IN THE HIGH COURT OF SINDH CIRCUIT COURT HYDERABAD
Ist. Appeal No.D- 44 of 2013
Present:
Mr. Justice Aziz-ur-Rehman.
Mr. Justice Muhammad Saleem Jessar.
Appellants: M/s CIE Computers through its proprietor Aqeel Hassan Khan & 02 others.
Respondent: NIB Bank Limited Banking Company through its Manager Mr. Sajid A. Shaikh
Date of hearing: 24.09.2018.
Date of judgment: 11.10.2018.
Mr. Muhammad Asif Arain, Advocate for Appellants.
Mr. Altaf Ahmed Shahid Abro, Advocate for Respondent.
JUDGMENT
AZIZ-UR-REHMAN, J: The Appellants-Defendants feeling `aggrieved` and `dis-satisfied` with the impugned `judgment` and `decree` both dated 12.06.2013, passed in favour of Respondent Bank-plaintiff Bank, by Banking Court No.I, Hyderabad, in Suit No.129 of 2011 [NIB Bank Limited v/s M/S CIE Computers & 2 others], have approached this court by way of filing the instant Ist Appeal with the following prayer[s]:-
i. Set aside the Impugned judgment and decree dated 12.06.2013 passed in Suit No.129/2011.
ii. Call on Record of proceeding of Suit No.129/2011. Grant cost of proceedings to the Appellants.
iii. Grant such other further/better releief/s as this Honable Court may deem fit and proper in the interest of justice.
2. The precise relevant facts leading to the filing of the aforesaid Ist Appeal are as follows:-
3. The Respondent i.e. NIB Bank Limited., is a Banking Company incorporated under the Laws of Pakistan, having its` Registered Office at Muhammadi House I.I. Chundrigar Road, Karachi, and having a Place of business/branch at Saddar Hyderabad, as such, falls within the meaning of Section 2(a) of the Financial Institutions [Recovery of Finances] Ordinance, 2001 [In short FIO, 2001].
4. The Appellate No.1-Defendant No.1 viz. M/s CIE Computers is running its` business at Shop No.MB-08, Mezzanine Floor, Tayab Complex, Cantt: Area, Hyderabad, through its` proprietor Aqeel Hassan Khan availed Financial Facility[ies] from time to time from Respondent Bank. The Appellant-Defendant No.1 besides, being a sole proprietor of Appellant No.1, is a guarantor. The Appellant No.3, is a mortgagor in respect of the financial facility[ies] granted to and availed by Appellant No1, thus they are `Customers` within the meaning of Section 2(c) of the Financial Institution [Recovery of Finance] Ordinance, 2001.
5. The Finance Facility granted to and availed by Appellant No.1, as per record, was renewed in the year, 2009, at its` request but, indeed, after execution of various documents duly `signed` and `executed` by the Appellants i.e. Sanction Letter, Agreement for finance, DP note, Guarantee, Memo of deposit of title deeds, Mortgaged deed, Irrevocable general power of attorney, Charge of bank lien, Letter of continuity, Letter of arrangement, Confirmation and undertaking etc.
6. The Running Finance Facility granted/renewed in the year, 2009, of course, was at the request of the Appellants and knowingly it was mark-up based. The said finance facility in the sum of Rs.12,00,000/- [Rupees twelve lacs only], though was fully availed but Appellants in their own wisdom either failed and / or avoided to liquidate the same, as per Agreement for Financing dated 30.07.2009 [Available at Page 47 of the court file]. The expiry date, as per said Agreement for Financing on Mark-up Basis was 30.06.2010. The sale price as mutually agreed and fixed by the parties is Rs.12,00,000/- [Rupees twelve lacs only] and the purchase price also fixed mutually is Rs.14,75,280/- [Fourteen lacs, seventy five thousand, two hundred eighty only].
7. Per assertions made in the Plaint, Appellant No.1, though had fully availed and utilized the said finance facility, as per Agreement For Finance on Mark-up Basis dated 30th day of July 2009, but Appellant No.1-Defendant No.1, who was / is running business through its` proprietor viz. Aqeel Hassan Khan, either failed and / or otherwise, ignored to repay the outstanding amount[s] and that too despite of time and again requests. On committing `willful default`, Respondent Bank-Plaintiff-Bank thus constrained to issue a Legal Notice of 22.02.2011 to the Appellants-Defendants for repayment of Bank`s dues. The Appellants-Defendants, nevertheless, despite of their commitments / promises, however, failed to clear the outstanding amount due to the Respondent Bank-Defendant Bank.
8. The particulars/details of the amounts of finance facility granted to and availed by Appellant No.1-Defendant No.1, the amounts repaid to the Respondent Bank-Plaintiff Bank, the balance outstanding principal amount and other financial charges, as given in the Plaint and required as per Section 9(3) of Financial Institution [Recovery of Finances] Ordinance, 2001, are as follows:-
|
a. |
Amount of Finance Principal availed as per statement of Account. |
Rs.1,200,000 |
|
b. |
Amount deposited by defendant towards Principal as per statement of account on various dates |
(-)Rs.7,047/51 |
|
c. |
Amount deposited by defendant towards markup relating to finance as per arrangements |
(-)Rs.430,917/97 |
|
d. |
Amount of mark-up outstanding from 10.11.2006 to 30.06.2011 |
(+)Rs.803,068/40 |
|
|
Total outstanding amount |
Rs.1,565,102/92 |
9. Per `assertions` made in Para-15 of Plaint, the `cause of action` had arisen in favour of the Respondent Bank-Plaintiff-Bank and against the Appellants-Defendants on dates when, various documents were voluntarily signed and executed, finance facility was granted to and availed by the Appellants-Defendants and finally when, Appellants-Defendants committed `willful default` viz-a-viz repayment of Banks dues.
10. The Respondent Bank-Plaintiff Bank thus constrained to file a Recovery Suit against the Appellants-Defendants interalia for recovery of the outstanding amount in the sum of Rs.1,565,102/92, on 18.07.2011, under Section 9 of Financial Institution [Recovery of Finances] Ordinance No.XLVI of , 2001, with the prayers as follows:-
a. Decree for Rs.1,565,102/92 may be passed against the defendants No.1 & 2 jointly and severally along with cost and Cost of fund as provided under Ordinance 2001 till realization of amount.
b. In case defendants fails to repayments of decretal amount, Mortgaged property belonging to defendants as mentioned in para No.7 of the plaint be ordered to be sold out for realization of decretal amount and also for Sale of movable and immovable property of the defendants.
c. In case proceeds of sale are found insufficient for amount under decree than money decree for remaining amount.
d. To grant/award 20% liquidated damages.
e. The cost of the suit be saddled on defendants.
f. Any other relief[s], which this Honourble Court deems fit, just and proper.
11. On filing of the aforesaid suit on 18.07.2011, process under Section 9 (5) of FIO, 2001, were issued to the Appellants-Defendants by all prescribed modes including publication in daily Newspapers i.e. `The Nation` Karachi, dated 04.08.2011 and Daily `Jang` Karachi, dated 03.08.2011. In response Appellants No.2 & 3-Defendants No.2 & 3, did appear and contest the Suit bearing No.129 of 2011 [NIB Bank Limited v. M/s CIE Computer & another], by way of filing two [2] separate Applications for Leave-to-Defend under Section 10 of Financial Institution [Recovery of Finances] Ordinance, 2001 [In short FIO, 2001]. The said Applications for Leave-to-Defend, however, were later on dismissed for `non-prosecution` vide order dated 07.02.2013, passed by Banking Court No.I, Hyderabad.
12. Nevertheless, Defendant No.3-Appellant No.3, as reflects from the record had thereafter, opted to file an Application Under Order 9 Rule 9 r/w Section 151 C.P.C, on 07.03.2013 for re-calling of the earlier order dated 07.02.2013, whereby, the two [2] Leave-to-Defend Applications, filed by Appellants No.2 & 3/Defendants No.2 & 3, were dismissed for `non-prosecution`. The said Application under Order 9 Rule 9 r/w Section 151 C.P.C however, was also dismissed by Banking Court No.I, Hyderabad, vide its` order dated 30.05.2013.
13. Subsequently, on 12.06.2013 when, the Bank`s Recovery Suit bearing No.129 of 2011 [NIB Bank Limited v. M/s CIE Computer & another], came-up before the court then, learned Banking Court-I, Hyderabad, perhaps keeping in view the nature of the Plaint and Suit, having been duly verified on Oath and supported with various documents duly singed and executed i.e. Sanction Letter, Agreement for finance, Demand Promissory Note, Guarantee, Memo of Deposit of Title Deed, Mortgaged deed, Irrevocable general power of attorney, Charge of bank lien, Letter of continuity, Letter of arrangement, Confirmation & undertaking and also annexed / supported with duly certified statement of accounts/Break-ups, finally the Bank`s Recovery Suit bearing No.129 of 2011 [NIB Bank Limited v. M/s CIE Computer & another], was decreed in favour of the Plaintiff-Respondent Bank and against the Defendants-Appellants that is to say, jointly & severally in the sum of Rs.15,65,102/- with costs.
14. Besides, `cost of funds` in terms of Section 3 of the Financial Institution [Recovery of Finances] Ordinance, 2001 [In short FIO, 2001], was also awarded i.e. from the date of `default`, till realization, as certified from time to time by State Bank of Pakistan [In short SBP]. The prayer of Respondent Bank-Plaintiff-Bank for awarding of the liquidated damage, however, was declined. Per Judgment & Decree both dated 12.06.2013, the Appellants-Defendants were also directed to pay the decretal amount within thirty [30] days i.e. w.e.f. 12.06.2013, otherwise if, the decree passed remained un-satisfied then, in such eventuality the subject mortgaged property i.e Shop No.60,constructed on Mezzanine Floor, part of Plot No.44, 44A & 44B, Survey No.57, Tayyab Complex, situated in Civil Lines, Cantonment Area Hyderabad, with construction fixtures and furniture thereon, was ordered to be sold towards` satisfaction of the decretal amount.
15. The Appellants-Defendants thus feeling `aggrieved` and `dis-satisfied` with the judgment & decree both dated 12.06.2013, have approached this court by way of the instant Ist Appeal No.44 of 2013 filed on 05.08.2013, `interalia` with a prayer to set-aside the impugned judgment & decree, passed by the Banking Court No.1, Hyderabad, in Bank`s Suit No.129 of 2011 [NIB Bank Limited v. M/s CIE Computer & another].
16. On 24.09.2018, when, the above Ist Appeal came-up before us then we heard Mr. Muhammad Asif Arain, learned counsel for the Appellants and Mr. Altaf Ahmed Shahid Abro, learned counsel for Respondent-Bank and also scanned the record available before us with their valuable assistance.
17. Mr. Muhammad Asif Arain, learned counsel for the Appellants while, arguing the instant Ist Appeal, forcefully contended that the Respondent-Plaintiff Bank`s claim[s] put forward in the suit against the Defendants was not only exaggerated but also not maintainable. Per learned counsel, the Appellants-Defendants in no manner are liable to pay such an exaggerated, exorbitant and un-warranted claim of the Respondent-Bank. Per learned counsel, the entire claim of Respondent Bank-Plaintiff Bank claimed in the Bank`s recovery suit was based on `Mark-up`, `Mark-up over Mark-up`, liquidated damages and other so called charges etc. The Respondent Bank-Plaintiff Bank, as such, is not entitled to claim such impermissible amounts under the law. Respondent-Bank, as urged, by Mr. Muhammad Asif Arain, in no event, is entitled to recover the said illegal claimed amounts from the Appellants-Defendants or any of them.
18. According to the Appellants` counsel, even the amounts paid to the Respondent-Bank, have not been appropriately adjusted towards`/against the principal amount. Rather, the paid amounts, as urged, have been adjusted/appropriated against the un-lawful, un-authorized `Mark-up`, `Mark-up over Mark-up` and / or against other amounts of charges. The Respondent Bank-Plaintiff Bank, as such, in clear cut violation of the Agreement For Financing dated 30.07.2008 [Annexed at Page 47 of the court file] cannot be allowed either to generate for its benefit illegal revenue and / or otherwise, charge `Mark-up` beyond the expiry date i.e. 30.06.2010 of Finance Agreement dated 30.07.2009. Any such `profit`/`mark-up` charged by Respondent Bank-Plaintiff Bank besides, being un-called under law cannot be allowed to be recovered from the Appellants-Defendants or any of them in clear violation of law.
19. Per the Appellants-Defendants` stand since, the claim put-forward by the Respondent Bank-Plaintiff Bank was/is exorbitant and exaggerated, as such, it would have not been allowed by Banking Court-1, Hyderabad. The actual amount due and payable by the Appellants-Defendants to Respondent-Bank, per learned counsel, for the Appellants-Defendants, is very much lesser than the decretal amount of Rs.1,565,102/-. According to Mr. Muhammad Asif Arain, the claim of Respondent-Plaintiff Bank against the Appellants-Defendants, is not only vindictive but has been designed for the benefits of Respondent-Plaintiff Bank to generate un-warranted revenue and earn thereon, more and more profits for itself, however, at the cost of customers. The entire claim of Respondent Bank-Plaintiff Bank thus besides, bogus is false. The same as such, in no event, can be recovered from the Appellants-Defendants jointly and / or severally.
20. Mr. Muhammad Asif Arain, learned counsel for the Appellants next urged, that all the subject documents were got signed in blank by bank`s officials. The claim of the Respondent Bank on this ground, as well, cannot be allowed or the decretal amount otherwise, be permitted to be recovered under the garb of a `DECREE` obtained `interalia` on the basis of blank documents. Per learned counsel, the alleged `BLANK DOCUMENTS` have been filled-up later on, by the Bank`s officials with artificial and bogus figures of their choice. Moreover, the Respondent Bank-Plaintiff Bank, despite of time and again requests has also failed to provide `statement of accounts` to the Appellants-Defendants. The principal amount left, amount deposited by Appellants-Defendants and the amount of outstanding mark-up, as such, could not be ascertained properly. The claim of Respondent Bank-Plaintiff Bank, under such scenario, is presumed to be a `bogus`, `doubtful` and exaggerated.
21. Lastly, learned counsel for the Appellants prayed for setting aside the impugned judgment & decree both dated 12.06.2013, passed by Banking Court-I, Hyderabad, in Suit No.129 of 2011 [NIB Bank Limited v. M/s CIE Computer & another] and of allowing the instant Ist Appeal consequently.
22. On the other hand, Mr. Altaf Ahmed Shahid Abro, learned counsel for Respondent Bank-Plaintiff Bank strongly opposed the stand taken by the Appellants-Defendants` counsel, by submitting that Leave-to-Defend Applications, as framed and filed by Mr. Aqeel Hassan Khan s/o Habib Khan who, besides a sole proprietor of M/S CIE Computers-Appellant No.1, is Appellant No.2 in his capacity as a guarantor in respect of the finance facility[ies] granted to and availed by Appellant No.1-Defendant No.1. The another Leave-to-Defend Application, filed by the mortgagor/Appellant No.3, was also not maintainable, as both the said Applications for Leave-to-Defend were against the mandatory provisions of Section 10 of FIO, 2001. Both the said Applications for Leave-to-Defend as being against provisions of Section 10 of FIO, 2001, even otherwise, as well, were liable to be rejected in terms of sub-section 6 of Section 10 of FIO, 2001 [Ordinance No.XLVI of 2001].
23. According to Mr. Altaf Ahmed Shahid Abro, learned counsel for Respondent Bank, the suit instituted by the Plaintiff Bank-Respondent Bank on 13.07.2011, was not only within time but also quite in accordance with the mandatory provisions of Section 9 of FIO, 2001. Per learned counsel, Sections 9 & 10 of FIO, 2001, of course, oblige the parties to the suit to plead interalia nature of accounts or head of accounts. In case of failure to comply with the mandatory provisions of law, parties to the suit then to face the consequences. Mr. Altaf Ahmed Shahid Abro, Advocate, further contended that all the documents annexed with Plaint / Memo of Appeal herein, and relied upon by the Respondent Bank-Plaintiff Bank, are not only genuine but were also duly filled-up at the time of signing of such documents. For this obvious reason, such documents were not only singed by Defendants-Appellants but the same were also returned to the Plaintiff Bank-Respondent Bank after the same were signed.
24. Per learned counsel for Respondent Bank, all the payments received by Respondent Bank, of-course, have been duly `credited` in the customer`s Account[s] maintained with the Respondent Bank. The Appellants-Defendants even otherwise, have failed to pin-point any entry in the certified statement of account[s], as being false or incorrect. It is needless to say, a Banks customer always obtain statement of account[s] inter-alia for Income Tax purposes and preparation of Balance Sheet. In the case in hand, the Appellants-Defendants before filing of the recovery Suit No.129 of 2011 [NIB Bank Limited v. M/s CIE Computer & another], have never raised any objection whatsoever viz-a-viz the alleged signing of the documents in blank. Likewise, no any entry of debt or credit in the statement of account[s] has been ever challenged / questioned. The raising of such objections `at this belated stage` are not only after thought but also seems an attempt to forestall the recovery of decretal amount, after passing of the DECREE in favour of the Plaintiff Bank-Respondent Bank on 12.06.2013.
25. With regard to the assertions made by the Appellants-Defendants that any of the amount paid by the Appellants-Defendants and received by Respondent Bank-Plaintiff Bank as alleged has been adjusted against `Mark-up`, `Mark-up over Mark-up` amounts, Mr. Altaf Ahmed Shahid Abro, Advocate while, controverting such allegations as being false, forcefully submitted that all the amounts paid to and received by Respondent Bank-Plaintiff Bank, have been rightly adjusted against the outstanding `principal amount` and `Mark-up amount`. Per learned counsel, in this regard, no any illegality, as contended by learned counsel for the Appellants, has been committed by the Respondent Bank-Plaintiff Bank. Per learned counsel for Respondent Bank, the stand as taken by the Appellants-Defendants on the face of record is not only mis-conceived but also mis-leading.
26. Heard and record perused.
27. Before proceeding further, it would be proper to refer to and reproduce herein, sub-section (3) of Section 9 and sub-sections (3), (4), (5) and (6) of Section 10 of the Financial Institutions [Recovery of Finances] Ordinance, 2001 [In short FIO, 2001], which provisions are not only mandatory but also oblige parties to the suit to identically plead / mention the nature of accounts / heads of accounts. Being relevant, the provisions of Section 9 (3) and Section 10 (3), (4), (5) and (6) of FIO, 2001 are reproduced at (a) and (b) respectively here-in-below:-
(a) 9. Procedure of Banking Courts:-
(1) .
(2) .
(3) The plaint, in the case of a suit for recovery instituted by a financial institution, shall specifically state:-
(a) the amount of finance availed by the defendant from the financial institution;
(b) the amounts paid by the defendant to the financial institution and the dates of payment; and
(c) the amount of finance and other amount relating to the finance payable by the defendant to the financial institution upto the date of institution of the suit.
(b) 10. Leave to Defend:-
(1) .
(2) .
(3) The application for leave to defend shall be in the form of a written statement, and shall contain a summary of the substantial questions of law as well as fact in respect of which, in the opinion of the defendant, evidence needs to be recorded.
(4) In the case of a suit for recovery instituted by a financial institution the application for leave to defend shall also specifically state the following
(a) the amount of finance availed by the defendant from the financial institution; the amount paid by the defendant to the financial institution and the dates of payments;
(b) the amount of finance and other amounts relating to the finance payable by the defendant to the financial institution upto the date of institution of the suit;
(c) the amounts of finance and other amounts relating to the finance payable by the defendant to the financial institution upto the date of institution of the suit.
(d) the amount if any which the defendant disputes as payable to the financial institution and facst in support thereof;
Explanation:- For the purpose of clause (b) any payment made to a financial institution by a customer in respect of a finance shall be appropriated first against other amount relating to the finance and the balance, if any, against the principal amount of the finance.
(5) The application for leave to defend shall be accompanied by all the documents which, in the opinion of the defendant, support the substantial questions of law or fact raised by him.
(6) An application for leave to defend which does not comply with the requirement of sub-sections (3), (4) where applicable and (5) shall be rejected, unless the defendant discloses therein sufficient cause for his inability to comply with any such requirement.
[Underlining is ours]
28. From bare perusal of the aforesaid provisions of law, it reflect that the Financials Institutions and Customer[s] are under a legal obligation to particularly state / plead in clear words the amount of finance availed by a Defendant from Financial Intuition, the amount of finance paid by the Defendant to the Financial Institution and dates of payments besides, other amounts pertaining to the finance and payable by a Defendant to the Financial Institution/Bank upto the date of Institution of the Suit. Apart from the above, a Defendant has been saddled with further responsibility not only to mention/specify the amount of finance if any, which the Defendant disputes as payable but also the facts in support thereof.
29. The Leave to Defend Application[s] available on record if, seen in juxta-position of aforesaid mandatory provisions of law then one can easily reach at the conclusion that the said two [2] Leave-to-Defend Applications filed by the Appellants No.2 & 3 [Defendants No.2 & 3] before Banking Court No.1, Hyderabad, in Suit No.129 of 2011 [NIB Bank Limited v. M/s CIE Computer & another], were also not maintainable and liable to be rejected under sub-section (6) of Section 10 of FIO, 2001, due to non-fulfilling the mandatory requirements under sub-sections (3), (4) and (5) of Section 10 of FIO, 2001. In the case in hand, it is significant to note, the two [2] Leave-to-Defend Applications filed by the Appellants No.2 & 3, as reflects from the impugned Judgment & Decree both dated 12.06.2013, were dismissed for non-prosecution on 07.02.2013. Even, the Restoration Application filed thereafter, by Appellant No.3/Defendant No.3, U/O 9 Rule 9 C.P.C, was also dismissed on 30.05.2013.
30. In the above scenario, being relevant reference can be made to the case of APPOLO TEXTILE MILLS LTD & OTHERS V. SONERI BANK LTD [PLD 2012 SC 268] wherein, it was observed as follows:-
19. In this case, the application for leave to defend the suit filed by the petitioners did not fulfil the requirements of section 10(3), (4) and (5) of the Financial Institutions (Recovery of Finances) Ordinance XLVI of 2001. It was admittedly not in conformity with the said mandatory provisions. No cause or the reason for inability to comply with said requirements was shown. Instead it was expressly admitted by the learned Senior Advocate Supreme Court for the petitioners before the High Court and also before us that the petitioners failed to fulfil the mandates of the said provisions and did not plead the required Accounts. The petitioners/defendants thus attracted the prescribed legal consequences of:--
(i) Rejection of their leave petition under section 10(6);
(ii) Non-entitlement under section 10(1) to defend the suit for not obtaining leave to defend the suit in terms provided for in section 10;
(iii) The allegations of fact in the plaint were deemed under section 10(1) to have been admitted by them; and
(iv) A judgment and decree against them and in favour of the plaintiff bank under section 10(1) and (11) ibid.
31. As far as, the contention of the Appellants-Defendants counsel regarding signing of documents in blank, is concerned, the same besides, being baseless, without any foundation is also contrary to the record available before us. All the documents available on record are duly filled-up and singed. The Appellants-Defendants, it is worth to mention herein have not denied the availing of the finance facility and / or signing of the documents executed therefor. On the aspect of blank documents, reliance can be placed on the case of MUHAMMAD ARSHAD AND ANOTHER V. CITI BANK N.A, LAHORE [2006 SCMR 1347] wherein, it has been held as under:-
A careful scrutiny of the entire record would reveal that agreement, dated 26-6-1999 was executed between the parties. The agreement, dated 26-6-1999 was not only signed but the petitioners also affixed their thumb-impressions on it which were never denied. We are not at all impressed by the contention raised on behalf of the petitioners that the genuineness and authenticity of the agreement, dated 26-6-1999 is not above board as the relevant columns were left blank and filled in subsequently by the Bank. For the sake of argument even if it is admitted then why the agreement dated 26-6-1999 was acted upon and pursuant whereof ten instalments had been paid and the outstanding liability was reduced from Rs.21,05,280 (mark-up price) to Rs.17,95,176. In fact the above instalments were made as per repayment schedule which was inseparable part of the agreement dated 26-6-1999. It must not be lost sight of that the main object to get the renewed agreement was restructuring of the finance facility and not liquidation of the liability. We have no hesitation in our mind to hold that agreement dated 26-6-1999 was authentic, genuine and executed between the parties and acted upon. A careful perusal of the agreement dated 26-6-1999 would reveal that mark-up was charged in accordance with the terms and conditions and stipulated therein. It is to be noted that in the agreement dated 26-6-1999 it has been stipulated in a categoric manner that the petitioners had also entered into mark-up agreement which was executed on 21-6-1995 and thus, it stood admitted by the petitioners. It would not be out of place to mention here that an amount of Rs.21,05,280 was mentioned as mark-up in the last agreement. It would be too late in the day to challenge its authenticity on the pretext of certain blank columns. The question which arises here at this juncture would be that as to why certain columns were left blank and if it was so done why the incomplete agreement was signed by the petitioners? No answer could be given by the learned Advocate Supreme Court on behalf of the petitioners. In our considered view the plea of "blank columns" would hardly renders any assistance to the case of petitioners. In view of the provisions as contained in section 20 read with section 118 of the Negotiable Instruments Act, 1881 no benefit could be given to the petitioner on the ground that the agreement was not completely filled in when executed as it would have no substantial bearing on the validity of the agreement. In this regard reference can be made to case Muhammad Sarfraz Khan Rana v. Government of the Punjab PLD 1990 Lah. 88. It is well-settled by now that "Negotiable Instruments Act provides that where one person signs and delivers to another paper stamped in accordance with law, either wholly blank or having written thereon incomplete negotiable instrument, in order that it may be made, or completed into negotiable instrument, he thereby gives prima facie authority to person who C receives that paper to make or complete it as case may be into negotiable instrument for any amount. Furthermore, section 118 of Negotiable. Instrument Act, provides that presumptions are attached to negotiable instruments, which, inter alia includes that negotiable instrument was made or drawn for consideration and that every instrument bearing date was made or drawn on such date. Held: Documents were given blank as canvassed by appellants even then appellants are estopped to challenge legality, validity and genuineness of said documents.
[Underlining is ours]
32. As far as the contention of Mr. Muhammad Asif Arain, learned counsel for the appellants viz-a-viz adjustment of the paid amounts against `Mark-up`, alleged `Mark-up over Mark-up`, is concerned, under law, Banks/Financial Institutions cannot charge and / or be allowed to charge any `Mark-up` over `Mark-up` and / or `Mark-up` beyond the expiry period of the Finance Agreement and if it has been done then, of course, such amount needs to be deducted and dis-allowed. The amounts received by a Bank/Financial Institution from a customer, however, under law can be adjusted against other amounts relating to the finance including lawfully charged `Mark-up.`
33. And the balance if any, needs to be adjusted against the principal amount of finance. In this regard, Section 10(4), `clause (b)` and relevant Explanation provided thereto is reproduced herein below:-
Clause (b) of section 10(4), F.I.O, 2001.
(a)
(b) the amount of finance and other amounts relating to the finance payable by the defendant to the financial institution up to the date of institution of the suit:
(c) ..
(d) ..
Explanation:- For the purpose of clause (b) any payment made to a financial institution by a customer in respect of a finance shall be appropriated first against other amount relating to the finance and the balance, if any, against the principal amount of the finance.
[Underlining is ours]
34. To properly appreciate, as to whether any `Mark-up` and `Mark-up` over `Mark-up`, as alleged, by Appellants have been charged by Respondent Bank-Plaintiff Bank in violation of the subject Agreement For Financing on Mark-up Basis dated 30.07.2009 [Available at Page 47 of the court file] or the position is otherwise, we would like to reproduce herein some of the `relevant clauses` from the said AGREEMENT FOR FINANCING ON MARK-UP BASIS which has been duly `signed` and `executed` by NIB Bank Limited [Respondent herein] and M/S CIE Computers [Appellant No.1 herein], as follows:-
1.1 The Customer shall sell the Assets to the Bank during the period ending 30.06.2010 for a total sum of upto Rs.1,200,000/- (Rupees One Million Tow Hundred Thousand Only) (herein referred to as the Sale Prince).
1.2 The Customer confirms and agrees that after sale of the Assets to the Bank the Customer shall be deemed to have immediately re-purchased the Assets from the Bank at a price of Rs.1,475,280/- (Rupees One Million Four Hundred Seventy Five Thousand Two Hundred Eighty Only) (hereinafter referred to as the Purchase Price).
1.3 The Purchase Price shall be paid by the Customer to the Bank in such installments and at such times (each a 30.06.2010) as the Bank may prescribe.
[Underlining is ours]
35. Evidently, in terms of the aforesaid Agreement for Financing on Mark-up basis dated 30.07.2009 [Appearing at Page 47 to MoP], the mutually agreed Sale Prince is Rs.1,200,000/- [Rupees twelve lacs only] and purchase price fixed mutually is Rs.1,475,280/- [Rupees fourteen lacs seventy five thousand and two hundred eighty only]. The agreed period in terms of `clause 1.3` for repayment of the purchase price of Rs.1,475,280/- is 30.06.2010. The `Mark-up amount`, as agreed in terms of the aforesaid Agreement for Financing on Mark-up Basis thus comes to Rs.2,75,280/- [Rupees two lacs seventy five thousand and two hundred eighty only], i.e. Rs.1,475,280/- [-] Rs.1,200,000/-.
36. The total agreed amount of `Mark-up` thus payable by the Appellants to Respondent Bank is Rs.2,75,280/- [Rupees two lacs seventy five thousand and two hundred eighty only]. Admittedly, the Appellants-Defendants have paid out of the agreed purchase price of Rs.14,75,280 /- a sum of Rs.4,37,965/48 which paid amount if, deducted from the agreed purchase price of Rs.1,475,280/-, the balance outstanding amount comes to Rs.10,37,314/52 [Rupees ten lacs thirty seven thousand three hundred fifteen and fifty two paisas] i.e. [Rs.14,75,280-Rs.4,37,965].
37. For and in view of the above, we are of the considered opinion that Respondent-Bank-Defendant Bank is entitled to have a decree in its` favour only for a sum of Rs.10,37,314/52 [Rupees Ten Lac Thirty Seven Thousand Three Hundred Fourteen and Fifty Two Paisas only] against the Appellants-Defendants jointly and severally with cost and cost of funds in terms of Section 3 of FIO, 2001 w.e.f. 01.07.2010 till realization of the Decretal amount and also for a Final Decree for sale of the mortgaged prosperities, as referred to and described in `Para 2 of the Plaint`.
38. Upshot of the above discussion is that while allowing this Ist Appeal No.D-44 of 2013 partly, at pre-admission stage, the impugned judgment & decree both dated 12.06.2013, passed by Banking Court No.1, Hyderabad, are hereby modified in terms of Para 37 hereof and consequently the Bank`s Suit No.129 of 2011 [NIB Bank Limited v/s M/S CIE Computers & 2 others] stands decreed accordingly.
39. Ist Appeal partly allowed. Parties to bear their own costs.
JUDGE
JUDGE
Hyderabad.
Dated. 11.10.2018.
Tufail