LAHORE, Dec 11: The Supreme Court has dismissed the appeal of a mills against the high court orders to wind up the company for failure to repay a loan advanced to it by the Pakistan Industrial Credit and Investment Corporation (PICIC) in 1964.

The high court had ordered the winding up of the Nilom Nylon Mills Ltd and disposal of its assets for the repayment of the loan on the application filed by PICIC counsel Barrister Syed Zafar Alki Shah.

The company filed an appeal against the high court decision in the Supreme Court.

The counsel submitted that the PICIC had entered into an agreement with the financial institutions of Germany in 1962 for forward lending of Deutch Mark loans to Pakistani companies.

The Nilom Nylon entered into an agreement for DM loan with the PICIC in 1964. The company management, however, became defaulter and did not make repayment of the loan on one pretext or the other.

The mills’ counsel pleaded before the Supreme Court that the company was ready to repay loan in Pakistani rupee in accordance with the exchange rate prevailing at the time of grant of loan in 1964 instead of the present rate of exchange.

The PICIC counsel submitted that the exchange rate prevailing at the time of loan agreement could not be applied on the date of repayment as it was contrary to the terms and conditions of the loan agreement. It was clearly stated in the agreement that the exchange rate for the repayment of loan was the selling rate of Deutch Mark on the date of repayment. — Reporter