ORDER SHEET

IN THE HIGH COURT OF SINDH, KARACHI

C.P.No.D-500 OF 2015

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Order with signature of Judge

Present

                  Mr. Justice Muhammad Ali Mazhar

                      Mr. Justice Muhammad Iqbal Kalhoro

Muhammad Sauleh                Vs.                           NAB

Date of hearing     14.07.2015

Mr. Khawaja Naveed Ahmed, Advocate for the Petitioner.

Mr.Noor Muhammad Dayo, ADPG NAB.

Khalid Noor I.O of the case

Sohail Ahmed Khan Law Officer Allied Bank Ltd.,

                                                        …..

Muhammad Ali Mazhar J. The petitioner has applied for post arrest bail in NAB Reference No.02 of 2015. The investigation revealed that Prime International was a proprietorship concern owned by Mohammad Izhar-ul-Haq who started business of ship breaking. The firm applied for financing for opening of letter of credit to import a vessel, a bulk oil carrier namely OBO ELIF valuing Rs.165 million for the purpose of scraping.

2. The role of the present petitioner is defined in para-18 of the NAB Reference that he mortgaged the property with Allied Bank against the loan in question but refused to pay the liability by disposing of the property. Hence all the accused persons have been found involved in the willful default as defined under Section 5 of NAO, 1999. It is further stated that accused No.2 Mohammad Naeem entered into voluntary return of loan but defaulted an amount of Rs.105.453 million which was to be paid by selling the property mortgaged by the petitioner. It is also stated in para-9 of the NAB Reference that petitioner although mortgaged the property with Allied Bank against the loan in question but refused to pay the liability by disposing of the property.  

3. The learned counsel for the petitioner at the very outset argued that the language of the NAB Reference do show that petitioner had mortgaged the property which means that original title documents of the property are with the Allied Bank Ltd,.

4. Sohail Ahmed Khan Law Officer, Allied Bank Ltd,. is present he confirms that all original title documents of the mortgage property are in possession/custody of the Bank. The learned counsel further argued that once the property has been mortgaged, the petitioner has no control over it and it is for the bank to sell the mortgaged property but the allegations that the petitioner has failed to dispose of the property is incorrect. If it is presumed that petitioner was required to dispose of the property then the purpose of mortgaging property would become redundant and ineffective.

5. Mr. Noor Mohammad Dayo A.D.P.G NAB on this statement agrees to concede the grant of bail provided the petitioner who has already mortgaged the property will not create any further hindrance in relation to dispose of the property through sale for the purpose of recovery of loan liability for which he stood as guarantor.  

6. At this proposal, learned counsel for the petitioner clearly stated before this court that the bank may sell out the mortgage property and recover the loan liability. Mohammad Haroon son of the petitioner and Azra Sualeh wife of the petitioner both are also present in court. They have also instructed their counsel to give this statement. Learned counsel for the petitioner also pointed out page 259, which is an order passed by the learned Division Bench of this court in C.P No.D-3303 of 2013 which was filed by the same petitioner in which as an interim measure, the officials Respondents were directed to conduct with the petitioner strictly in accordance with law.

7. The I.O has also produced copy of Memorandum of Deposit of Title deeds whereby the petitioner created  equitable mortgage as guarantor in relation to four acres land, survey No.539, Deh Mehran Tappo Malir for securing the payment of dues/loan of M/s Prime International. I.O has also produced the copy of Indenture of lease of the above land. According to the definition  provided under  Section 2 (c) of the Financial Institutions (Recovery of Finances) Ordinance, 2001, the customer means a person to whom finance has been extended by a financial institution and includes a person on whose behalf a guarantee or letter of credit has been issued by financial institution as well as a surety or an indemnifier while Section 128 of the Contract Act provides that the liability of the surety is co-extensive with that of the principal debtor, unless it is otherwise provided by the contract. The examination of record reveals that the petitioner as guarantor, mortgaged his property and it was for the bank to initiate the action in accordance with the law for the recovery against the principal debtor and the guarantor. To a question whether any suit or banking suit is pending, the answer was received in negative.  

8. Since the petitioner’s counsel is agreed that the bank may sell out the property which is mortgaged with them and learned A.D.P.G NAB also conceded to his no objection on this firm statement, therefore, the petitioner is granted bail in NAB Reference No.2/2015 subject to furnishing solvent surety in the sum of Rs.500,000/- (rupees five lac) with P.R bond in the like amount to the satisfaction of Nazir of this Court. The petitioner shall also deposit the original valid passport with the Nazir of this Court and shall not leave the country without permission of the trial court. The petition is disposed of.  The bank may initiate the proceedings for selling the mortgaged property as stated by the counsel for the petitioner in accordance with law. The petition is disposed of.

JUDGE

JUDGE