P L D 1973 Karachi 234 (PLP)

Messrs Arag Ltd. v. Messrs Muhammad Ismail Muhammad Ashraf P L D 1968 Kar. 686 ref. M. A. Pesh Imam for Plaintiff. S. Muhammad Shafi for Defendant. The plaintiff has filed an application for temporary injunction under Order XXXIX, rule 1, C. P. C. read with section 151, C. P. C. seeking a temporary injunction to restrain the defendant from calling fresh tenders for the sale of 230 tons of M. S. scrap iron and/or disposing of the same in any manner. An ad interim injunction was granted and the application has now come up for confirmation of the same. The facts which have given rise to the application for temporary injunction are that the defendant agreed to sell to the plaintiff 1100 tons of imported M. S. scrap iron at the rate of Rs. 1,015 per ton ex‑defendant's godown on "as is where is" basis. The plaintiff agreed to take delivery of the scrap iron in such a way that the entire quantity would be lifted within a period of four months from the date of the contract. The payment was to be made at the agreed rate against delivery of each lot after weighment of each lot had been made at Modern Weigh bridge, Shershah at the cost of the defendant. The plaintiff had deposited with the defendant a sum of Rs. 1,50,000, which was to be treated as deposit to be adjusted towards the cost of the scrap iron at the time of the settlement of account. The terms and conditions of the contract are contained in letter dated 14th January 1972, which was signed by the parties and is Annexure "A" to the plaint. After the plaintiff had taken delivery of about 783 tons, he requested the defendant by letter dated 17th April 1972 to let him pay at the reduced rate of Rs. 515 per ton instead of at the agreed rate of Rs. 1,015 for future deliveries, so that the deposited amount may thereby be adjusted against the price of the remaining quantity of the scrap iron. The defendant replied by letter dated 22nd April 1972, that it could not accede to the plaintiff's request and called upon the plaintiff to make payment in full against all the remaining deliveries of the scrap Iron at the contract rate. It appears that thereafter, the plaintiff continued to pay and take delivery at the rate originally agreed, when the defendant by his letter dated 18th May 1972, Informed the plaintiff that as the plaintiff has failed to lift the entire quantity of the scrap iron within four months, the contract stood cancelled and called upon the plaintiff to collect its deposit of Rs. 1,50,000 lying with the defendant. The defendant also advised the plaintiff that fresh tenders were being invited for disposal of the scrap iron in question for which they would welcome the plaintiff's offer. The defendant, accordingly. returned the deposit of Rs. 1,50,000 to the plaintiff by means of two cheques both dated 31st May 1972. Both cheques were duly encashed by the plaintiff on 2nd and 8th June 1972, respectively. In the circumstances, the plaintiff filed this suit for a declaration that the property in the entire contract goods passed to him and for a decree directing the defendant to deliver to him the remaining balance of 230 toes of scrap iron. He also prayed for a permanent injunction restraining the defendant from calling fresh tenders for the sale of the said balance quantity and/or from disposing of the same in any manner. In the alter native, the plaintiff claimed a decree for damages amounting to Rs. 57,500 against th‑ defendant as loss of profit on the sale of the balance quantity of scrap iron of which he has been deprived. In support of the application, the learned counsel for the plaintiff submitted that the contract was for the sale of imported goods not readily available In the market and was, in effect, an unconditional contract for the sale of specific goods in a deliver able state and that, accordingly, the property in the goods had passed to the plaintiff on 14th January 1972, when the contract was made. In this connection, he referred to section 20 of the Sale of Goods Act, 1930 and P L D 1968 Kar.

686. The learned counsel also submitted that the stipulation as to time for taking delivery was not of the essence of the contract and that, in any case, there was waiver by the defendant who gave some deliveries after 14th May 1972 on which date the contract had allegedly expired. In the circumstances, the cancellation of the contract by the defendant was arbitrary and illegal. He further submitted that unless the injunction is granted the plaintiff would suffer irreparable loss because he has already agreed to sell the contracted goods to a third party and would have to bear substantial loss if the deliveries were not made to him. The learned counsel for the defendant submitted that in ask ing the Court to order delivery of the balance of the unsold scrap iron, the plaintiff in effect, was asking for specific performance of the contract. He submitted that no case for specific performance has been made out since pecuniary compensation would afford adequate relief tO the plaintiff, and that, In fact, the plaintiff has claimed damages in the alternative. He further submitted that the property in the goods had not passed to the plain tiff because the goods had to be sorted out from a larger stock lying in the defendant's godown and a specific quantity had to be weighed after the receipt of the price and then delivered to the plaintiff: He referred to sections 18 and 22 of the Sale of Goods Act, 1930. He also submitted that in com mercial contracts of this nature, time was of the essence and the plaint in failing to lift the entire quantity within four months as agreed, the contract came to an end. This is consistent‑with the fact that plaintiff having taken back his deposit without protest after the alleged expiry of the contract, the parties treated the contract as mutually rescinded. On the question of balance of inconvenience, he submitted that the defendant would suffer more harm by the grant of injunction than the plaintiff if the injunction is refused, because the defendant would be deprived of the unsold goods which on the plaintiff's own admission, are valued at over Rs. 2,33,000, and of which capital the defendant would be deprived of. I have given my best consideration to the respective sub: missions of the learned counsel for the parties and have also considered their respective affidavits. I have come to the conclu sion that the application for injunction should be declined. I have to decide the application on the basis of well established principles of law relating to grant of temporary injunction. These have been succinctly laid down in P L D 1970 S C 139 at p 144 and also in P L D 1969 Kar.

227. These principles are whether firstly the plaintiff has made out a prima facie good case, secondly whether the balance of inconvenience lies in favour of the grant of the injunction and thirdly the plaintiff would `I suffer irreparable loss if the injunction is refused. Bearing in mind that this is an interlocutory application, I must refrain from deciding issues of fact and questions of law submitted by the counsel. I will not prejudge these issues on questions of law which will be for consideration at the trial of the case itself. A decision on these issues now would be deciding the whole suit itself. Applying the principles above‑stated relating to grant of temporary injunction, I find that the plaintiff has not made out prima facie case for what, fn effect, is a decree for specific performance of the contract. I think that damages claimed by the plaintiff in the alternative will afford adequate relief. Also for the same reason, section 34 of the Specific Relief Act, 1877 bars the relief for a permanent injunction. I am also of the opinion that the plaintiff would not suffer irreparable loss if the ad interim injunction is not confirmed. If his case succeeds at the trial, he will be awarded suitable damages. The balance of inconvenience is also on the side of the defendant who will be caused more inconvenience if restrained from disposing of the balance of the goods of which it will be deprived besides causing damage to the goods by determination. I therefore vacate the ad interim Injunction and dismiss this application with costs. S. A. H Application dismissed.