1999 PLP 834 (CLC)

4. Feeling aggrieved by this judgment and decree, the plaintiff preferred an appeal which was also dismissed with costs by the learned Additional District Judge, Sargodha by means of his judgment, dated 10‑10‑1996.

5. Still dissatisfied, the plaintiff filed this revision petition which was admitted to regular hearing on 3‑10‑1997 in view of the assertion of the learned counsel for the petitioner that any lease money due to the Local Councils could not be recovered as arrears of land revenue but only through a law suit.

6. The learned counsel for the respondents has submitted "cross objections" in writing which were entertained by the office on 16‑11‑1998 under Diary No.20486. The learned counsel for the respondents has, however, submitted that they are in fact his notes which he submitted in the office for the convenience of the Court.

7. This civil revision was in fact admitted to regular hearing in view of what has been laid down in Ali Muhammad & Company v. Municipal Committee, Pasrur through its Chairman and others KLR 1985 Revenue Cases 95 (Lahore) that any lease money due to the Local Councils could not be recovered as arrears of land revenue but only through a law suit. The learned counsel for the respondents, however, urged that since there was no written contract between the parties, it could not be said that the recovery could, only be made through a law suit.

8. It is not denied by the respondents that the petitioner being the highest bidder in an open auction, could collect the Dharat‑fee. The real point in issue, however, was if the respondents' could serve the petitioner with the demand notice, dated 15‑9‑1993 in respect of the arrears of Dharat‑fees liable to be recovered up to 30‑6‑1988 and could resort to the coercive measures under the relevant provisions of law as contained in section 141 read with sections 161 and 162 of the Punjab Local Government Ordinance, 1979. I am sorry that this aspect of the case has not been properly adverted to by the Courts below. .9. Learned counsel for the respondents has referred to a large number of reported cases namely Municipal Committee, Lahore v. Miran Bakhsh Civil Appeal No.2724 of 1926 Lahore Series, Zulaing v. Yamethin District Council 1932 Indian Law Reports 522, Madura Municipality through Commissioner v. K. Alagirisami Naidu AIR 1939 Mad. 957, Dr. Fazal Din v. Municipal Committee, Lyallpur PLD 1956 (W.P.) Lah. 916, Dr. Azeem Shad v. Municipal Committee, Multan PLD 1968 Lah. 1419, Municipal Committee, Bannu v. Munawar Khan, Advocate PLD 1982 Pesh. 61 and Sufi Faiz Ahmad v. Metropolitan Corporation, Lahore and others 1997 CLC

599. I am, however, afraid that these authorities do not help the respondents in claiming that the Town Committee Farooqa needed not file a civil suit for the recovery of the arrears of Dharat‑fee and could seek resort to coercive measures under section 141 read with section 162 of Punjab Local Government Ordinance, 1979. In Municipal Committee, Lahore v. Miran Bakhsh, it was held that although the plaintiff was not entitled to enforce the contract, it could, under section 70 of the Contract Act, claim compensation for the loss which had been caused to it by the use and occupation of the premises by the defendant for the period in question. In Zulaing v. Yamethin District Council, the same view was taken and it was held that although the plaintiff could not sue on his contract which was not in writing, he was entitled to compensation under the provisions of section 70 of the Contract Act for work done, the benefits of which had been accepted by the Council. In AIR 1939 Mad. 957, it was laid down that in a contract of sale found to be unenforceable for want of sanction, vendee unable to restore goods purchased must make compensation. In PLD 1956 (W.P.) Lah. 916, it was held that the true conception of a voidable contract is that it remains in abeyance till the party that has the option exercises it and it then becomes a full‑fledged contract. In PLD 1968 Lah. 1419 where tender had been accepted by the Municipal Committee but no agreement had been recorded in writing in terms of Rule 5 of West Pakistan Municipal Committee (Contract) Rules, 1960, it was held that there was no valid contract and that formalities required by law must be gone through in order to create a binding contract and to attach liability. The same view was taken in PLD 1982 Pesh. 61, and besides. holding that findings of two Courts on any question found to be in utter disregard of mandatory provisions of law could be disturbed by the High Court in second appeal and that the execution of written lease deed in manner prescribed in Rule 5 was not a mere formality but statutory requirement to be complied with to make lease binding. In 1997 CLC 599, it was held that although it could not be disputed that a contract not formalised or executed in accordance with Punjab Local Government Ordinance, 1979 and the rules on the subject, was not binding on the local council as these provisions have been held to be mandatory yet if as a consequence of some arrangement between the parties the Local Council had derived some benefit from the other side, it must compensate him on the principle of "quantum meruit". This view was expressed on the strength of the judgment of Sindh High Court in Ali Muhammad v. Karachi Metropolitan Corporation and another 1985 CLC 1730.

10. It is, thus, clear that in all these cases, the matters had been brought to the Court through law suits and the view‑expressed by the learned counsel for the respondents that where the lease agreement was not reduced into writing, the defendants/respondents were not required under the law to bring a suit against the plaintiff‑petitioner for recovering the arrears of the Dharat‑fee cannot be upheld.

11. In fact, we, can seek assistance from what has been laid down in Haji S. Habibullah and another v. Municipal Committee, Quetta PLD 1977 Quetta 71 referred to in KLR 1985 Revenue Cases 95 (Lahore) in which a large number of earlier cases were considered including AIR 1934 Lah. 699, AIR 1933 Lah. 394, AIR 1938 Nag. 119, AIR 1926 Lah. 518 and AIR 1927 Lah.

161. In Mana Ram's case AIR 1926 Lah. 518, a tonga‑stand in the Town of Chunian was leased out by the Municipal Committee. The Municipal Committee, on the ground that the sum due under that contract or lease had not been paid, took criminal action before the Magistrate under section 81 of the Punjab Municipal Act. The Magistrate directed the recovery of the amount in accordance therewith. Shadi Lai, C.J. observed that the dispute was one between a creditor and a debtor for the recovery of money due under a contract and must be determined by a Civil Court. Similarly, unpaid amount of the lease money was tried to be recovered by following the procedure under section 81 of the Punjab Municipal Act in Maya Das's case AIR 1927 Lah. 161 wherein the tumtum stand of the Town Committee had been leased out and it was held that the amount due was not an amount due under the Act and that it was an amount under a simple lease or contract recoverable only by a law suit. 12 have carefully considered the relevant provisions of law as contained in sections 141, 161 and 162 and also the third schedule to Ordinance No .VI of 1979 and I have no doubt in my mind that coercive measures could not be A adopted to recover the so‑called arrears of Dharat‑fee. A reference to the copies of the pleadings of the parties Annexures "A", "B", "C" and "D" reveals that the plaintiff claimed that he was the contractor with regard to whole sale of vegetable and fruit at the said market and alleged that no body could sell the vegetable or fruit without his permission and that Chairman of the Town Committee issued licences to some people under the political pressure etc. on account of which he could not continue with this business and consequently had to abandon the same. It was in these circumstances that he sought the declaration and mandatory injunction prayed for. In their written statement, the defendants maintained inter alia that the plaintiff had obtained the said lease with regard to collection of Dharat‑fee for a sum of Rs.41,000 and the defendants were well within their rights to claim the suit amount. The question is ' could they do it through coercive measures without recourse to a civil action'. In view of the authorities cited above, it is abundantly clear that the amount in question was neither the arrears of tax, rent nor could the same be said to be payable as other moneys referred to in section 141 nor could it be termed as local rate. A perusal of the third schedule in which as many as 76 offences punishable under section 162 are mentioned also helps in arriving at the conclusion that the plaintiff‑petitioner had committed no 8 offence regarding which a notice (copy Exh.P.l) could be served on him telling him that in case he failed to make the payment of the said amount, he would be liable to pay a fine to the tune of Rs.1,000 or punishment extending to six months or both.

13. The authorities cited at the Bar by the learned counsel for the respondents are not at all relevant for the adjudication of the point in issue and rather of have gathered an impression that the learned counsel for the Town Committee perhaps wants to show that it was entitled to be compensated for the benefits drawn by the plaintiff‑petitioner.

14. For all these reasons, I accept this revision petition, set aside the judgments and decrees of both the Courts below, after setting aside their findings on Issue No. l and hold that the plaintiff had a cause of action to seek declaration and injunction to the effect that the amount in C question could not be recovered as arrears of land revenue and the Town Committee must have resorted to law suit in accordance with law. Findings on Issues Nos.3 to 5 are also set aside being based on faulty approach to the facts of the case resulting in miscarriage of justice. Parties shall, however, bear their own costs throughout. Q.M.H./M.A.K./Z‑68/L Revision allowed.