' MIAN MUHAMMAD AJMAL, J.---This regular first appeal is directed against the judgment/decree of Banking Judge, N.-W.F.P., Peshawar dated 5-8-1993 whereby the application of the defendant- appellant for grant of permission to appear and defend the suit was dismissed and the suit of plaintiff-Bank against the defendant was decreed with costs alongwith interest at the contracted rate or 2% above the Bank rate, whichever is higher.
2. The defendants-appellants were granted financial assistance under I.DA. Credit Scheme vide Sanction Advice No, WB/UBL-17 dated 11-11-1982, a sum of Rs,5,00,000 was advanced as loan. The defendants as security executed the registered mortgage deed No, 1106 deed No, 1106 dated 17-11- 1982 in favour of the Bank and Demand Promissory Note dated 20-11-1982 for Rs,5,00,000. The defendants-appellants failed to adjust the loan liabilities according to the terms and conditions of the deed, therefore, they were served with legal notice but to no effect. Hence suit for recovery of outstanding dues amounting to Rs,14,52,379 was filed by the plaintiff-Bank on the basis of statement of account with effect from 20-11-1982 to 30-6-1990 alongwith the future interest at the rate of 11% per annum till the final payment. In pursuance to the summons the defendants- appellants filed an application under Order 37, Rule 3, C.P.C. Read with section 7(2) of the Banking Companies (Recovery of Loans) Ordinance, 1979 (hereinafter called Ordinance) for leave to appeal and defend the suit. The learned Banking Judge N.-W.F.P., Peshawar vide judgment/decree dated 5-8-1993 dismissed the defendant's application and granted decree to the plaintiff/respondent with costs alongwith interest at the contracted rate or 2% above the Bank rate, whichever is higher.
Hence the present appeal.
3. Learned counsel for the respondent-Bank raised a preliminary objection that the appeal under section 12 of the Ordinance was to be filed within 30 days from the impugned judgment/decree, while the instant appeal was filed after about six months, hence it being hopelessly time-barred be dismissed. Responding to the objection, the learned counsel for the appellants submitted that after the decision of the case the appellants fell seriously ill and thus could not apply for the copy of the judgment in time. After recovery he obtained the copy and filed the appeal. The application for condonation is 'supported by an affidavit to which no counter-affidavit has been filed, hence the assertion made on the affidavit are accepted and the application is allowed.
4. Under subsection (2) of section 7 of the Ordinance, the banking company or the borrower can file a suit in the Special Court which is based on negotiable instruments, statements of accounts, personal undertakings to repay the loan or on .Mortgage of any kind, and, where, loan has been secured primarily on mortgage security in that case Order XXXIV, Rule 1, C.P.C. Would come into operation. From para. 4 of the plaint it is evident that the loan was advanced against security of Demand Promissory Note dated 20-11-1982 and Registered Mortgage Deed No, 1106 dated 17-11-1982 but the learned Court in the operative part of the impugned judgment/decree did not at all refer to the mortgage security and dismissed the application for leave to defend the suit on the ground that the defendants failed to disclose any plausible defence. Under Order XXXIV, Rule 4, C.P.C. a preliminary decree has to be passed in a suit based on mortgage security and if the defendant fails to pay the amount due from him within specified period, if so fixed, then the plaintiff can apply for the final decree. In the instant case, the learned Judge Banking Court failed to pass a preliminary decree, hence such a decree being in consistent with the aforesaid legal provision, requires rectification. Consequently we allow this appeal, set aside the impugned judgment and decree to this extent and remand the case to, the Special Judge, Banking Companies to rectify the error in view of the observations made above.
5. Learned counsel for the appellants states that the bank had, agreed to allow certain concession to the appellants and undertakes that the appellants shall deposit the principal amount in the bank within six months. On deposit of the principal amount as promised, the bank may consider the possible concession, if any, in interest payable by the appellants.