1. ' MUHAMMAD ALI MAZHAR, J.---This application is brought under Order VII, Rule, 11, C.P.C. By the defendant No,4 for the rejection of plaint. The plaintiff has filed this Suit for declaration, specific performance and permanent/perpetual injunction with the following prayers:--
(i) To declare that the Sale Agreement dated 11-7-1996 executed between the parties in respect of plot of land bearing No,2, Row No,7, Block-2, PECHS, Karachi, is legal, valid and is binding upon the parties, their legal representative, heirs, attorneys, sub-attorneys, successors-in-interest, transferees and persons claiming any interest or authority through them.
(ii) To issue permanent injunction restraining the defendants, their legal representatives, heirs, attorneys, sub-attorneys, successorsin-interest, transferees and persons claiming any interest or authority through them not to illegally dispossess the plaintiff from the above said plot of land or to interfere with peaceful possession of the plaintiff on the plot without due process of law.
(iii) To pass judgment and issue decree requiring the defendants Nos.1, 2 and 3, their legal representatives, heirs; attorneys, subattomeys, successors-in-interest, transferees and persons claiming any interest or authority through them to specifically perform their respective duties and liabilities under the above said sale agreement dated 11-7-1996.
2. OR ' That in case this Hon'ble Court due to any implication, considers it non-feasible and inconvenient to grant implementation of the agreement dated 11-7-1996, then, in the alternative, it is prayed that the plaintiffs be paid a sum of Rs,13,00,000 (Rupees thirteen lac only) in terms of the agreement with mark-up at current rate by the defendants Nos.1 and 2 jointly and individually in view of the fact that the plaintiff, being a bona fide purchaser for value, nay not be compelled to suffer loss due to manipulation of the defendants.
3. ' The defendant No,4 in this application inter alia puts forward that the plaintiff has filed the suit for Specific Performance of Contract dated 11-7-1996 which was performable subject to plaintiff's obtaining sale permission from the Ministry of Works, Government of Pakistan, Islamabad. The sale permission of the suit plot was impossible in view of the provisions contained in sub-license agreement and the original sale agreement dated 8-7-1996. In the contract dated 11-7-1996 it was further stated that in any circumstances this deal is cancelled from the seller's side, he will refund the advance amount in double. Besides the plea of specific performance, the plaintiff has also claimed damages as an alternate prayer in the suit. Learned counsel for the defendant No,4 argued that the suit is barred under section 21(a) of the Specific Relief Act, sections 36 and 56 of the Contract Act and section 70 of the Cooperative Societies Act, 1925 for want of notice to the Registrar.
4. ' Section 36 of the Contract Act, provides that Contingent agreement to do or not to do anything, if an impossible event happens, are void, whether the impossibility of the event is known or not to the parties to the agreement at the time when it is made. He also referred to section 56 of the Contract Act which provides that an agreement to do an act impossible in itself is void. A contract to do an act which, after the contract is made, becomes impossible, or, by reason of some event which the promisor could not prevent, becomes void when the act becomes impossible or unlawful. It is further provided in the same section that where one person has promised to do something which he knew, or, with reasonable diligence, might have known, and which the promisee did not know to be impossible or unlawful, such promisor must make compensation to such promisee for any loss which such promisee sustains through the non-performance of the promise. The learned counsel further argued that the plaint is liable to be rejected because the plot agreed to be sold was an amenity plot and according to terms of lease its use cannot be converted from amenity to other use. In support of his arguments, the learned counsel relied upon a judgment reported in 2006 CLC 1110 (Chaudhary Muhammad Sarwar through L.Rs v. Mst.Aimna Bibi and others) in which section 56 of the Contract Act was considered and held that agreements, the performance of which was prayed in suit having become void i,e, impossible of performance, the only course open for the plaintiffs was to sue the defendants for loss, if any, sustained by them on account of their non- performance and for return of their advance money. Another judgment is reported in 2004 CLC 1302 (Haji Khudai Dad v. Ghulam Yaseen) in which the Divisional Bench of Baluchistan High Court has held that where the performance of agreement becomes impossible and the vendor failed to perform due to refusal of the Municipal Corporation to transfer the title in the name of the respondent as such, the agreement between the parties became void and under section 65 of the Contract Act, the respondent was entitled to claim return of the money which the appellant is bound to restore.
5. ' In response, the learned counsel of the plaintiff drawn the attention of this Court to the sale agreement dated 11-7-1996 in which he has pointed out that initially it was the responsibility of the vendee to get the NOC from the concerned authority within 90 days, however, in the second paragraph it is clearly agreed that in case of non-compliance on the part of vendee, the vendor will clear all the dues and other charges of the plot till the date, and if any matter remains to be resolved then the vendor will finalize the same from his side. It was further agreed in the agreement that in case the deal is cancelled due to default of seller then he will refund the advance amount in double as penalty. Learned counsel further argued that in the prayer clause, the plaintiff has already claimed that if due to any implication, the implementation of agreement dated 11-7-1996 is found unenforceable then as an alternate relief, the defendants Nos.1 and 2 be directed to pay rupees thirteen lac in terms of agreement with mark-up at current rate. Learned counsel for the plaintiff has also pointed out a letter dated 11-11-1996 written by Hony. Secretary PECHS to defendant No, 1 in which it was stated that the plot in question is non-transferable and in the present situation the application cannot be entertained, however, the allottee of plot may request for NOC for registration of power/sub-power of attorney in respect of the plot, provided he completes all the prerequisites. In another letter dated 11-6-1998, the honorary Joint Secretary, PECHS Ltd. Stated that the plot in question is an amenity plot and he further stated that the proper forum for decision of the dispute is the Court of law which the plaintiff has already adopted. Finally, he argued that for deciding an application Order VII, Rule 11, C.P.0 only averments of the plaint may be taken into consideration and unless the issues are settled and evidence is led, the controversy between the parties cannot he decided and resolved.
6. ' Heard both the learned counsel for the parties at length. The bone of contention between the parties is whether an amenity plot can be sold or transferred and if not, then whether the claim of compensation / penalty lodged by the plaintiff is maintainable or not. It would be expedient to reproduce the aforesaid provisions for convenience and for the sake of ready reference as under:- - Section 21 of the Specific Relief Act, 1877.
7. Contracts not specifically enforceable:---The following contracts cannot be specifically enforced:--
(a) a contract for the non-performance of which compensation in money is an adequate relief.
8. (b)' .................................................................................
9. (c): ................................................................
(d) ..............................................
(e) ........................................
10. (g)
11. (h)
12. And, save as provided by the {Arbitration Act..................
13. CONTRACT ACT, 1872 36.Agreement contingent on impossible events void.-- -Contingent agreements to do or not to do anything, if an impossible event happens, are void, whether the impossibility of the event is known or not to the parties to the agreement at the time when it is made.
56. Agreement to do impossible act.---Agreement to do an act impossible in itself is void.
14. Contract to do act afterwards becoming impossible or unlawful.---A contract to do an act which, after the contract is made, becomes impossible, or, by reason of some event which the piomisor could not prevent, unlawful, becomes void when the act becomes impossible or unlawful.
15. Compensation for loss through non-performing of act known to be impossible or unlawful.--- Where one person has promised to do something which he knew, or, with reasonable diligence, might have known, and which the promisee did not know to be impossible or unlawful, such promisor must make compensation to such promisee for any loss which such promisee sustains through the non-performance of the promise.
65. Obligation of person who has received advantage under void agreement or contract that becomes void.---When an agreement is discovered to be void, or when a contract becomes void, any person who has received any advantage under such agreement or contract is bound to restore it, or to make compensation for it through the person from whom he received it.
16. ' The contention of learned counsel for the plaintiff is correct to the extent that specific performance of the contract in view of the letter of PECHS is apparently impossible, it is clear beyond any shadow of doubt, that the land in question was an amenity plot and this was the reason in the sale agreement that a specific clause was incorporated and responsibility was shifted upon the plaintiff to get the NOC from PECHS for the transfer of plot which was not done. In the prayer clause the plaintiff has claimed the declaration that the agreement dated 11-7-1996 is legal and valid binding upon the parties and further direction to the defendants Nos.1, 2 and 3 to specifically perform their duties and liabilities under the said sale agreement. However, an alternate relief has also been claimed that if implementation is not possible then a sum of Rs,13,00,000 may be paid to the plaintiff by the defendants Nos.1 and 2. The possibility of implementation of the agreement or its enforceability issue will be seen after framing of issues and in case the court reaches to the conclusion that the agreement cannot be implemented or specifically enforced, the alternate prayer may be awarded subject to prove of entitlement after evidence in the matter. It is clearly provided under section 21 clause (a), that a contract for non- performance of which compensation is money is adequate relief cannot be specifically enforced.
17. Specific performance is an equitable relief which cannot be granted as a matter of course or as a matter of right but it is the discretion of the court to be exercised on the basis of established sound judicial principles and upon consideration of all circumstances of each particular case. No doubt that section 36 of the Contract Act provides that contingent agreement to do or not to do anything, if an impossible events happens are void but at the same time, an important aspect cannot be over sight that section 65 of the Contract Act simultaneously provides that when an agreement is discovered to be void or when a contract becomes void, any person who has received any advantage under such agreement is bound to restore it or make compensation for it to the person from whom he received it. Though section 36 is focused on the consequences of a contingent agreement to be void if impossible events happens but it cannot be read in isolation. If any agreement declared to be void keeping in view the conditions enumerated under section 36, simultaneously, it is also an obligation on the part of a person who has received any advantage is bound to restore it or to make compensation for it to the person from whom he received it. This section embodies rules of equity and doctrine of restitution interregnum. Section 65 also applies to an agreement that it void ab initio, provided the agreement is discovered to be void or becomes void after it had been entered into. According to a judgment of Divisional Bench of this court reported in PLD 1968 Karachi 196 (Province of West Pakistan v. Asghar Ali Muhammad), application of section 65 of the Contract Act is not restricted to executory contracts but can be pressed into action even.Where contract has been performed. Indeed when is provides for making a compensation in respect of the advantage which may have been received, it must follow that cases would frequently arise where an agreement or a contract may have been performed . And yet it may become necessary to order restoration in the form of compensation. In another judgment reported in PLD 1947 PC 213, (Govindram Sksaria v. Edward Radbone), the Privy Council held that under section 65 alternatives are to restore any advantage or to make compensation for it to the person from whom he received it. This must mean valuing or quantifying in money the advantage retained, if retained it be. The next question relates to section 56 of the Contract Act which embodies a positive rule of law relating to doctrine of frustration. It contemplates that a contract may be void under its provisions and yet compensation may be payable by the person, 'who is unable to perform it, whether the impediment is impossibility or unlawfulness and whether the impediment existed at the time of contract or supervened. The doctrine of frustration known to English law has been statutorily recognized in this section. Section 65 applies to the cases of physical impossibility. A subsequent unforeseen events or contingency for which neither of the parties is responsible. The judgments relied upon the learned counsel for the defendant No,4 are also based on the same footing and held that agreements, the performance of which was prayed in suit having become void i,e, impossible of performance, the only course open for the plaintiffs was to sue the defendants for loss, if any, sustained by them on account of their non-performance and for return of their advance money. In another judgment also, the Divisional Bench of Baluchistan High Court has held that where the performance of agreement becomes impossible and the vendor failed to perform, the vendee was entitled to claim return of the money which the vendor is bound to restore. After mature consideration, it is clear that if at the end of this litigation, the court reaches to the conclusion that the agreement/contract was void or it cannot be specifically enforced, the next consideration will be diverted towards the alternate prayer as to whether the plaintiff is entitled to any compensation or penalty including the refund of earnest money with markup or without markup. If at this premature stage, the plaint is rejected, the alternate prayer, clause will be seriously prejudiced and frustrated.
18. ' It is well-settled and old age principle that for the rejection of plaint, only the contents of the plaint can be looked into. The suit does not appear to be barred by provisions of sections 21(a), of the Specific Relief Act and sections 36, 56 or 65 of the Contract Act. In the judgment reported in 2008 SCMR 236 (Mrs. Anis Haider and others v. S. Amir Haider and others), the Hon'ble Supreme Court has held that pleadings of parties could not be taken as evidence particularly when its maker was not even examined in its support and cross-examined by his opponent. Order VII Rule 11, C.P.C. Can be attracted only when a plaint itself does not disclose any cause of action. It cannot be rejected on the basis of Written Statement because the initial burden remains on the plaintiff to prove his case on the basis of assertions made in the pleadings. If the principle in hand adopted by the Courts below is endorsed, it would be the easiest thing to dismiss any civil suit simply and merely on the basis of written statement. The Hon'ble Supreme Court in its another judgment reported in 1991 SCMR 2030 (Haji Mitha Khan v. Muhammad Younus and others) has held that the test of cause of action is that if what plaintiff has stated is taken to be correct, is he entitled to relief or not. In another judgment reported in 1995 SCMR 459 (Haji Allah Bakhsh v. Abdul Rehman and others), the Hon'ble Supreme Court has held that in order to press into service the provisions of Order VII, Rule 11, C.P.C., the averments contained in the plaint are to be presumed to be correct. On the above assumption, the plaint is to be examined and if the case falls under any of the clauses (a), (b), (c) and (d) of Rule 11 C.P.C., the plaint is liable to be rejected. In the same lines, the honourable Supreme Court has held in the case reported in 1990 SCMR 1630 (Ghulam Ali v. Asmatullah), that the assertion made in the plaint had to be seen for the purposes of determining whether plaint disclosed any cause of action. Lack of proof or weakness of proof in circumstances of the case did not furnish any justification for coming to conclusion that there was no cause of action shown in the plaint. In another judgment reported in 1994 SCMR 826 (Jewan v. Federation of Pakistan), the Hon'ble Supreme Court has held that while taking action for rejection of plaint under Order VII, Rule 11, C.P.C., the Court cannot take into consideration pleas raised by the defendants in the suit in his defense as at that stage the pleas raised by the defendants are only contentions in the proceedings unsupported by any evidence on record. However, if there is some other material before the Court apart from the plaint at that stage which is admitted by the plaintiff, the same can also be looked into and taken into consideration by the Court while rejecting the plaint.
19. ' The learned counsel for the defendant No,4 also argued that the suit is barred under section 70 of the Co-operative. Societies Act which reads as under:-- Cooperative Societies Act, 1925 Section 70: Notice necessary in suits.---No suit shall be instituted against a society or any of its officers in respect of any act touching the business of the society until the expiration of two months next after notice in writing has been delivered to the Registrar or left at his office, stating the cause of action, the name, description and place of residence of the plaintiff and the relief which he claims; and the plaint shall contain a statement that such notice has been so delivered or left.
20. ' So far as the implication and, intricacies of section 70 of the Cooperative Societies Act, is concerned there is no relief claimed by the plaintiff against the P.E.C.H.S (defendant No,3). If the court at any stage reaches to the conclusion that no relief for the declaration or specific performance is possible the suit will remain only for compensation or penalty as alternatively claimed in the suit. In a judgment of this court repotted in 2001 YLR 882 (Karachi) (Tamizul v.
21. Waheed Akhtar and others), it is held that provision of S.70 of Cooperative Societies Act, 1925, is attracted only to the acts touching the business normally carried on by the Society. Averments in the plaint were not touching the business of Cooperative Society. Dispute was regarding delay in mutation of record in favour of the plaintiff and cause of action was against specific acts of some defendants. Where from the averments made in the plaint, the plaintiff had disclosed cause of action against the defendants and the plaint was not hit by the provisions of S.70 of the Cooperative Societies Act, 1925, the suit was maintainable. In another judgment of this court reported in PLD 1987 Karachi 676, (Nizar Ali v. Nooriabad Co-operative Housing Society Ltd). The learned Single Judge of this court has held if suit is not relating to any act touching business of society nor plaintiff showing any dispute the nature of which could attract bar of jurisdiction. Suit without notice was maintainable in circumstances. Before an objection about the maintainability of the suit for want of notice under section 70 of the Act is taken, it must he shown that the dispute is in respect of any act touching the business of the society. In order to determine this fact the Court has only to consider the averments made in the plaint. The plaint does not disclose any dispute touching the business of the society. The relevant provision of section 54 of the Act is that between members or past members of the Society or persons claiming through a member or past member. When there is no dispute between the parties relating to the business of a society then the suit without any notice is maintainable. Under Order VII, rule 11, Civil Procedure Code, 1908, a suit is not dismissed but the plaint is merely rejected. This makes a big difference with respect to the consequences that follow. Moreover, in asking the Court to reject a plaint under this provision, the defendant must be taken to admit for the sake of argument that the allegations of the plaintiff E made in the plaint are true in manner and form. The Court should reject the plaint under this provision only if it comes to the conclusion that even if all the allegations which are made in the plaint were proved to be correct, the plaintiff will not be entitled to get the relief. In the present case, on one hand, the defendant No,4 raised the objection that an amenity plot cannot be sold or transferred while in his own application moved under Order I, Rule 10, C.P.C., (C.M.A No, 311 of 2004), it has been claimed that the defendant No,4 has purchased the said amenity plot from the defendants Nos.1 and 2. Along with the application, the defendant 'No,4 has also attached copy of sale agreement to show that he is bona fide purchaser of an amenity plot. The position of the defendant No,4 is not different than of the plaintiff. Both are fighting for the transfer of an amenity plot and entered into different agreements to sell with the defendant No,1 and in both agreement PECHS is not party. In fact vide letter dated 11-6-1998, Society has already declared that amenity plot cannot be transferred or sold and society has no concern with the private affairs. It is well- settled law that the land use of amenity plot cannot be converted into any commercial or residential use. The Society has candidly refused the transfer of amenity plot before lease and in this suit also, no relief is claimed apinst the society, except to specifically perform its duty. Society has already clarified and performed its duty to say that amenity plot cannot be transferred. The plaintiff and other defendants have direct dispute against each other on account of their private dealings which has nothing to do with the business of Society and they cannot compel to ask the transfer of amenity plot by the Society on the basis of private deals or agreements in contravention of its byelaws or sub-license terms. The purpose and concept of amenity plot is not to make profit but it is reserved for larger public interest and community. In all conscience, at this stage, the suit does not appear to be barred under section 70 of the Co-operative Societies Act, however, at the time of settlement of issue, if required, a separate issue may be framed in connection with section 70 of Co-operative Societies Act vis-a-vis the relief(s) claimed by the plaintiff in the suit. At present, the presence of society is necessary in the larger public interest as the dispute between the parties relates to an amenity plot and its transfer on the basis of agreement by a private allottee. Though in paragraph (2) of the plaint, the plaintiff has mentioned that the plot in question was allotted to defendant No,2 for school purpose but neither in the sale agreement of the plaintiff any use of plot is mentioned nor in the agreement to sell of the defendant No,4 any use of plot is pointed out.
22. When the society has refused the transfer in favour of the plaintiff then at the same time it is to be seen as to how the same amenity plot can be transferred to the defendant No,4. If the plaint is rejected against the Society in the peculiar circumstances of the case, the public at large will suffer and there is likelihood of misuse of an amenity plot reserved in the scheme for the public interest, therefore, the presence of society is otherwise necessary keeping aside the intricacies of section 70 of the Co-operative Societies Act and in my view, P.E.C.H.S is proper and necessary party to defend the misuse of amenity plot if any.
23. ' After hearing the pros and cons of the matter, the bottom line of the above discussions is that the application under Order VII, Rule 11, C.P.C. Is dismissed. Since many disputed questions of facts are involved which cannot be resolved without evidence, the parties are directed to file their proposed issues for further proceedings.