P L D 1996 Supreme Court 825 (PLP)

MUHAMMAD BASHIR KHAN JEHANGIRI, J. ‑‑‑ This petition for leave to appeal is directed against the judgment dated 19‑3‑1995 of a learned single Judge of Dera Ismail Khan Bench of Peshawar High Court whereby Civil Revision No,31 of 1993 filed by the respondents was accepted.

2. The facts to be noted are that by virtue of an agreement to sell dated 18‑4‑1977, Muhammad Hayat, predecessor‑in‑interest of respondents Nos. I to 6 and Haji Hussain Bakhsh, predecessor‑in‑interest of respondents Nos. 18 to 21 agreed to sell the disputed shop to the petitioners for a sum of ks.60,000, out of which Rs.500 in cash while Rs.37,000 were paid through cheque dated 2‑4‑1977. The father of the petitioners further agreed to transfer his land measuring 298 Kanals 14 Marlas by mutation in lieu of the balance amount of Rs.27,000 in favour of the respondents who in turn undertook to get the sale‑deed registered in favour of the petitioners failing which Umar Din, petitioner No.6/father of the petitioners, would pay the balance of sale amount to the vendors at the time of registration of the sale‑deed. It appears that apart from the aforesaid recitals, simultaneously a separate agreement to transfer the aforesaid land in lieu of balance amount of Rs.27,000 was executed by Umar Din, petitioner No.6/father of the petitioners in favour of widow, sons and daughters of Muhammad Hayat and one Muhammad Bakhsh, predecessor‑in- interest of respondents Nos.18 to 21 wherein the stipulation contained in the agreement to sell to transfer the land aforesaid in lieu of balance of sale consideration amounting to Rs.27,000 had been reiterated. In case the petitioners failed to transfer the land as aforesaid on payment of balance of Rs. 27,000, the respondents would get the sale‑deed registered in favour of the petitioners. On the respondents' reluctance to abide by the terms of the agreement to sell, the petitioners filed a suit for specific performance or in the alternative for the refund of Rs.45,100 besides the compensation for construction of the disputed shop/improvements brought about therein.

3. The suit was resisted by the respondents, inter alia, pleading that the agreement between petitioner No.6 and the respondents or their predecessor, stood frustrated on account of cancellation of allotment of land in favour of one Badruddin who in his turn had executed a power of attorney for selling the aforesaid land in favour of petitioner No.6. The learned trial Judge found crucial issue as to the entitlement of the petitioners to the specific performance of the agreement to sell against the respondents and decreed the alternative relief to the extent of refund of Rs.37,

500. On appeal, the learned District Judge reversed the aforesaid findings of the teamed trial Court and granted, "a decree for specific performance of the agreement to sell as prayed for". Against the above appellate judgment, the respondents filed a revision petition.

4. The learned Judge in Chamber found the agreement to sell dated 18‑4‑1977 to have been substituted by another "exchange deed" duly executed by Umar Din, petitioner No.6, who had "transferred his landed property in favour of the predecessor‑in‑interest of the petitioners in lieu of the shop in dispute". It was, therefore, concluded that "the previous deed was rescinded by the parties of their own free‑will and accord and as such the contract reflected in the first deed is not enforceable". In support of this proposition, reliance was placed on Banque Indosuez v. Banking Tribunal for Sindh and Balochistan and others 1994 CLC 2272. the ratio whereof is that on the novation of contract, the rights of parties under the original contract stood completely extinguished "giving way to different rights under the subsequent agreement". ' In consequence, the: revision was accepted, the appellate judgment granting the principal relief for specific performance of the agreement to sell was set aside and that of the trial Court was restored.

5. Mr. Muhammad Sardar Khan, learned counsel appearing on behalf of the petitioners, contended that the learned Single Judge in the High Court had erred to hold that the agreement dated 18‑7‑1977 between petitioner No.6 on the one hand and widow, sons and daughters of Muhammad Hayat and Hussain Bakhsh on the other regarding transfer of land by the latter was tantamount to novation of the agreement to sell of the same date between the successors‑in- interest of Muhammad Hayat alongwith Hussain Bakhsh on the one hand and petitioners Nos. 1 to 5 on the other but was reiteration of the recitals in the latter agreement to sell. In this respect, it was pointed out that the plea of novation of agreement to sell was not specifically pleaded and instead it was urged that "exchange deed" had resulted in rescission of the agreement to sell but the learned Judge in Chambers had erred to construe it as "substitution, by the exchange deed".

6. Leave to appeal is granted to consider, inter alia, whether the learned Judge in Chamber had correctly construed the agreement dated 18‑4‑1977 to transfer the land by petitioner No.6 on the one hand and the predecessor‑in interest of the respondents on the other to be novation of the agreement to sell of the same date. A.A/M‑467/S Leave granted.