IN THE HIGH COURT OF SINDH AT KARACHI

(Original Jurisdiction)

 

Suit No. B-99 of 2008

 

Present:

Mr. Justice Irfan Saadat Khan.

 

Plaintiff, Royal Bank of Scotland (RBS), through Mr. S. Riaz Haider, advocate.

 

Nemo for the defendant.

 

Date of hearing:   12-8-2010.

 

 

JUDGMENT

 

IRFAN SAADAT KHAN, J:– The plaintiff has filed this suit against the defendant for recovery of Rs.71,352,976.27 under Financial Institutions (Recovery of Finance) Ordinance, 2001, with the following prayers:-

 

a)                  Judgment and Decree against the Defendant in the sum of Rs.71,352,976.27 with mark-up @ 25% from the date of institution of the suit along with cost of funds and other charges till realization /payment of the entire outstanding /decreetal amount.

 

b)                  Final decree for the sale of mortgage property mentioned in paragraph No.4 above in favour of the plaintiff.

 

c)                  Cost of the Suit.

 

 

Brief facts of the case are that the plaintiff is a Banking Company (formerly ABN Amro Bank) and is engaged in the business of providing finances to its customers inter-alia consumer finance relating to and under the name of Home Loans. It is stated that the defendant applied for finance facility which was sanctioned and provided to the defendant by the plaintiff on the conditions mentioned in the Finance Agreement under Account No.148077005 and for the said purpose the defendant executed agreement for financing on mark-up basis dated 29.05.2006, in favour of the plaintiff on the conditions mentioned therein. It is further stated that in addition to the above security, the defendant created an equitable mortgage in favour of the plaintiff by executing a Memorandum of Deposit of Title Deeds for the amounts and on the conditions mentioned therein and deposited original title documents of their property being Residential Plot of land bearing No.3-B/I, 29th Street, Phase-V Extension, DHA, Karachi measuring 500 sq. yds. with one unit Bungalow (Ground Plus One) thereon. It is averred that despite repeated requests by the plaintiff, the defendant failed to repay and adjust the said facility. According to the plaintiff as on 24.10.2008 an amount of Rs.59,460,813.56, without damages and including 20% damages Rs.71,352,976.27, is outstanding and payable by the defendant to the plaintiff alongwith cost of funds and other charges. The details of the amount of facility extended by the plaintiff and availed by the defendant as well as repayment and the balance amounts outstanding are as under:-

 

            1)         Loan amount disbursed                                      Rs.14,070,000.00

 

            2)         Amount pay back in 216 monthly installments      Rs.64,060,320.96

 

            3)         Amount paid (27 installments)                            Rs.  4,599,507.40

 

            4)         Remaining installment balance                           

(difference amount)                                           Rs.59,460,813.56

 

5)         20% Damages & Liquidation Charges

            on principle add-balance

            Rs.(59,460,813.56 *20%)                                   Rs.11,892,162.71

                                                                                    ______________

 

                        Total outstanding balance                                   Rs.71,352,976.27

                                                                                                =============

 

 

Hence this suit has been filed by the plaintiff against the defendant with the aforementioned prayer.

 

As per diary of the Additional Registrar (OS), dated 06.02.2009, process under Section 9(5) of the Financial Institution (Recovery of Finances) Ordinance, 2001 was issued to the defendant by all four (4) modes of service. The plaintiff has produced the receipts of Courier, Registered Post A.D. and also publications in newspapers i.e. Daily "Dawn" English dated 19.12.2008 and Daily "Jang" Karachi dated 19.12.2008, whereas the Bailiff has returned the summons unserved upon the defendant. Since during statutory period no application for leave to defend the suit has been filed by the defendant, the matter has been placed before the Court for final disposal.

 

Vide order dated 24.2.2009 the plaintiff was directed to file ex-parte proof which was filed on 2.4.2009 when the plaintiff was directed to produce the original documents in Court.  As per Order dated 8.5.2009 such original documents were produced in Court which were taken on record. Thereafter an application for return of original documents was filed which was allowed and the original documents were directed to be returned after retaining photostate copy of the same on record vide order dated 28.05.2009.

 

The defendant, having chosen to remain absent, has made himself liable to a decree as the allegation made in the plaint shall be deemed to be admitted and the plaintiff entitled to the decree.

 

The plaint in the suit is on oath and the plaintiff has also produced original documents as well as affidavit-in-ex-parte proof was also filed on 2.4.2009.  As the defendant had failed to file leave to defend application within the statutory period and, as such there is no opposition to the plaint of the suit on merits, therefore, the suit is decreed in favour of the plaintiff in the sum of Rs.59,460,813.56 with mark-up @ 25% from the date of institution of the suit along with cost of funds and other charges till realization/payment of the entire outstanding/decreetal amount. The suit is also decreed in terms of prayer clauses (b) & (c) of the prayer clause.

 

Since no evidence in support of liquidated damages has been brought on record hence the plaintiff is not entitled to liquidated damages as claimed in the suit. Even otherwise it is consistent view of Hon’ble Superior Courts that liquidated damages can only be granted in situations where loss occasioned to the plaintiff has been substantiated by cogent evidence on record.

 

JUDGE

Dated: _____ August, 2010.