On 18-3-1969 the respondents filed a suit for the specific performance of the agreement for sale dated 3-10-1968. By virtue of this agreement Babu Roshan Din the predecessor-in-interest of the appellants had agreed to sell the land measuring 225' % 340' to the respondents situate in Bungalow No. 13, Bazar Road, Sialkot for a total consideration of Rs. 14,000 out of which a sum of Rs.
2,000 is alleged to have been received in advance. The time for completion of the sale was fixed as 30-1-1969. Babu Roshan Din had acquired the old grantees right in the said property which was declared evacuee under P. T. D. Dated 26-5-1967. Babu Roshan Din died on 15-1-1969 and the suit was filed against his heirs. The suit filed by the respondents was contested by the appellants and it was contended that the suit was' bad for non joinder of parties. It was contended that the Central Government was a necessary party as the land in question was situate within the Cantonment area and was owned by the Central Government. The objection of the non-joinder was also based on the omission of the respondents to implead Mahmoodul Hassan a pre-deceased sister's son of Babu Roshan Din. As regards the execution of the agree--ment for sale it was denied for want of knowledge and same was the assertion as regards the payment of Rs. 2,000 to Babu Roshan Din as earnest money. It was further submitted by the appellants that a prior sanction of the Central Government or of the Cantonment Board was necessary which was never obtained by Babu Roshan Din and as such the agreement, if any, could not be enforced. It was further stated that the consideration of the alleged contract was grossly inadequate and that the respondents had obtained this agreement by fraud and by taking undue advantage on account of the old age and weak mental state of Babu Roshan Din who was said to be suffering from different diseases. On the pleadings of the parties the following issues were framed :-
(1) Whether the suit is bad for non-joinder of the parties? O. D.
(2) Whether Roshan Din deceased executed any agreement with the plaintiff? O. P.
(3) If Issue No. 2 is proved, whether the agreement in question is illegal? O. D.
(3-A) Whether Roshan Din deceased at the time of the execution of the agreement in dispute did not shoulder a disposing mind, and by fraud was led to set his hands to the agreement in dispute?
O. P. D.
(4) Whether the plaintiffs are entitled to the specific performance of the agreement in question? O.
P.
(5) Relief:
2. The Senior Civil Judge, Sialkot, after recording the evidence of both the parties decided all the issues in favour of the respondents and decreed the suit vide his judgment, dated 15-10-1974. The findings on all these issues were challenged in appeal before the Additional District Judge, Sialkot, but the same was dismissed on 13-10-1979 and hence this second appeal.
3. The learned counsel for the appellants has raised the following contentions :-
(1) The proceedings before the trial Court are vitiated in the absence of necessary parties already indicated above.
(2) Since the agreement dated 3-10-1968 related to the possession of ground attached to the bungalow in question being an old evacuee grant permission of the Central Government or at least of the Cantonment Board was necessary.
(3) Babu Roshan Din having been transferred only the old grant rights of evacuee could not convey a clear title on the respondents and as such the agreement was not capable of enforcement.
(4) The agreement dated 3-10-1968 was not procured by free consent on account of the old age and the mental condition of Babu Roshan Din deceased.
4. Babu Roshan Din died sonless and Mahmoodul Hassan is said to be the sister's son of Babu Roshan Din deceased. The contention of the appellants was that he was also entitled to inherit the estate of the deceased. Both the Courts below on the basis of the evidence on record came to the conclusion that Mahmoodul Hassan's mother died during the lifetime of Babu Roshan Din and as such the daughter would get the residuary by the doctrine of return. No exception can be taken to this finding. The question whether the Central Government was a necessary party is not related with the objection relating to misjoinder of the parties rather concerns the merits of the case and enforceability of the agree--ment. The issue whether Babu Roshan Din deceased had executed any agreement with the respondents had not been pressed before the lower appellate Court. As regards the validity of the agreement much emphasis had been laid on the statement of Muhammad Latif plaintiff examined as his own witness as P. W.
5. Muhammad Latif plaintiff had admitted that the land within the Cantonment limits belonged to the Government and that he had not obtained any sanction from the Government to purchase the land. However, the witness clarified that he was to apply for the permission after the purchase of the property. P. W. 6 Muhammad Anwar Zafar is Deputy Assistant Military Estate Officer, Sialkot. He explained that old grant connoted free grant without payment of rent. It was admitted by the witness that the Government had allowed the sub-divisions of different bungalows in Sialkot as well as in other Canton--ments. The statement of P. W. 5 Muhammad Latif plaintiff was supported by the witness that after the sale is effected the Cantonment authorities automatically on the application of the purchaser transferred the property in his name and that it also equally applied to sub-divided plots. The relevant portion of his statement may be reproduced below:- "As 1 have mentioned above there is no impediment in its transfer by the lessee to any Pakistani National. Under the present liberal policy the Government will allow the transfer without any hesitation and the sub division thereof. Bungalows Nos. 26, 93, 21 and some other bungalows too have already been sub-divided and necessary permission had already been accorded."
5. The learned counsel for the appellants further submitted that there had been correspondence between their counsel and the Sialkot Cantonment and reference was made to Exhs. D. 1, D. 2, D. W.
4/1, D. W. 4/2, and Exh. D. W. 4/5. By , reference to Exh. D. W. 4/2 which is an extract from the General Land Register, the appellants wanted to show that the nature of right holds vesting in the evacuee Jalbhoy son of Rustamji was an old grant and that this bungalow had a total area of 3.49 acres, Exh. D. 1 which is a letter from the Cantonment Executive Officer addressed to Mr. Ikramul Haq, Advocate of Sialkot Cantt. States that the land of the bungalow being an old grant, its proprietary rights were with the Central Government and the owner of the bungalow being the licensee could not sell the land. It was further stated in the same letter that the full particulars, address of the owner, sale deed etc. Executed or under execu--petition be intimated to the office for further action. A reading of this letter does not convey a prohibition of the sale. It supports the statement of P. W. 6 Muhammad Anwar Zafar that after the purchase the application has to be made by the purchaser and this would be evident from the following extract of Exh. D. 1: "Please intimate this office full particulars, address of the owner, sale deed etc. Executed or under execution to enable this office to take further action in the matter."
Under Exh. D. 2; Mr. Ikramul Haq, Advocate had been informed that in the record of the Cantonment the old grant rights were in the name of Babu Roshan Din and had not yet been transferred in the name of his heirs and the particulars of the legal heirs were required to be furnished under this letter. Exh. D. W. 4/1 is addressed to Dr. Manzoor Ahmad, Saddar Bazar, Sialkot Cantt., which indicates that his bid for lease hold rights had been accepted for Rs. 6,000 and he was required to comply with certain formalities stated in this .Letter. Exh. D. W. 4/5 contains certain queries in order to mutate the old grant standing in the name of Babu Roshan Din and in the names of his heirs.
From the examination of the documents and evidence on record it is absolutely clear that the permission can be obtained by the transferee even after the sale and the contention of the appellants that since the land vests in the Central Government the sanction of the Cantonment Board was necessary cannot be entertained. The lower Appellate Court had relied on Munshi Tajammul Hussain v. Cantonment Board, Lucknow etc., AIR 1943 Oudh 99, for the proposition that a contract for the sale of land within the Canton--ment was not opposed to any law or public policy within the meaning of section 23 of the Contract Act. In this case the house belonging to the plaintiff had been demolished by the Cantonment Board and was also prosecuted for making unauthorised construction. The plaintiff was acquitted and as such he filed two suits against the Cantonment Board; one for wrongful prosecution and the other for damages in respect of demolition of a portion of his house. The suits were compromised and a decree was passed on the basis of compromise. The plaintiff had filed a separate suit for a declaration that this compromise was not binding on him. It was in this connection that a question arose whether it was the duty of the Cantonment Board to obtain the sanction of the Government of India and to the grant of the rights in question that so there might be no possible doubt as to the plaintiff's title. This contention was repelled and in this connection it was observed as under :- "Tests have been laid down in various cases and it has been held inter alia that where a statute prescribes no penalties an agreement in breach of a condition imposed under powers given by it does not fall under section 23, and that where a condition is imposed under statutes purely for administrative purposes an agreement in violation . Thereof is not void. We are clearly of opinion that the consideration of the agreement in the present case was not unlawful within the meaning of section 23, Contract Act."
This judgment was relevant and was rightly relied upon by the lower Appellate Court. The learned Appellate Court bad also relied on letter No. 18/10/L/D5/C/67/1283L dated 26-8-1967 by which the Military Lands Cantonments General Headquarters, Rawalpindi had clarified that a lessee could transfer the whole or any part of the premises leased out to him and that the Government would give effect to such a transaction.
6. The learned counsel for the respondents argued that the lands in Cantonments were regulated by the Cantonments Act of 1924 and the Cantonment Lands Administration Rules, 1937. It was submitted that none of the provisions in the Cantonments Act or the Cantonment Lands Administration Rules referred to above restricted the transfer of the rights acquired either under the old grant or under the lease. Section 73 of the Cantonments Act, 1924 provides that whenever the title of any person primarily liable for the payment of a tax on the annual value of any building or land to or over such building or land is transferred, the person whose title is transferred and the person to whom the same is transferred shall, within three months after the execution of the instrument of transfer or after its registration, if it is registered, or after the transfer is effected, if no instrument is executed, give notice of such transfer to the Execu--tive Officer.In respect of the old grants it is provided under rule 27 of the Cantonment Lands Administration Rules, 1937 that the holder thereof has a right to make an application for a regular lease to the Military Estate Officer, who without any reference to any superior authority, grant a lease in the form set out in Schedule 7.
Reference may also be made to a judgment reported as Nazaralii Sayad Imam v. Babamiya Dureyatimsha (19161 L R 64). In this case the question that had arisen for considera--petition was whether an agreement to enter into partnership which contravened the terms of the licence was unlawful within the meaning of section . 23 of the Contract Act. Here also for entering such a partnership prior sanc--petition of the Forest authorities was necessary. The relevant observations may be reproduced below :- "To turn row to the agreement as given above, I have to see whether the consideration or object of it was unlawful. From what I have given above it will be seen that the parties never intended that the partnership shall come into existence without any permission of the Divisional Forest Officer.
Plaintiff has expressly stated in the plaint that the agreement was reduced to writing and every step, to legalize it, was to be taken in time to come. It can not, therefore, be said that the object or consideration of the agreement was unlawful so as to render it void under section 23, Indian Contract Act. The rules also do not absolutely forbid any such partnership as was contemplated by the parties. They only state that no such partnership shall be recognised by the forest authorities, unless their permission in writing for the same is secured and a fine is prescribed to the ostensible contractor if any such partnership is formed and the sub-contractor allowed to work independently. The test to be applied to such agreements to determine whether they are void under section 23, is laid down on page 117, Second Edition, of Pollock and Mullas' Indian Contract Act. That which has been forbidden in public interest cannot be made lawful by paying the penalty for it, but an act which is in itself harmless does not become unlawful merely because some collateral requirements, imposed for reasons of mere administrative convenience has been ornitted. Applying this test to the agreement in hand I find that the same cannot be unlawful between the parties to it though the forest authorities do not recognize it unless their permission is secured."
Reliance may also be placed on a judgment of the Supreme Court reported as Manzoor Hussain etc. v. Wali Muhammad etc. (PLD 1965SC425). In this case it was observed that the Foreign Exchange Regulation Act did not forbid the making of a contract which may contemplate doing a thing which is contrary to the provisions of the Foreign. Exchange Regulation Act, for, that thing can' still be done by ex post facto permission of the State Bank of Pakistan. The schedule of the Foreign Exchange Regulation Act, therefore, is not to forbid the making of a contract but merely to insist that the contract shall be performed in a particular manner, namely, by taking the necessary permission of the competent authority. It was further observed that in the circumstances it could not be said that a contract which violated any of the terms of the Foreign Exchange Regulation Act is ex facie or ab initio void or comes within mischief of a contract prohibited by section 23 of the Contract Act. Their Lordships of the Supreme Court further held that the provisions of section 23 of the Contract Act are to be construed strictly and the Courts "should not invent new categories or new heads of public policy in order to invalidate a contract".
7. The next contention of the learned counsel for the appellants was that in the present case as Babu Roshan Din could not give a clear title the contract could hot be enforced under clause (b) of section 25 of the. Specific Relief Act, 1877. Clause (b) of section 25 reads as under: Section 25.-A contract for the sale or letting of property, whether movable or immovable, cannot be specifically enforced in favour of a vendor or lessor-
(a) .
(b) who, though he entered into the contract believing that he had a good title to the property, cannot, at the time fixed by the parties or by the Court for the completion of the sale or letting, give the purchaser or lessee a title free from reasonable doubt;
(c) .
Section 25(b) of the Specific Relief Act becomes operative only when circumstances are disclosed which cast some doubt on the title of the seller. In present case old grant rights in respect of the property in question had been undoubtedly granted to Babu Roshan Din vile P. T. t). Dated 26-5- 1967. Old grant rights are substantial rights in the property duly recognized by the Cantonment Board. This could rippen into the Cantonment Board on the application of the holder under rule 27 of the Cantonment Lands Administration Rules, 1937. This bungalow has an area of 3.49 acres as per Exh. D. W. 4/2 and Babu Roshan Din had only agreed to sell an area measuring 225' x 340' out of the said area vide agreement dated 3-10-1968 for a consideration of Rs. 14,030 which according to the observa--tions of the learned Additional District Judge, Sialkot was quite adequate at the relevant time.
8. As regards the contention of the app; llants that the agreement was vitiated on account of the old age and the mental infirmity of Babu Roshan Din deceased, both the Courts below have held that Babu Roshan Din had only once an attack of paralysis and that he continued his profession of photography and as such it could not be said that he lacked the mental fitness. Section 16 of the Contract Act provides that a contract is said to be induced by "undue influence" where the relations subsisting between the parties are such that one of the parties is in a position to dominate the will of the other and uses that position to obtain an unfair advantage over the other.
Subsection (2) provides that in particular and without prejudice to the generality of the foregoing principle, a person is deemed to be in a position to dominate the will of another where he makes a contract with a person whose mental capacity is temporarily or permanently affected by reason of age, illness, or mental or bodily distress.
9. 1 have gone through the entire evidence on record, none of the ingredients of section 16 has been brought on record. The respondents had produced Khawaja Muhammad Ashraf P. W. 1 to prove the agreement dated 3-10-1968. The witness was not cross-examined by the appellants to suggest any of the ailment, old age or men' .Al infirmity. Similarly P. W. 2 Mistry Muhammad Ashraf had also not been cross-examined on the lines as suggested by the learned counsel. Only Mahmoodul Hassan D. W. 1 had stated that Babu Roshan Din deceas4d had once suffered an attack of paralysis and the second attack had made him mum. In the cross-examination he admitted that right up to his death Babu Roshan Din bad been carrying on his business.
10. In view of the above discussion, no ground has been made out for interference in the concurrent finding of fact of the two Courts below. This appeal has no force which is hereby dismissed with no order as to costs.