In this suit for recovery of Rs.1,16,55,355 under the Banking Companies (Recovery of Loan)
Ordinance as well as declaration with regard to legality or otherwise of the Morabaa transactions between the parties, authority of the defendant Bank to charge mark-up and the sale of shares and securities belonging to plaintiffs as without lawful authority and a claim for damages on account of harassing and mental torture, defendant-Bank seeks leave to defend the suit tinder the provisions of Order XXXVII, Rule 3, C.P.C.
2. From the material on record, it appears that there was an agreement between the parties to allow facility to the tune of Rs.60,00,000 which was later raised to Rs.1,15,00,000 on Morabaa basis with hypothecation of goods and pledge of shares of the public limited companies. A number of documents were exchanged between the parties and all went well for some time when the facility was not renewed and the defendant-Bank called upon the plaintiffs to pay up the amount outstanding against them alongwith mark-up.
3. In support of its application for leave to defend, defendant-Bank has filed a copy of the plaint filed against the plaintiffs in Suit No. 1163 of 1994 for recovery of Rs.21,28,573 and liquidated damages worth of Rs.4,25.714 and a number of other documents to show the transactions between the parties Referring to the documents on record, it is contended that the defendant-Bank has disposed of a large number of shares pledged with it by the plaintiffs, without their permission in the market and adjusted sale proceeds towards their account.
4. On a careful scrutiny of the rival claims of the parties as well as relevant documents on record, I am of the considered view that the defendants have raised arguable issues which required determination after recording evidence.
5. Even otherwise defendant foreign Bank is established under a licence from the State Bank of Pakistan under the law and also registered under the provisions of Companies Ordinance, 1984, therefore, the claim of the plaintiffs, if decreed is riot likely to be defeated as the Bank obviously has huge assets at its credit.
6. There is another aspect of the case. The plaintiffs have asked for a number of declarations which involves serious questions of law and fact and cannot be determined under the summary procedure prescribed in the Civil Procedure Code. Such determination would require recording of evidence by both the parties and is again a circumstance relevant for the grant of leave asked for.
7. In my view a fit case for the grant of unconditional leave is made out. I, therefore, grant leave to defend and allow the defendant-Bank to file parawise written statement within- four weeks. This disposes-of C.M.A. No. 2586 of 1994.