1998 PLP 1453 (CLC)

9. The learned counsel for the parties have been heard at length. The case of the petitioner is that clause 27 of the new allotment letter, dated 30‑9‑1993 provides, "the allottee will be relieved of his obligations whenever and to the extend to which fulfilment is directly prevented, frustrated or impeded, to the satisfaction of the Authority, as a consequence of war, any circumstance arising outside the control of the allottee ....". The case of the petitioner is that they had fulfilled all the obligations due on their part, but respondents Nos, l to 3 failed to deliver the actual physical possession of the property with a clear title and free from encroachments. The continuance of the litigation in respect of the plot has even not been denied by the respondents, who in their reply have contended that Capital Development Authority' was in no way responsible for the acts and illegal claims of other parties. The respondents have admitted that the civil suit instituted by Raja Ali Shan is still pending before the Civil Court at Islamabad, on the basis of an erroneous concession made by the Capital Development Authority's Counsel before the District Judge. It has been pleaded by the petitioner that the delay which occurred in the payment of the instalments was due to the pending litigation and because of the failure of the respondents to hand over the actual physical possession of the plot, without which the petitioner could not proceed with the construction of the Hotel, which was the real object of the allotment of the plot. It is an admitted position that the litigation commenced by Raja Ali Shan, laying his claim over a portion of the plot measuring approximately 11 Kanals and claiming it to be his family graveyard, is pending till date. Further, it has been admitted by the respondents through various communications referred to hereinabove that said Raja Ali Shan was physically holding the land in question till as late as October/November, 1995, and even the respondents were fearing a law and order situation on account of his efforts to grab the plot in question. Assistance was even desired by the respondent‑Authority from the Chief Commissioner, Islamabad so as to handle the situation resulting from the activities carried on by Raja Ali Shan on the premises. As per the stance of the respondents, if they cannot be made responsible for the litigation and for the encroachments made thereon, then question arises whether the petitioner‑Company could be burdened with such a responsibility and any consequent financial liabilities. The answer to this question shall obviously be in the negative. In support of its case, the petitioner has relied upon PLD 1991 SC 782 (Fateh Khan v. Boze Miry, PLD 1990 SC 859 (Muhammad Hanif and others v. Muhammad and others), PLD 1989 SC 146 (Rashid Ahsan and others v. Bashir Ahmad and others), PLD 1994 Karachi 233 (Mst. Khadija Bai and others v. Muhammad and others) PLD 1993 Lahore 11 (Col. Retd. Muhammad Aslam v. Haji Muhammad Shafi and others) and 1989 CLC 1365 (Iqbal Ahmad v. I.D.B.P. and 3 others), wherein it has been‑laid down that a party cannot be made to suffer on account of the acts of the Court. In PLD 1989 SC 146 it has been held that:‑‑‑

"The maxim 'Actus curiae neminem gravabit' comes into play, with a view to obviate hardships and which may otherwise be the result of the errors of the Court itself. Thus, where a non‑compliance with the mandatory provisions of a law occurs by complying with the direction of the Court which is not in conformity with the law, the party complying therewith is not to be penalized. Indeed, the law becomes flexible to absorb such abnormalities and treat the infractions as harmless. Where the directions issued while administering the law have been followed but it is found that the authority itself had acted in deviation of the law in some particulars, the party acting in accordance with such directions is not held to be blameworthy."

10. In view of the factual position highlighted above, the litigation in respect of the plot can in no way be attributed to the petitioner. It is the case of the petitioner that it has incurred heavy losses on account of the litigation and on account of the non‑delivery of the actual physical possession of the plot. A huge amount of Rs.5,12,86,795 has remained struck up with the respondents since 1991, which in the normal course of time and as per the prevailing rates of mark‑up, would have earned a profit of Rs.5,30,22,

655. Moreover, according to the petitioner, the cost of the project has also increased from Rs.80 crores to Rs.247 crores since 1991. In fact, it has been admitted by the respondents in their written reply that the Civil Suit of Raja Ali Shan is pending till date on the basis of an erroneous concession made by the Capital Development Authority's Counsel. In the normal course, the respondents were justified to call for the payment of the delayed charges from the petitioner, but in the peculiar circumstances of this case, when the plot allotted in favour of the petitioner remained subject‑matter of litigation and encroachments on the site, without any fault or lapse of the petitioner, they cannot be penalized for the acts of others.

11. It is the case of the respondents that the petitioner was handed over the possession of plot on 12‑3‑1991 soon after the allotment made in its favour in the year 1991, when the plot was free of encroachments. The record, however, reveals that allotment was challenged through a Constitutional petition and it was by order, dated 11‑10‑1992, passed by the High Court that a new allotment order in respect of the plot was issued. The Board of the Capital Development Authority resolved on 16‑1‑1993 that the plot be allotted to the petitioner. Later, the respondents took eight months to issue the new allotment letter, dated 30‑9‑1993, without giving any justification for the delay in the issuance thereof. It has been contended by the petitioner that in terms of the decision of the High Court, the initial allotment made in their favour was set aside and the possession automatically stood restored to the Capital Development Authority. Reliance in this regard has been placed on PLD 1958 SC 104 (Muhammad Aslam Zia and 2 others v. Yousaf Ali PLD 1973 Lah. 546, Haider Ali and others v. Akbar Ali and another), PLD 1995 Karachi 452 (Akbar Hussain v. Wadero Muhammad Tayyab). In PLD 1958 SC 104, it has been held that:‑‑‑-- "If on the basis of a void order subsequent orders have been passed either by the same authority or by other authorities, the whole series of such orders, together with the superstructure of rights and obligations built upon them, must unless some statute or principle of law recognizing as legal the changed position of the parties is in operation fall to the ground because such orders have as little legal foundation as the void order on which they are founded. "

12. In view of the abovesaid position of law, the possession of plot earlier handed over to the petitioner on 12‑3‑1991 lost any legal value, as the earlier allotment was set aside by the High Court on 11‑10‑1992. According to the petitioner, the respondents had failed to hand over the possession over the plot/land, after the issuance of new allotment order. Reference was also drawn by the petitioner's learned counsel to Clause (13) of the new allotment letter, dated 30‑9‑1993, whereunder, it was contracted between the parties that "possession of the land shall be taken over by the allottee within one month from the date of issue of this letter, failing which possession shall be deemed to have been taken over". Thus, if the possession of the plot delivered to the petitioner on 12‑3‑1991, remained intact, as contended by the respondents, then there was no requirement of law to stipulate and make a provision for the handing over of the possession of the plot in favour of the petitioner in the new allotment letter. The respondents have failed to produce any document whereby they tray prove the delivery of possession of the plot to the petitioner pursuant to the fresh allotment. The petitioner's real object for participating in the bid for the allotment of the plot was to construct a 5‑Star Hotel on the plot in question, and until actual physical possession of the plot was delivered, the project could not be undertaken involving huge financial investment. Through the correspondence exchanged between the patties, which has been placed on the record of the Court, it is established that the petitioner had never denied the payment of the balance premium, and they were always ready and willing to do the same, provided the possession of the plot was delivered with a clear title and free of encroachments. The litigation initiated by Raja Ali Shan demonstrates that there was some dispute in respect of the title of the plot in question. The correspondence of the respondents further establishes that there were some encroachments over the plot and the respondents also anticipated a law and order situation to arise if encroachments were removed during the pendency of litigation and "status quo" order issued by the Courts. The law required that respondent‑Authority would proceed to allot only that plot, over which it had clear title and which was also free from encroachment. From the above facts, it is clearly established that the petitioner was not delivered the possession of the plot with a clear title and free from encroachments, and in that view of the matter, it could not be penalized for the acts of the Authority or on account of litigation/circumstances beyond its control.

13. It is further submitted that the respondents should have not proceeded with the allotment of land until they had perfected their title and further the time spent on litigation could not have been utilized to their own advantage. In support of these contentions, reliance was placed on the following case‑law:‑‑‑ PLD 1973 SC 39 (Seth Essabhoy v. Saboor Ahmad) it has been held in this authority:‑‑‑ "It was the appellant's obligation to get the plot converted into Sakni plot, he should have done that before calling upon the respondent to complete his part of the contract. ‑‑‑However, in cases where the defendant himself has committed breach of the contract, it is not obligatory on the complainant in a suit for specific performance to prove his willingness to perform it up to the date of the filing of the suit. " 1996 MLD 322 (Haji Adam Ali Agaria v. Asif Hussain and 2 others), it has been held that in this authority:‑‑‑ "Time as assence of contract‑‑‑Exception‑‑‑Time would ordinarily not be considered as assence of contract in cases relating to transfer of immovable property‑‑‑Party in breach of contract, however, could not be permitted to take advantage of its own wrong and to blow hot and cold at the same time‑‑‑Stipulation of time fixed in agreement in question would not result in frustration of contract and defendant having been guilty of contravention of terms of contract itself, would not be entitled to revoke the same." PLD 1987 shore 166 (Mehraj Din v. Karam Din and others), it has been held that:‑‑‑

Performance of contract‑‑‑Time consumed on account of vendor's contest in litigation‑‑‑Utilization of‑‑‑Time spent on account of vendor's litigation, held could not be utilized by him to his own advantage to contend for being relieved of obligation to sell because of prices having in meantime risen sparingly‑‑‑In agreement vendor had also undertaken to obtain clearance certificate from Income Tax Department and Property Tax Department before executing sale‑deed on specified date which he failed to obtain. " AIR 1958 Punjab 289 (Dins Nath Dutt v. Maha Vir Gupta), it has been laid down that:‑‑‑ "Even if time is the essence of a contract of sale, where the vendor has not perfected his title to the goods by the date when the contract has to be completed, there is no breach of the contract on the part of the vendee, if he failed to pay the consideration on that date and complete the contract. " AIR 1962 Calcutta 103 (Nanik Lal Karmarkar v. Shankar Lal Shah and another) wherein it has been held that:‑‑‑ "The Court of appeal below held that the plaintiffs had done all that was required of them to complete the transaction within the time. Reading the correspondence ourselves we are also of the opinion that the defendant's attitude towards the completion of the transaction was half hearted and alternated between inclination and disinclination. The transaction was not completed, within the time agreed upon largely because of the attitude of the defendant himself. The 'surrounding circumstances' of this case are such as would excuse the plaintiffs failure to complete the transaction within the agreed time. We therefore, overrule the contention that delay on the part of the plaintiffs disentitled them to any relief. In our opinion it is not open to a defendant to cause the delay and to try to defeat the plaintiff's claim on the ground of such delay." Applying the above settled principles of law to the case in hand, it came be seen that the litigation in relation to the title and allotment of the plot was not initiated by the petitioner but by others, over which the petitioner had no control. The petitioner, whose huge amount of Rs.5,12,86,795 already stood deposited with the respondents, was justified in not incurring further cost and risk during the pending litigation, which would be the attitude of any prudent person. In this view of the matter, it is therefore, contended on behalf of the petitioner that it cannot be subjected to a penalty/penalties for not paying the instalments of the premium during the pendency of the litigation and the decision of the respondents to the contrary is not tenable in law.

14. Learned counsel for the petitioner has further contended that while interpreting the terms of the allotment letter, the whole of the document has to be considered in totality and the terms, pertaining to the delivery of the possession of the plot and the payment of the balance premium have to be harmoniously read; the condition, regarding the payment of the instalments could not be invoked by the respondents without first fulfilling the condition as to delivery of actual physical possession. Reliance is placed on 1998 PLC 166 (Miss Khurshid Shafiullah etc. v. Messrs Park Davis & Co. Ltd.), 1994 MLD 476 (Province of Punjab etc. v. Malik Muhammad Ilyas), 1992 SCMR 19 (H.B.F.C. v. Shahinshah Humayun Cooperative House Building Society and others) and PLD 1992 Karachi 46 (Mst. Bakhat‑e‑Rawida v. Ghulam Habib etc.). In the above cited case‑law, it has been laid down that the document embodying a contract is to be interpreted according to the intentions of the parties; construction thereof, must be reasonable liberal and with a spirit to save rather than destroy it; ordinary sense of the words is to be followed and the whole of the document is to be looked at in order to gather the intention of the parties. The allotment letter, dated 30‑9‑1993 prescribes various terms and conditions, which pertain to the period of lease, the approval of plans, laying of services, delivery of possession, payment of premium, the execution of the lease deed, the commencement and completion of the construction and various other rights and obligations of the parties involved. Clause (15) of the allotment letter states that the petitioner shall have the start construction, after the approval of the drawings/plans, within a period of twelve to fifteen months and finish it within a period of five years. The construction of the Hotel could only be possible once physical possession was handed over to the petitioner. The respondents have not placed any document on the record to show that the petitioner was handed over the possession of the plot pursuant to the new allotment letter issued on 30‑9‑1993. When the whole of the Contract/Allotment letter is considered in its entirety, the respondents were bound to transfer the possession of the plot to the petitioner, which they have not done in the present case. Maxwell on the Interpretation of Statutes, Twelfth Edition, on the page 212 states as under:‑‑‑ "On the general principles of avoiding injustice and absurdity, and construction will, if possible, be rejected (unless the policy of the Act requires it) if it would enable a person by his own act to impair an obligation which he has undertaken or otherwise to profit by his own wrong. A man may not take advantage of his own wrong. He may not plead in his oven interest self‑created necessity." On page 256 of the said book it is stated that:‑‑‑ "Statutes which impose pecuniary burdens are subject to the same rule of strict construction. " In the circumstances, when the respondents themselves failed to complete the obligations due under the Allotment Order, it was not lawful on their part to demand the balance amount with benefit of instalments and impose penalties on the petitioner, for the delay in the payment of the premium, for which the petitioner‑Company could not be made liable.

15. By citing the precedent case of M/s. Sarena Hotels Limited, the petitioner‑Company has tried to make out a case of discrimination by the respondents. By referring to Annexure ' T' with the writ petition, it has been pleaded that the allotment of plot for 5‑Star Hotel has been restored in favour of M/s. Sarena Hotels Limited with condonation of delay in construction and waiver of restoration charges. However, it was argued by the counsel for the respondents that M/s. Sarena Hotels Limited had paid the premium price alongwith the delayed payment charges; and the restoration charges have nothing to do with the delayed charges, and further that they did not have the authority to waive the delayed payment charges. The stance of the respondents is not acceptable. If in the case of M/s. Serana Hotels Limited, the respondents have the authority to waive the restoration charges, then there was no legal justification for not extending the like treatment to the petitioner‑Company. The impugned order/decision of Capital Development Authority, thus, would be violative of Articles 4 and 25 of the Constitution.

16. The respondents' last submission is that the payment of the premium of the plot had no nexus with the delivery of the possession and the construction of the Hotel. They placed reliance on the decision of the Wafaqi Mohtasib in complaint No.REG‑1/4561 of 1990. The said decision is distinguishable as it does not pertain to the delivery of the possession, but only deals with the delay in the laying of services, which have to be provided from the money generated from the collection of premium. The Director of Wafaqi Mohtasib in the referred case, however, has held that "CDA failed to provide service facilities to the complainant in the stipulated period. In such circumstances, levying of surcharge before the provision of required facilities to the complainant admissible to him under the rules is not tenable. Accordingly, when the surcharge is not due from the complainant the question of outstanding dues on this count does not arise". The decision of the Director Wafaqi Mohtasib, in fact, favour the case of the petitioner.

17. As a natural corollary to the aforesaid discussion of the factual position as also the examination of the legal principles applicable to the petitioner's case set at rest by the judgments of the Superior Courts referred to hereinbefore, it is proved that the plot allotted to the petitioner was subject‑matter of litigation since 1991. The respondents failed to deliver the possession of the plot to the petitioner, with a clear title and free of encroachments, which resulted in the delay in the payment of the premium price. Non compliance of the terms of the allotment order by the respondents, ensuing from litigation and the I encroachments on the plot, legitimately gave a right to the petitioner to require the respondents to restore actual physical possession to enable them to pay the balance price and proceed with the project. The petitioner cannot be made to suffer for the acts of others or the actions/inactions on the part of the respondents. In the circumstances, I am constrained to hold that the respondents cannot impose the delayed payment charges and the impugned order to that extent is declared to be illegal, without lawful authority and of no legal effect. The petitioner has also sought a direction for the payment of mark‑up on the amount, which remained deposited with the respondents in the meanwhile. If the delayed payment charges are being declared as without lawful authority, the petitioner's claim, in asking for the payment of the mark‑up on the amount deposited by it with the respondents, is also not justified. The petitioner has sought a direction to pay the balance premium in nine equal instalments, as originally agreed to but on account of the delay already caused by the pending litigation, it is directed that the petitioner shall deposit the balance premium amount in six equal instalments of Rs.1,77,53,121.33 each, with a direction to deposit the 1st instalment within a week and the next instalments in the next 15 months. The respondents are directed to deliver the actual physical possession of the plot clear of all encroachments immediately on the deposit of the first instalment. The writ petition is accepted in the above terms with no order as toy costs. A.A./E‑8/L Petition accepted