Supreme Court Rules Banks Cannot Claim Unclaimed Markup

Meanwhile, the Supreme Court has ruled that a banking court cannot award markup that was not specifically asserted in the original plaint, setting aside a Lahore High Court ruling that allowed Citibank to recover further markup through an amended decree.

Key points

• When Crescent Spinning Mills obtained financing from Citibank but failed to repay its dues, the case dates back to the 1990s.
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• Any such error must instead be challenged through a review petition or appeal.
• The bank had not specifically sought the markup that was afterwards went on to the decree.

Notably, a three member bench led by Justice Muhammad Ali Mazhar held that Section 152 of the Civil Procedure Code cannot be applied to add unclaimed relief or change the substantive rights of the parties. Any such error must instead be challenged through a review petition or appeal.

When Crescent Spinning Mills obtained financing from Citibank but failed to repay its dues, the case dates back to the 1990s. Citibank filed a Rs. 76 million recovery suit in 1995. It was decreed in its favor in 1999. The bank afterwards secured an amendment to the decree to include markup until recovery. ADB Announces $200 Million More Loan to Modernize Pakistan's Revenue Administration.

According to The Supreme Court, citibank's original claim sought the principal amount and liquidated damages at 19 percent annually, but the trial court had rejected the liquidated damages claim. The bank had not specifically sought the markup that was afterwards went on to the decree.

As such relief may be treated as abandoned under Order II, Rule 2 of the CPC, the court remarked a court generally cannot grant relief that was not maintained in the plaint. A general request for "any other relief" does not by itself justify granting an unclaimed remedy.

In practice, the Supreme Court converted the petition into an appeal and allowed it, setting aside the Lahore High Court judgment and the banking court's order to the extent that they permitted the extra markup through the amended decree. Stay Connected with ProPakistani.

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Taken together, the developments around supreme Court Rules Banks Cannot Claim Unclaimed Markup point to a situation that is still moving, and the coming days should bring more clarity.