ORDER
(1) C.MA. No,3436 of 1991.
1. ' This application has been filed by the plaintiff under Order 39, Rules 1 and 2 read with Section 151, C.P.C. For injunction restraining the defendants from selling, disposing of or otherwise removing 7,200 bags of cotton seeds oil cakes lying at different godowns mentioned in the application till disposal of the suit and alternatively, has prayed for directions to the defendants to hand over the same to the plaintiff.
2. ' Briefly, the facts as disclosed in the plaint are that the plaintiff purchased 154 delivery orders of cotton seeds oil cakes (hereinafter referred to as the goods) from Karachi Grains & Seeds Merchants who is arrayed as Defendant No,1, through Defendant No,2, who is a Broker between 5-7- 1991 and 15-7-1991 according to the practice for buying the said goods. The full amount towards the consideration of the above delivery orders was paid to Defendant No,1, through pay orders and bank drafts through Defendant No,2. The copies of the aforesaid pay orders and bank drafts were produced as Annexures B/1 to B/3 to the plaint. According to the plaintiff, he had received the said goods against 82 delivery orders up to 25-7-1991 from the godowns of Defendant No,1, but thereafter the Godown Incharge on instructions of the defendants refused to hand over the goods against the remaining 72 delivery orders. The Plaintiff therefore, contacted the defendants who failed to give satisfactory reply for withholding the goods. It was alleged that Defendant No,1, also failed to take any action under its Bye-Laws. On 26-7-1991, the Plaintiff came across an advertisement in daily 'Dawn' in which the Defendant No,2 disclosed the loss of 130 delivery orders on 24-7-1991 and finder was asked to contact Defendant No,2.
3. ' It is the case of the Plaintiff that he is the owner of the goods, subject-matter of the aforesaid delivery orders, having purchased the same on making full payment to Defendant No,1, and is legally entitled to the delivery thereof. It is stated that the Plaintiff has contracted onward sale of the above goods at the rate of Rs,140 per bag in the market and because of non-delivery of goods to him, he was facing problems. He served notice on the defendants but they have failed to deliver the goods. The Plaintiff has sought the following reliefs in the plaint:--
(a) direct the defendants to deliver the goods to the plaintiff i.e, cotton seeds oil cakes against 72 delivery orders;
(b) declare that the plaintiff is lawful owner of the goods i.e, subject-matter of this suit and the defendants may be directed to specifically perform in respect of the abovesaid delivery orders;
(c) grant costs of the suit to the plaintiff;
(d) injunction restraining the defendants from disposing of the said goods;
(e) grant any other relief/reliefs in favour of the plaintiff and against the defendants in the circumstances of this case.
4. ' Alternatively,
(a) decree the suit for Rs,10,00,000 being the value of the goods i.e, 7200 bags of cotton seeds oil cakes to be delivered by the defendants to the plaintiff against 72 delivery orders;
(b) grant decree for Rs,2,00,000 as compensation for illegal retention of goods in question;
(c) grant decree for Rs,28,800 being loss of profit of sale of bags being difference of price of sale of each bag in the market; This Hon'ble Court may grant any other relief as deems fit in the circumstances of this case.
5. ' The defendants filed their respective counter-affidavits. The Defendant No,1, in reply to the counter-affidavit of Defendant No,2, filed its Rejoinder. The Plaintiff filed his affidavit-in-rejoinder containing the reply to the counter-affidavits and affidavit-in-rejoinder filed by Defendant No,1.
6. Briefly, the case of Defendant No,2, is that in May, 1991 the Plaintiff had entered into a ready contract with him for purchase of 3,190 bags and he took the delivery thereof from its godown known as Raja Godown. In June, 1991, the Plaintiff entered into another forward contract with him and was liable to pay Rs,2,50,000 to him which amount was outstanding against the Plaintiff. In July, 1991 Defendant No,2, purchased 15,400 bags of July Contract which he sold to the Plaintiff. Out of the said contract, 3,100 bags were sold to the Plaintiff at the rate of Rs,146 per bag and 12,300 bags at the rate of Rs,140 per bag. The Plaintiff failed to pay the total amount of Rs,21,74,600 against the above contract apart from the sum of Rs,4,55,687 and Rs,2,50,000 which he was liable to pay on account of May and June. Contracts. However, the Plaintiff made payment of only Rs,18,45,680 out of the total amount of Rs,28,80,287. The Defendant No,2, has stated that the Plaintiff also had to pay Rs,3,14,660 to him which amount was paid by Defendant No,2 to Defendant No,1 under coercion on account of storage charges. Thus the Plaintiff is liable to pay a sum of Rs,13,49,267 to Defendant No,2. It is contended that the Defendant No,1 is in league and collusion with the Plaintiff. It is stated that neither there is privity of contract between the Plaintiff and the Defendant No,1, nor the Plaintiff can directly purchase the goods from the said defendant as he is not the member thereof. It is the case of Defendant No,2 that the delivery orders of 13,900 bags were misplaced and lost and, therefore, to safeguard his interest, he had reported the matter to the Police as well as to Defendant No,1. He also got published a public notice in daily 'Dawn' about the loss of the delivery orders.
7. ' Defendant No,2 has pleaded that due to mala fides on the part 'of the Plaintiff not only he had suffered but the entire business community had to face hardships as the market remained closed for about one week. Defendant No,2 has also detailed the procedure with regard to the transaction carried out in sale and purchase of the goods in question. According to the details given by him with regard to the practice and procedure of the market, it is stated that on purchase of the said goods, he can take physical delivery thereof or sell the delivery orders to any other person. If he sells the delivery orders, they are to be signed by him. The Purchaser will then take the delivery orders to Defendant No,1, who will thereafter send the delivery orders back to him for verification, signature and confirmation and after confirmation by him and on his signing the delivery orders, Defendant No,1, will release the goods.
8. ' It is contended that the Plaintiff having claimed damages in his notice dated 27-7-1991 and so also in the suit, is not entitled to the grant of injunction. The suit has been termed as misconceived, as no decree can be granted for specific performance of the contract in respect of the goods. The Plaintiff is not likely to suffer any irreparable loss. It is pleaded that the goods are perishable and its utility will be decreased day by day, which will decrease the price thereof and the prices are further liable to be decreased as next cotton season is close at hand. The Plaintiff as well as Defendant No, 2, have filed several documents alongwith the plaint, the counter-affidavit and affidavit-inrejoinder respectively.
9. ' I have heard Mr. Suleman Kassim for the Plaintiff, Mr. Haji Haroon for Defendant No,1, and Mr. Muhammad Ali Sayeed for Defendant No,2.
10. ' The learned counsel for the Plaintiff has contended that Defendant No,1 in his counter-affidavit has admitted that the entire payment towards the price of the contracted goods has been made to it by the Plaintiff. For the said purpose, he has relied on Annexures B/1, B/2 & B/3 to the plaint. He has also referred to the documents filed by the Plaintiff alongwith his rejoinder as P/III-A to P/VI. It is urged by him that the contract has been partly acted upon by the defendants and in case any amount is payable by the plaintiff to Defendant No,2, he can recover the same through process of law but cannot retain the goods in question or refuse the delivery thereof to the plaintiff. Relying on section 58 of the Sale of Goods Act, it is urged that the plaintiff is entitled to recover the goods and the contract for supply thereof is capable of being specifically enforced.
11. ' He submitted that the plaintiff has established good prima facie case and in case the injunction is refused he will suffer irreparable losses. The damages are claimed in alternate only by way of abundant caution, so that the plaintiff is not left without any relief.
12. ' He lastly contended that even if there be any bar in granting injunction under Order 39, Rules 1 and 2, C.P.C. This Court has the powers to grant the relief to the Plaintiff under Sections 151 and 94, C.P.C.
13. ' He has relied on the following cases:--
(i) 1989 CLC 2178 (Major (Retd.) Sheikh A. Naeem v. Lt.-Col Asif Burhan Malik and others);
(ii) 1988 MLD 1734 (Chaudhry Brothers v. Province of Punjab and others);
(iii) 1989 MLD 920 (Fida Ahmed and others v. Amir Masood Khan and others);
(iv) 1990 CLC 609 (Molasses Export Company Ltd. v. Consolidated Sugar Mills Ltd.);
(v) PLD 1990 Kar. 1 (Balagam Wala Oil Mills Ltd. v. Shakarchi Trading A.G. And others).
(1) Mr. Muhammad Ali Sayeed relying on Sections 10, 11, 12 and 21 of the Specific Relief Act, contended that the contract entered into between the parties cannot be specifically enforced.
(2) The contracted goods are perishable commodity and in case the injunction is granted, the Defendant No,2, will suffer irreparable losses.
(3) The plaint does not disclose prima facie case. On the showing of the plaint itself, the Plaintiff has paid only a sum of Rs,18,42,680 as against the total liability of Rs,28,80,287 plus Rs,3,14,660.
(4) The Plaintiff is not entitled to the grant of injunction as he has valued the damages in terms of money and as such it cannot be said that any irreparable loss will be caused to the Plaintiff in case of refusal of injunction as prayed for, the damages claimed being adequate relief in case the Plaintiff succeeds to establish his case.
(5) The balance of convenience is in favour of Defendant No,2, and not the Plaintiff.
14. ' In essence, the entire dispute revolves on the non-payment of entire sale consideration by the Plaintiff. The Plaintiff instead of disclosing the contracted price of the goods purchased by him in straightforward manner, by mentioning the figure thereof, has stated in the plaint that he had purchased 154 delivery orders from Defendant No,1 through Defendant No,2 and made payment thereof to Defendant No,1 through Defendant No,2, under Annexures B/1 to B/3 to the Plaint. The above annexures are in the sum of Rs,3,42,680, Rs,12,00,000 and Rs,3,00,000 respectively. The total amount thereof works out to Rs,18,42,680.
15. ' Thus the case reflected in the plaint is that 154 delivery orders were of the total value of Rs,18,42,680. When the details of the price contracted was disclosed by Defendant No,2 in his counter-affidavit to be Rs,21,74,600, the Plaintiff in his affidavit-in-rejoinder conceded to the fact that the total price as disclosed by Defendant No,2, was correct, but however, he took up the stand that he had made all the payments and for the said purpose, he relied on Annexures P/III-A to P/VI to the said rejoinder. Annexures P/III-A, P/IV, P/V, & P/VI are debit vouchers whereas PAH is a cheque. The said annexures represent total amount of Rs,3,25,000. These documents do not show either of the defendants as recipient of the said amount. The Plaintiff has thus failed to establish the payment of the entire sale consideration. Defendant No,2 appears to have a plausible case and the Plaintiff has failed to show that he has a prima facie case for exercise of discretion in his favour for grant of injunction or the direction sought against the defendant for delivery of the goods.
16. ' The learned counsel for the Plaintiff in support of his contention that the Plaintiff would suffer irreparable losses in case the injunction is refused has referred to the case-law mentioned hereinabove. In so far as the case of Fida Ahmed and others is concerned, it pertains to specific performance in respect of immovable property.
17. ' The case of Major (Rtd.) Shaikh Naeem is with regard to injunction sought restraining the defendant from raising construction. The learned counsel for the plaintiff has relied on the observations made in the case to the effect that the alternate remedy by way of damages in the suit for specific performance of contract does not as a rule deprive the Plaintiff to seek interlocutory injunction, as such alternative relief is claimed only with a view to meet the situation where the Court may refuse specific performance in its discretion so that Plaintiff is not left without any relief, though such relief cannot be treated to be equivalent of claim of damages by a Plaintiff, in lieu of specific performance. In the above case accordingly interlocutory relief by way of injunction was granted by a learned single Judge of this Court.
18. ' The case of Haji Sher Muhammad relates to the grant of interlocutory mandatory injunction against WAPDA for restoration of electric supply to the industry of the Plaintiff, which was disconnected without following the mandatory provisions of the Electricity Act, 1910. While granting the injunction, it was observed by the learned single Judge of the Lahore High Court, that after restoration of electricity, fresh' orders may be passed by proceeding against the Applicant in accordance with the provisions of the said Act.
19. ' The case of Chaudhry Brothers pertains to an injunction sought against the alleged over- payments made by the defendants to the Plaintiff. The Plaintiff had established from the record of the defendants that prima facie no amount was due towards him. Under such circumstances, the injunction was granted.
20. The case of Balagam Wala Oil Mills Ltd. Pertains to Mareva injunction where the view was express injunction can be granted within the four corners of the case so demand that to foster the cause of justice, interlocutory in a fit case even if the case does not fall A Order 39, Rules 1 and 2, C.P.C., if the facts of.
21. ' There can be no cavil with regard to the propositions of law that have been laid down in the above cases. The essence of the law is that Court can exercise its inherent jurisdiction to grant interlocutory relief by way of injunction if a strong prima facie case is established and refusal of injunction would defeat the ends of justice, even if the injunction sought is not covered by the specific provisions of the Code of Civil Procedure, but such a relief can be granted only if it is so warranted by the facts of the case. The quintessence is that the Plaintiff has established such a case where equity is on his side coupled with strong prima facie case.
22. ' The learned counsel for the Plaintiff has laid great emphasis on the case of Molasses Export Co.
23. Ltd. v. Consolidated Sugar Mills.
24. ' In the above reported case, the Plaintiff had sought directions against the defendants for delivery of Molasses by the defendants, as purchaser thereof. The question that required consideration was whether the Plaintiff would suffer any irreparable loss or injury in case the interlocutory orders as prayed for, were not granted. The case of the Plaintiffs was that the contracted goods/Mollases were not available and in any case were not readily available in the market and that the Plaintiff was committed to sell and export all the goods which were subject-matter of the contract to foreign buyers and that in case breach of the contracts took place due to non-performance on its part, the Plaintiff would lose not only the credibility with the foreign buyers but would also lose foreign market business relating to the sale of Molasses which was its only business and under these circumstances, it was urged that in case of refusal of injunction, the Plaintiff would suffer irreparable losses. The defence set up in the case was that the contract in the suit being for the sale of goods, their specific performance could not be argued and that the Sugar Mills in Pakistan produced huge quantities of Molasses and the Plaintiff could make purchase thereof in the local market and claim damages from the defendant.
25. ' The learned Judge after referring to the case-law on the subject and the facts of the .Case reached the conclusion that the Plaintiff had established strong prima facie case in its favour. The plaintiff had entered into contract with the foreign purchasers for the supply of molasses during particular sugarcane season and the supply was to be completed by exporting the goods within specified period and in case it was not done by the Plaintiff, the Plaintiff will suffer irreparable losses as in case of breach of the contracts took place due to nonperformance on its part, the Plaintiff shall lose not only the credibility with the foreign buyers but shall also lose foreign market business relating to sale of molasses which was its only business. The learned Judge also reached the conclusion that there was no alternative source for obtaining the molasses except the defendant Mills with whom the contract was entered into. As a consequence it was observed that in case the injunction is refused, it will amount to throwing the Plaintiff out from the international market and under such circumstances, the damages would be poor consolation for the Plaintiffs. The learned Judge further found that the Plaintiffs had on the one hand given huge advances to the defendant Mill and on the other hand had stood guarantee for exceedingly huge amount for the defendants for supply of machinery required for its Sugar Mills, and the said machinery was obtained by the defendants on the basis of such guarantee which continued to be operative during the pendency of the suit also and all this was done by the Plaintiffs only with a view to purchase molasses from the defendants for onwards sale/export to the foreign buyers to whom it was committed and the non-supply thereof to the Plaintiff would lead to serious consequences and the plaintiff would suffer irreparable losses by losing foreign buyers and its credibility in the foreign market.
26. The principle of availability of satisfactory equivalent is by now almost a settled principle of law.
27. There is no gainsaying that damages are obviously an adequate remedy where the Plaintiff can get a satisfactory equivalent of what he contracted for from some other source. It is for such reason that specific performance is not generally ordered in the cases of contracts for the sale of commodities, or of shares, which are readily available in the market for the reason that the Plaintiff can buy the substitute in the market and can be adequately compensated by recovering the difference between the contract price and the market price, by way of damages and such damages can be claimed only if the substitute has been purchased and consequently, loss has been suffered.
28. ' Section 10 of the Specific Relief Act lays down that a person entitled to the possession of specific movable property may recover the same in the manner prescribed by the Code of Civil Procedure.
29. Section 11 of the said Act provides for recovery of possession of a particular article of movable property: Clause (b) thereof lays down that one may so recover such property when compensation in terms of money would not afford the claimant adequate relief for the loss of the thing claimed.
30. Section 57 of the Sale of Goods Act, provides that subject to the' provisions of Chapter II of the Specific Relief Act, 1877, in any suit for breach of contract to deliver specific or ascertained goods, the Court may, if it thinks fit, on the application of the Plaintiff by decree direct that the contract shall be performed specifically. Section 21(a) provides that the contract cannot be specifically enforced for non-performance of which compensation in money is an adequate relief.
31. ' Section 56, Clause (a) provides that an injunction cannot be granted to prevent the breach of contract, the performance of which would not be specifically enforced and under Clause (i) thereof when equally efficacious relief can certainly be obtained by any other usual mode of proceedings except in case of breach of trust. From the above scheme of law it is obvious that a contract cannot be specifically enforced when the contracted goods are not specific or ascertained or substitute thereof can be obtained from the market. Under such circumstances compensation in terms of money is adequate or efficacious remedy. As already observed above, the goods in question are not such, substitute whereof could not be found or that they are of some peculiar value for him It is not the case of the Plaintiff that the goods contracted for by him are not articles of commerce and are not readily available in the market. On the contrary, the grievance of the Plaintiff as is reflected in the prayer clause specifically states that he would suffer a loss of Rs,28,800 being the loss of profit on sale of bags due to difference of price of each bag in the market and thereby has suggested that if he purchased the said goods from the market, he would pay extra amount in the above sum for purchase of the goods. The above assertion on his part, demonstrates the fact that the contracted goods are available in the market but at a price higher than, he has sold the same in advance and on which rate he has to supply the goods to his customers.
32. ' In the case of Molasses Export Company Ltd., it was specifically found by the Court that the substitute thereof was not available in the market and it was further found that the products of particular reason were to be exported by the Plaintiff within the specified time. Such situation is not obtaining in the present case. It, therefore, can be said without any hesitation that the satisfactory equivalent in the market being available, the Plaintiff cannot press the rule laid down in the case of Molasses Export Company Limited, for grant of injunction in his favour.
33. ' Mr. Muhammad Ali Sayeed, the learned counsel for defendant No,2 has stressed the point that the plaintiff has not come to Court with clean hands and as such he cannot be granted equitable relief. He has further submitted that out of the amount received by defendant No,2 under Annexures B/1, B/2 and B/3 to the plaint, the earlier dues outstanding against the plaintiff have been adjusted and even otherwise the plaintiff cannot seek relief without offering to pay the amount of Rs,13,49,267.00 as has been noted above. In the plaint the total consideration for the contract was disclosed to be 18,45,680 although to the knowledge of the plaintiff, it was more than that which fact he conceded in his affidavit in rejoinder but at the same time alleged the payment of entire sale consideration under the documents filed with the rejoinder which prima facie do not disclose any payment to the defendants or any of them. The plaintiff being guilty of misrepresentation of facts is not entitled to grant of equitable relief of injunction.
34. ' Under the circumstances of the case the balance of convenience is also in favour of defendant No,2. The discretion, therefore, cannot be exercised in favour of plaintiff either under Order 39, Rules 1 and 2, C.P.C. Or Section 151, C.P.C, or Section 94, C.P.C.
35. ' The application is, therefore, dismissed with no order as to costs.
36. ' However, whatever has been observed above is tentative in nature and should not reflect on the final disposal of the suit.
2. C.MA. No,3864 of 1991 The learned advocate has relied on the admission made by Defendant No,1 in its counter-affidavit with regard to receipt of the amount towards sale price and has, therefore, sought a decree against the defendants. On the said admission suit cannot be decreed for the following reasons: ' Firstly the admission of Defendant No,1 cannot bind Defendant No,2. Secondly the admission made by Defendant No,1 was mistake of fact which has been rectified by it in subsequent affidavit. Thirdly the property in the goods belongs to Defendant No,2 and not to Defendant No,1. The dispute raised in the suit by the plaintiff requires proof for verdict in his favour. The above admission cannot be treated as conclusive proof of the matter allegedly admitted by Defendant No,1 which does not constitute estoppel by itself. Prima facie there is no privity of contract between the Plaintiff and Defendant No,1.
37. ' The application is, therefore, dismissed being misconceived.