Judgment Sheet
IN THE HIGH COURT OF SINDH KARACHI
Second Appeal No. 49 of 2013
Appellant : Muhammad Ashraf,
through Mr. Hussain Shaikh Advocate.
Respondents 1 to 4 : Aslam Parvaiz, Shahid Ahmed,
Shakeel Ahmed and Miss Shabana Begum,
through Mr. Abdul Khalique Advocate.
Dates of hearing : 28.08.2018, 12.09.2018, 27.09.2018 & 31.10.2018.
J U D G M E N T
NADEEM AKHTAR, J. – Suit No.229/2006 for declaration, possession, specific performance, mesne profits and permanent injunction filed by the respondents against the appellant was decreed by the learned trial Court vide judgment and decree dated 15.09.2009 ; and, Civil Appeal No.06/2010 filed by the appellant against the aforesaid judgment and decree was dismissed by the learned appellate Court vide judgment and decree dated 31.01.2013 and 23.02.2013, respectively. This Second Appeal is directed against the above mentioned judgments and decrees passed by the learned trial and appellate Courts.
2. The main questions involved in this appeal are, after holding that the respondents / plaintiffs were liable to pay the entire sale consideration to the appellant / defendant, whether the learned trial Court was justified in decreeing the respondents’ Suit for specific performance of agreement in respect of an immovable property against the appellant ; and, whether the said Suit could be decreed when the original agreement of sale and both the attesting witnesses thereof were admittedly not produced by the respondents in their evidence.
3. Relevant facts of the case are that the above Suit was filed by the respondents against the appellant claiming that vide Agreement to Sell dated 12.06.2004 (‘the agreement’) the appellant had agreed to sell to them residential bungalow constructed on Plot No.90, type A, measuring 200 sq. yds., situated in project known as ‘Billy’s Home’, Survey No.31, Sector 38-A, KDA Scheme No.33, Gulzar-e-Hijri, Karachi (‘the suit property’) in consideration of Rs.2,500,000.00 ; an amount of Rs.250,000.00 was paid by them to the appellant through a cheque dated 31.05.2004 and the balance sale consideration of Rs.2,250,000.00 was to be paid by them after obtaining loan from House Building Finance Corporation (HBFC) ; their application dated 24.07.2004 for loan was accepted by HBFC on 02.08.2004 whereafter they handed over several signed cheques to HBFC ; and, since the appellant was avoiding to perform his agreed part of the contract, they sent to him a legal notice on 24.05.2005 and a reminder on 06.08.2005 which were responded to by the appellant vide his reply dated 09.08.2005 wherein he claimed that the agreement had been cancelled in view of the breach committed by the respondents. In the above background, the above Suit was filed by the respondents with the following prayer :
“a) To pass Judgment and Decree in favour of the plaintiffs and against the defendant.
b) To declare that the plaintiffs are entitled to get transfer (!) the suit property in their names or his choice (!).
c) To declare that the defendant is bound to fulfill all agreed terms and conditions as per Sale Agreement dated 12.06.04.
d) To direct the defendant to execute the sale deed in the name of the plaintiffs or his choice (!).
e) To direct the defendant to hand over the original papers of the suit property.
f) To direct the defendant to hand over the physical possession of the suit property to the plaintiffs.
g) To restrain the defendant not to (!) sell / dispose of or hand over physical possession of the suit property to any other third party.
h) Any other relief / reliefs which this Hon’ble Court may deem fit and proper in the circumstances of the case.
i) Cost of the suit may be awarded.”
4. The Suit was contested by the appellant by filing written statement wherein several preliminary objections were raised regarding its maintainability that it was barred under the Specific Relief Act, 1877, and the Transfer of Property Act, 1882 ; it was not maintainable as it was filed through an attorney ; and, no cause of action had accrued to the respondents for filing the Suit. In addition to the above, the agreement and advance part payment pleaded by the respondents were denied by the appellant in his written statement and it was pleaded by him that the respondents had prepared a sale agreement on which his signatures were obtained by them fraudulently in connivance with his real brother who was a real estate agent and had a grudge against him due to an old family dispute ; the cheque of Rs.250,000.00 alleged by the respondents towards advance part payment was never received by him nor was it ever presented by him for encashment ; the agreement was false and bogus as according to it the respondents had already received original title documents and possession of the suit property, whereas the correct position was that original title documents as well as possession of the suit property were still with the appellant, and the respondents had also prayed in their Suit for recovery of original title documents and possession of the suit property ; and, the agreement never materialized as it was cancelled by the respondents themselves.
5. In view of the pleadings of the parties, following issues were settled by the learned trial Court :
“1. Whether the suit is not maintainable U/S 54 and 56 of Specific Relief Act ?
2. Whether a sale agreement dated 12.06.2004 in respect of suit property bearing No.90 Type A measuring 200 sq. yards, situated at project known as Billy’s Home Survey No.31, Sector 38-A KDA Scheme No.33 Gulzar-e-Hijri Karachi, was executed between the plaintiff and the defendant ? If so its effect ?
3. Whether the plaintiff is entitled to the relief claimed ?
4. What should the decree be ?”
6. In support of their respective cases, the respondents / plaintiffs produced their attorney as their witness and the appellant / defendant himself came into the witness box to testify. After examining the material available on record and hearing the parties, learned trial Court decreed the Suit filed by the respondents as prayed with no order as to costs, and the appeal filed by the appellant was dismissed by the learned appellate Court.
7. It was contended by Mr. Hussain Shaikh, learned counsel for the appellant, that the Suit was decided / decreed by the learned trial Court without deciding the question of its maintainability although a specific issue was framed in this behalf ; the declaration sought by the respondents in respect of the suit property could not be granted to them as they had filed the Suit only on the basis of an alleged sale agreement which was not a title document ; due to this reason, the power-of-attorney of the respondents’ alleged witness was barred under Section 6 of the Transfer of Property Act, 1882 ; there was a serious contradiction between the terms and conditions of the alleged sale agreement and the case set up by the respondents in their plaint as they had prayed therein that possession and original title documents of the suit property should be handed over to them, whereas in the alleged sale agreement it was stated that they had already received possession and original title documents of the suit property ; the above contradiction was admitted by the respondents’ witness in his cross-examination ; the plaint was not signed and/or verified by any of the respondents nor did any one of them come in the witness box ; the documents produced by the respondents’ witness / attorney, including the alleged power-of-attorney in his favour, were not mentioned in the list of documents filed by the respondents after settlement of issues, but the same were still allowed to be produced ; the respondents had not complied with the mandatory provisions of Articles 73, 75 and 79 of the Qanun-e-Shahadat Order, 1984, as the alleged sale agreement and both attesting witnesses thereof were not produced by them in their evidence ; even otherwise, the alleged sale agreement, which ought to have been registered under Section 17 of the Registration Act, 1908, was inadmissible in evidence and could not be relied upon ; it was an admitted position that respondents were not in a position to pay the alleged sale consideration as they had applied to HBFC for loan ; it was also an admitted position that the amount of cheque allegedly paid by the respondents towards advance part payment as well as the loan amount from HBFC were never received by the appellant ; since no sale consideration whatsoever had been passed on to the appellant, the alleged sale agreement was void under Section 25 of the Contract Act, 1872 ; despite the statement made by the respondents’ witness / attorney that they are willing to deposit the entire sale consideration in Court, they never deposited the same ; and, it was held by the learned trial Court itself that the appellant never received any part of alleged sale consideration from the respondents.
8. In support of his above submissions, learned counsel for the appellant placed reliance on (1) Gulzar Khan V/S Mst. Shahzad Bibi and another, PLD 1974 SC 204, (2) Mian Iqbal Mahmood Banday V/S Muhammad Sadiq, PLD 1995 SC 351, (3) Ameer V/S Shahadat, 2005 SCMR 1147, (4) State Life Insurance Corporation of Pakistan and another V/S Javaid Iqbal, 2011 SCMR 1013, (5) Hamood Mehmood V/S Mst. Shabana Ishaque and others, 2017 SCMR 2022, (6) Abdul Hameed Khan V/S Mrs. Saeeda Khalid Kamal Khan and others, PLD 2004 Karachi 17, (7) Khawaja Ammar Husain V/S Muhammad Shabbiruddin Khan, 1987 CLC 1149, (8) Pakistan Industrial Credit and Investment Corporatoin Ltd V/S Habib Enterprises Ltd. and another, 1989 CLC 2070, (9) Muhammad Bashir V/S Haji Muhammad Siddique and 5 others, 1997 CLC 466 and (10) Muhammad Abbas V/S Muhammad Ismail and 2 others, 2017 CLC 1533.
9. On the other hand, Mr. Abdul Khalique, learned counsel for the respondents, contended that the objection regarding non-production of original agreement and its attesting witnesses was never raised by the appellant before any of the lower courts, therefore, he is now estopped from raising such objection in view of Article 114 of the Qanun-e-Shahadat Order, 1984 ; copy of the agreement produced by the respondents was admissible in evidence in view of Articles 74 and 76(b) of the Qanun-e-Shahadat Order, 1984, as the same was allowed to be produced without any objection by the appellant ; the agreement was admitted by the appellant in his written statement, therefore, respondents were not obliged to produce the same as there was no burden on them to prove the same ; and, in view of the appellant’s said admission, the agreement stood proved in terms of Article 113 of the Qanun-e-Shahadat Order, 1984. It was stated by the learned counsel that original agreement could not be produced by the respondents as the same was submitted by them with HBFC along with their application for loan. He, however, conceded that no officer / witness from HBFC was produced or summoned by respondents to confirm this fact or the fact that any cheque was issued or handed over by them to HBFC. It was also conceded that none of the cheques purportedly issued and handed over by respondents to HBFC were encashed. It was further conceded that the cheque handed over by respondents to the appellant towards advance part payment was also not encashed by the appellant. However, it was stated that after fulfilling their obligation by delivering the said cheque to the appellant, respondents could not be held responsible if the appellant had chosen not to encash the same.
10. In support of his submissions, learned counsel for the respondents relied upon (1) Mrs. Mussarat Shaukat Ali V/S Mrs. Safia Khatoon and others, 1994 SCMR 2189, (2) Syed Humayun Zaidi and 4 others V/S Mst. Hussain Afroza, 1999 SCMR 2718, (3) District Council, Sialkot V/S Chaudhry Nazir Ahmed Khan and 2 others, 2001 SCMR 1641, (4) Mst. Rasheeda Begum and others V/S Muhammad Yousaf and others, 2002 SCMR 1089, (5) Muhammad Sadiq V/S Muhammad Ramzan and 8 others, 2002 SCMR 1821, (6) Mst. Amina Bibi V/S Mudassar Aziz, PLD 2003 SC 430, (7) Ameer V/S Shahadat, 2005 SCMR 1147, (8) Dr. Ijaz Ahmed V/S Mst. Nasreen Akhtar and others, 2005 SCMR 1295, (9) Amjad Sharif Qazi and others V/S Salim Ullah Faridi and others, PLD 2006 SC 777, (10) Nazeer Ahmed V/S Maqsood Ahmed, 2008 SCMR 190, (11) Nazir Ahmed and another V/S M. Muzaffar Hussain, 2008 SCMR 1639, (12) Syed Rafiul Qadre Naqvi V/S Syeda Safia Sultana and others, 2009 SCMR 254, (13) Muhammad Ashiq Khan V/S Muhammad Sharif and others, 2016 SCMR 1248, (14) Subhan Allah and 2 others V/S Mst. Maryam and another, 1988 CLC 890, (15) Noor Muhammad and another V/S Muhammad Ishaq and another, 2000 MLD 251, (16) Hussain Ali V/S Shaikh Muhammad Shahid, 2011 CLC 1239, (17) Col. (Retd.) Mir Nawaz V/S Muhammad Haroon & another, SBLR 2017 Sindh 316, and (18) Naseem Akhtar V/S Abdul Rehman Khan, SBLR 2017 Sindh 501.
11. I have heard learned counsel for the parties at length and have carefully examined the material available on record and the law cited at the bar with their able assistance. It was argued by learned counsel for the respondents that the agreement was admitted by the appellant in his written statement, therefore, respondents were not obliged to produce the same in original as there was no burden on them to prove the same and in view of such admission, the agreement stood proved in terms of Article 113 of the Qanun-e-Shahadat Order, 1984. This contention could have been accepted and the principle enunciated in Article 113 ibid would have been applied had there been an unequivocal admission by the appellant in his written statement or evidence. Perusal of the appellant’s written statement shows that in paragraph 1 thereof the agreement and advance part payment alleged by the respondents were denied by him by alleging that the agreement was false and bogus as it was prepared by the respondents who obtained his signatures thereon fraudulently in connivance with his real brother who was a real estate agent and had a grudge against him due to an old family dispute. In his cross-examination, the appellant had denied the suggestion that contents of the agreement were read over to him. In the above circumstances, it cannot be said that there was any unequivocal admission by the appellant in relation to the agreement, and therefore, the burden to prove the agreement and advance part payment in pursuance thereof was on the respondents which was not discharged by them as the original agreement and both the attesting witnesses thereof were admittedly not produced by them. Thus, the principle enunciated in Article 113 ibid was inapplicable in the present case. In order to prove their case, the respondents were required to produce the original agreement as primary evidence in terms of Article 73 of the Qanun-e-Shahadat Order, 1984, as well as both the attesting witnesses thereof as provided in Article 79 of the Qanun-e-Shahadat Order, 1984. In the absence of the above, the Suit filed by the respondents could not be decreed.
12. The following admitted position has emerged from the pleadings of the respondents / plaintiffs, the evidence led by them and the statements made on their behalf before this Court :
A. The cheque handed over by respondents to the appellant towards alleged advance part payment, being 10% of the alleged sale consideration, was not presented or encashed by the appellant as admitted by respondents in paragraph 15 of the plaint ;
B. After issuing and handing over the said cheque and coming to know subsequently that the amount thereof had not been debited from their account, the respondents did not make any other or further attempt to pay the amount of advance part payment to the appellant ;
C. In view of the above, the amount of advance part payment was never received by the appellant ;
D. The 37 cheques purportedly handed over by respondents to HBFC were issued by them in their own names / favour and not in the name of HBFC as stated by them in paragraph 7 of the plaint, meaning thereby that beneficiaries of all the said cheques were respondents and not HBFC ;
E. Assuming that the said 37 cheques were issued by respondents for repayment of the loan, none of the said cheques were encashed, meaning thereby that no installment in respect of the loan was paid by the respondents ;
F. The amount of loan was neither received nor was it repaid by the respondents ;
G. The amount of loan, being the balance 90% of the alleged sale consideration, was never received by the appellant either from the respondents or from HBFC ;
H. Thus, the appellant did not receive any portion / amount of the alleged sale consideration either from the respondents or from HBFC ;
I. Original agreement and/or both attesting witnesses thereof were not produced in evidence by the respondents ;
J. Loan / finance agreement between respondents and HBFC as well as counterfoils of 37 cheques purportedly issued and handed over by respondents to HBFC were also not produced in evidence by the respondents ;
K. No officer / witness from HBFC was produced or summoned by respondents to prove that any loan was sanctioned or disbursed in their favour or they had given any cheque or paid any instalment to HBFC in consideration of such loan ;
L. No bank statement was produced in evidence by the respondents to show any payment either to the appellant or to HBFC ; and
M. It was not the case of the respondents that any portion of the alleged sale consideration was paid by them in cash to the appellant.
13. In view of the admitted position discussed above, which goes to the root of this case in my humble opinion, it is clear that the respondents did not pay any part of the alleged sale consideration to the appellant. In fact, they were admittedly not in a position to pay if not the entire then at least 90% of the alleged sale consideration to the appellant as, according to their own case, they had applied to HBFC for loan equivalent to 90% of the alleged sale consideration, but even this fact or the fact that the amount of loan was actually received or repaid by them could not be proved by them as discussed above. The learned trial Court was fully aware of this most important and crucial fact that the appellant did not receive any part of the alleged sale consideration and the respondents were liable to pay the entire alleged sale consideration to him as it was held in the impugned judgment by the learned trial Court while concluding the findings on Issue No.3 that “Under the circumstances the plaintiffs are liable to make payment of entire sale consideration of Rs.25,00,000/- to the defendant …..”. After coming to this conclusion, there was no justification for decreeing the Suit of the respondents. Needless to say that discretionary relief of specific performance cannot be granted where the party seeking specific performance itself has failed to perform its agreed part of the contract or committed breach thereof.
14. As already held above, the respondents had failed to discharge their burden to prove the agreement. However if it is assumed that there was an agreement between the parties, even then the respondents were not entitled to enforce the same or to seek its performance, and the appellant was not obliged to fulfil any of his obligations thereunder, as the appellant did not receive any part of the alleged sale consideration which has also been held by the learned trial Court, and as such the agreement had become void for lack of consideration. This ground alone was sufficient to decline the relief sought in their Suit by the respondents.
15. There is another important aspect of this case. It was stated by the respondents’ witness in his examination-in-chief that the respondents were willing to pay the balance sale consideration to the appellant. This statement was made on behalf of the respondents by assuming that they were liable to pay only the “balance” sale consideration to the appellant as they had already paid advance part payment to him. However, the fact of the matter was that they were liable to pay the entire sale consideration to the appellant as held by the learned trial Court. Be that as it may, despite the above statement no amount towards sale consideration, whether balance or full, was paid by the respondents and they also did not take any step to deposit the same in Court. In this context, I may refer to a recent pronouncement made by the Hon’ble Supreme Court in the case of Hamood Mehmood V/S Mst. Shabana Ishaque and others, 2017 SCMR 2022. It was held in the above-cited authority that it is mandatory for the person, whether plaintiff or defendant, who seeks enforcement of an agreement under the Specific Relief Act, 1877, that on the first appearance before the Court or on the date of institution of the Suit, they shall apply to the Court for permission to deposit the balance amount, and any contumacious / omission in this regard would entail in dismissal of the Suit or decretal of the Suit, if it is filed by the other side.
16. In Muhammad Feroze and others V/S Muhammad Jammat Ali, 2006 SCMR 1304, it was held by the Hon’ble Supreme Court that jurisdiction of High Court is limited in second appeal to the extent of interference on a question of law and not on facts. After carefully examining all the aspects of this case, I am convinced that both the learned Courts below have failed to appreciate the above important questions of law involved in this matter. Therefore, the impugned judgments and decrees cannot be allowed to remain in the field. Accordingly, the same are hereby set aside and resultantly Suit No.229/2006 filed by the respondents stands dismissed.
This appeal is allowed in the above terms with costs throughout.
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J U D G E