' MIAN SAQIB NISAR, J.---This judgment shall decide the present appeal and R.F.A. No,712 of 2001 as both these appeals arise out of the same judgment and decree of the Banking Court qua the present set of appellants.
2. Briefly the facts of the case are that vide sanctioned letter dated 6th of May, 1993, respondent No,1 allowed to grant two loan/financial facilities to respondent No,2, i.e. L.M.M. Facility worth Rs.6.275 million and loan facility worth Rs.13.725 million, totalling Rs.20 million. The appellant and other respondents are either guarantors or the mortgagor for the security of the said facilities, whereas in Appeal No,712 of 2001 Mr. Habib ur Rehman is the Chief Executive of respondent's company. Be that as it may, respondent No,2 abandoned its project for which the facilities were required and accordingly intimated the Bank about its intention vide letter dated the 27th of October, 1994.
However, by that time on asking of the borrower company, the Bank had already made payment of certain amount to the supplier of the machinery, which under the LMM loan the company had required, therefore, in the aforementioned letter it was specifically undertook and promised by the company that such amount paid to the supplier, shall be adjusted towards the liability of the company. Subsequently, the company failed to discharge its liability, resultantly respondent-Bank brought the suit for recovery of Rs.25,54,647, inter alia against all the appellants in which leave application was filed, but these have been rejected and the suit is decreed to the extent of Rs.17,21,408.
3. Learned counsel for the appellant contends that the Banking Court had no jurisdiction, because in the loan agreement, which was admittedly executed between the parties, it is clearly stipulated that in case of any dispute between them, the litigation shall be instituted in the Banking Court at Islamabad. It has been further argued by Mr. Jawahar A. Naqvi, learned counsel for one of appellants in one of the appeals that though some amount has been paid by the Bank to the Supplier for machinery, but the machinery had not been supplied, to the company, therefore, in such eventuality the B supplier was a necessary party, and as the Bank did not array him as the defendant, the suit was bad for the non-joinder of the parties. On account of both the above submissions, it is argued that substantial questions of law and facts were raised, for which leave should have been to be granted to the appellants.
4. We are afraid that the above contentions of the appellant have any force. As regards the payment of amount to the supplier is concerned, in the letter dated 27th of October, 1994, which is admitted between the parties, in very clear and unequivocal terms the liability has been acknowledged by the Company, with the promise to repay the amount. Obviously, the amount has not been repaid; therefore, on account of lapse of borrower-Company, the Court below has rightly passed the decree against all the defendants who are the guarantors or the mortgagors for the repayment of the facility and were jointly and severally liable in this regard.
5. The argument of Mr. Jawahar A. Naqvi that the ground about the non-supply of the machinery and the consequences thereof was set out in the leave application, but this plea had not been decided by the learned Court below. Suffice it to say that the reference made to paragraphs Nos.3 and 4 of the leave application in this behalf of Mr. Naqvi, does not in any manner envisage that the plea was at all taken. This plea is only for the joining of the supplier as the party to the case, who otherwise, is not a necessary party and also could not be impleaded as the party in view of the special nature of jurisdiction of the special Court in relation to special persons mentioned in the law. Resultantly, the objection has no force and has rightly been discarded by the learned Banking Court.
6. So far as the argument of Mr. Khalid Sajjad, Advocate for appellant Agha Sami Ullah Khan, that the Banking Court at Lahore had no jurisdiction to entertain the matter, it may be held that as per the record, at the time of the institution of the suit, no Banking Court was constituted or functioning at Islamabad, and according to section 20 of C.P.C., which is applicable to the proceedings, the suit could be validly instituted where anyone or more of the defendants were actually and voluntarily residing or carrying the business etc. Admittedly, some of the defendants of the case resided at Lahore and the, mortgaged property is also situated here; thus, the suit was rightly instituted at Lahore. This appeal has no merit and is dismissed. No order as to costs.