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2003 CLD 722

A. RASHID M. HANIF and 5 others vs Messrs FAISAL BANK LTD. through

Citation2003 CLD 722
CourtLahore High Court
Judge(s)Muhammad Sair Ali, Nasim Sikandar
ResultAppeal allowed

' NASIM SIKANDAR, J.---Respondent No,1-M/s. Faisal Bank Ltd. Brought a suit for recovery of certain amount against nine defendants in all. The first defendant was a public limited company while defendants Nos,2 and 3 were arrayed as being not only the directors but also the guarantors of the loan taken from the petitioner-Bank.

2. Rest of the respondents Nos,4 to 9, now appellants namely A. Rashid, M. Hanif; Riaz Masood, Shaukat Shafi, Khalid Bashir, Amir Hussain Zaidi and Khurram Mazhar Karim are arrayed as defendants only for the reason that at the relevant time when the loan facility was availed, they were also the directors of the borrower company defendant No,1. It appears that the present appellants, defendants Nos,3 to 9 before the learned Judge Banking Court, were allowed to defend the appeal in the first instance. They had pleaded that they were neither the principal debtors nor guarantoRs, However, subsequently the Judge, Banking Court through the impugned judgment and decree dated 25-4-2002 decreed the suit of the plaintiff to the extent of Rs,1,61,01,122.61 alongwith costs against all the defendants including the present appellants.

3. Before us the appellants complain that their inclusion in the list of defendants in the plaint before the Judge Banking Court was unjustified for the simple reason that they were neither the borrowers nor guarantors and, therefore, were not covered by the term "customer" as defined in law.

4. We have heard the parties. During hearing we have put a specific question to the learned counsel for the respondent-Bank if anyone of the present appellants were either borrowers or were guarantors in any form. He states that they were arrayed as defendants for the reason of their being shareholders of the principal borrower, the defendant No,

1. Learned counsel is of the view that the shares held by the appellants must have been pledged as a security and that could be the reason for their making defendants in the suit. At this, learned counsel for the appellants points out that in their reply before the Judge Banking Court, the plaintiff borrower-Bank never made any such assertion. From the contents of the reply made by the plaintiff to their petition for leave to defend he explains that the Bank rather admitted that defendants Nos,4 to 9 (now appellants) were not guarantors of the loan.

5. On going through the said reply of the respondent-Bank as also the contents of its plaint before the Banking Court which makes mention of the appellants only as director shareholders, we will allow the argument, that the appellants were neither a proper nor a necessary party to the proceedings before the Banking Court. Therefore, this appeal is allowed and the impugned judgment and decree of the learned Judge Banking Court is set aside to their extent.

Cited by 1 case

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