MUHAMMAD SAIR ALI, J.---Through this Regular First Appeal appellants have challenged judgment and decree dated 31-10-2000 passed by learned Judge Banking Court-II, Faisalabad whereby Habib Bank's suit for recovery was decreed to the extent of Rs,44,51,931 with costs and future mark- up. By orders dated 21-12-2000 and 31-1-2001, record was requisitioned which was received and examined.
2. Learned counsel for the respondent also appeared on 31-1-2001 and filed his power of attorney wherefor, no notice was required to be given to the respondent. Since the case was thoroughly argued by the learned counsel for the parties, the same was treated as an admitted case and is being decided accordingly. Habib Bank Limited (respondent) filed a suit for recovery of Rs,53,28,295 against the appellants. It was claimed that appellant No,1 i,e, the Company through acceptance of facility letter dated 1-1-1994 and execution of General Financing and collateral agreement dated 1- 1-1994, obtained guarantee facility and through acceptance of sanction letter dated 29-12-1993 and execution of an agreement for financing dated 1-1-1994 also obtained facility of Export Re- financing (Part-II) to the extent of Rs,7 millions. The said facility was secured through execution of a promissory note, hypothecation agreement, personal guarantees of appellants Nos.2, 3 and 4, creation of mortgage, acknowledgement of deposit of title deeds and other documents made in favour of the respondent-Bank by the appellants. And that as a result of encashment of said guarantee and enjoyment of export re-finance facility, appellants became obligated to pay Rs,53,28,295 as shown in the Statement of Accounts.
3. On 12-6-2000, appellants filed their application for leave to defend the suit alleging that the suit was time-barred as admittedly the financing facility expired on 31-12-1994 while the suit was filed on 2-6-2000. Wherefor, a separate application under Order VII, Rule 11, C.P.C. Was also filed. It was also alleged that Bank was not competent to charge mark-up beyond the period of 31-12-1994 while an exhorbitant amount of markup has been charged by the Bank as shown in the statement of account running beyond 31-12-1994. Further that the respondent failed to place on record the Financing Agreement. And other documents filed and relied upon by the respondent-Bank were illegal, void, improperly stamped and without any legal veracity. It was further alleged that the statement of Account as filed by the respondent-Bank with the suit was defective, unreliable and did not relate to the period of finance and the same was inadmissible in evidence. Wherefor, the respondent-Bank cannot claim the . Alleged suit amount of Rs,53,28,295.
4. The learned Judge Banking Tribunal-II, Faisalabad rejected appellants' application for leave to defend the suit by holding that:-- "I have heard the learned counsel for the parties and also perused the documents placed on file.
The version of the defendants is misconceived and do not attract the averments of the case in hand. In support of suit claim, the plaintiff has placed on record a copy of statement of account alongwith certain documents including agreement for financing on mark-up basis etc. Since these documents are authentic, trusted and otherwise confidence-inspiring and it is clear violation of the terms and conditions of the agreement on the part of the defendants in making payment of dues of the Bank. The applications are without any substance as there has no serious and bona fide dispute raised therein. Learned counsel for the defendants could not convince me on the objection of time-barred and on the other hand availing of the finance facility is not controverted at the agreed rate of mark-up and there is no triable issue involved in the applications of the defendants, thus, the applications stand dismissed."
As a result of the above, the learned Judge Banking Court, excluding the liquidated damages and mark-up for the cushion period of 210 days, decreed the suit of the Bank with costs and mark-up.
5. Learned counsel for the appellants supported the pleas taken in their leave application as reproduced hereinabove while the learned counsel for the respondent-Bank contended that the appellants' leave petition was rejected legally and the decree was passed in terms of record.
6. We have examined the record and attended to the contentions of the parties. The examination of the case file reveals that:--
(i) Statement of Accounts was filed twice by the respondent-Bank:
(a) The first statement relates to the period of July, 1995 to 16-11-1999 for Export Re-finance Part-II, showing the balance of Rs,29,54,126 as on 16-11-1999. Statement of Account for mark-up upon Export Re-Finance Facility contains only one entry i,e, `mark-up recoverable up to 16-11-1999' and shows a figure of Rs,14,97,805.
(b) The second Statement of Account consists of three pages.
One page (page 45 of the suit file) repeats the Export Re- finance Part-II statement w,e,f, 1-1-1998 to 16-11-1999 showing a balance of Rs,29,54,126.
The second page (page 47 of suit file) is the statement of mark-up as of 1-9-1998 showing the claim of following mark-up:-- 1-9- 1998Remaining mark-up (1-9-1998 to 31- 12-1998)322231.00 Mark-up 1-1-1999 to 2-8-1999 964932.00 Mark-up 3-8-1999 to 3-8-1999 967552.00 Mark-up 4-8-1999 to 4-8-1999 969793.00 Mark-up 5-8-1999 to 13-11-1999 1133677.00 Mark-up 14-11-1999 to 15-11-1999 1133677.00 Mark-up 16-11-1999 to 31-12-1999 1227369.00 Mark-up 1-1-2000 to 28-5-2000 1497805.00 Page 3 (page 43 of the suit file) shows the total claim of the respondent-Bank against the appellants as Rs,53,28,295.00 as per the following break-up:-- 9-5- 2000Remaining principal 2954126.00 9-5- 2000Remaining Mark-up 4451931.00 Liquidated damages @ 20%5042756.00 Cushion period Mark-up 210 days5328295.00 -- Agreement of finance dated 1-1-1994 (I.B.6 at page 93 of the suit file) shows expiry date to be the same as per sanction letter which mentions date of expiry as 31-12-1994. -- Promissory Note (at page 101 of the suit file) is also dated 1-1-1994. -- Personal Guarantees (at pages 59 to 63) are also dated 1-1-1994. -- Memorandum of deposit of title deed is also dated 1-1-1994 (at page 65 of the suit file).
7. The learned Judge Banking Court does not appear to have applied his mind to the above documents relied upon and filed by the respondent-Bank in support of its case. A bare reading of the impugned judgment shows that none of the grounds raised by the appellants in their leave application was considered. The case seems to have been decided by giving bland, general, vague and unsubstantiated observations which do not find support from any of the above-stated documents. The learned Judge Banking Court has not at all attended to or dilated upon any of the following facts involved in the case:--
(a) There is not a single document on record showing extension of facilities of export re-financing or the guarantee facility beyond the period of 31-12-1994. All the documents except Statement of Accounts bear the date of 1-1-1994.
(b) If the finance facility was extended on 1-1-1994 and the documents were also executed on 1-1- 1994 to secure facility which expired on 31-12-1994, was the suit within the period of limitation.
(c) The Statement of Accounts above-referred start from July, 1995 and not from 1-1-1994 i,e, the period of commencement of finance facility. The ERF statement shows debit and credit entries till 16-11-1999. Do these entries prove operation by the appellants and effect to extend the period of limitation.
(d) Mark-up has been charged by the respondent-Bank for unspecified period at unspecified rate beyond the period of 31-12-1994. Was the Bank authorized and competent to charge such mark-up, if the finance facility expired on 31-12-1994; and
(e) Whether the Bank had the authority and contractual right to charge and recover mark-up at an unspecified rate like interest and mark-up upon markup.
8. The impugned judgment and decree does not show that the above questions directly involved in the case were taken into account by the learned Banking Tribunal and the learned Judge was even conscious of any of the issues. Wherefor, accepting the appeal the impugned judgment and decree is set aside. The case is remanded to the learned Judge Banking Court, Faisalabad for re- decision in accordance with law and after attending to the facts/question recorded above. The suit of the respondent-Bank and petition for leave to defend the suit filed by the appellants shall be deemed to be pending before the learned Judge Banking Court, Faisalabad. The parties are directed to appear before the learned Judge Banking Court-II, Faisalabad on 29-10-2001. There shall, however, be no order as to costs.