Find a Lawyer

Civil Petition No. 2 of 1984, decided on 7th February, 1984.

(From the order dated 11‑12‑1983 of the Lahore High Court, Bahawalpur Bench, passed in R.F.A. No.78/83‑BWP.).

‑‑‑Art. 185(3)‑‑Banking Companies (Recovery of Loans) Ordinance (XIX of 1979), S.7‑‑Suit for recovery of amount upon loan advanced to petitioner‑‑Grant of leave to defend‑‑Imposition of condition that petitioner deposits entire suit amount before next date of hearing‑‑Held, within discretion of trial Court‑‑No illegality found in exercise of such discretion and no case made out for interference‑‑Leave to appeal refused.

Sh. Masud Akhtar, Advocate‑on‑Recor for the Petitioner.

M. A. Farani, Advocate Supreme Court with M. A. Qureshi, Advocate‑on‑Record for Respondent.

Date of hearing: 7th February, 1984.

This petition arises from a suit brought by the respondent i.e. the United Bank Limited, under the Banking Companies (Recovery of Loans) Ordinance (XIX of 1979), against the petitioner for recovery of Rs . 2 , 51,125 based upon a loan of Rs .1, 50 , 000 advanced to the petitioner by two cheques in the sum of Rs.75,000 each, encashed on 13‑2‑1980. The petitioner had also executed two mortgage deeds for Rs.75, 000 each by way of security for the loan. However, he brought a declaratory suit against the Bank on 20‑12‑1982 challenging the validity of the mortgage deeds on the ground that they were without consideration. It is said that a stay order had also issued in his favour in that suit. In the present suit instituted by the Bank on 21‑5‑1983 the learned Special Judge, holding that no other Court had jurisdiction in the matter, proceeded with it and on an application of the petitioner granted him leave to defend the suit conditionally upon his depositing the entire suit amount before the next date of hearing. Against this order the petitioner moved a writ petition but the same was dismissed on 24‑9‑1983. As he had failed to deposit the suit amount, the suit was decreed on 25‑9‑1983. His Regular First Appeal having been dismissed in limine on 11‑12‑1983, he has moved this Court for grant of leave to appeal.

2. Learned counsel has urged that as the trial Court had found that the petitioner had an arguable case inasmuch as he had denied to have received the proceeds of the cheques, leave to defend the suit ought to have been granted to him unconditionally or upon such condition as would be appropriate in the circumstance but that calling upon him to deposit the entire amount claimed, virtually meant a denial of opportunity to defend the suit.

3. Mr. M. A.Farani, appearing for the Bank, pointed out that the petitioner had, in fact, not executed mortgage deeds but only agreements to mortgage and that in any case, he was denying the validity of the said deeds. He further pointed out that the suit had been filed not on the basis of the mortgage but of the loan. According to him, the loan had been advanced on the application of the petitioner and he had drawn the amount by two cheques as aforesaid.

4. It has not been denied by the petitioner that he had issued the cheques concerning the loan in question. The High Court has noted that the cheques had been encashed and that he had even acknowledged his liability to pay, on account of the loan Rs.2,10,036 as due on 31‑12‑1981 and Rs.2,29,801 as due on 30‑6‑1982. The grant of leave without a condition in the circumstance would hardly he justified. The imposition of condition is within the discretion of the trial Court and in the circumstance of the case we find no illegality in the exercise of that discretion. No case is made out for interference. The petition is accordingly dismissed.

S. Q. Petition dismissed.

Find a Lawyer Near You

Dealing with a matter like this? Connect with a verified advocate in your city — free on SJP Lawyers Directory.