JUDGMENT IRFAN SAADAT KHAN, J. Thorough this High Court Appeal the appellant, Pakistan State Oil, has impugned The order dated 3 September, 2010 passed in Suit No.1661 of 2008 by the learned single Judge of this Court, whereby the injunction application filed by the plaintiff under Order XXXIX, Rules 1 and 2, C.P.C., was dismissed.
2. The brief facts relevant for the purpose of this appeal are that Plots bearing No.10-E and 11-E, Jahangir Road, Karachi were leased by the respondent No.1 to respondent No.2' for subletting the same to a peteroleum company. The respondent No.1 leased out the said plots to Dawood Petroleum Company for a period of 30 years, for the purpose of constructing a petrol pump thereon. Subsequently, the said Dawood Leasing Company was merged with the appellant. On expiry of the lease period the respondent No.2 through a letter, informed the appellant that fresh offers have been received by them from various parties offering rent at Rs.20,000 per month plus deposit of Rs. 2.0 million and asked the appellant to either match the offer or to vacate the premises. The appellant alleged that the respondent No.2 threatened the appellant of dispossession from the said plot without due process of. Law and, therefore, filed a suit which was dismissed due to non joinder of the proper/necessary party. Subsequently, another suit was filed by the appellant which was withdrawn on the basis of a statement by the respondents 1-3 that they will only remove the appellant from the disputed property after fulfilling the norms of law.
Thereafter the plots by way of an auction in which the appellant participated but failed, allotted the plots to one Khushnood Sadiq who handed over the same to his brother Navid Sadiq for running a petrol pump at the said plots. The appellant thereafter started selling its products from the petrol pump through its dealer Naveed Sadiq, who subsequently expired. In the meantime the legal heirs of Naveed Sadiq filed a SMA in respect of the assets left behind by the deceased, which was granted and through a family settlement the petrol pump was given to the respondent No.4, who was the widow of the deceased Naveed Sadiq. The respondent No.4 applied for execution of dealership license to the appellant which was granted to her. On 29-10-2008, the appellant wrote a letter to the respondent No.4 calling upon her to deposit a sum of Rs.1 million as Dealership Security Deposit. The respondent No.4 expressed her inability to deposit the said amount and requested the appellant to waive the condition of deposit of the said amount which was refused by the appellant.
Thereafter, the respondent No.4 contacted respondent No.5 to become their dealer for which the respondent No.5 wrote a letter to the appellant to give a NOC but the appellant declined the same, as the appellant wanted to retain the site and since a dealership agreement was executed between the appellant and the respondent No.4, therefore, the respondent No.4 was bound to pay Rs.1 million as security deposit and if she fails to do so she will have no right to continue as dealer of the appellant and has to vacate the disputed premises. Since as per the appellant the respondent No.4 was avoiding to honour her commitment, the appellant filed a Suit bearing No. 1661 of 2008 wherein an injunction application under Order XXXIX, Rules 1 and 2, C.P.C. Was also filed with prayer "to restrain defendant No.4 (respondent No. 4 herein)...... From entering into dealership agreement with defendant No.5 (respondent No.5 herein) and defendant No.5 may also be restrained from entering into dealership agreement with the defendant No.4 in respect of the petrol pump site..."
This application was dismissed vide the impugned order, against which the present appeal has been filed.
3. The main contention of Mr. M. Sadiq Hidayatullah, learned counsel for the appellant was that the appellant was the sub-lessee of the respondent No. 1 for a period of 30 years and after expiry of the said period of lease the appellant became statutory tenant of the respondent No.1 under section 116 of the Transfer of Property Act. Therefore, the appellant cannot be evicted otherwise than due process of law in this regard: he-relied on the case reported as Mrs. Zarina Khawaja v. Aga Mehboob Shah (PLD 1998 SC 190). He contended that even if the disputed property be considered to be of the Government even then the Government has to give notice, as required under Recovery of Possession Ordinance, 1965 for vacating the premises. Reliance in this regard was placed on an unreported judgment in Suit No.1749 of 2000. As per the learned counsel this judgment was thereafter upheld in High Court Appeal No.34 of 2001. The learned counsel also relied on the judgment in the case of Khaliq Raza Khan v. PSO (1998 SCM R 2092) and submitted that after execution of lease of the disputed plots by the Federal Government in favour of the appellant they cannot be ejected.
4. On the other hand, Mr. Muhammad Saleem Thepdawa, learned counsel for respondent No. 4, stated that the said plots were leased in favour of the appellant for a period of 30 years and thereafter the lease was extended for a period of two terms of 10 years each and finally the lease expired in 2001. After expiry of the lease the said plots were auctioned for fresh lease in which the appellant also took part. The bid of one Khushnood Sadiq brother-in-law of respondent No.4, being much higher than the other bidders, was accepted and the said plots were leased out to him and, thus, the leasehold rights or right of tenancy of the appellant, in respect of the suit plots came to an end. He also submitted that as per the terms and conditions of the auction for fresh lease of the said plots it was a precondition that the appellant should first surrender peaceful vacant possession of the said plots to respondent No.1, whereafter the appellant would be entitled to participate in the auction. Since the appellant did take part in the auction, therefore, presumably they must have complied with the said condition. He also submitted that the appellant stopped paying the monthly rent after the expiry of the lease period and on execution of fresh lease in favour of Mr. Khushnood Sadiq, the rent was paid by him to the respondents Nos.1 to 3.' He also stated that after, the death of Mr. Naveed Sadiq, through a family settlement, the said plots were given to respondent No.4 and respondent No.1 also executed fresh lease in her favour. During all this period, the respondent No.4 and prior to her, her deceased brother-in-law. Khushnood Sadig, continued to act as dealer of appellant. The dispute only arose when the appellant demanded Rs. 1 million from respondent No.4, who was unable to deposit the said amount with the appellant and started searching for a new dealership from another petroleum company that the appellant started these litigations. According to the learned counsel, the entire contentions of the appellant are without substance and hence are liable to be rejected with cost. In support of his contentions the learned counsel relied on MCB v. Adamjee Insurance Company Ltd. (2003 ivILD 688), Muhammad Yagoob v. Health Officer Municipal Committee, Hyderabad (1973 SCM R 184), Ch. Muhammad Akram Bhatti v. Government of Pakistan (1993 M LD 627), Hag Brothers v. The Commander. Karachi (1990 CLC 489) and section 3 of the Central Government Land and Building (Recovery of Possession) Ordinance, 1965.
5. Mr. Muhammad Ashraf Khan Mughal, learned D.A.-G. Adopted the arguments advanced by Mr. Thepdawala. Learned counsel for respondent No. 5 also adopted. The arguments of Mr. Saleem Thepdawala.
6. We have heard all the learned counsel at length and have perused the record and the decisions relied upon.By them.
7. It is seen from the record that by virtue of a lease deed dated 2-8-1971 made between the President of Pakistan and Pak PWD, 'Sports Club, Karachi the plots mentioned above were given to respondents Nos. 2 and 3 for a period-of 30 years commencing on 2-8-1971. The respondents No. 2 and 3 thereafter entered into lease agreement dated 25-8-1971 for a period of 10 years commencing on 25-8-1971 with Messrs Dawood Petroleum Limited on a monthly rent of Rs.2,700.
This agreement was thereafter twice renewed for 10 years each till 2001 and thereafter the same was not renewed as the main lease deed entered between the respondents Nos. 2 and 3 and the President of Pakistan also stood expired. After the expiry of the lease the said plots were auctioned for a fresh lease in which the appellant also participated but the bid of one Mr. Khushnood Sadiq, who was the brother-in-law of the present respondent No. 4 was much higher and was accepted.
The said plots were' then leased out to Mr. Khushnood Sadiq and thereafter tenancy right of the appellant in respect of the said plots came to an end. The whole emphasis of the learned counsel for the appellant was on the point that after the expiry of the lease period certain statutory rights have accrued to them hence in view of these rights the appellant could not be ejected.
8. It is an admitted position that the suit plots were first leased out to Dawood Petroleum Company which subsequently was merged with the appellant. Thereafter, the period of lease was extended and finally the lease in favour of the appellant expired in the year, 2001 and the plots were put to fresh auction. One of the pre-conditions for taking part in the bidding was that the appellant should first surrender peaceful vacant possession of the said plots to respondent No. 1. It is not understandable as to how the appellant is claiming the statutory rights of a tenant after surrendering peaceful vacant physical possession of the plots to the respondent No. 1. It is also seen from the record that the appellant participated in the auction but the bid of the appellant was not accepted and was not granted the fresh lease in respect thereof. It appears that the appellant is blowing hot and cold in the same breath as at one point of time the appellant had claimed that by virtue of above provision of law some statutory tenancy rights have accrued to him and on the other hand had, participated in the auction proceedings clearly manifesting that. The appellant wanted to become a new tenant of the said plots but failed in this regard.
9. It may also be noteworthy that from the contents of the lease deed entered between the appellant and the respondents it is evident the appellant was under legal obligation to deliver the said plots to respondent No.1 after the expiration of the said lease deed. It is also apparent from the various clauses of the said lease that the appellant was under the legal obligation to not only deliver the said plots to the respondent but also to remove all the belongings including the tanks and other apparatus from the said plots and would restore the plots to its former condition. It is also noted that some litigation took place between the appellant and the respondents Nos. 2 and 3 for vacating the premises and handing over the vacant possession, which was thereafter settled when the appellant showed his willingness to participate in the auction proceedings of the said plots and thereafter participated in the said bid. This clearly proves that at no point of time the appellant claimed any tenancy right over the said plots but handed over the vacant peaceful possession of the said plots with the view to participate in the bid proceedings thereafter.
10. It is also seen that immediately after the expiry of the lease deed the appellant stopped making payment of the monthly rent proving that they were mindful of the fact that they were no more tenant of the said plots and were not required to pay any rent to the respondents Nos. 2 and 3 in his behalf. It was Mr. Khushnood Sadiq, who upon entering into the lease agreement, started paying monthly rent to the respondents Nos. 2 and 3, which fact also had not been denied by the learned counsel appearing for the appellant.
11. As stated above, the suit plots were given to respondent No.4 pursuant to a family settlement after the death of her husband, and she continued acting as dealer of the appellant. However, the trouble started brewing when appellant asked respondent No.4 to deposit Rs. 1 million as security deposit. Respondent No. 4 requested the appellant to waive the condition of security deposit of Rs.1 million but the appellant- refused the same vide its letter dated 13-10-2008 and as a result thereof the dealership agreement entered into between the appellant and the respondent No.4 came to an end. The respondent No. 4 thereafter entered into a lease deed with respondent No.5. Thus, it would be seen that there was no privity of contract between the appellant and the respondent No.4. And if the appellant is of the opinion that there was a valid and existing agreement between the parties, then the appellant should have filed a suit for specific performances of such agreement. However, in the absence of a valid and enforceable contract between these two parties, no injunction can be granted in favour of the appellant and against the respondent No.4.
12. The relief sought by the applicant in the suit in our opinion, was rightly refused by the learned Single Judge as We do not find ourselves in agreement with the submissions made by the appellant that after the expiry of the lease they have become the statutory tenants, which is belied from their on conduct that after the expiry of the said lease they participated -in the bid for the fresh lease. The applicants were mindful of the fact that after the expiry of the said lease term they will not remain tenant of the said plots unless they obtain fresh lease in this regard.
13. The appellant's another contention that in view of the developments in the case the respondent No. 4 after becoming their dealer has to pay a sum of Rs. 1 Million as security deposit and be restrained from creating a fresh dealership agreement with the respondent No. 5 is also found to be bereft of any- merit as according to the pleadings of the appellant, it is evident that they called upon the respondent No. 4 to deposit a sum of Rs. 1 million as dealership security for which the respondent No. 4 applied for waiver of the said amount as a-special case as she was not in a position to pay the amount and the said request was not entertained on the ground of company's policy. It is also noted that it was only after the refusal of the appellant to renew the dealership agreement with the respondent No.4 that the said respondent entered into a new agreement with the respondent No.5. The learned counsel for the appellant could not satisfy us that how a restraining order could be issued from preventing the respondent No.4 to enter into an agreement with respondent No.5. Neither any evidence, material nor any convincing argument is put up in this regard by the appellant to justify passing of such order. It is observed that the appellant had totally failed to demonstrate as to what prejudice has been caused to them in this regard, when admittedly they failed to obtain fresh lease in their favour. It is also seen that when the appellant refused to. Enter into a dealership agreement with the respondent No.4 on the ground that security deposited had not been paid for all practical purposes the said agreement entered between them had come to an end. No contract in fact existed between the parties thereafter hence the appellant cannot claim any right after the expiry of the dealership between the respondent No.4 and the said dealership agreement could not be enforced by law in this regard..
14. The decisions relied upon by the learned counsel for the appellant have already 'been discussed at length by the learned Single Judge; hence the same are not discussed here. As it has already been found to be distinguishable by the learned Single Judge so far as the decisions relied upon by the learned counsel for the respondent No. 4 is concerned, it is seen that two decisions one that of MCB and another that of Muhammad Yaqoob has already been discussed by the learned Single Judge. In the case of Ch. Muhammad Akram Bhatti decided by Division Bench of this Court it was held that if the petitioner was an unauthorized occupant of the premises belonging to the Federal Government after the expiry of the period of lease the Federal Government is empowered to evict the said tenant under section 3 of Central Government Lands and Buildings (Recovery of Possession Ordinance, 1965). It was held in the decision given in the case of Haq Brothers that one of the terms and conditions of said agreement was that in case it was not renewed upto 31-12-1986, the licensee would pay all dues, vacate the premises and remove at his cost all the material, lying there within a month of the termination failing which the same will be forfeited. Since the premises in question are owned by the Federal Government they are subject to the Ordinance which was promulgated to provide for the speedy recovery of possession of Central Government lands and buildings from outgoing lessees and licensees and unauthorized occupants. The provisions of the Ordinance are to prevail notwithstanding any provision to the contrary in any other law,. By virtue of the provisions contained in section 3 of the Ordinance.
17. (sic) In view of the above facts we have come to the conclusion that the appellant has come to the Court with unclean hands and no restraining order in this regard could be passed thereof. The appellant does not appear to have any right against the respondent No.4. When the dealership agreement entered between the parties had become non-operative due to non-fulfilment of the clause regarding the payment of security deposit, there was no privity of contract between the parties. It is observed that appellant is trying to enforce something which is not available to them as at one hand they were embarking upon the respondent No.4 to become a dealer and on the other hand seeking restraining order from this Court, in view of non-fulfilment of a clause, that the respondent No.4 had now ceased to be their dealer.
18. At this stage we may also dispose of the objection made by the learned counsel on the basis of the order sheet whereby he had tried to argue that on the particular day of hearing the hearing of the application under Order XXXIX, Rules 1 and 2, C.P.C. Was adjourned, therefore, the order was passed without hearing him - on the merits of the application. We have perused the impugned order and have seen that elaborate arguments of the learned counsel on the said application have been recorded and, therefore, it is apparent that the application under Order XXXIX, Rules 1 and 2, C.P.C. Has been heard as such arguments cannot be a figment of imagination of the learned Single Judge.- Therefore, the only conclusion which can be drawn is that the order sheet has been mistakenly recorded; therefore, this contention of the learned counsel for the appellant is repelled.
19. We in this regard find ourselves to be in agreement with the order passed by the learned Single Judge that no prima facie case for granting injunction in favour of the appellant arises in the situation as the appellant had failed to prove the likelihood of any irreparable loss or injury to him The appellant had also failed to justify grant of injunction in their favour for restraining the respondent No. 4 from entering into an agreement with respondent No. 5 to show that by entering into an agreement the appellant would be seriously prejudiced. We therefore in view of the above observations have come to the conclusion that no prima facie case for interference has been made out by the appellant, this High Court Appeal thus being bereft of any merit is hereby dismissed..