2011 PLP 2421 (YLR)

SYED SAJJAD HASSAN SHAH, J.

The petitioner Abdul Hafiz impugned herein the judgment and decree passed by learned Additional District Judge-V, D.I. Khan dated 6-10-2010 whereby the appeal filed against the judgment and decree dated 28-4-2010 of learned Civil Judge-VI, D.I.Khan was accepted and suit of the respondent was decreed.

2. Briefly stated, the facts are that respondent-plaintiff tiled a suit for specific performance of an agreement dated 3-2-2001 in respect of the property fully detailed in the heading of the plaint, seeking the enforcement of provision of clause (3) of the agreement ibid which reads as follows:--

3. An exchange transaction was effected between the parties, in pursuance thereof, they had transferred the possession of shops to each other and in this regard, they executed an agreement referred to above. As per clause (3) of the said agreement reproduced above, .the respondent-plaintiff agreed to compensate the petitioner-defendant by transferring the equal area from the area adjacent towards the western side of the disputed shop from the ownership of the respondent-plaintiff. If the area of the shop would be encroached upon by the Indus Highway Department, the petitioner-defendant would make good the loss sustained by the respondent-plaintiff.

4. The petitioner-defendant contested the suit by filing his written statement. Issues were framed. The learned trial Court recorded the evidence of both the parties. After hearing the arguments, suit of the respondent-plaintiff was dismissed. Feeling aggrieved, the respondent-plaintiff filed an appeal which was accepted and the suit of the respondent-plaintiff was decreed. Hence, the instant revision petition by petitioner-defendant.

5. The learned counsel for the petitioner-defendant contended that the learned appellate Court has failed to appreciate the available oral and documentary evidence. He further contended that the petitioner-defendant is not bound to compensate the respondent-plaintiff.

6. As against that, the learned counsel for the respondent-plaintiff contended that the petitioner-defendant under the legal duty to comply with the said condition and if he is not ready to make good the loss sustained by the respondent-plaintiff, then the respondent-plaintiff be handed over the vacant possession of the shop. On this, the learned counsel for the petitioner-defendant candidly replied that the shop has already been transferred by the petitioner-defendant through a sale transaction. He is no more the owner of the said shop, therefore, it cannot be returned as suggested by the learned counsel for the respondent-plaintiff. He further argued that as per provision of law, the petitioner-defendant is bound to specifically perform clause (3) of the agreement.

7. I have considered the submissions of learned counsel for the parties and carefully perused the record.

8. In the instant case the only question raised on behalf of the petitioner-defendant i5 that as to whether in the light of the provision of clause (3) of subject agreement, the petitioner-defendant is bound to perform his part of agreement as the respondent-plaintiff has transferred his shop vide exchange transaction which was reduced into writing on 3-2-2001. The petitioner-defendant deriving the benefit of said exchange transaction sold away the shop which was transferred in his favour through exchange transaction. It is discernible from the perusal of record that the disputed shop is being acquired by the National Highway Authority under the Land Acquisition Act. The respondent-plaintiff is directed by NHA to demolish the shop and remove the superstructure so that the area underneath the shop can be used by the acquiring department. In this regard the 1 respondent-plaintiff has also been paid the cost of superstructure by the acquiring department.

9. There is yet another question which requires consideration that as the disputed shop transferred in favour of respondent-plaintiff went out of his possession as a result of acquisition proceedings, in such eventuality, what would be the remedy open for the respondent-plaintiff? The answer will be that the petitioner-defendant is under his legal duty to indemnify the loss sustained by the respondent-plaintiff. In this regard, the provision contained in' section 124 of the Contract Act, 1872 can safely be relied upon which defines indemnity. For ready reference section 124 is reproduced as under:-- "124. "Contract of indemnity" defined, A contract by which one party promises to save the other from loss caused to him by the conduct of promisor himself, or by the conduct of any other person is called indemnity.

10. In the light of indemnification clause agreed by the parties to the contract, they can seek their remedy under section 125 of the Contract Act which is reproduced as below:-- "

125. Right of indemnity-holder when sued.... The promise in a contract of indemnity, acting within the scope of his authority, is entitled to recover from the promisor:- (1) all damages which he may be compelled to pay in any suit in respect of any matter to which the promise to indemnify applies; (2) all costs which he may be compelled to pay in any such suit if in bringing or defending it, he did not contravene the orders of the promisor, and acted as it would have been prudent for him to act in the absence of any contract of indemnity, or if the promisor authorized him to bring or defend the suit; (3) all sums which he may have paid under the terms of any compromise of any such suit, if the compromise was not contrary to the orders of the promisor, and was one which it would have been prudent for the promisor to make in the absence of any contract of indemnity, or if the promisor authorized him to compromise the suit." It is admitted fact that the petitioner-defendant entered into exchange transaction, resultantly he acquired a shop in -lieu of such transaction, the disputed shop was transferred in favour of the respondent-plaintiff by the petitioner defendant So, the exchange transaction is legal and genuine one. It is an established principle of law that any person receiving consideration or deriving any benefit even under an agreement which is void and not enforceable, is liable to return the benefit which he received or to indemnify, the promise in terms of sections 124 and 125 of the Contract Act. In somewhat similar circumstances, the honourable Supreme Court of Pakistan in case titled Haji Muhammad Shah v. Sher Khan and others (PLD 1994 SC 294) held that:-- "The party sustaining loss in a transaction of' exchange of' land could claim other land of his choice ,front the other party or ask for compensation in cash equivalent to the market value of deficient land. It is not denied by the petitioner that the land which he gave in exchange to the respondent was shamelat-e-deh (in consolidation/partition proceeding) petitioner was found entitled to only three kanal of it in the entire shamelat land, therefore, respondents were deprived of 45 kanals, 3 marlas of land and were left with 3 kanals only which had been given to them. There is, therefore, no substance in the contention of the petitioner that the respondent did not sustain loss." The above referred dictum is not only in consonance with the principle of equity but also in line with the Muslin Law wherein it has been ordained that person suffering any loss on account of act of some other person is in his right to ask for compensation. Another similar provision in context of caveat emptor has been incorporated in Sale of Goods Act, 1930.

11. In the instant case, as stated above, the exchange transaction is a valid one. The petitioner-defendant has enjoyed the sale proceed of the shop as a result of exchange transaction and as per provision of clause (3) of the agreement, he agreed to compensate/indemnify the respondent-plaintiff to the extent of an area for which he is proved to have been deprived of. It was further agreed that the petitioner-defendant would transfer from his adjacent property situated to the western side of the shop in his favour. In view of the above dictum laid down by honourable Supreme Court, the petitioner-defendant is legally bound to compensate the respondent-plaintiff for the loss which he has suffered to the area of his shop caused by compulsory acquisition of the suit property.

12. For the reasons mentioned above, I am of the view that the judgment and decree passed by the learned appellate Court is quite in accordance with law and calls for no interference. The revision petition being without substance is hereby dismissed with no order as to costs. H.B.T./206/P Petition dismissed.