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Muhammad Ali v Branch Manager National Bank of Pakistan,

CLD 2011 982 · Balochistan High Court

This case involves a bank loan recovery dispute. National Bank of Pakistan sued a principal debtor and two guarantors, including the appellant Muhammad Ali, for recovery of over Rs.12.9 million. When the defendants did not appear despite notices sent through registered post, courier, and publication in two newspapers, the Banking Court in Quetta decided the case ex parte (without the defendants present) and ruled against them on 12 April 2008.

Muhammad Ali later found out about this decree only when he was arrested during execution proceedings on 24 July 2009. He then applied to have the ex parte decree set aside, claiming he was never properly served, that the newspapers used had no circulation in his area, and that the loan documents were fraudulently prepared without his knowledge or signature. The Banking Court rejected his application, and he appealed to the Balochistan High Court.

The High Court upheld the rejection. It found that service by publication in newspapers was valid under the law governing bank recovery cases, and once such service is properly done, no further notice is required. The court noted Ali never denied his address was correct, that process servers had reported attempts to avoid service, and that he waited 21 days after his arrest to file his application without explaining the delay. Finding no evidence of fraud by the bank and no valid excuse for the delay, the court dismissed the appeal, reinforcing that defendants who evade court notices cannot later claim lack of proper service to escape decrees.

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