' FAISAL ARAB, J.---The case of the plaintiff is that he entered into an agreement for purchase of suit property i.e, house bearing No,B-26, measuring 400 Sq. Yd., in Block-A, situated at KDA Officers Co- operative Housing Society Ltd., Karachi, for a total sale consideration of Rs,97,75,000. Prior to entering into sale agreement on 23-1-2004, the plaintiff paid Rs,1,50,000 as earnest money to the defendant No,1 and at the time of execution of sale agreement a further sum of Rs,8,50,000 was paid to the defendant No,
1. In all one million rupees were paid and the balance sale consideration amount of Rs,87,75,000 was to be paid within 105 days from the date of the execution of sale agreement i.e, up to 8-5-2004. It is further the case of the plaintiff that before the expiry of the date of performance of the agreement, the defendant No,1 refused to sell the suit property and sought cancellation of the sale agreement which compelled the plaintiff to file this suit on 29-4-2004 i.e, 10 days before the expiry of time fixed for completing the transaction. At the time of filing of this suit, the plaintiff obtained injunction order which was granted subject to deposit of remaining sale consideration in cash. Subsequently this order of deposit was modified and 25% amount was allowed to be deposited in cash and for the remaining 75% amount, security was to be furnished.
The case of the defendant No,1 is that the plaintiff did not have the money to complete the transaction on or before the cutoff date i.e, 8-5-2004 and therefore, the defendant No,1 served legal notice on 12-5-2004 rescinding the contract. It was argued that the plaintiff is not entitled for the relief of specific performance of contract.
2. On 27-11-2006, following issues were framed by the Court:--
(1) Whether any cause of action has accrued to the plaintiff?
(2) Whether instant suit by plaintiff has not been filed prematurely, dishonestly and with mala fide intention to cover his own default in performance of the agreement dated 23-1-2004?
(3) Whether the plaintiff has fulfilled/complied with the terms and conditions of the sale agreement dated 23-1-2004?
(4) Whether the defendant No,1 has rightly rescinded the sale agreement dated 23-1-2004?
(5) What should the decree be?
3. First issue was not pressed as admittedly agreement was executed. The only question that is to be decided is whether the plaintiff has demonstrated that he was ready and willing to perform his part of contract and it was defendant No,1 who failed to perform his contractual obligation under the sale agreement. Counsel for the plaintiff has referred to cross-examination of the defendant No,1 wherein it was admitted by the defendant No,1 that before the expiry of the time fixed for performance of the agreement i.e, 8-5-2004 there was a meeting at the house of the defendant No,1 wherein his family members were present and they informed the plaintiff that they are not agreeable on selling the suit property. It has also come on record in the cross-examination of the defendant No,1 that another meeting also took place with the estate broker Amjad wherein son of the defendant No,1 and his friend went to the broker Amjad so that he may persuade the plaintiff to agree on putting an end to sale agreement. Thus it has come in evidence that prior to expiry of date for the performance of the contract, it was the defendant No,1 who sought cancellation of the contract which prompted the plaintiff to file present suit prior to cut off date i.e, 8-5-2004. It has also come in evidence that when the plaintiff entered into sale agreement, he arranged sale consideration by selling a plot of 400 sq. Yd., in the neighbourhood of suit property. Counsel for the defendant No,1 in reply has argued that the plaintiff failed to demonstrate that he had entire sale consideration with him. He argued that no notice was issued to the defendant No 1 calling upon him to complete the sale transaction. He further contended that while obtaining injunction order from this Court, only 25% of the remaining sale consideration was deposited and the balance was deposited in 2006 and this delay by itself shows that the plaintiff did not have entire sale consideration with him to complete the sale transaction. He argued that on the other hand the defendant No,1 from his conduct has demonstrated that he neither sold suit property to any one else nor invited offers for the same. He therefore submitted that the suit may be dismissed.
4. Learned counsel for the defendant No,1 relied upon PLD 1959 Karachi 629, 2007 YLR 1027, 1999 MLD 3345, 2004 MLD 1033, AIR 1930 Patna 121, PLD 1986 SC 497 and 2005 YLR 1905. In the first case it has been held by this Court that buyer has to show that he is ready and willing to perform his part of obligation on the date on which payment is to be made under the agreement to sell. Second case pertains to grant of injunction. It was held that since the plaintiff has not complied with the directions to deposit the sale transaction in Court, he was not entitled for grant of interim relief.
Interim injunction granted earlier was thus vacated. In the third and fourth case it has been held that where buyer has himself never approached the seller to complete the sale transaction, he has failed to establish his ready and willingness to perform his part of contract. In the fifth case it has been held that the plaintiff has taken no step after expiry of sale transaction to come forward and seek performance of the contract. In the case of AIR 1927 Patna 121, it was held that ready and willingness has to be demonstrated at all material times. Same principle has been laid down by this Court in a Supreme Court case reported in 2005 YLR 1905.
5. In the present case, it has come on record that before expiry of the date of performance, the plaintiff has admittedly approached the defendant No,1 for seeking completion of the transaction but it was the defendant No,1 and his family members who refused to complete the sale transaction and sought cancellation of contract. It has also come on record that son of the defendant No,1 and his friend approached the estate agent in order to get sale transaction cancelled as the family members of the defendant No,1 had second thoughts as they decided not to sell the suit property. In view of this evidence where there is categorical refusal on the part of seller to honour his contractual commitment, the plaintiff deemed appropriate not to wait further for seeking completion of transaction as it would have been an exercise in futility. On the basis of categorical refusal prior to cut off the date, the plaintiff was fully justified in filing the present suit.
The fact that at some stage while seeking injunctive order, extension in time for deposit of amount was sought by the plaintiff, cannot be regarded as failure of the buyer to demonstrate his ready any willingness to perform his part of contract. The question of examining ready and willingness of the buyer becomes material when the seller has himself not refused to complete the transaction, which is not the case here. Here there was categorical refusal to perform on the part of the defendant No,
1. Thus where there is clear refusal on the part of the seller to complete the sale transaction, then there is no occasion for the buyer to show that he has cash available with him to purchase the property. Test of ready and willingness is to be judged only when purchaser calls upon the seller to complete the transaction and the buyer avoids or refuses to come forward and completes the sale transaction. It is an admitted position that time was not made essence of the contract. Where there is failure on the part of the buyer to complete the transaction and time is also not made the essence of contract then it is for the seller to make time essence of the contract by fixing reasonable time for peat nuance of the contract where after if buyer fails to complete the transaction, the contract comes to an end. In the case reported in PLD 1962 SC 1, it has been held that it is for the seller to make time essence of contract by first calling upon the buyer to complete the transaction within reasonable time. Otherwise contract stands terminated if the buyer fails to complete the transaction in spite of grant of reasonable time. A contract also comes to an end without notice where the buyer himself refuses to complete the transaction, which is not the case here. In the present case the notice for termination of contract was dispatched to the plaintiff by the defendant No,1 on 12-5-2004 i.e, after 4 days of expiry of contract period without granting any time to the plaintiff to complete the transaction. In view of this factual position, neither suit was filed prematurely nor there was failure on the part of the plaintiff to complete the sale transaction. On the contrary it was the defendant No,1 who prior to expiry of date of agreement had second thought on account of family pressure and refused to perform his part of obligation. Therefore issue Nos.2 and 3 answered accordingly.
6. Rescission of contract by the defendant No,1 through notice dated 12-5-2004 was therefore contrary to the principles laid down in the Supreme Court's judgment reported in PLD 1962 SC 1. Hence the suit is decreed. The defendant No,1 is directed to transfer the suit property in the name of the plaintiff within 30 days. In case the defendant No,1 fails to transfer the same, Nazir of this Court shall execute sale-deed on behalf of the defendant No,1 in favour of the plaintiff and upon execution of sale-deed, Nazir shall pay the amount already deposited with him to the defendant No,1 along with profit accrued thereon. The alternate prayer for damages is denied.