Law: Financial Institutions (Recovery of Finances) Ordinance, 2001

Section: 15,15(5)(6)(7)(8)(9)(10)(11)(12),19,19(7 )(a),22

Law: Civil Procedure Code (V of 1908)

Section: O.XXI,R.95,96

Financial Institutions (Recovery of Finances) Ordinance (XLVI of 2001)--- ----Ss. 19 & 15---Execution of decree of Banking Court---Sale of mortgaged property---Lease of mortgaged property---Claim(s)/objections of lessee before Banking Court where mortgaged property was leased---Adjudication of such claims---Assumption as to whether lease was bona fide or not---Criteria for determining bona fide of a lease of mortgaged property---Date of creation of lease not the sole determining factor as to bona fide of a lease of mortgaged property---Scope---Use of the word "shall" in S. 19(7)(a) of the Financial Institutions (Recovery of Finances) Ordinance, 2001 made it mandatory for Banking Court to investigate every claim and objection in respect of attachment or sale of mortgaged property---Banking Court could not dismiss claim/objections of a purported lessee of mortgaged property on ground that existence of lease in their favour did not constitute a claim under S. 19(7) of the Financial Institutions (Recovery of Finances) Ordinance, 2001---Any claim or objections which were preferred by a lessee of mortgaged property could not be rejected by Banking Court straightaway without first determining whether such lease was bona fide or not---Criteria for determining whether a lease was bona fide or not was contained in S. 15(7) of the Financial Institutions (Recovery of Finances) Ordinance, 2001 where it was provided that if a lease was created after date of mortgage which appeared to have been created so as to adversely affect value of mortgaged property or to prejudice rights and remedies of the financial institution, then such lease would be presumed to be not bona fide unless proved otherwise---Creation of lease after date or mortgage was therefore not the sole criteria for determining whether a lease was bona fide or not---Once a determination per the criteria was made, Banking Court through a speaking order, would decide if a lease of mortgaged property was bona fide or not. THIS JUDGMENT DELIVERED BY: NADEEM AKHTAR, J.--- Through this appeal under section 22 of the Financial Institutions (Recovery of Finances) Ordinance, 2001, ('the Ordinance') the appellants have…

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