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

Section: 9

Financial Institutions (Recovery of Finances) Ordinance (XLVI of 2001)---Ss. 9, 10 & 22---Suit for recovery of amount--- Plaintiff--Bank allowed to defendant transport finance facility on mark-up basis and defendant as a security for repayment, of amount executed agreement of Finance whereby he agreed to repay the said amount in instalments and Bank purchased vehicle for the defendant---Defendant made some payment, but then failed to pay instalments according to terms of agreement despite various demands and notices by the Bank and Bank filed suit for recovery of amount against defendant and acquired/repossessed the vehicle---Banking Court having decreed the suit, defendant had filed appeal against and decree of Banking Court---,tank had impounded vehicle in question and officers of Bank had misappropriated the same---Bank, in order to claim amount in respect of vehicle for which finance had been provided, had to return the vehicle impounded, to defendant and or after disposing of said vehicle in accordance with law and adjusting the sale proceeds against outstanding dues, could claim for shortfall---Bank which was neither in a position to return the vehicle impounded nor to adjust value of vehicle misappropriated by its Staff; could not maintain action against defendant-Bank on the contrary was to reimburse defendant for the losses sustained by defendant due to its wrong and illegal acts, but since defendant had not filed counter-claim, same could not be granted. ORDER The appellant filed appeal under section 22 of Financial Institutions (Recovery of Finances) Ordinance, 2001 against the judgment and decree passed by the Banking Court No.1, Karachi, whereby the learned Banking Court decreed the suit for a sum of Rs.334,943 with cost of funds at 8% from the date of judgment till realization. Brief facts of the case are that the respondent filed Suit No.6042 of 2000 in Banking Court No.1, Karachi for recovery of Rs.2,709,454 together with 20% liquidated damages and mark-up at the rate of 15% per annum. In the plaint the respondent alleged that the appellant is the customer/hirer, having its account with the respondent-Bank and applied for transport finance…

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