1. The plaintiff in this application, which is supported by the affidavit of Haji Hasham Ahmed son of Haji Ahmed, the Chief Executive of the plaintiff-Company, has prayed for the following reliefs:-
(a) That the defendants may be restrained from operating Thatta Sugar Mill and/or carrying on any activity in relation to production of sugar mollasses and alcohol; and
(b) restraining the defendants from sale or otherwise disposing of or removing any stock of finished or half-finished products of sugar, mollasses and alcohol from the premises of Thatta Sugar Mills.
The relevant facts as disclosed in the affidavit are as under:- "5. That Thatta Sugar Mill was sold to the plaintiff-Company and possession thereof handed over to the plaintiff on 14-11-1992 on 'as is where is' basis along with all the machinery and spare parts lying therein as well as the stocks of sugar, mollasses and alcohol available on the mill premises on the date of take-over.
6. That the plaintiff-Company has already paid a sum of Rs,58,353,067 (Fifty-eight million three fifty-three thousand and sixty-seven rupees) to the defendant as per agreed terms, the details of which have been disclosed in paragraph 35 of the plaint.
7. That the plaintiff also put up a totally separate and new mill along with a Centrifugal Machine and purchased spare parts, the total of which comes to Rs,57 lacs and they belong exclusively to the plaintiff.
8. That during the period the mill was under control and management of the plaintiff, the plaintiff sustained an operational loss of Rs,1 crore 20 lacs.
10. That the defendants are likely to start the operation of the mill which belongs to the plaintiff.
11. The defendants are intending to sell the stocks of sugar, molasses and alcohol belonging to the plaintiff and they have invited Gallop Tender for the sale of Alcohol, sugar and molasses vide Gallop Tender Notice published to daily The News" of 19-9-1994, "Dawn, of 20-9-1994 and "Business Recorder" of 19-9-1944."
' Photostat of the two Tender Notices are filed herewith as Annex. "M" & "M-1".
12. That the plaintiff had completed its part of the duties and obligation as fixed by the defendants under the Memorandum of Understanding, dated 11th November, 1992, paying all the dues and providing all the guarantees and nothing remained to be done by the plaintiff towards formal execution of the sale-deed which had to be prepared by the defendants themselves. The defendants however had put the plaintiff in possession of the mill and the stocks in part performance of the contract and subsequently without assigning any reason illegally took over the possession of the same.
13. That has submitted above the entire property now vests in the plaintiff and the defendants have no authority in law to either manage, run or operate the mill or to sell the stocks belonging to the plaintiff. Hence the accompanying, application.
14. That in case the accompanying application is not granted, the plaintiff shall be seriously prejudiced as the plaintiff would be deprived of its properties if they are sold and would suffer irreparable loss if mill is allowed to be operated by the defendants as in that case there is serious apprehension that the mill itself may be misused or damages."
2. Mr. A.H. Lakho, learned counsel for the plaintiff, has contended that (i) Thatta Sugar Mill was sold to the plaintiff and possession thereof was handed over to the plaintiff on 14-11-1992 on "as is where is" basis alongwith all the machinery and stocks of sugar, mollasses and alcohol available on the mill premises on the date of taking over; (ii) that the plaintift-Company has already paid a sum of Rs,58,353.067 (fifty-eight million, three fifty-three thousand and sixty-seven rupees) to the defendants as per agreed terms; (iii) that the plaintiff also put up a totally separate and new mill alongwith a Centrifugal machine and purchased spare parts, the total of which comes to Rs,57 lacs belongs exclusively to the plaintiff; (iv) that during the period of management and control of the plaintiff, sugar, mollasses and alcohol were produced and on the date when the defendant illegally took over the possession of mill, the said stock of sugar, mollasses and alcohol was worth Rs,13,659,864 as per Stock Register, the original of which was maintained at the mill and which was also illegally taken into possession by the defendants; (v) that the defendants are likely to sell the stocks of sugar, mollasses and alcohol belonging to the plaintiff and they have invited tender for the sale of sugar, mollasses and alcohol; (vi) that the plaintiff had completed its part of the duties and obligations as fixed by the defendants under the Memorandum of Understanding dated 11-11- 1992 by paying all the dues and providing all the guarantees and nothing remained to be done by the plaintiff towards formal execution of the sale-deed which had to be prepared by the defendants themselves. The defendants, however, had put the plaintiff in possession of the mill and the stock in part performance of the contract and subsequently without assigning any reason illegally taken over the possession of the same; (vii) that the entire property now vests in the plaintiff and the defendants have no authority in law to manage, run or operate the mill or to sell the stocks belonging to the plaintiff; (viii) and that if the application is not granted the plaintiff shall be seriously prejudiced as the plaintiff would be deprived of its properties if they are sold and would suffer irreparable loss if mill is allowed to be operated by the defendants as in that case there is serious apprehension that the mill itself may be misused or damaged. Mr. Lakho has also contended that in view of the Memorandum of Understanding possession of the mill was handed over by the defendants to the plaintiff.
3. In support of the above contention Mr. Lakho has cited following authorities:-
(1) 1981 CLC 276--Case of Anjum Rehmat v. Shaikh Ghulam Sadiq;
(2) 1988 SCMR 1623--Case of Haji Nawab Din v. Sh. Ghulam Haider;
(3) 1976 SCMR 379--Case of Syed Yaqub Hussain Naqvi v. The Settlement Commissioner and others;
(4) PLD 1989 Lahore 152--Case of Mian Zafar Iqbal v. Bashir Ahmed;
(5) 1973 SCMR 225 relevant at page 227--Case of Abdul Karim v. Muhammad Shafi;
(6) 1987 MLD 295--Case of Jamal Ahmed v. Zakaria;
(7) 1992 SCMR 1265--Case of Naib-Subedar Taj Muhammad v. Yar Muhammad Khan; and
(8) PLD 1977 Karachi 21 relevant page 23--Case of Muhammad Azam Muhammad Fazil and Co., Karachi v. Messrs N.A. Industries, Karachi.
4. I have heard Mr. Khalid M. Ishaque, learned counsel for defendant No, 1 and Mr. Qurban Ali Chohan, A.-G., Sindh alongwith Mr. K.M. Nadeem, A.A.-G., Sindh for defendants Nos. 2 and 3. All of them have opposed this application and there is also a counter-affidavit of Habib Ahmed Khan, son of Chaudhry Jan Muhammad, the Manager, Corporate Affairs of the defendant No,
1. The relevant paragraphs of the affidavit are reproduced as under:- "6. That the contents of para. 5 of the affidavit are denied. Thatta Sugar Mill was never sold to the plaintiff. The plaintiff was merely given the management of the Mill pursuant to the Memorandum of Understanding dated 11-11-1992. As stated above, the parties failed to reach an agreement, and thus there was not even a valid, concluded, or binding contract between the parties for the sale of TSM.
10. That with respect to the contents of para. 10 of the affidavit, it is specifically denied that the TSM belongs to the plaintiff. The ownership of and property in the TSM still vests in the defendant No,1 which therefore has full authority to operate it.
11. That with respect to the contents of para. 11 of the affidavit it is denied that the plaintiff is the owner of the stocks of sugar, molasses, and alcohol at the TSM. The defendant No, 1 is the lawful owner of TSM and of all the stocks of sugar, molasses, and alcohol, and is such fully entitled to sell or dispose of the same.
13. That the contents of para. 13 of the affidavit are denied. It is specifically denied that any property in the TSM vests in the plaintiff or that the defendant No, 1 has no authority in law to run, manage, or operate the TSM or its stocks. It is further specifically denied that stocks at the TSM belong to the plaintiff. The defendant is the lawful owner of the TSM and the stocks lying at the same and is therefore fully entitled to deal, sell, and dispose of the same.
14. That the contents of para. 14 of the affidavit are denied. It is specifically denied that the plaintiff shall be seriously prejudiced or that it would be deprived of its property or that it would suffer any loss, irreparable or otherwise, if the application is not granted and.
' TSM is allowed to be operated by the defendant No,
1. It is specifically denied that TSM would be misused or damaged if the defendant No, 1 was allowed to operate and manage the same. The allegation of the plaintiff is frivolous given the fact that the TSM was managed and operated for years by the defendant No, 1 and that it was, inter alia, on the demand of the workers/labourers of the TSM that the possession and management of the same was restored to the defendant No, 1.
15. That it will be in fact the defendant No, 1 which shall be seriously prejudiced and shall suffer irreparable loss if the application of the plaintiff is granted and the defendant No, 1 is restrained from carrying on the production of sugar, molasses, and alcohol, at the TSM or from selling or otherwise disposing of the stocks of the same. It is submitted that the stocks lying at the TSM are perishable goods and if the defendant No, 1 is restrained from selling or disposing of the same, they are likely to be wasted resulting in considerable loss to the Government and the national exchequer. It is submitted that restraining the defendant No, 1 from operating the TSM and carrying on production at the same would result in even greater loss to the Government and national exchequer in terms of loss of revenue in addition to causing great hardship to the workers/labouers at the TSM and the growers of sugarcane in the neighbouring area whose livelihood depends upon the operation of the TSM. In pursuance of the decisions taken in the Meeting dated 8-8-1994, the defendant No, 1 had to pay out three gross salaries of the employees/workers of the TSM from the working capital granted to it by the Government after the possession and management of the TSM was restored. The defendant No, 1 has so far been able to pay only two gross salaries to the workers/employees of TSM and the third salary still remains to be paid. It is submitted that if the defendant No, 1 is now restrained from disposing of or selling the stocks lying at the TSM, it would be unable to make up the deficiency in its working capital and would therefore be unable to operate the same to the detriment of all concerned. Such restraint would also result in the defendant No, 1 defaulting in the payment of salaries to the workers/labourers at the TSM which may lead to further serious problems. The defendant No, 1 is also facing considerable pressure from the workers/employees in this regard as is evident from the telex dated 26-9-1994. The balance of convenience thus lies in the dismissal of the application.
17. That the plaintiff cannot be granted any injunctive relief as prayed as it has itself prayed for damages/compensation in the plaint. It is submitted that if according to the own admission of the plaintiff, compensation/damages in money would be an adequate relief, it cannot be granted any relief by way of an injunction. Even otherwise, the injunction prayed for cannot be granted in view of the provisions of section 56 of the Specific Relief Act, 1877"
5. Their contentions are (i) that Thatta Sugar Mill was never sold to the plaintiff. The plaintiff was merely given management of the TSM pursuant to the Memorandum of Understanding dated 11-11- 1992 and that the parties failed to reach an agreement and thus there was not even a valid, concluded, or binding contract between the parties for the sale of TSM; (ii) that the ownership of and property in the TSM still vests in defendant No, 1 which therefore has full authority to operate it;
(iii) that defendant No, 1 is the lawful owner of TSM and the stocks of sugar, mollasses and alcohol, and is fully entitled to sell or dispose of the same; (iv) that the stocks lying at the TSM are perishable goods and if the defendant No, 1 is restrained from selling, disposing of the same, which are likely to be wasted resulting in considerable loss to the Government and the national exchequer; (v) that restraining the defendant No, 1 from operating the TSM and carrying on production at the same would result in even greater loss to the Government and national exchequer in terms of loss of revenue in addition to causing great hardship to the workers/labourers at the TSM and the growers of sugarcane in the neighbouring area whose livelihood depends upon the operation of the TSM; (vi) that the plaintiff cannot be granted any injunctive relief as it itself has prayed for damages, compensation in the plaint; (vii) that according to the plaintiff's own admission the compensation/damages in money would be an adequate relief, which cannot be granted by way of any injunction; (viii) that even otherwise injunction as prayed for in view of sections 56 of the Specific Relief Act; is barred; (ix) that tender of the plaintiff was accepted and was subject to further negotiations; (x) that there is no any documents to show that the property was transferred to the plaintiff; (xi) and that if the agreement is not concluded the relief i,e, the interlocutory application cannot be granted.
6. Here in this case also the plaintiff has claimed damages in the main suit sub-clauses (i), (ii) and
(iii) of clause (f) are reproduced as under:-- "(i) payments made to the defendant as per paragraph No, 35 of the plaint .......... Rs, 58,353,067
(ii) Various expenses incurred by the plaintiff in pursuance of the contract as stated above in paragraph 36 of the plaint ............................................. Rs, 58,159,864 Total Rs,116,512,931
(iii) Loss of Profit................ Rs,20 million caused by taking over of TSM.
7. They further contended that as the plaintiff has claimed damages in his suit as mentioned above, it would show that loss, if any sustained by him could be ascertained in terms of money, thus he is not entitled to grant of injunction.
8. In support of their contentions they have cited following authorities:-
(1) PLD 1982 Karachi 76--Case of Messrs Shalsons Fisheries Ltd., Karachi v. Messrs Lohman & Co.;
(2) PLD 1967 Karachi 372--Case of Bachu Bai F.E. Dinshaw v. Commissioner of Income-Tax.
(3) PLD 1972 Lahore 847--Case of Ch. Muhammad Younus v. The Islamic Republic of Pakistan.
(4) PLD 1993 Kar. 190--Case of Pakistan International Airlines Corporation v. Mis. Hazir (Pvt.) Ltd.
(5) PLD 1992 Karachi 17 relevant at page 20--Case of Muhammad Raza v. Haji Abdul Ghaffar.
9. The cases cited by the learned counsel for the parties in this matter are the final decision of the case and involve interpretation of provisions of Contract Act, Transfer of Property Act and Specific Relief Act. I therefore advisedly refrain from discussing the authorities and recording my conclusion because evidence is still to be led and the contention and dispute have to be examined in depth.
Any expression of opinion at this stage may prejudice either of the parties in having a fair trial. I would therefore confine myself to the disposal of the application in hand.
10. I would like to refer a case of AKMIDC UNITS, Muzaffarabad, etc. v. Moin-ud-Din (1987 MLD 1055).
' In the case learned Single Judge upon consideration of respective contentions of the parties held as under:- "To constitute an agreement, it is necessary that there should be an unconditional offer and it is accepted by the competent authority and after the constitution of the agreement, the right to the parties accrue. In the present case, the respondent No, 1, no doubt, made an offer to purchase the Mill, provided an area of the land measuring 371 Kanals was also given to him and the Committee, without accepting the conditions recommended the offer. This recommendation, I believe, could not have been accepted because the tenderer offered to purchase the Mill, provided his condition was accepted but the recommending body i,e, the Committee did not approve of the condition, hence it was not possible for the Government to accept its recommendation, unless the tenderer was asked to forego the condition. Be that as it may, as it transpires from the record, the offer has not been accepted, hence the augment has not come into being, therefore there accrues no right respondent No,1 on the basis of his offer."
12. Likewise in this case no final agreement was concluded between the parties and even agreement was not reduced in writing by the parties. Mere signing of the Memorandum of Understanding cannot be held as a valid agreement in the eyes of law.
13. As no agreement was finalized no legal or valid right to the plaintiff accrued on the basis of Memorandum of the Understanding.
14. (ii) There is also a decision of D.B. Of this Court in H.C.A. No, 80/92, reported in PLD 1993 Kar. 190 (PIA v. Mis. Hazir (Pvt.) Ltd. And another):- ' In this case their Lordships have observed as under:.
"The learned Single Judge failed to take into consideration the far-reaching financial and administrative consequences which were to ensue from his order. The natural consequences which will ensue and with little application of mind, it can be visualized by any man of ordinary prudence, are as follows:-
(1) The eight hundred employees would be deprived of the facilities.
(4) Uncertainty would prevail amongst the employees of the appellant. No one can be sure about the outcome of the litigation.
(5) Uncertainty would prevail amongst the persons running or have experience in operating Fast Food Services. No one can be sure about the outcome of the litigation. Consequently, the persons who are running or operating Fast Food Services would be slow to come and bid at the invitation of tenders of the appellant.
(6) The entire working of the appellant would be disturbed. This would result into demoralisation of the administration and also result into escalation of cost, the cost which will have to be ultimately borne by the passengers.
' In such cases, even temporary order can cause havoc and bring about a stalement or chaotic situation."
16. (iii) I would also like to refer the case of Muhammad Ashfaque v. Govt. Of the Punjab (PLD 1981 Lahore 752) relevant page 755.
' His Lordship has held as under:-- "7. Having given consideration to the controversy involved I am of the view that no case is made out by the petitioner for interference by this Court in the orders of the Courts below in exercise of the revisional jurisdiction. It has been very aptly pointed out by the learned counsel for the respondents that the mere presence of a prima facie case or arguability thereof will not by itself be a ground for issuing a temporary 'injunction. It is by now well settled that the three conditions viz. The existence of a prima facie case, the irreparability of loss, and balance of convenience must co- exist before the temporary injunction could be allowed in a matter."
8. It may also be observed that the issue of a temporary injunction whereb the functionin. Of a Government Department is likel to be hampered has also to be considered very seriously before the injunction is issued. This aspect has been duly discussed in a number of authorities, some of which have been cited by the learned counsel for the respondent and I am in respectful agreement with the principle laid down in this respect."
17. (iv) I would also like to refer to 1985 CLC 261, Aijaz Hussain Bhatti and another v. Haji Bagh Ali and 9 others where it has been held that "plaintiffs failing to make out a prima facie case of grant of temporary injunction--Delaing with questions of irreparable loss or injury and balance of convenience".
18. (v) In the case of Ch. Ali Akbar v. Province of Punjab through Collector, Faisalabad (1987 MLD 358) it has been held "plaintiff showing prima facie case but not fulfiling other two conditions qua balance of convenience and irreparable damage not entitled to temporary injunction during pendency of suit.
19. Here in this case also not only hundreds of employees would be deprived of their livelihood but sugarcane growers of the area will also suffer an irreparable loss, with the result that this might cause havoc and bring about a statement or a chaotic situation in the area.
20. Besides the points raised in this application relate to functioning of a Government Department is involved and if the injunction is granted normal functioning of a Government Department would be largely hampered and many difficulties and complications would arise which would also result in demoralisation of the administration.
21. I have gone through the material on record and the case-law cited by both the learned counsel for the parties and have also applied my mind and C come to the conclusion that so far the grant of injunction is concerned the plaintiff has failed to prove existence of three requisite conditions, viz. Prima facie case, irreparable loss and balance of convenience, if any. If any of the ingredients of out of these three conditions is missing, injunction cannot be granted. Prayer of the plaintiff that the defendant be restrained from operating TSM and/or carrying any activity in relation to production of sugar, mollasses and alcohol would not furnish any relief to the plaintiff at all and on the contrary it will be an overall loss of national exchequer in terms of loss of revenue and cause great hardship to the workers/labourers of the TSM and the growers of sugarcane in the neighbouring area whose livelihood depends upon the operation of the TSM.
22. So far the prayer for restraining the defendants from sale or otherwise I disposing or removing any stock of finished or half finished of sugar, mollasses and alcohol from the premises of the mill is concerned it is pertinent to note D that the stock of finished or half finished sugar, mollasses and alcohol are all perishable goods and if the defendants are restrained from selling or disposing of the same they are likely to be wasted or perished, resulting in considerable loss to the Government and the national exchequer.
23. Upshot of the above discussion is that the plaintiff has neither an arguable case nor does the balance of convenience, lie in his favour. He is not E likely to suffer an irreparable loss/injury as he has claimed damages in terms of money. Keeping in view the case-law cited above and the facts and circumstances discussed above this application, is dismissed, interim order of injunction stands recalled.