AAMER SHAKIL Versus MUHAMMAD AFZAL

ABAID ULLAH KHAN, J ‑This appeal (R.F.A. No.119 of 1981) by the plaintiffs and the other appeal (R.F.A. No.154 of 1981) .by defendant 1 arising out of the same judgment and decree passed by the learned Civil Judge, Gujranwala, on the 8th January, 1981, are proposed to be dealt with and disposed of together. Muhammad Afzal, defendant 1, in the suit brought by Khwaja Aamer Shakil (plaintiff 1) and Muhammad Farooq (plaintiff 2) for possession through specific performance of contract of sale of the property in dispute bearing No.B.XXI.IS‑171‑B (once building of a factory owned by non‑Muslim evacuees and now reduced to dilapidated sheds), situate on Hafizabad Road in Gujranwala City, and in the alternative for recovery of Rs.1,50,000, was the owner of the said property. On the 8th November, 1979, Muhammad Afzal entered into agreement with the plaintiffs to sell them the property in question for Rs.1,50,000 and received earnest money of Rs.75,000: He executed the deed of agreement, EXh.P.l, in this behalf. The balance of the price was to be received by him at the time of registration of the sale‑deed. He promised to get the sale‑deed registered by the 30th April, 1980, failing which he was liable to pay penalty equivalent to the earnest money. In case the plaintiffs were not to pay the balance of the price of the purchase money and get the sale‑deed registered within the stipulated time the earnest money paid by them was to be deemed to have been confiscated and the contract of sale to come to an end. Expenses of registration were to be borne and gain tax was to be paid by the plaintiffs while outstanding dues in respect of the property were payable by defendant 1 who undertook the responsibility of procuring necessary certificates from the various departments and delivering vacant possession of the property. When the agreement of sale was concluded the property was in the possession of Ghulam Muhammad, DW 1, and one Muhammad Islam Butt.

2. The plaintiffs alleged that before the target date of the 30th April, 1980, they had asked defendant 1 many a time for getting the sale‑deed registered and for handing over the possession of the property to them but he had been putting off the matter saying that he had been trying to recover possession of the property and as soon as he would take over the possession he would get the sale‑deed registered. On the 29th April, 1980, the plaintiffs sent to defendant 1 the following telegram which he said he had received after the 30th April, 1980,‑‑

"Ready to perform our part of contract as before but you are avoiding to perform your part of contract. You have not been able to get physical possession so far. We shall be present outside the Court of Sub‑Registrar on 30th instant with money for needful. Inform telegraphically."

The plaintiffs averred that thereafter they contacted defendant 1 and repeatedly asked him that he should receive the balance of the purchase money, get. the sale‑deed registered and hand over the possession of the property to them but he had been dilly‑dallying the matter.

3. The plaintiffs blamed Noor Ahmad, defendant 2, who is the owner of the shop lying adjacent to the property in dispute, for having secretly purchased the property from defendant 1 and got the sale‑deed, Exh. DW 3/2, registered in his favour on the 14th May, 1980, though he had known full well that there existed agreement of sale of the property between them and defendant 1. They contended that after the registration of the sale‑deed the defendants arranged with the persons who had been in occupation of the property to deliver them possession. They explained that defendant 1 had approached them on a number of occasions and asked them to wash their hands off the bargain of sale by getting profit but they had not acquiesced in his proposal.

4. According to the plaintiffs when they contacted defendant 1 after he had sold the property to defendant 2 for Rs.2,75,000 the former said that as he himself was not able to get possession of the property and as defendant 2 had secured possession through his own efforts and further that as he (defendant 1) was in need of money he got the sale‑deed registered in defendant 2's favour. The plaintiffs pleaded that defendant 1 had told them that he had made it clear to defendant 2 before registration of the sale‑deed in his favour that he was purchasing the property at his own risk because his agreement of sale of the property with the plaintiffs subsisted as he had received Rs.75,000 as earnest money from them and further that he (defendant 1) had apprised him (defendant 2) of the terms and conditions of the agreement.

5. On the 16th June, 1980, the plaintiffs instituted suit for possession of the property through enforcement of agreement of sale of the 8th November, 1979, and in the alternative for the recovery of Rs.1, 50, 000 from defendant 1. They maintained that sale of the property by defendant 1 in the name of defendant 2 was void and ineffective on their rights arising out of the earlier agreement of sale in their favour. They asserted that all along they had been ready to get the sale‑deed registered according to the terms of the agreement.

6. Both the defendants contested the suit. Defendant 1 averred that he had taken over possession of the property on the 27th April, 1980, when the tenants had vacated it and that this fact was in the knowledge of the plaintiffs. He added that he had told the plaintiffs that he had taken over possession of the property and that they should purchase the stamp paper for getting the sale‑deed executed and registered but since they had no money to pay the price they had themselves got the bargain of sale settled with defendant 2 and since he was in need of money he had sold the property to defendant 2. He maintained that the plaintiffs were thus estopped by their word and deed from bringing the suit. He made mention of his presence in the office of the Sub‑Registrar, Gujranwala, on the 30th April, 1980, and said that none of the plaintiffs had turned up for getting the sale‑deed registered and that he had secured certificate of the Sub‑Registrar on his application to that effect. He denied that he had entered into conspiracy with defendant 2 or persons in occupation of the property. He laid blame upon the plaintiffs for non‑performance of their part of the contract. He objected to the maintainability of the suit in the form it had been brought.

7. Like defendant 1, defendant 2 took exception to the sustainability of the suit and pleaded estoppel against the plaintiffs. He questioned the correctness of the value of the cause for purposes of court‑fee and jurisdiction. He joined defendant 1 in saying that Ghulam Muhammad, etc., had delivered possession of the property to defendant 1 on the 27th April, 1980. He denied any knowledge of the existence of agreement of sale between the plaintiffs and defendant 1 and asserted that he was bona fide purchaser for value of the property.

8. The contentions of the parties gave rise to the following issues for determination,‑‑ ,

(1) ??????? Whether this suit is not maintainable in its present form? OPD

(2) ??????? Whether the plaintiffs are estopped by their words and conduct to bring the present suit? OPD

(3) ??????? Whether this suit is liable to be dismissed under section 21 of the Specific Relief Act? OPD

(4) ??????? Whether the suit has not been properly valued for the purposes of court‑fee and jurisdiction?

(5) ??????? Which party has violated the agreement dated 8‑11‑1979 and its effect on the suit?

(6) ??????? Whether the plaintiffs are entitled to the specific performance of agreement dated 8‑11‑1979? If so, on what conditions?

(7) ??????? If issue No.6 is decided in favour of the plaintiffs then what is its effect on the rights of the defendant No. 2?

(8) ??????? Whether the defendant 2 is a bona fide purchaser for value without knowledge of agreement dated 8‑11‑1979?

(9) ??????? Relief.

9. The learned trial Civil Judge found that defendant 1 had not taken possession of the property on the 27th April, 1980, as asserted by the defendants but the possession had been delivered by the tenants after the registration of the sale‑deed, Exh. DW3/1, in favour of defendant 2. He held defendant 1 to be guilty of breach of the contract. However, he formed the view that defendant 2 was a bona fide purchaser for value without knowledge of the agreement of sale of the property between the plaintiffs and defendant 1. Issue 4 regarding value of the suit was not pressed before him and the other issue touching maintainability of the suit and defendants' plea of estoppel, he did not feel the necessity of deciding. In the circumstances he was not prepared to grant the relief of specific performance of agreement of the 8th November, 1979. Nevertheless, he decreed the plaintiffs' suit for recovery of Rs.1,50,000 against defendant 1. The suit against defendant 2 for possession of the property was of course dismissed. Feeling aggrieved the plaintiffs and defendant 1 had approached this Court through separate appeals.

10. It was difficult for the learned counsel for the defendants to dislodge the learned trial Court's finding that defendant 1 had not been given possession of the property on the 27th April, 1980, and that the possession had been vacated by the occupants‑tenants after the registration of the sale‑deed in defendant 2's favour. Defendant 1 produced Ghulam Muhammad, DW 1, who occupied the property as tenant, to say that he had given up possession in April, 1980, and had executed the deed of agreement, Exh. DW1/1, in this connection. This document purported to have been executed on the 27th April, 1980, by Ghulam Muhammad, DWl, and Muhammad Islam Butt recites delivery of possession by them to Muhammad Afzal (defendant 1). The execution of this document on the 27th April, 1980, is open to doubt for more than one reason. The register wherein it had been entered by its scribe, Muhammad Sharif Shah, petition‑writer, DW 2, was not properly kept. As admitted by Muhammad Sharif Shah it started with serial No.70 and the previous entries of serial Nos. l to 69 were missing. It had not been page marked and it contained duplicate serial numbers. The factum of execution of Exh. DW 1/1 on the 27th April, 1980, is squarely falsified by the judicial record of the suit brought by Muhammad Islam Butt and Ghulam Muhammad against Muhammad Afzal (defendant 1) and Muhammad Farooq (plaintiff 2) which may be presently examined. On the 2nd April, 198.0, Muhammad Islam Butt and Ghulam Muhammad instituted suit against defendant 1 and plaintiff 2 for issuance of permanent injunction restraining them from illegally and forcibly ejecting them (Muhammad Islam Butt and Ghulam Muhammad) from the property in dispute. They pleaded that they had been in possession of the property as tenants for the last four years and that Muhammad Farooq (plaintiff 2) had given out that he had purchased the property from defendant 1 though he had not given them any legal notice of the alienation. They complained that defendant 1 and plaintiff 2 had threatened them to vacate possession of the property otherwise they would get them forcibly ejected. Apprehending their illegal eviction they took resort to action. Alongwith the plaint they presented application for issuance of temporary injunction pendente lite. The learned Civil Judge, Gujranwala, seized with the trial of the suit, after notice to defendant 1 and plaintiff 2 issued ad interim injunction order on the 26th April, 1980, directing that the plaintiffs in that suit should not be illegally or forcibly ejected. Exhs. P6 and P8 are the copies of the plaint and injunction application, respectively.

11. Defendant 1 filed written statement (copy Exh. P7) in that suit on the 17th May, 1980, stating that only Ghulam Muhammad was tenant under him and that Muhammad Islam Butt was not his tenant nor was he in occupation of the property. He averred that Ghulam Muhammad had become defaulter in matter of payment of rent and, therefore, was liable to be ejected. According to defendant 1's written statement put in on the 17th May, 1980, at least Ghulam Muhammad was in possession of the property in dispute on the aforementioned date. As the perusal of the order sheet (copy Exh. P11) of that suit discloses, the counsel for Ghulam Muhammad and Muhammad Islam Butt made statement before the Court on the 15th June, 1980, that he withdrew from the suit and that the possession had been delivered to defendant 1. The suit was accordingly dismissed as having been withdrawn. It seems that the story of taking over of possession of the property by defendant 1 on the 27th April, 1980, and his approaching the plaintiffs to get possession of the property and have the sale‑deed executed and registered is no more than a manufactured affair. The plaintiffs in this matter were blame free. They cannot be said to have committed breach of the contract or to be unwilling to perform their part of the contract.

12. The finding of the learned trial Judge that defendant 2 was a bona fide purchaser of the property for value without knowledge of the agreement of sale between the plaintiffs and defendant 1 is hard to savour. The learned Judge adopted somewhat queer and fallacious process of reasoning for discarding the testimony of the plaintiffs' witnesses mainly for the absence of any other person when information touching the existence of previous agreement of sale between the plaintiffs and defendant 1 was imparted to defendant 2. Defendant 2's own agent, Muhammad Amin, PW3, who appeared before the Sub‑Registrar on behalf of defendant 2, paid Rs.2,00,000 to defendant 1 and got the sale‑deed, Exh. DW 3/2, registered in favour of defendant 2, bore out that defendant 2 was aware of the agreement of sale between the plaintiffs and defendant 1 and that defendant 1 had said that if any dispute would arise between defendant 2 and the plaintiffs he would not be responsible. He added that defendant 1 had also informed defendant 2 that he had received Rs.75,000 as earnest money but defendant 2 had replied that it did not matter, that he was acting at his own risk and that he would himself get the possession. He went on to say that about ten or twelve thousand rupees had been paid to tongawalas (Ghulam Muhammad and Muhammad Islam Butt) by defendant 2 (for the purpose of vacating possession).

Muhammad Amin, PW 3, was Chairman of Zakat and Ushr Committee. Defendant 2's brother and witness, Sultan Ahmad, DW5, admitted that he had relations with Muhammad Amin since very long, since the time of Muhammad Ayub Khan when he was a B.D. member. He does not bear any hostility towards defendant 2 or his brother, Sultan Ahmad. He appears to be a responsible person and a disinterested witness. He had been specially chosen to act as agent of defendant 2 to pay sale consideration of no fewer than Rs. 2, 00, 000 to defendant 1 and to get the sale‑deed registered. In the circumstances there is every reason to believe his statement in so far as it attributes knowledge to defendant 2 of the existence of agreement of sale of the property between the plaintiffs and defendant 1.

13. Alongwith the evidence of Muhammad Amin may be read defendant 1's deposition to the effect that he had informed defendant 2 of the previous agreement of sale in the plaintiffs' favour. He said that he had told Noor Ahmad (defendant 2) that an agreement of sale of the property with the plaintiffs had taken place and that he had received the earnest money and further that he had made over possession of the property to Noor Ahmad on the 14th May, 1980.

14. The plaintiffs and defendant 2 belong to the same brotherhood and plaintiff 2 is fairly nearly related to defendant 2. They carried on business in close proximity. Evidence was led by the plaintiffs that when they had struck bargain of sale with defendant 1 they had made people of the bazar drink beverages and that defendant 2 had also come and had offered that he might be allowed to purchase the property as it adjoined his shop and that he was prepared to pay Rs.10,000 for foregoing the bargain. It is rather disappointing to note that defendant 2 was not prepared to speak the truth even on minor matters. He expressed lack of knowledge as to whether Muhammad Amin was the Chairman of the Zakat and Ushr Committee or that he had been a B.D. member. He denied his relationship with Muhammad Farooq, plaintiff 2 and said that he did not know whether his own wife was the father's brother's daughter of plaintiff 2's father, Yaqoob. His vain attempt to conceal the truth renders his testimony unreliable.

15. In view of what has been said above and from the tie of brotherhood and kinship between the plaintiffs and defendant 1 and proximity of their places of business it can be inferred with a fair degree of certitude that defendant 2 was aware of the agreement of sale between the plaintiffs and defendant 1 and that he bought the property at his own risk. His bona fides to purchase the property are of questionable character. In the circumstances the plaintiffs are entitled to get the agreement specifically enforced and obtain possession of the property.

16. The learned counsel for defendant 1 contended that defendant 1 had not secured any pecuniary gain by selling the property to defendant 2 because he received the same sale price which the plaintiffs would have paid him and as the plaintiffs were not shown to have suffered any damage it was not fair to burden defendant 1 with the penalty of Rs.75,000. The argument of the learned counsel carries weight. In the absence of any specific damage proved to have been caused to the plaintiffs it is not in the fitness of things to make defendant 1 pay the penalty of such are huge amount as Rs.75,000. However, he is liable to pay Rs.75,000 which he obtained as earnest money from the plaintiffs and which amount is over and above the price of Rs.2,75,000 he got from defendant 2.

17. In view of the above the plaintiffs' appeal is accepted, the impugned judgment and decree recording dismissal of their suit is set aside and a decree for possession of the property in dispute by specific performance of the contract of sale is passed in favour of the plaintiffs and against the defendants. As the plaintiffs have already paid Rs.75,000 as earnest money they will pay Rs.2,00,000 more which amount will be payable to defendant 2 who will recover Rs.75,000 from defendant 1. The defendant 1's appeal is accepted to the extent that in place of the decree for recovery of Rs.1,50,000 by the appellants a decree for realization of Rs.75,000 by defendant 2 is passed against him. The plaintiffs will get the costs of their suit and appeal from the defendants.

A . A. /A‑401/L ?????????????????????????????????????????????????????????????????????????????????? Appeal accepted