Muhammad Amin Memon, one of its officers, who produced verious documents including Statement of Accounts (Exh.5/1), Promissory Note (Exh.5/2), Memorandum of deposit of title documents (Exh.5/4), and title documents of the properties, (Exhs.
6. 5/5, 5/6 and 5/7). In the cross-examination of this witness by the counsel for the defendants, the amount claimed as interest in the Statement of Account, has not been challenged. The cross- examination seems to be confined to the despatch of the statement of account and correspondence by the plaintiff-bank to the defendants.
7. ' The sole ground on which Mr. Nuruddin Sarki, the learned counsel for the defendants, challenged the plaintiff's claim for interest before me was that by virtue of Article 2A of the Constitution of the Islamic Republic of Pakistan, 1973, the provisions with regard to the charging of interest under the Banking Companies (Recovery of Loans) Ordinance, 1979, the Code of Civil Procedure and other statutes, being repugnant to the Injunctions of. Islam, had become ineffective as, the validity of such provisions had to be tested on the touch-stone of the said Article 2A. In support of his contention, he placed reliance on the cases of (i) Bank of Oman v. East Trading Co. Ltd. And others (PLD 1987 Kar. 404), (ii) Habib Bank Ltd. v. Muhammad Hussain and others (PLD 1987 Kar. 612) and Aijaz Haroon v. Inam Durrani (PLD 1989 Karachi 304).
8. ' However, in the case of Mst. Kaneez Fatima v. Wali Muhammad and another (PLD 1993 SC 901), the scope of Article 2A of' the Constitution came up for consideration before their Lordships of the Supreme Court. In para. 5 of the judgment it has been observed: "5. The question arises whether the principles of Hakim Khan's case (supra) can be applied to cases where the provision of any enactment and not the Constitution is to be considered and challenged on the plea that it is hit by Article 2A. As is obvious from the aforestated weighty observations, Article 2A cannot be pressed into service for striking down any provision of the constitution on the grounds that it is not self-executory and also that another provision of the Constitution cannot be struck down being in conflict with any other provision of the Constitution.
9. The last principle enunciated may not be applicable while dealing with provisions of any enactment which may be in conflict with the provisions of the Constitution. The difference in Constitutional provisions which are not 'self-executing and which are self-executing has been laid down by our learned brother Shafiur Rehman, J. In Hakim Khan's case and reliance has been placed on Bindra's Interpretation of Statutes, 7th Edition. The self-executing provision not only confers a right but it provides for its protection and a further duty is cast to enforce it without the aid of legislative enactment. There may be supporting legislative enactments which may flow from such self-executing provisions of the Constitution, but they ill not change the character of the self- executing provisions of the Consitution nor will they be dependent upon such supporting legislation. But where merely a 'policy has been laid down or some guidelines have been provided', they are dependent upon supporting legislations and enactments because without them the same cannot be enforced by themselves. Sometimes, as in our Constitution, procedure is provided for enforcing or making such non-self-executing provisions operative. Therefore, in such circumstances, the non-self-executing provisions of the Constitution serve as a beacon light for the enactment of laws by the Legislature and also for making rules and regulations which have the force of law."
10. ' And again, in para 9 of the judgment, the following observations may be relevant:"9. Article 2A is one of the provisions of the Constitution which strives at bringing the existing laws in conformity with the Injunctions of Islam and also see to it that no law in conflict with such Injunctions is legislated. The method for testing such legislation and enactments has been provided under the Constitution. One is provided in Article 227 in Part IX of the Constitution and the other and more effective method is provided by Chapter 3-A of Part VII of the Constitution, that is the Federal Shariat Court. Article 203-D vests powers and jurisdiction in the Federal Shariat Court to examine and decide the question whether or not any law or provision of law is repugnant to the Injunctions of Islam. On coming to an affirmative answer it shall give its decision with reasoning for holding such an opinion and shall specify the day on which the decision shall take effect. However, if any party files an appeal before the Supreme Court, effect shall not be given till such time the appeal is disposed of. Consequences of declaring any law or provision of law to be repugnant to the Injunctions of Islam are contained in Article 203-D(3). The President and the Governor in cases of law within their respective jurisdiction shall take steps to amend the law so as to bring such law or provision of law in conformity with the Injunctions of Islam and such law or provision of law shall cease to have effect on the day on which the decision of the Court takes effect. Therefore, a proper scrutiny of the provisions of law by the Federal Shariat Court and the Shariat Appellate Bench of the Supreme Court with an interregnum period has been provided to enable' the President and the Governor, as the case may be, to move the Legislature to bring the law in conformity with the Injunctions of Islam. The intervening period has been provided to enable the Legislature to legislate proper laws and there may not be a vacuum of lawlessness which may create complications and confusion. The process of Islamisation of the laws is an important and difficult subject. The lead given by Pakistan in-this regard is being watched with interest by all the Muslim countries who are anxious to bring their laws in conformity with the Injunctions of Islam and by the non-Muslim countries as well. Any hasty action without the process of Ijma at Ummah level may lead to difficulties and confusion which may prove irreversible. Furthermore, due to sudden thange, complex problems in economic, commercial and financial fields may arise creating difficulties.
11. However, it does not mean that in the fear of such new controversies and problems the process of Islamisation may be retarded or stopped. It is an ongoing process. It has to take effect with utmost despatch, vision and regularity. The authorised agencies under the Constitution are not to wait for any case or reference to come to the Court or to the Council, but they can suo motu take up the laws or the provisions of laws and examine them on the test of Islamic Injunctions.
12. ' The situation which crystallises is that for existing laws and proposed laws Constitutional dispensation has been provided to bring them in conformity with the Injunctions of Islam which is required to be followed. At this stage it is pertinent to point out that the Courts are not vested with the jurisdiction to declare a law void on the touchstone of Article 2-A as distinguished from Article 8"
13. In view of the above decision, it would appear that no provision of a statute can be struck down by the Courts on the touchstone of Article 2A of the Constitution as, for doing so, a separate mechanism is provided by the Constitution itself.
14. ' Such being the case, it may perhaps not be possible for this Court to stike down the provisions of the Banking Companies (Recovery of Loans) Ordinance, 1979, or C.P.C. Or other statutes with regard to interest on the basis of Article 2A of the Constitution, all the more so when the Court is exercising limited jurisdiction as a Special Court under the Banking Companies (Recovery of Loans)
15. Ordinance, 1979.
16. In the circumstances, the contention of Mr.Nuruddin Sarki cannot be accepted. Plaintiff's claim was not challenged on merits or on any other ground, as such, the plaintiff would be entitled to interest on the principal sum of Rs,5,00,000 at the rate of 14% per annum payable quarterly as claimed in the statement of accounts up to the date of the filing of this suit and, thereafter, at the same rate up to realisation. Issues Nos.l, 2 and 4 are decided accordingly.
17. As regards issue No,3, in view of the fact that the plaintiff has succeeded to the full extent of its claim, there is no reason not to allow costs to it. The defendants' counsel has also not urged any ground for not granting costs to the plaintiff. As such, I hold that the plaintiff would be entitled to costs.
18. ' Accordingly the suit is decreed against the defendants jointly and severally for Rs,11,15,604 as claimed, with interest thereon at the rate of 14 per cent. Per annum payable quarterly from the date of suit till realisation and costs of the suit.
19. The defendants Nos.1, 3 and 4 have also been sued as mortgagors. It is, therefore, further declared that the sum due to the plaintiff on the mortgage is Rs,11,15,604 with interest thereon at the rate of 14 per cent. Per annum payable quarterly from the date of the filing of the suit till realisation, and cost of the suit. Let preliminary decree in From 5-A of Appendix ' D' to the First Schedule of the C.P.C. Be prepared.