LAHORE (HRNW) – In a landmark judgment, the Lahore High Court has ruled that a First Information Report (FIR) under Section 489-F of the Pakistan Penal Code (PPC) cannot be registered against checks issued to Microfinance Banks.
The Ruling on Section 489-F
The court clarified that the provisions of Section 489-F, which typically deal with the dishonoring of checks issued for the repayment of loans or fulfillment of obligations, do not apply to loans granted by Microfinance Banks. Consequently, the court has ordered the quashing of the FIR in the case at hand.
Jurisdiction and Legal Recourse
The judgment highlights that under Section 7 of the Financial Institutions (Recovery of Finances) Ordinance (FIO), the Banking Court holds exclusive jurisdiction over such matters. The court maintained that:
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Legal proceedings against a petitioner regarding microfinance loans must be initiated through a formal complaint before the Banking Court as prescribed under the FIO.
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Criminal proceedings under the PPC are not the appropriate legal channel for these specific financial disputes.
Legal Reference: 2026 CLD 303
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