IN THE SUPREME COURT OF PAKISTAN 
(APPELLATE JURISDICTION) 
 
 
PRESENT: 
MR. JUSTICE GULZAR AHMED 
MR. JUSTICE FAISAL ARAB 
MR. JUSTICE SAJJAD ALI SHAH 
 
CIVIL PETITION NO. 381-K OF 2019 
(Against 
the 
judgment 
dated 
18.03.2019 
passed by the High Court of Sindh, Karachi in 
First Appeal No. 14/2015) 
 
Nazli Hilal Rizvi 
 
…Petitioner(s) 
VERSUS 
Bank Al-Falah Ltd and others 
 
…Respondent(s) 
 
For the petitioner(s): 
Mr. Muhammad Haseeb Jamali, ASC 
Mr. Ghulam Rasool Mangi, AOR 
 
 
For the respondent(1): 
Mr. K.A. Wahab, AOR 
 
 
For the respondent (5): 
Mr. Liaquat Hussain Khan, ASC 
Mr. K.A. Wahab, AOR 
 
 
Date of hearing: 
07.08.2019 
 
JUDGMENT 
 
 
FAISAL 
ARAB, 
J.-Fibercare 
Specialties, 
a 
proprietorship concern of the petitioner’s husband, availed 
financial facilities from the respondent No.1 bank between the 
years 2007 and 2010. This business was being run on property 
situated in Shah Baig Gabool Goth, F.B. Industrial Area,Karachi, 
owned by the petitioner. To secure the finance availed by 
petitioner’s husband, this property was mortgaged with the 
respondent No.1 bank. The last date to retire the debt availed by 
the petitioner’s husband expired on 30.04.2010 on which date a 
sum of Rs.3,972,399.47 was due towards principal amount 
excluding markup. As the business failed to discharge its financial 
obligation within the stipulated time, even after a lapse of about 
ten months of the debt becoming due, the respondent No.1 filed 
CIVIL PETITION NO. 381-K OF 2019 
2
suit in the banking court on 11.02.2011 for recovery of principal 
amount along with markup and cost of funds.  
 
2. 
 
The husband and son of the petitioner were both sued 
as guarantors of the finance provided for the business and she 
herself was sued as mortgagor as well as guarantor. They all 
engaged Mr. Farhan Zia Abrar as their advocate to defend them. 
Leave to defend applications were filed which were dismissed on 
14.11.2012. 
The 
suit 
was 
then 
decreed 
for 
a 
sum 
of 
Rs.4,356,902.58 (Rs.3,972,399.47 being principal amount and 
Rs.384,503.11 towards markup that accrued upto 30.04.2010). 
The decretal amount was to be recovered along-with the applicable 
rate of cost of funds recoverable after the date of default i.e. after 
30.04.2010 till recovery is made. None of the three judgment 
debtors preferred appeal and the judgment and decree passed by 
the Banking Courtattained finality upon expiry of the period of 
limitation.  
 
3. 
 
In order to seek recovery of the decretal amount 
through sale of mortgaged property, the respondent No.1 bank 
moved an application to the Banking Court on 21.10.2013 seeking 
conversion of the suit into execution proceedings as envisaged 
under Section 19 (1) of the Financial Institutions (Recovery of 
Finances) Ordinance, 2001 though such conversion automatically 
takes place under the said Section 19(1) and to that effect it was so 
stated in the judgment passed by the Banking Court. The Banking 
Courtthereafter while proceeding with execution of the decree 
issued notice for attachment of the mortgaged property on 
12.02.2014 which was followed by another notice on 17.04.2014 
for settlement of proclamation of sale after which on 23.05.2014 a 
notice for the sale of mortgaged property was issued. All notices 
were issued at the address on which the judgment debtors were 
initially served. Thereafter, auction notice inviting bids was 
published in leading newspapers i.e. daily Jang and Dawn on 
06.08.2014. Finally, on 11.08.2014 the mortgaged property was 
CIVIL PETITION NO. 381-K OF 2019 
3
sold in auction for a sum of eleven million rupees as against the 
forced sale value assessed at Rs.10.344 million.  
 
4. 
 
After the property was auctioned, the petitioner moved 
an application under Order 21 Rule 90 of Code of Civil Procedure 
on 08.09.2014 seeking to set aside the auction mainly on the 
grounds of want of notice of the execution proceedings and 
incorrect appraisal of the mortgaged property. In the application it 
was claimed that the petitioner was a resident of USA and no 
notice of execution application was served at her US address and 
the property worth twenty-one million rupees, having forced sale 
value of sixteen million rupees was sold for a lesser  amount of 
eleven million rupees. Not convinced with any of the pleas taken by 
the petitioner, the Banking Court dismissed her application 
against which the petitioner preferred appeal in the High Court 
vide impugned judgment which too was dismissed, hence this 
appeal.   
 
5. 
 
Learned counsel for the petitioner argued that the 
petitioner being a permanent resident of USA ought to have been 
served at her USA address but neither any notice of the execution 
proceedings was served upon her nor the value of the mortgaged 
property was properly ascertained nor all the legal requirements 
necessary for the auction were fulfilled, therefore, the sale in 
favour of auction purchaser may be set aside.  
 
6. 
 
As to the argument that proper course for auction of 
the mortgaged property was not adopted, the paper book contains 
copies of notices that were sent in the execution proceedings to the 
petitioner at the address on which she was served when 
summonswas issued in the suit. These notices include notice 
dated 12.02.2014 for attachment of the mortgaged property, notice 
dated 17.04.2014 for settling the terms of proclamation of sale and 
notice dated 23.05.2014 for sale of the mortgaged property. 
Thereafter, auction notice was also published in two leading 
CIVIL PETITION NO. 381-K OF 2019 
4
newspapers i.e. daily Dawn and daily Jang. With regard to the plea 
that no notice of execution proceeding was served upon the 
petitioner at her USA address, the Banking Court in its judgment 
dated 13.02.2011 had referred to Section 19 (1) of the Financial 
Institutions (Recovery of Finances) Ordinance 2001 which provides 
“Upon pronouncement of judgment and decree by a Banking Court, 
the suit shall automatically stand converted into execution 
proceedings without the need to file a separate application and no 
fresh notice need be issued to the judgment-debtor in this 
regard….”. Section 19 (1) has clearly done away with the general 
requirement of instituting fresh proceedings for the execution of 
the decree as provided in the Code of Civil Procedure, hence a clear 
deviation is intended by the legislature from the general procedure 
and envisages that after the banking suit is decreed, the 
proceedings do not come to an end but stand automatically 
converted into execution proceedings for which no fresh notice is 
required to be served. Conscious of the provision of Section 19(1), 
the Banking Court in the last paragraph of its judgment converted 
the suit into execution proceedings and to avoid any ambiguity in 
the minds of the parties also stated that no fresh notice would be 
issued. Henceforth the petitioner and the other co-judgment 
debtors clearly knew from the judgment of the Banking Court 
passed on 13.04.2013 that suit proceedings by operation of law 
stood converted into execution proceedings and no fresh notice 
would be issued.  
 
7. 
 
It is borne out from the record that the petitioner’s 
address in the suit was her residence in Karachi on which the 
summons was served and she also filed her leave to defend the 
said application. It was her obligation to place on record her new 
address for any future service on her, if at all such service was 
required by law, which she did not do. Even otherwise, the 
Banking Court in its judgment dated 13.02.2013 had already put 
the judgment debtors on notice that the suit stands converted into 
execution proceedings under Section 19(1)of the Financial 
Institutions (Recovery of Finances) Ordinance 2001 and no further 
notice would be issued. It is on account of such conversion that 
CIVIL PETITION NO. 381-K OF 2019 
5
the decree holder did not file separate and independent execution 
proceedings but filed an application seeking conversion of suit into 
execution proceedings which had already happened at the time 
when the judgment was passed by the Banking Court. The learned 
judge in the High Court also noticed that the petitioner had herself 
stated in the second recital of the Power of Attorney filed on her 
behalf by her attorney that her advocate had informed her about 
the dismissal of her leave to defend application. Mr. Farhan Zia 
Abrar Advocate who represented the petitioner and other judgment 
debtors in the suit also continued to appear before the Banking 
Court even after conversion of suit into execution proceedings that 
finally culminated in the sale of the mortgaged property.Hence, the 
petitioner 
cannot 
feign 
ignorance 
about 
the 
periodical 
developments taking place in the proceedings.Looking from both 
angles, the question of non-service to the petitioner does not arise 
at all. 
 
8. 
 
From the proceedings of the case it also becomes quite 
apparent that the petitioner, her husband and her son, being the 
co-judgment-debtors had every opportunity to prevent the auction 
of the mortgaged property by coming forward and satisfying the 
decree right from the day when judgment and decree was passed 
by the Banking Court in February, 2013 till the auction notice was 
published in the leading newspapers in June, 2014 yet they chose 
not to. On the contrary they preferred to sit quietly on the sidelines 
under the impression that non-issuance of notice to the petitioner 
at her address in USA, which was never brought on record, would 
vitiate the auction proceeding and they would continue to enjoy the 
decretal amount and interject in the proceedings only when the 
final step in the recovery proceeding was taken. The husband and 
son of the petitioner who were guarantorsof the finance did not 
care to pay the decretal amount in order to avoid auction of the 
mortgaged property. Where the petitioner and the other two co-
judgment debtors accepted their financial liability determined by 
the Banking Court vide judgment dated 13.02.2013 and did not 
prefer appeal then in order to prevent auction of the mortgaged 
property the decree ought to have been satisfied but they failed to 
CIVIL PETITION NO. 381-K OF 2019 
6
do so. On the contrary, they enjoyed the decretal amount right 
from the date of default that occurred way back on 30.04.2010 till 
the property was auctioned on 11.08.2014 (for about four and half 
years) under the false notion that non-issuance of notice of 
execution proceedings at the petitioner’s USA address would be 
sufficient to get the court auction nullified. This becomes quite 
evident from the fact that it was only when the property was sold 
in court auction that the petitioner raised an objection and sought 
nullification of the sale on the pretext of want of notice and wrong 
appraisal of mortgaged property. Both the courts below rightly held 
that no case of want of notice on the petitioner of the execution 
proceedings was made out as in terms of Section 19(1) of the 
Financial Institutions (Recovery of Finances) Ordinance 2001 no 
fresh notice was required for commencement of execution 
proceedings and power of petitioner’s counsel in any case was on 
the record to represent her. 
 
9. 
 
After dismissal of the leave to defend application,the 
judgment debtors ought to have anticipated that judgment and 
decree would be eventually passed for the sale of the mortgaged 
property, which was ultimately passed and was accepted by not 
preferring appeal. In such eventuality the only act that could have 
prevented the sale through auction was payment of the decretal 
amount for which considerable period of time was at their disposal 
i.e. eighteen long months but they failed to do so. The executing 
court, though in terms of Section 19(1) of the Financial Institutions 
(Recovery of Finances) Ordinance 2001 was not legally obliged to 
issue notice of execution proceedings, out of abundant caution had 
issued the same at the petitioner’s address available on record i.e. 
the address on which she was served in the suit and had filed 
leave to defend application through her counsel who continued to 
hold power to represent the judgment debtors throughout 
proceedings. Thus the petitioner and the rest of the judgment 
debtors from their own conduct which they demonstrated right 
from the date when the finance became due on 30.04.2010 till the 
property was auctioned on 11.08.2014 (four and a half long years) 
avoided to fulfill their financial obligation towards the respondent 
CIVIL PETITION NO. 381-K OF 2019 
7
bank and enjoyed its money, without realizing that the auction of 
the mortgaged property in the circumstances was a foregone 
conclusion. In the circumstances, the learned High Court rightly 
did not interfere with the findings of the Banking Court and held 
that the petitioner had notice of the proceedings and inadequacy in 
the valuation of the forced sale value of the mortgaged property, if 
any, is not a valid ground to set-aside a court sale.  
 
10. 
 
In view of what has been discussed above we find no 
justification to interfere with the findings of the learned Single 
Judge of the High Court. We therefore refuse to grant leave and 
dismiss this petition.  
 
 
JUDGE 
 
 
 
JUDGE 
 
 
 
JUDGE 
Karachi, the 
7th of August, 2019 
Approved For Reporting 
Khurram