1. C.M.A. No. 2617 of 2007 NADEEM AZHAR SIDDIQI, J. --- By this application the defendants have prayed for rejection of the plaint.
2. The plaintiff has filed this suit for declaration, injunction and recovery of damages of Rs. 104.98 million. The facts as pleaded in the plaint are that the plaintiff was a Director of Defendant No. 2 holding 37% shares and vide minutes of Directors of Defendant No. 2 held on 26.10.2002 agreed to sell his 37% shares to Defendant No. 1 against consideration of Rs. 57.35 million. It was alleged in the plaint that no payment towards the sale of 37% share in the properties and assets of Defendant No. 1 was paid to the plaintiff except payment of Rs. 3,37,000/- being the face value of 37000 share certificates of Defendant No. 1.
3. The defendants have filed their joint written-statement wherein apart from raising technical please they state that the entire sale consideration of Rs. 57.35 million was paid to the plaintiff within the stipulated period of three months. The value amounting to Rs. 57.35 million of the plaintiffs 37% shares in the Defendant No. 2 was mutually evaluated after including the prevailing market value of immovable properties, consolidated assets and goodwill of Defendant No. 2. The plaintiff after receipt of entire sale consideration executed Annexures P/2' and 'P/3' whereby relinquishing his right of signing authority in Defendant No. 2 and transferring his share in Defendant No. 2 in favour of Defendant No. And his were respectively and had executed transfer deeds in respect of 37000 shares in favour of Defendant No. 2. The defendants alleged that plaintiff has kept mum for over a period of three years and the plaintiff has not come to Court to blackmail and harass the defendants.
4. The Defendants have filed application under Order VII, Rule 11, C.P.C. Pleading therein that the plaintiff has no cause of action for the reason that entire sale consideration of shares was paid to the, plaintiff and that the suit is time-barred as in the plaint the cause of action has been shown to be accrued in October, 2002 and March, 2003.. Whereas the suit was filed in November, 2006 after a period of three years.
5. The plaintiff has filed counter-affidavit to the application under Order VII, Rule 11, C.P.C. The plaintiff admits that he agreed to sell his 37% shares in the assets and properties of defendant No. 2 against sale consideration of Rs. 37.35 million and submits that except Rs. 3,70,000/-no other payment was made. The plaintiff submits that cheques of Rs. 16,50,000/- and Rs. 90,00,000/- issued by Defendant No. 2 on account of discharge of outstanding amount of loan payable by the it. The plaintiff also submits that payments of Rs. 5, Rs. 4 and Rs. 10 millions were made for different purposes. He submits that payment under receipts dated 27.11.2002 and 28.11.2002 were made by Sabir Usman at the request of Defendant No. 1. Regarding third receipt of Rs. 10 million he submits that the payment was made by the Defendant No. 1 in discharge of his liability towards various outstanding. The plaintiff denied that the suit is barred by limitation.
6. The defendants have filed affidavit-in-rejoinder and the plaintiff has also filed replication.
7. Mr. Rafiq Ahmed Kalwar, learned counsel for the defendants, submit that the suit was filed on the basis of agreement for sale of shares and the plaintiff after receipt of entire sale consideration executed two agreement deeds dated 5.3.2003 by which the plaintiff has relinquished his authority to sign on behalf of Defendant No. 2 and has also admits that he has no right and interest in the properties of the company (Defendant No. 2). He referred to the various document annexed with the written-statement and submits that in view of the judgment reported as S.M. Shafi Ahmed Saidi v. Malik Hassan All Khan (2002 SCMR 338) the documents annexed with the plaint can also be considered while dealing an application under Order VII, Rule 11, C.P.C. He further submits that the documents annexed with the written statement clearly established that the plaintiff has received the entire sale consideration under the Board Resolution dated 26.10.2002 and has no cause of action to file this suit and the same has been filed in lust of money. He submits that main relief under the plaint is recovery of amount under Board Resolution dated 26.10.2002 and damages the limitatio._; of filing of a suit is three years. He has referred to para 18 of the plaint and submits that the plaintiff himself claims that cause of action accrued on 26.10.2002 and 5.3.2003 and the notice given on 9.8.2006 after expiry of the period of limitation has no legal effect. He relied upon the following reported cases:---
(1) S.M. Shafi Ahmad Zaidi v. Malik Hassan Ali Khan (2002 SCMR 338).
(2) Farzand Ali and another v. Fateh Muhammad (2005 CLC 1223).
(3) M/s. Imperial Builders and another v. Lines (Pvt.) Limited and others (PLD 2006 Karachi 593).
(4) M/s. Mateen Corporation v. M/s. Plasticrafters (Pvt.) Ltd. (PLD 2006 Karachi 621).
(5) Azizan Nessa Khatoon v. Abul Hussain Bhuiya and others (PLD 1958 Dacca 8).
(6) National Bank of Pakistan v. Jalib Saeed (SBLR 2007 Baluchistan 47).
(7) S.N. T. Kumaraswa mi Chettiar and others v. M.S.M. Chinnathambi Chettiar and others (AIR 1951 Madras 291).
(8) Balakrishna Salvalram Pujari Waghmare and others v. . Shree Dhyaneshwar Maharaj Sansthan and others (AIR 1959 SC 798).
(9) Khair Muhammad Khan and another v. Mt. Jannat and others (AIR 1940 Lahore 359).
8. On the other hand Mr. A. Aziz Khan, learned counsel for the plaintiff submits that the factual controversies cannot be resolved while dealing an application under Order VII, Rule 11, C.P.C. He submits that the proposed issues have been filed on behalf of the plaintiff and better course will be to allow the parties to lead evidence in support of their respective claim. He further submits that for the purpose of Order VII, Rule 11, C.P.C. The contents of the plaint are to be taken as true and correct and if averments in plaint be taken to be true the plaintiff will not be entitled to the relief claimed and the defence cannot be looked into and the plaint can only be rejected if from any statement in the plaint the same appears to be barred by some law. He further submits that the plaintiff, has valid cause of action and the cause of action is to be seen from the contents of the plaint and not from one para. He further submits that fraud has been alleged in the plaint which cannot be decided without evidence. He further submits that the declaration has been prayed for which the limitation is six years and that this is a case of continuous breach of contract and a fresh period of limitation begins to run at every moment of the time during which the breach or the wrong, as the case may be continued and referred to Section 23 of the Limitation Act. He relied upon the following reported cases:---
(1) Muhammad Altaf and others v. Abdur Rehman's Khan and others (2001 SCMR 953).
(2) Jewan and others v. Federation of Pakistan and others (1994 SCMR 826).
(3) Muhammad Akhtar etc. v. Abdul Hadi etc. (1981 SCMR 878).
(4) Tariq Mahmood Chaudhry, Kamboh v. Najam- un-Din (1999 SCMR 2396).
(5) Mahmud Ahmed Butt and another v. Lahore Development Authority and another (PLJ 1980 Lahore 495).
(6) Mst. Shabeona Perveen v. M/s. Defence Officers Housing Society Authority, Karachi (1993 CLC 2523).
(7) Ghulam Dastagir and others v. Mst. Mariam and others (1993 MLD 1005).
(8) Ali Ahmed v. Mst. Ghulam Zohra (PLD 1987 Quetta 189).
(9) Hakim Bashir Ahmed v. The Government of Sindh and others (1984 CLC 3061).
(10) Syed Khadim Ali Shah v. S.M. Zia and others (PLD 1981 Karachi 604).
(11) Muhammad Sharif and another v. Mst. Rasool Bibi and others (1981 CLC 533).
(12) Din Muhammad and Others v. Mehar Ali Khan and others (PLD 1978 Karachi 267).
(13) Mathura Das and another v. Raja Narindar Bahadur P.L and others (23 Indian Appeals 138).
(14) Mukhdeo Singh and another v. Harakh Narayuan Singh and others (AIR 19931 Patna 285).
9. The rejection of the plaint has been sought on the ground that the plaintiff has no cause of action to file the suit as the entire sale consideration under agreement recorded during the meeting dated 26.10.2002 2as paid. The second ground taken in the plaint is that cause of action accrued to the plaintiff on 26.10.2002 and 5.3.2003 and the suit was filed in November, 2006 after a period of three years and is hopelessly time-barred.
10. It is now well-settled proposition that for the purpose of rejection of plaint the contents o the plaint are taken to be true on its face value and the contents of entire plaint are to be construed to determine whether they constitute a cause of action and the defence cannot be looked into.
11. However, in view of the case reported as S.M. Shafi Ahmed Zaidi v. Malik Hassan Ali khan (2002 SCMR 338) besides averments made in the plaint other material available on record which on its on strength is legally sufficient to completely refute the claim of the plaintiff, could also be looked into for the purpose of rejection of plaint. The plaintiff claim that under an agreement the Defendant No. 1 is liable to pay certain amount. The Defendant No. 1 disputes the averments made in the plaint and produced several documents to show that payment has been made. The plaintiff without disputing the authenticity of the documents has submitted that the documents relates to some other transactions and not to the transaction subject-matter of the suit. This controversy cannot be resolved summarily without giving opportunity to the parties to lead evidence in support of their claim. The perusal of the plaint shows that it discloses a cause of action. While considering the application in hand it cannot be considered whether at the trial the plaintiff will able to prove the case or not.
12. The other point raised by the defendants is that the suit is barred by limitation. The learned counsel for the defendants submits that a suit for compensation to break a contract can be filed within one year from the date of breach and referred to Article 27 of the First Schedule of the Limitation Act, 1908. He further submits that the amount under an agreement can be recovered by filing of a suit for specific performance of contract and that suit can be filed within three years from the date of agreement. The limitation is a mixed question of law and fact and where appropriate the Court can frame this issue. In this case also the plaintiff has pleaded that cause of action was finally accrued on 25th August, 2006 when he received the reply of defendants through their Advocate. For the purpose of Order VII, Rule 11, C.P.C. The averments made in the plaint are taken to be true at its face value. Evidence is required to disprove the facts pleaded in the plaint.
13. Application dismissed.
14. 2011 C.L.R. 961 [Karachi] Prese?It: NADEEM AZ iAR SIDDIQI, J. Mst. Roeeba Khatoon and 9 others Versus M.Y. Butt and another Second Appeal No. 10 of 2006, decided on 31st March, 2009.
CONCLUSION
(1) The question when a right to sue accrues in a suit for declaration will depend upon the facts and circumstances of each case and right to property is a subsisting right and the right to bring a declaratory suit is a continuing right.
(a) Civil Procedure Code (V of 1908)- ---S. 100---Second Appeal in High Court---Scope---The High Court in second appeal can interfere on the ground of error of law or an error in the procedure---The High Court can also interfere, if the decision is contrary to law and contrary to usage bearing force of law.
15. (Para 4)
(b) Limitation Act (IX of 1908)- ---Art. 120---Suit for declaration---Right to sue---Terminus qua---Contemplated---Said article provides that the suit for which no period of limitation is provided elsewhere in the Schedule can be filed within six years when the right to sue accrues---The question when a right to sue accrues in suit for declaration will depend upon the facts and circumstances of each case and right to property is a subsisting right and right to bring a declaratory suit is a continuing right.
16. (Para 1)
17. SUIT FOR DECLARATION --- (Terminus qua) (c) Civil Procedure Code (V of 1908)--- ---S. 100---Specific Relief Act, 1877, S. 42---Limitation Act, 1908, Art. 120---Suit for declaration and inheritance mutation---Point of limitation---Terminus qua---Both the Courts below dismissed suit on point of limitation by not dealing with specific Article of Limitation Act by which suit was barred- --Held: Right of property is a subsisting right and right to bring declaratory suit is a continuing right---Courts below had committed an error in law and had failed to exercise jurisdiction vested under them properly and in accordance with law---Impugned judgments/decrees were set aside by High Court in Second Appeal---.
18. (Paras 3,4)
19. Ref. 1995 SCMR 284, PLD 2000 Lah. 385.
20. Key Terms:- Limitation.
21. [Suit for declaration and inheritance mutation was dismissed by Courts below as being barred by time without pointing out as to which Article of Limitation Act was applicable. High Court while allowing revision petition remanded case].
22. For the Appellants: Muhammad Aziz Khan, Advocate.
23. For the Respondents No. 2: Saifuddin, Advocate.
24. Date of hearing: 31st March, 2009.
25. NADEEM AZHAR SIDDIQI, J. --- By filing this IInd Appeal the appellants have challenged the Judgments and Decrees passed by the Trial Court and Appellate Court, dismissing the suit of the appellants.
26. Learned counsel for the appellants states that in this matter Article 120 of the Limitation Act is applicable which provides a period of six years from the date when the right to sue accrues. He then submits that the right to sue accrues to the appellants on the day when the Respondent No. 2 has refused the mutation of their names. He further submits that the learned Trial Court as well as learned Appellate Court without considering the material available on record and without determining the date of start of limitation have come to the erroneous conclusion and thus, failed to exercise the jurisdiction vested under it properly and in accordance with law. Learned counsel has relied upon the following reported cases:---
(1) Wali & 10 others v. Akbar & 5 others (1995 SCMR 284);
(2) Mst. Zakia Begum v. Niaz Ahmad (1999 MLD 3156);
(3) Saleem Akhtar v. Nisar Ahmad (PLD 2000 Lahore 385); and
(4) Mst. Samina Sheikh v. Vice-Chancellor, University of Punjab (PLJ 1996 Lahore 1389).
27. Learned counsel for the respondent No. 2 has conceded the above legal position and states that both the Courts below should have discussed the specific article of the Limitation Act under which the suit was barred and has endorsed his no objection for remand of the case to the Trial Court for deciding the same afresh on merits after providing the opportunity to the parties to led further evidence if they so desired.
28. From the perusal of both the Judgments it appears that both the Courts below have dismissed the suit on the point of limitation. In the Judgment dated 20.7.2004 passed by the learned Trial Court it has been observed as under:- "As it is evident from the record that Margoob Ahmed the father of plaintiffs Nos. 2 to 10 and husband of plaintiff No. 1 allegedly purchased the suit plot on 9.5.1966 and the present suit was filed on 17.12.2002 after lapse of 36 years which clearly shows that present suit is hopelessly time-barred and plaintiff side has not been able to advance any plausible explanation for such delay. Hence in my humble view that the present suit is hopelessly time-barred and not maintainable."
29. From the above quoted portion of the judgment it appears that the Trial Court has not stated which article of Limitation Act is applicable and what was the starting point of limitation.
30. The Judgment of the Trial Court was upheld by the learned Appellate Court. While dismissing the appeal the learned Appellate Court has observed as under:--- "Margoob Ahmed the father of appellants/plaintiffs Nos. 2 to 10 and husband of appellant/plaintiff No. 1 allegedly purchased the suit plot on 9.5.1966 and the suit was filed on 17.12.2002 after lapse of 36 years which clearly shows that it is hopelessly time-barred and appellants have not been able to advance any plausible explanation for such delay. Hence I am of the opinion that the learned Trial Court has rightly held that the suit is not maintainable."
31. From the above quoted Judgment of the learned Appellate Court it is apparent that the same error has been committed by the learned Appellate Court by not dealing with the specific article of the Limitation Act by which the suit was barred. The Appellate Court has also not discussed the starting point of limitation and has merely stated that the husband of plaintiff No. 1 allegedly purchased the suit plot on 9.5.1966 and the present suit was filed on 17.12.2002 after lapse of 36 years. In this matter it appears that Article 120 of First Schedule of the Limitation Act is applicable. The said article provides that the suit for which no period of limitation is provided elsewhere in the schedule can be filed within six years when the right to sue accrues. The question when a right to sue accrues in suit for declaration will depend upon the facts and circumstances of each case and right to property is a subsisting right and the right to bring a declaratory suit is a continuing right.
32. 1995 SCMR 284) the Hon'ble Supreme Court has held as under:--- "In such cases Article 120 of the Schedule to the Limitation Act applies and time runs from the date when the plaintiff feels aggrieved."
33. PLD 2000 Lahore 385) the Lahore High Court has held as under:- "Article 120 Limitation Act provided limitation for filing a suit for declaration six years only from the date of right to sue. The right to sue would accrue to the plaintiff when his right was denied by the defendant/respondent. The right of the plaintiff is a continuous right. There can be no right to sue until there is an accrual of right asserted in the suit and its infringement or its clear unequivocal threat to infringe that right by the defendant against whom the suit is instituted."
34. The High Court in Second Appeal can interfere on the ground of error of law or an error in the procedure. The High Court can also interfere, if the decision is contrary to law and contrary to usage being force of law. Apparently by not discussing the relevant provisions of the Schedule of the Limitation Act and by not determining the date from which the limitation starts running both the Courts below have committed error in law and have failed to exercises the jurisdiction vested under them properly and in accordance with law.
35. This IInd Appeal is disposed of accordingly. .