| Citation(s) |
|---|
| 2026 SLG 2115 2026 SLD 2115 = 2026 SHC 676 = 2026 SHC 683 |
Sindh High Court
First Appeal No.26 of 1995
Presented By: Muhammad Faisal Kamal Alam J & Sana Akram Minhas J
Appellant: Bankers Equity Limited Through, Mr. Mirza Sarfaraz Ahmed, Advocate
Respondent No.1: East West Insurance Company Limited None
Respondent No.2: Azeem Engineering Company (Pvt) Limited None
Respondent No.3: Kamal Ghee and Allied Industries (Pvt) Limited None Date of Hearing: 15-12-2025 Date of Decision: 30-3-2026
First Appeal No.26 of 1995
Presented By: Muhammad Faisal Kamal Alam J & Sana Akram Minhas J
Appellant: Bankers Equity Limited Through, Mr. Mirza Sarfaraz Ahmed, Advocate
Respondent No.1: East West Insurance Company Limited None
Respondent No.2: Azeem Engineering Company (Pvt) Limited None
Respondent No.3: Kamal Ghee and Allied Industries (Pvt) Limited None Date of Hearing: 15-12-2025 Date of Decision: 30-3-2026
( Bankers Equity Limited
VS
. East West Insurance Company Limited & Others )
Law: Code Of Civil Procedure, 1908.
Section: 7(10), 7(11)
Law: Banking Tribunals Ordinance, 1984
Section: 2(c)
Law: Companies Act, 2017
Section: 509(1)(f), 316/310
Sections Used (Numbers only) Order 7 Rule 10 CPC Order 7 Rule 11 CPC Section 2(c) Banking Tribunals Ordinance, 1984 Section 509(1) Companies Act, 2017 (Proviso clause f) Section 316 Companies Ordinance, 1984 (corresponding Section 310 Companies Act, 2017) Case Summary This case concerns an appeal against the Banking Tribunal’s dismissal of a recovery suit filed by Bankers Equity Limited (BEL) against an insurance company. BEL sought recovery under an insurance guarantee issued for supply of machinery in a financing arrangement. The Tribunal held that the suit was not maintainable because the insurance company did not fall within the definition of “customer” under the Banking Tribunals Ordinance, 1984. The Court examined whether the insurance guarantee constituted “finance” and whether the guarantor could be treated as a “customer” to confer jurisdiction on the Banking Tribunal. It was found that the guarantee was a commercial performance/advance payment guarantee linked to a supply contract, not a banking finance transaction. Therefore, it did not fall within the statutory scope of “finance” under the Ordinance. The Court further held that the Banking Tribunal’s jurisdiction is limited and cannot be extended to ordinary contractual disputes. Since the insurance company was not a customer and the transaction did not qualify as banking finance, the suit was rightly dismissed. The appeal was therefore rejected. 2 Two-Word Case Descriptions Jurisdictional Dismissal Guarantee Interpretation J U D G M E N T The present Appeal arises out of the Order and Decree dated 15.5.1994 (“Impugned Order”) passed by the learned Chairman of the Banking Tribunal-I (“Tribunal”), in Suit No.2138/1993 (Bankers Equity Limited v. East West Insurance Company Limited & Others) (“Banking Suit”) instituted by the Appellant viz. Bankers Equity Limited (“BEL”). On an application filed by Respondent No.1 (“Insurance Company”) under Order 7 Rules 10 and 11 of the Code of Civil Procedure, 1908, the Tribunal through the Impugned Order, held that…