1. ' FAISAL, ARAB, J.---In an open auction held by the defendant, the plaintiff obtained on lease premises for its auto workshop and showroom at a monthly rent of Rs.35,100. A written agreement, dated 1-3-1996 was executed between the parties. The lease was for a period of three years, which period commenced on 1-4-1996 and ended on 31-3-1999.
2. ' There is no controversy as to this original three year term of the lease. When the original term was just about to expire, the plaintiff on 8-3-1999 offered the defendant to acquire the premises for 99 year lease against a payment of premium amount of Five Million Rupees and monthly ground rent of ten thousand rupees. The then Executive Officer of the defendant accepted the plaintiff's offer and from time to time received part payments to the extent of 2.5 million rupees. However, when Executive Officer of the defendant demanded balance payment of 2.5 million rupees, the plaintiff refused on the ground that he will pay the balance at the time of registration of the 99 year lease.
3. The Executive Officer then threatened to forfeit the amount paid by the plaintiff and also threatened to take over forcible possession of the premises. The possession of the premises was ultimately taken over by the defendant on 13-10-2000. The plaintiff having been dispossessed filed the present suit for specific performance, permanent injunction and possession.
4. ' The main defence of the defendant in its written statement was that the plaintiff's offer was not accepted by the defendant's Board but it was the Executive Officer who accepted the offer. The Executive Officer of the defendant was not empowered to grant 99 years lease without the approval of the Board and Federal Government. Thus the defendant contended that no agreement subsists between the parties as the entire process of granting lease for 99 years was contrary to the provisions of Cantonment laws.
5. ' The parties went to trial on following issues:--
(1) Whether the suit as framed is maintainable?
(2) Whether there exist any agreement to sell suit property between the plaintiff and defendant?
(3) Whether the amount of sale consideration has been paid by the plaintiff? If so, to-what amount?
(4) Whether the Plaintiff is entitled for specific performance of the agreement? If any?
(5) To what relief, if any, the parties are entitled to?
6. ' Issues No.1 was not pressed during the arguments. Issues Nos.2 and 4 are interconnected and are taken up together.
7. ' Issues Nos.2 and 4: ' When the original three year term under agreement, dated 1-3-1996 was just about to expire, the plaintiff vide his letter, dated 8-3-1999 offered the defendant to acquire the premises for 99 year lease period against a payment of premium sum of Five Million Rupees and monthly ground rent of ten thousand rupees. Along with the offer letter, the plaintiff tendered a pay order of One Million Rupees. The then Executive Officer of the defendant accepted the plaintiff's offer and received one million rupees. Subsequently, additional payment of one million rupees was also made by the plaintiff.
8. ' On 18-9-1999 the then Executive Officer of the defendant wrote to the plaintiff demanding immediate payment of balance amount of three million rupees so that formalities of lease could be processed.
9. The plaintiff responded to the said letter vide his, dated 12-10-1999 by stating that the balance amount would be paid at the time of execution of registered lease in his favour.
10. ' On 20-10-1999, the Executive Officer wrote another letter asking the plaintiff to pay the balance amount of rupees three million within three days failing which the advance amount of two million rupees will be forfeited and the possession of the premises will be taken over.
11. ' On 18-11-1999 the Executive Officer served another notice demanding possession of the premises to be handed over within 30 days, threatening forfeiture of the amount already paid and taking over of forcible possession in case possession was not handed over by the plaintiff. The Executive Officer also threatened to put the premises to open auction. Subsequent to the notice, dated 18-11- 1999, the plaintiff on 27-12-1999 paid additional amount of five hundred thousand rupees towards premium. A sum of Rs.1,20,000 towards monthly rental at the rate of Rs.10,000 till April, 2000 was also paid. When the plaintiff tendered six months ground rent in May, 2000 covering period from May, 2000 to October, 2000, the same was returned vide defendant's letter, dated 22-6-2000 stating that the matter pertaining to the premises is presently under inquiry.
12. ' The plaintiff on 4-7-2000 filed Miscellaneous Rent Case before the Rent Controller, Faisal Cantonment Board, Karachi seeking permission to deposit rent in Court for the month of May, 2000 and onwards which was not entertained on the ground that the Cantonment Rent Restriction Act, 1963 is not applicable to the premises in question under section 3(b) of the Cantonment Rent Restriction Act. Apprehending eviction at the hands of the defendant, the plaintiff in July, 2000 instituted Suit No. 876 of 2000 before this Court wherein status quo was ordered to be maintained.
13. The defendant on 13-10-2000 took over possession of the premises and evicted the plaintiff which led to filing of the present suit seeking specific . Performance of the agreement, dated 8-3-1999 and possession. As the present suit was filed seeking additional relief of possession, the plaintiff withdrew Suit No.876 of 2000.
14. ' The Main defence of the defendant in its written statement was that the plaintiffs' offer made in his letter, dated 8-3-1999 was not accepted by the defendant's Board and therefore no agreement subsists between the parties. It is defendant's case that the Executive Officer of the defendant was not empowered to grant 99 years lease without the approval of the Board as well as of the Federal Government and as the plaintiff was in illegal occupation of the premises therefore he was lawfully evicted. The plaintiff on the other hand was seeking 99 years lease term on the basis of the acceptance given by the then Executive Officer of the defendant to plaintiff's offer letter, dated 8- 3-1999.
15. ' There is no formal letter of acceptance by the defendant, however from the series of correspondence exchanged between the parties it appears that plaintiff's offer was accepted only by the Executive Officer of the defendant. It is therefore imperative to examine whether the Executive Officer was competent to give acceptance to plaintiff's offer or such power vested with the defendant's Board and the Federal Government.
16. ' Relevant provisions for transfer of cantonment lands are sections 111 to 115 of Cantonment Act, 1924 which reads as follows:--
111. Power to make rules regarding cantonment fund and property. The (Central Government) may make rules consistent with this Act to provide for all or any of the following matters, namely:--
(a) the conditions on which property may be acquired by (Boards) or on which property vested in a (Board) may be transferred by sale, mortgage, lease, exchange or otherwise; and
(b) any other matter relating to the cantonment fund or cantonment property in respect of which no provision or insufficient provision is made by the under this Act, and provisions is, in the opinion of the (Central Government), necessary.
112. Contracts by whom to be executed. Subject to the provisions of this Chapter, every (Board) shall be competent to enter into and perform any contract necessary for the purposes of this Act.
113. Sanction.--(1) Every contract--- (a)
17. (bwhich involves a value or amount exceeding one hundred rupees, shall require the sanction of the (Board).
(2) Every contract other than a contract such as is referred to in subsection (1) shall be sanctioned by the (Board) or by the Executive officer on behalf of the (Board).
18. 114.
115. Contracts improperly executed not to be binding on a Board.---If any contract is executed by or on behalf of a (Board) otherwise than in conformity with the provisions of this Chapter, it shall not be binding on the (Board).
19. From the plain reading of section 111 quoted above it is evident that right to transfer Cantonment property vests with defendant's Board subject to the fulfilment of conditions laid down in the rules framed by the Federal Government. Under section 112 it is the Board which is competent to execute contracts. Under section 115 if any contract is executed which is not in conformity with the provisions of the above provisions it is not binding on the Board.
20. ' Reading the above quoted sections of the Cantonment Act, 1924 it is evident that rules are also to be followed while making transfer of Cantonment property. Rules Nos. 2, 8 and 9 of the Pakistan Cantonment Property Rules, 1957 are relevant for the purposes of examining the legality of plaintiff's claim.
(2) Definitions. (1) In these rules unless there is anything repugnant in the subject or context:-- (a)
(b) _________________
(c) _________________
(d) 'Class C land' means land which is vested in the Board under section 108 of the Act.
(8) Transfer of immovable property by Cantonment Boards.---Immovable property which vests in and belongs to the Board shall not be transferred to any person by the Board by way of sale, mortgage, exchange, or otherwise except with the previous sanction of the Government and in such manner and on such terms and conditions as the Government may approve either generally for any class of cases or specially in any particular case.
(9) Provisions governing the leasing of Cantonment Property.--(1) No class 'C' land should be leased or otherwise alienated by the Board save in accordance with such orders as the Government may issue in this behalf.
(2) Subject to the provisions of sub-rule (1) regarding class 'C' land and section 200 of the Act, regarding public markets and slaughter houses. Cantonment Fund buildings may be leased by the Board on the following conditions:-- (i)that a reasonable rent is reserved and made payable during the whole term of the lease; (ii)that the lease is not granted without the previous sanction of the Board for any term exceeding five years and not exceeding ten years without the previous sanction of the Director, Military Lands and Cantonments or for any term exceeding ten years without the previous sanction of the Government or the appointed authority: ' Provided that the Executive Officer may grant a lease of any Cantonment Fund building for a term not exceeding five years, the annual rent of which does not exceed three hundred rupees; and the Cantonment Board may delegate its functions under this rule to the Executive Officer either generally for any class of cases or specifically in any particular case.
21. Rule 2 of Pakistan, Cantonment Property Rules, 1957 defines "Class C land" which means land vested in the Board under section 108 of the Act. Rules 8 and 9 provide that any immovable property which vests in the Board shall not be transferred by the Board except with the previous sanction of the Government. Rule 9(1) and (2) provides that no class 'C' land could be leased or otherwise alienated by the Board without seeking specific orders from the Federal Government. It is also provided in the said rule that grant of lease for a term of five to ten years is to first have previous sanction of the Board and for a term exceeding ten years there has to be previous sanction of the Government.
22. ' From the above quoted sections and rules of the Cantonments laws which regulate the transfer of immovable properties of the defendant, it is evident that grant of lease or alienation of Cantonment property contrary to the prescribed procedure and sanction of the appropriate authority is unlawful. The then Executive Officer while accepting the plaintiff's offer violated the provisions of the Cantonment laws and acted arbitrarily only to shower his favour on the plaintiff.
23. The laws framed for disposal of public property are meant not only to ensure transparency but to also ensure that power to deal with public property is well-defined so that such power in not misused and the functionaries entrusted with public properties act within their defined limits. A public functionary cannot be allowed in any circumstances to encroach upon the powers of the designated authority. It goes without saying that where functions of a public official are circumscribed within the four corners of his defined limits, he has to act within such limits and any overstepping of a nature as in the present case shall be presumed to be intentional with the sole object of seeking favour or showing blessings.
24. ' The acceptance of the plaintiff's offer contained in his letter, dated 8-3-1999 was clearly violative of the above quoted provisions of Cantonment laws and was therefore beyond the legal competence of the then Executive Officer. Lease for 99 years could be granted only when the defendant's Board and the Federal Government have accorded their sanction and approval, which was not even sought from them in the present case. The Issues Nos.2 and 4 are therefore answered in the negative.
25. ' Issue No.3: It is an admitted position that the plaintiff paid a sum of Rupees 2.5 million to the defendant in order to seek 99 years lease. However the same cannot be termed as sale consideration as no binding contract came into existence between the parties as has been held by this Court while dealing with Issues Nos.2 and 4. In the light of the above quoted provisions of Cantonment laws the defendant should not have taken the plea of forfeiting the amount paid by the plaintiff as such a plea to some extent meant that plaintiff was entitled to 99 years lease had he paid the balance amount, which is not the case here. As the acceptance of offer was itself illegal, the question of seeking balance payment or forfeiting the amount already paid did not arise. There was no enforceable contract as the acceptance of offer by the then Executive Officer was itself illegal. The defendant ought to have immediately returned the advance amount paid by the plaintiff instead of seeking the balance amount. In the circumstances, the defendant's act of forfeiting the amount paid by the plaintiff on the ground that balance amount of 2.5 million rupees was not paid in time is therefore not justified.
26. ' On account of unlawful act of the then Executive Officer of the defendant not only parties had to bear litigation expenses but defendant was prevented from putting the premises in question to any purposeful use which would have generated monthly income. For this loss of income and for overstepping one's authority, the defendant should initiate appropriate legal action against the then Executive Officer who was responsible for wrongly accepting the plaintiff's offer.
27. ' In view of the above discussion, this Court is left with no other option but to hold that acceptance of plaintiff's offer, dated 8-3-1999 by the then Executive Officer was not permissible in law and therefore it created no enforceable contract in favour of the plaintiff. However, the plaintiff is entitled for the refund of Rs.2.5 million which he paid for the grant of 99 years lease, subject to adjustment of lease money at the rate of Rs.35,100 per month uptill 13-10-2001 when the possession of the premises in question was taken over by the defendant. After adjusting the amount, the defendant shall refund plaintiff's amount within 15 days. Subject to the above, this suit is dismissed.