Supreme Court rules banking court cannot award markup not claimed in plaint

The Supreme Court has held that a banking court cannot grant markup that a lender never sought in its original plaint, according to Profit by Pakistan Today. The apex court overturned the February 2019 ruling of the Lahore High Court (LHC) that had let Citibank collect markup under a revised decree. The ruling followed an appeal by Crescent Spinning Mills, which a three-member bench allowed.

The dispute goes back to the 1990s, when the company obtained financial facilities from Citibank and later defaulted on its dues. Citibank lodged a recovery suit worth Rs76 million in 1995, and the bank won a decree in 1999. Citibank then obtained a revised decree adding markup until recovery under the Civil Procedure Code (CPC), a step the LHC upheld on appeal.

Crescent's counsel argued that the trial court had rejected the liquidated damages claim and that the 1984 Ordinance allowed a decree only for relief pleaded in the plaint. Citibank responded that a 1997 law applied when the decree was issued, so markup was recoverable. In an 18-page judgement, the Supreme Court held that the provision could not serve as a route to retry a case or change the parties' core rights, and that any such error needed a review petition or appeal.