1989SCMR868 (PLP)

ALI HUSSAIN QAZILBASH, J.‑‑These are two appeals by leave from the judgment of the Lahore High Court, dated 8‑9‑1971.

2. Mirza Tasawar Ali Beg and his wife Mst. Feroze Fatima are the owners of House No.29, Block A, Model Town, Lahore in equal shared. On 4‑2‑1970 Mirza Tasawar Ali Beg, appellant, executed an agreement with Abdur Rashid, respondent No.l, whereby Muza Tasawar Ali Beg for himself and on behalf of his wife Mst. Feroze Fatima agreed to sell the above house to Abdur Rashid Khan, respondent for a consideration of Rs.1,00,000 by 30‑6‑1970 and to deliver vacant possession of the same to him by the said date. In the agreement it was given out that Mst. Feroze Fatima had already given her permission to her husband to sell the said house. According to the agreement (Exh.P/1) Mirza Tasawar Ali Beg, appellant, had received a sum of Rs.5,000 through a cheque as earnest money while the balance was to be payable to him at the time of the execution and registration of the sale‑deed on 30‑6‑1970. It was further laid down in the deed that if the vendors i.e., Mirza Tasawar Ali Beg and his wife Mst. Feroze Fatima refused to execute the sale‑deed they, besides refunding the earnest money of Rs.5,000 would pay to Abdur Rashid Khan, respondent, a further sum of Rs.5,000 as damages. It is alleged that on the evening of the same day i.e. 4‑2‑1970 possession of the house was handed over to Abdur Rashid Khan, respondent, and it was agreed between the parties that for the intervening period till 30th June, 1970, when the sale was to be finalised, Abdur Rashid, respondent, will pay Rs.5,000 per month as rent.

3. After the above said agreement lengthy correspondence took place between Mirza Tasawar Beg, appellant and Abdur Rashid, respondent, regarding 'he sale of the House when on 19‑6‑1970 Abdur Rashid Khan received a letter from Mirza Tasawar Ali Beg, appellant, stating that he and his wife had for the time being given up the idea of selling the house in question as the price was too low and that he would sell the same if it fetched Rs.1,20,

000. On 29‑6‑1970 Abdur Rashid Khan sent a notice to Mirza Tasawar Ali Beg, appellant, complaining that he had been a victim of deception on the part of Mirza Tasawar Ali Beg inasmuch as it was expressly recited in the agreement that he had the authority from his wife to sell the property and demanded of him execution and registration of the sale‑deed failing which the respondent would go for a suit for specific performance of the contract. This was replied to by Mirza Tasawar Ali Beg, appellant on 8‑7‑1970, wherein he controverted the allegations and further took a stand that it was his privilege in terms of the agreement to sell or not the house in question. This was followed by another notice in the name of Abdur Rashid Khan, respondent, on 31t‑8‑1970.

4. Faced with the above situation Abdur Rashid Khan respondent, on 19‑9 1970 instituted a suit against Mirza Tasawar‑Ali Beg and.his wife Mst. Feroze Fatima seeking specific performance of the agreement dated 4‑2‑1970. Both Mirza Tasawar Ali Beg and his wife submitted their written statement on '5‑I1‑1970 denying the liability for specific performance of contract on the ground that at the time of the execution of the said deed it was agreed between the parties that in case of revocation of the agreement to sell by the, appellants, Abdur Rashid Khan would be entitled to receive a sum of Rs.5,000 as penalty in addition to the refund of the amount of Rs.5,000 paid by him as earnest money. It was further alleged that the above option was exercised and a sum of Rs.10,000 had been sent by two cheques. Before framing that issue, the learned trial Court recorded better statements of the parties and also received from the parties a number of documents. Mirza Tasawar Ali Beg, appellant, admitted the execution of the agreement to sell and certain other documents and stated that MsI.Fero7e Fatima appellant had not given him any power of attorney to sell her share in the said property. This statement was also corroborated by Mst.Feroze Fatima appellant, who stated that she was not bound by the said agreement, in that no prior permission or consent had been obtained from her. The pleadings led to the framing of the following issue:‑‑ (1) Whether the plaintiff is entitled to the specific performance of the agreement to sell the disputed property? O.P.P.

5. The learned trial Court, after recording the evidence of the parties, vide its Judgment, dated 13‑11‑1972 decreed the suit of Abdur Rashid Khan, respondent, to the extent of half share owned by Mirza Tasawar Ali Beg holding that there was no valid legal repudiation by him of the said agreement, but dismissed the suit of Abdur Rashid Khan, respondent, in respect of the half share owned by Mst. Feroze Fatima holding that her husband Mirza Tasawar Ali Beg had no power of attorney on behalf of his wife to act on her behalf and to enter into any agreement to sell her portion of the house. This judgment was impugned by Mirza Tasawar Ali Beg, appellant through R.F.A. No.19 of 1973 in the High Court and also by Abdur Rashid through R.F.A. No.8 of 1973. The above two appeals came up for hearing before the learned Division Bench of the Lahore High Court on 8‑7‑1981 whereby the suit of Abdur Rashid qua the share of Mirza Tasawar Ali Beg appellant, was affirmed and by accepting the appal of Abdur Rashid Khan reversed the finding of the learned trial Court in respect of the remaining half share owned by Mst. Feroze Fatima. Thus decreed the suit of Abdur Rashid Khan for specific performance of contract in its entirety on the payment of a sum of Rs.1,00,000.

6. We have heard M/s. Zakiuddin Paul, Advocate for arid Ch. Khalilur Rahman, Advocate against the appeals and gone through the record of the case and the authorities cited by the Bar. The learned Trial as well as the Appellate Courts have admitted the claim of Abdur Rashid Khans respondent and decreed his suit for specific performance of the contract in so far as the share of Mirza Tasawar Ali Beg appellant is concerned, but came to a different conclusion qua the share of Mst. Feroze Fatima. As the record stands, we are also inclined to agree with the findings of the Courts below in respect of the sale of the half share in the suit house owned by Mirza Tasawar Ali Beg appellant. We have carefully gone through the deed of agreement to sell (Exh.P/1). Though it is stipulated in the concluding portion of the said deed that if either of the parties failed to comply with certain conditions so laid down, within the stipulated period, the transaction would be treated as cancelled. This agreement, however, did not contain any clause giving expressly any power or authority of repudiation of the agreement to Mirza Tasawar All Beg appellant. Thus the contention of the learned counsel for the appellant that the said document contained an authority for unqualified repudiation of the agreement is far from correct. Again the contention of the learned counsel for the appellant that the agreement to sell was repudiated through a letter, dated 19‑6‑1970 (Exh.P/3) is rather fallacious, in that this letter did not have even such an inkling, what to speak of repudiating the agreement. Through this letter Mirza T'asawar Ali Beg appellant simply informed to the respondent No.1 that for the time being the sale of the house has beer postponed because the price offered was less and if someone offered Rs.1,20,000 the house would be sold otherwise not. The perusal of the record shows that prior to the issuance of letter dated 19‑6‑1970 (Exh.P/3) Mirza Tasawar Ali Beg ‑‑appellant had sent two letters, dated 10‑3‑1970 (Exh.P.10) and 2‑4‑1970 (Exh.P.11) to respondent No.1. In the former letter he only conveyed disapproval of the proposal by his ,Nif,‑ and in the latter letter reference about the fixing of a lesser sale price of the house. had been made. In none of these letters he did not repudiate the deed of agreement therefore, it has rightly been held by the Courts below that Mirta Tasawar Ali Beg appellant did not repudiate the agreement as required under the law.

7. As for the contention of the learned counsel for Mirza Tasawar Ali Beg, appellant, that since the deed of agreement (Exh.P.l) carried a compensation clause, a suit for specific performance was not competent, this proposition has begin discussed threadbare and revelled by the Courts below. The learned Judges of the high Court, after taking into consideration the relevant provisions of the Specific Relief Act, came to tire conclusion that the sum of Rs.5,000 mentioned in the deed of agreement was merely a penalty against the non‑performance by the vender and as a security for performance of the contract on the part of the vendor than as true: assessment of damages. Interpreting section 12(c) read with its explanation, the learned Judges have held: "The explanation makes it clear that it is mandatory for the Court to presume that the breach of a contract to transfer immovable property cannot be adequately relieved by compensation. The onus of proving that such a contract can be relieved by compensation clearly lies on the party asserting so. It has to be established by adequate relief. However, mere fact that there is a compensation clause is not conclusive proof of the fact that compensation is an adequate relief although it is one of the elements of the said proof." Further interpreting Section 20 ibid, it was held:‑ "More important provision however is section 20 which provides that a contract otherwise proper to be specifically enforced, may be thus enforced., though a sum be named in it as the amount to be paid in case of its breach, and the party in default is willing to pay the sane. This section affords a complete' answer to the plea raised by the learned counsel for Mirza 'I asawar All Beg and Mst. Feroze Fatima Begun. In face. of the provision ;nude in this section, it cannot he argued that Court has no power tee order specific performance when there is a compensation clause in an agreement regarding transfer of immovable property, for, there is nc) estoppels against plain provision of a statute. In view of section 20 of Specific Relief Act, it cannot therefore, be successfully argued that merely because a compensation clause has been provided in the Iced and there is absence of clause for specific performance there can be no specific performance of the contract for irarnsfer of the immovable property." Dealing with the provision of Section 21(a) of the said Act, it was held that this ‑section cannot be pressed into service because Mirza Tasawar Ali Beg appellant has miserably failed to adduce any evidence that the suit for specific performance should not be decreed because the sum mentioned in the deed of agreement is an adequate compensation.

8. We have carefully examined the findings of the High Court in the light of the arguments of the learned counsel for the appellants and are of the view that the learned Judges have placed correct interpretation on the above provisions and support was also rightly sought from the cases reported in A I R 1926 Mad. 144 and 1977 S C M R

225. In view of the above, the findings of the Courts below to the extent of the sale of the share of Mirza Tasawar Ali Beg in the disputed house is upheld.

9. So far as the sale of the share of Mst. Feroze Fatima appellant is concerned, as already stated, the Courts are at variance in her case. Whereas the learned trial Court after scanning the whole evidence, came to the conclusion that not only Mirza Tasawar Ali Beg did not have any authority from his wife to enter into an agreement to sell her share in the said house but that she repudiated the same at the first opportunity. On the other hand the learned Judges of the High Court have held that in the first instance Mst. Feroze Fatima appellant had in fact authorised her husband to enter into an agreement to sell her share in the property and further that by her own subsequent conduct ratified the said deed of ,agreement. On our analysing the whole case, we find that the conclusions arrived at by the learned trial Court are in consonance with the evidence so recorded. Admittedly the disputed house was owned by the husband and wife (the appellants) in equal shares. Admittedly again Mst. Feroze Fatima was not the signatory of the deed of agreement, (Exh.P.l) to sell, nor the said document had liven signed by Mir7a Tasawar All Beg on her behalf as duly authorised agent. No documentary or oral evidence was produced at the trial by Abdur Rashid Khan, respondent No.l, that Mst. Feroze Fatima had in any way ratified the agreement to sell entered into by her husband. As against this the evidence on the record is chat she on the first opportunity, disapproved the sale transaction entered into by leer husband letter, dated 10‑3‑1970 which probably was the first letter in the s.ries referred. Thereafter when the case was taken to the Court by respondent No.l, she in her written statement which was submitted on 5‑11‑1970, her better statement, dated 27‑11‑1971 and in her statement at the trial recorded on 27‑9‑1972 in most unambiguous words refused to have ever permitted her husband to enter into any transaction of sale of her share in the house. She not only denied the execution of any power of attorney in favour of her husband but also denied the existence of any deed of agreement to sell her share in her written A statement as well as in her statement at the trial. The perusal of the receipt,.dated 4‑2‑1970 (Exh.P.2) also shows that she was not a party in receiving the earnest money and this receipt was signed by her husband alone. Moreover Abdur Rashid khan, respondent No.l, knew fully well that Mst. Feroze Fatima, . a Tardanasheen lady, was the owner of half share in the disputed house and it was given out in the deed of agreement that Mirza Tasawar Ali Beg had the permission of his wife to sell the suit house, therefore, it was incumbent upon the vendee/respondent No.l, to have insisted upon the production of the said 4 ermission at the time of the execution of the agreement to sell. This not having been done fully justified the trial Court in holding that Mirza Tasawar Ali Beg had not authority or power on behalf of his wife to enter into any agreement to sell and that in any case she had repudiated the so‑called agreement.

10. The view, therefore, that we take in the matter is that Mst. Fero7x I atima had neither authorised her husband to enter into the deed of agreement nor had ratified the deed, dated 4‑2‑1970. The authorities reported in 1915 Indian Cases page 135; 1921 Indian Cases Page 768; A I R 1919 Mad. 343; A I R 1930 Mad. 476; A I R 1936 Cal. 87 and A I R 1943 P C 66 relied on and cited by the learned counsel for respondent No.l are clearly distinguishable.

11. As a result of the above, both the appeals are allowed, the impugned orders are set aside and the judgment and decree of the learned Civil Judge, 1st Class, Lahore, dated 13‑11‑1972 is restored with proportionate cost throughout. AA./T‑35/S Appeals allowed.