Instant first appeal is directed against order dated 8.2.2005 passed by learned Civil Judge, Lahore for its recall/setting aside whereby application of the respondent for issuance of temporary injunction was accepted and the appellants were restrained from alienating the suit property till final disposal of the suit.
2. Succinctly, relevant facts of the case are that the appellants being owners of the property consisting of House No, 138/139, Block-G, Model Town Cooperative Society, Lahore being successors of late Feroz Din, the original owner entered into an agreement to self the same with the respondents through a written agreement dated 23.4.2004. The sale price was settled at Rs, 33,000,000/- out of which an amount of Rs, 50,00,000/-was paid as earnest money. According to the terms settled between the parties, duly incorporated in the agreement, the appellants were to get "No Objection Certificate" from the Model Town Society within 60 days whereafter the sale- deed was to be executed within 30 days. It was further envisaged in the agreement that in case of delay in issuance of "No Objection Certificate", the period for execution of sale-deed shall be extended with the consent of the parties. The appellants contacted the society for issuance of "No Objection Certificate" but were required to produce a decree of the Court, declaring them legal heirs of Feroz Din (deceased), the original owner. The appellants filed a suit for their declaration of being heirs/legal representative of the deceased Feroz Din, against Model Town Cooperative Society but inspite of concessional written statement by the society, suit is reported to be still pending. The appellants on 6.9.2004 issued a notice of rescission of agreement and returned through a pay, order of the earnest money received by them. The respondent in response, filed a suit for specific performance with the averments that he had always been ready and willing to perform his part of contract by paying the balance sale price but the appellants failed to get the requisite "No Objection Certificate" without which the sale-deed could not be executed. The respondent also filed an application under Order XXXIX, Rules 1 and 2 C.P.C. in his suit praying temporary injunction that the appellants may be restrained from alienating the property agreed to be sold in his favour to any body else.
3. The appellants being defendants in the suit contested it and opposed issuance of injunction by filing their written statement/written reply, admitting the agreement to sell between the parties dated 23.4.2004. Stance of the appellants was that they had exerted to execute sale-deed and filed a suit against the society as well but failed hence while opting option of cancellation of agreement according to its clause (6), the same was cancelled and the earnest money was returned. The learned Civil Judge who was cognizant of the suit, after hearing the parties issued the injunction prayed by accepting application of the respondent vide his order dated 8.2.2005. The appellants have now filed this instant appeal wherein the respondent has appeared through his counsel, in response to notice by this Court.
4. Learned counsel for the appellants submitted that agreement to sell dated 23.4.2004 stood cancelled by invocation of its clause (6) and the earnest money received by the appellants had already been returned those, they should not have been restrained from dealing with title of their property. It was further argued that the appellants had exerted hard to fulfil their commitment but inspite of their efforts, suit against the society is not being decided on account of formal defects therein, hence the agreement to sell cannot be performed. It was further argued that time was essence of the contract on expiry of which, the appellants are not bound to pedant their part of contract. It was also submitted on behalf of the appellants that principle of lis pendens is there to protect rights of the respondent, if any, and its presence, the appellants could not have been restrained from alienating their owned property. According to him, injunction issued by the trial Court without requiring deposit of balance of sale price from the respondent is unwarranted hence the same deserves to be vacated. It was further submitted that no prima facie/arguable case existed in favour of the respondent hence, his application should have been dismissed.
5. Learned counsel for the respondent refuted the arguments of the appellants, supported the impugned order and urged that according to the agreement, the appellants were to get "No Objection Certificate" from Model Town Society and unless and until such certificate was not obtained, sale-deed could not be executed. Learned counsel for the respondent expressed his willingness to pay the entire sale-price on two weeks notice, in case the terms of the agreement, including NOC is fulfilled. It was further submitted that injunctive order issued by the trial Court cannot be vacated solely on the ground that lis pendense is there to protect rights of the respondent. According to him, in case of alienation, the dispute would become more complex which would multiply the litigation between the parties. It was urged with emphasize that the appellants could not unilaterally cancel the agreement as no such authority was given to them by its clause (6). Prima facie/arguable case in favour of the respondent was assertively claimed besides the submissions that he will suffer irreparable loss/injury if the injunction issued is vacated.
It was submitted on behalf of the respondent that balance of convenience lies in his favour and he may not be required to deposit the balance sale-price because suit property is in use of the appellants. Learned counsel for the respondent offered to pay the balance sale price in case the possession of the property is handed over to the respondent till issuance of NOC or execution of sale-deed.
6. I have minutely considered the respective arguments of the learned counsel for the parties and have examined the record, appended herewith: Undisputedly, the appellants entered into an agreement to sell their property after receipt of earnest money of Rs, 50,00,000/-. They themselves agreed to get "No Objection Certificate" from Model Town Housing Society without which they could not transfer the suit property in favour of the respondent. Suit filed by the appellants against the society stood conceded by the defendant therein but is being not decided on account of some formal defects. It was the responsibility of the appellants to remove the defects in their suit and to have the same decided. Tentatively, the apparent lapse appears to be on the part of the appellants, out of ulterior motives. The appellants could not point out any lapse on part of the respondent in discharging his part of the contract, without which the agreement could not be rescinded unilaterally. Penalty clause of the agreement prima facie is not meant for the purpose, for which it has been used and the same, prima facie, will not relieve the appellants of their liability to perform their part of contract. Similarly in the cases involving contract of sale of immovable property, time appears to be not essence of the contract and inspite of clause (6), suit of the respondent can be decreed to the judicial discretion of the trial Court. All this brings me to hold that a prima facie/arguable case existed in favour of the respondent and in case of alienation by the appellants he would suffer an irreparable loss/injury. Balance of convenience also lies in his favour and the appellants being in actual physical possession/use of the property would face no inconvenience if the injunction issued is not vacated.
7. As regards principle of lis pendense, no doubt, it is there to protect rights of the respondent in case of his success in the suit but even on availability/applicability of principle acknowledged by Section 53 of the Transfer of Property Act, 1940, Courts are not denuded from their jurisdiction to restrict the alienation of the ,suit property. However, the discretion vesting in the Civil Court by terms of Order XXXIX, Rules 1 and 2 C.P.C. is not subject to the provisions of Section 53 of Transfer of Property Act, 1940. Reference in this behalf can be safely made to the judgments in the cases of Sardar Wali Muhammad versus Sardar Muhammad Iqbal Khan Mokal and 7 others (PLD 1975 Lahore 492) and Rustam Ali versus Chaudhry Mukhtar Ahmad Anwar (NLR 1984 Civil 323).
8. Adverting to the objections of the appellants that without requiring the respondent to deposit the balance sale price, injunction prayed should not have been issued. It goes without staying that the appellants have already returned the earnest money through a pay order dated 6.9.2004 which was produced by the respondent in original, before the trial Court and remained their without encashment and in view of their stance, they are not interested in payment of balance sale price.
Besides it, they have been offered the payment of entire sale price in case they hand over possession of the property to the respondent but they paid no heed to it. Above all, the property being in use of the appellants, they cannot be heard to say that they will not part with the possession of the property and the respondent be required to deposit the entire sale price, without any benefit to him.
9. For the reasons noted above, the order impugned was not only lawful/justified but the same could not, as well, be shown, as opposed to any known canon for administration of justice, or in any manner was arbitrary/financial hence, no interference in the order of the trial Court is called for.
Consequently, this appeal being devoid of force is dismissed with no order as to costs but in the interest of justice, the trial Court is directed to conclude the proceedings in the suit before ensuing winter holidays i,e, till 24.12.2005.