2022 PLP 939 (MLD)

SHAHID BILAL HASSAN, J.

Succinctly, the appellant instituted a suit for specific performance of agreement to sell by alleging that respondent No.1 being owner of the land measuring 38 kanals 12 marlas entered into an agreement to sell with the appellant for a consideration of Rs.350,000/-. The agreement was reduced into writing on 30.06.1996; earnest money Rs.200,000/- was paid and in this respect an acknowledgment report was executed by the respondent No.1 on the same day i.e. 30.06.1996. The remaining amount was to be paid on 24.12.1997 and the registered sale deed was to be executed. The appellant could not arrange the remaining amount and he got extension of six months from the respondent No.1 which was granted by him and the next date was fixed as 24.06.1998, which was further extended till 24.12.1998. Allegedly, few days prior to 24.12.1998, the appellant approached the respondent No.1 and showed his readiness to pay the remaining amount but the respondent No.1 dilly-dally the matter and upon refusal the appellant instituted the suit. The respondent No.1 appeared and contested the suit and further disclosed that the suit property was sold out to respondent No.2 Shahmand Ali, who was got arrayed by the appellant moving an application under Order I, Rule 10 of the Code of Civil Procedure, 1908. The respondent No.2 appeared and filed his contesting written statement wherein he asserted that he purchased the suit land from the respondent No.1 vide Mutation No.436 dated 08.09.1996, Mutation No.438 dated 08.09.1996, Mutation No.440 dated 30.09.1996 and Mutation No.443 dated 23.11.1996 and contended that he was owner in possession of the suit property from the date of its purchase; that the appellant and respondent No.1 were collusive with each other and that the respondent No.1 had been trying to take possession after sale; that the real brother of respondent No.1 namely Hassan filed a suit for possession on the basis of pre-emption against the respondent No.2. The divergence in the pleadings of the parties was summed up into issues by the learned trial Court and evidence of the parties was recorded. The learned trial Court vide impugned judgment and decree dated 28.07.2009 dismissed suit of the appellant. The appellant being aggrieved of the same preferred an appeal but the learned appellate Court vide impugned judgment and decree dated 26.08.2013 dismissed the appeal; hence, the instant regular second appeal.

2. Perusal of record shows that many a time notice were issued to the respondents but despite personal service they did not bother to appear before the Court and on 08.05.2014 the respondent No.1 was proceeded against ex parte and on refusal to accept the notice by respondent No.2 for 29.09.2021, he was proceeded against ex parte on the said date.

3. Learned counsel for the appellant has been heard and record has been gone through with his able assistance.

4. Undisputed fact is that the appellant entered into agreement to sell dated 30.06.1996 with the respondent No.1. The appellant by producing the marginal witnesses P.W.4 and P.W.5 as well as scribe (P.W.1) has proved the execution of agreement to sell (Ex.P1) and receipt (Ex.P2) with regards to payment of earnest money Rs.200,000/-. Both the learned Courts below are unanimous on this point that the appellant has succeeded in proving that he entered into an agreement to sell (Ex.P1) with the respondent No.1 and when the impugned judgments and decrees are on this score are read together with the evidence of the parties, it appears that this conclusion is based on proper appraisal of evidence on record.

5. The main thrust of the appellant's counsel is on the point that the respondent No.2 was well within knowledge of the agreement to sell (Ex.P1) inter se the appellant and the respondent No.1 and he was not a bona fide purchaser without notice, so the protection under section 27(b) of the Specific Relief Act, 1877 was not available to him, because simple denial was not sufficient to discharge the onus, rather he should have proved good faith and lack of knowledge of earlier agreement after reasonable care. Admittedly, both the parties are residents of the same vicinity as this factum has emerged on record through evidence and well known to one another, so the factum of entering into agreement by the appellant with the respondent No.1 must have been in knowledge of the inhabitants of the village. Had the respondent No.2 made inquiry even in a summary manner, he would have come to know that there exists an agreement inter se the appellant and the respondent No.1, but there is nothing on record to show making of any such exertion on behalf of the respondent No.2. Moreover, the respondent No.2 did not get exhibited four mutations allegedly entered into in his favour so as to prove that the same were sale mutations for value, so the passing of consideration is also not proved on record. In the case of Hafiz Tassaduq Hussain v. Lal Khatoon (PLD 2011 SC 296), it has been invariably held by the Hon'ble Supreme Court that the subsequent vendee has to discharge the initial onus: 1). That he acquired the property for due consideration and thus is a transferee for value, meaning thereby that his purchase is for the price paid to the vendor and not otherwise; 2). There was no dishonesty of purpose or tainted intention to enter into the transaction which shall settle that he acted in good faith or with bona fide; 3). He had no knowledge or notice of the original sale agreement between the plaintiff and the vendor at the time of his transaction with the latter. Moreover, in a recent judgment handed down on 14.10.2021 in Civil Appeal No.389 of 2015 titled Bahar Shah and others v. Manzoor Ahmad the apex Court of the country has held:- '

7. The presupposition of know-how or prior notice of earlier agreement of the same property stem from calculated abstention from an enquiry by the alleged bona fide purchaser. A conscious and purposive circumvention of an enquiry and due diligence which a buyer ought to have made would always communicate a presumption of definite notice. In a position taken as bona fide purchase, it should be established by a fair preponderance of the evidence and the fact of notice may be inferred from the circumstances as well as proved by direct evidence. An honest buyer should at least make some inquiries with the persons having knowledge of the property and also with the neighbors. An equitable interest can be hammered or resisted by a bona fide purchaser for value without notice of the legal interest in the property but it is also significant that Section 27(b) of the Specific Relief Act shields and safeguards the bona fide purchaser in good faith for value without notice of the original contract which is in fact an exception to the general rule. The doctrine of purchaser without notice embodies the maxim that "where equities are equal the law will prevail". Under Section 3 (Interpretation Clause) of Transfer of Property Act 1882, "a person is said to have notice" of a fact when he actually knows that fact, or when, but for willful abstention from an inquiry or search, which he ought to have made, or gross negligence, he would have known it. Explanation II, further expounds that "Any person acquiring any immovable property or any share or interest in any such property shall be deemed to have notice of the title, if any, of any person who is for the time being in actual possession thereof." It is a settled law that where subsequent vendee conducted no inquiry whatsoever with regards to title of the property in question, he would not be deemed to have purchased property in question for value, in good faith and without notice of original contract. As stated above, it has come on record that inhabitants of the village knew about the original contract inter-se the appellant and respondent No.1. Such observation has already been rendered by this Court in Muhammad Sham v. Muhammad Sarwar and others (1997 CLC 1231 Lahore).

6. Pursuant to the above, when it is proved that the appellant entered into agreement to sell with the respondent No.1 and Rs.200,000/- were paid as earnest money where upon agreement to sell (Ex.P1) and receipt (Ex.P2) were executed and no confidence inspiring evidence germane to making of inquiry about the original contract by the respondent No.2 was made as required by law and settled principles, it can safely be concluded that the learned Courts below have failed to appreciate the evidence on record as well as have failed to construe law on the subject in a proper and judicious way. When the position is as such, this Court enjoys ample powers to undo the concurrent findings recorded by the learned Courts below in exercise of jurisdiction under section 100 of the Code of Civil Procedure, 1908.

7. The compendium of the discussion above is that the impugned judgments and decrees are contrary to law and the learned Courts below have failed to determine pivotal issues as referred above while applying independent judicious mind and construing law on the subject in a right way. Resultantly, the impugned judgments and decrees passed by the learned Courts below cannot be allowed to sustain further; as such, the appeal in hand is allowed, impugned judgments and decrees are set aside, consequent whereof the suit of the appellant/plaintiff is decreed as prayed for. The appellant/plaintiff is directed to deposit the remaining sale price with the learned trial Court within 30 days from today, which shall be withdrawn by the respondent No.1, failing which the suit shall be deemed to have been dismissed. No order as to the costs. ZH/M-13/L Appeal allowed.