' MAMOON RASHID SHEIKH, J.--- This appeal under section 96 of the Code of Civil Procedure, 1908, has been filed against the judgment and decree dated 20-2-2006 passed by the learned Senior Civil Judge, Rawalpindi, whereby the appellant's suit for specific performance of contract has been dismissed.
2. The facts relevant for the present purposes are to the effect that on 13-7-1995, at Rawalpindi, the appellant entered into an agreement to sell ("the Agreement") with the father of the respondents in respect of the lease hold rights (Old Grant) of Plot No,288, measuring 1.36 acres, together with the superstructure thereon, bearing Khasra No,435 situated at Peshawar Road, Rawalpindi Cantt.
(hereinafter referred to as "the Property"), for a total consideration of Rs,1,25,00,000/-. At the time of execution of the Agreement the appellant paid Rs,25,00,000/- (through a cheque) as advance money to the father of the respondents. Pursuant to Clause-2 of the Agreement, through a Registered General Power of Attorney ("the GPA"), of even date, the father of the respondents appointed the appellant as his General Attorney in respect of the Property empowering him to sell the Property with the stipulation, however, that the GPA would become operative once the balance consideration was paid and till such time the GPA would remain in the custody of the father of the respondents. Clause-3 of the Agreement stipulated that the balance consideration in the sum of Rs,100,00,000/- was to be paid by the appellant on or before 31-12-1995 and upon payment of the balance consideration the sale-deed was to be executed and/or the GPA was to become operative in connection with the transfer of the Property. The appellant subsequently deposited a sum of Rs,10,00,000/- in the bank account of the father of the respondents before the cut-off date i,e, 31-12-1995, however, the remaining balance consideration was not paid by the said date. In the month of January, 1996, the appellant through his father contacted the father of the respondents for execution of the sale-deed. The appellant's father was informed that the respondents' father who was resident at Lahore would visit the appellant around the 15th or 20th of January, 1996, for completion of the contract. However, the respondents' father failed to turn up on the said dates.
The appellant, therefore, contacted the respondents' father telephonically on 3-2-1996 but was informed by the mother of the respondents that the respondents' father was in Islamabad. The appellant, therefore, contacted the respondents' father at his cousin's residence at Islamabad and requested that the Sale-deed be executed at the earliest. On 6-2-1996 the respondents' father visited the appellant at his residence and promised that on 7-2-1996 he would return with all the original documents and NOCs etc. For purposes of completion of the deal. However, the respondents' father failed to turn up. As a consequence, on 8-2-1996 the appellant sent a legal notice to the respondents' father through registered post acknowledgement due. The respondents' father on 14-2-1996 revoked the GPA through a registered Deed of Revocation. On 12-3-1996 the appellant filed a suit for specific performance of the Agreement in the Civil Courts at Rawalpindi, against the father of the respondents. Soon after filing of the suit i,e, in the month of July, 1996, the respondents father died where after the respondents were brought on the record as his legal heirs.
The respondents resisted the suit and on 23-6-1998 on the basis of the divergent pleadings of the parties eight (8) Issues were framed. Subsequently, the paternal grandmother of the respondents was also made a defendant in the suit in her capacity as one of the L.Rs of the respondents' father.
' The grandmother of the respondents was initially arrayed as respondent No,4 in the instant appeal but upon her demise during pendency of the appeal the present respondents being her legal heirs were brought on the record as the legal heirs of their father as well as their paternal grandmother.
' Upon being impleaded as a defendant in the suit the grandmother of the respondents filed her separate written statement. As a consequence, Additional Issues (7-A and 7-B) were framed by the learned trial Court on 5-7-2000. The Issues in the suit, the Original as well as the Additional ones, are to the following effect:
1. Whether the suit is not maintainable in its present form? OPD
2. Whether the suit is bad for non-joinder of Mst. Sarwat Rana as prayed? OPD
3. Whether the plaintiff has no cause of action to file the present suit? OPD
4. Whether the time was the essence of the contract? OPD
5. Whether the plaintiff failed to make the payment within the stipulated time? OPD
6. Whether the plaintiff is entitled to specific performance of agreement dated 13-7-1995? OPP
7. Whether the plaintiff deposited a sum of Rs,10,00,000/- in the bank account of the predecessor- in-interest of the defendants without knowledge and consent of the deceased? If so, with what effect? OPD 7-A Whether the suit is liable to be dismissed in view of preliminary objection No,1 of the written statement filed by the defendant No,4? OPD.4 7-B. Whether the plaintiff is entitled to the discretionary relief of specific performance? OPD.4 ' Relief.
' The parties led their respective evidence oral as well as documentary and on the basis of the evidence so led the learned trial Court decided Issues Nos.l, 2 and 7 against the respondents whereas Issues Nos.3, 4, 5, 6, 7-A and 7-B were decided against the appellant, inter alia, on the grounds that time was of the essence of the contract inasmuch as the balance consideration had to be paid on or before 31-12-1995 and the appellant having failed to pay it was not entitled to the specific performance of the Agreement.
3. The learned counsel for the appellant has assailed the impugned judgment and decree, inter alia, on the grounds that the learned trial Court has misappreciated the facts and misapplied the law. The learned trial Court has erred in holding that time was of the essence of the contract. It is settled law that in contracts involving immovable property time is not of the essence of the contract. Relies on the judgments reported as Abdul Hamid v. Abbas Bhai-Abdul Hussain Sodawaterwala (PLD 1962 SC 1) and Ghulam Nabi and others v. Seth Muhammad Yaqub and others (PLD 1983 SC 344). Contends that the question whether time is of the essence of the contract or not is to be determined by the attending circumstances of each case. In the instant case albeit 31-12- 1995 has been stipulated. As the date for payment of the balance consideration and execution of the Sale-deed and/or for the GPA to become operative yet no penal consequences have been stipulated in the Agreement in case of non-payment of the balance consideration by the appellant by or before 31-12-1995. Refers to Clauses (2) and (3) of the Agreement. Further submits that the bona fides of the appellant are established by the fact that he filed a suit for specific performance within two months of the stipulated date and also deposited the balance consideration with the learned trial Court. Contends that in case a time frame has been given for the performance of a contract then for time to be of the essence of the contract the consequences for non-performance are also to be enumerated or stipulated in the contract itself. However, in the Agreement no such consequences have been stipulated. In fact the Agreement is silent as to the consequences which the appellant would have to face in case of non-performance of the Agreement by the stipulated date. Reiterates that time is not of the essence of the Agreement. Relies on the judgment reported as Mst. Gulshan Hamid v. Kh. Abdul Rehman and others (2010 SCMR 334).
4. Further submits that the learned trial Court has further erred in holding that the GPA was in favour of the appellant and he could have used it for execution of the sale-deed in case the father of the respondents failed to execute the sale-deed. The learned trial Court failed to appreciate that the GPA was admittedly in the possession of the father of the respondents and had never been handed over to the appellant. Further submits that the appellant was at all times ready and willing to perform his part of the contract. Indeed, on 23-5-1996 the appellant deposited the balance consideration in the sum of Rs,90,00,000/- in the form of WAPDA Bonds with the learned trial Court which bonds were later replaced with a bank guarantee.
5. Further contends that even if the GPA had been in the possession of the appellant he could not have executed a sale-deed in his own favour by virtue of the GPA without the express permission of the father of the respondents. Relies on the judgment reported as Muhammad Taj v. Arshad Mehmood and 3 others (2009 SCMR 114).
6. Also contends that the Deed of Revocation (Exh.D-3) does not mention the reason why the GPA had been revoked. This goes to strengthen the appellant's case.
7. The learned counsel for the respondents submits that whilst there is no cavil with the proposition of law that time is not of the essence in a contract relating to immovable property. This principle of law is well-enshrined in our jurisprudence as is evident from the judgments cited at the bar by the learned counsel for the appellant i,e, Abdul Hamid v. Abbas Bhai-Abdul Hussain Sodawaterwala (PLD 1962 'SC 1) and Ghulam Nabi and others v. Seth Muhammad Yaqub and others. (PLD 1983 SC 344). However, in order to determine whether time is of the essence of the contract or not the facts and circumstances of each case have to be seen in their proper perspective. The appellant was required to conclude the contract on or before 31-12-1995. The appellant did not deposit Rs,1,00,00,000/- by the said date. Had the appellant deposited Rs,1,00,00,000/- the sale-deed would have been executed and/or the GPA would have become operative. The appellant had been acting all along through his father for negotiation of the contract and also allegedly the appellant's father contracted the respondents' father for completion of the deal in the month of January, 1996.
The appellant, however, failed to produce his father as a witness in order to establish this fact. A negative inference has, therefore, rightly been drawn by the learned trial Court in terms of Article 129 of the Qanun-e-Shahadat Order, 1984. The best evidence was withheld by the appellant, therefore. The negative inference, flows therefrom. Relies on the judgment reported as Attaullah alias Qasim v. The State (PLD 2006 Karachi 206) to contend that since the appellant's father did not appear in person to give evidence, therefore, any event attributed to the appellant's father and/or any evidence led in respect thereof is nothing more than hearsay. Further submits that as the respondents' father died soon after filing of the suit, therefore, the respondents' attorney appeared on behalf of the respondents' father to give evidence. The reliance placed by the learned counsel for the appellant on the evidence of the respondents' attorney is, therefore, misplaced as the attorney could only lead evidence on the facts which were within his knowledge. Further contends that the appellant failed to perform his part of the contract within the stipulated period, hence, the revocation of the Agreement as well as the GPA.
10. The learned counsel also refers to a partnership agreement dated 22-6-1996 purportedly having been entered into by the father of the appellant and the respondents' father, the photo- copy whereof has been brought on the record as Exh.D-4, to contend that as per the partnership agreement which was entered into in June, 1996, it was agreed between the father of the appellant and the father of the respondents that the Property would be sold to the Army Welfare Trust and the differential of the sale proceeds would be divided equally between the parties. Once the agreement of partnership dated 22-6-1996 was entered into novation of the (original) Agreement took place, therefore, the Agreement in any case cannot be specifically performed. Relies on the judgments reported as Sandoz Limited and another v. Federation of Pakistan and others (1995 SCMR 1431), Fmt. Chand Rani (dead) by L.R. v. Fmt. Kamal Rani (dead) by L.Rs, (AIR 1993 SC 1742), Messrs Imperial Builders through Managing Partner and another v. LINES [Pvt.) Ltd through Chief Executive and 3 others (PLD 2006 Karachi 593) and Mst. Batul and others v. Mst. Razia Fazal and others (2005 SCMR 544).
11. In rebuttal the learned counsel for the appellant submits that the appellant's father was not authorized by the appellant to enter into the so-called agreement of partnership. If indeed there was an agreement it was not binding on the appellant firstly for the reason that it was executed after filing of the suit and secondly the appellant was not a party thereto. If the respondents have any grievance in respect of the said agreement they should have filed a separate suit. As to the nonappearance of the appellant's father as a witness, submits that the appellant led the evidence himself and discharged the burden placed upon him.
12. Argument Ahead. Record perused.
13. A perusal of the record reveals that there are a number of admitted facts: that the Agreement (Exh.P-1) was entered into between the parties on 13-7-1995, that the GPA (Exh.P-2) was executed by the father of the respondents in favour of the appellant, that the GPA was retained by the father of the respondents and that the legal notice dated 8-2-1996 was served upon the father of the respondents. It is, therefore, established that the Agreement was executed and thereafter for one reason or the other the execution of the sale-deed did not take place within the stipulated period.
The father of the respondents does not appear to have filed a written statement. The written statement filed on behalf of the respondents does not mention the fact of entering of the agreement of partnership by the father of the appellant and the father of the respondents. This fact was brought on the record for the first time by the grandmother of the respondents who was arrayed as respondent No,4 in the suit. She took the stand of novation for the first time and as a consequence Additional Issues Nos.7-A and 7-B were framed.
14. From the above resume of facts it stands established that the Agreement was the governing document between the parties. Clauses (2) and (3) of the Agreement are material for determination of the controversy between the parties. The said Clauses are being reproduced hereunder for ease of reference:- "2. That the party of the first part, this day by a deed of general power of attorney appointed to the party of the second part as his general attorney in respect of afore stated property and the party of the first part hereby declares that he will not revoke, amend or alter the said deed of general power of attorney without the consent of the party of the second part. However, after execution of said deed of general power of attorney, the original shall remain in possession of party of the first part and the party of the second part will keep the duplicate copy and will not utilize the said deed of general power of attorney as far the powers contained therein till the full remaining sale consideration is paid off to the party of the 1st part by the party of the second part.
3. That for the purpose of remaining sale consideration amounting to RUPEES ONE CRORE by the party of the 2nd part to the party of the first part and for the purpose of execution of saledeed/deeds or to bring the power of attorney operative in connection with the transfer of afore-stated property, the period is agreed to be ending 31st December, 1995 or earlier with the consent of both the parties, is agreed between above named parties. That on the payment of remaining sale consideration the party of the first part will hand over the vacant and physical possession of the said property to the party of the second part."
15. A perusal of the above Clauses would go to show that in case of non-performance of the Agreement by the appellant no penalty has been stipulated and/or no penal consequences have been spelt out in case of non-performance of the Agreement by the appellant by the stipulated date. This fact lends support to the contention of the learned counsel for the appellant that since no penal consequences for non-performance of the Agreement by the appellant have been stipulated in the Agreement, therefore, time was not of the essence of the contract. On the other hand, the respondents have not been able to show or establish that in case of non-performance what was the liability which the appellant had to incur. Indeed, the impugned judgment is also silent as to the sum of Rs,35,00,000/- having been paid by the appellant to the father of the respondents. This sum has neither been ordered to be returned to the appellant nor has it been forfeited in favour of the respondents.
16. Another factor which goes in favour of the appellant is the fact that upon failure of the respondents' father to execute the sale-deed the appellant gave him a legal notice on 8-2-2006.
The legal notice was followed by filing of the suit for specific performance of the Agreement and also of depositing the balance consideration with the learned trial Court albeit the money so deposited was withdrawn by the appellant and replaced with the bank guarantee with permission of the learned trial Court.
17. It is a well-settled principle of law that normally in cases other than commercial contracts that is to say in contracts relating to immovable property even when a specific date is mentioned for performance of the contract time is not reckoned to be of the essence of the contract. It is similarly well-settled that in determining whether time is of the essence of the contract or not the intention of the parties in this behalf has to be gathered from the contents of the contract itself and the attending circumstances. Reliance in this regard is, inter alia, placed on the judgments reported as Abdul Hamid v. Abbas Bhai-Abdul Hussain Sodawaterwala (PLD 1962 SC 1) and Seth Essa Bhoy v.
Saboor Ahmad (PLD 1973 SC 39).
18. We, therefore, find that in the facts and circumstances of the case time was not of the essence of the contract. The contention, therefore, of the learned counsel for the respondents that time was of the essence of the contract is, therefore, repelled. The learned trial Court erred in holding otherwise.
19. As to the question of novation of the Agreement by virtue of the other of the respondents having entered into a partnership agreement with the appellant's father as canvassed by the learned counsel for the respondents it is worth noting that the written statement of the respondents is silent in this respect. This issue was raised for the first time by the grandmother of the respondents who was arrayed as defendant/respondent No,4. If indeed novation took place that was subsequent to filing of the suit. Courts can and do take notice of subsequent events but in the instant case the respondents were unable to establish that the partnership agreement had been entered into by the appellant himself. The original partnership agreement was never brought on the record nor was it proved in accordance with the law. The photocopy of the partnership agreement (Exh.D-4) was, however, brought on record. It shows that it was purportedly executed by the appellant's father and the father of the respondents. There is no Clause therein showing that it was entered into by the appellant's father with authorization from the appellant. We, therefore, do not find force in the contention of the learned counsel for the respondents that novation of the Agreement took place by virtue of the partnership agreement. The contention of the learned counsel is, therefore repelled.
20. Having held as above we, however, cannot ignore the fact that the discretion to grant specific relief has to be exercised in accordance with the settled and fixed principles of law and if the contract is unobjectionable in its nature then, a person seeking equity must do equity himself. The appellant having exercised his option to purchase the Property as per terms of the Agreement was required to deposit the balance consideration with the learned trial Court. He initially did so but he withdrew the same, therefore, the appellant has been earning profit on the balance consideration from the year 1996 to-date. In the meantime, prices of properties have also appreciated. A similar situation arose in a case which was decided by the Hon'ble Supreme Court and has been reported as Mst. Mehmooda Begum v. Syed Hassan Sajjad and 2 others (PLD 2010 SC 952). The Hon'ble Supreme Court whilst considering the principles of law relating to time being of the essence of the contract and whether specific performance should be allowed in terms of section 22 of the Specific Relief Act, 1877, after going through the case-law on the subject directed that an additional amount be paid to the sellers to compensate for the differential in the prices as also the loss of profit.
21. We, therefore, whilst accepting the appeal set aside the impugned judgment and decree dated 20-2-2006 of the learned trial Court and decree the appellant's suit for specific performance subject to payment of the balance consideration of Rs,90,00,000/- plus Rs,75,00,000/- as additional consideration. The total amount of Rs,1,65,00,000/- to be deposited by the appellant before 15-5-2013 in the learned trial Court otherwise the instant appeal shall stand dismissed.
22, There is no order as to costs.