2004 PLP 151 (YLR)

(f) By sale of all properties if in the name of T.S.L./Debtors and mentioned in Schedule II, as prepared and supplied by A.B.L., which may not be' sold or disposed of until the adjustment of immediate liabilities as agreed. (g) In the event the aforesaid amounts are not recovered within a reasonable period being about 6 to 8 months, in accordance with the terms of this agreement the same shall be recovered by sale of properties mentioned in Schedule II, if belongs to T.S.L. and if any is left, the T.S.L. shall pay, the same from their resources, if any, including any expenses that may have been incurred for recovery of the moneys in (a), (b) and (c) above. Rest of the terms set out the manner in which above property were to be disposed of and liquidated towards satisfaction of liability. In para. (a) above, it was represented by the Judgment‑debtor No.1 that by sale of vessels, judgment‑debtors expected to receive approximately Rs.12.50 crore. It was contended by Mr. Aziz‑ur- Rehman, learned counsel for judgment- debtor that the vessels were sold at the behest of decree‑holder in a very unfair condition to the judgment‑debtor, the value of the vessels was more than the decretal amount is to be adjusted towards the outstanding liability. He pointed that in terms of the subsequent agreement dated 23‑7‑1999 between the Judgment‑debtor No.1 and the decree‑holder Annexure D/2 to the counter‑affidavit said vessels were handed over to the decree‑holder, who alone were responsible to realize the value and sale proceeds thereof. "Mr. Asim denies any recovery on account of sale of any vessel." He contended the vessels mortgaged abroad, were not free from charge and liability. In order to appreciate their respective contention, the operative part of the agreement dated 23‑7‑1999 (D.2) runs into two clauses, which reads as follows: (1) That by this Agreement it is agreed that the properties mentioned at 1(b) and 1(c) of the agreement dated 29‑12‑1998 shall be sold immediately upon the execution of the Agreement, to A.B.L. at the prices determined by the parties hereto by mutual consent or by such method as agreed. Clause 1(g) and clause‑2 for the purposes of clauses 1(b) and 1(c) shall stand modified accordingly, however, the same shall continue for the others. (2) That after the adjustment of the sale price from the aforesaid properties, the balance that shall remain payable and shall be recovered from the vessels and claims as set out in the Agreement. From the bare perusal of above clauses, it is evident that the sale proceeds of the vessels were to be taken into account, after the adjustment of the value of the properties mentioned in clause‑1 above. Nothing has been placed on record to show that the said vessels were sold and or sale proceeds thereof, were deposited or appropriated by the decree‑holder. The documents filed alongwith the affidavit‑in -rejoinder tend to show that various vessels were under arrest at different port in different part of the world No documents were produced by the judgment‑debtors to show that any of the vessels was sold or that sale proceed thereof was credited in the accounts of judgment‑debtors maintained by the decree‑holder towards discharge of any liability. The explanation regarding said vessels as offered by judgment‑debtors as per para. 12 of the affidavit‑in‑rejoinder, is that "said vessels were sold at the behest of the decree‑holder". There is no averments as to repatriation or appropria tion of the sale proceed nor denial of the fact that the vessels were sold by the respective Port Authority and other claimants/creditors of their dues. There is nothing on record to show that the judgment‑debtor, made any efforts to resist or defend such sale of vessels or that any amount out of sale proceed is lying with any foreign. Court or port authority as surplus for the benefit of judgment‑debtor. The correspondence that has been placed on record by the decree‑holder shows that decree‑holder made effort to put up their claim; no documents were produced to show that they succeeded in securing any amount, therefore, contention of Mr. Aziz- ur‑Rehman, as far as it relates to adjustment out of sale of vessels in terms of clause 1(a) of the compromise decree cannot be entertained. Now adverting to property mentioned at Serial No.1(b) i.e. Building on Plot No.33/4, Block 7/8, Banglore Co‑operative Housing Society, Karachi measuring 980 sq. yards referred to above. It was urged by Mr. Aziz‑ur‑Rehman that subject property was agreed to be sold to the decree‑holder and sale price was settled in the sum of Rs.65,635,

000. He therefore, contends that such sale is not disputed and in fact corroborated by Annexure D/12 to the affidavit‑in‑rejoinder which shows acknowledgement of possession and assess ment of the valuation of the same as per Annexure D/14 to the affidavit‑in‑rejoinder, Mr. Asim Mansoor contends that indeed there was some adjustment of the liability against the property in terms of clause‑1(b) of the agreement dated 23‑7‑1999 Annexure D‑2 already reproduced above. It was stated that though the possession was handed over on 17‑12‑1998, as reflected from Annexure D/12, correspondingly the valuation was made by the Estate Valuers as per Annexure D/14. It was assessed to be Rs.65,635,000 such determination according to the learned counsel was prior to the agreement. Parties however, mutually agreed for a valuation of entire property mentioned at para. 1(b) and 1(c) of the decree (reproduced above) to be Rs.65,00,

000. He therefore, urged that if at all the adjustment could be claimed it is to the extent of Rs.65,000,

000. It is stated that such adjustment has been made in the execution application and is reflected in column 4 thereof. I have examined the contention of both the learned counsel on the issue. It is admitted position that the value of the property mentioned at para. 1(b) and 1(c) of the decree reproduced above by the Estate Valuers is prior to the date of Annexure D/2, the agreement wherein both the parties had agreed for a value of the property listed at 1(b) and 1(c) of the decree in the sum of Rs.65,000,000 therefore, valuation as claimed by the judgment‑debtor resting on valuation by Estate Valuers cannot form basis of the adjustment. Accordingly, to the extent of property at Serial Nos.1(b) and 1(c) of the decree, the adjustment is duly shown in the execution. Taking up property mentioned at Serial 1(c) of the decree it was urged by Mr. Aziz‑ur‑Rehman that by virtue of Annexure D/12 possession was handed over value according to him is to be adjusted against the outstanding liability. As is apparent from Annexure D/3 to the counter‑affidavit i.e. agreement dated 16‑11‑1999, acknowledging sale to decree -holder of properties mentioned at Serial Nos.1(b) and 1(c). It appears that no documents have been placed on record to show that the property mentioned at Serial No.1(c) was vendible even otherwise in terms of agreement dated 16‑11‑1999. Both the property mentioned at Serial No.1(b) and 1(c) were sold pursuant to sale‑deed dated 23‑7‑1999 for Rs.65,000,000 there appears to he no separate transaction in respect of the said property independently, at least none has been placed on record. Therefore, no adjustment independently of said property could be claimed in absence of any separate sale or conveyance deed or in absence of any acknowledgement in writing by decree‑holder to such effect as required under Order 21, rule 2(2) read with section 151, C.P.C. Adverting to the property mentioned at Serial No.1(d) i.e. B‑12 K.D.A. Scheme No.1 in the very terms of the decree already produced above. Parties agreed that the subject property will be sold after clearance of the charge of the Prudential' Commercial Bank Limited. Learned counsel for the judgment‑debtors Mr. Aziz‑ur‑Rehman, contended that the possession of the property was handed over to the decree‑holder. He has drawn my attention to Annexure D/15 to the counter -affidavit filed by the decree‑holder which shows that the decree‑holder has acknowledged possession of the subject property on 16‑11‑1999. From para. 8 of the decree, it is evident that said property was already under the charge of Prudential Commercial Bank in the sum of US$ 1.5 millions. There is no material on record to show that such charge has been cleared and/or the property was redeemed by the judgment‑debtor, or any conveyance deed has been executed in favour of the decree- holder. Since possession of the property has been acknowledged by the decree‑holder in equity the decree‑holder is liable to appropriate rental value of the same with effect from the date of possession i.e. 16‑11‑1999, subject property is situated in K.D.A. Scheme No.1, and property is being and will be enjoyed by the decree -holder, till property is sold subject to the lien/charge of Prudential Commercial Bank. Decree‑holder is liable to give adjustment of rental value towards liquidation of liability under the decree. In order to determine the rental value, I appoint Nazir to conduct an enquiry as to the rent as could be fetched in respect of property bearing No.B‑12, K.D.A: Scheme No.1, Karachi with effect from 16‑11‑1999 upto date, within a period of 2 months, tentatively Nazir fee in the sum of Rs.10,000 to be paid by the decree‑holder. Amount of rent so determined by the Nazir will be adjusted towards liquidation of decretal amount till such time said property is sold and amount appropriated after adjustment of liability of Prudential Commercial Bank Ltd. Adverting to the property mentioned at Serial No.1(e), (shares in Delta Insurance Company), it was stated by Mr. Aziz‑ur‑Rehman that the judgment- debtors had handed over shares of Delta Insurance Company to the decree‑holder with blank transfer deed. According, to him 74,00,000 shares of face value of Rs.10 as per Annexure D‑14 to affidavit‑in‑rejoinder were handed over to the decree‑holder, Face value comes to Rs.74,00,000 which amount is liable to be adjusted against the decretal liability. Mr. Asim Mansoor learned counsel for the decree‑holder states that the such shares are nothing but paper script of no value. According to him said shares were delivered on 8‑1‑1999. Mr. Asim has drawn my attention to Share Index reflecting highest and lowest value of such shares. Highest value in the year 1999 was Rs.5. According to him, unless the shares are sold by the decree‑holder or transfer in its own name is effected, no adjustment could be effected. In order to appreciate their rival claims as to shares of Delta Insurance Company, manner in which parties, agreed to deal with shares is stipulated in paras. 9 to 12 of the agreement and decree which read as follows:‑‑

9. That the debtors jointly and severally hold, 2,100,000 shares of Delta Insurance Company Ltd, of the face value of Rs.10 each, being the Rs.21,000,000 which shares shall be pledged with A.B.L. alongwith blank Transfer Deed duly verified. The debtors, however, state and represents that some of the shares are `Benami' though in the name of other persons, and the debtors are ostensible owners thereof.

10. A.B.L shall have absolute and unfettered discretion in respect of the shares of Delta Insurance Company, whereby A.B.L. may at any point in time choose to sell the said shares and/or have the same transferred in their own name. A.B.L. or their nominee may therefore, lodge the said shares for transfer in their own names or their nominee or the name of the purchaser. The Director of the company (Delta Insurance Company Limited) shall transfer the said shares as afore-stated. Upon the transfer being effected the debtors who are on the board in their personal capacity or as nominees shall resign, and co‑opt such number of nominees on the Board of Directors of the company as were representing the debtors.

11. That upon the transfer in favour of A.B.L., if any, the value of the subscribed shares shall be taken at its market value and upon calculation of the rate at the market value obtained from the circular of the Karachi Stock Exchange on the date of its transfer, such amount shall be transferred to the credit of Tristar Shipping Lines Limited for reduction of their liability for such sums as the said share may value. If the said shares are sold, the amount received by such sale, shall be credited to the account of T.S.L. by which amount the accounts shall be reduced. If any amount is left after adjusting the account, it shall be utilized for adjusting the associated 'companies/undertakings/firms/debts/liabilities. However, if the right shares are taken up and paid by A.B.L. there shall be no reduction of liability.

12. That in the event the amount of Rs.236,454,000.00 the immediate payment, as promised by the debtors is paid within the stipulated time of 6 to 8 months, or such extended time, the 2,100,000 pledged shares of Delta Insurance Company Limited as also the other securities in respect of the said finances shall be returned/resold, in the event of a transfer by A.B.L. to the debtors, within 30 days of the last payment of the instalments liable to be paid. Contentions of Mr. Asim Mansoor are fortified from the perusal of paras. 11 and 12 of the agreement as incorporated in decree, as reproduced above. Market value of the share that may be obtained as per circular of the Karachi Stock Exchange on the date of transfer is the relevant date and since such share as stated above have not been transferred. No adjustment could be claimed by the judgment‑debtor. The decree‑holder may sell the share of Delta Insurance Company within 15 days or if such shares are not sold as stated above the maximum value prevailing on the 30th day from the date of this order in terms of the circular of the Karachi Stock Exchange would be taken up as market value for the purpose of adjustment towards the decretal liability of the judgment‑debtors. Mr. Aziz‑ur‑Rehman also contends that share in Tristar Shipping Lines Ltd, were also handed over to the decree‑holder in satisfaction of the admitted liability. He has again relied on Annexure D/6 to the counter‑affidavit dated 8‑1‑1999 that shows acknowledgement of 74,00,000 shares in Messrs Tristar Shipping Lines Ltd., Mr. Asim states that such shares are not being traded in the Stock Exchange, shares are of no value. Reliance is again placed on the Share Index/Circular of the Stock Exchange for the relevant period. Against the name of Tristar Shipping Lines Ltd., at Serial No.689, there appears to be no trading in the share of said company therefore, no adjustment at all could be given of a property which is of no value. In terms of Order 21, rule 2, sub -rule (2) where any amount payable under decree is paid out of the Court or where the decree is adjusted in whole or in part to the satisfaction of the decree‑holder the decree holder certification or adjustment is to be recorded by the Court, but where such settlement is claimed in terms of sub‑rule (2) to rule 2 of Order 21, C.P.C. judgment debtor may also inform the Court. In instant case judgment‑debtor has‑ invoked Order 21, rule 2(2), C.P.C. The Executing Court after notice to the decree‑holder may record discharge, satisfaction or adjustment in whole or in part as the case may be. adjustment is to be recorded subject to the satisfaction of the decree‑holder. In this case Decree-holder has only certified and acknowledged to have received Rs.6,50,00,000 as against the property mentioned at Serial Nos. 1(b) and (c) of the decree. In term of Order 21, rule 2(3), where the payment is not made in accordance with rule 1 of Order 21 or where adjustment is not made in writing executing Court is not obliged to record satisfaction, adjustment or discharge of liability. Rule 1 of Order 21, C.P.C. provides the manner in which money could be paid under the decree of the Court, namely (i) payment into the Court, whose decree is to be executed; (ii) out of the Court to the decree‑holder though Bank postal money order or acknowledgment duly signed by the decree‑holder or his authorized agent; (iii) "otherwise as the Court, which made the decree directs". Mr. Aziz‑ur‑Rehman laid much emphases on the third mode referred to above namely "otherwise, as the Court may direct". He placed reliance on the dictionary meaning of word "otherwise" as per the New Oxford Dictionary of English and the case of Sardar Abdul Ghafoor v. Federal ‑ Land Commission PLD 1979 Lah. 375 in para. 4 of the cited judgment "otherwise" is defined as:‑‑ "The word `otherwise' according to the dictionary meaning connotes in `any other way' or `any other ways'. Its plain ordinary meaning has therefore, the effect of enlarging the category of the transaction described by the preceding word or phrase. It is a word of the widest amplitude." What Mr. Aziz‑ur‑Rehman learned counsel oversights while laying undue emphasis on phrase "otherwise" is the words following thereafter that is to say "as the Court which made the decree direct". He was unable to show that the Court which made the decree directed a different mode for adjustment of the value of the shares. The decree clearly outlined the manner in which the value of share was to be determined and date of its adjustment is clearly spelt out in paras. 11 and 12 of the decree reproduced above. Neither any other mode for adjustment of value of share has been pleaded nor any acknowledgment of decree‑holder has been placed on record to show that such pledged shares were acknowledged to be adjusted against outstanding decretal liability. There is nothing on record to show that decree‑holder either sold the pledged shares or got the shares transferred in its own name. Admittedly satisfaction of the decree is not claimed in terms of the first mode recorded above, at the best it could be claimed to be as per second mode set out. As already discussed above, merely handing over possession of the property mentioned in the decree or of the shares script is not sufficient in terms of Order 21, rule

1. The adjustment of decree either whole or in part, could only be recorded subject to the satisfaction of the decree- holder. From the documents and material referred to above, prima facie realization or the liquidation of the assets or property which were handed over to the decree- holder cannot be presumed. At the best same may be treated as security/under pledged or lien of the decree‑holder for repayment of decretal amount. In respect of property mentioned at Serial No.1(a) i.e. the vessels as discussed above, no material was placed on record to show that decree -holder realized any amount against said vessels. Property mentioned at Serial No.1(d) i.e. House No.B‑12, K.D.A. Scheme No.1 is already mortgaged with Prudential Commercial Bank Ltd. The judgment‑debtor Masood Tariq Baghpatee had undertaken to clear the liability within 6 to 8 months from the date of the, agreement i.e. w.e.f. 29‑12‑1998 nothing has been produced to show that such liability of Prudential Commercial Bank has been cleared. As regards, Share Certificate of Delta Insurance Company and Tristar Shipping Lines Ltd., pledged with decree‑holder same are not yet sold or transferred in favour of decree‑holder, therefore, in terms of paras.11 and 12 of the decree such adjustment could not be recorded unless same are transferred: Even otherwise, as per share Index/Circular of said Companies shares are hardly of any value. The Executing Court in view of bar under sub‑rule (3) of rule 2 of Order 21, C.P.C. cannot acknowledge any of the settlement said to have been arrived at except in the manner provided for under rule 1 or Order 21, C.P.C. The judgment‑debtors have failed to demonstrate that substantially any liability or assets of judgment‑debtor was liquidated towards the satisfaction of decree except the property mentioned at Serial Nos.1(b) and (c) of the decree. Such adjustment has already been given by the decree‑holder. The application under Order 21, rule 2(2), C.P.C. under facts does not merit consideration, is accordingly dismissed. The adjustment is claimed by the judgment‑debtor to the extent of property mentioned at Serial No. 1 (b) has already been recorded` in the execution for the recovery of the balance amount, let property mentioned at Serial No. C, D and E in Column No.11 to the execution application in the first instance be attached and sold. Nazir is appointed as Commissioner to undertake such exercise. Tentatively the decree‑holder shall deposit Rs.25,000 as Nazir fee in addition to whatever cost that may be incurred on effecting publication and or other incidental expenses for taking over the possession, control of the said properties. Nazir may also appoint Chowkidar and or Security Guard to effectively secure, protect the properties and carry out such object. Administrative assistance including police aid and may also be obtained, if necessary to implement and execute order of the Court. Resultantly the execution as prayed is allowed with costs. S.A.K./A‑506/K Execution allowed.