IN THE HIGH COURT OF SINDH AT KARACHI
Suit No. 149 of 2007
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Date Order with signature of Judge
1.For hearing of CMA No.484/07.
2.For hearing of CMA No.6515/07.
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PRESENT: MR. JUSTICE KHALID ALI Z. QAZI
Date of Hearing 18.05.2009
Mr. Mirza Sarfraz Ahmed, Advocate for Plaintiff.
Mr. Tahir Mehmood, Advocate for Defendant No.1.
Mr. Asif Ali, Advocate for Defendant No.3.
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Both these applications under Order XXXVIII Rule 5 CPC has been filed on behalf of the plaintiff praying for attachment before judgment of various properties and bank accounts as mentioned in the listed applications.
2. Brief facts of the case requisite for the disposal of these applications are that the plaintiff has filed the suit for recover of Rs.383,386,375, damages of Rs.50,000,000/- and mandatory injunction against the defendants. It has been stated that plaintiff is a respectable business man and enjoying good reputation in the business community. In the month of April 2004 the defendant No.1 through its Chief Executive Haroon Suleman approached the plaintiff and the defendant No.2 to help him in arranging securities worth Rs.380 million to be given to the defendant No.3 for obtaining loan facility from the bank concerning the import of wheat from Australia. Consequently, on 16th April 2004 an agreement was executed by and between the plaintiff and the defendant No.2 with the defendant No1, through Haroon Suleman. It has been further stated that in order to facilitate the defendant No.1, the plaintiff along with the defendant No.2 entered into sale agreement, memorandum of understanding and memorandum of acknowledgement with Ghulam Mohammad Channa of Al-Haider Construction Company and Gabol family through their authorized representative Faiz Usmani. Pursuant to agreement dated 16.4.2004 following properties worth Rs.380 million were mortgaged with the defendant No.3 and necessary memorandum of title deed and other necessary documents were duly signed by Faiz Usmani on behalf of Gabole family and Ghulam Mohammad Channa in favour of the defendant No.3.
i) Property Survey No.66, area 06.02 acres in Deh Gujhro, Sector No.15-A, vide entry No.127 of VF-II, Scheme No.33, Karachi.
ii) Plots of land bearing Survey No.140 and 141 Taluka Latifabad, Hyderabad with construction standing thereon.
iii)
a) 61 residential plots each admeasuring 200 square yards in Block-B,
b) 54 residential plots each admeasuring 150 square yards Block-C,
c) 19 commercial plots each admeasuring 100 square yards in Block-S,
d) 21 commercial plots each admeasuring 166.66 square yards Block-SC,
e) 24 commercial plots each admeasuring 66.66 square yards in Block-LS,
situated in Gulshan-e-Noreen, Deh Halkani, Tapo Manghopir, Karachi.
3. The defendant No.1 filed counter-affidavit to these listed applications and denied the various allegations raised by the plaintiff wherein it has been stated that the defendant No.1 does not owe any payment to the plaintiff and in order to cause harassment to the defendant No.1 to make him succumb to the unjustified demands of the plaintiff through blackmailing. It has been further added that no proof of any alleged past conduct has been given by the plaintiff. The defendant No.1 is a limited company and the relief sought is meant to devastate the defendants before the decision in the suit without any justification. It has also stated that the plaintiff's suit has no chance to be decreed and they want to blackmail the defendants by this application, which is totally groundless and frivolous and as such liable to be dismissed.
4. I have heard Mr. Mirza Sarfraz Ahmed learned counsel for the plaintiff, Mr. Tahir Mehmood learned counsel for the defendant No.1, Mr. Asif Ali learned counsel for defendant No.3 and perused the material available on record.
5. Mr. Mirza Sarfraz Ahmed learned counsel for the plaintiff has contended that the defendant owes a sum of Rs.383,386,375/- to the plaintiff and is also liable to make payment of sum of Rs.50,000,000/- as damages to the plaintiff, but the defendant No.1 with malafide intentions has failed and neglected to make payment of the aforesaid sums of money to the plaintiff despite repeated requests in order to cause wrongful loss to the plaintiff. He has further contended that the defendant No.1 with intent to obstruct/delay the execution of any decree that may be passed against him is about to dispose of the immovable properties which are not owned by the defendant No.1 and close the bank accounts after withdrawing all money in them, which are owned by the defendant No.1 and in this regard the defendant No.1 is negotiating with various persons. He also contended that the past conduct of the defendant No.1 and surrounding circumstances necessitate passing of an order for attaching the properties. He urged that plaintiff claim is just and his apprehensions are reasonable and as such it is just and necessary to secure the interest of the plaintiff by allowing the listed applications. Learned counsel however pointed out that vide order dated 14.2.2007 this Court was pleased to restrain the defendant No.1 from withdrawing amount from his Account No.2364-01, KASB Bank Limited, KDA Scheme No.5, Merchant Centre, Clifton, Karachi, however amount over about Rs.383,386,375 was allowed to be withdrawn. Learned counsel further urged that if the listed applications are not allowed, the plaintiff shall suffer irreparable loss.
6. On the other hand, Mr. Tahir Mehmood learned counsel for the defendant No.1 has reiterated the same grounds as stated in the counter-affidavit. However, he has contended that the plaintiff has filed the application for attachment of properties on the basis of groundless allegations without any proof only in order to blackmail the defendant No.1 in variety of ways. He further contended that the ingredients of Order XXXVIII Rule 5 CPC are not fulfilled in this case because the defendants are a private limited company incorporated in Pakistan and there is no likelihood of their leaving the jurisdiction of this Court, therefore the application for attachment of properties of defendant No.1 before judgment is premature and as such liable to be dismissed with compensatory costs. He has further submitted that plaintiff's claim is based on the sale agreement dated 14.5.2005 which has been expired even otherwise such agreement does not confer any title over properties. In support of his submission, learned counsel has relied upon the cases of MST. RASHEEDA BEGUM & OTHERS vs. MUHAMMAD YOUSAF & OTHERS (2002 SCMR 1089), PAKISTAN CEMENT INDUSTRIED LTD. vs. TEEKAYEF TRADING CO. (PLD 1971 Lahore 522), WEST PAKISTAN TANKS TERMINAL (PVT.) LTD. vs. COLECTOR (APPRAISEMENT) (2007 SCMR 1318) and Lt. MUHAMMAD SOHAIL ANJUM KHAN & OTHERS vs. ABDUL RASHEED KHAN & OTHERS (2003 MLD 1095).
7. Mr. Asif Ali, learned counsel for defendant No.3 states that the defendant No.2 is a proforma defendant.
8. I have given due consideration to the arguments advanced by the learned counsel for the parties and perused the material available on record and also the case law cited on behalf of the defendant.
9. In order to appreciate the submissions of the learned counsel for the parties, Provisions of order XXXVIII, Rule 5, C.P.C. is reproduced as under:-
5. Where a defendant may be called upon to furnish security for production of property.---(1) where at any stage of a suit, the Court is satisfied, by affidavit or otherwise, that the defendant, with intent to obstruct or delay the execution of any decree that may be passed against him---
(a) is about to dispose of the whole or any part of his property, or
(b) is about to remove the whole or any part of his property from the local limits of the jurisdiction of the Court.
the Court may direct the defendant, within a time to be fixed by it, either to furnish security, in such sum as may be specified in the order, to produce and place at the disposal of the Court, when required, the said property or the value of the same or such portion thereof as may be sufficient to satisfy the decree, or to appear and show cause why he should not furnish security.
(2) The plaintiff shall, unless the Court otherwise directs, specify the property required to be attached and the estimated value thereof.
(3) The Court may also in the order direct the conditional attachment of the whole or any portion of the property so specified.
10. From the reading of the above provisions it is clear that a Court if satisfied by an affidavit or otherwise that the defendant with the intent to obstruct or delay the execution of any decree that may be passed against him is about to dispose of the property at any stage of the suit can pass an order under Order XXXVIII Rule 5, C.P.C. In the present case the grounds taken by the plaintiff that the defendant No.1 is about to dispose of the property and withdraw entire amount from their Bank Accounts with intent to obstruct the decree that may be passed in the present suit. The allegations contained in the supporting affidavit of the plaintiff have been denied by the defendant No.1 in their counter affidavit but no rejoinder from the plaintiff's side has been filed. The fact that no specific allegation has been mentioned in the affidavit of plaintiff against the defendant No.1 and that the defendant had not transferred any property to any one prior or after the institution of the suit. From the material available on the record the plaintiff miserable failed to make out prima facie a case to establish the intention of the defendant No.1 to attract the provisions of order XXXVIII, rule 5, C.P.C.
11. The above cases referred by the defendant’s counsel are distinguishable on facts of the present case.
12. In view of the above stated facts and circumstances of the case, I am of the considered opinion that plaintiff’s case does not come within the provisions of Order XXXVIII, Rule 5, C.P.C. therefore the applications being CMA No.484/2007 and 6515/2007 are dismissed with no order as to costs.
Karachi:
Dated:22.05.2009. JUDGE
It has been further stated that defendant No.1 is liable to make payment of following sums of money in terms of agreement dated 16.4.2004:
i) Outstanding amount for the period
16.4.2004 to 15.4.2005 at the rate of
Rs.30 million per annum Rs.18,962,000/-
ii) Outstanding amount for the period
16.4.2005 to 31.12.2006 at the rate of
Rs.30 million per annum Rs.50,000,000/-
Total Rs.68,962,000/-