IN THE HIGH COURT OF SINDH AT KARACHI

H.C.A. No.194 OF 2015

[ Muhammad Haroon & another v. Abdul Karim Ayoub & others ]

PRESENT:

            Mr. Justice Arshad Hussain Khan

                                     Mr. Justice Amjad Ali Sahito       

***********

Appellant                               :           Through Chaudhry Abdul Rasheed,

Advocate.

Respondents                         :           Nemo 

Date of hearing                     :           13.05.2026

Date of Judgment                 :           21.05.2026

JUDGMENT  

ARSHAD HUSSAIN KHAN J; This High Court Appeal is directed against the Judgment dated 15.04.2015 and Decree dated 23.04.2015, passed by the learned Single Judge in Suit No. 823 of 2008 whereby the suit was decreed in the following terms :-

“1.       The plaintiff claim of decree to the tune of Rs.35,00,000/- as equivalent to 10% to the market value on the date of filing of the suit Le., 29.05.2008 is accepted. Defendants No.1, 2 and 5 are jointly and severely directed to deposit within one month a sum of Rs.35,00,000/- with 10% simple interest from 13.12.2010, when security was furnished by Defendant No.1, till such deposit in the office of Nazir of this court.

2.         In case of failure of defendants to comply with above orders, the Nazir should forthwith take steps for en-cashing the surety furnished by Defendant No.2 on 13.12.2010 by depositing sublease of office No.4 Bhaijan Gee Area, Karachi, with surety bond No.51615 dated 13.12.2010 and he may proceed to sell the aforementioned surety property for compliance with the above orders.

3.         The Nazir is directed that once he collects the amount of Rs.35,00,000/- alongwith 10% simple interest from November 2010 till the date of realization, he shall call the Plaintiff and all the other co-owners (executants of Exh.P/2) in his office and distribute the said amount amongst them according to their respective share in suit property as per sharia.

4.         The Defendant No.3 has definitely acted in a manner prejudicial to the lawful interest of the Plaintiff who happened to be a bonafide member of the S.M.C.H.Society (Defendant No.3) therefore, Defendant No.3 ought to have protected the interest of the Plaintiff which they have failed. Be that as it may, Defendant No.3 has passed Resolution dated 20.4.2007 for mutation of the suit property in favour of Defendant No.1 without considering the objections of the Plaintiff, the said resolution is hereby declared null and void. The Defendant No.3 is directed to ensure personal attendance of Plaintiff and other co-owners for mutating the suit property in their record in favour of Defendant No.1 after the lawful discharge of encumbrance/lien equivalent to 10% market value with interest as ordered hereinabove by the Defendants jointly and severally. Consequently, in the meanwhile the mutation of suit property in favour of Plaintiff and other co-owners stand restored as mentioned in Exh.14.

5.         Defendant No.3 is restrained from changing and / or making any entry in their record in respect of House No.A-55, SMCH Society Ltd., Karachi in favour of Mr. Fayyaz Ahmed and/or defendant No.2 and 5, unless power of attorney in favour of Mr. Fayyaz Ahmed, and sub-power of attorney in favour of defendant No.2 are both duly stamped to legalize their authority to transfer the suit property through a "registered instrument in accordance with the provisions of Stamp Act, 1899 and the Registration Act 1908. In this regard Defendant No.3 should seek/require a certificate from the "Collector"/Chief Inspector of Stamp as defined by section 2(9) of the Stamp Act, 1899 regarding the payment of "stamp duty" from the beneficiaries of Power of Attorney namely Mr. Fayyaz Ahmed and beneficiary of Sub power of Attorney, Defendant No.2 along with a proper proof of payment of required stamp duty on the said instruments subject to prior "No Objection" from the Plaintiff and co-owners in favor of Defendant No.1 imilarly Defendant No.3 shall not transfer mutate the suit property in favour of Defendant No.5 unless and until the Defendant No.5 gets their sale deed duly stamped in accordance with law which was applicable on the date of execution of sale deed on the immovable property bearing Plot No.A-55, SMCH Society, Karachi with double story building standing threat.

6.         The decree is with no order as to cost.”

2.         The brief facts of the case are that respondent No.1/plaintiff, being one of the legal heirs of [late] Muhammad Ayoub, the original owner of Plot No.A-55, Sindhi Muslim Cooperative Housing Society, Karachi (the subject property), entered into a sale agreement dated 12.03.2004 with Dr. Munawar Hussain. Subsequently, in pursuance thereof, a registered sale deed dated 12.10.2004 was executed in favour of the nominees of said Dr. Munawar Hussain. However, according to the plaintiff, 10% of the sale consideration was withheld by Dr. Munawar Hussain under an undertaking, with the assurance that the same would be paid upon mutation of the property in the record of the Society. The plaintiff alleged that despite execution of the sale deed in favour of defendant No.1, the withheld amount remained unpaid, and thereafter subsequent purchasers and attorneys (the present appellants and respondent No.2), colluded in transferring and constructing upon the subject property without clearing the alleged lien. Consequently, the suit was instituted in the year 2008 seeking recovery of Rs.35,00,000/-, being the alleged difference calculated on the basis of prevailing market value of the property at the relevant time, along with declarations, permanent injunction, and mandatory injunction.

Upon issuance of notices/summons, only the appellants/defendants No.2 and 5, as well as respondent No.4/defendant No.4, filed their respective written statements. Whereas respondents No.2 and 3/defendants No.1 and 3 failed to appear and were subsequently proceeded against ex- parte and debarred from filing written statement, respectively.

The appellants, in their written statement, primarily took the plea that the suit was not maintainable against them and was bad for non-joinder of necessary parties, namely Dr. Munawar Hussain and other co-owners from whom the property had allegedly been purchased. Respondent No.4/defendant No.4, while denying the allegations contained in the plaint, sought dismissal of the suit on the ground that no cause of action had accrued against it and that no governmental interest was involved in the matter. Thereafter, the learned trial Court framed issues arising out of the pleadings, recorded evidence of the parties, and after hearing learned counsel, vide the impugned judgment, decreed the suit in favour of respondent No.1/plaintiff. Being aggrieved thereby, the appellants have impugned the said judgment through the present High Court Appeal.

3.         Learned counsel for the appellants contended that the impugned judgment and decree passed by the learned Single Judge are improper, without jurisdiction, unjust and in variance with law as well as facts of the case. He argued that the suit was time-barred, having been filed more than three years after execution of the sale deed. It was further contended that necessary parties, including Dr. Munawar Hussain and certain co‑owners, were not impleaded, which rendered the suit defective. Counsel submitted that the claim of recovery was based solely on Munawar’s undertaking and therefore enforceable against him, not against the appellants, and that the learned Single Judge erred in treating the unpaid balance as a charge on the property. It was also argued that the plaintiff’s evidence was contradictory and insufficient, and that the decree was without jurisdiction. He also argued that this is a case of non-reading and misreading of the important evidence, as such, the impugned judgment and decree are illegal, null and void and have no legal effects in the eyes of law. He lastly prayed that this appeal may be allowed as prayed for. He has relied upon the case of Akhtar Ali Khan and another v. Settlemnet Commissioner, Peshawar and 4 others [1989 SCMR 506] and Syed Ghulam Sarwar shah v. Federation of Pakistan through Secretary Ministry of Housing and Work, Government of Pakistan, Islamabad, Pakistan and 13 others [2021 CLC 1474].

4.         We have heard learned counsel for the appellants, perused the record carefully with his assistance and perused the material available on record.

Precisely, the case of the appellants primarily rests upon the objections that: (i) the suit was barred by limitation; (ii) the suit suffered from non-joinder of necessary parties, including Dr. Munawar Hussain and certain co-owners; (iii) the alleged liability, if any, exclusively arose out of the undertaking of Dr. Munawar Hussain and, therefore, could not be enforced against the appellants; and (iv) the learned Single Judge erred in treating the alleged unpaid amount as a charge/lien upon the suit property.

5.         Insofar as the objection regarding limitation is concerned, the same appears to be devoid of substance. The record reflects that the plaintiff’s claim was based upon the alleged non-payment of 10% balance sale consideration, which, according to the undertaking (Exh.P/3) relied upon by the respondent No.1/plaintiff, was payable at the time of mutation of the property in the record of the Society. Admittedly, the mutation in favour of defendant No.1/respondent No.2 was effected on 20.04.2007, whereas the suit was instituted in the year 2008. Therefore, prima facie, the suit was filed within the prescribed period of limitation.

6.         As regards the objection pertaining to non-joinder of necessary parties, particularly Dr. Munawar Hussain and certain co-owners, we are of the considered view that the same is also misconceived. The controversy before the learned trial Court primarily revolved around the subsisting liability attached to the suit property on account of the unpaid portion of the sale consideration and the subsequent transactions undertaken in relation thereto. The persons against whom substantive relief was sought and who were directly connected with the subsequent transfer and possession of the property were already before the Court. In such circumstances, absence of any other person did not render the suit incompetent.

7.         Similarly, the contention that the alleged liability could only be enforced against Dr. Munawar Hussain and not against the appellants is without merit. From the record, it appears that respondent No.1 entered into a sale agreement (Exh.P/1) dated 12.03.2004 with Dr. Munawar Hussain, which subsequently culminated into a registered sale deed dated 12.10.2004 (Exh.P/2) executed in favour of the nominees of Dr. Munawar Hussain, namely respondent No.2. Such fact is also evident from the sale deed itself, wherein Dr. Munawar Hussain has signed as a witness and a copy of his C.N.I.C. is appended thereto.

According to respondent No.1/plaintiff, however, 10% of the sale consideration was withheld by Dr. Munawar Hussain under an undertaking (Exh.P/3), with the assurance that the same would be paid upon mutation of the property in the record of the Society. Significantly, appellant No.1, who admittedly acted as sub-attorney of the attorney of respondent No.2, categorically admitted in paragraph 3 of his written statement that the sale agreement dated 12.03.2004 executed between respondent No.1 and Dr. Munawar Hussain was the very transaction which culminated into the sale deed in favour of respondent No.2. In such circumstances, denial of the undertaking relating to payment of the balance sale consideration does not appear plausible. It is also an admitted position that the sale consideration mentioned in the registered sale deed (Exh.P/2) materially differs from the consideration reflected in the original sale agreement (Exh.P/1), and both appellants, in their evidence, acknowledged and confirmed the contents thereof. The transaction, therefore, clearly falls within the category of a sale where the consideration was partly paid and partly promised. It may further be observed that execution of a registered sale deed by itself is not conclusive proof of a completed “sale” within the meaning of Section 54 of the Transfer of Property Act, 1882. The concept of sale under the said provision necessarily contemplates transfer of ownership in exchange for a price paid or promised, or partly paid and partly promised. Thus, notwithstanding execution of the registered sale deed, the transaction could not be treated as fully concluded unless the entire sale consideration had been paid and duly acknowledged by the vendor. Consequently, the unpaid portion of the consideration continued to constitute a subsisting charge/lien upon the suit property in favour of respondent No.1 and the other co-owners to the extent of 10% of the market value thereof. Once the appellants claimed through respondent No.2 and derived their interest in the property through subsequent transactions, they could not claim immunity from the encumbrance attached thereto. It is a settled proposition of law that a transferee cannot acquire a title better than that of his predecessor-in-interest.

8.         The objection that the learned Single Judge erred in treating the unpaid amount as a charge upon the property is likewise unsustainable. The record further reflects that the statement of the respondent No.1 regarding non-payment of 10% of the sale consideration, as pleaded in the plaint, was fully supported and corroborated by the evidence adduced by him during trial. In such circumstances, it can safely be concluded that the transfer in favour of respondent No.2 was not free from the obligation of payment of the remaining 10% balance sale consideration.

It is pertinent to observe that Section 54 of the Transfer of Property Act, 1882 defines a “sale” as a transfer of ownership in exchange for a price paid, promised, or partly paid and partly promised. In the present case, the unpaid amount admittedly formed part of the sale consideration pertaining to the suit property and was required to be paid by the beneficiary of the sale deed dated 12.10.2004. At the very least, the existence of the undertaking and the corresponding liability ought to have been specifically denied by the beneficiary of the transaction, which admittedly was never done. The learned trial Court, after proper appreciation of the oral and documentary evidence, rightly concluded that the unpaid portion of the consideration constituted a continuing charge/lien upon the suit property, recoverable notwithstanding execution of the registered sale deed.

9.         Moreover, the record reflects that respondent No.1/plaintiff’s testimony was corroborated by sale agreement, sale deed, undertaking, notices, and society records. The appellants failed to rebut authenticity of the undertaking or prove payment of the balance. The learned Single Judge rightly exercised jurisdiction, framed issues, recorded evidence, and decreed the suit. No illegality or irregularity is shown.

10.       As regards the case law cited by learned counsel for the appellants, the authorities are distinguishable on facts and do not advance his case. Accordingly, the cited precedents are of no assistance to the appellants.

11.       In view of the foregoing discussion, this Court finds no illegality or infirmity in the impugned Judgment and Decree. Consequently, instant High Court Appeal is hereby dismissed with no order as to costs, and the judgment and decree of the trial court are maintained in its entirety.

JUDGE

JUDGE

Naveed PA