Law:

Section:

Financial Institutions (Recovery of Finances) Ordinance (XLVI of 2001)-------Ss. 2, 9 & 10---Specific Relief Act (I of 1877), Ss.42 & 54---Civil Procedure Code (V of 1908), O. VII, Rr.10 & 11---Suit against principal debtor and Bank for declaration, permanent injunction and recovery of amount---Failure of principal debtor to discharge his financial obligations with Bank through sale of pledged goods--Plaintiff's plea that he at inducement of Bank agreed, to purchase pledged goods against payment to credit of principal debtor and as such he was indemnifying Bank; that Bank later on illegally stopped delivery of pledged goods despite receiving its price, due to which plaintiff suffered huge loss for failing to fulfil commitment with his customers---Leave applications by defendants seeking rejection or return of plaint on ground of lack of jurisdiction of Banking Court and in alternative unconditional leave to defend suit on grounds that neither plaintiff was customer of Bank nor did any agreement exist between plaintiff and Bank nor had plaintiff claimed any relief against Bank---Validity---Held, it was necessary for invoking jurisdiction of Banking Court that subject-matter of suit should be finance and plaintiff should be a customer of financial institution---Customer would be that person to whom finance was extended by a financial institution or on his behalf a guarantee or letter of credit was issued by a financial institution or who was a surety or an indemnifier---Plaintiff had not claimed that principal debtor had caused any loss to Bank and for payment of such loss, plaintiff was depositing into account of principal debtor---Plaintiff was receiving pledged goods against payment into account of principal debtor, thus, no privity of contract existed between plaintiff and Bank---Bank had not allowed any finance to plaintiff nor plaintiff had executed an agreement of indemnity in favour of Bank on behalf of principal debtor--Not necessary in contract of indemnity for indemnifier to act at request of debtor---In absence of any agreement of indemnity, inference would be that Bank was acting on instructions of principal debtor and was releasing its…

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