IN THE HIGH COURT OF SINDH, KARACHI

Ist Appeal No.134 of 2025

[Amtex Private Limited v. Pakistan Kuwait Investment Company (Pvt) Ltd., & others]

PRESENT:

Mr. Justice Arshad Hussain Khan

Mr. Justice Amjad Ali Sahito .

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Appellant Through Mr. Haris Rashid Khan, Advocate.

Date of hearing 2.04.2026

Date of Decision 22.04.2026

JUDGMENT

ARSHAD HUSSAIN KHAN, J: The present appeal was previously dismissed for non-prosecution on 06.04.2026. Subsequently, the appellant filed CMA No. 446 of 2026 for restoration, alongside CMA No. 447 of 2026 seeking an urgent hearing. Upon due consideration of the grounds set forth in the restoration application, the order dated 06.04.2026 is hereby recalled, and the First Appeal is restored to its original position as that of 06.04.2026. Now we proceed to adjudicate the matter on its merits.

2. The appellant, through the instant First Appeal under Section 22 of the Financial Institutions (Recovery of Finances) Ordinance, 2001 “the FIO, 2001”, has assailed the order dated 25.08.2025 passed by the learned Judge, Banking Court No.I, Karachi, in Execution No.38 of 2020 (Suit No.179 of 2017), whereby it was directed that the rent of ABWA Knowledge Village (Pvt) Limited be attached provisionally till disposal of the application for attachment. The rent was to be deposited by ABWA Knowledge Village (Pvt) Limited with the Nazir of the Banking Court till further orders.

3. The relevant facts of the case are that the appellant, Amtex Private Limited, had been availing financial accommodations from the Respondent No.1, Pakistan Kuwait Investment Company (Pvt) Limited. Upon default, the Respondent No.1 instituted Suit No. 179 of 2017 (Old H.C. Suit No.111 of 2011), which was subsequently decreed in favor of the Respondent No.1 on 01.07.2019 (Decree dated 06.07.2019) for a sum of Rs.73,391,604/- along with cost of funds from the date of default till realization of the decretal amount. To recover this decretal amount, the Respondent No.1 filed Execution Application No. 28 of 2020 (later numbered as Execution No. 38 of 2020), seeking the sale of leased assets. While an auction was attempted, it proved unsuccessful. Thereafter, the appellant assisted the Court and sold the leased assets at forced amount and deposited the Rs.11,500,000/- via cheque. However, a dispute arose regarding the adjustment of this payment, as the appellant alleged that the Respondent No.1 misapplied the funds toward profits and penal markup, rather than diminishing the principal liability.

The matter reached a turning point when an audit report of the Appellant for the year 2024 was placed before the learned Banking Court. The report revealed that the appellant was receiving a rental income of Rs.8,864,000/- from ABWA Knowledge Village (Pvt) Limited and held cash equivalents amounting to Rs.118,252,023/- at the end of year 2024. Conversely, the Respondent's total receivable claim as of 31.07.2021 was Rs.217,176,105/-. In light of these financial disclosures, the learned Judge, Banking Court vide the impugned order dated 25.08.2025, directed the provisional attachment of the rent from ABWA Knowledge Village (Pvt) Limited, ordering it to be deposited with the Nazir of the Court till final disposal of the attachment application.

4. Learned counsel for the appellant argues that the impugned order is erroneous, not sustainable and suffers from material irregularity. It was contended that the Respondent No.1’s application was limited to the attachment of immovable property under Order 21 Rule 54 CPC, and the learned Judge exceeded his jurisdiction by attaching rent, a relief allegedly not prayed for. Counsel further contends that the learned Judge failed to apply judicious mind and came to erroneous conclusion that the appellant hold cash amount equivalent to Rs.118,252,023/- at the end of the year 2024 and failed to understand that the said amount was lying in the books of the appellant only and not in its actual physical possession. He further contends that the Banking Court erroneously classified the appellant as a "willful defaulter" by misinterpreting book entries as physical cash and misallocating payments toward penal markup instead of the principal liability.

5. We have heard learned counsel for the appellant and perused the record carefully and are of the considered opinion that the Banking Court, upon examining the financial disclosures of the appellant, exercised its discretion to attach rental income provisionally. Such discretion is permissible under Section 19 of the FIO, 2001, which empower the Banking Court to adopt measures ensuring effective recovery. The appellant’s contention that the relief exceeded the prayer is misconceived, as execution proceedings are not strictly confined to the wording of the application but to the broader objective of securing satisfaction of the decree.

6. Furthermore, the audit report for 2024 of the appellant clearly reflected substantial rental income and cash equivalents. The appellant’s argument that the cash equivalents were mere book entries without physical possession is unconvincing. In execution proceedings, the court is empowered to consider all realizable assets and income streams of the judgment debtor. The existence of rental income is undisputed, and its attachment is a lawful means to secure the decretal amount and does not constitute a final deprivation of property without due process.

7. In view of the foregoing, the impugned order dated 25.08.2025 passed by the learned Judge, Banking Court No.I, Karachi, does not suffer from any illegality, irregularity, or jurisdictional defect. The provisional attachment of rental income was a lawful and judicious exercise of discretion to secure recovery of the decretal amount. The appellant has failed to establish any ground warranting interference by this Court. Accordingly, the First Appeal stands dismissed, with no order as to costs.

Appeal stands disposed of alongwith all pending applications.

JUDGE

Naveed PA