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Petitioner: Ishtiaq Saleem VS Respondent: Syed Zulfiqar Ali Shah (deceased) through L.Rs & others
Court Name: Lahore High Court Judge(s): Ahmad Nadeem Arshad Title: Ishtiaq Saleem vs Syed Zulfiqar Ali Shah (deceased) through L.Rs & others Case No.: Civil Revision No.618-D of 2009/BWP Date of Judgment:2023-04-28 Reported As: 2023 LHC 2369 Result: Petition Dismissed
JUDGMENT
JUDGMENT AHMAD NADEEM ARSHAD, J. This civil revision is directed against the judgment and decree of learned appellate court dated 21.02.2009 whereby while accepting the appeal of respondents decreed their suit for specific performance of an agreement to sell. 2. Briefly, the facts, forming factual canvass of this revision are that plaintiffs/respondents (hereinafter referred to as "respondents") instituted a suit for specific performance on 06.01.2003 against the defendant/petitioner (hereinafter referred to as "petitioner") by maintaining that petitioner agreed to sell his land measuring 09-kanals bearing Khata No.6, rectangle No.306/3, killa No.25 measuring 06-kanals 11-marlas and rectangle No.306/4, killa No.5 measuring 02-kanals 09- marlas, situated at Chak No.19-A Tehsil Liaqat Pur District Rahim Yar Khan (hereinafter referred to as "suit property"), for a consideration of Rs.3,50,000/- and after receipt of Rs.100,000/- executed an agreement to sell dated 13.06.2002; that respondents remained ready to perform their part but the petitioner failed to abide by his commitment which constrained them to institute the suit. The petitioner resisted their suit through filing contested written statement on 13.06.2003 by raising preliminary objections that respondents have no cause of action; that petitioner transferred the suit property through mutation No.476 dated 04.01.2003 to Abrar Murtaza etc.; that agreement to sell dated 13.06.2003 was cancelled due to non-performance of the conditions as respondents failed to pay the remaining consideration amount within stipulated time and became defaulter; that the petitioner issued a written notice on 18.09.2002 to the respondents to pay remaining consideration amount within two days otherwise sale bargain will be deemed to be cancelled but neither the respondents replied to the said notice nor paid remaining consideration amount,
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therefore, agreement has been cancelled. While replying on facts admitted the execution of agreement to sell, however reiterated the same stance pleaded in the preliminary objections. After submission of written statement petitioner absented from the court proceedings, therefore, ex- parte proceedings were initiated against him on 11.11.2004. Respondents were asked to produce their ex-parte evidence. Learned trial court after recording ex-parte evidence of the respondents dismissed their suit vide judgment and decree dated 19.10.2007 on the grounds that they failed to establish on record that they remained ready to perform agreement to sell in letter and spirit and that inspite of the fact petitioner alienated the suit property to Abrar Murtaza etc. through mutation No.576 dated 04.01.2003, they did not make them party. Feeling aggrieved, respondents preferred an appeal. Petitioner appeared before the learned appellate court but again absented himself from the court proceedings, therefore, ex-parte proceedings were initiated against him and the learned appellate court after providing opportunity of hearing to the respondents accepted their appeal, set aside the judgment and decree of learned trial court and decreed their suit vide impugned judgment and decree dated 21.02.2009. Being dis-satisfied, petitioner approached this Court through the instant revision petition. 3. Learned counsel for the petitioner submits that while decreeing the suit, the learned appellate Court did not consider that respondents failed to pay the remaining consideration amount within due time as per agreement and they failed to abide by their commitment as per agreement to sell, therefore, they were not entitled for the decree of specific performance which otherwise being discretionary relief could not be claimed by anybody as a right. Further adds that in the legal notice the petitioner asked the respondents to deposit/pay the balance amount of consideration within two days but they failed to do so which fact on the one hand speaks volumes about the bona fide of the petitioner towards completion of the contract and on the other hand proof of inaction on the part of the respondents towards payment of the balance amount. Argues that according to the latest view of the superior courts, the intent of the vendees to complete the agreement between the parties is discernable from their readiness to deposit the balance amount with the Court at the time of filing of suit for specific performance but the respondents did not do so until and unless they were compelled by the Court in that regard. Contends that at the most the respondents were entitled for return of the paid amount but by no stretch of imagination they were entitled for a decree of specific performance. In support of his contentions, learned counsel for the petitioner has relied upon the cases reported as "HAMOOD MEHMOOD versus Mst. SHABANA ISHAQUE and others" (2017 SCMR 2022), "SALMA Bibi and others versus Rana SAGHEER HUSSAIN" (PLD 2022 Lahore 589), "MANZOOR HUSSAIN versus Haji KHUSHI MUHAMMAD" (2017 CLC 70), "LIAQAT ALI Khan and others versus FALAK SHER and others" (PLD 2014 Supreme Court 506), "Haji ABDUL KARIM and others versus Messrs FLORIDA BUILDERS (PVT) LIMITED" (PLD 2012 Supreme Court 247), "BOARD OF GOVERNORS, AREA STUDY CENTRE FOR AFRICA AND NORTH AMERICA, QUAID-E-AZAM, UNIVERSITY, ISLAMABAD and another versus Ms. FARAH ZAHRA" (PLD 2005 Supreme Court 153), "HAFEEZ Ahmad and others versus CIVIL JUDGE, LAHORE and others" (PLD 2012 Supreme Court 400), "NASIR ALI versus UMAR DRAZ and others" (PLD 2011 Lahore 599), "ILAM DIN versus HASSAN DIN and others" (PLD 2006 Lahore 121), "HYDERABAD DEVELOPMENT AUTHORITY through M.D. Civic Centre, Hyderabad versus ABDUL MAJEED and others" (PLD 2002 Supreme Court 84), "Miss KIRAN ARIF MIAN versus Miss KINZA KHALID and another" (PLD 2008 Islamabad 11), "REHMATULLAH and others versus SALEH Khan and others" (2007 SCMR 729), "ABDUL GHANI versus Mst. SHAHEEN and others" (2007 SCMR 834) and "MUNIR Ahmad and 7 others versus BASHIR Ahmad ANJUM and 2 others" (PLJ 2007 Lahore 1109). 4. Conversely, learned counsel appearing on behalf of respondents, while defending the impugned judgment and decree, argues that since the cut-off date for final payment was 31.10.2002, the statements of PWs got recorded by his clients show that they were remained ready for payment of
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outstanding consideration amount, thus, the assertion of the learned counsel for the petitioner cannot be given any weightage; that in a suit for specific performance instead of deposit of cash in the court, the capacity of the vendees has to be judged by the Court and when P.W-4 Zulfiqar Ali one of the respondents while recording his statement categorically stated that they are ready to pay remaining consideration amount of Rs.2,50,000/-, no illegality was committed by the learned appellate Court while decreeing the suit; that bona fide and readiness of the respondents to perform their part of the contract in the shape of payment of balance amount is also evinced from their evidence; that they were ever ready to pay the balance consideration amount; that since the respondents deposited the balance amount before the Court, no adverse opinion could be formed against them on the ground that they did not do so at the time of filling of the suit as they could not deposit the amount without permission of the Court; that prompt filing of the suit by the respondents within two months and six days from the date of payment of last installment speaks volume about the fact that they were ever ready to perform their part of contract; that even during the evidence PW-4 stated in clear cut words that respondents were ready to pay the balance amount upon execution of formal sale deed by the petitioner in their favour. To fortify his contentions, learned counsel for the respondents has relied upon the cases reported as "PROVINCE OF PUNJAB and others versus MUHAMMAD IQBAL and others" (2010 YLR 2759), "Malik YARAN Khan versus CHIEF LAND COMMISSIONER, PUNJAB, LAHORE" (2012 MLD 78), "Begum Syeda AZRA MASOOD versus Begum NOSHABA MOEEN and others" (2007 SCMR 914), "GHULAM HUSSAIN RAMZAN ALI versus COLLECTOR OF CUSTOMS (PREVENTIVE), KARACHI" (2014 SCMR 1594), "Messrs BLUE STAR SPINNING MILLS LTD. versus COLLECTOR OF SALES TAX and others" (2013 SCMR 587), "MUHAMMAD LATIF Khan and 17 others versus MUHAMMAD RASHEED Khan and 63 others" (2012 MLD 86), "HAFEEZ Ahmad and others versus CIVIL JUDGE, LAHORE and others" (PLD 2012 Supreme Court 400), "LAHORE DEVELOPMENT AUTHORITY versus Mst. SHARIFAN Bibi and another" (PLD 2010 Supreme Court 705), "ABDUL QADIR and 2 others versus JAHANGIR Khan and others" (2022 SCMR 321) and "PROVINCE OF PUNJAB and others versus MUHAMMAD ARIF AND COMPANY" (PLD 2022 Lahore 596). 5. I have heard the learned counsel for the parties at full length and also gone through the record minutely with their able assistance. 6. Admittedly suit property belonged to the petitioner who purchased the same through mutation No.518 dated 08.01.2001. There is no dispute that petitioner agreed to sell the suit property to respondents through agreement to sell dated 13.06.2002 for consideration of Rs.3,50,000/- and after receipt of Rs.100,000/- executed a receipt on the same day in this regard. Although petitioner did not deny the execution of agreement to sell and receipt of earnest money but the respondents to prove their contentions produced Bakht Ali Scriber as P.W-1 who deposed that he on the asking of petitioner had written an agreement to sell with regard to the suit property in favour of respondents and receipt of Rs.100,000/-. He further deposed that said agreement to sell Exh.P-1 is written and signed by him and said document was entered by him in his register at Sr. No.17 on 13.06.2002. He also deposed that receipt Exh.P-2 was also written and signed by him. He further deposed that petitioner also put his signature and thumb impression on his register and also got incorporated his identity card number. He maintained that he read over both the documents to the petitioner, respondents and attested witnesses who after understanding the same signed it. Respondents produced Ch. Muhammad Tufail attesting witness as P.W-2 and Muhammad Bashir attesting witness as P.W-3. Both the witnesses stated that Exh.P-1 and Exh.P-2 were written before them and they put their signatures and also identified their signatures. One of the respondents namely Zulfiqar Ali appeared as P.W-4 and deposed in the same lines as pleaded in the plaint. All the said witnesses were not cross-examined due to ex-parte proceedings initiated against the petitioner. In documentary evidence respondents produced agreement to sell along with copy of
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national identity card of the petitioner as Exh.P-1, receipt of Rs.100,000/- as Exh.P-2, copy of record of rights for the years 2002-03 as Exh.P-3. This documentary evidence also remained un-rebutted. 7. Petitioner took a specific stance that agreement to sell dated 13.06.2002 was cancelled due to non-performance of the conditions because respondents failed to pay remaining consideration amount as per terms of the agreement within time, therefore, time is essence of the contract. He also pleaded that in this regard he sent a notice dated 18.09.2002 through registered envelope acknowledgement due to the respondents wherein he specifically asked them if they failed to pay remaining consideration amount within a period of two days, sale bargain shall be deemed to be cancelled. The petitioner failed to produce any such notice before the learned trial court. There is no cavil with the proposition that pleadings are not evidence themselves and the facts pleaded in the pleadings should be proved through evidence. 8. Now question for determination is whether time was the essence of contract or not, same can be deciphered from the recital of agreement to sell between the parties. For convenience of reference, agreement executed between the parties on 13.06.2002 is reproduced in verbatim as under:- 9. Perusal of said agreement to sell, although it does state that remaining consideration amount of Rs.100,000/- was to be paid in the 1st week of August, 2002 and Rs.1,50,000/- was to be paid on 31.10.2002 and in case of failure the sale bargain was to be cancelled and earnest money be forfeited. It is also evident from the said document that it is a unilateral agreement and written on behalf of the petitioner and the signatures/thumb impressions of respondents are missing on it. 10. However, by now it is well-settled that what is to be determined in such like cases is not the form of document but the intention of the parties i.e. that time should be of essence of the contract. It is well-settled principle of law that in contracts relating to immovable property time is not essence of contract. In this regard the observation of Lord Viscound Halodone in "Jamsheed Rhoda Ram Irani V. Bujrgi Dhunni Bhi" (AIR 1915 Privy Council 83 at Page 85) is relevant, which is as under:- "Prima facie, equity treats the importance of each time limit as being subordinate to main purpose of the parties and it will enjoin specific performance notwithstanding that from the point of view of court of law the contract has and been literally performed by the plaintiff as regards the time limit specified." In case of "Abdul Hamid v. Abbas Bhai" (PLD 1962 Supreme Court 1) it has been held while interpreting Section 55 of the Contract Act, 1872 by the Honorable Supreme Court of Pakistan as under:- "An intention to make time of the essence of the contract must be expressed in unmistakable language; it may be inferred from what passed between the parties before, but not after, the contract is made." It was also laid down in that case that:- "Equity will not assist where there has been undue delay on the part of one party to the contract, and the other has given him reasonable notice that he must complete within a definite time." In case reported as "Seth ESSABHOY versus SABOOR AHMAD" (PLD 1973 SC 39) the principle of law has been envisaged by the Honorable Supreme Court that:- "It is a well-settled principle of law that in contracts relating to immovable property, time is not of the essence of the contract, and the claim of the appellant, even if were accepted that he had given three days' notice to the respondent for completion of the contract, failing which it would come to an end, cannot at all be considered to be reasonable time." In case of "Ghulam Nabi and others v. Seth Muhammad Yaqub" (PLD 1983 Supreme Court 344) similar view was affirmed by the august Supreme Court. In case of "Muhammad Sharif v. Mst. Fauji alias Phaji through legal heirs" (1998 SCMR 2485) while interpreting Section 55 of the Contract Act (IX of 1872) the Honorable Supreme Court
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enunciated the principle to determine the time of the essence of contract of particular case in the following words:- "In order to determine whether, in relation to a particular contract time is, or is not of essence, intention of the parties in terms of Section 55 of the Contract Act is to be assessed." Further observed:- "Such an intention is to be gathered from the terms of contract itself, as translated by the conduct of the parties and attending circumstances. The terms themselves are to be construed with reference to the spirit and substance rather than the bare words or recitals, in a deed." Merely an express provision in agreement specifying certain time limit for performance of contractual undertaking on part of promisee/vendee in case of sale of immovable property, would not make specified time as essence of contract in absence of any such specified intendment from construction of document of contract. In the absence of a provision in the agreement to sell an immovable property that the time fixed for performance of the contract is to be treated as the essence of contract, the time fixed for performance of the contract is not treated as the essence of contract. It was so, reiterated in "Mrs. Mussarat Shaukat Ali v. Mrs. Safia Khatoon and others" (1994 SCMR 2189) that mere mention of some period or inclusion of forfeiture clause would not have an effect that time is essence of contract and "delay simpliciter which is short of period of limitation prescribed under the law is not enough to disentitle a plaintiff to the relief of specific performance." 11. It is also matter of fact that petitioner pleaded in his written statement that he gave notice to the respondents on 18.09.2002 with a direction to pay balance consideration amount within two days and said notice was given after the date of first installment i.e., first week of August, 2002. This fact also suggest that time was not essence of contract. 12. The question, which of the parties was at fault in performing its part of agreement is a question of fact and inference can only be drawn from the record. The respondents specifically pleaded in their plaint as under:- One of the plaintiffs while recording his statement as P.W-4 stated as under:- Said portion was remained unchallenged. Petitioner failed to rebut the stance of respondents, therefore, inference can be drawn that he was at fault in fulfilling the agreement. 13. There is no cavil with the proposition that where defendant found to have committed breach of contract, it is not obligatory on the part of plaintiff to prove his willingness to perform it. For reference Seth Essabhoy judgment referred supra, whereby august Supreme Court of Pakistan observed as under:- "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. In this connection, the observations of Lord Mansfield in Jones v. Barkley (1) may be usefully cited:- "The party must show that he was ready, but, if the other stops him on the ground of an intention not to perform his part, it is not necessary for the first to go farther and do a nugatory act." Where the defendant definitely repudiates the contract, or commits breach thereof, the plaintiff is absolved from showing that he was ready and willing to perform his part of the contract." (1) (178) 2 Dougl. 684 14. The failure to perform part of contract by the date fixed in the agreement to sell i.e., for payment of remaining consideration amount is not a ground for refusing relief of specific performance unless the circumstances must be highlighted and proved by the owner-vendor of the land that time is essence of the contract. Section 55 of the Contract Act, 1872 deals with the effects of the failure of a party to perform its part of the contract where time is essence of the contract and the
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contracts where the time is not the essence of the contract. For convenience of reference, the said provision is reproduced herein below:-
"Section 55. Effect of failure to perform at fixed time, in contract in which time is essential When a party to a contract promises to do a certain thing at or before a specified time, or certain things at or before a specified times, and fails to do any such thing at or before the specified time, the contract, or so much of it as has not been performed, becomes voidable at the option of the promisee, if the intention of the parties was that time should be of the essence of the contract. Effect of such failure when time is not essential---If it was not the intention of the parties that time should be of the essence of the contract, the contract does not become voidable by the failure to do such thing at or before the specified time; but the promisee is entitled to compensation from the promisor for any loss occasioned to him by such failure. Effect of acceptance of performance at time other than that agreed upon.....If, in case of a contract voidable on account of the promisor's failure to perform his promise at the time agreed, the promisee accepts performance of such promise at any time other than that agreed, the promisee cannot claim compensation for any loss occasioned by the non-performance of the promise at the time agreed, unless, at the time of such acceptance he gives notice to the promisor of his intention to do so." From above, it is vividly clear that intention to make time of the essence of the contract must be expressed in unmistakable language and it can be inferred from what passed between the parties before but not after the contract is made. A mere mention of a specified period in an agreement for completion of sale and payment of balance consideration amount would not make the time as essence of the contract unless it is expressly intended by the parties and the terms of the contract do not permit any other interpretation. This question has to be decided according to the intention of the parties reflecting in the agreement, its terms, conduct of the parties after the agreement and all the attending circumstances. Reliance is placed upon the case reported as "Mst. AMINA BIBI versus MUDASSAR AZIZ" (PLD 2003 Supreme Court 430) wherein it has inter alia been held as under:- "12.Generally speaking, specific performance of a contract of sale of immovable property has been granted by the Courts although there has been a failure to keep the dates assigned by it, if justice could be done between the parties and if nothing in (a) the express stipulation of the parties, (b) the nature of the property, or (c) the surrounding circumstances make it inequitable to grant the relief. 13. It is well-settled that intention to make time of the essence of the contract must be expressed in unmistakable language and it may be inferred from what passed between the parties before, but not after, the contract is made. A mere mention of a specified period of an agreement for completion of sale has been held as not to make the time of essence of the contract. In contracts of sale of immovable property, ordinarily, time is not considered to be the essence of the contract unless it was expressly intended by the parties and the terms of the contract do not permit of any other interpretation." Similarly, in case of "MUHAMMAD HUSSAIN and others versus. Dr. ZAHOOR ALAM" (2010 SCMR 286) the issue, under discussion, was clinched in the following manner:- "In the contract relating to immovable property time is not generally the essence of the contract in the failure to perform part of the contract by the date fixed in the agreement to sell i.e. for execution of sale deed is not a ground for refusing specific performance unless the circumstances must be highlighted and proved by the owner of the land that time is essence of the contract in view of the law laid down by this Court in various pronouncements. See Abdul Hamid's case (PLD 1962 SC 1) Seth Essabhy's case (PLD 1973 SC 39)."
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Likewise, the august Supreme Court of Pakistan in case titled "MUHAMMAD ABDUR REHMAN QURESHI Versus SAGHEER AHMED" (2017 SCMR 1696) while interpreting that whether time is essence of the contract in the real estate transactions held as under : - "It must be interpreted and applied specifically considering the facts and circumstances of each case to balance equities, keeping the standards of reasonability in mind and ensuring that injustice is not done to either side." If the question as to whether the time was essence of the agreements entered between the parties is adjudged on the touchstone of the afore-referred judgments of the Hon'ble Supreme Court there leaves no ambiguity that according to the recitals of agreement to sell (Exh.P-1), the respondents were to pay balance consideration amount in two installments. In this background, it can safely be concluded that the time was not essence of the contract. 15. There is no cavil with the proposition that it is not incumbent upon the Court to decree every suit for specific performance if the circumstances of the case require otherwise. As far as the case in hand is concerned, despite addressing the Court at length, learned counsel for the petitioner has not been able to convince me with solid reason as to why the suit of the respondents could not be decreed. It is admitted proposition that on the one hand the petitioner received Rs.100,000/- from the respondents in part performance of the contract and on the other hand retained the possession of the suit property which fact also stands proof of the fact that the petitioner was not ready to perform his part of the contract. 16. It is relevant to note that Section 22 of the Specific Relief Act, 1877 deals with discretion to grant of decree for specific…
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