1. ' WAJIHUDDIN AHMED, J.---Suits Nos. 903 and 904, both of 1990, were filed on the original side of this Court for recovery by the respondent-plaintiff against the appellant-defendant. Such suits were based on purportedly friendly loans of Rs,10,00,000 and Rs,7,50,000 respectively. Supporting documents consisted of agreements, demand promissory notes and receipts. Recoveries, upon alleged defaults, were sought of the principal amounts, as well as profits/marks-up at the agreed rate of 3.5% per month. In each suit, leave to defend was granted subject to furnishing security.
2. These orders were passed by consent, upon condoning delay, again by consent, relevant to the applications for leave. Admittedly, in neither suit security was furnished. , Decrees, therefore, followed. The defendant preferred High Court Appeals, but such were withdrawn on 15-2-1994. This was followed by filing applications under Order XXXVII, Rule 4, C.P.C. In both the suits, apparently, in March, 1994. Such applications were dismissed by separate orders passed on 29-1-1995, giving rise to the present appeals. On 19-12-1995, upon hearing the learned counsel, a Division Bench of the Court, presided over by me, recorded the undernoted contentions of the learned counsel bringing forth the questions emerging for examination:- "Mr.Mamnoon Hassan has pointed out that the Federal Shariat Court Judgment, whereby Riba was held to be un-Islamic, has been appealed against and the West Pakistan Money Lenders'
3. Ordinance, 1960, which, inter alia, was declared to be repugnant thereby, still holds the field. Mr. Mamnoon Hassan further says that neither in the appellant's application under Order 37, Rule 3, for leave to defend nor in the appellant's application under Order 37, Rule 4, C.P.C., for recall of the decree, was it pleaded that the respondent was a money-lender, without having been duly licensed and therefore the suit was barred. What is more, according to Mr. Mamnoon Hassan, even in the Memo. Of appeal such a plea has not been taken.
4. ' Be that as it may, we asked Mr. Muhammad Sharif to argue the question purely as a question of law, subject to what has been urged as above. Mr. Muhammad Sharif has pointed out that the applicable provisions in the Money-Lenders' Ordinance are sections 10, 14 and 15 and the words 'Money-Lender' and 'Loan' have been defined by the Ordinance itself. According to this contention, the word 'Loan' is pointedly elaborated and means an advance of money or in kind at interest'. The moment, therefore, a Court encounters such a loan in a suit, which loan does not fall within the exceptions in the definition, it has to examine in terms of section 10 whether or not the person extending the loan is or is not a money-lender and only when it is found that he is either not a money lender or is a licensed money-lender, satisfying the. Conditions of the Ordinance, the Court can proceed to decree the suit.
5. ' In order to assess the above contentions we would like copies of the plaint and of the promissory note to be placed on record and to be assisted by case-law, if any, on the aforesaid concepts in the Money-Lenders' Ordinance."
6. ' We have been addressed by the learned counsel upon the premise that, if necessary, the appeals would be heard, admitted and disposed of at the same time. Mr. Muhammad Sharif for the appellants, referring to Ali Khan & Company v. Allied Bank of Pakistan Limited PLD 1995 SC 362, and a case from Indian jurisdiction viz. Ramkarandas Radhavallabh v. Bhagwandas Dwarkadas AIR 1965 SC 1144, has contended that a Court acting under Order 37, C.P.C., when either leave to defend is not applied for or, if applied for, is declined or granted conditionally, the condition not being fulfilled, has still to examine the case of the plaintiff before decreeing the suit. This, according to the learned counsel, was not done and decrees in the two suits came to be passed in a mechanical manner, which was impermissible. He says that the 'Loan' advanced fell within the defined parameters of section 2(1) and the respondent was a money-lender, falling within section 2(m) of the Ordinance, the first because the loan was advanced on exorbitant interest and the second because the respondent was carrying on the business of advancing loans. Now, a. Suit for recovery is to be dismissed under section 10 of the. Money-Lenders' Ordinance, 1960, if, at the time of its institution, the money-lender does not hold an effective licence etc. Section 14 of the Ordinance requires accounts to be maintained and furnished by money-lenders. The following section, namely section 15, requires the Court, in any suit or proceedings relating to a 'Loan', to frame and decide an issue, before touching merits, whether or not the relevant provisions of section 14 have been satisfied by the money-lender concerned. Needless to state that such provisions get attracted only if express allegations are made that the plaintiff in a suit carries on the business of advancing loans. Proof of course may follow.
7. ' It seems to us that for the purposes of the West Pakistan Money-Lenders' Ordinance, it is not enough that the 'Loan' advanced be one carrying interest or coming up, to be encountered, is a 'transaction which the Court finds to be in substance a loan'. Many a men may, while driven to an isolated transaction, be tempted to charge interest but that alone may not always suffice. It must also be found that the loan was advanced by a person carrying on the business of advancing loans. For this, as found in Mubarakali v. Inayat Hussain PLD 1980 Karachi 254, a single transaction or a couple of them would not render the loan to be one qualifying under the Ordinance nor the lender a money-lender. As it is, one swallow does not make a summer. Precise allegations and transactions, having some frequency, have to be brought out and proved for such a purpose. That, apparently, was not done. All that has been spot-lighted by the defendant-appellant is the apparent usurious nature of the loan and two successive transactions covered by the suits.
8. Necessary allegations were not made at the time the applications for leave to defend were filed and because the suits dame to be decreed upon the condition for leave remaining unsatisfied, no question of proof arose anyway. It was, therefore, clearly not plausible to find the loan to be one as defined in the Money-Lenders' Ordinance or the creditor to be a money-lender at any time, either antecedent to the decree or in the decree itself. It cannot, therefore, be said that the Original Side Court decreed the suits in a mechanical manner or without taking into consideration the salient features of the suits.
9. It was only at the stage when the appellant-defendant filed his applications under Order 37, Rule 4, C.P.C. In the two suits that a plea as to money-lending seems to have been taken for the first time and that too somewhat cursorily. Even then, no supporting material was placed on record. As is too obvious, pursuant to Order 37, Rule 4, C.P.C., a decree passed in terms of the preceding provision namely, Order 37, Rule 2, cannot be recalled unless 'special circumstances' are pleaded and show to exist. Even if we assume for the sake of argument that the transactions carried a taint of the Money-Lenders' Ordinance, such were not established to be so, making the impugned order unexceptionable. Here we may also dispose of an argument of Mr. Muhammad Sharif, founded on Manager, Jammu and Kashmir, State Property v. Khuda Yar PLD 1975 SC 678, that because the original decree was void and a nullity, such could be discarded at the stage of the proceedings under Order 37, Rule 4, C.P.C. That patently does not arise because, as already stated, necessary foundation for the purpose was not laid, and the allegations as to money-lending were at no stage substantiated.
10. ' This takes us to a plea from the side of the respondent that the decrees in the suit having attained finality, such could not be recalled in a proceeding under Order 37, Rule 4, C.P.C. That in the contention of the respondent arose because the original decrees were appealed against and the appeals were withdrawn. The argument may not be totally wide of the mark because, in the first place, such pleas were open at the leave granting stage and in any case could be agitated in appeals from the decrees after the conditions of the leave were not satisfied and the decrees came to be passed. As against this, however,Mr. Muhammad Sharif relies upon Jogendra Nath Banerjee v. Khoda Buksha Biswa s AIR 1924 Cal. 380; Ram Rakhan v. Mahant Govind Das AIR 1945 Allahabad 352 and Atul Chandra Das v. Baghbati Das PLD 1967 Dacca 27, to contend that mere withdrawal of the appeals against the two instant decrees could not preclude the appellant- defendant from seeking relief under Order 37, Rule 4, C.P.C. The last two decisions, cited by him, have some relevance, inasmuch as the Allahabad decision opines that dismissal for non- prosecution of an appeal against the decree does not preclude the defendant to seek recall under Order IX, Rule 13, C.P.C. And the Dacca decision lays down that while upon determination of an appeal on merits against the decree, an application for setting aside the same, if ex parte, would lie, even so such application would, in effect, be liable to be dismissed, the matter having already been gone into at the appellate stage. As said earlier, whereas there may be little cavil with the maintainability of the applications under Order 37, Rule 4, C.P.C., it still remained to be shown that "special circumstances" subsisted for recall of the original decrees. None were shown or substantiated.
11. ' Even otherwise, we may here note that, at the time the decrees were passed, the respondent- plaintiff voluntarily gave up 3.5% p.m. So called profit/mark-up and acceded to a 10% return, something which has been found to be, in effect, no interest. That arises in view of the rampant inflation to which the economy has, for long, been subject.
12. ' We have, for the foregoing reasons, found no merit in these appeals and dismiss the same leaving, however, the parties to bear their own costs.