1. The plaintiffs' company were allotted a Plot of land bearing No.F-693 measuring 1 acre and after the recovery of 50% premium i.e. Rs.7,52,300 defendant No.5 executed a licence dated 3-8-1993 whereby the plaintiffs were allowed to erect a building upon the said plot at their own expense for a factory according to the plans and specifications as may be approved by the S.I.T.E. The terms and conditions of the licence provided that defendant No.5 shall grant a leasg to the plaintiffs for a term of five to ninety nine years at annual rent of Rs.2,800. On 12-8-1993 defendant No.5 handed over the vacant possession of the plot to the plaintiffs and delivered a sketch of the plot to them.
2. According to the plaintiffs, the defendants Nos. l to 3 trespassed on the said plot of land on 10-9- 1993 and started constructing boundary wall and a room, which was objected to but the said defendants being highly influential persons and being in collusion with defendant No.5 continued to commit the act of trespass and construction of the boundary wall and the room. In fact defendants Nos.1 to 3 were allotted Plot No.D-270 by defendant No.5 adjacent to the plot in suit. It is the case of the plaintiffs that when the act of trespass was being committed by defendants Nos. l to 3 the matter was reported to S. I. T. E. Police Station where a compromise was arrived at between the parties to the effect that these defendants shall cease to commit the act of trespass on the plot in suit. According to plaintiffs, defendant No.5 had left 10 feet wide lane for water and sewerage lines in between the plot in suit and the plot of the defendant No.4 i.e. D-255/A. This defendant had also trespassed and taken illegal possession of this space to the extent of 10' x 1815' The plaintiffs filed Suit No.27 of 1994 for injunction against the defendants Nos.1, 4 and 5 in the Court of I-Senior Civil Judge, Karachi (West) which Court granted status quo on 20-1-1994 which was confirmed on 23-1-1994. In the above suit defendant No.5 filed its written statement on 1-2-1994 which disclosed for the first time that S.I.T.E. Had cancelled the allotment licence in favour of plaintiffs on 18-1-1994 and allotted the plot in suit to defendants Nos. l to 3 and renumbered it as D-270. It was wrongly alleged in the written statement that the possession of the said plot now vested in the defendants Nos. 1 to 3. Alongwith the said written statement, they attached a copy of letter dated 18-1-1994 which had not been received by the plaintiffs. It has been urged that the alleged cancellation was in collusion with defendants Nos.1 to 3 and was of no effect whatsoever especially after the defendant No.5 had already received Rs.7,50,000 and issued the licence which was in fact a lease for ninety nine years. The same could not have been cancelled or withdrawn because no notice was served on the plaintiffs. They have challenged the act of defendant No.5 as unwarranted, illegal, mala fide and for extraneous reasons, also because they had accepted a further amount of Rs.3,75,000 from the plaintiffs on 6-2-1994. It is in these circumstances that the plaintiffs have sought a temporary injunction against the defendants Nos.1 to 3 seeking to restrain them from dealing with the plot in suit in any manner and from entering into an agreement of sale and from mortgaging or encumbering or charging the same in favour of any person and from raising construction thereon whatsoever. As against the defendant No.5, injunction has been sought to restrain them from dealing with allotment lease of the plot to any of the defendants or allowing transfer of the said plot to any person and from allowing any application of the same by any person whatsoever or from acting on the letter of cancellation dated 18-1-1994 in respect of the plot in suit till the decision of the suit.
3. Defendants Nos.1 to 3 and 5 have contested this application and filed counter-affidavits controverting the case of the plaintiffs to which affidavit-in--rejoinder has also been filed. It is the case of the defendants that the plaintiffs are the evicted licensee by their own admission and as such cannot maintain suit for possession or injunction in respect of the plot in suit and therefore the remedy, if any, is only by way of damages. It is alleged that the plaintiffs have tried to mislead this Court by denying receipt of the cancellation letter, dated 18-1-1994 and they have thereby disentitled themselves to all discretionary reliefs. It has been denied that they did not know till 1-2- 1994 that Plot No. D-270 S. I. T. E. Had been allotted to defendants Nos. l to 3. It is the case of the defendants that plaintiffs' cancellation was coupled with an offer by defendant No.5 to allot them an alternate plot for good reasons but instead of selecting an alternate plot, they have mala fide taken to harass the defendants Nos. l to 3. As regards the matter relating to trespass being reported to S. I. T. E. Police Station, defendants have stated that plaintiffs have suppressed the facts by not stating that the matter was reported to police by defendants Nos. l to 3 when the plaintiffs themselves had illegally and high-handedly demolished the constructions raised by defendants Nos.1 to 3 on their aforesaid Plot No.D-270 and also that in the compromise they had agreed to themselves re-erect the said demolished construction and further that having so agreed failed to re-erect anything. Besides the plaintiffs have raised no construction whatsoever on the plot allotted to them at any time nor have filed any approved building plan in terms of the licence granted to them. As regards their own case, defendants explained that defendants -Nos. l to 3 had applied for industrial land to defendant No.5 on 4-9-1991 and paid 10% premium Plot No-D 270 was allotted to them on 8-2-1992 and they had paid 40% of the premium on 7-3-1992. On 26-4-1992 a licence in standard form was granted to them, on 22-9-1993 they applied for relocation of their plot since a graveyard was encroaching upon their Plot i.e. No.D-270 while on 18-1-1994 defendant No.5 re-located D-270 as its present site.
4. Defendant No.5 through their Secretary filed a separate counter--affidavit stating that they were established on 2-1-1947 by a Government Resolution for the rapid and orderly industrialization of the Province of Sindh and registered on 29-11-1947 as a Company limited by guarantee of the Government of Sindh with no shareholders and for this purpose the Government of Sindh gave them thousands of acres of Government Lands in Karachi and other parts of the Province where they have established industrial estates, where industries are flourishing. This defendant has contested and controverted the prayer of the plaintiffs and supported the case set up by defendants Nos. l to 3.
5. Defendant No.4 has not appeared to contest the application for temporary injunction.
6. Mr. Mansoorul Arfin, learned counsel appearing for the plaintiffs has referred to para. 1 of the Agreement to licence dated. 3-8-1993 executed by defendant No.5 in favour of the plaintiffs which says that if and when factory, hereinafter agreed to be erected by the applicant, shall be completed within the time and in conformity with the terms and conditions of the licence so as to be fit for use to the satisfaction of the owner and on receipt of certificate in writing to the effect that all the terms and conditions of this agreement have been duly complied with and that the factory erected is fit for use the owner shall by a good and sufficient lease, demise unto the applicant all that piece or parcel of land admeasuring 1 acre or thereabout in the term of five to ninety nine years at annual rent of Rs.2,800. In pursuance of this agreement the plaintiffs have been handed over the piece of the plot by defendant No.5 on 12-8-1993 whereafter they continued to remain in exclusive and peaceful possession thereof till the act of trespass committed by defendants Nos.1 to 3 who started constructing boundary wall and a room on the plot. The act of defendants Nos. l to 3 on being resisted the matter was taken to S.I.T.E. Police Station where the parties compromised the same vide Annexure "P/8" to the plaint. Learned counsel contended that the defendant No.5 disclosed for the first time on 1-2-1994 in their written statement filed in Suit No.27 of 1994 that this plot had been allotted to defendants Nos.1 to 3 after the cancellation thereof in favour of the plaintiffs which was void and illegal as there was no breach of terms and conditions of the agreement and the S.I.T.E. Could not cancel the licence which in fact was in a nature of lease without any show-cause notice and an opportunity of hearing. He has relied upon a D.B. Judgment of this Court in the case of United Bank Limited v. Muhammad Azim and another PLD 1985 Kar. 215 where it was held that in the instant case there is an agreement between the parties that a 99 years lease will be executed in accordance with terms and conditions of licence after the building is constructed. The mere fact that the Society, as against the allottee, is merely a licensor, does not make the allotment provisional as it is not a case of licence or allotment simpliciter, but a case of transfer of plot with possession against full payment of price and agreeing to execute a 99 years lease in favour of the allottee as stipulated in the terms and conditions mutually agreed. Reliance has also been placed on the judgment reported in PLD 1985 Kar. 326 which was a case of cancellation of allotment of a plot by P. E. C. H. S. In favour of a person not being member of the Society. In the absence of the commission of any breach of terms of sub-licence a Division Bench of this Court set aside the cancellation as being without lawful authority.
7. Learned counsel has also referred to a Single Bench judgment of this Court reported in PLD 1985 Kar. 481 delivered by Abdul Hayee Kureshi, J. (as he then was) holding that if rights in land are given to a person for the purpose of construction of a permanent nature, the presumption in law would be in favour of construing such a transaction as a lease rather than licence. While referring to section 52 of the Easements Act learned Judge held that whenever a person grants to another person a right to do or continue to do something which without such grant would be unlawful; such right would be a licence. If a right creates an interest in property, grant cannot be called a licence.
8. It may be pointed out that the judgment reported in PLD 1985 Kar. 215 is the appellate judgment from this judgment by the learned Single Judge.
9. In the case of Nasira Sultana v. Habib Bank Ltd. And others PLD 1975 Kar. 608 it was held that the aforesaid terms and conditions no doubt entitle the K.D.A. To terminate or cancel the allotment but not without cause and only in the event of a default committed by the allottee. The allotment is not a licence simpliciter for the allottee has a right to be put in possession of the plot on payment of second instalment, raise constructions thereon and on payment of the full occupancy value the K.D.A. Was bound to grant a 99 years lease to the allottee.
10. Mr. Mansoorul Arfin also referred to a case reported in 1988 CLC 1948 in which the area of the plot allotted in favour of the petitioner was reduced without the issuance of a show-cause notice. The action on being challenged by way of writ petition was held to be without lawful authority. In this petition which was directed against an action of S.I.T.E. Limited a Division Bench of this Court after considering earlier case-law on the subject held that the allotment of plot coupled with permission to raise permanent construction thereon, could not be cancelled without providing affected person opportunity of being heard and without any cogent reason.
11. On the other hand learned counsel appearing for the contesting defendants vehemently contended that the plaintiffs being evicted licensee cannot maintain a suit for injunction and therefore are not entitled to a temporary injunction as they were not in possession of the plot in suit on the date of the institution of the suit and their remedy if at all any law in a suit for damages.
12. Learned counsel has relied upon the case-law reported in the following judgments;
(1) AIR 1956 Orissa 156.
(2) AIR 1927 All. 633.
(3) AIR 1950 Punjab 40.
(4) PLD 1963 (W.P.) Lahore 413 In the judgment cited at Serial No.1 which was a case under sections 52 and 60 of the Easements Act, it was held as under:--- "But it is essential, whatever be the rights of the licensee, that he should have, and continue to have an interest in the subject-matter of the contract. Actual occupation of the land is necessary for clothing the licensee with a right which can be enforced in a Court."
13. In the second case, which was a claim by licensee for possession, the Court found that the plaintiffs were never in possession of the site in dispute. In these circumstances, it was held that the plaintiffs not having any interest in the site could not maintain an action for possession of the same in their own name.
14. In the third case which arose out of an application for temporary injunction, it was held that even where the licence is revocable the licensee is entitled to a reasonable notice before the license is revoked. If, however, the licence is revoked without reasonable notice the remedy of the licensee is by way of damages and not by way of an injunction.
15. In the fourth case which arose out of a dispute between a licensee and the west Pakistan Road Transport Board, it was held that his right to occupy the premises having been determined by notice given to him to quit the premises, it was his legal duty to surrender possession to his licensor. After that no legal right to retain the possession inhered in him. His remaining on the land even became unlawful and it was not necessary for the licensor to apply to a Court to eject the licensee whose licence had been determined, which protection is only available to a lessee in Pakistan. It was held that if the revocation of the licence amounts to a breach of the contract, the licensee can recover damages from the breach, but he is not entitled to bring a suit for injunction.
16. In para. 18 of the report, it was held that no suit for injunction lies even in those cases where there is a breach of the licence by the licensor, which means that no such suit lies where there is no breach. It would appear that' the judgments cited on behalf of defendants are not in point and completely distinguishable on facts from the facts of the suit in hand. The plaintiffs having been put in possession of the plot by defendant No.5 on 12-8-1993. Annexure ' P/6.' to the plaint and there being absolutely no evidence to indicate that they had surrendered the possession of the plot in favour of defendant No.5 it cannot be held by any stretch of imagination A that they are the evicted licensees and thus not entitled to seek the remedy of an injunction. Learned counsel with reference to paras. 4 and 18 of the plaint contended that the plaintiffs having taken no steps for erection of the factory building by not submitting any construction plan for approval by defendant No.5 have committed a breach of the terms and conditions of the licence and their licence was rightly cancelled as defendant No.5 do not encourage speculative investors and they believe in rapid and expeditious growth of industries. In the first instance this plea was not raised in the counter-affidavit or in the written statement. Moreover, the fact remains that plaintiffs as averred by them, were put in possession of the plot only on 12-8-1993, the defendants Nos.1 to 3 attempted to commit a trespass on their plot on 10-9-1993, and the allotment was unilaterally cancelled vide defendants letter dated 18-1-1994, with the consequence that there was hardly any time at the disposal of the plaintiffs to submit the construction plan for approval by defendant No.5. In any case there being a stipulation in the agreement, dated 3rd August, 1993 that on erection of the factory building by the plaintiffs with the approval of the defendant No.5 the latter would execute a lease for a term of five to ninety nine years in their E favour, plaintiffs have made out a good prima facie case for protecting their rights and interest in the plot in suit and it can be said for the purpose of temporary injunction that they have prima facie an arguable case which requires consideration at the trial.
17. The next point urged by learned counsel for the defendants to the effect that the plaintiffs had not come to Court with clean hands is based on the averment in para. 8 of the plaint to the effect that when the action of trespass was being committed by the defendants Nos.1 to 3, the matter was reported to the S.I. T. E. P. S. Where a compromise was arrived at between the parties to the effect that these defendants will cease to commit the act of trespass. Learned counsel vehemently contended that in fact defendants Nos.1 to 3 had reported the matter against the plaintiffs to police by way of lodging an F.I.R. On 21-12-1993 which the plaintiffs had deliberately suppressed in their plaint as well as in the affidavit in support of the injunction application. Learned counsel for the plaintiffs on the other hand, pointed out that the circumstance with regard to the matter having been taken to police station resulting into a mutual settlement was in fact pleaded and a copy of the compromise placed on record it was immaterial if it was not said as to which of the parties had taken the matter to police authorities. On the contrary, defendant No.5 had acted in collusion with defendants Nos. l to 3 by cancelling the allotment in favour of the plaintiffs, amalgamating area of the plot in suit with the area of the Plot No. D-270 allotted to defendants Nos. l to 3. As regards the service of letter of cancellation dated 18-1-1994 on the plaintiffs he referred me to the endorsement by the despatch section reporting on 27-1-1994 to the effect that this letter could not be delivered to the plaintiffs as their office was found closed as they had shifted to some other place. There is further noting on the said endorsement, dated 30-1-1994 indicating that while the original letter addressed to the party had been returned back undelivered, the original file of the concerned party was lying with Legal Cell. It was pointed out that the noting to the effect that the original file was still lying with Legal Cell was pertinent as after the cancellation of the allotment on 18-1-1994 there was no logic behind retaining the file by the legal department even on 30-1-1994. On the other hand, Mr. S.A. Ahmad has referred to the note by Deputy Chief Engineer SITE Ltd. Addressed to the Managing Director recommending the cancellation of allotment in favour of plaintiffs and its allotment in favour of defendants Nos. l to 3 for the reason that the plaintiffs were not interested in industrial activity and that they were speculators where as Messrs Beg Enterprises were interested in earmarking of this land with 50' wide strip and very keen to set up an industrial unit. A reference was also made to the fact that a meeting in this respect was held in the Chamber of Secretary Industries and Mineral Development on 17-1-1994 where the matter was reported and discussed.
18. The note goes on to state that finally it was also decided to cancel the earmarking of the Plot No. F- 693 and the same in workable length and breath may be earmarked in favour of M/s. Beg Enterprises. This noting was marked to the Secretary with the endorsement by the Managing Director "for kind confirmation / approval". The aforesaid noting would prima facie give clear impression that defendant No.5 had acted on extraneous considerations and succumbed to the influence of defendants Nos. 1 to 3 seeking to dislodge the plaintiffs and to acquire the rights and interest in the plot in suit without any notice to the plaintiffs and in the absence of any breach of terms and conditions of the grant. There is no gain saying that it is inconceivable that the matters within the competence and domain of defendant No.5 should have been discussed and finalised in the Chamber of Secretary, Industries and Mineral Development Department and a decision taken in utter disregard of the principles of natural justice. In the circumstances, it is difficult to agree with the stand taken by Mr. S.A. Samad Khan to the effect that the defendants had disentitled themselves to the grant of discretionary relief by reason of having come to Court with unclean hands.
19. Lastly, learned counsellor the defendants contended with vehemence that defendant No.5 being a public department under the Provincial Government, no injunction could be legally issued against them in terms of section 56(d) of the Specific Relief Act. In this connection, he cited an observation of a Division Bench of this Court in an unreported judgment in Constitutional Petition No.1770' of 1991, decided on 19-2-1992 observing that the petitioner i.e. S.I.T.E. Limited was functioning as a Department of Provincial Government of Sindh. It is pertinent to note that in this petition, the stand of learned counsel appearing for the petitioner was that S.I.T.E: was not a Department of Provincial Government of Sindh and as such the notice issued by the Provincial Ombudsman to them was wholly without jurisdiction. The contention of the learned counsel in the said petition may be reproduced for the sake of convenience which reads as under:--- "Mr. S.A. Samad, learned counsel for the petitioner firstly contended before us that the ratio laid down in PLD 1975 Kar. 128 are being interpreted wrongly as in that case the Court did not hold that the petitioner is a Department of the Provincial Government of Sindh.
20. Learned counsel further contended that the judgment of Sindh High Court in any case stood merged in the appellate judgment of Supreme Court, which never decided that the petitioner is a Department of Provincial Government of Sindh."
21. Even in the counter-affidavit sworn by Secretary S.I.T.E. Defendant No.5, their case is that defendant No.5 were registered on 29-11-1947 as a Company Limited by guarantee of the Government of Sindh with no Share capital, no shareholders, issuing no dividend and that they had established industrial estates at Karachi and many other places. In this view of the matter, it is not open to the defendants in the present proceedings to take a contradictory stand and claim it to be a public department. Learned counsel has cited the following judgments in support of his contention:
(1) 1980 CLC 1873.
22. (2)1987 CLC 2416.
(3) PLD 1992 Pesh. 76.
23. (4)1979 of England Reports 1008.
(5) PLD 1966 SC 612.
(6) PLD 1960 Kar. 826.
24. Suffice it to say, there is no cavil with the proposition of law propounded in these authorities, these are of no avail to the contesting defendants in view of distinguishable facts of the case.
25. In the circumstances of the case, I am convinced that the plaintiffs have made out a strong prima facie case for the grant of temporary injunction. Obviously the balance of convenience lies in their favour and they would suffer an irreparable loss in case the interim injunction asked for is not granted.
26. For all these reasons, I would confirm the ad interim injunction granted earlier.
27. C.M.A. No.3764/94 By this application the plaintiffs have prayed for taking action under Order 39, Rule 2(3), C.P.C.
28. Against the defendants Nos.1 to 3 and Secretary as well as Managing Director of defendant No.5 for committing contempt of Court. It has been urged that on 10-2-1994 this Court had passed an order granting ad interim injunction as prayed whereas defendants Nos.1 to 3 had made an application to the defendant No.5 for permission to mortgage the plot of land in suit for taking loan from Habib Bank Limited, Clifton Road Branch, Karachi. It is further urged that the defendant No.5 by its Letter No.Adm.2584/1806, dated 20th April, 1994 granted its permission a photo copy whereof has been filed in support of the prayer Defendants have filed counter-affidavits and controverted this allegation. It is their case that defendants Nos.1 to 3 applied to the defendant No.5 for permission to obtain a loan from a Bank and on 20-4-1994 defendant No.5 granted the permission however subject to an undertaking. They have filed copy of the letter-dated 20-4-1994 addressed to respondent No. 1. The letter was issued by defendant No.5 tends to permit allottee to obtain a loan from Habib Bank Limited subject to the conditions; firstly, that the construction on the plot will be done after obtaining approval of the plan by S.I.T.E., secondly S.I.T.E. Will continue to retain prior lien on all the fixed assets on the plot; thirdly, terms and conditions of the charge will be sent to the defendant No.5 for approval before its creation and lastly the validity period of this letter shall expire after 90 days from the date of its issue and that any document on the basis of this letter for permission after the expiry of such period of 90 days will not be binding on S.I.T.E. Secretary and Managing Director of defendant No.5 have also filed their counter-affidavits denying the allegation and taken a stand in line with the plea of defendants Nos. l to 3. The contesting defendants have also annexed to their counter- affidavits a copy of the letter signed by defendant No.3 on behalf of defendant No. I undertaking to the Managing Director S.I.T.E. Limited not to apply for confirmation of this permission till the injunction order in Suit No.88 of 1994 was vacated by the High Court. In order to find out the truth of the matter on the application of the plaintiffs' Manager, Habib Bank Ltd. Clifton Road Branch, Karachi was summoned along with the record of obtaining loan by the defendants who appeared in Court on 12-10-1994 and made a statement in writing that defendants Nos. l to 3 had not created any mortgage in favour of the Bank over the plot in suit.
29. Upon hearing learned counsel for the parties, I am of the view that at the most defendants Nos. l to 3 had attempted to create a charge on the plot in suit and did not actually commit any breach of injunction order within the meaning of the term or for that matter the contempt of Court as alleged.
30. Needless to point out, the conditional permission granted by defendant No.5 expired after 90 days which period ended on or about 19-7-1994 whereas the instant application was moved on 28-8- 1994 during the hearing of C.M.A. No.669/94.
31. For these reasons, there is no substance in this C.M.A., which stands dismissed.
32. A.A./N-549/K Accordingly.