Zohaib Model Industries (Pvt) Ldt vs Summit Bank Ltd

Stereo H.C.J.D.A.38

JUDGMENT SHEET

IN THE LAHORE HIGH COURT, MULTAN BENCH,

MULTAN.

JUDICIAL DEPARTMENT

RFA No. 123 of 2018 Zohaib Model Industries (Pvt) Limited & 2 others appellants versus Summit Bank Limited Respondent

JUDGMENT

Date of hearing 14.11.2019

Appellants by Mr. Muhammad Aslam Siddiqui, Advocate. Respondent/bank by Malik Sajjad Haider Maitla, Advocate.

MUZAMIL AKHTAR SHABIR, J.- Through this Regular First Appeal, filed under Section 22 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 (“Ordinance”), the appellants have called in question the judgment and decree dated 11.12.2017 passed by Banking Court-III, Multan, whereby suit for recovery of Rs.57,632,149.42 filed by the respondent bank was decreed jointly and severally against the appellants to the extent of Rs.43,138,583.14 with costs and cost of funds from date of default till its realization.

2.Learned counsel for the appellants has argued that the grounds raised by the appellants have not been properly addressed by the Banking Court, therefore, the impugned judgment and decree is not

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sustainable in the eye of law having failed to determine the real controversy in issue.

3.On the other hand, learned counsel appearing on behalf of the respondent/bank has supported the impugned judgment and decree by stating that the same has validly been passed against the appellants.

4.Heard. Record perused.

5.The respondent bank filed a suit for recovery of Rs.57,632,149.42 against the appellants which was contested by the appellants on various legal and factual grounds, however, the same was decreed against them by dismissing their application for leave to defend. It is contended by the appellants that although initially the running finance facility was availed by them vide agreement dated 28.06.2008 for one year which was renewed in the year 2009 for another year and the appellants did not get it renewed thereafter, therefore, the expiry dated was 30.06.2010 whereas the respondent bank has continued to charge the markup till 27.06.2011 which is beyond the expiry period and consequently not sustainable. Besides, no transaction was made by the appellants in the account beyond 30.06.2010 and the entries thereafter in the statements of account are without any legal justification.

6.It is observed that availing of finance facility is admitted between the parties which is also supported by finance documents executed by the appellants in favour of the respondent bank which are available on the record. The only grievance of the appellants is that the agreement of finance was renewable on year to year basis and after

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initial agreement executed in the year 2008 and the same was only renewed once for the year 2009 with expiry date of 30.06.2010 and no further renewal or transaction was made in the accounts, therefore, claim of the respondent relating to period beyond 30.06.2010 is not sustainable. This assertion is negated by the learned counsel for the respondent bank by referring to finance agreement and statements of account. Clause 4 of the agreement of finance dated 28.06.2008 shows expiry date as 27.06.2011 which means that finance was availed for a period of three years and not for a period of one year as claimed by the appellants. Even the appellants have made various transactions in the running finance account through debit and credit entries which are reflected in the statements of account supported by details of the same.

The appellants have failed to point out any entry in the statements of account that is incorrect or not supported by any document. It is not the claim of the appellants that any amount deposited by them is not reflected in the statements of account. The entries in statements of account clearly show that the appellants have been availing the said facility for about three years and markup has been charged up till 15.06.2011, a few days prior to the expiry date i.e. 27.06.2011.

Consequently the claim of the appellants that the agreement was for one year renewable on year to year basis and was not get renewed with effect from the year 2010 is not supported by documents available on the record and therefore the said argument is declined. Besides the application for leave to defend filed by the appellants failed to raise and substantial question of law or fact requiring grant of leave to

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defend, therefore, the same was rightly dismissed by the Banking Court. The Banking Court after taking into consideration the principal and markup accounts up to expiry date i.e. 27.06.2011 wherein markup has been charged till 15.06.2011 and deducting the markup charged thereafter has rightly decreed the suit and appellants have failed to point of any discrepancy in the said judgment, consequently there is no ground to interfere in the judgment and decree passed by the Banking Court which is upheld.

7.For what has been discussed above, this appeal being devoid of merit is dismissed.

(Abid Aziz Sheikh) (Muzamil Akhtar Shabir) Judge Judge

Naveed *