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

Section: 9

Law: Contract Act (IX of 1872)

Section: 128,127

(a) Financial Institutions (Recovery of Finances) Ordinance (XLVI of 2001)-----S.9---Contract Act (IX of 1872), S.128---Suit for recovery of loan amount by Bank---Guarantor's denial of his liability for non-fulfillment of conditions precedent by Bank for furnishing of Bank guarantee---Validity---Bank Guarantee was executed a week prior to letter written by Secretary of Borrower Company to Bank containing conditions---Such unilateral conditions proposed by Borrower Company were not. accepted by Bank---Bank Guarantee was self contained document in all respects---If at the time of execution of Bank Guarantee, there was any understanding between guarantor or Borrower Company and Bank for implementation of conditions contained in such letter, then nobody had restrained guarantor from incorporating such terms in Bank guarantee---Borrower Company was an independent legal entity, thus, conditions contained in such letter of its Secretary could not form part of guarantee, separately executed by guarantor---Suit was decreed against guarantor in circumstances.Custodian of Enemy Property, Islamabad v. Hoshang M. Dastur and 6 others PLD 1977 Kar. 377; Saudi-Pak Industrial and Agricultural Investment Company (Pvt:) Ltd. v: Messrs Allied Bank of Pakistan and another PLD 2003 SC 215 and Sadar Din v. Mst. Khatoon and others 2004 SCMR 1102 distinguished.(b) Interpretation of documents-------Written contract containing clear and unambiguous terms---Validity---Court would be reluctant to add/edit, modify or vary its terms on basis of any other evidence, oral or documentary, unless such intention of both parties was obvious.(c) Contract Act (IX of 1872)-----S.127---Plea of absence of consideration of guarantee---Purchase of project of Borrower Company by guarantor with all its assets and liabilities---Execution of guarantee by guarantor in favour of Bank in capacity as new Director of Borrower Company---Held; execution of such guarantee was not without consideration.ORDER ANWAR ZAHEER JAMALI, J.---This appeal, under section 22 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 is directed against the judgment and decree dated 16-5-2005, passed by learned…