DAEWOO HONG KONG LIMITED Versus MEHRAN MOTOR CARS COMPANY
ORDER
1. The plaintiffs have filed this summary suit on Bill of Exchange under Order 37 of the C.P.C. for recovery of U.S. Dollars 27,329,669.80, including mark-up/interest at the present rate of exchange. The plaintiffs and defendants through their learned counsel filed an application under section 151, C.P.C. bearing C.M.A. No.6078/95, which is as follows:---
"(1) That this Honourable Court may be pleased to pass an order on the following terms without prejudice to the legal rights of either ply.
(2) That the cars in question namely 4670 Units, lying as per schedule attached herewith and identified by means of their engine and chassis numbers the "Racer Taxis" shall be maintained, repaired and sold as an interim measure and the sale proceeds shall be deposited in a joint/escrow account to be opened by consent in a Bank.
(3) That all decisions pertaining to the maintenance, repair and sale of the Racer Taxis, including, without limitation, terms and conditions, mode and time of sale shall be taken by the Official Assignee (i) with the consent of both parties and (ii) failing such consent of both parties, with the consent of either party with the dissenting party having the right to seek the orders of this Honourable Court.
(4) That the plaintiff shall be authorised to immediately commence the repairs/maintenance of the Racer Taxis to place them in mint condition in order to facilitate the sale thereof. The costs incurred by the plaintiff, as determined in terms of clause 5 below, shall be a first charge on the sale proceeds.
(5) That the reasonableness/quantum of costs incurred in connection with repair and maintenance of the Racer Taxis to place them in mint condition shall be determined by consent of the parties and falling such consent by arbitration (within then 10 days after either party sends a notice to arbitrate) either by (i) a sole arbitrator or (ii) failing agreement on a sole arbitrator, by two arbitrators, one to be appointed by each party, two of whom shall appoint an umpire before entering upon the reference. Both parties shall make every reasonable endeavour to expedite the arbitration proceedings. The decisions of the arbitral tribunal shall be final and binding on the parties hereto.
(6) That it is prayed that leave to defend the suit may be granted in view of the above and the matter is to then proceed further in accordance with law."
On this application on 19-1-1995 leave was granted to the defendants to appear and defend the suit with a direction to file Written Statement within two months. Later on the Court on O/A's reference dated 1-2-1995, passed the following order:---
"The Official Assignee has made this reference because in order dated the 19th January, 1995, no specific order has been made assigning any duties to him. The learned counsel for the parties agree that the duties of the Official Assignee shall be as stated in paragraph 3 of the application which was disposed of on 19-1-1995."
2. This Court on O/A's Reference dated 22-10-1995 passed the following order:---
"This is a reference by the Official Assignee who was appointed as a Commissioner, upon a joint application by the parties, to sell the cars in question. Mr. Memon says that the sale of the cars in question is in progress and they are being sold at the rate of Rs.2,45,000 each. He suggests that, in the circumstances a fee equal to one per cent. of the sale proceeds, for him would be reasonable. Such fee is by consent sanctioned and may be appropriated by the Official Assignee out of the sale proceeds, subject to administrative approval of the Acting Chief Justice. "
3.On Official Assignee's 'Reference dated 24-1995, this Court on 26-10-1995 passed the following order:---
"By this reference Mr. Memon has sought permission to invest the amount of sale proceeds which is lying with him. Mr. Rana Ikram and Mr. A.R. Akhter agree that the money should be invested but Mr. Khawaja Shamsul Islam opposes the request on the ground that the money belongs to his client who is presently in jail. The objection is totally frivolous because the money is not being given to any one at this stage but is merely sought to be invested for ultimate benefit of the party found to be entitled to it. The defendant, therefore, stands to gain by the money being invested if he can eventually prove his claim to it. The permission to invest the money is, therefore, granted. The Official Assignee will invest the money in such of security as may fetch the highest possible profit. With regard to the payment of the godown-keepers charges, Mr. Memon says that the godown-keepers are refusing to release the cars before their charges and dues are paid. Mr. Rana and Mr. Akhter have no objection to the permission being granted to the Official Assignee to pay godown-keepers but Mr. Khawaja Shamsul Islam objects on the ground that he has to obtain instructions from his client. The objection cannot be sustained because if the Official Assignee has to wait for instructions of the defendants for payment to the godown-keepers before delivery of each car the whole process will grind to a halt. The permission is, therefore, granted to the Official Assignee to make payment to the godown-keepers of such charges as may be found to be due to them. "
4. The learned Official Assignee on 30-11-1995 submitted his reference, relevant paragraphs of which are reproduced as under:---
"(3) That in the meeting held on 7-8-1995 decision was taken vide minutes annexed as Annexture ' A' to sell the vehicles at the rate of Rs.2,45,000 to those persons who are authorised by Ministry of Commerce. It will be relevant to point out here that in the case of Yellow Cabs Government of Pakistan decided to charge only 10% Custom Duty and therefore, Ministry of Commerce issued N.O.C. in respect of these vehicles to employees to Government of Pakistan. The Official Assignee had started to sell the vehicles and recovered amount from the purchasers.
(4) That 1150 Racer Taxis as per schedule with C.M.A. No.4452/1994 are under the possession of Muslim Commercial Bank, which are also required to be sold as per consent to parties in para.3 of C.M.A. No.4452/94.
(5) The Official Assignee addressed letter to Muslim Commercial Bank for release of 1150 cars as per consent of both the parties- in this suit. Mr.A.R. Akhtar, Advocate for Muslim Commercial Bank showed his limitation and stated that he wants protection of his claim original annexed as Annexure ' B' . The Official Assignee invited attention of Mr.A.R. Akhtar, Advocate to Para. 4 of the minutes of the meeting annexed as ' A'. But he insisted for submitting reference in Court for release of 1150 Racer Taxis."
With the abovestated reference of the O/A, minutes of the meeting held on 7-8-1995, are filed. The meeting was attended by M/s. A.R. Akhtar, Advocate, Rana Ikramullah, Advocate, Shamsul Islam, Advocate, Imdad Hussain Butt, Executive V.P. and G.M., Muslim Commercial Bank, Y.S. Kwon and Rafique Akhtar AN.P., Muslim Commercial Bank.
5. In this background the Official Assignee had submitted reference dated 30-11-1995, stating therein that "The Official Assignee is under difficulty as he has received the amount and same has been invested in bank but vehicles have not been delivered to purchasers who have paid the amount".
6. Mr. Abdul Hafeez Pirzada, learned counsel- for the plaintiffs has contended that the defendants were granted leave by the Court to appear and defend on the terms arrived at between the parties, referred to hereinabove; that according to the agreement arrived at between the parties, which was acted upon, sufficient number of cars, have' already been released by the Official Assignee; that the objections raised by the defendants, in any case, are not tenable.
7. Mr. Farooq H.Naek, D.A.-G. has stated at the Bar that at present there is no any scheme or proposal with the Government for increasing the price of the cars and that sale should take place.
8. Mr. Khalid Anwer has contended that the cars were imported before the decision of the Government of Mr. Mooen Qureshi, which dropped the Yellow Cabs Scheme, initiated by the then Prime Minister, Mr. Nawaz Sharif. Mr.Khalid Anwer has referred section 23 of Sale of Goods Act, which is reproduced as under:---
"23. Sale of unascertained goods and appropriation. ---(1) Where there is a contract for the sale of unascertained or future goods by description and goods of that description and in a deliverable state are unconditionally appropriated to the contract, either by the seller with the assent of the buyer or by the buyer with the assent of the seller, the property in the goods thereupon passes to the buyer. Such assent may be expressed or implied, and may be given either before or after the appropriation is made.
(2) Delivery to carrier. ---Where, in pursuance of the contract, the seller delivers the goods to the buyer or to a carrier or other bailee (whether named by the buyer or not) for the purpose of transmission to the buyer, and does not reserve the right of disposal, he is deemed to have unconditionally appropriated the goods to the contract. "
Mr. Khalid Anwer has also referred to C.P. No.2608/93 and contended that the delivery or disposal of the remaining vehicles may be kept pending till the said C.P. is decided by this Court. He has also referred S.R.O. 565(1)/95 dated 27th June, 1995 and stated that it may not be applied, whereas the defendant is willing to dispose of the vehicles under SRO 920(1)/94 dated 22nd September, 1994. Mr: Khalid Anwer has also produced copy of letter of Ministry of Commerce dated 3-8-1995 which shows that S.R.O. 565(1)/95 dated 27-6-1995 imposes condition that the vehicle is not transferable for a period of one year from the date of delivery; and that in violation of this condition the allottees have misused the concession and have sold away the vehicles at higher rate and the Government servants have earned black money, which is not warranted. The defendant is lawful owner of the vehicles. Cars are already cleared from Customs; that SRO 565 was not in existence and that both the parties will suffer loss; that the Official Assignee should not be a party for the black marketing; that per vehicle is to be sold at the amount of Rs.2,45,000 whereas actual market price of the car would be 3,50,000 to 4,00,000; that the defendant is prepared for unconditional and unqualified sale of the vehicles; that the defendant is willing to sell the cars as per SRO 920 dated 22-I1-1994. Mr. Khalid Anwer has cited following authorities:---
(1) 1974 SCMR 519.
(2) 1992 NLR 234
(3) 1995 CLC 592.
The case-law cited by the learned counsel is quite different and distinguish from the facts of the present case and in my humble opinion is not applicable to this case.
9. Leave to appear and defend the suit was granted to the defendants on the joint application of the parties, referred hereinabove. Sale of the vehicles was allowed by the Court on O/A's Reference and out of 4670 cars he has received sale proceeds of 2429 cars through Banks and out of which 1086 cars have been delivered by the Official Assignee to respective purchasers whereas 1343 cars are still to be delivered. There is statement at the Bar by the learned D.A.-G., who was present in the Court alongwith Mr. Raja Abdul Hasib, Section Officer, that there is no any scheme or proposal with the Government of Pakistan for increase of the price of the vehicles and that sale should take place. After the agreement and delivery of vehicles objections were filed by the defendants and since then the delivery of the vehicles is not effected. The persons who have deposited amount with various banks are pressing the Official Assignee very hard for release of the vehicles. Clearance from Customs and other Government agencies is effected only through the intervention of the Ministry of Finance and Economic Affairs, Revenue Division.
10. The contention of Mr. Khalid Anwer that delivery of the left over vehicles may be kept pending till the decision of the C.P. No.2608/93, is hardly to be considered whereas there is no such injunction order issued by the Court for disposal of the vehicles in this particular Constitution petition.
11. I have given my anxious consideration to the facts of the case and I am not convinced with the contention of Mr. Khalid Anwer. The vehicles are at present lying in the godowns with the godown-keepers. There is every possibility of their complete damage and total depreciation. If anybody has committed violation of the conditions, imposed by the Government regarding transfer of vehicles before a period of one year from the date of delivery, then the Government agencies can take legal action against the concerned persons. As such the alleged violation may not be ground for withholding the delivery of the remaining vehicles. The sale of the vehicles is effected at the price including Customs duties fixed by the Government and also the same is agreed by the parties in a meeting held with the Official Assignee which price is approved by the Court vide Court's order dated 26-10-1995 referred hereinabove. The defendants have not raised any objection immediately after start of the delivery of the vehicles but after so many months they have filed objection with the Official Assignee. I am of the firm opinion that keeping in view the principles of equity, consistency, fairplay and justice, delivery of the vehicles, in any case, should not be withheld. As such the objection filed by the defendants is overruled. The Official Assignee is required to immediately start the delivery as per agreement and according to the orders of this Court.
Official Assignee's Reference dated 21-9-1995.
Mr. P.K. Shahani in person.
In this reference the Official Assignee has submitted claim of M/s. Shahani & Co for rupees two millions as professional services rendered by them in connection with the Daewoo Racers Vehicles. According to the reference M/s. Shahani have received Rs.50,000 from Daewoo Corporation. The claim of the claimant M/s. Shahani is Annexure 'A'. According to Mr. Bashir Ahmed Memon, Official Assignee, the claims were sent to both the parties but so far no party has sent any written objections.
12. I have heard Mr. P.K. Shahani, who was present in person. He has referred Daily Dawn dated 31-3-1995 and according to Mr. Shahani this advertisement does not refer any pending litigation and that claim is filed in time.
13. During the course of arguments Mr. Khalid Anwer has filed counter affidavit of Sikander A.Karim. According to Mr. Khalid Anwer claim of M/s. Shahani & Co. is not maintainable; that the suit is filed under summary chapter and is based on Bill of Exchange and the applicant is not a party in the proceedings; that the claimant should file a suit after paying necessary court-fee, if they have any claim over the defendant. Mr. Rana Ikramullah has also adopted the arguments of Mr. Khalid Anwer, Advocate.
14. I have gone through the papers. It is a fact that M/s. Shahani, the claimant are not party to the suit and that proper remedy available to them is to file a suit for recovery of the amount if any.
15. For the foregoing reasons, claim of the claimant Mr. P.K. Shahani, is rejected. O/A reference stands disposed of in terms of this order.
Official Assignee's Reference Dated 16-10-1995
Mr. Abrar Hassan, Advocate contended that M/s. Coral Communication (Pvt.) Ltd. has filed the claim with the Official Assignee towards advertisement charges of Daewoo Racers. According to Mr. Abrar Hassan M/s. Coral Communication (Pvt.) have made advertisement for sale of Daewoo Racers vehicles in the newspaper. Mr. Abrar Hassan has contended that on 31-3-1995 notice had appeared in Daily Dawn and thereafter M/s. Coral Communication filed the claim; that the expenditures so incurred on the advertisement is included in the cost of the cars; that the claim of the claimant M/s. Coral Communication is based on the services rendered by them.
16. Mr. Khalid Anwer, learned counsel for the defendants has contended that M/s. Coral Communication are not party to the suit; that the suit is filed under summary chapter suit and which is based on Bill of Exchange and the applicant is not a party to the suit; that the claim of the claimant is denied by the defendants; that proper remedy available to the claimant is to file a proper suit after payment of proper court-fee. Mr. Khalid Anwer has cited the following authorities:---
(1) 1985 SCMR 714.
(2) PLD 1965 Kar. 633.
(3)1988 MLD 2457.
(4) PLD 1972 Lah. 169.
(5)1924 Vo1.I, K.B.D. 431.
Mr. Rana Ikramullah, Advocate has adopted the arguments advanced by Mr Khalid Anwer, Advocate.
17. I have perused the material placed on the record and come to the conclusion that the claimant M/s. Coral Communication is not a party to the suit and the remedy available to them is to file a suit, if they have any claim. Under the circumstances the claim of the claimant M/s. Coral Communication, is rejected. Official Assignee's reference stands disposed of in terms of the above order.
18. Mr. A.R. Akhtar for Muslim Commercial Bank, contended that an amount of Rupees 103 million is paid by M.C.B.; that the order for sale of the vehicles is obtained at the back of M.C.B.; that the cars are pledged with the M.C.B. may not be released; that Order 14, Rule 2, C.P.C. is not applicable as Receiver is not appointed by the Court and the Official Assignee is not a Receiver in the matter. Mr. A.R. Akhtar, Advocate, has referred following authorities:---
(1) 1989 MLD 3394.
(2) PLD 1980 Kar. 143.
(3) PLD 1983 Kar. 303.
(4) PLD 1994 SC 621.
(5)1994 SCMR 1600.
19. Mr. Khalid Anwer, learned counsel for the defendants, has contended that the facts stated by Mr. A.R. Akhtar, are correct; that the Bill of Lading and physical possession of the vehicles is with the M.C.B.; that the order was passed at the back of the M.C.B.; that the cars are pledged with the M.C.B.
20. Mr. Abdul Hafeez Pirzada, Advocate, has contended that the M.C.B. has joined the proceedings and report of the Official Assignee dated 21-11-1995 shows that the meeting which was held on 7-8-1995, was attended by Mr. A.R. Akhter, learned counsel for M.C.B., Mr. Imdad Hussain Butt, V.P. and G.M., M.C.B., Mr. Rafique AKhter, A.V.P., M.C.B., Mr. Rana Ikramullah and Mr. Y.S. Kwon. The relevant portion of the minutes is as follows:---
"Mr. A.R. Akhtar, Advocate for Muslim Commercial Bank and Mr. Imdad Hussain Butt stated that 1150 units of Daewoo Racers are pledged with Muslim Commercial Bank and are in their possession. It was agreed that vehicles are being sold object to their right of pledge but they will have to prove their claim before the Hon'ble Court. It was further agreed that money which will be received on account of sale of all vehicles will be subject to the decision of the Hon'ble Court." that question of sale is conceded and the M.C.B. is a signatory to the proceedings; that the defendant has consented for sale and obtained leave to defend the suit; that the Official Assignee has accepted the money from the Banking Council and the amount is lying in the Court; that after the statement referred herein, the application for appointment of Receiver in Suit No.699/94, was withdrawn. Mr. Abdul Hafeez Pirzada, has filed Bill of Entry for consumption showing Daewoo Racers Company as owner.
21. The case-law cited by Mr. A.R. Akhter is quite different and distinguish and is not applicable to the facts of the present case as the representative of M.C.B. alongwith their counsel had attended the meeting before the Official Assignee and the reference of the Official Assignee, containing minutes of the meeting, was approved by the Court and delivery of the vehicles actually was effected by the Official Assignee. Therefore, the objection of the M.C.B. for delivery of the vehicles is not sustainable which is accordingly overruled. The amount of the sale proceed is lying in the Court and the party found to be entitled to it, will be benefited as per order of the Court dated 26-10-1995, referred in the earlier part of this order.
22. Under the circumstances objection of the M.C.B. is overruled and the Official Assignee is required to carry on delivery of the vehicles as per order of the Court immediately.
23. The Official Assignee has made a statement during the course of the proceedings that in case vehicles are released for delivery to purchasers he may be permitted to take assistance of F.I.A. for delivery of the vehicles. This submission of the Official Assignee accordingly is accepted.
Order accordingly.
A.A./D-5/K Order accordingly.