MUHAMMAD SHARIF Versus NATIONAL MOTORS LTD.

1. The plaintiff imported two Bedford bus chassis from M/s. V auxhall Motors Ltd. , London through their agents i.e. the defendants. The price of these two chassis was paid to the company directly on Ist April, 1974. By letter dated 29th August, 1974 the defendants informed the plaintiff that they have placed him in a group of four persons who had also imported similar chassis. In all 12 chassis were imported by this group two of which belonged to the plaintiff. The Chief Controller of Import and Export issued authorisation letter date 1‑4‑1975 permitting him to import the two chassis and this information was conveyed to the defendants who informed that the plaintiffs will have to pay local charges @ Rs.12,508 per chassis against the delivery of the assembled chassis. The arrangement between the defendants and their principal was that the defendants were to assemble the chassis at Karachi and then deliver to the purchaser. The defendants were also required to inform the plaintiff after assembling the chassis asking them to take delivery. The plaintiff waited for sufficiently long time, but as no information was received he visited the defendants office and contacted their Junior Sales Executive who directed him to contact one Mr. Rana. He informed the plaintiff that the defendants had sent a telegram to him to the effect that the chassis in question were ready for delivery and that the plaintiff was asked to take delivery. On an examination of the copy of the telegram the plaintiff noted that it was addressed to 64‑B Satellite Town, Rawalpindi instead of Bahawalpur. Therefore, this telegram was never received. However, the plaintiff offered to take delivery on payment of the contractual charges, but the defendant delayed and after two months informed that the charges have been raised from Rs.12,508 to Rs.33,008. They also demanded storage charges @ Rs.150 per chassis per day w.e.f. 31‑11‑1975 which was unlawful and illegal. The plaintiff, therefore. filed the suit for obtaining delivery of the chassis. The defendants filed their written statement in which it was pleaded that suit as framed is not maintainable. They admitted that order was placed by the plaintiff originally on 25‑2‑1974. The prices and local charges prevailing at the time of shipment and delivery were to be applicable irrespective of the fact when the order was placed. It was admitted that at the time of placing order the charges were Rs.9,214 which were subsequently raised to Rs.12,508. The plaintiff was required to remit $.3744 but he failed to make payment within the stipulated period and the order was cancelled. However, at plaintiff's request it was restored. It has been pleaded that the plaintiff did not take delivery and as the local charges were increased from Rs.12,508 to Rs.33,008 he was liable to pay it before taking delivery. It has been pleaded that under the orders of the Court dated 6‑1‑1976 the plaintiff has taken delivery of one chassis and till the filing of the written statement, the delivery of the second chassis had not been taken. It has been stated by the learned counsel for the plaintiff that first chassis has been taken delivery on payment of entire charges as demanded by the defendants and the second chassis has been delivered on furnishing bank guarantee. This statement has not been denied by the learned counsel for the defendants. Or the basis of the pleadings the following consent issues were framed:

(1) Whether the suit for specific performance, as framed, is maintainable in law in the circumstances of the case ?

(2) Whether under the terms of, the Order No.SALES‑1873 dated 25‑2‑1974, constituting the contract, the plaintiff was obliged to pay the local charges prevailing at the time of delivery of the chassis ?

(3) Whether under the said Order or otherwise the defendants were obliged to serve notice on the plaintiff for readiness of the chassis for delivery? If so, whether any such notice was served on the plaintiff at the address given by him? If not, its legal effects?

(4) Whether under the terms of the said Order the local charges of the chassis are subject to change without notice ?

(5) Whether the plaintiff has failed to pay the local charges prevalent at the time of delivery to the defendants and failed to lift the, chassis in spite of defendants' telegram dated 23‑10‑1975 ?

(6) Whether the plaintiff is liable to pay storage charges, as claimed by the defendants with effect from 13‑11‑1975 till the chassis are lifted by the plaintiff ?

(7) Whether the plaintiff is entitled to any relief?

(8) What should be the decree ?

2. ISSUE NO.1.

3. The learned counsel for the defendants has contended, that the suit is for possession of movable property, and the plaintiff wants specific performance of a contract of sale of goods. It is further contended that no declaration can be granted in respect of contract for sale of goods. According to the learned counsel compensation is the adequate remedy under law, and, therefore, the contract cannot be specifically enforced. The complexion of the entire matter has changed due to delivery of the chassis during the pendency of the suit. The delivery o!' the two chassis were taken in terms of order dated 6‑‑1‑1976 passed on C.M.A.8/1976 which reads as follows.‑‑

4. "By consent of the learned Advocates for the parties and without prejudice to the respective contentions and rights of the parties, the following order is passed:‑

5. The defendants shall deliver to plaintiff the two chassis purchased by him through the defendants in the following manner. One chassis by 8‑1‑1976. on payment by the plaintiff of customs duty and charges payable to the Government and one chassis on furnishing of security or Bank guarantee by the plaintiff in the sum of Rs.41,000 to the satisfaction of the Nazir of this Court, and on payment of Rs.25,016 to the defendants in addition to the payment of customs duty and charges payable to the Govt. This order disposes of Civil Misc. Application No.8 of 1976." The plaintiff had obtained delivery of two chassis as far back as in the year 1976 and by now he would have used the vehicles, therefore, in these circumstances the question of maintainability of the suit on the ground that prayer for specific performance cannot A be granted seems to be completely redundant. Now in the changed circumstances which have happened due to the order of the Court relief will have to be moulded in a form which is legal and more near and applicable to the facts of the case. In view of the facts and circumstances of the case the reply to issue No.l is in the negative.

6. ISSUE No.2 .

7. There is hardly any dispute on this issue. The plaintiff was liable to pay local charges prevailing at the time of delivery of the chassis. However, in the present case, the main dispute is that the delivery was not effected by the defendants, nor any intimation for such delivery was given at the time when delivery was effected to other members of the group. This aspect will be fully dealt under issue No.3. My finding is in the affirmative.

8. ISSUE No.3 .

9. In terms of agreement between the parties the delivery of the chassis was to be made by the defendants after assembly which was to be carried out at Karachi, by the defendants. The goods were, therefore, not in a deliverable state. The defendant was bound to do something for the purpose of putting them in a deliverable state. In such circumstances the delivery of the property would pass only after the seller has put the goods in a deliverable state and the buyer has been notified of it. Section 21 of the Sales of Goods Act provides for such a notice. As the defendants were to make the chassis in a deliverable state they were bound to notify the plaintiff that the goods are ready for delivery because without such notice he could not be expected to take delivery. Section 21 intends to avoid hardship to the buyer as in such circumstances risk cannot be passed without notice. The chassis was in deliverable state on 24‑7‑1975. The question arises whether the plaintiff was notified by the defendants. The defendants have relied on a telegram dated 24‑7‑1975 but it was not properly produced or proved. Even in the written statement and correspondence exchanged between the parties no reference was made to this telegram. Exh.10 is the letter dated 13‑8‑1975 in which the amount of customs duty, sales tax and local charges were mentioned but the delivery was not offered. On the other hand the plaintiff has stated on oath that on 1‑7‑1975 he had gone to the office of the defendants and met Mr. Kamal Nasiruddin who asked him to come again as goods were not ready for delivery. He again visited on 23‑7‑1975 but same reply was given and he was asked not to come and he would be informed when the goods are ready for delivery. He waited for some time but as no reply was received he again visited on 1‑9‑1975 when he was told that a notice was sent in the end of July, 1975. Mr. Kamal Nasiruddin demanded local charges @ Rs.33,081 per chassis. He then referred the plaintiff to see Mr. Rana who was incharge of sending notices. He has produced a visiting card of Kamal Nasiruddin who had made a note on it to assist him as he had not received the telegram. On such inquiry he was told that a telegram had been sent and when he examined the copy he found that it was sent to Rawalpindi, and not at the plaintiff's address at Bahawalpur. If this statement was wrong and the defendants had sent any telegram they ought to have produced its copy in Court. They could have produced the persons who were named by the plaintiff, but they have not been examined, therefore, it is proved that no notice was sent to the plaintiff in the end of July at his address at Bahawalpur. The notice sent to Rawalpindi which is not the plaintiff's address can hardly be treated as a proper notice at all. Further more the plaintiff' served notices dated 9‑9‑1975 and 10‑10‑1975 whereupon the defendants sent a telegram to take delivery by 12‑11‑1975. The defendants also replied to the legal notices on 3‑12‑1975 but no reference was made to the notice of taking delivery alleged to have been served in November, 1975. From the above facts it is clear that the plaintiff had been running to the defendants office from July, 1975 onwards and had been demanding delivery, but it was being avoided although the chassis were ready for delivery on 24‑7‑1975. The defendants even failed to notify the plaintiff that the chassis were ready for delivery. The rate of local charge was enhanced on 22‑10‑1975 and it seems that this was within the knowledge of the defendants and, therefore, they delayed the delivery so that they may charge at the enhanced rate. The defendants witnesses admitted that as approval from the Government for enhancement of local charges had not been obtained till October, 1975 the intimation to the plaintiff was not sent till such time it was obtained. In these circumstances, the default is on the part of the defendants who for ulterior motive to recover enhanced local charges purposely avoided to notify the plaintiff so that delivery may be effected after the local charges had been enhanced. Therefore, as the plaintiff was not in default or in breach of agreement and the delivery was postponed or avoided by the defendants for illegal gain, the plaintiff cannot be made liable for payment of enhanced local charges and delivery is to be effected on payment of local charges payable on the date when the chassis was ready for delivery i.e. from July, 1975‑‑when the plaintiff was also ready to take delivery which was avoided by the defendants. My finding is as follows:‑

10. ISSUE No. 3.

11. The defendants were bound to give the plaintiff notice of readiness of chassis for delivery. No such notice was served on the plaintiff and he is not liable to pay enhanced local charges. It is an admitted position that in terms of letter dated 25‑2‑1974 (Exh.19) the local charges were liable to be changed without notice. However, the local charges prevailing on the date of delivery were payable by the plaintiff. My finding is in the affirmative.

12. ISSUE No.5 .

13. In view of discussion on issue No.3 my finding is in the negative.

14. ISSUE No.6 .

15. The defendants have claimed storage charges from 13‑11‑1975 till the chassis were lifted by the plaintiff. This claim is untenable as the delay was caused due to the default and neglect on the part of the defendants. The defendants intimated the plaintiff after a long delay merely for their gain. They demanded enhanced local charges which the plaintiff was not liable to pay. In these circumstances delivery could not be effected to the plaintiff My finding is in the negative.

16. IS SUES Nos.7 & 8

17. The plaintiff was entitled to take delivery on payment of local' charges @ Rs.12,508 per chassis which was payable on 24‑7‑1975 when the same was ready for delivery. The plaintiff had been approaching for obtaining delivery but the defendants postponed delivery illegally for their own unlawful gain, therefore, they are not entitled to claim local charges @ Rs.33,008 per chassis which was l fixed in October, 1975. Had the defendants notified on 24-7‑1975 when the plaintiff had visited their office, he would have taken delivery much before the local charge was enhanced. The defendants cannot take advantage of their own default and burden the plaintiff' with the enhanced local charges..

18. The plaintiff has already taken delivery of both the chassis in 1976. The same would have deprecated and cannot be returned to the defendants in their original condition. While granting relief the Court can take note of the subsequent events provided no prejudice is caused to any one and mould the relief as the circumstances demand. The plaintiff has prayed for possession of two chassis on payment of local charges @ Rs.12,508 per chassis and declaration and injunction restraining the defendants from charging enhanced local charges and storage charges. The defendants besides legal objections have pleaded that by notice dated 23‑10‑1975 the plaintiff was allowed to take delivery up to 12‑11‑1975 failing which storage charges @ Rs.150 per day were to be recovered. The defendants had also demanded enhanced local charges. The defendants, therefore, kept the contract. alive and open so long storage charges were paid. With the consent of parties order dated 6‑1‑1976 was passed without prejudice to their contention and rights and delivery was taken in terms of that order. In these circumstances it is to be considered whether the plaintiff is entitled to any relief. It is well‑settled that neither a decree for specific performance of contract for sale of goods and injunction, nor a declaration in respect of rights arising out of contract can be granted as monetary compensation is considered adequate relief. In such cases taking into consideration the provisions of section 19 of the Specific Relief Act, the facts and circumstances of the case, the Court is vested with discretion to grant damages to the plaintiff provided breach on the part of the defendants and damage suffered by the plaintiff are proved. This view finds support from Kr. Shushilendra Pal Singh v. B. Kailash Chand Bhargawa and others AIR 1945 Allahabad 395. In this case the respondent /plaintiff had executed electrical work in a cinema and he was to be paid in instalment of Rs.100 per day. In case of default he was entitled to remove the electric installations. As default in payment was made the respondent filed suit praying for a "perpetual injunction restraining the defendants from using the electric installations in the cinema house and also restraining them from obstructing the plaintiff in removing the electric fitting". No prayer for damages was made but it was stated that he would file another suit later on if he considered it necessary. The suit was dismissed because the contract could not be specifically enforced, therefore, no injunction could be granted. In first appeal the District Judge holding that injunction could not be granted observed that the plaintiff was entitled to compensation. He set aside the decree and remanded the case for determination of damages. In second appeal the High Court after examining various authorities upheld the judgment and it was observed:‑

19. "The broad ground upon which these decisions rest may be stated thus: If upon the facts pleaded in the plaint a case is made out which would lay the foundation for the relief granted, although not specifically asked for, the plaintiff is entitled to the relief which those facts will sustain, under the general prayer contained in the plaint. But there is, however, one important limitation. As held by their Lordships of the Privy Council in 55 I . A 860 if during the progress of the suit arid before the final hearing the plaintiff abandons his claim to specific performance or disentitles himself to that relief by some act on his part, he cannot claim or be awarded by the Court damages in lieu of the specific performance of the contract. Jurisdiction to award damages in substitution of the relief for specific performance remains so long as the plaintiff does not act on his part to disentitle himself to a decree for specific performance. To the same effect is the decision given as long ago as 1806 by Lord Erskine L.C. (1806) 13 Ves.114 at p.119."

20. In this judgment reliance was placed on Callianji Harjivan v. Narsi Tricum ILR 19 Bom. 764. Arya Pardishak Prilimidhi Sabha v. Lahori Mal AIR 1924 Lah. 713, Kallian Das v. Tulsi Das ILR 23 Bom. 786, K.H.H. Skinner v. Rosy Skinner AIR 1925 Leh. 132, Ookerjee Cowasjee v. Sabhapathy Mudaliar AIR 1919 Mad. 560, Krishna Aiyer v. Shamanna 17 I.C. 497, Aung Din v. B.K. Halder 157 I.C. 26 and Satyataran Chaudhury v. Jyoti Parsad AIR 1923 Pat. 386. The rule laid down by these authorities is that section 19 of the Specific Relief Act intends to prevent multiplicity of suits and do complete and substantial justice between the parties. In a suit for specific performance the plaintiff is not obliged to specifically seek relief of damages. In such a suit the Court has ample discretionary power to grant damages provided foundation for such relief has been laid and the plaintiff has neither abandoned nor disentitled himself from seeking relief of specific performance. In these circumstances if F the Court is of the opinion that the facts justify grant of relief of damage and it is an appropriate remedy, it should be granted even if there is no prayer for such a relief. Furthermore if the relief of specific performance or injunction cannot be granted as pecuniary compensation is an adequate relief then subject to the afore stated principle damages can be awarded. The appellate Court can even remand the case for inquiry on question of damages.

21. In the present case the plaintiff has proved that the defendants have committed breach of contract and he has suffered damages. The question of damages suffered by the plaintiff would be the difference between the rate of local charges which was prevalent on 24‑7‑1975 and the enhanced local charges demanded by the defendants. On 24‑7‑‑1975 the local charge was @ Rs.12,508 per chassis which was G enhanced to Rs.33,008. The plaintiff thus suffered loss of Rs.20,500 per chassis. Therefore, the defendants would have been liable to pay Rs.41,000 as damages and also refund the cost of chassis paid by the plaintiff. The plaintiff has already taken delivery and due to use and depreciation the chassis cannot be returned in its original condition, therefore, the question of payment of their cost by the defendants does not arise. So far local charges are concerned the plaintiff would have been liable to pay at the old rate. The plaintiff has paid Rs.25,016 to the defendants and furnished a bank guarantee for RK.49,200.which is the total sum of Rs.41,000 being the enhanced local charges and Rs.8,200 towards sales tax. As delivery has been given and the defendants are not entitled to claim enhanced local charges while the plaintiff is entitled to damages of Rs.41,000 it would be just and equitable that the bank guarantee to the extent of Rs;41,000 furnished in terms of order dated 6‑1‑1976 be discharged. As by this process the rights of the parties will square up the plaintiff shall retain possession of the two chassis delivered to him by the defendants. The defendants shall keep Rs.25,016 paid by the plaintiff towards local charges and the bank guarantee to the extent of Rs.41,000 furnished by the plaintiff is discharged. The Nazir shall encash the bank guarantee to the extent of Rs.8,200 which on realization shall be paid to the defendants towards sales tax. The parties to bear their costs.

22. Suit decreed.

23. A. A./M‑688/K Order accordingly.