Banking suit is/can be filed against/by a customer, borrower and/or a financial company for a breach of their financial obligations. These Obligations are listed as under Section 2(e) of The Financial Institutions (Recovery of Finances) Ordinance, 2001. Under Section 7 of the Financial Institution Ordinance 2001, Banking Courts would have all the powers vested in a Civil Court under the Code of Civil Procedure 1908 and at the same time also has all the powers of a criminal court which a Sessions Court possesses under the Criminal Procedure Code. Some of the inherent powers of the Banking Courts include power to recall, examine execution proceedings, powers in auction procedure, power to grant adjournment, interim relief, and extra territorial injunction. A banking court has power to summon witnesses for further cross examination, jurisdiction to determine fraud and misrepresentation and it also has powers to punish anyone who commits contempt of the court or any other offence under the provision of the law.
Section 9 of the financial Institution Ordinance 2001 specifies the procedure of the Banking Courts. Where a customer or a financial institution commits a default in fulfillment of any obligation with regard to any finance the financial institution or as the case maybe, the customer, may institute a suit in the Banking Court by presenting a plaint.
Further, as per Section 7(2) of 1908 in absence of a special procedure, the Banking court can follow the procedure in the CPC.
