Order Sheet
IN THE HIGH COURT OF SINDH AT KARACHI
Suit No. 127 of 2007
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Date |
Order with signature of Judge |
1. For hearing of CMA No. 1703 / 2007 (U/O-VII R-11 CPC) :
2. For hearing of CMA No. 1039 / 2007 (U/O-XXXIX Rs-1 & 2 CPC) :
3. For examination of parties / settlement of issues :
Plaintiff and his counsel called absent.
Mr. Neel Keshav, advocate for defendants 1 and 2.
Mr. Asadullah Khan holding brief for Mr. Mehfooz Yar Khan, advocate for defendant No.5.
Mr. Ejaz Khattak, advocate for defendant No.6.
Qazi Majid Ali, Assistant Advocate General Sindh.
Date of hearing :30.09.2013.
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NADEEM AKHTAR, J. : This Suit has been filed by the plaintiff against the defendants for declaration, injunction, possession, cancellation of document and damages. The plaintiff has prayed for declarations that he is the 50% owner of Commercial Plot No.117-C, Jami Commercial Street 13, Phase VII, Defence Housing Authority, Karachi, measuring 200 sq. yds., with construction thereon (‘the suit property’) ; defendants 1 to 3 had no authority to sell his 50% share in the suit property to defendant No.4 ; and, conveyance deed in respect of the suit property in favour of defendant No.4 is illegal. He has also prayed for cancellation of registered instruments in respect of the suit property ; namely, the gift deed executed by defendant No.1 in favour of defendant No.2, and the conveyance deed in favour of defendant No.4. He has further prayed that the defendants be restrained from creating third party interest in the suit property. General damages to the tune of Rs.40.000 million have also been claimed by the plaintiff jointly and severally against defendants 1 to 4.
2. C.M.A. No.1703 / 27007 has been filed under Order VII Rule 11 CPC by defendants 1 and 2 for rejection of the plaint, on the grounds that the Suit is barred under Section 11 CPC and the plaintiff had no cause of action for filing this Suit. The record reflects that this application is pending since 28.02.2007, but the learned counsel for the plaintiff has not appeared in this case after 22.10.2007. On 10.12.2012 when this matter came up for hearing of this application as well as for examination of parties and settlement of issues, a request for adjournment was made on behalf of the plaintiff’s counsel, which was strongly opposed by the learned counsel for defendants 1 and 2 due to the above reason. On that date, the matter was adjourned as the last and final chance with a caution that if the plaintiff or his counsel are not present or are unable to proceed with this case on the next date, the pending applications shall be heard and decided in their absence ; and, the plaintiff may make some alternate arrangement in case his counsel is unable to attend this case on the next date. On 30.09.2013 the matter was called twice, but on both occasions the plaintiff and his learned counsel remained absent without any intimation. Accordingly, the learned counsel present on that date were heard in view of the order passed on 10.12.2012.
3. Mr. Neel Keshav, learned counsel for defendants 1 and 2, contended that the dispute alleged in this Suit has been directly and substantially decided in arbitration proceedings between the parties, wherein an Award was rendered by the Sole Arbitrator appointed by the parties by mutual consent through an agreement. He submitted that by virtue of the Award, the Suit property was awarded by the Sole Arbitrator to defendant No.1. He further submitted that the Award was made rule of the Court by the First Class Civil Judge Lahore vide order dated 12.06.2003 with the consent of the parties. The learned counsel referred to the arbitration agreement between the parties, the Award, and the order dated 12.06.2003 whereby the Award was made rule of the Court, copies whereof are annexed to the application for rejection of the plaint. He argued that the subject matter and the dispute which has been alleged in the instant Suit were the same that were directly and substantially decided between the same parties with their consent in the above referred earlier proceedings, and the order passed therein attained finality long ago. It was urged that the present Suit is barred under the principles of res judicata in terms of Section 11 CPC, and therefore, the plaintiff had no cause of action for filing this Suit in respect of the Suit property. It was prayed that the plaint be rejected on these grounds. In support of his submissions, the learned counsel relied upon the cases of (1) Messrs Hasan Ali Rice Export Co. through Sole Proprietor V/S Flame Maritime Ltd. and another, 2004 CLD 334, (2) Muhammad Anwar V/S M/s Associates Trading Co. Ltd. and others, 1989 MLD 4750, and (3) Abdul Karim V/S Haji Ilyas and 4 Others, PLJ 1986 Karachi 328. Learned counsel for the other defendants adopted the arguments advanced by Mr. Neel Keshav advocate, and they also prayed for rejection of the plaint.
4. In order to see as to whether the plaint is liable to be rejected or not, the contents of the plaint, particularly the averments and allegations made therein by the plaintiff, were carefully examined by me. The case of the plaintiff, as averred in the plaint, is that the plaintiff and defendant No.1, who are real brothers, were carrying on business as partners in the name and style of ‘M/S Abdullah Enterprises’, having equal share of 50% each therein. The suit property was purchased for partnership business, and the lease thereof was registered in the joint names of the plaintiff and defendant No.1. A registered revocable power of attorney was executed by the plaintiff in respect of his 50% share in the suit property in favour of defendant No.1. In view of serious dispute between the parties in relation to the accounts of the firm, the plaintiff revoked the said power of attorney, and filed a Suit for dissolution of the partnership and rendition of accounts before the Senior Civil Judge Lahore. Meanwhile, the plaintiff discovered that he was cheated by defendants 1 to 3 as they sold the suit property to defendant No.4 collusively and without his knowledge or consent.
5. It is well-settled that for deciding the question of rejection of the plaint, only the plaint and its accompaniments can be examined. However, in the case of S. M. Shafi Ahmed Zaidi through Legal Heirs V/S Malik Hassan Ali Khan (Moin) through Legal Heirs, 2002 SCMR 338, the Hon’ble Supreme Court was pleased to hold that besides the averments made in the plaint, other material available on record, which on its own strength is legally sufficient to completely refute the claim of the plaintiff, can also be looked into for the purpose of rejection of the plaint.The arbitration agreement dated 20.11.1999 shows that it was executed by the plaintiff, his wife and son ; defendant No.1, his wife and son ; M/S Abdullah Enterprises, the partnership firm of the plaintiff and defendant No.1 ; and, M/S Hassan Tariq Industries (Pvt.) Limited, of which the plaintiff, defendant No.1 and their wives and sons were the directors. A number of businesses and properties, including the suit property, were mentioned in the agreement, and it was stated that the parties to the agreement were the partners and co-owners thereof. Regarding the suit property, it was stated to be owned only by the present plaintiff and defendant No.1 in equal proportions. It was mentioned in the agreement that serious disputes had developed between the parties in relation to the conduct of the business of M/S Abdullah Enterprises, and as such the parties had decided to dissolve the said firm on 31.03.1995. Through the said arbitration agreement, all the parties thereto mutually decided to appoint Mr. Ishfaq Ahmed as the Sole Arbitrator to decide all the disputes mentioned therein. In pursuance of this agreement, the Sole Arbitrator rendered the Award, whereby as many as ten (10) immovable properties were awarded to the present plaintiff, and the remaining five (05) immovable properties, including the suit property, were awarded to the present defendant No.1 and his family members. Vide order passed on 12.06.2003, the Award was made rule of the Court by the First Class Civil Judge, Lahore, by observing that the parties had admitted the Award.
6. In the case of Messrs Hasan Ali Rice Export Co. (supra), it was held by this Court that the principle of res judicata as embodied in Section 11 CPC, is applicable to arbitration proceedings ; where a controversy covered by the arbitration clause was heard and decided, the same controversy between the same parties could not be adjudicated upon by the Court in a suit pending adjudication as it could be hit by res judicata. The Suit in the cited case was dismissed as being barred by res judicata. In Muhammad Anwar (supra), it was held by this Court that applicability of the principle of res judicata was not exclusively restricted to proceedings in Suits and the same as enunciated in Section 11 CPC, could be enforced in proceedings other than Suits to which it does not strictly apply ; the general principle that there should be finality to litigation and further that a person could not be vexed over twice in respect of issue which had already been adjudicated by the Court, could be applied to such proceedings ; and, wherein proceedings under Section 20 of the Arbitration Act, 1940, the question as to the existence of contract was heard and finally decided, the same question between the same parties could not be adjudicated upon by the Court in a subsequent Suit. The plaint in the cited case was rejected as being barred by res judicata.
7. Section 11 CPC specifically bars the Court to try any Suit or issue in which the matter directly or substantially in issue has been directly and substantially in issue in a former suit between the same parties or between parties under whom they or any of them claim, litigating under the same title, in a Court competent to try such subsequent Suit or the Suit in which such issue has been substantially raised, and has been heard and finally decided by such Court. A careful examination of the plaint and the material available on record shows that the dispute in relation to the suit property was finally resolved through the Award which was made rule of the Court with the consent of the parties, whereby the Suit property was awarded to defendant No.1 and his family members ; the Award and the order of the Court were never challenged by the present plaintiff ; and, the matter directly and substantially in issue in the instant suit was directly and substantially in issue in the arbitration proceedings between the plaintiff and defendant No.1. This being the position, and also in view of the above referred cases, the learned counsel for defendants 1 and 2 appears to be correct that the instant Suit is barred under the principle of res judicata. In addition to the above, I am of the view that the Suit is also barred under Section 42 of the Specific Relief Act, 1877, as the plaintiff ceased to have any legal character or right in the suit property when the same was awarded to defendant No.1 through the Award, and the Award was made rule of the Court with the consent of the plaintiff.As such, the plaintiff had no cause of action against any of the defendants in respect of the suit property when this Suit was instituted. In the case of Abdul Nasir and another V/S Haji Saeed Akbar, 2010 SCMR 1770, the Hon’ble Supreme Court was pleased to maintain the order of rejection of the plaint, by holding that no cause of action had arisen in favour of the plaintiff when the Suit was filed.
8. Rule 11 of Order VII CPC provides that the plaint “shall” be rejected in any of the four eventualities mentioned therein, including where from the statements made in the plaint the Suit appears to be barred by any law. In Raja Ali Shan V/S Messrs Essem Hotel Limited and others, 2007 SCMR 741,the Hon’ble Supreme Court was pleased to hold that it is the duty of the Court to reject the plaint if, on a perusal thereof, it appears that the Suit is incompetent ; and, the Court is not only empowered but under an obligation to reject the plaint, even without any application from a party, if the same is hit by any of the clauses mentioned under Rule 11 of Order VII CPC. In Pakistan Agricultural Storage and Services Corporation Ltd. V/S Mian Abdul Latif and others, PLD 2008 Supreme Court 371, it was held by the Hon’ble Supreme Court that the object of Rule 11 of Order VII CPC is primarily to save the parties from rigors of frivolous litigation at the very inception of the proceedings, and if the Court on the basis of averments made in the plaint and documents available, comes to the conclusion that even if all the allegations made in the plaint are proved, the plaintiff would not be entitled to the relief claimed, the Court would be justified in rejecting the plaint in exercise of powers available under Rule 11 of Order VII CPC. In the instant case, neither the main relief of declaration nor the consequential reliefs of cancellation, inunction and damages can be granted to the plaintiff.
9. I have already held that the Suit is barred under Section 11 CPC and Section 42 of the Specific Relief Act, 1877 ; and, the plaintiff had no cause of action against any of the defendants in respect of the suit property when this Suit was instituted. Therefore, the plaint is liable to be rejected.
Foregoing are the reasons of the short order announced by me on 30.09.2013, whereby C.M.A. No.1703/2007 filed by defendants 1 and 2 was allowed and the plaint was rejected with costs of Rs.25,000.00 to defendants 1 and 2 ; and, C.M.A. No. 1039 / 2007 filed by the plaintiff was dismissed as having infructuous.
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