2010 PLP 334 (SCMR)

SARDAR MUHAMMAD RAZA KHAN, J.

Mst. Gulshan Hamid, after leave of the Court, has filed this appeal against Kh. Abdul Rehman etcetera, from the judgment and decree dated 9-7-1999 passed by a learned Division Bench of Lahore High Court, whereby the appeal of respondents against the judgment dated 31-7-1993 of the learned Trial Court was accepted and suit filed by respondents for specific performance of contract was decreed in Regular First Appeal. Earlier, the learned Trial Court had dismissed the suit with costs.

2. Mst. Gulshan Hamid owned Bungalow No.17 measuring 2.55 acres on Quaid-i-Azam Road Sialkot Cantt. She agreed to sell the bungalow in favour of Kh. Abdul Rehman, Riaz Butt and Kh. Naseem Ejaz for a sum of Rs.11,25,

000. A sum of Rs.1,25,000 was received in advance and the remaining amount of Rs.10,00,000 was to be paid at the time of registration. As the bungalow was situated in Cantonment Area, a No Objection Certificate (NOC) was to be obtained by the vendor from the GHQ, the written intimation whereof was to be given at the earliest to the vendees. Within 15 days from receipt of intimation, the vendees were required to get the sale-deed registered after payment of the amount due. If the vendees failed to do so., the advance money was to be forfeited and the agreement was to be considered as cancelled.

3. To the contrary if the vendor, after giving NOC, failed to get the sale registered, the vendees had a fight to get double the amount of advance money i.e. Rs.2,50,

000. In case the NOC was declined the advance money of Rs.1,25,000 was liable to be returned to the vendees.

4. The record reveals that GHQ had issued NOC on 4-9-1986. For reasons alleged and counter alleged', the transaction could not be materialized and hence the vendees aforementioned brought a suit for specific performance of contract in January, 1987. After framing of issues and the recording of evidence pro and contra, the learned Trial Court/Senior Civil Judge Sialkot dismissed the suit with costs vide judgment dated 31-7-1993, holding that the plaintiffs had failed to perform their part of the contract. Holding this aspect to the contrary, the learned High Court through the impugned judgment set aside the judgment of the Trial Court and granted plaintiffs the decree prayed for. Hence this appeal.

5. We had the opportunity of listening to exhaustive arguments advanced by Mr. Wasim Sajjad learned ASC for the appellant and Mr. Abdul Rehman Ansari and Rana Nasrullah Khan learned ASCs for the respondents. After evaluation of the assertions and counter assertions, it was found that the learned High Court has not properly attended to certain imported aspects of the case. We would thus start from the alleged agreement (Exh.P.3-PP: 130 to 132).

6. A perusal of the deed would indicate that it was signed by the appellant Mst. Gulshan Hamid alone and not by any of the three vendees. As evident from the contents of the deed, it created rights and liabilities on both sides. Had there been an occasion for the owner-lady to bring a suit for specific performance, she would not have succeeded because the vendees had not signed the deed so as to accept any of the liabilities. The circumstances under which the contract is made are such that the present plaintiffs are given an unfair advantage over the defendant. Section.22 of the Specific Relief Act, 1877 clearly provides that in such circumstances, the discretion is not to be exercised in favour of the plaintiffs. For ready reference section 22 (clause-I) is reproduced as follows: "

22. Discretion as to decreeing specific performance.

The jurisdiction to decree specific performance is discretionary, and. the Court is not bound to grant such relief merely because it is lawful to do so; but the discretion of the Court is not arbitrary but sound and reasonable, guided by judicial principles and capable of correction by a Court of appeal. The following are cases in which the Court may properly exercise a discretion not to decree specific performance:

1. Where the circumstances under which the contract is made are such as to give the plaintiff an unfair advantage over the defendant, though there may be no fraud or misrepresentation on the plaintiff's part".

7. This Court in Arif Shah v. Abdul Hakeem Qureshi PLD 1991 SC 905 (e) held that the illustrations, given in S.22 are a few instances where discretion should not be exercised in favour of specific performance. Rather, these, illustrations were held to be not exhaustive and the Courts were at liberty, in the circumstances of each case, to visualize any other circumstances as falling within the purview of S.22 of Specific Relief Act. So far as the case in hand is concerned, it is directly and squarely hit by illustration I of section 22.

8. The evidence shows that the three plaintiffs belonging to Sialkot and having the blessings of local property dealers brought a lady-owner around in such a manner so as to take unfair advantage. They kept themselves immune from any future claim of the opposite party by not signing the deal at all. It is admitted in the evidence that the plaintiffs had tampered with the document. It is admitted in the evidence that the document was executed by the lady at Islamabad. It is surprising to observe that it was attested on 18-6-1986 by an Oath Commissioner at Sialkot, in the absence of the deponent executant. The plaintiffs have, thereby, resorted to forgery as well. We are of the firm view that in the very construction of the agreement, it was not mutually enforceable and hence no decree of specific performance could be granted.

9. In order to avoid all the above circumstances and others, the plaintiffs never appeared in the witness box in order to avoid being cross-examined. Only some attorney was produced and subsequently one of the plaintiffs appeared in rebuttal of evidence. This tells upon the mala fide intention of the plaintiffs. The discretion does not require to be exercised in their favour.

10. For what is to be discussed hereinafter, it is important to reproduce some of the relevant extracts:--

11. Towards the furtherance of the agreement, the first job to be performed by the owner-lady was to obtain an NOC from the GHQ. Secondly, she was to convey in writing the issuance of NOC to the vendees and, thirdly, it was thereafter that the vendees were bound to make remaining payment and to get the sale registered within 15 days. The plaintiffs case is that such information was not furnished in writing and hence they, being not in the knowledge, were not bound by the given limitation of 15 days and also that time in the given agreement was not of the essence of contract.

12. On the other hand, it was claimed by the defendant-appellant that the vendees were well aware of the grant of NOC, that out of the total area 4 Kanals was to be surrendered in favour of the Cantonment authorities/Government but still they did not perform the contract, made no payment of the remaining amount of Rs.10,00,000 and never initiated to get the sale registered. It was further claimed, in the given circumstances, that the time was of the essence of the contract.

13. If one adverts to the agreement, the restriction of registration within 15 days even after the intimation and writing to the vendees, cannot be enforced against the vendees because they never signed the document and are never bound by any of their liabilities. Here it is that the provisions of section 22 of the Specific Relief Act come into play. No judicial mind would be prepared to exercise discretion in favour of such a party who accepted no liability and claimed all the rights.

14. The provisions of furnishing of information about NOC in writing, is placed, for the benefit of the vendees, so that the limitation of 15 days should not start running against them in the absence of their knowledge. Once knowledge is obtained, the limitation of 15 days is for the benefit of the owner who is to receive the amount within that period and thereafter to sign the registration of sale-deed. It is abundantly clear from the evidence of the parties that the vendees had well-high received information about the issuance of NOC. It was thereafter that the lady-owner along with her husband, at the expense of the vendees, visited Sialkot but due to the non-arrangement of sale price or for one reason or the other, the sale could not be materialized. It is also in the evidence that the vendees had been trying to demarcate the to-be-surrendered 4 Kanals in a manner that both the properties fall on the front and not that the Government should take entire 4 'Kanals in the front. All this is indicative of the fact that they had complete knowledge of the issuance of NOC. They did not make payment and failed to get the sale registered within 15 days thereafter. The adjustment on spot, of 4 Kanals was also not an issue relating to the owner because even after the completion of sale, it could have been settled by the vendees with the Government.

15. It is a settled principle of law that, to hold as to where time is of essence of the contract, it is always to be determined from the circumstances of each case and of each contract. If it is simply written that some agreement is to be performed with a certain period, this by itself cannot be considered to be of essence of the contract. But when the non-performance within such period entails upon certain consequences and such consequences are also given in the contract, the time becomes of essence. In the instant case, it was specifically provided that if the contract is not completed within 15 days and balance amount is not paid, the advance money would stand forfeited and above all the contract would stand cancelled. Here the time was, therefore, of the essence of the contract and vendees failed to perform. Rather, from the evidence it appears that they were the ones who caused delay. They first exploited the owner due to the marriage of her son for which she needed money and thereafter they delayed because they could not arrange for the payment of consideration.

16. The so-called agreement itself provided that even if the owner failed to perform the agreement after obtaining NOC, the vendees would receive double the amount of advance money as compensation. When the compensation was already provided and when consequences of non-performance were already determined in the agreement, the party would stand well compensated and the same would be a good ground for refusal of specific performance; all the more, in the peculiar circumstances of the present case.

17. The issuance of NOC by the GHQ is an act of third party which is not impleaded in the instant case the GHQ/Cantonment authorities are neither party to the contract nor to the suit and hence their act or omission remains binding upon the parties. Qureshi Muhammad Anwar v. S.A. Qureshi 1994 CLC 733 and Muhammad Ishaq v. Mst. Sufia Begum 1992 SCMR 1629 can be referred to in this behalf. The crucial aspect of the present dispute is that the GHQ having issued NOC on 4-9-1986 had withdrawn the same on 25-4-1998, only 15 months after the institution of suit. Thus the trial Court or any other Court was not in a position to direct the specific performance 'which could not be materialized, now or ever, without the NOC alluded to in the so-called agreement itself.

18. Last but not the least, it is abundantly clear from record that the vendees had no intention to make payment. They got a pay order on 8-12-1986 from United Bank Limited Sialkot for a sum of Rs.10,00,000 in the name of Mst. Gulshan Hamid. They informed the owner on 13-12-1986 that pay order had been issued but it was intriguing on the part of the vendees that they had already withdrawn such pay order on 10-12-1986. This is indicative of the mala fide intention that by hook or by crook they should get the sale-deed attested by throwing the bait of pay order withdrawn only two days after its issuance.

19. Learned counsel for the respondents relied upon the case' of Barkat Ullah v. Wall Muhammad 1994 SCMR 1737 in support of their arguments that even if the plaintiffs seek alternative remedy in the plaint, the relief of specific' performance cannot be denied. The authority is distinguishable, in that, when we referred to alternate remedy, it was with reference to the agreement where it was specifically provided as a consequence of non-performance. We observed to resort to such remedy,' in the given and attending circumstances of this case irrespective of what the pleadings are. In the present case anti in the wake of the evidence, we are of the view that it were the vendees who had nit performed their part of the agreement. The question as to what are the implications of alternate remedy, is immaterial for the purpose of the instant ease because the conduct of vendees has never remained above board and the very agreement is not materially enforceable.

20. Mst. Amina Bibi v. Mudassar Aziz PLD 2003 SC 430, is also not applicable because the bar placed on transfer of plot of a housing society cannot be equated with the bar related to the NOC to be issued by the GHQ. It may be kept in mind that the real owner of Cantonment property is Federal Government and the ostensible owners on the spot are merely lessees. Learned counsel further relied upon Muhammad Taj v. Arshad Mahmood 2009 SCMR 114, where it is held that the question of time being essence of contract has to be decided with reference to s facts of each case, which are in favour of the appellant, as already determined in the earlier part of this judgment that according to the undertaking in hand, the time was of the essence of the contract. One should never keep out of mind the fact that the disputed one is a huge bungalow measuring 2.55 acres in the heart of Sialkot Cantonment. The price of such property escalates by leaps and bounds and hence no vendee should be allowed to cause unreasonable delay.

21. As a sequel to the above discussion, we hold that the unilateral agreement not signed by the respondents was not mutually enforceable; that, no decree could be granted because of the withdrawal of NOC; that, it were the respondents who mala fidely exploited the situation, tampered with the deed, forged the same through an Oath Commissioner in the absence of executant, failed to perform within 15 days despite the positive knowledge of the NOC and above all were guilty of misrepresentation about the pay order which they had already withdrawn. Resultantly, the appeal is accepted, the impugned judgment dated 9-7-1999 of the learned High Court is set aside and that dated 31-7-1993 of the learned Trial Court is hereby resorted. S.A.K./G-27/S???????????????????????????????????????????????????????????????????????? Appeal accepted.