Banking laws and

practice
Recovery Ordinance 2001

Presented to:
Mr. Zargham Ullah khan
PRESENTED BY:
MUHAMMAD BILAL NAQVI M11BBA049
ASAD RIAZ
M11BBA045
ALI HAMZA
M11BBA071
SIDDIQUE DABIR
M11BBA074
RABANI INTIZAR
M11BBA032
MUHAMMAD DANISH MAJID M11BBA044

BANK ALFALAH
V/S
SHOUKAT ZAMAN (KHAN)

Suit filed :

before the judge, banking court no.1

Lahore.
Jurisdiction under Section 9 of the financial institution
(recovery of finances ordinance 2001)

Presented by Mr. Ahmad Pervaiz advocate at 12:10 pm

on 02-01-2010

The suit bears court fess of 15000/-

(sufficient/insufficient) to the extent of

/-

SUIT FOR RECOVERY OF LOAN OF 10,68,888.03/-(ONE

MILLION SIXTY EIGHT THOUSAND EIGHT HUNDRED AND

EIGHTY EIGHT RUPPES AND THREE PAISAS ONLY)

The notices are given in the daily English

and Urdu news papers on 20 Jan 2010.

Summon has been sent BY the court

under section 9(5) in form no 4 to the
defendant on 13-01-2010

Officers power of attorney

1. Mr. Ayyaz Mehmood butt
2. Mr. Jamshed Yousaf .

LOAN AGREEMENT
19-07-2005

REQUEST FOR THE FACILITY

DEFENDANT APPLIED FOR THE FACILITY ON 1907-2005.
PLAINTIFF BANK APPROVE A FACILITY FOR RS.
1,000,000/ TERMS AND CONDITONED WAS GIVEN TO THE
DEFENDANTS.
TERMS AND CONDITION WAS DULY ACCEPTED BY
THE DEFENDANTS.

SIDDIQUE DABIR

M11BBA074

AGREEMENT:
AGREEMENT IS MADE ON 16-08-2005.
THE DEFENDANT HAS MAINTAINING AN
ACCOUNT WITH THE BANK.
BANK APPROVED TO FINANCE THE
CREDIT FACILITIES.
MORTGAGER IS THE LAWFULL OWNER OF
THE PROPERTY DESCRIBED.

AGREEMENT:
THE MORTGAGOR IS THE GURANTOR OF
THE FACILITY FOR RS.1,000,000/ IN CASE DEFENDANTS COMMITS DEFAULT
THE BANK HAS RIGHT TO:
1. SERVE NOTICES TO DEFENDANT TO REPAY.
2. FILES A SUIT IN THE BANKING COURT
3. SELL/TAKE POSESSION OF THE PROPERTY
TO RECOVER THE FUNDS.

Description of mortgage
property:
05 marlas 17 sq.ft consisting of 1142/1550
share of 07 kanals 25sq.ft commonly known
as plot no.4 Muhammad din Park ,
The estimated value of the mortgage
property is 18,40,000/- on this day 16 -082005

AGREEMENT FOR FINANCING ON

MARKUP BASES:
REQUESTED FACILITY OF 1,000,000/RUNNING FINANCE.
RS.1,260,000/- WHICH IS PAYBLE TO THE
BANK (PRINCIPLE +INTEREST) BY THIS
AGREEMENT.

PROMISSONARY NOTE:
SIGNED BY THE DEFENDANT
DEFENDANTS PROMISE TO PAY TO THE
BANK A SUM OF RS.1,260,000/-

UNDERTAKING:
DEFENDANT UNDERTAKE THAT HE SHALL
ALWAYS FOLLOW ALL THE REGULATIONS
OF SBP.
ANY PENALTIES CHARGED BY THESE
REGULATIONS ON BE DEFENDANTS
ACCOUNT.

MORTGAGE DEED:
SIGNED AT LAHORE ON 16-08-2005.
THE DEFENDANT MORTGAGE THE PROPERTY IN
THE FAVOR OF PLAINTIFF BANK.
THE MORTGAGOR SHALL ,DURING THE
COUNTINUANCE OF THE MORTGAGE INSURED
THE PROPERTY.
THE MORTGAGOR SHALL PAY ALL RENTS/TAXES
TO THE MORTGAGED PROPERTY
IN CASE OF ANY DEFAULT THE PLAINTIFF BANK
CAN SELL/TAKEPOSSESSION OF THE PROPERTY.

RENEWAL Policies:
THE DEFENDANTS APPLIED TO THE BANK FOR
THE RENEWAL OF THE FACILITIES AND GRANTED
BY THE BANK ON FOLLOWINF DATES:
04-09-2006
31-08-2007
01-09-2007
31-08-2008
19-09-2008
30-09-2009
28-04-2009
30-09-2010

ASAD RIAZ

M11BBA045

Plaint:
Amounts were disbursed to the
defendant
Defendant failed to perform their
legal obligation for the financing
availed on 28/04/2009
Bank has sent the letters to the
defendant to perform his
obligations..

Plaint
plaintiff claim
As per record maintained by the bank
A sum of Rs. 1068888.03/- (one million sixty eight

thousand eight hundred eighty eight and three paisas

only) owed to the plaintiff bank by the defendant bank.

9(3) (a) amount of finance availed by the defendant

Rs.1,000,000/-

9(3) (b) amount paid by the defendant toward

the finance

Rs.(not mentioned)

Plaint
plaintiff claim
(9) (3) (c) amount of finance and other amounts
relating to the finance payable by the

defendants towards the bank:

PRINCIPAL: RS. 9,42,326.46
MARK UP: RS. 126,561.57
TOTAL :
RS: 1,068,888.03
(statements of accounts are duly verified in
accordance with the bankers book evidence act,
1891 and recovery ordinance has an integral
part of this plaint)

Plaint
plaintiff claim
the defendants have and
continue to commit wilful
DEFAULT in repayment
Repeated request have failed
to clear their liabilities.
Hence, this suit.

Plaint
plaintiff claim
the cause of action arose in favor of the
plaintiff bank
the cause of action also arose every
time the above mentioned:
Were executed
Mortgage was created
Defendants defaulted in making
their payments
Defendants continue to be In default

Plaint
plaintiff claim
19) that the parties reside and carry on their
business in Lahore

documents above are also executed in Lahore

The facility was also granted at Lahore
Lahore is where the cause of action arise
The Honourable Court has the exclusive jurisdiction
to:
a) Entertain this case
b) Adjudicate this matter

Plaint
plaintiff claim
20) that the value of the suit is Rs. 1,068,888.03
(one million sixty eight thousand eight
hundred eighty eight and three paisas only)
and the maximum court fee of the Rs.
15000/- has been affixed on the plant.

prayer
In the view of the Aforesaid most respectfully said that the

court may be pleased to pass the decree in favor of the

plaintiff and against the defendant in the following manner

a)

for the recovery of Rs. 1,068,888.03/- (one million sixty

eight thousand eight hundred eighty eight and three
paisa's only)

b)

The mark up and cost of funds , charges from the date

of default till realization of decretal amount

prayer
c) The property mortgaged in favor of the
plaintiff be ordered to be sold for satisfaction
of the HONOURABLE COURTS DECREE

d) personal assets or other properties of the

defendants be attached and sold for the
satisfaction of the decree in favor of the
plaintiff bank.

prayer
e) in case the decree cannot be satisfied through the
liquidation the assets , the defendants may be
arrested and detained I the civil prison in
accordance with the law.
f) Costs of the suit and other expenses incurred and to
be incurred in this regard may also be awarded;
g) Any other relief that this honorable court deems fit
and proper under the circumstances of the case
may also be granted.

prayer
Verification:
verified on oath at Lahore this 1st day of
Jan 2010 that the contents of paragraphs
number 1 to 17 are true to the best of my
knowledge and that the contents of paragraphs
number 18 to 20 are believed to be true as per
information received.

RABBANI INTIZAR
M11BBA032

Defendant claim:
In the court of judge banking court No 1
Lahore
Bank Al-falah V/S Shukaht Zaman etc.

on behalf of defendant under section

10 of the financial institution
recovery of finance ordinance 2001
for the grant of unconditional leave
to appear and defend the suit

POWER OF ATTORNEY:
1. ALI SAJID MIRZA. ON BEHALF OF THE
DEFENDANT.
TO ACT AND APPEAR AND PLEAD IN THE
CASE
TO PRESENT PLEADINGS AND APPELAS
CROSS OBJECTIONS OR PETITIONS

AFFIDAVIT:
Affidavit of Shaukat Zaman son of Khalil-urRahman resident of house no
shadbagh Lahore.

a. That the contents of the accompanying

application may kindly be read as
integral part of this affidavit.
b. That the contents of the
accompanying application are correct
and true to the best of my knowledge
and nothing has been concealed
therefrom.

Defendant claim:
1. That the plaintiff has not come to this
honorable court with clean hands hence
suit is liable to be dismissed.
2. That the plaintiff has no cause of action
against deponent hence the suit is
liable to be rejected.
3. That the suit of plaintiff is based on
malice and concoction which is totally
based on the futile imagination of the
plaintiff. So, the same is liable to
dismissed with special cost U\S 35 A

Defendant claim:
4. that the following substantial question of law
and facts arise for determination by his
honorable court for which leave to defend is to
be granted to the applicant / defendant in the
interest of justice
I. Whether the plaintiff has not come to this
honorable court with clean hands, Hence the suit
is liable to be dismissed .

II.

Whether the plaintiff has no cause of action

against answering defendant hence the plaintiff
is liable to be rejected as it evident from the
clause 18 where no specific date default is
written as the space is left blank which proves

Defendant claim:
it is humbly submitted that no proper
authorization is given to Mr.ayyaz mahmood
and Muhammad jamshed Yousaf
U/S 13 rule 1.2.3 it is mandatory
provision that all the document must be
original to be presented before the court
when the suit is filed.

ALI
HAMZA
M11BBA071

Defendant claim:
It is submitted in this context that the
defendant / petitioner obtained the finance
facility which is obtained on the basis of
running finance facility for the running of
his business the defendant / petitioner
the plaintiff obtained facility on 19 .
07.2005
to the extent of
Rs. 10,00.000
paid more than 35,00,000

Defendant claim:
in the month of August 2009 on
the request of the bank
authorities Defendants/
petitioners paid Rs. 55,000/- to
the bank with the commitments
the matter be settled amicably

Defendant claim:
instead of issuing the NOC to
the Defendants/ petitioners the
Defendants/ petitioners came
by surprised when on
15.03.2010 a notice by hand is
served upon by the server of
this Honorable court regarding
the pendency of this titled suit.

Defendant claim:
It is further to be added that as per
rules and based upon numerous
judgments of Apex courts the cases
must be decided on merits rather than
on technicalities as the Defendants/
petitioners never ever defaulted ,
therefore, under this score only the suit
is liable to be dismissed.

Defendant claim:
furthermore on probing into the matter
it that the suit is just filed to blackmail
and harassed the Defendants/
petitioners.
from clause 18 there is no specific date
upon when the Defendants/ petitioners
became defaulters.
On this score this suit is liable to be
dismissed.

Defendant claim:
(renewal facility)
The Defendants/ petitioners never
requested to further renewal of the
facility,
The bank to maintain his books good
requested the defendants for renewal
of the facility.
The Defendants are in good books of
the bank so they are renewing his
finance facility.

Defendant claim:
4th feb 2011 lastly
The defendant paid Rs. 30.000/upon the assurance firstly that the
bank never initiate any
proceedings against the defendant.
the mortgage property of the
defendant / petitioners will be
released along with the issuance of
NOC to the defendant /petitioners

Defendant claim:
(renewal facility)
Defendant never ever requested
for the renewal of the plaintiff
bank.
Defendant never ever defaulted in
the repayment of the loan debt.
Defendant has paid more then
RS.35,000,000/- to the plaintiff
bank.

Defendant claim:
Para no 16 is denied vehemently and categorically
nothing is due against the defendant /petitioners.
It is important to mention here that the
defendant /petitioners availed the running finance
facility Rs. 10.00.000/ in the year 2005 and till
august 2009 paid more then RS 35.00.000/
in the month august 2009 to settle the matter the
plaintiff bank demanded RS. 55.000 which was paid by
the defendant /petitioners

Defendant claim:
Para no 16 is denied vehemently and
categorically nothing is due against the
defendant /petitioners.
Also the plaintiff bank has failed to determine
the amount of default.
para no 17 is denied as the Defendants/
petitioners never ever defaulted in the
payment

Defendant claim:
No cause of action is accrued
in the favor of the plaintiff and
against the Defendants/
petitioners because the
Defendants/ petitioners never
ever defaulted in the payment
nor any specific date default is
written in the plaint.

BILAL NAQVI

M11BBA049

Defendant prayer:
It is therefore, most
respectfully prayed that this
application may very kindly be
accepted and leave to appear
and defend the suit may also
be granted to the defendant or
in alternative the suit of the
plaintiff be dismissed inliming in the light of Para no
18 of the plaintiff

Summary:
No desion from 2/01/2010 until now.
The bank has malafied intension regards to the
property that mortgaged.
Due to malafied intensions bank didnt recognize
the payments made by the

client .

Plaintiff bank did not mentioned the date of

default in clause 18. under section 9 of the

ordinance it is mandatory to mention the date of

default

Summary:
The financial institution

didnt give the original

documents in the court that is mandatory by section

9 (1).
In the month of August 2009 the defendant paid 55000

to the bank for the settlement of account but bank

didnt issue NOC to the defendant and defendant come
by surprised when 15/03/2010 notice by hand is served
upon by court.

As per apex court decision that the defendant never

defaulted the case should be dismissed on this score.

The defendant never requested to further renewal of

the facilities but bank did it.

Summary:

The bank official gave assurance to defendant that

if defendant has paid 30000 on 4th February 2011
then bank will issue NOC and never proceeding
against the defendant.
The defendant paid 30000 to the bank official but
bank didnt issue NOC and gave samon to the
defendant.
The bank has failed to determine the amount of the
default
Under section 9(3) C the amount of default and the date of
default must be mentioned in the plaint.

Solutions
Due to the lack of employment in judiciary
sector the case is still pending in court The
government should employ more judges. so
the case should be given decision on time
The court should identify the malafied
attention of the bank and should give the
decision accordingly as early as possible
because of the pending decision the property
value is deteriorating

Solutions
The fact of corruption cab be clearly observed in
this case the bank has not even mentioned the
date of default but still case pending when the
main conflict clause is not there

As per law the plaintiff should submitted all

original documents in front of court but the can

not presented them as they have malafied
attention in this case

The malafied attention of the plaintiff are clearly

exposed after receiving the settlement amount
instead of issuing the NOC the bank issued semen
to the client

Solutions
The banking court is not following the instruction
of higher court as per law the decision of Apex
court is consider as final decision but the decree
given by higher court is not implemented

The defendant didn't wanted to extend the period

of loan but the bank did it itself and it resulted in
default as per the claim of the bank

The bank official were indulge in bribes they

approach the defendant for the settlement of the

case but it never helped and once again the
defendant was exploited the bank should hire
personnel who should be loyal to the financial
institutions

Thank You