1. ' The plaintiff is carrying on business under the name and style Tahir Soap & Oil Factory and in course of its business, imports various grades of Oil from various countries including Malaysia. The plaintiff imported 500 Metric Tons of Palm Kernel Acid Oil on C&F basis from defendant No,1 through contract dated 1-2-2002 at US $ 165 per Metric Ton, on payment by 100% confirmed irrevocable Letter of Credit, at sight, with shipment date, 28th February, 2002. It is the case of the plaintiff that the irrevocable L/C was opened on 13-2-2002 with expiry date 22-3-2002 with payment at sight against presentation of documents with shipment date 28-2-2002, with presentation of documents within 22 days from the date of Bill of Lading in the country of beneficiary but not later than the expiry date of this credit, (Annexure 'B'). The plaintiff received 3 cover notes dated 16-2- 2002 with unloading date .24-2-2002 of cargo at Karachi for U.S.$ 20,467.76 each. It is the case of the plaintiff that the cargo arrived by vessel M.T. "Chemstar Princess", the same was surveyed. It is also the case of the plaintiff that plaintiff received photocopies of Bill of Lading (Annexures 'E to E -4'), the plaintiff was notified party with port of loading PASIR GUDANG, Malaysia to be delivered at Karachi. It is the case of the plaintiff that on the basis of photocopy of Bills of Lading, the plaintiff through their shipping agent filed Into-Bond Bills of Entry in respect of the cargo (Annexures 'F-1 to F-3') and the consignment has been stored at International Tank Terminal, West Wharf, Karachi.
2. The plaintiff received notice under section 26 of the Customs Act on the ground that they have imported Palm .Kernel Acid Oil vide IGM No,367/02, Index Nos.01,02,03 and 04, dated 28-2-2002 and were directed to produce the original Bill of Lading duly Bank retired documents within three days of the receipt. It is the case of the plaintiff that on receiving, the notice from defendants, they approached the defendants Nos.1 to 3 for obtaining original Bill of Lading but was informed by the defendant No,3 that defendant No,1 has instructed defendant No,2 to deliver the original Bill of Lading to the defendant No,4 and not to the plaintiff, though the plaintiff established irrevocable Letter of Credit in favour of defendant No,1, who on receipt of the Letter of Credit, shipped the consignment on vessel and the documents were supplied, survey report was prepared. The IGM of vessel showed the oil imported by the plaintiff the Original Tanker Bills of Lading showing the oil dispatched to the plaintiff, the oil was discharged in Tank Terminal and the Into-Bond Bills of Entry were filed by the plaintiff who is paying the rent of Bounder as well as other charges including insurance. The defendant No,1 became dishonest and is not supplying the original Bills of Lading to the plaintiff and defendant No,1 is using defendant No,4 for getting the oil cleared with the connivance of defendant No,5. It is case of the plaintiff that plaintiff already stands committed to a party and has sold the oil in advance under normal market practice. If the oil is not delivered to the plaintiff, the plaintiff will suffer a loss of approximately Rs.10 per Kg. Which amount the plaintiff will have to pay to the party. The defendants have no justification in not providing the original Bills of Lading to the plaintiff, Letter of Credit was accepted by the defendant No,1 and contract signed and sent to the plaintiff. The defendant No,1 is legally bound to give the original Bills of Lading to the plaintiff in respect of 498.055 M. Tons of Palm Kernel Acid Oil. The plaintiff has also detailed the loss suffered by them approximately in the sum of Rs.150,000,000. The details whereof are as: L/C US$ 82,500 which comes to Rs.50,00,000, duty and taxes comes to Rs.37,50,000 plus loss of Rs.10 per Kg.
3. From the plaintiff comes to Rs.50,00,000 in addition to insurance amount, storage charges and penal surcharge. Thus the suit with the following prayer:--
(a) That the plaintiff having established an irrevocable Letter of Credit in favour of the defendant No,1 in terms of Contract No,: ' JW/TS & OF/02/0102, dated 1-2-2002 is the owner of 496.897 M/Tons of Palm Kernel Acid Oil.
(b) That the defendants Nos.1 to 3 are legally bound to issue original Bills of Lading in respect of consignment of the plaintiffs as stated above only to the plaintiff and no one else.
4. ' And while granting such declaration, this Honourable Court may be pleased to grant permanent injunction, restraining the defendants, their agents, nominees, assigns or anyone representing through them from taking delivery of Palm Kernel Acid Oil, lying with International Tank Terminals (Pvt.) Ltd., Keamari, Karachi in respect of which Into-Bond Bills of Entry were filed by the plaintiff.
5. ' Further restrain the defendant No,5 or any other authorized/appropriate officer of customs acting or working in his place or on his behalf from processing the documents if any filed by any other party or defendant No,4 and or deliver the consignment of Palm Kernel Acid Oil in respect of which the plaintiff has filed an Into-Bond Bills of Entry.
6. ' Grant mandatory injunction allowing the plaintiff to clear the subject consignment of 496.897 M/Tons of Palm Kernel Acid Oil by filing Bills of Entry for home consumption and on duties and taxes as leviable.
7. ' And while granting such declaration and injunction, this Honourable Court may be pleased to pass a judgment/decree in favour of the plaintiff and against the defendants severally and or jointly in the sum of Rs.1,50,00,000 with mark-up from the date of filing of this suit.
8. ' Costs and any other relief which this Honourable Court may deem fit and proper in the circumstances of the case.
9. ' Alongwith the plaint, the plaintiff has also filed Civil Miscellaneous Application No,4505 of 2002 for restraint order against defendants Nos.1 to 3 from issuing Bills of Lading in favour of defendant No,4 with further restraint order against the defendant No,5 from processing the documents if any produced by defendant No,4 or his agent or nominee in respect of the consignment imported by the plaintiff and/or deliver the consignment in respect of which Into-Bond Bills of Entry have been filed by the plaintiff and the oil stored in the International Tank Terminals (Pvt.) Ltd.
10. ' The supporting affidavit has been filed by Tahir Zaman, the proprietor of the plaintiff with assertion that on offer made and contract signed by defendant No,1 on 1-2-2002 with him, the defendant No,1 offered to supply 500 M. Tons of Palm Kernel Acid Oil at the rate of US $ 165 per M. Tons C&F, Karachi. The plaintiff established an irrevocable Letter of Credit through Habib Bank Ltd. And in response to the Letter of Credit, they received 4 shipping advises with details of loading date, Port of Loading, name of the Tanker, invoice number and value. The consignment reached at Karachi by Tanker M.T. Chemstar Princess on 27-2-2001, which was discharged at the International Tank Terminals (Pvt.) Ltd. The plaintiff was supplied four Tankers Bills of Lading with copies of invoices.
11. The plaintiff filed four different Into-Bond Bills of Entry in respect of four different Tanker Bills of Lading. They are arranging for payment of customs duty. The defendant No,1 is legally bound to give the original Bill of Lading, who has become suddenly dishonest and has not given the original Bills of Lading. If the oil is not supplied to them by the defendant, they would be totally ruined and serious prejudice would be caused if the application is not granted.
12. ' The application has been resisted by defendants Nos.3 and 4 by filing separate counter-affidavits.
13. ' Plea of the defendant No,3 in counter-affidavit, filed by Syed Ishaq Kamal Hashmi, Claim Manager of defendant No,3, was that the plaintiff himself committed breach of contract and is not entitled to any injunction either temporary or permanent and the plaintiff as per terms of contract has failed to open the Letter of Credit as evident from the L/C. They maintained that sale amount has not been paid to the Bank nor the negotiating Bank has intimated to the Shippers that 100% as required in terms of contract has been paid by the plaintiff. They have admitted that the vessel arrived at Port of Karachi on 27-2-2002 and completed discharge of cargo into the Land Tanks, as such, the Into-Bond Bills of Entry filed by the plaintiff on 7-3-2002 are of no legal effect. The plaintiff failed to annex the required documents with the said Into-Bond Bills of Entry, particularly the original Bills of Lading. Hence the plaintiff is not the owners of the consignment discharged by the vessel into the Land Tanks. They maintained that neither the defendant No,3 are concerned with defendants Nos.1 and 2 in any manner nor the defendant No,3 can issue the Bills of Lading of any import cargo. The Bill of Lading of the Import Cargo has always been issued either by the Master or by Shipping Agent at the port of lading on behalf of owners/charters of the vessel, a documentary evidence that consignment has been actually loaded on the vessel. They have also denied the loss suffered by the plaintiff as the Letter of Credit was not opened strictly in accordance with the contract. They maintained that the defendant No,3 will suffer irreparable loss if the application is granted, the defendants will have to face procedural difficulties to amend the IGM, which has already been amended in the name of defendant No,4 as consignees of the oil, in addition to the financial loss to initiate the said amendment, which can only be amended within seven days.
14. ' Whereas, the plea of the defendant No,4 raised in counter-affidavit was that the deal between the plaintiff and the defendant No,1 had come to an end due to dispute regarding the terms and conditions of the Letter of Credit and defendart No,1 after due negotiation offered the said 500,000 M. Tons Palm Kernel Acid Oil to him on the same terms and conditions under a contract dated 11-4- 2002. The contract was duly registered with their Bankers Messrs Muslim Commercial Bank Ltd., and with Messrs Malaysia Palm Oil Board. He on receiving copies of original Bill of Lading immediately informed the Assistant Collector of Custom (Preventive) for permitting him to file ex-IntoBond Bill of Entries. The defendant No,3 requested the Assistant Collector to amend the Import General Manifest as the carrier had changed the name of the consignee on the request of the shippers. It is the case of the defendant No,4, that after retiring the original documents from the Bank forwarded the same to his clearing agents for completing all custom formalities. The defendant No,1 also directly informed the Assistant Collector that the cargo has been sold to him. He pleaded that he deposited the necessary payments regarding surcharge for the change of the name of the consignee and also amendment fee to the Customs Authorities who thereafter allowed necessary amendments in the Import General Manifest. Now he is the owner of the goods and is entitled to take delivery of the same on the basis of the original title documents, which is the relevant Bills of Lading. The copy of Bill of Lading in possession of the plaintiff, are not the document of title to confer the right of delivery to the plaintiff. No payment, whatsoever has been made by plaintiff to the defendant No, 1 . If at all the plaintiff has suffered or likely to suffer any loss as alleged, due to breach of the contract he is free to claim damages from the defendant No,1 which he has already done. He also pleaded that the suit is misconceived, mala fide and not maintainable against him.
15. The application is frivolous and liable to be dismissed with special costs. He further maintained that unless the application is dismissed and the status quo order is withdrawn, he will suffer irreparable loss.
16. ' I have heard Mr. Sohail Muzaffar, learned counsel for the plaintiff and Mr. Naeem Ahmed, learned counsel for the defendant No,3 as well as Mr. Mazhar I. Lari, learned counsel for the defendant No,4.
17. ' It is well-settled law that party seeking an interim injunction must show that a prima facie case exist in his favour; (2) the Court be satisfied that if injunction is not issued, irreparable damage or injury would be caused to such party; (3) the balance of convenience is in favour of the grant of injunction.
18. ' Mr. Sohail Muzaffar, learned counsel for the plaintiff contended that the plaintiff through contract dated 1-2-2002 purchased 500 Metric Tons Palm Kernel Acid Oil (Annexure 'A') opened irrevocable Letter of Credit through Habib Bank Limited. The plaintiff received three cover notes from the shipper. The consignment arrived at Karachi on vessel M.T. "Chemstar Princess'. The plaintiff filed the Into-Bonded Bill of Entry on the basis of photocopy of Tanker Bills of Lading (Annexures 'E to E- 3') and they are entitled for the delivery of the consignment as owner in possession of the cargo but the defendants are avoiding to issue the Bill of Lading.
19. ' Mr. Naeem Ahmed, learned counsel for the defendant No,3 maintained that the plaintiff is not holder of the Original Bills of Lading. The defendant on the basis of Original Bills of Lading is authorized to issue the delivery order. They are not authorized to issue Bills of Lading. He further contended that the payment under the contract was to be made by 100% confirmed irrevocable L/C at sight against the presentation of the documents. The Letter of Credit was issued on 13-2- 2002 with expiry date 22-3-2002 with date of shipment 28-2-2002 and with presentation of documents within 20 days from the Bill of Lading in the country of beneficiary but not later than the expiry date of this credit. These were the confirmed instructions. It was further contended by him that the defendants modified the terms regarding payment that they shall arrange remittance of the proceed after receipt of' the documents. Thus they modified the contract and failed to make payment. The plaintiff was entitled for the shipping documents including the Bill of Lading through their Banker till date they failed to obtain the Bills of Lading and contended that the plaintiff failed to make payment in terms of the contract, as such due to non-payment of contractual price by the plaintiff within time, the contract is relegated to the status of the dead letter and question of its performance does not arise. He further contended that the plaintiff neither in their plaint nor in counter-affidavit have pleaded the payment of the price. It has also been contended by him that contract for sale of goods is not on routine contract which is capable of being performed and such contract not usually to be capable for specific performance and permanent injunction under section 56(f) of Specific Relief Act cannot be issued. He further contended that where a permanent injunction cannot be issued the question of interim injunction also not to be administered. He further contended that in such a matter compensation in terms of money would be adequate consideration and therefore, no element of irreparable loss would subsist. He further contended that the plaintiff is claiming possession of the consignment on the basis of In-bond of Bills of Entry.
20. He referred Annexures 'F' to 'F-3' filed by plaintiff to contend that Bills of Entry were filed without any document. The perusal of column of documents of Annexures 'F' to 'F-3' would show that not a single document was ticked to show filing of required documents, detailed therein, such as, Commercial Invoices, Indent, Bill of Lading, Certificate of Original Letter of Credit, Deliver Order etc. He further contended that photocopy of Bills of Lading was sent only for the purpose of in bonding the cargo only to facilitate the discharge of cargo to avoid demurrage on cargo or the vessel. This will not confer the title in favour of the plaintiff in absence of original Bills of Lading. He also pointed out that the L/C has expired, sale proceed has not been remitted by the plaintiff, no documents have been received by the plaintiff. He contended that the holder of original Bills of Lading is entitled for the delivery of cargo. The defendants Nos.1 and 2 are only authorized to issue original Bills of Lading. The plaintiff has failed to make payment. He is not holder of Bills of Lading, therefore, he has no prima facie case, nor balance of convenience lies in his favour. He further contended that the plaintiff has assessed the damages in terms of money, therefore, he is not entitled for the ad interim injunction as prayed for. Mr. Naeem Ahmed in support of his contention has referred the case of Oil & Gas Development Corporation v. Shujjahuddin (Pvt.) Ltd. PLD 1970 Karachi 332 to contend that the principles which should guide a Court in issuing an ad interim injunction are that:
(1) There should at least be a prima facie case in favour of a party asking for the injunction. (2) The Court should be satisfied that if the injunction is not issued, irreparable damage or injury would be caused to the party's, interests in the property involved and the (3) balance of convenience is an important factor to be considered and such injunction of a mandatory character can only be granted. Mr. Naeem Ahmed to further support his contentions, also referred the following case-law;
(i) V.N. Lakhani & Co. v. Government of Pakistan PLD 1975 Karachi 781 and (ii) Sahaf Corporation (Pvt.) Ltd. v. K.P.T. 1989 MLD 616. He also placed implicit reliance on case-law of Petro Commodities v. Rice Export Corporation of Pakistan PLD 1998 Karachi 1, to contend that contract, involving sale of goods is not capable of specifically performed under section 21 of the Specific Relief Act. Injunction cannot be issued under section 56(f), therefore, no injunction to be granted. In above case general principles governing specific performance of contract for sale of goods were highlighted in following terms:-- "Another aspect of the matter is that a contract for sale of goods, speaking generally, is not routinely a contract, which is capable of being specifically performed. In relation to such a contract, not usually capable of specifically performed, a permanent injunction under section 56(f) of Specific Relief Act cannot issue. Where a permanent injunction cannot issue, an interim injunction also does not arise to be administered. Correspondingly, in relation to contracts of sale of goods, unless otherwise shown and established compensation in terms of money would be adequate consideration and, therefore, no element of irreparable loss would subsist, again coming in the way of grant of interim injunction relative to such contracts."
21. ' Mr. Mazhar I. Lari, learned counsel for the defendant No,4 maintained that 5000 Metric Tons Palm Kernel Acid Oil was sold by the defendant No,1 to the plaintiff through a contract dated 1-2-2002 with payment of 100% through irrevocable Letter of Credit at sight. The L/C was opened on 13-2- 2002 and the documents were to be negotiated within 20 days of the issuance of Bill of Lading. The expiry date of L/C was 22-3-2002, Bill of Lading is dated 16-2-2002. The documents were to be negotiated on or before 10-3-2002 documents were not negotiated till 10-3-2002. The L/C itself was not in terms of the contract, whereby the plaintiff themselves put a clause that they shall arrange remittance of the proceed after receipt of the documents. Such term was against the terms of the contract, thus a dispute between the plaintiff and the defendant No,1, thus the default was committed by the plaintiff due to non-payment on 10-3-2002. When the documents were not negotiated, the defendant No,1 entered into a contract for sale of the consignment on 11-4-2002 with defendant No,4, the same was duly registered with Muslim Commercial Bank as well as Malaysian Palm Oil Board (Annexures 'D-1 to 3'). The term of the contract of payment was cash. The defendant No,4 after making the payment obtained the original Bill of Lading (D-12 to D-16) amended Bills of Lading issued by shipping company under instructions of shipper in the name of defendant No,4. The shipping company can amend the Bills of Lading on the request of the shipper.
22. The Bills of Lading issued to the shipper has been endorsed in favour of the defendant No,4. Now the defendant No,4 is owner of the consignment, who through their clearing agent requested Customs Authorities for - amendment of IGM after payment of required dues and fees. The IGM has been amended showing the name of the defendant No,4. He also pointed out the procedure in respect of the consignment consisting of oil that as soon as ship start loading at the port of loading, photo copies of Bills of Lading and invoices are faxed to the local agent at the destination, the clearing agent used to collect the copy on that basis they used to prepare the In-Bonded Bill of Entry and he referred the Standing Order No,8/88 dated 4-6-1988, regulating the procedure to be adopted in respect of the clearance of dutiable imported edible oils, tallow, Fatty acid and other chemical in liquid bulk. The customs use to deal with the such consignment on the basis of ex- bond Bills of Entry by the importers. He pointed out that no doubt Into-Bond Bills of Entry were filed by the plaintiff but without original Bills of Lading. They have not filed ex-Bond Bill of Entry nor the duty has been paid by them. On the other hand, he contended that the defendant No,4 is holder of the original Bills of Lading manifest has been amended in his name. He is owner of cargo but he is unable to take delivery due to injunction granted by this Court. He also pointed out paras.14 and 20 of the plaint, wherein the facts in respect of the damages sustained by the plaintiff have been stated. The paras.14 and 20 reads as follows:-- "14.The plaintiff already stands committed to a party and has sold the oil in advance as is the normal market practice. If the oil is not delivered to the plaintiff, the plaintiff will suffer a loss of approximately Rs.10 per Kg. Which amount the plaintiff will have to pay to the party with whom the plaintiff has agreed to sell the oil.
20. The plaintiff has so far suffered a loss of approximately Rs.150,00,000 and this loss will accumulate with every passing day. The plaintiff opened the Letter of Credit for US $ 82,500 which comes to Rs.50,00,000,00. Duty and taxes comes to Rs.37,50,000,00 and the party claiming loss from the plaintiff @ Rs.10 per Kg. Comes to Rs.50,00,000,00 then there is insurance amount, storage charges and penal surcharge."
23. ' It has been pointed out by Mr. Mazhar I. Lari that the plaintiff has not paid price of the goods. They have not paid the duty and taxes but, have claimed damages in terms of amount detailed in paras.14 and 20. Mr. Mazhar I. Lari also disputed the contention of the plaintiff that the consignment is in their custody and pointed out that the cargo has been discharged in land Tank of International Tank Terminals, Keamari, who are the licensee of Bonded Warehouse issued by the Customs Authorities. The delivery of the cargo is to be regulated through delivery order issued by the local agents of the shipping company which can be obtained only on production of original Bills of Lading. The defendant No,4 is holder of the original Bills of Lading and he is entitled for the deliver of the cargo and the lastly contended that the suit of the plaintiff is for basically a suit for specific performance of contract of sale of goods barred, in terms of section 21(a) of the Specific Relief Act, as the compensation in money is an adequate relief, plaintiffs have already claimed damages. He also maintained that under section 56(0 injunction cannot be granted to prevent a breach of a contract which could not be enforced. He also referred the following case-laws: (i) Messrs Petro Commodities (Pvt.) Ltd. (supra), (ii) Al Farooq Shipping Company (Pvt.) Ltd. v. Vasa Shipping Ltd.
24. 1980 CLC 1228, (iii) Misbahul Hasan v. Director General of Supplies 1994 CLC 1129, (iv) Dada Steel Ltd. v. Metal Exports 1985 CLC 1814. In cases at seriatim 2 to 4, similar observations were made that the performance of contract in terms of section 58 of Sales of Goods Act is subject to the provision of Chapter 2 of Specific Relief Act, which contains section 21, therefore, if a suit had been brought by the buyer, upon the same cause of action in Court of law, it would not have been permissible in law to order the specific performance of the contract.
25. ' After considering the contentions raised pro and con by the respective counsel, I am of the view that the plaintiff has failed to make out a prima facie case, nor balance of convenience lies in favour of grant of injunction and the plaintiff will not suffer injury or loss that could be said irreparable, as plaintiff has already assessed the damages in terms of money. The reasons for my conclusion are as follows:-- "No doubt the plaintiff contracted with the defendant No,1 for the purchase of 500 Metric Tons Palm Kernel Acid Oil through contract dated 1-2-2002, the payment was to be made by 100% confirmed irrevocable L/C at sight. The L/C was also opened with expiry on 22-3-2002 and payment was to be made against the presentation of the documents, which was required to be presented within 20 days from the date of Bill of Lading in the country of beneficiary but not later than the expiry of the L/C. The plaintiff has failed to establish that payment has been made to the shipper in terms of the contract or in terms of the L/C. Mr. Sohail Muzaffar, learned counsel for the plaintiff has emphasized that the plaintiff was to arrange the remittance of the proceed after the receipt of the document. It is not the case of the plaintiff that the contract was on deferred payment. The plaintiff is not holder of the original Bills of Lading, which is document of title with regard to impugned cargo, mere filing of the in-bond Bill of Entry on the basis of photo copies will not confer the title to the plaintiff over the impugned consignment. To claim the consignment, the party must be armed with original Bills of Lading duly endorsed in his favour. In the present case, the plaintiffs' have not paid the price for the contracted consignment and is not a holder of the original Bills of Lading, as such, no prima facie case exists in their favour. So far, the balance of convenience is concerned, the defendant No,4 has purchased the consignment by the shipper, he has made payment in cash: He is a holder of original Bills of Lading, if injunction is granted, he will be put to inconvenience. The view taken in Petro Commodities v. Rice Export Corporation, supports the defendants, wherein the general principle governing the contract for sale of goods was highlighted by the Division Bench of this Court that a contract for sale of goods, speaking generally, is not routinely a contract, which is capable of being specifically performed. In relation to such a contract, not usually capable of specifically performed, a permanent injunction under section 56(f) of Specific Relief Act cannot be issued. Where a permanent injunction cannot be issued, an interim injunction also does not arise to be administered. Correspondingly, in relation to contracts of sale of goods, unless otherwise shown and established compensation in terms of money would be adequate consideration and, therefore, no element of irreparable loss would subsist, again coming in the way of grant of interim injunction relative to such contracts."
26. ' I am bound by the view taken by the learned Division Bench, the plaintiff has already quantified the damages in terms of money by claiming damages in the sum of Rs. 1,50,00,000, therefore, in such a cases compensation in terms of money would be adequate consideration, therefore, no element of irreparable loss. As consequence thereof, the application has no merits and is dismissed, however, with no order as to costs. The order dated 12-6-2002 is hereby vacated.
27. ' These are the reasons of short order announced on 13-8-2002.