The BANK OF PUNJAB vs AGRI INTERNATIONAL Ss — 2025 CLD 1244 LAHORE-HIGH-COURT-LAHORE

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The BANK OF PUNJAB VS AGRI INTERNATIONAL Ss. 9(3), 10(4)(5) & 10(4)(7)---Suit for recovery filed by Bank---Default, incidence of---Scope---The incidence of default was fully narrated in the plaint in compliance with the requirements of S. 9(3) of the Financial Institutions (Recovery of Finances) Ordinance, 2001 ('the Ordinance 2001')---Rather notably, the defendants did not fulfill the mandatory requirements of S. 10(4)(5) and (7) of the Ordinance, 2001 and as such, the PLA merited to be dismissed on this single score alone---Defendants failed to raise any substantial question of law and fact which required recording of evidence---High Court rejected the PLA of the defendants---Nevertheless, minute perusal of the statement of accounts appended with the plaint revealed that the plaintiff / Bank had claimed mark-up beyond the period of expiry of the Facilities which could not be granted to the plaintiff / Bank ; as such, the plaintiff / Bank is only entitled to recover the amounts excluding said amount---Suit filed by the Bank was decreed accordingly. Citation Name: 2025 CLD 1244 LAHORE-HIGH-COURT-LAHOREBookmark this Case The BANK OF PUNJAB VS AGRI INTERNATIONAL S. 9---Suit for recovery filed by Bank---Status of guarantor denied by defendant(s)---Plea of two Defendants (Nos. 4 and No.5) from a total of six defendants, including Partnership-entity/customer (defendants-in-question) was that they (defendants-in-question) had not executed their guarantees and as such, they were unnecessarily impleaded as parties to the suit---Validity---Record reveals that by virtue of relevant Partnership Deed dated 27.09.2004, Defendants Nos. 2 & 4 were its partners---On 20.11.2004, the number of partners soared to four but the same were reduced to two i.e. defendants Nos. 2 and 3 through Partnership Deed dated 25.03.2006---As such, defendants-in-question did not remain the partners of defendant No. 1 /entity thereafter, however, as third party they provided personal continuing guarantees having stakes in Group entities---Record depicted that defendants-in-question executed their continuing personal guarantees dated 15.05.2006 which were appended with the plaint with respect to each Facility obtained by entity / defendant No. 1---Similarly, continuing personal guarantees dated 01.03.2007 were also on record---Defendants Nos. 2 to 4 also executed their fresh personal guarantees dated 02.08.2010 along with defendant No. 6 which executed its corporate guarantee in favor of the plaintiff / Bank---Defendants-in-question in their original PLA claimed that their personal guarantees were fake and forged---Later through an amendment, it was stressed that guarantees were invalid as the special condition of Facility Offer Letter dated 25.10.2025 mandating them to tender their personal guarantees was waived by the plaintiff / Bank---The argument was self-defeating in as much as by resorting to subsequent plea, it was unequivocally accepted that prior to the claimed waiver, personal guarantees on record had indeed been furnished as maintained by the plaintiff /Bank---Letter dated 02.02.2011 relied upon in said behalf simply stated that the competent authority of the plaintiff /Bank had approved to waive off the special condition pursuant to request dated 28.12.2010 as contained in Facility Offer Letter dated 25.10.2010---However, there was no evidence on record that the said approval was acted upon by discharging the personal guarantees of defendants-in-question on record, which in their terms, were continuing in nature, unequivocally guaranteeing the repayment of the Facilities of defendant No. 1 /entity in the event of default---This was particularly so when the plaintiff /Bank maintained that the letter dated 02.02.2011 was never acted upon on account of failure of defendant No. 1/entity to replace expired pledged stock and subsequent default, whereafter, the Facilities were not renewed---As such, defendants-in-question had failed to demonstrate that they were unnecessarily arrayed as defendants since they had executed guarantees to secure the facilities extended to defendant No. 1/entity---Hence, the defendants failed to raise any substantial question of law and fact which required recording of evidence---High Court rejected the PLA of the defendants---Nevertheless, minute perusal of the statement of accounts appended with the plaint revealed that the plaintiff /Bank had claimed mark-up beyond the period of expiry of the Facilities which could not be granted to the plaintiff / Bank---As such, the plaintiff / Bank was only entitled to recover the amounts excluding said amount---Suit filed by the Bank was decreed accordingly. Citation Name: 2025 CLD 1244 LAHORE-HIGH-COURT-LAHOREBookmark this Case The BANK OF PUNJAB VS AGRI INTERNATIONAL Ss. 9 & 10---Civil Procedure Code (V of 1908), O. VI, R. 17---Suit for recovery---application for leave to defend filed---application seeking amendments in the application for leave to defend---Maintainability---One of the defendants (applicant) filed an application under R. 17 of O. VI of the Code of Civil Procedure, 1908, seeking amendments in the application for leave to defend (PLa)---Plea of the applicant was that he had been wrongly impleaded as a defendant (customer of the plaintiff /Bank ) whereas he was no more a partner; neither he was mortgagor nor an alleged guarantor for enforcement of liability of other defendants arrayed by the plaintiff /Bank, as such, the guarantees appended with the plaint contained fake and fictitious signatures of the applicant---Plaintiff / Bank raised objection on the maintainability of application seeking amendment on the ground that the Financial Institutions (Recovery of Finances) Ordinance, 2001 ('the Ordinance, 2001') was a special law and as such, no miscellaneous application could be filed and entertained before the decision of PLa---Held, that where amendments sought for were supplementary and not destructive, the same could be allowed to be raised and even the limitation would not come in its way---The only consideration should be that plea(s) should not be inconsistent or divergent to the pleas raised earlier and there was no bar to move such an application---Principle of amendment in pleadings enshrined in O.VI, R.17 of the C.P.C. could be pressed with respect to amendment in the PLa---In the present case, the applicant in his original joint PLa with other defendants already raised the plea(s) he had raised in his application seeking amendment in PLa---applicant while placing reliance upon two previous letters ('letters-in-question'), had taken an additional plea that the waiver of special condition had been contained in the last Facility Offer Letter---Plaintiff / Bank (in its reply to application seeking amendment) had not disowned the letters-in-question, though it took / stated a different version---applicant primarily pleaded that the said letters be placed on record and their effect be considered while deciding the PLa---High Court directed that let the letters-in-question be made part of record and the same would be considered while deciding the PLa in the light of respective stances of the applicant and the plaintiff / Bank---application under O. VI, R. 17 of Civil Procedure Code, 1908, filed by defendants, was allowed accordingly.

The BANK OF PUNJAB vs AGRI INTERNATIONAL Ss — 2025 CLD 1244 LAHORE-HIGH-COURT-LAHORE

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