' IJAZ-UL-AHSAN, J.---This revision petition arises out of an order passed by the learned Civil Judge, Lahore on 7-1-2008. Through the said order, the learned trial Court dismissed an application moved by the petitioner under Order VII rule 11, C.P.C. For rejection of the plaint.
2. The petitioner and the respondent entered into an agreement to sell in June, 2004 relating to sale of a plot of land measuring 15.2 Kanals situated at Ferozepur Road, Lahore. It was stated in the agreement that the plot in question stood mortgaged in favour of MCB Bank against certain finance and banking facilities availed by GA Steel Re-Rolling Mills, Ferozepur Road, Lahore of which the petitioner is the proprietor. Under the agreement, the petitioner undertook various obligations including getting the mortgaged property released from the mortgage of the Bank, clearance of their liability against the property and issuing of a general power of attorney in favour of the purchaser on fulfilment of other terms and conditions mentioned in the said agreement.
3. It was also clearly stated in paragraph 3 of the agreement that the property in question had been sold in execution of a decree passed in favour of MCB Bank in the sum of Rs,5,964,000 for a sum of Rs,23,200,000 and the auction conducted for sale of the property was yet to be confirmed.
In paragraph 5 of the agreement, a schedule of payments was given. The respondent was required to make the payments mentioned in the schedule on behalf of the petitioner to satisfy the decree of the Bank. The record shows that a sum of Rs,7,640,285 was deposited by the respondent through various cheques, at various times, with Banking Court II, Lahore. The cheques were encashed and the amount is admittedly lying with the said Court. The petitioner had agreed to complete the transaction on receipt of the balance sale consideration, but appears to have changed his mind.
4. It may be pointed out that according to the agreement between the petitioners and the respondent, the aggregate sale consideration was Rs,36,240,000 calculated at the rate of Rs,2.4 million per Kanal.
5. The respondent on coming to know that the petitioner was having second thoughts regarding the afore-said transaction and had also made an attempt to withdraw the sums deposited by the respondent with the Banking Court pursuant to agreement dated 7-6-2004, filed a suit for specific performance of agreement dated 7-6-2004 before the Civil Courts at Lahore. At a subsequent stage, the prayer in the plaint was amended to the effect that in addition to seeking a decree for specific performance, an alternate relief was claimed by way of a decree for recovery of Rs,88,210,425 as damages in terms of clause 10 of the agreement to sell. The alternate relief appears to have been added to cater for a situation where the civil Court may, for any reason, decline to pass a decree for specific performance.
6. The suit lingered on before the learned civil Court for a considerable period of time. Ultimately, on 4-4-2007, the petitioner filed an application under Order VII rule 11, C.P.C. Seeking rejection of the plaint. The main ground taken in the application was that the suit was hit by the provisions of section 7(4) read with section 23(2) of the Financial Institutions (Recovery of Finances) Ordinance, 2001 (FIO). The respondent contested the application. After hearing both the sides, vide order dated 7-1-2008, the learned trial Court dismissed the application. This order is assailed by the petitioner before this Court.
7. The learned counsel for the petitioner submits that the property, which is subject-matter of the suit, is admittedly mortgaged with MCB Bank. The respondent was all along aware of such mortgage, which was clearly disclosed in the agreement to sell. As such, the suit cannot proceed, in view of the exclusive powers conferred on the Banking Court to entertain and adjudicate upon matters involving properties which stood mortgaged in favour of a Bank to secure finance and banking facilities availed by a customer. In this regard, the learned counsel has referred to section 23(1) of the FIO which envisages that a customer cannot, without the prior written permission of the Banking Court, transfer, alienate, encumber, remove or part with possession of any of his assets or property furnished to a financial institution as a security by way of mortgage, pledge, hypothecation, charge, lien or otherwise, pending final decision of the suit filed by the Financial Institution under the FIO.
8. The learned counsel has relied on 2006 CLD 771 in support of his contention that the property in question cannot be sold in favour of the respondent in view of the bar provided in sections 4 and 23 of the FIO.
9. The learned counsel for the respondent has raised a preliminary objection to the effect that the petitioner was under an obligation to support his revision petition with pleadings, documents and orders of the learned subordinate Court. He has pointed out that the petitioner has intentionally concealed and withheld a copy of the agreement to sell dated 7-6-2004, which was a material document to decide the controversy between the parties. Therefore, relying on PLD 1995 Lahore 598, the learned counsel has argued that the petition is liable to be dismissed for want of supporting documentation. It has further been pointed out that the respondent had admittedly deposited amounts in excess of the decretal amount with the Banking Court and the interests of the Bank were adequately secured. He has claimed that the decree-holder Bank was taken into confidence relating to this transaction and the Bank had no objection to the same in view of the fact that sufficient funds to satisfy the decree had been deposited by the respondent with the learned Banking Court.
10. The learned counsel for the respondent has also drawn my attention to section 2(c) of the FIO to argue that in order to approach a Banking Court, the plaintiff must establish that he is either a customer or a person, on whose behalf a guarantee or letter of credit has been issued by a financial institution or a surety or indemnifier. He submits that the petitioner does not fall within any of the afore-said definitions and would not be entitled to avail the benefit of remedies provided under the FIO or approach the Banking Court for redressal of his grievance. Reference in this regard has been made to 2003 CLD 363, 2003 CLD 1843 and 2003 CLD 1026.
11. The precise question requiring determination by this Court is, whether, under the facts and circumstances of this case, the jurisdiction of a civil Court to entertain a suit is barred.
12. The suit filed by the respondent is based upon an alleged agreement to sell. The petitioner denies existence of any such agreement. It is therefore, a matter to be determined after recording of evidence, whether or not the parties entered into any such agreement. After having denied the agreement, the petitioner cannot take the position either that the agreement is void or that such agreement falls within the exclusive jurisdiction of the Banking Court in terms of section 7(4) and section 23 of the FIO. It is settled law that a party cannot approbate and reprobate in the same breath.
13. A perusal of copies of evidence recorded by the learned trial Court indicates that substantial payments were made by the respondent through banking channels. Such payments had been received by the learned Banking Court and are being held by it. In this regard, Manager, Bank Al- Habib, Mall Road Branch, Lahore, representative of Bank Alflah, Gulberg Branch, Lahore, representative of Saudi Pak Commercial Bank, Gulberg Branch, Lahore and a number of other witnesses have been examined by the respondent in addition to production of cheques and account statements to show that the amounts claimed to have been paid by the respondent, have indeed been paid by the respondent and received by the learned Banking Court. Interestingly enough, MCB Bank has not, to safeguard whose interests the provisions of sections 7(4) and 23(2) have been incorporated in the FIO, raised any objection against this transaction at any stage. The learned counsel for the petitioner has not referred to any objection having been raised by the auction-purchaser either. It appears that if at any stage the auction is not confirmed, the additional sums, required to be paid to the auction purchaser under the law, have also been paid/agreed to be paid by the respondent. The petitioner is therefore estopped from taking a contrary position at this stage when the respondent, in reliance on the representations and promises of the petitioner, has taken positive steps, including deposit of substantial sums of money, on his behalf, with the learned Banking Court. There is, therefore, sufficient evidence already available on record to prima facie substantiate the stance being, taken by the respondent.
14. A perusal of the record, evidence recorded and averments made in the plaint as well as in the application under Order VII rule 11, C.P.C. Moved by the petitioner, points towards the fact that the respondent/plaintiff seeks enforcement of the obligations undertaken by the petitioner. These included getting the property released from the mortgage by satisfying the decree passed by the Banking Court by utilizing the funds provided by the respondent and thereafter taking certain other consequential steps. In my opinion by entering into the agreement in question, the petitioner has not violated the provisions of section 23(2) insofar as he has not transferred, alienated, encumbered or parted with possession of the mortgaged property. At best he has undertaken to pay the Bank, get the property released and thereafter transfer the same in favour of the respondent. This does not constitute violation of the provisions of the F10.
15. It is evident from the record that the respondent has fulfilled his part of the bargain. Payments have been made through banking channels, the same have been received by the petitioner as well as the Banking Court and the property in question has neither been sold nor encumbered in violation of section 23(2) of the FIO. An agreement to sell does not create any interest in or charge on immovable property. It only creates a right to obtain another document conferring title in respect of immovable property mentioned therein. This proposition of law is well-settled. Dicta laid down in 2002 SCM R 1089 and 2008 SCM R 510 provide useful guidelines in this regard.
16. As far as the plea of the petitioner that being only a co-sharer he could not have agreed to sell the entire property is concerned, suffice it to say that a co-sharer can sell property to the extent of his share. This principle of law has elaborately been discussed in 1995 SCM R 514 and can usefully be referred to in support of this proposition. In any event, the question, whether or not the petitioner was duly authorized by the co-sharers, as alleged by the respondent, is a question of fact. This issue will be determined by the learned trial Court after recording of evidence.
17. The petitioner has not come to this Court with clean hands. He seeks to take benefit of certain actions taken by him, which he now claims are illegal and void. At the same time, he is making attempts to reap a premium by depriving the respondent of substantial sums of money, which have admittedly been paid by the respondent on his behalf and at his behest, on the faith of representations and promises made by the petitioner. This Court cannot become privy to such unethical practices adopted by the petitioner. The judgments relied upon by the learned counsel for the petitioner are distinguishable. They have their own peculiar facts and are not intended to lay down the entire law on the subject. The same are of no help to the petitioner.
18. There is yet another aspect of the matter. It is evident from a reading of the prayer in the suit filed by the respondent that he has sought specific performance of an agreement or in the alternative claimed damages. The respondent has no nexus or connection with the decree-holder Bank and does not fall within the definition of customer. It is for the trial Court to look into the intricate questions of law and fact involved in the matter, which can only be done after a full trial and recording of evidence. Admittedly, there are valuable rights of the parties involved in this matter. Technicalities and legal provisions are meant to advance and not obstruct justice.
Proceedings before the learned trial Court cannot be stifled at this stage by putting the lis under the guillotine of technicalities. Admittedly, the trial is at its initial stages. The parties will have ample opportunity to bring the relevant material on record and raise all pleas available to them under the applicable laws during the trial. In the facts and circumstances of the case, I am of the opinion that this is certainly not a still born suit that needs to be thrown out at its initial stage to save unnecessary wastage of judicial time.
19. The learned counsel for the petitioner has failed to point out any misreading or non-reading of material available on record or any illegality or material irregularity in the impugned order of the learned trial Court.
20. The observations made in this judgment are of a tentative nature only, based upon material available before this Court, which has been examined to resolve the limited questions raised before it. The learned lower Court will proceed with the trial without being influenced by any observations made herein, by independent application of mind to the material before it and strictly in accordance with law.
21. This revision petition has no merit. It is accordingly dismissed.