Order Sheet

 

IN THE HIGH COURT OF SINDH KARACHI

 

First Appeal No.28 of 2017

 

Date

                                Order with signature of Judge

 

Hearing Case (Priority) :

1. For hearing of CMA No.1804/2017 (Stay) :

2. For hearing of Main Case :

 

12.11.2018 :     Mr. Khaleeq Ahmed, advocate for the appellants.

 

   Mr. Haris Rashid Khan, advocate for the respondent No.1-bank.

 

                           Syed Danish Ghazi, advocate for respondents 2 and 3.

…………

 

            The appellants have impugned the order passed on 13.05.2017 by learned Banking Court No.IV at Karachi in Execution No.10/2015 whereby their application under Order XXI Rule 1 CPC read with Section 19 of the Ordinance of 2001 was dismissed and the highest bid of Rs.52,500,000.00 made by one Muhammad Adnan Ansari was accepted.

 

            Vide judgment and decree dated 12.12.2014 and 04.02.2015, respectively, Suit No.44/2013 filed by the respondent No.1-bank against the appellants and respondents 2 and 3 was decreed jointly and severally against them by learned Banking Court with costs in the sum of Rs.13,992,250.32 with cost of funds thereon from the date of default till realization, and sale of the mortgaged property was also ordered. Thereafter, Execution No.10/2015 was filed by respondent No.1 wherein the decretal amount was shown as Rs.14,027,676.32 including the principal amount of the decree and cost of funds calculated thereon. On 25.04.2017, the appellants filed an application before the learned executing Court praying that they may be allowed to satisfy the decree by depositing the decretal amount in Court ; and on 05.05.2017, they filed a statement before the learned executing Court stating that they have paid / deposited an amount of Rs.14,000,000.00 in partial satisfaction of the decree, details whereof were mentioned in the said statement, and that they were liable to pay only an amount of Rs.4,574,353.00 as per the decree.

 

            The above application filed by the appellants was dismissed by the learned executing Court vide impugned order dated 13.05.2017 by holding that they had failed to comply with the order dated 26.04.2017 whereby they were directed to deposit amount equivalent to the highest bid of Rs.52,500,000.00. The operative part of the said order dated 26.04.2017 reads as under :

 

“5.       In view of above position the acceptance or otherwise of the highest bid is adjourned for 15 days, the J.D. No.3 may deposit remaining amount within 15 days as offered by him. The J.D. No.3 will deposit the same amount as per highest bid offered today. In case the J.D. No.3 fails to pay the amount, the (!) necessary order will be passed on highest bid as offered today, till then applications filed by the J.D. No.3 referred in para No.1 shall remain pending.”  (Emphasis added)

 

            Perusal of the above application dated 25.04.2017 filed by the appellants shows that they had offered to deposit the decretal amount to satisfy the decree and had prayed accordingly. According to the above-quoted order passed on the said application, they were allowed to deposit remaining amount within fifteen (15) days as offered by them which clearly means that they were required to deposit the remaining amount as per the decree. However, they were further directed through the above-quoted order to deposit the amount equivalent to the highest bid offered on that date. The above contradiction in the order dated 26.04.2017 is apparent on the face of the order as both the above directions contained therein are contradictory. The appellants could not comply with both the said directions at the same time as they could deposit either the remaining amount of the decree or the amount equivalent to the highest bid. Despite the above contradiction, the said order dated 26.04.2017 was made the basis by the learned executing Court for dismissing the application filed by the appellants by holding that the said order for deposit of the amount equivalent to the highest bid was not complied with by them.

 

            In paragraph 4 of the impugned order, it was observed by the learned executing Court that the appellants have deposited Rs.18,574,353.00. It is conceded by learned counsel for respondent No.1 that the appellants have paid / deposited the principal amount of the decree and major portion of cost of funds thereon. He, however, submits that a portion of the decree still remains to be satisfied as further cost of funds accrued on the principal amount is still outstanding against the appellants. He further concedes that the amount of the said outstanding cost of funds is nominal as compared to the amount already deposited by the appellants. It is an admitted position that the appellants have deposited an amount of Rs.18,574,353.00 as against the decretal amount of Rs.13,992,250.32 with cost of funds thereon, and the learned executing Court was fully aware of this important fact at the time of passing of the impugned order. In such circumstances, sale of the mortgaged property was not justified and it ought to have been postponed for a reasonable time to enable the appellants to pay the remaining / nominal outstanding amount of cost of funds.

 

            In view of the above, the impugned order is hereby set aside by directing the appellants to satisfy the remaining part of the decree within thirty (30) days. In case they fail to do so within the stipulated period, the learned executing Court may proceed further strictly in accordance with law.

 

     J U D G E

 

 

 

       J U D G E

*IA No.28-17/12.11.2018/Short Orders DB/Court Work/E*