Mian MOHAMMAD MEHMOOD AHMED Versus SAFDAR HUSSAIN

MUHAMMAD SHAFI SIDDIQUI, J.--- These direct civil appeals, under Article 185(2)(d)(e) of the Constitution of the Islamic Republic of Pakistan, 1973, as of right, have been filed against judgment dated 14.04.2014 passed by the Lahore High Court, Lahore, whereby regular first appeal filed by respondent No.1/plaintiff (Safdar Hussain) was allowed, which in turn reversed/set aside judgment and decree dated 07.06.2010 of the Civil Judge, Gujranwala and suit decreed.

2.As both appeals filed by different appellants are at variance only on facts, therefore, facts of the same are stated as under chronologically, however, the consequential question of law involved is common and accordingly answered.

Civil Appeal No.168-L/2014: An agreement to sell dated 03.09.2002 ( said agreement ) was entered into between Ijaz Hussain, defendant No.1/respondent No.2, Mumtaz Hussain, defendant No.2/respondent No.3, Imran Ijaz, defendant No.3/respondent No.4, Junaid Javed, defendant No.4/respondent No.5, Jozi Javed, defendant No.5/respondent No.6 and Mst. Silwa Javed, defendant No.6/respondent No.7 ( sellers and original owners ) and Safdar Hussain, respondent No.1/plaintiff ( purchaser ) for the sale of 341 kanals and 17 marlas of land situated in Mouza Nithranwali, Tehsil Kamoki, District Gujranwala and rice mill (sheller) ( suit property ), for a sale consideration of Rs.100,00,000/- and Rs.24,00,000/- out of which an amount of Rs.22,95,000/- was paid by the purchaser to the sellers at the time of said agreement in cash. Besides, certain cheques and amounts in cash were given to the sellers on different occasions. Consequently, total amount of Rs.91,50,000/- had been paid to the sellers by the purchaser and Rs.8,50,000/- was outstanding; to be paid at the time of transfer.

3.The predecessor-in-interest of the present appellants (subsequent claimant), namely, Mian Mohammad Mehmood Ahmed when came to know about the suit filed by respondent No.1/plaintiff, filed an application before the Trial Court to be impleaded as a party to the suit as he claimed ownership and possession of the suit property. The said application was accepted and he was impleaded as party to the suit and arrayed as defendant No.7. He filed written statement and denied the execution of agreement and payment of sale consideration by respondent No.1/plaintiff. He alleged that respondents Nos. 2 to 7/defendants Nos. 1 to 6, owners of the suit property, had agreed to sell the suit property to him, but upon their refusal to transfer the said land to him he had filed a suit on 24.12.2003 for possession through specific performance of the agreement to sell dated 03.10.2002 and during pendency of the suit filed by Mian Mohammad Mehmood Ahmed, the owners of the suit property transferred the same to him vide mutation Nos. 566 and 567 dated 03.06.2005 and 22.02.2007 respectively.

4.Respondent No.1/plaintiff filed a suit for specific performance of the said agreement, which was dismissed vide judgment dated 07.06.2010 by the Civil Judge, Gujranwala. Feeling aggrieved by the said decision, respondent No.1/plaintiff filed regular first appeal before the Lahore High Court, Lahore, which was allowed vide impugned judgment dated 14.04.2014.

Civil Appeal No. 203-L/2014: This appeal has been filed by the appellants, namely, Muhammad Imran Ali, Muhammad Noman Ali, Muhammad Ibrahim and Muhammad Ismail, who were neither party before the Trial Court nor before the High Court. As per facts mentioned in their appeal, they claim ownership of the suit property on the basis of registered sale deed dated 03.06.2010 from one Muhammad Abdullah for a sale consideration of three crore rupees. They further claim that the said Muhammad Abdullah purchased the suit property through mutation No.713 dated 23.12.2009 from the legal heirs of Mian Mohammad Mehmood Ahmed for a sale consideration of Rs.1,70,000/-. They further alleged that Mian Mohammad Mehmood Ahmed purchased the suit property on the basis of an agreement dated 03.10.2002 from respondents Nos. 3 to 8 (who were defendants Nos. 1 to 6 in the suit before the Trial Court).

5.We have heard the learned counsel for the parties and perused the material available on record.

6.The record reveals that the original owners of the suit property joined the proceedings before the Trial Court, but later on did not appear nor did file their written statement to the suit of respondent No.1. The only contesting party to the suit was Mian Mohammad Mehmood Ahmed, defendant No.7/appellant, who filed written statement and denied the execution of the agreement and payment of sale consideration. Respondent No.1/plaintiff in order to support his claim produced oral as well as documentary evidence. Muzaffar Hussain (PW-1), Ijaz Hussain (PW-2), Rehmat Ali (PW-3), Akram Ali (PW-4), Malik Ashiq Ali (PW-6), Shehbaz Ali (PW-7) were produced in support of the said agreement and payment of sale consideration. They all supported the claim of the respondent No.1/plaintiff with regard to the said agreement (Exhibit P.1).

7.The learned Trial Court non-suited respondent No.1/plaintiff mainly on two grounds, firstly, that the plaintiff could not prove the execution of the said agreement and, secondly, the payment of sale consideration, based on statements of subsequent buyers. The learned High Court in the impugned judgment observed that when the execution of the said agreement was not denied by the original owners of the suit property, which facts were otherwise demonstrated in the evidence led by plaintiffs/respondent No.1 (Safdar Hussain) and his witness, the burden to prove the execution of sale agreement was discharged. Same is the case for payment of sale consideration; the learned High Court observed that since the payment was also established and scribe of the said agreement (Exhibit P.1) has been produced as (PW-7), who testified in this regard, amongst others witnesses, thus, the payment of sale consideration stood proved.

8.As far as the stance of the present appellants (in Civil Appeal No.168-L/2014) in respect of the suit property is concerned, suffice it to say that in FAO No.251/2004, (available at page 96 of the paper-book), which was filed by the original owners of the suit property, they admitted in paragraph 6 thereof that they (sellers) had entered into an agreement to sell dated 03.09.2002 with respondent No.1/plaintiff in respect of the suit property and they denied the alleged sale agreement dated 03.10.2002 (subsequent) with the present appellants. Such an admission by the original owners of the suit property and in the absence of evidence contrary to above, effectively foreclosed the case of the appellants in the absence of any confidence inspiring evidence. We have also noticed that the appellants got knowledge of the earlier agreement and consequential dispute and they became party to the said suit upon their own application and filed written statement to the suit, but surprisingly during pendency of the said suit got the suit property mutated in their names.

9.The subsequent transferees are required to discharge a heavy burden to establish that they are bona fide purchasers for value without notice of the prior agreement, litigation and the rights of the earlier vendee, in terms of section 27(b) of the Specific Relief Act, 1877. The provision provides that specific performance of a contract may be enforced against any person claiming under a party thereto, except a transferee for value who has paid his money in good faith and without notice of the original contract. The Court in the case of Faqir Syed Anwar-ud-Din deceased through LRs v. Syed Raza Haider and others (PLD 2025 SC 31) has held that a subsequent vendee seeking protection under the said provision must establish that the transaction was supported by valuable consideration, entered into in good faith and without notice of prior rights, and that he had acted with due care by making reasonable inquiry into the title in the manner expected of a prudent purchaser.

10.The said principle has been further explained by this Court in the case of Gulzar Ahmad and others v. Muhammad Aslam and others (2022 SCMR 1433) , wherein it has been held that mere denial of knowledge of a prior agreement is insufficient to discharge the burden, and that the subsequent vendee must affirmatively establish good faith and due diligence, including reasonable inquiry into the title of the vendor.

11.This position is in line with the law earlier laid down in the case of Hafiz Tassaduq Hussain v. Lal Khatoon and others (PLD 2011 Supreme Court 296) , wherein it has been held that the initial onus to prove valuable consideration, good faith and absence of notice lies upon the subsequent transferee, and upon its discharge the burden shifts to the plaintiff to establish otherwise.

12.It is by now well-settled that the plea of a bona fide purchaser under section 27(b) of the Specific Relief Act, 1877, cannot be accepted on mere assertion, but must be established through cogent evidence and the attending circumstances of the transaction. The subsequent vendee is required to demonstrate that he acted in good faith and with due care, having undertaken such inquiry into the title of the vendor as would be expected of a prudent purchaser. Where the surrounding circumstances disclose elements of haste, lack of inquiry or such facts as would reasonably put a purchaser on notice of a prior claim, the protection of the said provision is not attracted. In such a situation, the subsequent transferee cannot claim the status of a bona fide purchaser, and the prior agreement remains enforceable against him.

13.As far as the claim of the appellants (in Civil Appeal No.203-L/2014) in respect of the suit property is concerned, we may observe that the appellants were neither parties before the Trial Court nor before the High Court. They, as per their own stance, as mentioned in the appeal, claim ownership/title from the subsequent transferees/buyers. As observed, the subsequent transferee/buyers have not discharged their burden that they have no knowledge of the previous agreement or litigation in respect of the suit property, the present appellants had to sail and sink with subsequent transferees/buyers. Since the alleged transferee himself did not acquire a clean title, nothing could have been passed on.

14.Under the circumstances, we are of the considered view that the findings and conclusion drawn by the learned High Court are unexceptionable and in accordance with law and cannot be interfered with. Therefore, these appeals are dismissed.

C.M.As. Nos. 8700 and 8699/2019: Muhammad Ashiq, applicant through these applications seeks his impleadment as party to the present appeals being bona fide purchaser of the suit property. Since we have dismissed the said appeals, therefore, these applications lost their relevance. Disposed of.

C.M.A. No. 1085/2014: This is an application seeking suspension of the impugned judgment. Since the appeals have been decided, this application is disposed of.

UN/M-30/SC Appeals dismissed.