M/S Rafi Cotton Industries Pvt Ltd vs Jbc etc.

Form No: HCJD/C-121

ORDER SHEET

IN THE LAHORE HIGH COURT, MULTAN BENCH

MULTAN

JUDICIAL DEPARTMENT

WP No. 18558 of 2016

M/s. Rafi Cotton Industries (Pvt)Ltd Petitioner Versus

Judge Banking Court etc Respondents

S. No. of order/ Date of order/ Order with signature of Judge, and that of Proceeding Proceeding parties or counsel, where necessary 28.12.2016 Mr. Muhammad Mansoor Alam, Advocate for petitioner.

Through this constitutional petition, the petitioner/company has challenged order dated 08.12.2016 passed by learned Single Judge of this Court in his capacity as Banking Court, Multan whereby the Regional Police Officer, Faisalabad was directed to ensure through his sub-ordinate officials that visit of local commission is properly secured and facilitated his smooth functioning as Commission in the factory premises for the purpose of preparation of an inventory. The petitioner has prayed that the order dated 08.12.2006 be declared as being without lawful authority, illegal, void and ineffective against rights of the petitioner and be set at naught.

2.Brief facts of the case are that Bank Al-Habib Limited, respondent No.2 filed a suit bearing COS No.02 of 2011 under Section

Dated 28.12.2016.

9 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 (“FIO, 2001”) for recovery of Rs.500,857,025.28/- alongwith liquidated damages and costs of fund. The petitioner company filed application for leave to appear and defend the suit bearing PLA No. 04 of 2011. The petitioner company also filed a suit for recovery of Rs.1,142,778,059.00/- as damages, declaration with permanent injunction and for rendition of accounts under Section 9 of the FIO, 2001 against respondent No.2 Bank and manager of Bank Al-Habib Limited, Ghalla Mandi Branch, Vehari Road, Multan/respondent No.3.

3.The respondent bank filed application bearing CM No. 01-C of 2011 under Section 16 of the FIO, 2001 for appointment of local commission to prepare inventory of hypothecated goods, movable and immovable assets as well as pledged stocks lying in the factory premises/godowns. The local commission, Mr. Khalid Masood Ghani, Advocate, submitted his report in the Court which did not include inventory of hypothecated stocks. The respondent/bank feeling dissatisfied with the Commission report filed an application bearing CM No. 621 of 2011 for issuance of a direction to the Commission for noting down specifications of the machinery mentioned in the report and preparation of inventory. The learned Single Judge appointed a fresh local commission comprising of Sayed Anwar Abbas Zaidi and Javaid Saeed Pirzada, Advocates on 19.04.2011 directing them to prepare an inventory after physical inspection of the factory with the assistance of the bank in the presence of other banks and to submit report in the Court. The petitioner filed CM No.1366-C of 2011

Dated 28.12.2016.

showing distrust on the proceedings conducted by the Local Commission and requested for removal of the Advocates comprising the said Commission. The Local Commission filed report No.1 in shape of CM No. 1388-C of 2011 mentioning therein that when they reached the factory premises of the petitioner company alongwith bank representatives, the private security staff of the petitioner company refused to let them enter as permission of the owners/management was not available. Therefore, the Local Commission prayed that petitioner company be directed to desist from creating hurdle in the stocktaking process and requested the Court to provide police assistance to carry out the directions of the Court regarding stocktaking of pledged goods.

4.The respondent bank also filed CM No.1496-C of 2011 stating therein that the petitioner company is creating hurdle in weighing of hypothecated stock by not cooperating with the Local Commission and they be restrained from causing any hindrance and help of police be also provided. These three applications alongwith CM Nos. 2693-C and 2694-C of 2016 came up for hearing before the learned Single Judge on 08.12.2016 when the learned Single Judge relisted CM Nos.

1366 and 1388-C of 2011 for 19.01.2017 and issued notice in CM Nos.

2693 and 2694-C of 2016 for 19.01.2017 whereas in CM No. 1496-C of 2016, following order was passed:

“Through this application, a prayer is made to direct the local police to provide assistance to the local commission appointed on 19.04.2011 to prepare the inventory of Rafi Cotton Industries, Faisalabad.

Mr. Muhammad Javed Saeed Pirzada, Local Commission also agrees to the request made by the bank.

Dated 28.12.2016.

In this view of the matter, Regional Police Officer, Faisalabad is directed to ensure through his sub-ordinate officials that the visit of the local commission is properly secured who will facilitate his smooth functioning as commission in the factory premises for the purpose of preparation of an inventory.

The report shall be submitted before this Court on 19.01.2017.”

5.Through this petition, the order dated 08.12.2016 has been challenged. The counsel for the petitioner argued that learned Advocates appointed as the Local Commission are not aware as to what inventory they have to prepare. The counsel for petitioner company referred to Para 82 of COS 02 of 2011 to state that the bank claims that the assets of the petitioner are hypothecated whereas Local Commission are treating the same as pledged goods in their report. Therefore, the Local Commission cannot properly make the inventory. Further, the learned counsel for the petitioner has argued that his application (CM No.1366-C of 2011) for removal of the Local Commission was pending before the learned Single Judge who has simply relisted the same for 19.01.2017 without taking into consideration the allegations levelled by the petitioner against the Local Commission. He further argued that inventory of hypothecated goods could only be made if the Court had to pass order of attachment for taking over the hypothecated goods and not otherwise.

6.We have heard the learned counsel for the petitioner and gone through the record.

7.The Local Commissions were appointed on 19.04.2011 who fixed 16.07.2011 as a date for visiting the factory premises where they

Dated 28.12.2016.

were refused entry by the guards. The Local Commissions brought this fact to the notice of the Court through CM No. 1388-C of 2011 (Report No.1) dated 20.07.2011. It appears that the petitioner filed CM No.1366-C of 2011 on 21.07.2011 in order to avoid any order being passed on the said report. The petitioner company mainly filed CM No.

1366-C of 2011 on the ground that one of the Commissions belongs to the sect to which the owner of the bank belongs and has close connection with the bank officials whereas the other Local Commission was under the influence of the bank. The CM was filed merely on the basis of apprehension that in these circumstances the Local Commissions could not give a proper report but courts do not pass orders on apprehensions. This aspect of the matter can be determined after the Local Commissions have filed their report against which the petitioner could file objections.

8.Whether the stocks are pledged or hypothecated and objections relating thereto can be taken into account at the time of final disposal of the CMs by learned Single Judge. The question to show distrust upon the Local Commission by the bank can also be taken into consideration by learned Single Judge after the report has been filed. As far as the objection that the inventory can only be made when the Court has to take over the possession or attach the stocks is concerned, the same is baseless and does not have backing of any law as it is discretionary for the Court to get inventory prepared at any time during the pendency of case.

Dated 28.12.2016.

9.Besides the order of providing police assistance to Local Commissions to prepare inventory of the factory premises is interim in nature. No appeal or revision lies against interim orders. We would like to refer to section 22 of the Ordinance, 2001.

Subsection (6) of Section 22 reads as under:-

“(6)--- No appeal, review or revision shall lie against an order accepting or rejecting an application for leave to defend or any interlocutory order of the Banking Court which does not dispose of the entire case before the Banking Court other than an order passed under subsection (11) of section 15 or subsection (7) of section 19.”

The perusal of subsection (6) takes us to the conclusion that where the statute has not provided appeal against an order then the same cannot be challenged by way of constitutional petition as any such allowance would amount to negating the provisions of the statute. We are fortified in our mind by the judgment of the Hon’ble Supreme Court of Pakistan reported as Syed Saghir Ahmad Naqvi v. Province of Sindh through Chief Secretary, S&GAD, Karachi and another (1996 SCMR 1165) wherein the Hon’ble Supreme Court of Pakistan has held that where a statute exclude a right of appeal, the same could not be bypassed by bringing it under attack in constitutional jurisdiction. This view has also been taken into consideration in the judgment reported as Messers Visiontex, Partnership Firm through Partner and 4 others vs. Habib Bank Limited through Branch Manager (2016 CLD 62) and Sheikh Muhammad Usman vs. Learned Judge Banking Court No.1 and another

(2015 CLD 257).

Dated 28.12.2016.

10.In view of what has been stated above, we see no merit in this writ petition. No illegality or excess of jurisdiction has been pointed out. We do not find the impugned order perverse or arbitrary.

Therefore, this writ petition being devoid of any merits is dismissed in limine.

Amin-ud-Din Khan Muzamil Akhtar Shabir Judge Judge Naveed*