2020 PLP 1571 (MLD)

YOUSUF ALI SAYEED, J.

In terms of this Suit the Plaintiff asserts a right as against the Defendant in respect of a plot of land bearing Plot No.M-41, Zulfiquar Street No.1, Phase-VIII, Defence Housing Authority, Karachi, measuring 10,000 square yards (hereinafter referred to as the "Suit Property", stemming from an allotment said to have been made by the Executive Board of the Defendant, and prays for judgment and decree as follows (Sic): (i) A declaration that the Plaintiffs are lawful and bona fide owners of a Plot bearing No.M-41, Zulfiquar Street No.1, Phase-VIII, Defence Housing Authority. Karachi, measuring 10,000 square yards and that the change or alteration or substitution in the location of the suit property on the plea of Master Plan is illegal, un-authorized, unjustified, mala fide and of no consequence. (ii) Be declared that the imposition of Additional Development Charges by the Defendant Authority is illegal, unauthorized, mala fide and for the purpose of depriving the Plaintiff of its fundamental rights. (iii) Mandatory injunction directing the defondant Authority to deliver/hand over peaceful, vacant and physical possession of the afore-stated immovable property to the plaintiff and thereafter to execute Licence "A" in favour of the Plaintiff. (iv) Prohibitory injunction restraining defendants, its functionaries, employees, officers, servants, agents, representatives, attorneys and/or any other person(s) acting under their control or guidance from cancelling, revoking or recalling the allotment letter dated 11-3-1997 (Annexure K-2) (v) Any other or additional relief, this Hon'ble Court may deem fit and proper in the circumstances of the case. (vi) Cost of the suit.

2. The case, as set up in the plaint, is that the Suit Property, being on the waterfront and hence being one amongst only a handful of properties in the metropolis suitable for the establishment of a Marina Club, was allotted to the Plaintiff by the Defendant for that very purpose in terms of a letter dated 18.06.1991, and that the terms and conditions underpinning such allotment were subsequently communicated to the Plaintiff under cover of a letter dated 13.11.1991, following which a formal Allotment Order dated 11.03.1997 was issued wherein it was categorically stated that the allotment had been approved by the Executive Board of the Defendant in its meeting held on 18.06.1991, and the only condition stated was as to the Defendant's right to recover dues in relation to an increase in development charges. However, despite clearance of the allotment and development charges, physical possession of the Suit Property was not delivered to the Plaintiff, and was held in abeyance on the pretext of outstanding additional development charges coupled with the threat of cancellation in the event of non-payment. Thereafter, on 28.08.2006, the Plaintiff was verbally intimated that the allotment in favour of the Plaintiff stood cancelled, without any formal proceedings having ensued so as to afford the Plaintiff an opportunity of showing cause against such impending cancellation, hence the instant Suit. wherein an ad-interim Order was made in favour of the Plaintiff on 21.09.2006, as confirmed on 07.12.2010.

3. The Defendant, for its part, whilst raising somewhat contradictory pleas in its written statement, nonetheless admitted the factum of allotment in favour of the Plaintiff, but pleaded that since the Suit Property was designated as an amenity plot, the same could not have been allotted to a private party, hence the cancellation of said allotment, in lieu of which an alternate plot of 3000 square yards, albeit commercial as a matter of classification for zoning purposes, was offered.

4. In this backdrop, on 07.12.2010, issues were framed as follows:

1. Whether the suit is maintainable under the law? 2, Whether the interim order passed by this Court has been violated by the defendant? If yes what is the effect?

3. Whether the Suit Plot is an amenity Plot? If so, whether the Defendant is competent to transfer the same to any other Person?

4. Whether the suit is maintainable without joining the necessary parties i.e. Military Estate Office (M.E.O) and Government of Pakistan?

5. Whether the Plaintiff has committed any violation of the Allotment letter dated 18.6.1991 (Annexure "E01" to the plaint) if so its effect? 6, Whether the defendant is estopped in law and equity from disowning the allotment of the suit property?

7. Whether the defendant is legally competent to change/alter/ substitute the location of the suit property?

8. Whether the defendant is legally competent to levy/impose further additional development changes regarding suit property?

9. Whether the Plaintiff is entitled for the vacant physical possession of the suit property?

10. What relief the plaintiff is entitled for?

11. What should the decree be?

5. During the course of proceedings on commission, the Affidavit-in-Evidence of one Sultan Ali Lakhani was filed on behalf of the Plaintiff, and his deposition and cross-examination on oath were duly recorded. However, despite opportunity being afforded over the course of several dates, no evidence was then forthcoming on the part of thc Defendant, and its side was closed accordingly.

6. The Plaintiff's witness produced his Affidavit-in-Evidence as Ex.P/1, Certificate of Incorporation of the Plaintiff Company as Ex.P/1, Resolution dated 21.4.2005 as Ex.P/2, Memorandum and Articles of Association of the Plaintiff Company as Ex.P/3, Extract of Resolution passed by the Board of Directors of the Plaintiff Company dated 07.04.1991 as Ex.P/4, Allotment letter dated 18.6.1991 issued by the Defendant as Ex.P/5, Site Plan of the suit property issued by the Defendant as Ex.P/6, copy of the letter dated 20.06.1991 addressed to the Defendant by the Plaintiff as Ex.P/7, copy of a letter dated 09.06.1992 regarding dues in respect of the Suit Property as Ex.P/8, the statement of account dated 09.06.1992 in respect of the position of dues as on that date as Ex.P/9, letter dated 13.11.1991 addressed by the Defendant to the Plaintiff on the subject of the Terms and Conditions for the Marina Club at the Suit Property as Ex.P/10, the said Terms and Conditions bearing file No. DHA/P&D/107/Marina as Ex.P/11, letter dated 30.12.1992 addressed by the Defendant to the Plaintiff on subject of certain outstanding dues as Ex.P.12, the letter dated 31.12.1991 addressed by the Defendant to the Plaintiff as to its application for Category "B" Membership as Ex.P/l3, copy of the letter dated 28.12.1992 addressed on behalf of the Plaintiff to the Defendant regarding settlement of outstanding installments up to 18.09.1992 as Ex.P/14 along with Pay Order of NBP bearing No.H-327721 amounting to Rs.375,000/- dated 26.12.1992 and Pay order No.H-327602 amounting to Rs.1,532,100/- dated 8.11.1992 along with pay order slip bearing the same number and issuance date as Ex: P/15, a letter dated 28.6.1997 addressed by the Defendant on the subject of issuance of Certified True Copy of the Allotment Order as Ex.P/16, receipts dated 09.03.1995, 03.08.1996, 28.12.1992 and 10.11.1992 issued by the Defendant to the Plaintiff for payments of Rs.1,691,328/-, Rs.721,748/-, Rs.375,000/- and Rs.1,532,100/- in respect of the Suit Property as Ex. P/17, Ex.P/18, Ex. P/31 and Ex. P/32 respectively, a copy of the Plaintiff's letter dated 31.10.1996 mentioning the clearance of all dues, and requesting issuance of an Allotment Letter as Ex. P/19, the formal Allotment Order dated 11.3.1997 as Ex. P/20, correspondence inter se the parties on the subject if additional development charges as Ex. P/21 to Ex. P/25. copy of the letter dated 27.5.2003 issued by the Assistant Director General (Lands), Ministry of Defense, Government of Pakistan pertaining to regularization of allotment of public amenity plots allotted by DHA Karachi upon obtaining the current market value as Ex. P/28, letter dated 19.01.2004 also addressed by the Assistant Director General (Lands), Ministry of Defense, Government of Pakistan, pertaining to regularization of public amenity plots allotted by DHA Karachi as Ex.P/29, and a statement of account dated 30.11.1992 issued by the Defendant reflecting receipt of an amount of Rs.4,032,100/- as on that date as Ex. P/33. The documents produced in original were seen and returned and photocopies thereof were marked and placed on record.

7. Learned counsel for the Plaintiff submitted that the factum of allotment in favour of the Plaintiff in terms of the documents filed along with the plaint and subsequently produced in evidence, being the letters dated 18.06.1991 and 13.11.1991 as Ex. P-5 and Ex.P-10, along with the terms and conditions annexed with the latter document as Ex.P-11, and the Allotment Order dated 11.03.1997 as Ex.P-20, had not been denied, nor had it been denied that the purported cancellation thereof on the part of the Defendant had been entirely verbal, bereft of any formal process backed by a notice or opportunity of hearing. Indeed, the case of the Defendant, as argued, was that the verbal communication of cancellation was sufficient to constitute 'notice' for that purpose.

8. He contended that the argument as to amenity plots not being open to allotment to private parties was fallacious and misconceived, as there was ample precedent in that regard in as much as the Defendant had previously allotted amenity plots to third parties under such circumstances, and had previously regularized the allotment of 73 amenity plots, as reflected in Ex. P-28, albeit that the same were in fact being used other than for amenity purposes, but even so the Defendant had only recovered a differential amount. He also pointed to Regulation 40 of the Building Control and Town Planning Regulations, 2011, of the Defendant, and submitted that the same envisages that plots reserved for petrol stations are amenity plots, which as a matter of practice have been allotted to private companies for running and operating petrol stations.

9. He submitted that the plea being taken in the matter at hand was thus irrational and discriminatory, hence mala fide. It was submitted that the Allotment Order in favour of the Plaintiff had been approved by the Executive Board of the Defendant, and that a vested right had been created in favour of the Plaintiff which could not be cancelled, let alone without notice and without an opportunity of hearing.

10. He placed reliance on judgment of a learned Division Bench of this Court in the case reported as Jamal Nasir v. Karachi Development Authority (K.D.A.) and others 2004 CLC 15, where the cancellation of an allotment without prior notice or proper identification and determination as to there having been a particular violation of any applicable Rules or Regulations was stuck down. Furthermore, reliance was also placed on judgments of learned Division Benches of this Court in the cases reported as Munir Ahmad Ghulam Muhammad Akhtar v. Pakistan Defence Officers Housing Authority 2004 YLR 2047, and Shamim Khan v. Pakistan Defence Officers Housing Authority through Secretary 1999 YLR 410, to show that where an allotment was made by the Executive Board so as to result in the creation of a vested right pursuant to such action, the authority loses locus pontentiae to recall the same. However, on query posed as to how the allotment per se could form the basis for a declaration as to ownership of the Suit Property, learned counsel submitted that the declaration sought was not being pressed in such terms and conceded that the right, if any, of the Plaintiff was confined to preservation/subsistence of the allotment.

11. Conversely, it was submitted on behalf of the Defendant that the instant suit had been incompetently filed, as no valid authority to institute the suit had been conferred on the concerned director by the Board of the plaintiff company in terms of the relevant resolution, the certified extract of which had been filed as Annexure "B" to the Plaint and subsequently produced in evidence and marked as Ex. P/2. The basis of this contention was that the resolution did not contain any reference to a meeting of the Board of Directors having been convened after due notice to all the directors, and reliance was placed on the judgment of the honourable Supreme Court in the case reported as Khan Iftikhar Hussain Khan of Mamdot (Represented by 6 Heirs) v. Messrs Ghulam Nabi Corporation Ltd., Lahore PLD 1971 SC Page 550.

12. Furthermore, it was contended that the Suit Property ultimately vested in the Federation and in the absence of the Military Estates Officer, no effective decree could be made, hence the suit was bad for non-joinder of a necessary party and merited dismissal accordingly. Whilst acknowledging the authenticity of the documents on the basis of which the Plaintiff claimed allotment of the Suit Property, it was accepted by learned counsel for the Defendant that the purported cancellation thereof on the Defendant's part had been entirely verbal, but it was contended that such act was lawful in as much as an amenity plot could not how been allotted in light of the lease between the Government of Pakistan and the Defendant, as per which such a plot could neither be allotted, sold or leased, without approval of the Government, and thus the Executive Board or the Defendant per se was not the competent authority in that regard.

13. It was also averred that an amenity plot is even otherwise to be used for a public purpose, whereas a private marina club is not open to the general public and does not satisfy that test. In this regard, reliance was placed upon a judgment of a learned Division Bench of this Court in the case reported as Morris Tanvir v. Federation of Pakistan through Secretary Ministry of Defence, Islamabad and 2 others 2009 CLC 1199 and dismissal of the Suit was sought in terms thereof.

14. Having considered the arguments advanced at the bar and examined the material on record in light thereof, it would be convenient to firstly address the objection raised as to the issue of maintainability on the ground of alleged lack of authority of the signatory to the plaint. In this respect, it falls to be considered that the objection raised does not relate to the text/content of the resolution in as much as it is not contended that the scope thereof does not extend to the institution of the Suit by the person authorized thereunder or that the signatory is in fact someone other than the person named therein. On the contrary, the substance of the objection is merely that the certified extract of the resolution does not specifically mention that the meeting of the Board, as to therein, was convened after due notice to all the directors, it being contended that the Suit ought to therefore be dismissed in view of the judgment in Mamdot's case (Supra). However, the judgment in the cited case turned on its own facts in as much as the defendant in that case as himself director of the plaintiff company and had impugned the vires of the resolution on the basis that the underlying meeting had not been properly convened as notice thereof had not been sent to him. A specific issue on this point was then framed in that case, evidence was then led, and it was held that the delivery of the notice to the defendant has not been proven, none of which is prevalent in the matter at hand, and the instant case is thus entirely distinguishable. Thus, the aforementioned objection raised by the present Defendant is evidently misconceived and the finding in relation to Issue Number 1 is in the affirmative.

15. With reference to Issue No. 4, which also raises a point of maintainability on the touchstone of the non-joinder Military Estate Officer (MEO), it is noteworthy that no action on the part of the MEO stands impugned in terms of the Suit and no relief has been sought as against the MEO or any party other than the present Defendant. Under such circumstances, the objection as to maintainability on this score appears misconceived and the finding on this issue is accordingly returned in the affirmative.

16. With reference to Issue Number 8 regarding the competency of the Defendant to levy additional development charges, this aspect has apparently become redundant in as much as the Defendant had itself pleaded in Paragraph 9 of its written statement that the charges were only applicable in respect of residential and commercial plots and were not levied in respect of amenity plots, and that the letter demanding the same had been "sent to the allotees due to inadvertent mistake". As such no finding is required to be delivered in that regard. Furthermore, as to Issue Number 2, pertaining to alleged violation of the interim order, no arguments were advanced on behalf of the parties in that regard.

17. Turning now to the substantive issues, being Issues Numbers 3, 5, 6, 7 and 9, in the context thereof it merits consideration that there is no dispute as to the status of the Suit Property, as the parties are ad idem that, by classification, the same is indeed an amenity plot. However, as to the aspect or competency of the Defendant (or lack thereof) to transfer the same, the factum of allotment in favour of the Plaintiff on the basis of the documents produced in evidence stands established and it is apparent that such allotment proceeds on the basis of a sanction from the Executive Board. That being the case, untill the contrary is proved a presumption of regularity would arise that all necessary formalities for performance of such official act have been complied with, as expressed in terms of the maxim omtnia praesumuntur rite esse acta. Alleged lack of competence on the part of its own, Executive Board being a point raised by way of defence, it was incumbent upon the Defendant to demonstrate the same and as the disability was stated to arise in view of the terms of the Lease Deed said to have been executed between the Defendant and the Government of Pakistan, the onus to demonstrate as much through production of such document was on the Defendant, which was not discharged. Furthermore, no specific violation of the terms of allotment was identified by the Defendant in its pleadings, and in the absence of evidence on the part of the Defendant, no discernible violation was brought to the fore or otherwise highlighted during the course of arguments. Moreover, and more importantly, it is evident that no formal procedure was followed by the Defendant for revoking or cancelling the allotment, which would therefore continue to subsist and bind the Defendant, unless and until properly revoked or cancelled vide a speaking order through due process of law after issuance of notice of the proposed action to the Plaintiff and after affording the Plaintiff proper opportunity of hearing in that regard. The precedents cited on behalf of the Plaintiff, as aforementioned, provide ample authority in that respect. Indeed, in Jamal Nazir's case (Supra) it was held that an allotment could not be cancelled without prior notice or proper identification and determination as to there having been a particular violation of any applicable Rules or Regulations. Furthermore, in the cited judgment reported at 2004 YLR 2047 (Supra), where an allotment order in respect of a commercial plot had been cancelled by the DHA on the pretext that such allotment was in contravention of its own byelaws, a Division Bench of this Court held that the DHA had no authority to cancel an allotment made by its own Executive Board. Furthermore, in Shamim Khan's case (Supra), it was held by another learned Division Bench that an allotment made by the Executive Board could not be cancelled where a vested right had been created as the authority loses locus pontentiae to effect such cancellation. Turning to the judgment of the learned Division Bench in the case of Morris Tanveer (Supra), it merits consideration that in Civil Appeal No. 85-K of 2010 arising therefrom, in terms of an Order made on 02.05.2016 the honourable Supreme Court of Pakistan was pleased to set aside the Judgment of the learned Division Bench whilst holding that the amenity plot in question could not be utilized for any other purpose except the running of a School and/or educational purpose and to dispose of the matter on the unequivocal and undertaking of the appellant in that case that the plot in question would only be used for school/educational purposes, being the designated purpose for which it been earmarked. In this regard, it is noteworthy that in the instant case there is no element of conversion or change of land-use, as the intended use of the Suit Property was for purpose of a marina club, and apparently remains so. In view of the foregoing, in the present factual matrix the finding on Issues Numbers 3, 6 and 9 is accordingly returned in the affirmative, whereas the finding as regards Issues Numbers 5 and 7 is in the negative. Needless to say, in the event of any conversion or transgression of the terms of allotment, the Defendant would also be at liberty to take appropriate action against the Plaintiff in accordance with law and the relevant terms, and with adherence to due process as delineated herein above.

18. In view of the foregoing discussion, the Suit is hereby decreed to the extent of a declaration that the verbal cancellation of the allotment made in respect of the Suit Property in favour of Plaintiff by the Executive Board of the Defendant is contrary to the principles of natural justice and is devoid of any legal effect, and that accordingly, subject to any appropriate proceedings as may be initiated by the Defendant in accordance with law, the said allotment presently remains in subsistence and binds the parties in accordance with the terms and conditions applicable thereto. There is no order as to costs. MH/S-32/Sindh Suit decreed.