1. Dismissed as not pressed.
2. I have heard the learned amicus curiae in relation to the question if proceedings seeking decree for foreclosure under Order XXXIV, C.P.C. And be treated as short cause proceedings in view of the dictum laid down in the case of Industrial Development Bank of Pakistan v. M/s. Nadeem Flour Mills and others 1981 SCM R 143. Mr. Chundrigar at the very outset has referred to judgment in M/s. Conforce Limited v. M/s. Rafique Industries Ltd. And others PLD 1989 SC 136. The cited case had arisen from final decree passed by Special Judge Banking, Lahore in proceedings instituted under the Banking Companies (Recovery of Loans) Ordinance, 1979 (hereinafter referred to as ' the 1979- Ordinance). The multifacet prayer made in such proceedings included preliminary mortgage decree and objection was taken about competence of the Special Judge Banking in proceeding against the property of defendant-company. Question had arisen in appeal before the Division Bench of the High Court that the bank having obtained decree for payment of money on a claim arising under mortgage, no Personal decree could be passed until the mortgage security was exhausted through a Court Sale pursuant to the final decree. Reference was made to the provisions contained in subsection (2) of section 7 of the 1979 Ordinance. The Hon'ble Judges of the Supreme Court while interpreting the said provision with reference to Order XXXIV and Order XXXVII, C.P.C.
Came to the following conclusion:-- "But reverting to the facts of the present case it may be pointed out at the outset, that the decision of the Division Bench of the High Court proceeds on the assumption that the suit instituted by the plaintiff-bank was a suit on mortgage, governed entirely by procedure provided in Order XXXIV, C.P.C. This to our mind appears not entirely JO be correct and may amount to an over simplification of a complicated situation. As pointed out in H.T.M. Limited v. Allied Bank of Pakistan (PLD 1987 SC 512), having regard to the various provisions of the Ordinance, the special Court is required to follow the procedure laid down in the C.P.C. While trying a suit and particularly the summary procedure provided for in Order XXXVII. The only rider to this proposition is where any deviation is provided for in the Ordinance from the ordinary procedure laid down by the C.P.C. In which case the provisions of the Ordinance in that respect will take over. The special procedure provided in Order XXXVII, C.P.C. Was designed to apply in respect of suits on negotiable instruments, therefore, under the C.P.C. a suit on mortgage was not governed by the special procedure provided for in Order XXXVII. On the other hand suits relating to mortgages of immovable property were regulated, in the matter of procedure for trial, by the provisions of Order XXXIV, C.P.C. The provisions of this Order provided for the frame of a suit relating to mortgages, as well as for decrees, preliminary and final to be passed in such suits and generally for the substantive rights of the mortgagee, and mortgagor. The rules of procedure contained in the Order correspond to the provisions relating to mortgages in the Transfer of the Property Act, 1882.
Whether the last-mentioned Act has been extended to Islamabad or not is a question not raised or discussed during the arguments. However the Ordinance under which the suit was filed seems to contemplate institution of suits in the special Court by a banking company or borrowers which may be based on negotiable instruments, statements of account, personal undertaking to repay loans extended by such banking company, or on mortgages of all kinds. This is clear from subsection (2) of section 7 of the Ordinance." (Emphasis supplied).
' According to Mr. Chundrigar the position stands amply clarified by the above judgment, and therefore, in a suit seeking final decree for sale of the mortgaged property along with other prayers, like the present suit, the entire proceedings has to be tried as short cause matter. The learned counsel has referred to provisions contained in section 9(4), 10, 14 and 16(1) of the Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997 (hereinafter referred as Act XV of 1997). The learned counsel contends that despite deletion of words "including suit based on mortgages of all kinds" used in section 7(2) of the 1979 Ordinance, the position in relation to mortgage suits remains unchanged under Act XV of 1997. For proper appreciation of the contention raised by Mr.Chundrigar, it is advantageous to reproduce the above-referred provisions which are as follows:-- 1979 Ordinance: "S.7. Procedure of Special Court.--(1)...
(2) In the exercise of its civil jurisdiction, the Special Court shall in all suits before it, including suits based on mortgages of all kinds of statement of accounts for recovery of money paid to. Or to the order of, the defendant, follow the summary procedure provided for in Order XXXVII in the First Schedule to the Code of Civil Procedure, 1908 (Act V of 1908).
' Act XV of 1997:
10. Leave to defend.--Subject to section 11, the Banking Court shall, upon an application made by a defendant within twenty-one days, give leave to defend the suit, if a serious and bona fide dispute is raised thereby: ' Provided that where service has been validly effected only through publication in the newspapers the Banking Court may extend the time for filing an application for leave to defend if satisfied that the defendant did not have knowledge thereof.
14. Decree in suits relating to mortgages.--Where the claim filed by a Banking Company before the Banking Court is for the enforcement of a mortgage of immovable property the Court will not be required to pass a preliminary decree as provided in Order XXXIV of the First Schedule to the Code of Civil Procedure, 1908 (Act V of 1908), but shall directly pass a final decree for foreclosure or sale.
16. Attachment before judgment and appointment of receivers.--(1) Where the plaint under subsection (1) of section 9 is for recovery of any amount through the sale of any property pledged, mortgaged, hypothecated, assigned or otherwise charged as security for the loan or finance, or for or in relation to a finance lease, the Banking Court may, at any stage of the proceedings--
(a) restraint or in junco the sale, creation or charge or lease or disposal or disposition of such property by the borrower or customer; or
(b) attach such property; or
(c) appoint one or more receivers of such terms and conditions as it may deem fit."
' It is urged by Mr.Chundrigar that the reference to suits based on mortgage in the said provisions and particularly sections 14 and 16(1) clearly implies that a single suit joining several causes of action can be filed against a customer as defined in section 2(d) of the Act XV of 1997. Explaining the judgment in IDBP v. M/s. Nadeem Flour Mills (supra), it is pointed out that the question involved in such proceedings was if proceeding under section 39 of the IDBP Ordinance, 1961 could be continued in High Court after promulgation of the 1979-Ordinance and the observation referred by Mr.Shahani was merely an obiter which in any event, stood modified by the latter judgment passed by a larger Bench of the Hon'ble Supreme Court. It is further pointed out that the said observations were made in relation to proceedings before Special Court whereas, the cases filed in this Court on its original side are regulated by the Sindh Chief Court Rules (O.S.) wherein Rule 22 provides for treating a mortgage suit as short-cause matter. The arguments of Mr.Chundrigar are quite A persuasive and I find myself in agreement with him. The ratio of judgment in M/s. Conforce Ltd. (supra) clearly lays down the rule that mortgage suit can be joined with suit for recovery of money. The provisions of sector 14 of Aet XV of 1997 do evidently enable the Court, hearing cases in exercise of jurisdiction under the said Act, to pass final decree for sale of mortgaged properties. Again, a final decree for sale of mortgaged property can be passed only in proceedings based on mortgage. Thus, exclusion of mortgage suits from the purview of banking Court would render the provisions of sections 14 and 16 of the Act .XV of 1997 infructuous and it is a trite observation that redundancy cannot be attributed to a statute and each and every word therein carries a meaning. Mr.Shahani, appearing for the defendant No,1, has tried to distinguish the judgment in M/s. Conformed Ltd. (supra) by saying that the earlier judgment cited by him was not considered therein. I am afraid, such can hardly be a reason to discard judgment delivered later by a larger Bench.
The contention of Mr.Shahani that section 14 of Act XV of 1997 has curtailed the powers of a Banking Court by restraining it from passing a Preliminary Decree in mortgage suits is rather a misdescription of the situation. The above provision, indeed enables the Banking Court to pass Final Decree for sale in a mortgage suit, thus, by-passing the impediments prescribed under Order XXXIV, C.P.C.
Mr.Shahani has contended next that omission to use the words referred in the case of Conforce.
Ltd. (supra) which had appeared in section 7(2) of the 1979-Ordinance was conscious and the Court being incompetent to supply omissions in the statute, jurisdiction of Banking Court did not encompass a suit based on mortgage. Such contention manifestly, loses sight of the provisions contained in sections 14 and 16 of Act XV of 1997. As observed earlier, the suits for sale of mortgaged property can always be agitated before the Banking Court and a contrary view is not possible without causing violence to the above-referred provisions of current law regulating recovery of loans, advances, credits, and finances by or against banking companies.
'Having found that mortgage suits can validly be entertained by this Court in its banking jurisdiction, the question agitated about the procedure for trial may now be taken up. Mr.Shahani has urged that a mortgage suit is ordinarily to be tried as a long-cause matter. Such contention, however, is without force for more than one reason. Firstly, the procedure for trial of case in this Court on its original side is provided under the Sindh Chief Court Rules (O.S.) which under Rule 22 prescribes the categories of cases to be treated as short-cause. Under clause (5) of Rule 22 (ibid) mortgage suits are required to be tried as short-cause. Moreover, in every matter falling within Act XV of 1997 and brought to Court, application for leave to defend has to be filed under section 10 thereof. The question for trial as long cause or short cause arises only after grant of leave, if so made out. The defendant No,1 alone has filed application in the present case for leave to defend as above which can be granted if serious and bona fide dispute is raised thereby. The learned counsel for the defendant No,1 has chosen to urge the two points only as are recorded in the order dated 19-2-1998 and are reproduced hereunder:- "1. The present proceedings being one for decree under Order 34, C.P.C. Cannot be treated as short- cause proceedings in view of dictum laid in the case of Industrial Development Bank of Pakistan v.
M/s. Nadeem Flour Mills and others (1981 SCM R 143).
2. The original money claim for Rs,5,25,17,368.77 having subsequently been reduced through filing revised statement of account was referred doubtful, and therefore, the defendant No,1 was entitled to grant of leave."
' The consequence of dismissal of leave application is clearly provided in section 9(4) of Act XV of 1997. The special law having itself prescribed the procedure, has to be applied and followed as provided by section 7(2) of the said Act.
' The upshot of the foregoing is that the objection raised by Mr.Shahani as at (1) above, is repelled.
Reverting to the second point urged by Mr.Shahani, suffice to observe that revised statement of account was filed by the plaintiff pursuant to direction by the Court. Compliance with the direction of Court can in no way operate to prejudice the claim of a party; nor can it lead to a finding that any plea has been abandoned. A statement of account is filed on the basis of entries regularly maintained in the books of the bank and are entitled to be believed unless shown otherwise. The second objection urged by Mr.Shahani, therefore, is rejected. The defendant No,1 has failed to make even a bald assertion disputing correctness of the statements. Indeed, the remaining defendants have failed to file any application for leave under section 10 of Act XV of 1997. Quite strangely, the defendant No,2 who has sworn affidavit in support of the application made on behalf of defendant No,1 and signed Vakalatnama, has chosen not to attempt defending the proceedings attracting the consequences prescribed under section 9(4) of Act XV of 1997. To some extent, the two sides appear to have acted hands in glove. The defendant No,1 had initially engaged Mr.Shahid Ali Naqvi, Advocate who uses the same chamber as is used by the plaintiff s counsel.
' Mr. Muhammad Sadiq, who has appeared for the plaintiff has adopted the stand taken by Mr.Chundrigar and has urged that no serious and bona fide dispute has been raised by the defendant No,1.
' Since no other contention was raised at hearing, the application, Civil Miscellaneous Applications No,8874 of 1997, is dismissed.
Resultantly, the contents of the plaint are 4o be deemed to have been admitted and the plaintiff is entitled to decree as prayed therein. The plaint and the documents annexed therewith were examined by me on 9-2-1998 with the assistance of Mr.Nafees A. Siddiqui, Advocate who was unable to explain various entries in the statement of Account and had sought time to file revised statements of account. The next day, the revised statements of account were filed which too were found to contain entries contrary to the terms, contained in the Sanction Advice. Consequently, at the request of the learned counsel for the plaintiff, hearing was further deferred to 12-2-1998 when II Revised Statements of Account were filed. Copies of the statements were supplied to Mr.Akhtar Hussain, who had appeared on that date on behalf of defendant No,1 . No objections have been filed disputing the entries contained in the statements of account.
' The first among the II Revised Statements pertains to Running Finance Account showing the outstanding balance as Rs,33,235,148.77. Mr.Nafees Siddiqui, through endorsement made in hand, has conceded that a sum of Rs,26,74,474 be deducted from the said balance. On the date of Sanction, Advice i,e, 28-12-1995, the balance in R.I.F. Account is shown as Rs,12,202,684.77; two days later, Rs,1,28,90,999 have been debited due to adjustment of Demand Finance Account; on 31-12- 1995, Rs,5,96,877 is debited towards mark-up for which no agreement is shown; likewise on 11-5- 1996, a sum of Rs,1,03,238 has been debited as the amount short-recovered from July, 1994 to June, 1995 which cannot be allowed being duplicate entry; mark-up for 1-1-1996 to 31-12-1996 is calculated at Rs,40,00,000 without disclosing the rate; the Demand Finance figure stated above is detailed in a separate statement but it includes Rs,1,912,763 as mark-up for the period from 10-4- 1995 to 31-12-1995 and for the same period mark-up is already included in the R.I.F. Account. The above amounts are to be adjusted from the claim amount mentioned in the statement.
' The next statement pertains to F.I.M. Account showing outstanding balance as Rs,18,220,519. The plaintiff's counsel has filed a letter received by him from the bank to the effect that a sum of Rs,5.10 million was received from defendant No,1 during pendency of this case reducing the outstanding balance to Rs,13,120,519. The expiry date agreed for F.I.M. Facility was 30-6-1996, and therefore, the last three entries of mark-up amount for the period from 1-7-1996 to 31-12-1996 cannot be allowed.
' Let revised statement of account worked on the above basis, be filed within two days from today with advance copy to the other side. Put up on 9-3-1998.