Law:

Section:

Financial Institutions (Recovery of Finances) Ordinance (XLVI of 2001)-------Ss. 2(e) & 9---Suit for recovery of finance facility---Rescheduled facility---Scope---Banking Court dismissed the suit filed by bank on the ground that it was based upon rescheduled facility which was like charging markup on markup---Validity---Effect of rescheduling or restructuring of finance facility was mutually agreed by parties to be absorbed by future interest or markup till agreed date of liquidation of liability---Rescheduling, restructuring and renewal was also a facility or accommodation granted by bank to customer and the same had been recognized as 'obligation' as defined in S. 2(e) of Financial Institutions (Recovery of Finances) Ordinance, 2001---High Court set aside the and decree passed by Banking Court and decreed the suit in favour of bank---Appeal was allowed in circumstances. Habib Bank Limited v. Service Fabrics Ltd. and others 2004 CLD 1117 and Habib Bank Ltd. v. Taj Textile Mills Ltd. through Chief Executive and 5 others 2009 CLD 1143 ref. JUDGMENT M. SOHAIL IQBAL BHATTI, J.---This appeal is directed against the judgment and decree dated 2-4-2004 passed by learned Judge Banking Court-I, Faisalabad. 2. The facts of the case are that the appellant-bank filed a suit for recovery of Rs. 15,59,693 against the respondent on 22-9-2003. According to the averments made in the plaint the respondent being customer availed a finance facility amounting to Rs.23,04,000 in the year 1995. The respondent kept on availing the above mentioned running finance facility till the year 1999. Thereafter, the running finance facility which was being availed by the respondent was converted into a long term demand finance facility on the basis of mark up upon the request of the respondent. In consideration to availing of long term demand finance facility an agreement was executed and according to Schedule-B the respondent was allowed to repay the principal outstanding amount of Rs.23,04,000 in five years in sixty monthly installments. The marked up price agreed to be repaid by the respondent was Rs.37,39,860. The monthly installment agreed to be paid by the respondent was Rs.62,331…

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