Monday 30 April 2012

Bank can not claim mark-up in decree

Citation Name : 2010 CLD 1792 KARACHI-HIGH-COURT-SINDH
Side Appellant : BANK OF KHYBER
Side Opponent : NAZAMUDDIN
Ss. 3, 9 & 10—Suit for recovery of loan–court by consent of the parties appointed a Chartered Accountant to examine the account and submit report regarding outstanding amounts-Chartered Accountants submitted the report that principal amount and amount of mark-up were outstanding against the borrower—Borrower had not denied financial facility given to him by the bank, but all that had been said in his application for leave to defend was that request for such facility was not made by the borrower in his personal capacity, but was extended to his business concern–Borrower, in circumstances, had admitted to have availed the financial facility—In view of absence of denial of the borrower to the extent of availing said facility, oral objection with regard to non-availing of such facility at the time of arguments, was of no legal consequence—Objection of borrower, that whenever a financial facility was rolled-over, mark-up over mark-up had been charged, was a substantial objection—Charging of mark-up after roll-over, would amount to converting a mark-up based facility into interest bearing facility, which was not permissible under Law–Counsel for the Bank conceded that against all facilities provided to the borrower, Bank would not press its claim for mark-up; and sought decree only on the principal amount that had been determined by Chartered Accountant in his report—Suit was decreed accordingly.

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