ABDUL KARIM vs MUHAMMAD SHAM AND Another

1. SALAHUDDIN AHMED, J.-This petition for special leave is from the ,order of the learned Chief Justice of the Peshawar High Court dismissing the petitioner's appeal with certain modifications.

2. It appears that there was a contract of sale of the disputed property between the petitioner as vendor and respondent No 1 as vendee for a consideration of Rs.7,000. It was, inter alia, provided in the contract that the petitioner would execute a Registered Deed within six months of his obtaining the requisite permission from the Military Estate Officer and the Income-tax Clearance Certificate from the Income-tax Officer. The permis--sion and the Clearance Certificate were, however, never obtained. It was also provided in the agreement that the advance of Rs. 1,100 paid by the vendee to the vendor would be refunded to the former and, in addition, a sum of Rs. 1,000 would be paid by the latter as penalty if the vendor failed to get the deed registered. The vendor having failed to transfer the property in accordance with the aforesaid contract, the vendee-respondent No. 1 instituted the present suit against the petitioner and respon--dent No. 2, a mortgagor, for possession of the suit property through specific performance of the contract. Since the execution of the contract, the vendee had paid Rs. 1,100 by way of advance as well as certain other sums by way of paying off the mortgage charges including those of himself and respondent No. 2 in accordance with the Contract. Respondent No. 1 was ready to perform his part of the contract.

3. The petitioner contested the suit and stated that the vendee himself had refused to pay the remaining sale price although he was asked to do so several times and he had, therefore, no cause of action. Respondent No. 2 submitted in his written statement that he was mortgagee of the suit property for a certain amount and he admitted the other contents of the plaint filed by respon-- dent No. 1. The suit was decreed by the learned Civil Judge and an order was passed for giving possession of the suit property to the plaintiff-respondent. The vendor'' appeal before the District Judge was partially accepted and the decree of the trial Court was modified to the extent that a sum of Rs.1,050, which was debited towards the consideration money on the basis of three promissory notes alleged to have been executed by the vendor in favour of the vendee acknowledging receipt of the money by the former, was allowed and the vendee was directed to obtain possession upon payment of Rs.1,450 only to the vendor. The petitioner's second appeal was dismissed with the modification that in addition to the sum of Rs.1,450 the vendee was directed to pay an additional sum of Rs.1,050 to the vendor, i.e., a total amount of Rs.2,500.

4. It has been contended before us that inasmuch as the contract provided for payment of a specific amount on the vendor's failing to fulfil the contract and transfer the property to the vendee, no specific performance of the contract could be enforced by the Court. In support of this contention the case reported in PLD 1958 P C 150 was cited on behalf of the petitioner.

5. We are unable to accept this contention in view of the clear provisions of the Specific Relief Act which is applicable in this A M country. Section 12 provides that the specific performance of the contract may be enforced in the discretion of the Court. Explanation to section 12 of the Act clearly states that unless and until the contrary is proved, the Court shall presume that the breach of a contract to transfer immovable property cannot be ade--quately relived by compensation in money, and that the breach of a contract to transfer movable property can be thus relieved.

6. Section 19 provides that any person suing for specific performance of a contract may also ask for compensation for its breach, either in addition to, or in substitution for, such performance. Section 20 says that a contract, otherwise proper to be specifically enforced, may be thus enforced, though a sum be named in it as the amount to be paid in case of its breach, and the party in default is willing to pay the same. Section 22 provides that the jurisdiction to decree specific performance is discretionary, and the Court is not bound to grant such relief merely because it is lawful to do so; but the discretion of the Court is not arbitrary but sound and reasonable, guided by judicial principles and capable of correction by a Court of appeal.

7. The aforesaid provisions thus clearly empower the Court to decree a specific performance of the contract even though a sum be named in the contract as the amount to be paid in case of its breach. The case reported in PLD 1958 P C 150 has no application to the present case inasmuch as the law was apparently different in Ceylon.

8. Having regard to the presumption mentioned in explanation to section 12 it was for the petitioner to prove that pecuniary compensation could give adequate relief to the vendee. This the petitioner has failed to do.

9. It was next contended that time was the essence of the contract and as the vendee had failed to perform his part of the contract, namely, pay the entire consideration of money within the specified time, he could not enforce the contract.

10. The terms of the contract make it clear that it was only after the vendor had obtained the requisite sanction and the Clearance Certificate that the vendee could have proceeded to make the payment of the balance of consideration money. It appears that the vendor failed even to apply for the requisite sanction and the certificate. He, therefore, cannot take advantage of his own default and insist that nevertheless the vendee must have performed his part of the contract, namely, pay the balance of the consideration money. The contention is untenable. The vendee had signified his willingness to perform his part of the contract and, therefore, the Courts were right in decreeing his suit for specific performance of the contract.

11. There is, thus, no substance in the petition and it is accord--ingly dismissed.