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Petitioner: Messrs AL-AHRAM BUILDERS LIMITED VS Respondent: PAKISTAN DEFENCE OFFICERS' JUDGMENT
Court Name: Sindh High Court Judge(s): Muhammad Shafi Siddiqui Title:Messrs AL-AHRAM BUILDERS LIMITED vs PAKISTAN DEFENCE OFFICERS'
JUDGMENT
Reported As: PLD 2015 Sindh 261 Result: Suit decreed Judgment JUDGMENT ' MUHAMMAD SHAFI SIDDIQUI, J.---This suit for specific performance ,is filed by the plaintiff against Pakistan Defence Officers Cooperative Housing Society Limited, which was then formed under the provisions of Cooperative Societies Act, 1925. 2. That the plaintiff being private limited company on 14-4-1973 has offered to purchase a plot of land bearing No,3-AA measuring 2846 square yards situated in Phase-II of the Society for construction of Super Market and Multi-Storeyed apartment on terms specified and has forwarded a pay order of Rs,33,000 dated 11-4-1973 drawn on Habib Bank Limited. On 15-5-1973 the plaintiff sent another letter in continuation wherein the price was revised for the aforesaid plot. 3. It is pleaded by plaintiff that on 28-5-1973 the defendants accepted the aforesaid letter of offer and accepted the pay order, and subsequently it followed by issuance of a certificate dated 2-7- 1973 specifying therein the permission granted to the plaintiff for putting up a sign board by the plaintiff. Learned counsel contends that in pursuance of such acceptance the plaintiff started preparing scheme and invested huge sums of money. Subsequently, the plaintiff contends that the defendants came up with an idea that Super Market with parking space alone shall be constructed on the subject plot, which letter was replied on 10-10-1973 for its reconsideration, however, the earnest money was returned. 4. On this return of earnest money, the plaintiff sent a notice under section 70 of Cooperative Societies Act, 1925 followed by Suit for Declaration and Injunction which was subsequently withdrawn on account of the approval of Super Market and Multi- Storeyed apartment vide letter dated 17-6-1974 which was intimated by the Managing Committee of the defendant. The said
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permission was conditional subject to withdrawal of the suit. Such suit was withdrawn and the defendants were intimated vide letter dated 18-7-1974. 5. That after the withdrawal of the suit learned counsel contends that the plaintiff requested to execute a lease keeping in mind that after construction of apartment and market further sub leases were to be executed to the buyers which request was not adhered to. The plaintiff also vide letter dated 22-4-1075 enclosed a pay order of Rs,2,87,446 towards full payment of the subject land which was returned by the defendants with the observations that the entire transaction stood cancelled, relying on letter dated 7/10-4-1975 which plaintiff claimed to have never received. 6. That again on 5-5-1975 the plaintiff served notice under section 70 of the Cooperative Societies Act, 1925. Subsequently a meeting was arranged between plaintiff and the defendants and the defendants agreed to withdraw their illegal termination and cancellation and agreed to a time period of two years for the completion of Super Market and Multi-Storeyed apartment subject to exclusion of three months extended period. Learned counsel submits that in fact said period was to commence from the date of approval of the plan by the competent authority and handing over vacant possession of the plot which terms were incorporated in the registered letter dated 10-3- 1976. Learned counsel for the plaintiff submit that subsequently, on 4-11-1976 the pay order in the sum of Rs,2,87,446 dated 22-4-1975 was returned for revalidation which was revalidated on same date along with covering letter dated 4-11-1976. It is contended that the said pay order encashed by the defendants being full price of the subject plot and receipt was dispatched to the plaintiffs on 16-12-1976 followed by the allotment order dated 27-1-1977. It is further contended that the plaintiff reminded on 28-5-1977 for the issuance of site plan and hand over of vacant possession of the said plot and to get the 'C' lease registered. It is claimed that possession of subject plot was handed over on 7-6-1977 however; the 'C' lease was not yet executed at the relevant time when the possession of the subject plot was handed over. It is averred that the plaintiff on 14-7-1977 forwarded such plans to the Karachi Cantonment Board and were pending on account of the execution of the 'C' lease despite issuance of several reminders and notices, ultimately a legal notice was then on 3-7-1979 with a request for execution of the aforesaid 'C' lease. However, it is contended that on 28-8-1979 the plaintiff was intimated that the allotment of the subject plot was cancelled and the payment was being refunded which was again followed by a legal notice on behalf of the plaintiff on 3-9-1979. Hence the plaintiff yet again served a notice under section 70 of the Cooperative Societies Act, 1925 followed by this Suit for Specific Performance. 7. After the service of notices and summons, the defendants filed their written statement wherein they have taken some preliminary objections that the suit as framed and filed is misconceived. It is contended that the Pakistan Defence Officers Cooperative Society stood dissolved with effect from 9-8-1980 and instead of Society an Authority as Pakistan Defence Officers Housing Authority was established under Pakistan Defence Housing Officers Society Act, 1980 which authority succeeded all the rights and obligations of the dissolved society. Learned counsel for the defendants submits that the Managing Committee of the said society had approved the plot in question only for construction of Super Market. He added that Annexure C & D to the plaint were not issued by the lawful authority nor were in accordance with the Bylaws or decision of the then committee and the Senior Engineer was not competent to issue letter such as Annexure C & D dated 28-5-1973 and 2- 7-1973 respectively. It is contended that the Managing Committee at the relevant time when it was functioning had not accepted offer of the plaintiffs for the construction of Super Market along with Multi-Storeyed apartment and neither any permission to display the sign board to the above effect was granted and if at all such permission was granted it was without any authority and is in violation of the decision of the Managing Committee. 8. Learned counsel argued that on realizing mistake, the Senior Engineer issued letter dated 17-9- 1973 and 16-12-1973. It is pleaded that the plaintiffs have managed to obtain the letters C & D
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referred above in collusion. He further submitted Annexure-H to the plaint which is a letter dated 17/18-7-1974 has no legal effect and on realizing the mistake and error on the part of Senior Engineer the letters dated 7/10-4-1975 and 28-4-1975 were issued and the pay order was returned. Learned counsel for the defendants has submitted that the Senior Engineer was neither competent to restore the allotment nor in any case competent for the registration of the lease of the plot in question and that the encashment of pay order and issuance of the receipt was unlawful act on the part of the Engineer without sanction and approval of the Managing Committee. 9. He submits that without execution of lease neither any Site plan could be given nor vacant possession could be handed over. It is contended that by illegal means the plaintiff obtained the purported handing-over taking-over certificate. However, he maintained that the possession of the plot in question at the relevant time was with the dissolved society and it continued to remain with Pakistan Defence Housing Officers Society. Learned counsel submits that the allotment in question was rightly cancelled and the amount refunded as the payment made by the plaintiff was not in accordance with the schedule of the payment and they failed to get the long term lease by 28-7- 1979 as the building was required to be completed within the stipulated period. 10. Learned counsel relied upon PLD 2005 Karachi 188 with regard to the allotment obtained by fraudulent means. Learned counsel submitted that the plaintiffs hence in view of the above are not entitled to the specific performance of the execution of 'C' lease as claimed in the instant suit. It is contended that the plaintiffs were not interested in the plot in question for themselves but only for the construction of Super Market and Flats to be given to public concerned. It is also contended that in view of the above, plaintiffs are also not entitled to claim damages and no cause of action has accrued to the plaintiffs., 11. On the basis of pleadings, the following issues were framed on 5-3-1989:-- (1) Whether the letter of acceptance dated 28-5-1973 (Copy annexure 'C') accepting plaintiff's letter of offer dated 14-4-1973 (Copy annexure 'A') for purchase of Suit plot and for construction over it of a Super Market and a Multi- Storeyed Building, was not issued with Lawful authority or was issued in violation of the Bye Laws or was issued by the Senior Engineer was not competent to issue the same? (2) Whether the Certificate dated 2-7-1973 (Copy annexure 'D') granting permission to the plaintiff to put his signboard at the suit plot, was issued without lawful authority by the Senior Engineer who was not competent to issue the same? (3) Whether Managing Committee of the Pakistan Defence Officers Cooperative Housing Society Limited, under the letter dated 28-5-1973 accepted offer of the plaintiff for purchase of the suit plot bearing No 3-AA National High Way at Karachi only for the limited purpose of plaintiff's constructing a Super Market over it? (4) Whether the said Housing Society induced the plaintiff to withdraw his suit for declaration etc. In consideration of getting approval for construction of a multi-storeyed apartments building over the suit plot? (5) Whether defendant issued the allotment order dated 27-1-1977 after realizing amount of the pay order dated 22-4-1975 and after getting the said Pay Order revalidated? (6) Whether possession of suit plot continued to remain with the defendant despite obtaining of certificate of handing over and taking over, about it by the plaintiff through illegal means and without lawful authority? (7) Whether cancellation of the transaction about sale of the suit plot to the plaintiff by the defendant, was illegal, void, unjustifiable and improper? (8) Whether the defendant agreed to withdraw cancellation of the transaction? (9) Whether the acts of the parties constituted a contract to be specifically enforced? (10) Whether the suit is not maintainable and bad in law?
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(11) Whether the Senior Engineer and the Secretary of the defendant Society are in collusion with the plaintiff? (12) Whether this suit is not properly valued? (13) What should the decree be? 12. Apart from above issues, two more additional issues were framed, which are as under:-- Additional Issue No,1 framed on 12-2-1989. ' Whether the defendant had violated the ad-interim injunction order dated 27-11-1979, confirmed on 17-5-1981? Additional Issue No, 2 framed on 17-11-2003. ' Whether the suit has been instituted by the authorized person? If not, what is the effect? 13. After the settlement of issues, the matter was fixed for recording evidence. The plaintiff has examined its Managing Director, Syed Abid Ali Zaidi, as Exh.5, whereas defendant has examined its Deputy Director Land, namely, Major (Rtd.) Moeenuddin Humayon as Exh.6. 14. I have heard the learned counsel and perused the material available on record including the evidence adduced by the parties. My findings, on the above issues with reasons are as under:- FINDINGS Issues Nos.1 and 11 In negative Issue No,2 In negative Issue No,3 In negative Issue No,4 In affirmative Issue No,5 In affirmative Issue No,6 In negative Addl. Issue 1 Answered accordingly Issues Nos.7 and 8 In affirmative Issue No,9 In affirmative Issue No,10 In negative Addl. Issue 2 In affirmative Issue No,12 Already answered. Issue No,13 Suit decreed REASONS Issues Nos.1 and 11. 15. These issues can be dealt with together. The burden to prove that the subject letters of acceptance (dated 28-5-1973) in reply to plaintiff's letter of offer dated 14-4-1973 was not issued by the competent authority, was on defendant since it is claimed that such acceptance was in violation of DHA bylaws as mentioned in paragraph 5 of the written statement. The witness of defendant in his affidavit-inevidence has asserted that:-- "the allotment letter purportedly signed by the Senior Engineer is a forgery as the said officer was not authorized to sign the allotment letter." 16. This assertion of the witness, as incorporated in his affidavit-inevidence, is contrary to the written statement as well as to other portions of the evidence of Major (Rtd.) Moeenuddin Humayon. It is admitted in the written statement in para 4 that the allotment of the subject plot having been approved by the Managing Committee of the dissolved society. Similarly, in the cross- examination the witness has also stated as under:-- "(a) The plot was allotted to the plaintiff under the decision of the Managing Committee of defendant authority. (b) The plot in question was allotted to the plaintiff for the purpose of construction of super market at the price of Rs, 101 per sq. Yard initially. I see Exh.5/19 and it is correct to suggest that it is
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not mentioned in the said exhibit that the plot in question will be used for super market, however, the plaintiff was required to submit building plan approved by the defendant authority." 17. The plaintiff throughout is consistent regarding the offer and the acceptance in terms of Exhs.5/1 and 5/2. Similarly, the allotment order itself (Exh.5/19) dated 27-1-1977 is also clear in its terms. Such allotment order is not questioned as it has been undisputedly issued and signed by the then Secretary of the defendant pursuant to the meeting of managing committee. Though it is not relevant for this particular issue but the handing- over and taking-over certificate dated 7-6-1977 is not only signed by the Planning Officer/Executing Engineer, Draftsman and Chief Engineer of the defendant, but also bears counter-signature of the then Secretary who had issued the allotment order in pursuance of the Managing Committee's decision dated 25-5-1973. It is also very important factor that the plaintiff has been writing since 14th April, 1973 and on 4-11-1976 (Exh.5/6) the defendant was pleased to encash the Pay Order submitted to them along with letter dated 4- 11-1976 (Exh.5/17). These correspondence such as Exhs.5/1, 5/2, 5/3, 5/4, 5/6 and so on till the issuance of the allotment order were not denied by the witnesses. There is no cavil to this submission that the power to sell or let-out the property was vested with the Managing Committee and it was only the decision of the Managing Committee which was forwarded and communicated through Exh.5/3 and it was not the unilateral decision of the Senior Engineer who signed the said letter. There is a difference between the acceptance of the proposal and the issuance of letter confirming the acceptance by the competent authority, which has been done in this case. Thus, Exh.5/3 is in fact a communication of the decision, not the decision itself. Such statement and assertion that the plot was allotted by the Managing Committee was always a stand in the pleading/written statement as well as in the plaint, as highlighted above. Thus, since the acceptance of offer and the allotment is established, therefore, the communication of decisions in this regard cannot become a basis of violating any terms or bylaws. It may be submitted that in terms of doctrine of indoor management the plaintiff cannot be made to suffer for any deficiency on the part of defendant to follow the informal procedure internally adopted by it. If any reference is required one may look at the decisions reported in Pechs v. Mst. Anwar Sultana (PLD 1969 Karachi 474 relevant page 289), UBL v. Pak Wheat Products Limited (PLD 1970 LAHORE 235 relevant page 248). The issues Nos.1 and 11, therefore, are decided in negative. Issue No,2. 18. The certificate dated 2-7-1973, annexure "D" to the plaint and Exh.5/5 also reflects the same storey and the burden lies upon defendant. ' This issue is all about fixation of the signboard at site as site for super market and multi-storyed apartments etc. This permission appears to be in consonance and in line with the above acceptance and the signboard only reflects such decision of managing committee. The revised offer vide letter dated 15-5-1973 is prior to acceptance. The restriction against the Construction of upper storeys regarding its height was communicated by the defendant No,1 for the first time through letter dated 17-9-1973 (Exh.5/6), thus the certificate dated 2-7-1973 (Exh.5/5) was issued at the time when DHA had not decided to restrict the number of storeys proposed to be constructed on the subject plot. 19. It is also significant that most of the correspondence on behalf of defendant was done under the signatures of its Senior Engineer. The letter dated 17-9-1973 (Exh.5/6) and letter dated 16-12- 1973 (Exh.5/8) through which Pay Order of earnest money was returned to the plaintiff had also been signed by the same officer on behalf of the defendant. The defendant by these contradictory pleadings disown certain documents issued by the Senior Engineer, which did not find favor for them while relying on number of other correspondence signed by the same officer on behalf of the defendant which find favor for them. This is not only apparently mala fide but also inconsistent stand. The Secretary apparently has signed four documents i,e, Exh.5/9, 5/19, 5/20 and 5/32,
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whereas rest of the correspondence was made by their authorized persons including Senior Engineer on behalf of the defendant. The defendant thus cannot be allowed to approbate and reprobate in the same breath. It thus cannot be said that such certificate dated 2-7-1973 was issued without lawful authority. Issue No,2 is also decided in negative. Issue No,3. 20. The burden to prove this issue is also on the defendant. The defendant in paragraph 8 of its written statement has averred that the plaintiffs were, aware that on the plot in question only a Super Market had to be constructed and not the Multi-storeyed apartments." The above allegation is contradicted by documentary evidence contained in the letter of offer dated 14-4-1973 (Exh.5/1) and the revised offer dated 15-5-1973 (Exh.5/2). The plaintiff had clearly offered the price for construction of Super Market with multi-storeyed apartments thereon. The defendant has not produced minutes of meeting dated 25-5-1973 of its Managing Committee when the revised offer of plaintiff was accepted. 21. Indeed the request for the production of such documents should have come from plaintiff's side, however, the defendant being burdened to prove critical and important issues and in possession of the record of meetings of Managing Committee has chosen not to produce the same for discharge of burden. The failure on the part of plaintiff to have summoned the defendant's witness for production of said documents is not as fatal as it is for defendant under Article 129. The presumption in terms of Article 129(g) of Qanun-e-Shahadat Order, 1984, therefore, will be to the effect that production of such minutes would have negated the case of defendant. The defendant has nowhere denied that the Managing Committee held meeting on 25-5-1973 and resolved to allot the subject property to the plaintiff despite clear offer in letters referred above. When there are two presumptions and both are equally claimed to be balanced, a Court must yield for one which best accords with facts. When evidence which could matter, if not produced, especially by party relying on it, the inference is that if produced, it would be unfavorable to the person who withholds it. In order to raise presumption under Article 129(g) it is not necessary to follow the procedure of giving a notice for production of documents under Order XI, C.P.C. Or to summon the documents under Order 16, C.P.C. The only important condition laid down is that party should prove that the document is in existence and is in possession of opposite party against whom inference is to be drawn. In this case decision of managing committee is admitted but for reasons best known to defendant, has not produced the same. The letter of acceptance dated 28-5-1973 (Exh.513) and the letter dated 17-6-1974 (Exh.519) leave no doubt that construction of multi-storeyed building over the subject property was not prohibited by the Managing Committee, initially. It is pertinent to mention that the letter dated 17-6-1974 (Exh.5/9) is signed by Secretary of the defendant and not by its Senior Engineer. It is true that acceptance of terms of letter dated 17-6-1974 (Exh.5/9) by the plaintiff through its reply dated 18th July, 1974 (Exh.5/ 10) amounts to waiver of claim for construction of more than six upper floors consisting of apartments. The letter of acceptance dated 28-5-1973 (Exh.5/3) does not purport to limit construction over the subject plot merely up to ground floor. Since the decision of managing committee is admitted, therefore, provisions of Article 103 of Qanun-e-Shahadat Order; 1984, would come to rescue as it prohibits any evidence being admitted in contravention of the document. This issue, therefore, is decided in negative. Issue No,4. 22. The burden to prove this issue is upon the plaintiff who has averred in paragraphs 11, 12 and 13 of the plaint that on account of return of pay order through letter dated 16-12-1973 (Exh.518) the plaintiff had resorted to proceedings under section 70 of the Cooperative Societies Act, 1925 and filed a suit for declaration and injunction against the defendant. It is further averred that the defendant had subsequently approved revised scheme for construction of Super Market and multi-storeyed building thereon through letter dated 17-6-1974 (Exh.519) subject to the condition of
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withdrawal of civil proceedings filed against it. The plaintiff, as per paragraph 13 of the plaint, had unequivocally accepted the offer contained in the said letter dated 17-6-1974 (Exh.519) and further withdrew the proceedings initiated by it. Although, the details of civil suit for declaration and injunction have not come on record during evidence but such averment has been reaffirmed by the plaintiff's witness in his deposition (Exh.5). There is nothing from the side of defendant to controvert the above assertion. The effect of above is that the defendant is estopped in law from turning its back and resiling from the commitment made through the letter dated 17-6-1974 (Exh.5/9). Reference can be drawn from the judgment pronounced by Hon'ble Supreme Court of Pakistan dated 2-9-1981 passed in Civil Appeal No,K-82 of 1972 (Syed Hamid Rehmani and 7 others v. Hussain Bhai and 27 others) in the following terms:- "10. The four principles recognized for giving effect to estoppel, and relevant for the purposes of this case are, firstly that the fact recited should be essential for the deed creating the rights and obligations; secondly the suit must be based on the deed or concerning a right and of it; thirdly that it should have prompted the other side to an action to its prejudice; and fourth that the estoppel should not be utilized for snaking something legal which in fact, is illegal, offending against a statutory provision concerned with public policy," 23. Applying the above principle, the defendant is estopped in law from what they have pleaded as against facts came through letter dated 17-6-1974 (Exh.519). To put it in different words, no locus poenitentiae was left in the defendant to avoid implementation of the contract for transfer and lease of the subject plot in favor of plaintiff. The issue, in view of the above, is answered in the affirmative. Issue No,5. 24. The burden to prove this issue is on the plaintiff who has alleged in the plaint that Allotment Order dated 27-1-1977 (Exh.5/19) was issued in its name by the defendant after payment of entire price of the subject property in the sum of Rs,287,446.00 through pay order. The plaintiff's witness has produced letter dated 10-3-1976 (Exh.5/15) which was addressed to the Secretary of the defendant and reads as under:- "We shall be obliged if our request is considered favorably. In the meantime we are pleased to enclose herewith our Pay Order No, OAF 917344 dated 22nd April 75 for Rs,287,446 in full and final payment of the price of the subject plot. Kindly acknowledge the receipt." 25. Though this letter is not denied but as a proof of dispatch and delivery of the said letter the plaintiff .Has produced postal receipt as Exh.5/15/2 and the…
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