livelawpk.com - The Lahore High Court has set aside a consolidated judgment

Lahore High Court Remands the case back to the Banking Court for Re-Evaluation and a Fresh Verdict

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Lahore High Court Remands the case back to the Banking Court for Re-Evaluation and a Fresh Verdict

Islamabad 02-07-2024: The Lahore High Court has set aside a consolidated judgment by the Banking Court in case [RFA 1583-2015]. The Court's decision, announced by Mr. Justice Asim Hafeez and Mr. Justice Muhammad Sajid Mehmood Sethi, remands the case back to the Banking Court for re-evaluation and a fresh verdict.

The original judgment, dated 28-07-2015, had decreed a recovery suit filed by Habib Bank Ltd. for Rs. 7,268,401 and dismissed M.L. Traders' counterclaim for damages amounting to Rs. 32,817,314. The case revolved around the terms of a letter of credit issued by the bank, which M.L. Traders alleged had been breached due to unauthorized transshipment of goods.

In their review, the High Court judges highlighted significant lapses in the Banking Court’s judgment, noting the failure to address critical issues such as the enforceability of the bank's obligations under the Uniform Customs and Practice for Documentary Credits (UCP 500) and the implications of non-production of essential documents like the bill of exchange. The High Court found that the Banking Court did not adequately consider whether the terms of the bill of lading were violated and if the exceptions under Article 23 of the UCP 500 applied.

The High Court directed the Banking Court to frame additional issues, allow both parties to present further evidence, and decide the suits afresh without being influenced by previous observations. Consequently, the appeal filed by Habib Bank Ltd. for modification of the original decree became infructuous.

This development underscores the judiciary's commitment to ensuring thorough and fair adjudication, particularly in complex financial disputes involving significant commercial transactions.