' (a) This is a suit filed by Alvia Tableeghi Trust, a private Trust and its Trustees (hereinafter referred to as the Trust) for declaration, injunction and accounts etc. Originally defendant No, .8 being a Trustee of the Trust was shown as plaintiff No, 5 but was transposed into defendant No, 8 as he did not support the plaintiffs' case.
' The brief facts leading to the filing of the above suit are that plaintiff No, 2 Dr. Habibur Rehman Elahi Alvi created plaintiff No, 1 Trust in 1958 under Registered Trust Deed No, 562 of 1958 and also got it registered at Karachi in 1967 under Registered Trust Deed No, 527 of 1967. According to the averments in the plaint the Trust owns immovable landed property and also a salt work known as "Sind Salt Works" with its office at Zeenat Mansion, I. I. Chundrigar Road, Karachi. Defendant No, 1 is one of the sons of plaintiff No, 2 and was also a Trustee of the Trust and was also managing Sind Salt Works, on behalf of the. Trust. It has been averred that in or about August, 1976 another Salt Work, namely, "Khurshid Salt Work" (hereinafter referred to as the Salt Works) was offered for sale by its owners M/s. Khurshid Salt Limited and that plaintiff No, 2 became interested to purchase the salt work. It has been further averred that defendant No, 1 being the son and also a trustee of the Trust was instructed to pursue the matter and to finalize the sale. It has also been averred that the above transaction was finalized under the agreement, dated 28th August, 1976 Exh. 8 for a price of Rs, 7,50,000 out of which a sum of Rs, 1,50,000 was to be paid at the time of the execution of the sale agreement and the balance of Rs, 6,00,000 was to paid to the seller in 12 monthly instalments of Rs, 50,000 between months of March, 1977 and September, 1978 as per schedule to sale agreement, which payment was to be duly backed by a bank guarantee. It has been further averred that plaintiff No, 2 got the above bank guarantee from M/s. Muslim Commercial Bank Ltd. It has also been averred that it appears that from the beginning defendant No, 1, who was charged with the duty to finalize the purchase for the benefit of Trust developed dishonest and crooked mind and instead of acting in a clean and forthright manner played foul with the Trust and tried to advance his personal interest at the expense of the Trust and got the agreement made out in the name of faked partnership in the name of Habib Ocean Industries. It has been further averred that defendant No, 1 held out that Khurshid Salt Works had been changed to Habib Ocean Industries, Habibur Rehman being the name of plaintiff No, 2 in order to inspire confidence in him. But he did not disclose that Habib Ocean Industries was a self-styled partnership with totally unconcerned and strange people. It has also been averred that when questioned by plaintiff No, 2 about the mysterious partnership, defendant No, 2 tried to explain that this was a "ghost partnership" and that the partners shown were no other than himself, his own brother-in-law and their sons. It has been further averred that he also pursuaded that the agreement was obtained in the name of partnership to diversify the assets of the Trust and to hold different properties by different names. It has also been averred that plaintiff No, 2 did not accept his explanation and insisted that the bogus partnership should be forthwith dissolved and after two days defendant No, 1 turned up and produced letters of retirement/withdrawal from all the faked partners and assured that the final sale-deed would be obtained in the name of the real purchaser plaintiff No, 1 or in the name of plaintiff No, 2 the provider of the fund. It has been further averred that in spite of his earlier assurances defendant No, 1 is now trying to bypass plaintiffs Nos. 1 and 2. It has also been averred that in reality plaintiff No, 2 had contributed the entire value of the property either arranging cash or by securing bank guarantee and that defendant No, I has already recovered a total sum of Rs, 6,71,904 from plaintiffs Nos. 1 and 2 but has not duly accounted for. It has also been averred that defendant No, 1 has also drawn amount much in excess of the price disclosed in the sale agreement which be claims to have paid to the seller a sum of Rs, 5,00,000 for which he has not produced any receipt or acknowledgement and as such remains unaccountable. On the basis of the above averments the above suit was filed.
(b) Defendants Nos. 1 to 5 filed a joint written statement, in which the contents of the plaint have been denied. It has been averred that suit is misconceived and is not maintainable as framed and that it has been filed in contravention of section 92 of the C. P. C. It has been further averred that the purchase of the Salt Works from defendants Nos. 6 and 7 i. e. The previous owner was effected by defendants Nos. 1 to 5 in favour of defendant No, 2 partnership firm. It has also been averred that the possession of the Salt works was delivered to defendant No, 2 pursuant to the sale agreement between defendant No, 2 and defendants Nos. 6 and 7. It has been further averred that defendants Nos. 1, 3, 4 and 5 entered into a partnership deed on the 19th August, 1976and agreed to carry on business in partnership under the name and style of Habib Ocean Industries i. e. Defendant No,
2. It has also been averred that on 25th August, 1976 the partners of the said firm executed a Special Power of Attorney in favour of defendant No, 3 authorizing him to negotiate with Khurshid Salt Works Ltd. For the purchase of the Salt works situated at Mauripur. It has been further averred that the brother of defendant No, 1 (Attaur-Rehman Alvi, now defendant No, 8) who has been in Nigeria for the past several years expressed his willingness to help the defendants financially in setting up an independent business for defendant No, 1 and the other defendants and for this purpose he remittted to defendant No, 1 in Pakistan a sum of Rs, 1,63,651 in the month of May, 1976 and that the aforesaid partnership was formed after receiving the above fund and defendant No, 3 was authorised to negotiate the purchase of the Salt works. It has also been averred that on or about 28th August, 1976 an agreement was entered into between Habib Ocean Industries and Khurshid Salt Works Ltd. For the purchase of the Salt Works for a total consideration of Rs, 7,50,000 out of which a sum of Rs, 1,50,000 was paid to Khurshid Salt Works Ltd. From the fund remitted to Pakistan by plaintiff No, 4 (now defendant No, 8 (for the benefit of defendant No, 1 and the balance of Rs, 6,00,000, was agreed to be paid in 12 equal monthly instalments commencing from March, 1977. It has been further averred that necessary guarantee in favour of Khurshid Salt Works was furnished by Muslim Commercial Bank Ltd. On behalf of Habib Ocean Industries and a counter guarantee in favour of Muslim Commercial Bank Ltd. Was executed' by all the partners of Habib Ocean Industries. It has also been averred that plaintiff No, 2 was fully aware of this independent venture and business of the defendants with the fund made available by plaintiff No, 4 (i. e. Now defendant No, 8) and in fact requested the bank to furnish necessary bank guarantee and wife of plaintiff No, 2 deposited certain title deeds of the property standing in her name as the security and executed the letter of undertaking in favour of Muslim Commercial Bank Ltd. In June, 1977 and that the said documents were released by the bank and returned by the defendants to the plaintiff as substantial repayments were made by defendant No, 2 to the seller. It has been further averred that on taking possession of salt works from Khurshid Salt Works Ltd., business was carried by the defendants and instalments of Rs, 50,000 each were paid by defendant No 2 with effect from March, 1977 onwards upto the date with the result that Rs, 4,00,000 representing more than half of the balance consideration has been paid to Khurshid Salt Works Ltd. And liability for payment of the remaining amount is exclusively with the defendants, for which the defendants have furnished a counter-guarantee in favour of Muslim Commercial Bank Ltd. (It may be observed that the above written statement was filed on 12th November, 1977.) It has also been averred that the business of the Habib Ocean Industries and the purchase of the Salt Works from Khurshid Salt Works Ltd. Is the sale and exclusive business of the defendants and the plaintiffs have no right, title claim or interest therein of any kind or nature whatsoever and the claim now made in suit is totally dishonest, misconceived, incorrect and not a maintainable in law.
(c) Defendant No, 8, who was plaintiff No, 4 and was transposed as defendant No, 8 at his request as observed hereinabove has filed a separate written statement in which inter alia it has been averred that the contents of the plaint are admitted to be the extent that plaintiffs being Trust and plaintiff No, 2 its founder. It has been averred that although defendant No, 8 was induced and compelled to be shown as a co-trustee but yet no consent has either been taken from him or his signature has been obtained in the suit. In has been further averred that defendant No, 8 was approached by defendant No, 1 to help him financially as he wanted to establish his own business in the field of suit business and hence for this purpose the answering defendant had remitted an amount of Rs, 1,63,104. It has also been averred that defendant No, 1 had informed him that they had purchased M/s. Khurshid Salt Works in the name and style of Habib Ocean Industries, a partnership firm established by then alongwith defendants Nos. 3, 4 and 5. It has been further averred that from the very beginning it was very well in the knowledge of the plaintiffs that M/s. Khurshid Salt Works had been purchased in the name of M/s. Habib Ocean Industries which was established as a partnership firm. On the basis of the above averments it has been denied that the plaintiffs were entitled to any relief.
(d) Defendants Nos. 6 and 7 have filed a separate joint written statement, in which inter alia it has been averred that the suit was not maintainable as the same was filed without obtaining the consent of the Advocate-General under section 92, C. P. C. It has been denied that Khurshid Salt Works was over offered for sale by defendant No,
6. It has been averred that defendant No, 6 was interested in selling Salt Works owned by it and that the name "Khurshid" was never offered for sale alongwith the Salt Works, which belong to defendant No, 6 even after the sale agreement. It has been further averred that at all material times defendant No, 3 had visited the answering defendants for purchase of the Salt Work and that the demised Salt Works was sold by defendant No, 6 to defendant No, 2 under an agreement dated 28th August, 1976 for Rs, 7,50,000 out of which they received Rs, 1,50,000 on signing of the agreement and thereafter instalments of Rs, 150,000 per month were paid in terms of the sale agreement. It has been also averred that defendant No, 6 had so far received Rs, 5,50,000 from defendant No,
2. It has been further averred that defendant No, 2 has submitted with defendant No, 6 a copy of partnership deed dated 19th August, 1976 and a bank guarantee of Muslim Commercial Bank Ltd. For the payment of the instalments as provided under the said agreement. It has been further averred that defendant No, 6 had agreed to sell the demised salt works to defendant No, 2 for valuable consideration without any knowledge of the alleged claim of the plaintiffs. It has also been averred that in pursuance to legal notice, dated 27th July, 1977 addressed to answering defendants, defendant No, 6 by his letter, dated 30th August, 1977 requested the Advocate for plaintiff No, 1 to furnish absolute proof in support of their claim and allegations but no reply was sent. It has been denied that the plaintiffs are entitled to any relief against the answering defendants. It has been averred that the suit is liable to be dismissed with compensatory costs to these defendants.
(e) On the basis of the pleadings of the parties, the following four issues were framed :-
(1) Whether the suit is misconceived and not maintainable as framed ?
(2) Whether the suit has been filed in accordance with section 92, C. P. C. ? If not what is effect?
(3) Whether the defendant No, 2 has purchased the Salt Work on its own behalf or on behalf of the Trust ?
(4) What should the decree be?
2. In support of the suit plaintiff No, 2 Dr. Habibur Rehman Elahi Alvi examined himself as P. W. 2 Exh.
15, P. W. 1 Syed Abdul Wadood an Officer of National Bank of Pakistan, Liaquat Bazar Branch, Karachi Exh. 6, P.W. 3 Akhtar Hussain, a retired Senior Civil Servant and Chairman of the Trust Exh. 16, P. W. 16, P. W. 4 Pir Mahfooz Exh. 17, a businessman and P. W. 5 Aftab Ahmed Khan retired Managing Director, National Bank of Pakistan. On the other hand defendant No, 8 examined himself as D. W. 1 Exh. 19 whereas defendant No, 1 examined as D. W. 2 Exh.
20.
' The parties have also produced a number of documents for and against their respective claims.
' It may be observed that issue No, 2 was not pressed and, therefore, no arguments were advanced.
3. (a) The basic issue, is issue No,
3. In support of the plaintiffs' case it has been vehemently urged by Mr. Ibadat Yar Khan, learned counsel for the plaintiffs that from the oral and documentary evidence, it has been proved that the Salt Works was purchased by defendant No, 1 in the name of defendant No, 2 on behalf of the Trust and not for the benefit of the partnership. On the other hand, it was vehemently urged by Mr. Liaquat Merchant, learned counsel for defendants 1 to 5 that the evidence on record has conclusively proved that the Salt Works was purchased for the benefit of the partnership defendant No, 2.
(b) In my view, the above issue No, 3 inter alia involves following questions :-
(i) Whether in fact defendant No, 1 was instructed by plaintiff No, 2 to negotiate for the purchase of the Salt Works for the Trust and in fact concluded the above negotiation on behalf of the Trust?
(ii) Who provided the consideration.
(iii) What was the conduct of the parties after the purchase?
(c) As regards the above first point, it may be observed that in order to prove the first point plaintiffs have examined plaintiff No, 2 P.W. 2 Habibur Rehman Alvi, P.W. 3 Akhtar Hussain, P.W. 4 Pir Mahfooz and P.W. 5 Aftab Ahmed Khan. It may be advantageous to reproduce in verbatim what has been stated by the above witnesses on the above point :-
(i) P.W. Dr. Habibur Rehman Elahi Alvi has deposed as follows :- "In the year 1975 I came to know that Khurshid Salt Works is for sale, which is owned by Dinshaws. I convened a meeting of the Trustees and at the meeting the Trustees decided that a Trust should make an effort to purchase Khurshid Salt Works. This Salt Works was owned by a Parsi family. The Trustees and I thought that we should offer to purchase this property not in the name of plaintiff No, 1 because the Parsi owners might not like to sell the property to a Trust, whose one of the main functions is Tableegh and accordingly it was decided to obtain this property in the name of Habib Ocean Industries which incorporate a part of my name.
' I entrusted the negotiation to my son Mujibur Rehman Alvi defendant No, 1 for purchasing Khurshid Salt Works from Dinshaws. In November, 1975 defendant No, 1 congratulated me for his having successfully negotiated purchase of Khurshid Salt Works. He informed me that the property had been agreed to be purchased for Rs, 74 lacs. He further informed me that a sum of Rs, 12 lacs was to be paid at the time of the sale agreement and the remaining amount was to be paid in 12 monthly instalments and a bank guarantee for the balance of Rs, 6 lacs was to be provided to the seller. Accordingly I negotiated it with the National Bank of Pakistan, Central Office on I.
1. Chundrigar Road, Karachi for providing bank guarantee. Mr. Akhtar Hussain was the Chairman of the Trust and he also exerted his own influence on the National Bank of Pakistan for their agreeing to provide bank guarantee by them. Mr. Aftab Ahmed Khan, who was then retired Deputy Managing Director of the National Bank of Pakistan used his influence over the bank for providing the bank guarantee..
' The National Bank of Pakistan had agreed to provide a bank guarantee provided we give security.
The Trust offered its property as security, but the Bank did not accept the properties of Trust as security. Thereafter Mr. Akhtar Hussain, Chairman of the Trust advised me to approach the Muslim Commercial Bank for obtaining the bank guarantee from them. I, therefore, approached Pir Mahfooz who was my friend to help us in obtaining bank guarantee from the Muslim Commercial Bank. Pir Mahfooz informed me that Muslim Commercial Bank has agreed to provide guarantee on behalf of the Trust provided I or my wife should furnish counter-guarantee and security of our property. Accordingly I provided the security of the three plots of land which were standing in my name but which were also be used for the Trust and the security of the house of my wife. The plots of land are situated in Gulshan and the house is situated in the Muhammad Ali Memorial Housing Society, Karachi. The Muslim Commercial Bank had kept the documents of the aforesaid properties with them as security. Thereafter Muslim Commercial Bank issued a bank guarantee in favour of Khurshid Salt Works Ltd. And the Dinshaws delivered possession of Khurshid Salt Works Ltd. To me."
(ii) P.-W 3 Akhtar Hussain has stated as follows :- "I know Dr. Elahi Alvi. I know about Alvi Tablighi Trust. I am the Chairman of the Trust since 1967. It is a private Trust. All the funds to the Trust were contributed by Dr. Elahi Alvi, from his professional and personal earnings.
' About four or five years ago, Dr. Alvi had called me to his surgery.
' He told me that Salt Works owned by some Parsi gentlemen was available for sale and that the Trust would like to purchase it. Dr. Elahi's son Mujibur Rehman was there and he was told to negotiate for purchase of the Salt Works. He was at that time one of the Trustees of the Trust. He was told by me as well as by Dr. Elahi Alvi. The Salt Works was to be purchased for the benefit of the Trust. Dr. Alvi told me that Parsi gentlemen might not like to sell Salt Works to the Tableeghi Trust and, therefore, it was decided to purchase the same in the name of Habib Ocean Industry.
Sometime thereafter I was called by Dr. Alvi again and I was told by him that the negotiations for purchase of the Salt Works were successful. A sum of Rs, 7,50,000 was mentioned as sale consideration and one and half lacs were required to be paid in cash and for the remaining amount of Rs, 6 lacs, the seller wanted bank guarantee. Dr. Alvi asked me to help him in getting the bank guarantee, and he mentioned certain names of a gentleman who was Manager of a bank. I told him that I knew him very well as he was nephew of the friend of mine. The name of the Manager was Ghulam Hussain Manager of the National Bank of Pakistan (Branch). I was told later on by Dr. Elahi Alvi that he was not able to get a bank guarantee from the said Manager. I had contacted the Manager through telephone to recommend a bank guarantee. The contact was made before the guarantee was refused by National Bank of Pakistan. Later on Dr. Alvi through the good office of kir Mahfooz was able to get the bank guarantee from the United Bank Limited.
' P.-W 4 Pir Mahfooz has deposed as follows : - "In the year 1976 the Chairman of Muslim Commercial Bank or President of Muslim Commercial Bank was my friend. I know Dr. Elahi Alvi very well. There was a talk about purchase of Khurshid Salt Works between me and Dr. Alvi. Dr. Elahi Alvi wanted to buy Khurshid Salt Works on instalments and for that he wanted a bank guarantee. He asked me to approach Mr. Garda who was then President of Muslim Commercial Bank and happened to be my ' friend. Dr. Elahi Alvi wanted my help for requesting Muslim Commercial Bank to become guarantor on Trust's behalf for payment of sale consideration of Khurshid Salt Works in instalments. Dr. Elahi Alvi wanted to purchase Khurshid Salt Works for Alvia Tableeghi Trust which he had floated some years back. This talk took place in the clinic of Dr. Elahi Alvi when I dropped in on my way from my office to home. At that time Mujibur Rehman and Dr. Arif were present in the clinic. Both are his sons. This talk took place in their presence. I talked to Mr. Garda and he agreed that his bank would become a guarantor subject to Dr. Elahi Alvi giving the security of his property by way of equitable mortgage to the bank. I had told Mr. Garda that it was a charitable Trust and a good cause to provide bank guarantee. Mr. Garda said that guarantee would be given if security of the property of Dr. Elahi Alvi or his wife is given. I was told after quite some time that the transaction had materialized."
(iv) P,-W 5 Aftab Ahmed Khan has stated as follows :- "I am no more in National Bank of Pakistan. I have already retired. I was not in National Bank of Pakistan in or about the year 1976. I remained connected with the National Bank of Pakistan for over 20 years. I know Dr. Elahi Alvi. In the year 1975 or 1976 Dr. Elahi Alvi alongwith his son Mujibur Rehman had come to me to my house. He told me that he was purchasing Khurshid Salt Works in the name of Alvia Trust. He told me that he had paid some cash and remaining amount was to be paid through a bank guarantee. As far as I can remember the amount was Rs, 6 lacs. He had asked me to talk to some officer in National Bank of Pakistan for giving guarantee as I had remained connected with the Bank. I talked to the Officer concerned to consider his case as he was in a position to provide the necessary security and owned some property. He had told me that Mujibur Rehman would come to me to know the progress of the case from time to time. Thereafter Mujibur Rehman came to me once or twice and informed me that he had come under the directions of Dr. Alvi and he informed me of the difficulties which he was coming across from the Bank. As far as I know that the bank had sanctioned the guarantee but bank's terms and conditions were such that Dr. Alvi could not or did not perform. Thereafter I came to know that Dr. Alvi had arranged some guarantee through another bank. Dr. Alvi had told me in the presence of Mujibur Rehman that he was purchasing Khurshid Salt Works for the Trust and he had given out the names of the trustees.-
(d) Against the above evidence defendant No, 1 has examined himself. The evidence of defendant No, 8 on the above point does not inspire any confidence as he was at the relevant time in Nigeria.
In his letter Exhs. 19/1 and 19/2 through which he remitted the amount referred to hereinbelow, he has not made any reference to the fact that defendant No, 1 intended any Salt Work. In my view even if I were to ignore the testimony of P.W. 2, Dr. Elahi Alvi, the evidence of the above three witnesses, who are men of statutre and of standing and have no plausible reason to depose falsely at the stage of their advanced ages, has proved that in fact defendant No, 1 was authorised to negotiate on behalf of the Trust. It may be observed that Mr. Akhtar Hussain at the time of his examination in Court was 78 years old. He is a retired Senior Civil Servant and had held a number of public offices A including of the Governor of the erstwhile West Pakistan. He has been cross- examined by the learned counsel for defendants Nos. 1 to 5 at length but the above witness has not been shaken on the above point, namely, that the defendant No, 1 was authorised to negotiate to purchase Khurshid Salt Works on behalf of the Trust. The cross-examination of the above witness was directed to solicit the fact that there was no meeting of the Trustees of the Trust and there was no decision made for the purchase of the said Salt Works. The above witness has frankly stated that there was no recorded decision authorising Mujibur Rehman to negotiate and to purchase the Salt Works for the Trust as far as he knew. He has also stated that there was no meeting of the Trustees, where it was discussed or decided to purchase the Salt Works from Parsi gentlemen.
However, he has denied that discussion took place between him and Dr. Elahi Alvi alone and stated that there were other Trustees, namely, his two sons again stated more sons. It was also suggested to him that in fact he was deposing on the basis of the discussion with Dr. Alvi, to which his reply was that he discussed the matter last about 20 days or more when he received a notice from this Court to appear before the Court and that at that time he asked Dr. Alvi what was it all about. He has further stated that he discussed it generally with Dr. Alvi what he has deposed in the Court but it was not exactly as he has now deposed.
' Similarly nothing has been brought on record in the cross-examination P.-W. Pir Mahfooz to impair his testimony on the above point. In reply to the defendant No, 8's Advocate he has stated that he was patient of Dr. Elahi Alvi and did not know if Dr. Attaur Rehman and Mr. Garda of Muslim Commercial Bank were class-fellows in Aligarh Muslim University.
' In my view the above witness would not have falsely deposed only for the reason that he was a patient of plaintiff No,
2. Furthermore, his testimony stands corroborated by other witnesses on the material points.
' No cross-examination was directed to test the veracity of the testimony of P. W. 5 Aftab Ahmed Khan, a retired Managing Director of the National Bank of Pakistan. His statement that Dr. Alvi had told him in the presence of Mujibur Rehman that he was purchasing Khurshid Salt Works for the Trust or that Dr. Alvi and defendant No, 1 came to his house for seeking his assistance for obtaining bank guarantee of Rs, 6 lacs on behalf of the Alvia Trust remained unchallenged as no cross- examination was done by any of the Advocates for the defendants.
(e) However, it was urged by Mr. Liaquat Merchant that at the most the testimony of the above three witnesses indicate that initially the Trust was interested in purchasing the Salt Works but the same does not prove that negotiations were concluded by defendant No, 1 on behalf of the Trust. In my view, the above contention is devoid of any force. It may again be noticed that the assistance of the above three witnesses was sought for furnishing bank guarantee for Rs, 6 lacs in favour of the vendor, which was the stage when the negotiations had already been finalized i. e. The terms of the agreement were settled between the parties and inter alia it was agreed that the balance price of Rs, 6 lacs was to be paid in monthly instalments of Rs, 50,000 and bank guarantee for Rs, 6 lacs was to be furnished in terms of the agreed schedule of payment, which was subsequently reflected in the sale agreement and also in the Bank Guarantee furnished by Messrs Commercial Bank Ltd.
( 1) It was next contended by Mr. Liaquat Merchant that there is material discrepancy between the case as disclosed in the plaint and the testimony of the above witnesses including of that Dr. Alvi inasmuch as in the plaint it has been averred that the Salt Works was to be purchased in the name of the Trust and that defendant No, 1 proceeded to purchase the same in the name of a bogus partnership, whereas in the testimony P.W. Dr. Elahi Alvi and P.W. 3 Akhtar Hussain, it has been deposed that the Salt Works was to be purchased in the name of Habib Ocean Industries in order to avoid any opposition from the Parsi vendor on the ground that the purchaser being an Islamic Tablighi Trust. The testimony of the other two witnesses namely, Pir Mahfooz and Aftab Ahmed Khan also indicates that the bank guarantee was to be furnished on behalf of the Trust. There seems to be above inconsistency between pleadings and the depositions. However, there is no inconsistency between the pleadings and the testimony of the above witnesses on the point that the Salt Works was to be purchased for the benefit of the Trust. The inconsistency is about the mode of finalization, namely, whether it was to be purchased directly in the name of the Trust or for the Trust in the name of defendant No,
2. It may be observed that some concession is to be accorded to plaintiff No, 2 on account of his old age being more than 80 years. Some inconsistency/contradiction is bound to occur. Mr. Laiquat Merchant has invited my attention to some of the contradictions and infirmities in the testimony of plaintiff No,
2. Since I have mainly relied upon the documentary evidence, the above contradictions and infirmities are of no legal consequence.
' It may be pointed out that defendant No, 1 in his deposition has admitted that he had borrowed a sum of Rs, 5,000 from his father plaintiff No, 2 Dr. Alvi and opened a bank account in January, 1976 in the name of Habib Ocean Industries. The latter was merely a trade name and not a partnership firm till 19th August, 1976 when defendant No, 2 firm was formed (and the entry of the firm on the register of Firms Registrar was made on 5th September, 1977) as is indicated from the certificate of Registration Exh.
7. Nothing has been brought by defendant No, 1 on record to indicate that he had carried on any business in the name of Habib Ocean Industries, which was adopted as a trade name by him prior to converting it into a registered firm just few days before the date of the sale agreement in question. Futhermore, defendant No, 1 has not been able to prove that this firm was incorporated as a partnership on 19th August, 1976 with the consent and knowledge of plaintiff No,
2. It has come on record that when plaintiff No, 2 discovered that defendant No, 1 purchased the Salt Works in the name of a private partnership, he inquired from defendant No, 1, who in order to satisfy him handed over Exhs. 15/1 to 15/8. Defendant No, I had denied his signature on Exhs. 15/1 and 15/2. It may be observed that Exh. 15/1 is an alleged letter written by defendant No, 1 forwarding the documents mentioned therein, including letters of retirement from defendant No, 2 firm and public notices for retirement written by defendants Nos. 3, 4 and 5 and admitting the factum that the Salt Works was purchased for the Trust, Exh. 15/2 is a statement containing the detail of a sum of Rs, 2,20,000 received from plaintiff No, 2 for the purchase of Khurshid Salt Works. Though defendant No, 1 has denied his signature on the above two documents Exhs. 15/1 and 15/2 but has not challenged P. W. 2 Dr. Alvi's statement that these two documents alongwith Exhs. 15/3 to 15/8 were handed over by him to plaintiff No,
2. According to defendant No, 1, defendant No, 3 Asrarul Haq (his brother-in-law and son-in-law of plaintiff No, 2) was his dependent, defendant No, 4 is son of defendant No, 3, whereas defendant No, 5 is son of defendant No,
1. The above Exhs. 15/3 to 15/8 clearly indicate that the above partnership was not to operate but was incorporated a few days before the date of sale agreement, dated 28th August, 1976 in question Exh. 8, with the object to finalize the above sale transaction. If in fact it was a genuine firm intended to operate there was no occasion for defendants Nos. 3 to 5 to deliver the above letters of retirement and the public notice for retirement immediately after the finalization of the above sale transaction. I am inclined to believe that the above letter of retirements and notices of retirement Exhs. 15/3 to 15/8 were handed over by defendant No, I to plaintiff No, 2 in the circumstances deposed by the latter. The above documents Exhs. 15/3 to 15/8 stand corroborated by the draft deed in dissolution of partnership Exh. 15/9, It is true that defendant No, 1 has denied of having been associated with the preparation of the above draft deed of dissolution or the typing of fair deed Exh. 15/10 but these two documents i,e, draft and the fair dissolution deed are to be read with Exhs. 15/3 to 15/8, which have not been denied and which clearly indicate that there was talk of dissolving the firm as deposed to by P.W. 2 Dr. Alvi.
According to defendant No, 1 no other partner has contributed anything towards the purchase of the Salt Works. In this view of the matter, it can be said that the names of defendants Nos. 3 to 5 were used in the partnership having factually no interest of their own.
(g) It was also contended by Mr. Liaquat Merchant that from the evidence of the plaintiffs on record, it is evident that there was no resolution of the Trustees for purchasing the Salt Works in question and that in fact so-called Tableeghi Trust has not constructed any mosque Madrasah for imparting religious knowledge or any charitable institution but in fact it is a fake Trust and, therefore, it could not have purchased the Salt Works. It cannot be overlooked that it is a private Trust, a creation of plaintiff No,
2. The Trust Deeds have been brought on record Exhs. 15/38, 15/39 and 15/39A, which indicate the objects or the Trust include establishment of Centre for Tableegh Islam, establishment of Dental College and charitable clinic etc. It has not been denied even by the defendants Nos. 1 to 5 and 8 that the above Trust owned Sind Salt Works, which was run by defendant No, 1 as the Trustee as well as the Manager of the Trust. It seems to be true that the above Trust has not constructs any mosque or M adarasah or charitable institution but this fact would not result in the dissolution of the Trust not it would affect the validity of the Trust. It may also be observed that all the trustees except defendant No, 8 have joined in the suit and this fact indicates that the transaction was effected with their knowledge and consent. It cannot be denied that it was a good bargain beneficial to the Trust, which is evident from the profits and the fixed deposits shown by the Receiver in his recent report. The matter was admittedly discussed between the trustees before defendant No, 1 was authorized to negotiate for purchase of the Salt Works.
Absence of a formal resolution would not invalidate the transaction.
(h) It was also contended by Mr. Liaquat Merchant that plaintiff No, 1 has come forward with the claim of the Trust after in fact defendants Nos. 1 to 5 had already paid the entire sale consideration to defendants Nos. 6 and 7 and waited till then. In support of his above contention, he has invited my attention to the admission on the part of the plaintiff No, 2 (P. W. 2) that all the instalments were paid by July, 1977 and thereafter he sent a notice and also the statement of D. W. 2 defendant No, 1 on the above point. The above position seems to be factually incorrect. Defendants Nos. 1 to 5 in their written statement, which was filed on 10th November, 1977 have averred in para. 9 ( f ) that they had paid Rs, 4 lacs more than half of the balance consideration up to the date of the filing of the above written statement. Whereas defendants Nos. 6 and 7 the vendor filed their written statement on 26th October, 1977 and have averred that they have received payment of Rs, 5,50,000 i. e. Rs, 1,50,000 at the time of the execution of the sale agreement and Rs, 4 lacs in instalments. As per agreement the last instalment was to be paid upto February, 1978 i. e. Between the period from March, 1977 to February 1978 at Rs, 50,000 per month. Apart from that, from the evidence on record i. e. The handing over of Exhs. 15/1 to 15/8 and Exh. 15/11 (which is in defendant No, l's handwritten accounts containing the detail of the amounts raised for the purchase of the Salt Works) by defendant No, 1 to plaintiff No, 2 and also the statement of D. W. 1 (defendant No, 8) Dr. Attaur Rehman to the effect that prior to the filing of the suit efforts were made to settle the matter, indicate that plaintiff No, 2 was not in fact waiting for the full payment of the consideration by defendants Nos. 1 to 5 before coming out with the claim of the Trust to the Salt works as has been urged by the learned counsel for defendants Nos. 1 to 5.
4. (a) Referring to the question, as to who has paid the consideration, it may be observed at the outset that under tho sale agreement dated 28th August, 1976 Exh. 8 only a sum of Rs, 1,50,000 was to be paid at the time of the execution of the said sale agreement and the balance was to be paid in instalments of Rs, 50,000 per month backed by a bank guarantee. It is an admitted position that Rs, 6 lacs were paid out of the earning of the Salt Works after it was put into operation. However, the question Rs, Ps. {{TABLE TEXT}} 1,19,000 00 1,19,000 00 ' which requires consideration is, as to whether Rs, 1,50,000 or any other amounts were provided by defendant No, 1 or by the Trust. According to defendant No, 1, he had paid Rs, 1,50,000 out of the remittance of Rs, 1,63,651 remitted by his real brother defendant No, 8 by May, 1976. On the other hand, it has been contended by Mr. Ibadat Yar Khan that the payment of Rs, 1,50,000 from the money provided by plaintiff No, 2 and the Trust stands proved from the documentary evidence on record. In support of its above submission he has referred to Exh. 20/1 a statement of bank account No, 8075 maintained by defendant No, 2 Habib Ocean Industries with Messrs National Bank of Pakistan, Liaquat Branch, Exh. 9/1 a statement of bank account No, 1126 maintained by defendant No, 2 with Messrs Muslim Commercial Bank Ltd. Mithadar Branch, Karachi, Exh. 15/22 a counterfoil of cheque No, B/22/198472, dated 11th August, 1976 for a sum of Rs, 31,000 drawn self from the account No, 7767 maintained by Messrs Sind Salt Works belonging to the Trust and a debit voucher dated 9th August, 1976 for a sum of Rs, 1,19,000 allegedly signed by defendant No, 1 Exh. 15/12.
(b) It may be advantageous to reproduce hereinbelow the above debit voucher which reads as follows :- "DEBIT VOUCHER SIND SALT WORKS Karachi, 9th August, 1976 ' DEBIT Habib Ocean Industries Pay to Mr. Mujibur Rehman Alvi.
' On account of : ' Purchase of Khurshid Salt Works Total Rupees Paisas : One lac nineteen thousand only.
' Received the amount as state aboved in full.
Signature.
(Sd.)
Manager."
' The above voucher indicates that a sum of Rs, 1,19,000 was drawn for the purchase of Khurshid Salt Works on 9th August, 1976. This voucher has been allegedly signed by defendant No, 1, who had denied the signature in his examination-in-chief on this voucher but admitted in the cross- examination that the signature on this voucher is similar to the admitted signature on Exhs. 6/2, 6/3 and 6/4. The amount mentioned in the above voucher, namely, Rs, 1,19,000 was deposited on the same day in defendant No, 2's account No, 8075 Exh. 20/1, whereas the above cheque of Rs, 31,000 from the account No, 7767 pertaining to Sind Salt Works was encashed on 11th August, 1971 by the Accountant of Sind Salt Works through a cheque drawn by defendant No, 1 jointly with plaintiff No, 2 and according to the plaintiffs, out of the above sum of Rs, 31,000, Rs, 30,000 were deposited on the very date in the above account of defendant No, 2, namely, account 8075 Exh. 20/1. A sum of Rs, 1,50,000 was withdrawn by defendant No, 2 from the above account on 11th August, 1975. On the very day, a sum of Rs, 1,53,000 was deposited in the defendant No, 2's aforesaid A/c No, 1126 Exh. 9/1 and from that a sum of Rs, 1,50,000 was drawn on 25th August, 1976 for getting a pay order prepared for the payment of Rs, 1,500,00 under the sale agreement Exh.
8. It has been vehemently urged by Mr. Ibadat Yar Khan that these documents clearly establish that the above sum of Rs, 1,50,000 were paid from the money provided by plaintiffs Nos. 1 and 2. On the other hand it has been vehemently contended by Mr. Liaquat Merchant that Exh. 15/12 i. e. The above-quoted voucher for Rs, 1,50,000 is a forged document inter alia for the following reasons :- #TBS (i) #TBE That defendant No, 1 has denied the signature on the above voucher.
(ii) That as per averment in the plaint the Salt Works was to be purchased in the name of the Trust and, therefore, there was no occasion For Sind Salt Works to pay a sum of Rs, 1,19,000 to defendant No, 2 for purchasing it in its name.
(iii) That the voucher does not contain signature of the person who received the above sum as it is blank.
(iv) That it does not indicate, whether this amount was paid cash or through a cheque.
(v) That the plaintiffs Nos. 1 and 2 have not produced the accounts book to indicate that any such sum was paid from the account of Sind Salt Works.
(vi) That the voucher has been prepared by someone else and was allegedly signed by defendant No, 1.
' It may be pertinent to quote hereinbelow defendant No, l's statement in the cross-examination about the above voucher and deposit of the above two sums of Rs, 1,19,000 and Rs, 30,000 in the above account No, 8075 Exh. 20/1 and the withdrawal of Rs, 1,50,000 and deposit of Rs, 1,53,000 reads as follows :- "When cash is paid a debit voucher is prepared. Signature on Exhs. 6/2 6/3 and 6 /4 and 15/12 are similar, but I have denied the execution 15/12 because no payment was made to anybody. The date on Exh. 15/12 is 9th August, 1976. I see Exh. 6/1. It is the statement of account of Habib Ocean Industries. It is correct that in this account a sum of Rs, 1,19,000 has been deposited on the same date i. e. 12th August, 1976 It is correct that I was operating this account. I had withdrawn from the bank Rs, 1,70,000 and out of that I had deposited Rs, 1,19,000 in the same account. It is correct that Exh. 6/5 a sum of Rs, 31,000 was withdrawn from Sind Salt Works on 11th August, 1976 and payment was collected by Abdul Haleem. It is also correct that on 11th August, 1976 a sum of Rs, 30,000 was deposited in the account of Habib Ocean Industries bearing No, 8075. It was a coincidence (volunteers). It is correct that on 11th August, 1976 I withdrew a sum of Rs, 1,50,000 from account No, 8075. It is correct that on 11th August, 1976 I opened an account with the Muslim Commercial Bank Ltd., bearing 1126 with a sum of Rs, 1,53,000. It is correct that on 25th August, 1976 I withdrew a sum of, Rs, 1,50,000 from this account in cash. The account of Rs, 1,50,000 was paid to Khurshid Salt Works, Dinshaws by pay order, in the sum of Rs, 50,000."
' It may be noticed that in the above-quoted statement defendant No, 1 admitted the factum that signature on Exh 12/15 is similar to that on admitted documents, namely, the cheques Exhs. 6/2, 6/3 and 6/4 and has stated that he had denied the execution of 15/12 because no payment was made to anybody. In other words, the reason for denial is the non-payment and not that the above voucher does not contain his signature. Furthermore, the amount of Rs, 1,19,000 is also reflected in Exh. 15/2 (on which defendant has denied his signature though the compliance of the signature on this document with defendant No, l's admitted signature gives impression that it contains defendant No, l's signature. The total amount of the two amounts credit on 2nd July, 1976 and 4th August, 1976 i. e. Rs, 30,000 and Rs, 89,000 comes to Rs, 1,19,000 respectively. However, it may be observed that even if Exh. 15/2 is to be excluded from consideration, there is other documentary 'evidence on record on the question of payment of Rs, 1,50,000.
(c)(i) In my view Exh. 15/11 which is defendant No, l's handwritten account, handed over by him to plaintiff No, 2 and which has been produced by P. W. 2 through his examination-in-chief, and which has not been challenged by defendants Nos. I to 5 has direct bearing on the controversy in issue. It may be pointed out that this document has not been denied even by defendants Nos. 1 to 5.
Defendant No, 1 has not refuted this document. The above document has two pages. One page relates to the account for the period commencing from 27th November, 1975 to 2nd July, 1976, whereas the other page has two parts. The first part relates to the payment of Rs, 1,50,000 through a pay order and the second part relates to the detail of total amount of Rs, 6,71,904. It may be advantageous to reproduce hereinbelow, the first page relating to the period commencing from 5th November, 1975 to 2nd July, 1976, which reads as follows :- {{TABLE TEXT}} "Iqbal 50,000 Sharif 20,000 Nasir 30,000 1,00,000 27-11-75 1,00,000 Shard 25,000 27-5-76 Ata 98,931 12-5-76 Majib 3,5721 25-5-76 Bank loan 45,000 4-6-76 2,00,000 2,04,652 Bashir Jacobabad through Iqbal 25,000 17-6.76 @ 3% Abbaji 54,000 21-6-76 Ata 28,452 22-6-76 Abbaji (Anis Bhai) 10,000 28-6-76 A/c Valition through 27,000 29-6-76 Khawaja @ 3% Asrar 7,800 29-6-76 Sharif 18,000 2-7-76 1,70,252 SSW 30,000 2-7-76 2,00,252 2-7-76 2,00,000 5,00,000 ' The above-quoted account in the hand of defendant No, 1 indicates that during the period commencing from 27th November, 1975 to 2nd July, 1976 a total sum of Rs, 5,04,704 was acquired from different sources including the above sum of Rs, 1,63,651, from defendant No, 8 (Dr. Ata-ur- Rehman) the break-up of which is Rs, 98,931 received on 12th May, 1976, Rs, 35,721 received on 25th May, 1977 and 24,452 received on 2nd June, 1976. It also indicates that Rs, 54,000 and Rs, 10,000 were paid by plaintiff No, 2 on 21st June, 1915 and 25th June, 1975, respectively, and a sum of Rs, 30,000 paid by Sind Salt Works on 2nd July, 1975. It further indicates that defendant No, 1 and defendant No, 3 contributed Rs, 45,000 and Rs, 7,800, respectively. Some of the other sums have been shown as borrowed at the rate of 3%. The total amount of the aforesaid various sums comes to Rs, 5,04,904. The above-quoted page also indicates that three payments totalling Rs, 5 lacs were debited against the aforesaid total, namely, Rs, 1,00,000 on 27th November, 1975, Rs, 2 lacs on 4th June, 1976 and Rs, 2 lacs on 2nd July, 1976. Incidentally, it may be observed that the above page of Exh. 15/11 lends support to P. W. 2's statement that the negotiations started in 1975 and defendant No, 1 congratulated him in November, 1975 for the successful conclusion of the negotiations. It is true that as per para. 3 of the plaint negotiations started in or about August, 1976. According to Mr. Ibadat Yar Khan, it is a typing mistake and it should be read as 1975,
(ii) It may also be advantageous to reproduce hereinbelow the other page of the above document, which reads as follows :--{{TABLE TEXT}} "Bashir Jacobabad 25,000 5-7-76 through Iqbal at 3% Sharif 9,000 6-7-76 Valition through 33,000 11-7-76 Khawaja at 3% -do-- 40,000 16-7-76 1,07,000 S S W 31,000 11-8-76 Abbaji shop a/c 15,000 1,53,000 Pay Order 25-8-1976 1,50,000 Ata 1,63,104 Mujeeb 45,000 Asrar 7,800 Abbaji 79,000 Abbaji 14,000 (not obtained in bank)
Other 3,02,000 loans 6,10,904 SSW 61,000 6,71,904 {{TABLE TEXT}} ' The above first half page of the above document, indicates that between 6th July, 1976 to 16th July, 1976 a total sum of Rs, 1,07,000 was borrowed from the persons named at the rate of 3%.
Furthermore, Rs, 31,000 were received fram Sind Salt Works on 1 1 th August, 1976 1. e. The amount reflected in the counterfoil of the cheque dated 11th August, 1976 Ex. 15/22 referred to hereinabove and a sum of Rs, 15,000 was received on account of "Abbaji shop account" (1. e. Plaintiff No, 2) thus making a total of Rs, 1,53,000. Out of this amount of Rs, 1,53,000 a sum of Rs, 1,50,000 was paid to the defendants Nos. 6 and 7 on 25th August, 1976 through a pay order which is clearly indicated in the above first half portion of the page.
' The remaining half of this page gives the details of the total sum of Rs, 6,71,904 raised from the various sources including Rs, 1,63,104 from defendant No, 8 Dr. Attaur Rehman, Rs, 45,000 from defendant No, 1, Rs, 7,800 from defendant No, 3, Rs 79,000 and Rs, 14,000 from, plaintiff No, 1 and Rs, 3,02,000 from other loans. From the above document, it is evident that Rs, 1,50,000 were not paid out of the money remitted by defendant No, 8 Attaur Rehman but was paid from the various amounts contained in the first half of the second page of the above-quoted handwritten accounts of the defendant No, 1 referred to herein-above.
(iii) It may again be pointed that the aforesaid quoted page 1 indicates that three amounts (totalling a sum of Rs, 5 lacs) were debited in this account on three different dates. P.W. 2 Dr. Elahi Alvi's statement that he was told by defendant No, 1 that a sum of Rs, 5 lacs was paid in addition to the amount indicated in Exh. 8 gets support from this document as well as from the schedule to the plaint, in which plaintiff No, 1 under the caption "Schedule of payment from the plaintiff towards the purchase of Khurshid Salt Works" gives the following detail :{{TABLE TEXT}} Rs, Dr. Elahi Alvi Trustee 1,61,800 From Sind Salt Works 1,97,000 Dr. Ataur Rehman Alvi Trustee 1,63,104 Loan raised on interest 1,50,000 ' Since respondents 1 to 5 have taken up the plea that they have paid only a sum of Rs, 1,50,000 under the sale agreement at the time of execution of the sale agreement and the balance of Rs, 6 lacs was to be paid through instalments from the earnings of the Salt Works, it is not necessary to go into the above question more in detail. However, I may observe that I had enquired from Mr. Ibadat Yar Khan, as to whether the plaintiffs would give adjustment of the above sum of Rs, 5 lacs in case it was in fact paid, his reply was that the plaintiffs would have no objection but he has not made above statement after obtaining instructions as according to him plaintiff No, 2 was admitted to Cardiovascular Centre. Since the case of the plaintiffs is that they wanted to acquire the Salt Works for Tableeghi Trust it is expected of a Tableeghi Trust that it would not like to withhold any amount which was in fact spent on acquiring the Salt Works and would give adjustment of the above amount or any other amount actually spent, if defendant No, 1 will make any claim in respect thereof at the time of settlement of accounts.
(e) It may also be pertinent to mention here that Exh. 15/32 is a cash book maintained by defendant No,
1. According to him it is a daily note book for his personal accounts inter alia contained five entries in the hand of defendant No, 1 debiting Sind Salt Works for a sum of Rs, 4,500 as the amount of interest for each month on Rs, 1,50,00j. Four of the above entries were confronted to defendant No, 1 in his cross-examination. The above five entries are at pages 2, 11, 21, 33 and 45 of Exh. 15/32 which read as follows :-{{TABLE TEXT}}
(1) 21-2-1977
(2) 25-3-1977 8-4-1977 Interest due on 16-2-1977 Rs, 1,50,000, Rs, 4,500 Interest due on 16-3-1977 Rs, 4,500 Interest due on 16-4-1977 Rs, 4,500
(4) 21-5-1977 Interest on Rs, 1,50,000 Rs, 4,500
(5) 18-6-1977 Interest on Rs, 1,50,000 Rs, 4,500 ' P.W. 2 in his statement has stated as follows on the above point : "When I asked Mujibur Rehman to explain the charging of interest at such a high rate from the Alvia Tableeghi Trust, he explained that he had given some black money to Dinshaws and for that he raised some funds i,e, loans and that is why he was charging high interest. I told him that in the type-written statement of accounts which he had given to me the amount of interest was not there. Then he gave me a statement of accounts which is in his handwriting. I produce the same marked as Exh. 15/11. The statement is on both sides of Exh. 15/11. According to the statement given by Mujibur Rehman (Exh. 15/11) the price of the Salt Works became Rs, 12,50,000. The amounts mentioned in Schedule 'A' to the plaint are in accordance with the amount mentioned in (Exh.
15/11)."
' Whereas when defendant No, 1 was confornted with this in the cross-examination, he came out with following statement : "I see entry, dated 21st February, 1977 at page 2, showing payment of interest of Rs, 4,500 on a sum of Rs, 1,50,000. I cannot say to whom this interest was paid. The account books will show, which are in possession of the plaintiffs.
I see page 11, dated 25th March, 1977 showing an entry of Rs, 4,500 as interest. I see page 21, dated 18th April, 1977. It shows payment of interest of Rs, 4,500 I see page 33. There is an entry for payment of interest of Rs, 4,500. All the above entries are in my handwriting. I cannot say to whom these amounts of interest were paid in spite of my long association. Account books will show."
(e) Apart from the fact that Rs, 1,50,000 were not paid out of the sum of Rs, 1,63,651, the bank guarantee for the above sum of Rs, 6 lacs was furnished against the security of the property offered by plaintiff No, 2 and his wife though defendant No, 2's partners gave a counter-guarantee referred to hereinbelow. The above bank guarantee was also arranged by plaintiff No, 2 as indicated by the evidence of P.W. 2 Akhtar Hussain, P. W. 3 Pir M ahfooz and P.W. 4 Aftab Ahmed Khan. However, it was urged by Mr. Liaquat Merchant that the partners of defendant No, 2 had also executed a counter-guarantee Exh. 20/6. In my view the furnishing of a counter-guarantee by defendants Nos. 1 to 5 will not negative the above evidence. The above counter guarantee was for the assets which were purchased under the sale agreement and no personal property was offered by any of the above defendants.
In my view preponderance of evidence on record indicates that the ,C above sum of Rs, 1,50,000 was paid on behalf of the Trust and not by defendant No, 1 in his personal capacity from his personal resources.
(f) It may also be observed that the question, who has paid consideration or to ascertain the source of consideration is a relevant factor for the purpose of determining nature of a transaction of purchase but it is not a conclusive criterion. If an agent after having been instructed by a principal to purchase certain property purchases the same personally, in my view the principal will be entitled to sue the agent for reconvening of the property to him in spite of the fact that the consideration might have been paid by the agent himself provided that at no point of time the principal declined or, failed to provide consideration. In the instant case, it has been proved that defendant No, 1 who was not only.One of the sons of plaintiff No, 2 but was also a Trustee of plaintiff No, 1 Trust and was also managing the Sind Salt Works, which belongs to the Trust, was authorised to purchase the Salt works on behalf of the Trust and, therefore, even if defendant No, 1 has paid, some amounts from his personal resources or other resources as a part of consideration, he shall be entitled to be reimbursed from the Trust but cannot become the owner of the Salt Works.
(g) It was also urged by Mr. Liaquat Merchant that Exhs. 15/9 & 15/10 i. e. Draft of the deed of dissolution and the fair typed deed of dissolution on Rs, 20 stamp paper belies the case of the Trust inasmuch as under the above documents the partners of Habib Ocean Industries were to be substituted by plaintiff No, 2 and his sons and not by the Trust. It is true that under the above two documents. The partners of defendant No, 2 were to be substituted by the names furnished by plaintiff No, 2 but it cannot be overlooked that the reason that the Parsi vendor might not like to sell the Salt Works to a Muslim Tableeghi Trust given by P.W. 2 Dr. Alvi and P.W. 3 Akhtar Hussain was very much there at the time of the preparation of the above two documents. It may again be pointed out that as per written statements of defendants 1 to 7, the full consideration was not paid by June/July, 1977. Even otherwise, the above substituted partners would have been holding for the benefit of the Trust.
5. (a) Referring to the third point i. e. The conduct of the parties, it may be observed that Mr. Ibadat Yar Khan has invited my attention to the documents, which show that after the purchase of the Salt Works, the same was managed from the same office, the sales of the salt manufactured by the Salt Works were effected by the Sind Salt Works, the salaries of the staff of Sind Salt Works and the Salt works in question were paid from the account of Sind Salt Works. In this regard a reference may be made to Exhs. 15/26, 15/27 and 15/28, which are the copies of the bills indicating that common bills were used for the sale of salt manufactured by Sind Salt Works and by the Salt Works in question Exhs. 15/29, 15/30 and 15/31 are the receipts issued by Sind Salt works for the payments of the bills- made by the customers, which co-relate with the above bills. This position has been admitted by defendant No, 1 in his cross-examination in detail. It may also be observed that Exh.
15/33 relates to counterfoils of cheque book bearing Nos. B-077976 to B-078000 issued in respect of account No, 7767 pertaining to Sind Salt Works issued by Bank of Bahawalpur. It may be mentioned that counterfoil of cheque No, B-077984, dated 5th March, 1977 contains the initial of defendant No, 1, which shows a sum of Rs, 13,917 was drawn for salary etc. Counter-foil of cheque No, B-077985, dated 4th May, 1977 for a sum of Rs, 21,600 on account of salary etc. (for 4/77) was drawn. Chaque No, 077989, dated 2nd June, 1977 was drawn for a sum of Rs, 14,490 for a salary (for 5/77) and other expenses. It may also be mentioned that Exh. 15/33 the cash book (which according to defendant No, 1 is a note book) contained the details of the payment of salaries to the staff of Sind Salt Works, Habib Ocean Industries and to the staff at the office at Zeenat Mansion. Defendant No, 1 in his deposition has admitted this position that the salaries were paid from this account as follows "It is correct that to pay the salary Rs, 13,917 were drawn from the National Bank. It is correct that Exh.
15/33 contains counterfoil of the cheque by which the amount of Rs, 13,917 is drawn. I see counterfoil of another cheque, dateh 4th May, 1977 for Rs, 21,600. This amount is shown at page 27 of Exh. 15/32.
' I see the counterfoil of the cheque, dated 2nd June, 1977 for Rs, 14,490. This amount was drawn from the Bank for payment of salary and other expenses. I cannot give break-up of this amount as to how much was paid and to whom.
' I see Exh. 18/32 page 6. There are three amounts at the top i. e. Rs, 2,700.50 salary Landhi, Rs, 8,867 salary Mauripur, Rs, 2,350 salary office. It is correct that the total of all these three amounts comes to Rs, 13,917.50.
' I see Exh. 15/32, page 27, entry, dated 4th May, 1977. It is stated there in "pay Landhi Rs, 2,975 salary, Mauripur Rs, 8,400, pay office Rs, 2,455, pay Asrar (pay) (balance Rs, 1,000 February, Rs, 1,000 March)=Rs, 30,000" Mujeeb (pay) Rs, 9,500)=Rs, 3,000 "Total of the above amounts comes to Rs, 19830.
' I see Exh. 15/32, page 37, dated 2nd June; 1977. It shows Rs, 6,000 was paid "Pay Landhi and office"
Rs, 8,400 as "pay Habib". The entries are in my handwriting. By "Habib" it is meant "Habib Ocean Industries". Habib Ocean Industries is situated at Mauripur. It is correct that the total of these items if Rs, 14,490 I see page 77 of the same book, dated 8th March, 1977. It states "Asrar (Pay A/C) Rs, 2,000". It .Is not correct that this amount was paid to Asrar on account of his pay. This amount was paid to Asrar to pay the pay of other persons, and as his own pay. There is account of other persons but it is with the Martial Law Authorities."
' However, it was contended by Mr. Liaquat Merchant that in fact the Salt works was selling its salt through Sind Salt works, which used to pay the price. Defendant No, I has not produced any account books on the plea that the same were with the Martial Law Authorities in connection with a case for the alleged evasion of the excise duty. Defendant No, 1 has not even attempted to summon the above account books. Mere words of defendant No, 1 without any document cannot be accepted. The plaintiffs' above documentary evidence referred to hereinabove could have been dislodged by some convincing evidence from the side of defendants Nos. 1 to 5, which is wanting.
6. For the aforesaid reasons, my finding on above issue 3 is that their Salt Works was purchased at the behest of the plaintiffs Nos. 1 and 2 for the'. Benefit of the Trust.
7. (a) As regards issues Nos. 1 and 4, it may be observed that it has been vehemently urged by Mr. Liaquat Merchant that the plaintiffs are not entitled to reliefs prayed for inasmuch as the declaration of the nature sought is not covered by section 42. Injunction or the relief for possession cannot be granted as rectification of the sale agreement has not been claimed. However, he concedes that the relief for accounts can be granted, in case the plaintiffs succeed. In support of his above contention, he has referred to section 42 of the Specific Relief Act, which reads as follows.: - "42. Discretion of Court as to declaration of status or right. -Any person entitled to any legal character, or to any right as to any property, may institute a suit against any person denying, or interested to deny, his title to such character or right and the Court may in its discretion make therein a declaration that he is so entitled, and the plaintiff need not in such suit ask for any further relief.
' Bar to such declaration.-Provided that no Court shall make any such declaration where the plaintiff, being able to seek further relief then mere declaration of title, omits to do so.
' Explanation.-A trustee of property is a "person interested to deny" a title adverse to the title of someone who is not in existence, and for whom, if in existence, he would be a trustee."
It may be noticed that any person entitled to any legal character or to any right as to any property may institute a suit against any person denying or interested to deny his title to such character or right and the Court has discretion to make such declaration. In the instant case the plaintiffs are seeking declaration as to the Trust right to the suit property and, therefore, it falls within the ambit of the above section. The case of Alvi Sons Ltd. v. The Government of East Pakistan and others (1) relied upon by Mr. Liaquat Merchant has no application to the instant case. In the said Karachi case a learned Single Judge held that the plaintiffs were not entitled to seek declaration that they had not committed any breach of the agreement and that the security in the form of a bank guarantee to the extent of Rs, 66,000 was not liable to be encashed by defendant No, 1 from the bank. It was also held that the relief of injunction for restraining the bank from encashing the bank guarantee was not sustainable. The facts of the above case are quite distinguishable from the present case.
In the instant case as observed the plaintiffs are claiming declaration to the Trust right in respect of the suit property.
(b) Referring to his second submission that since the plaintiffs have not claimed rectification of the sale agreement Exh. 8, they are not entitled to claim injunction or a direction to give possession or to claim possession of the suit property. It may be observed that Mr. Liaquat Merchant has referred to sections 22, 23, 31, 39, 54 and 56 of the Specific Relief Act. In my view sections 22 and 23, which relate to the specific performance of an agreement have no application to interest case. The plaintiffs are not seeking specific performance of an agreement but are seeing declaration that the suit Salt Works was purchased for the benefit of the Trust and as a consequential relief they have claimed possession nor they are claiming rectification or cancellation of the sale agreement as to attract section 31 or 39 of the Specific Relief Act. I am also inclined to hold that sections 54 and 56 are also not applicable as factually plaintiffs are not claiming perpetual injunction but in substance they are claiming possession of the suit Salt Work which relief is consequential to the relief of declaration as observed hereinabove.
(1) PLD 1968 Kar. 222 It may be observed that so long as a relief arises out of pleadings and falls within the four corners of the controversies in issue between the parties the Court is competent to grant appropriate relief or reliefs in addition or in substitution of a relief or reliefs prayed for.
8. (a) It was urged by Mr. Muhammad Hanif learned counsel for defendants 6 and 7 that no relief can be granted against the above defendants as they were not parties to any arrangement arrived at between the plaintiffs and defendant No, 1 and that the plaintiffs are strangers as far as the above defendants are concerned. In my view since it was not within the knowledge of the defendants Nos. 6 and 7 that defendant No, 1 was purchasing on behalf of the Trust, no relief can be granted against the above defendants on the basis of Exh.
8. However, defendants. Nos. 1 to 5 can be compelled to do all acts which are necessary for fully vesting the suit property in the Trust.
(b) He has also urged that factually defendants Nos. 1 to 5 had paid a total sum of Rs, 7,50,000 to the above defendants Nos. 6 and 7 and not Rs, 12,50,000. It will suffice to observe that from the evidence on record, particularly from aforesaid Exh. 15/11, it is indicated that defendant No, 1 had informed plaintiff No, 2 that he had also paid Rs, 5 lacs to the above defendants in addition to the amount reflected in the sale agreement. Defendant No, 1's above assertion made to plaintiff No, 2 (though defendant No, 1 has denied before this Court) gets support from the fact that leaving apart the value of structures and machinery; the value of 8 lacs maunds of salt which was part of the sale transaction given by defendant No, 1 in his deposition is Rs, 10 lacs. However, nothing has been brought on record to prove that actually above sum of 5 lacs was paid to defendants Nos. 6 and 7.
(c) Mr. Chandio Advocate for defendant No, 8 supported the arguments of Mr. Liaquat Merchant and pointed out that above defendant was impleaded as plaintiff without his consent, but at his request he was transposed as defendant No, 8.
9. For the aforesaid reasons, I decree the suit and declare that the suit Salt Works was purchased for the benefit of plaintiff No, 1 Trust and the latter is in fact the owner of the suit Salt Works. I further decree the relief for possession and also direct defendants Nos. 1 to 5 to hand over all documents and to execute all deeds and documents for ensuring the title of the Trust in respect of the suit Salt Works.
' I further pass a preliminary decree for accounts and appoint Mr. A. A. Dareshani, Advocate as the Commissioner for the purpose of taking accounts in order to settle accounts between plaintiff and defendants Nos. 1 to 5 and fix his tentative fee Rs, 5,000 to be deposited by the plaintiffs with the Nazir of this Court, which amount the Commissioner may withdraw. I may observe that according to P. W. 2 Dr. Alvi he was paying a sum of Rs, 5,000 per month plus car and house to defendant No, 1 for running the Trust factory, namely, Sind Salt Works and managing the Trust property. The Commissioner shall be entitled to award reasonable amount as the remuneration to defendant No, 1 for running the Salt Works in dispute in addition to reimbursement of the various amounts spent on purchasing the Salt Works and the amounts which he might have incurred in putting the Salt Works into operation which was admittedly closed for a number of years before it was sold. The Commissioner shall submit his report within 3 months from the receipt of intimation from this Court.
' The decree for possession is stayed for a period of 60 days in order to enable the defendants to file an appeal and to obtain a stay order in case they wish so. The Receiver shall stand discharged on handing over of the possession to the plaintiffs in execution of the above decree for possession.