The five-member bench headed by Justice Mamoon Rashid Sheikh and comprising Justice Shahid Waheed, Justice Abid Aziz Sheikh, Justice Jawad Hassan and Justice Asim Hafeez heard the petitions filed by various petitioners challenging reintroduction of Section 15 of Financial Institutions (Recovery of Finances) Ordinance 2001, which empowered banks to sell mortgaged property in case of default in payment by a customer.
The petitioners' counsel submitted that Section 15 of Financial Institutions (Recovery of Finances) Ordinance 2001, had been declared ultra vires of the constitution by the Supreme Court and the LHC through two different judgements but the section was reintroduced in the Ordinance through Financial Institutions (Recovery of Finances) (Amendment) Act 2016 whereas it was not sustainable in the light of said judgements.
They further argued that no property could be sold without determination of default amount whereas evaluators never gave accurate estimate of the property.
The bench heard arguments of the petitioners' counsel at length and directed them for continuing their arguments on the next date of hearing while adjourning the matter till September 30.
Attorney General of Pakistan Anwar Mansoor Khan also appeared before the bench and stated that financial institutions were facing problems and recovery of billions of rupees had been stopped due to the stay order given by the court earlier.
The matter was initially heard in 2016 by then LHC Chief Justice Syed Mansoor Ali Shah who suspended the new section 15.
The LHC CJ had fixed the matter for September 13 after the prime minister had appealed to him for immediately fixing the case, pending since long, while addressing a ceremony in connection with Naya Pakistan Housing Programme on July 31.
He observed that an early decision over the issue would enable the banking sector to extend loan facilities and easing the mortgage process.