Banking courts lack jurisdiction to entertain tort claims?

LAHORE: A higher appellate forum has set aside a judgment passed by the banking court, ruling that the banking courts lack jurisdiction to entertain claims based on tort. The case involved a customer who had obtained a car finance facility from a bank and later filed a suit against the bank for damages, declaration, and possession.

The bank had repossessed the vehicle due to the customer’s default on repayment obligations. The customer claimed that the repossession was wrongful and caused him mental suffering and loss of reputation.

The banking court had accepted the customer’s claim, but the higher appellate forum allowed the bank’s appeal, holding that the claim was grounded in tort and did not fall within the jurisdiction of the banking court.

It maintained that damages are usually considered under two heads - general or non-pecuniary loss or damages, that is physical injury, pain and suffering, impaired capacity for the enjoyment of life or lessened capacity and special or pecuniary damages that are actual, incidental and direct expense capable of calculation in terms of monetary value, loss in business profit earning or otherwise, in an action for damages either general or special.

In absence of authentic oral and documentary supporting evidence, mere statement of party is not sufficient to establish amount of damages allegedly suffered by him. A person claiming special damages must prove each item of his loss on the basis of evidence. Where a person claims special damages then it is incumbent upon him to show as to under which head of account and how such damages have been sustained. In absence of such proof, special damages cannot be allowed.

The forum further ruled that while the banking court has jurisdiction to entertain claims arising from breaches of contract related to finance facilities, it lacks jurisdiction to entertain tort claims. The court also observed that the customer had failed to provide evidence to support his claim for damages.

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