1. By this application, urgent hearing of another application (Civil Miscellaneous Application No.4000 of 1997) under Order XVIII, Rule 18, C.P.C. Is sought. Since the matter is already fixed for hearing of Civil Miscellaneous Application No.3859 of 1997, this application is granted.
2. In pursuance of order passed at serial No. 1, this application is taken up. The learned counsel for the defendant submits that without conceding to the factual averments contained in this application and the affidavit filed in support thereof and further to show hid bona fides, he does not oppose the grant of this application. By consent, Mr. Muhammad Shafi Roonjho, former. Registrar is appointed as Commissioner to inspect the building known as 'Rabat Jo Daro' on Plot No. 172-L, Mian Tariq Road, Block No.2, P.E.C.H. Society, Karachi with specific reference to the office premises No.D-5 on 4th floor and to report the stage/state of construction and occupation of various units by the allottees therein. The fee .Of the Commissioner is fixed at Rs.4,000 which shall be deposited with the Na7ir of this -Court by the plaintiff for payment to the Commissioner within one week from today.
1. Inspection, as above, shall be carried out after notice to both the parties about date and time and report shall be submitted within 15 days from today.
3. By this application the plaintiff seeks interim injunction to restrain the defendant from transferring, alienating or encumbering the subject premises being D-5, 4th Floor, in the project known as 'Rabat Jo Daro' on Plot No. 172-L, Main Tariq Road, P.E.C.H.S., Block 2, Karachi, or dealing with the same, in any manner, during the pendency of the suit. The plaintiff who was admittedly working as a contractor for the defendant in construction of the abovereferred project known as 'Rabat Jo Daro had booked the subject office for a total price of Rs.4,45,000 on 28-12-1994. An application form was filled up on the said date which contained the following terms and conditions:- "(1) Showroom/Office complete in all respect shall be handed over to the Buyer within one month from the date of booking.
(2) In case of failure in payment of instalments the company holds the right to cancel the office/showroom after the expiry of 15 days Notice and money will be refunded after completion of the project with 10 % deduction.
(3) There shall be no extension/negotiation on payment schedule mentioned in the schedule of payment of Project.
(4) In case of any dispute arising as regards the project the (KBCA/KMC) shall act as an arbitrator whose findings will be the final word for the both parties."
2. On the same day, Allocation Letter was issued by the defendant to the plaintiff and a receipt was issued evidencing payment of Rs.50,000 by the plaintiff. It is further an admitted position between the parties that additional payment of Rc.1,15,000 was received by the defendant by way of adjustment from the running bills submitted by the plaintiff. Such position is duly reflected from letter dated 25-11-1995 sent to the defendant by the plaintiff showing therein the balance amount due from it as Rs.2,80,000. It appears that differences arose between the parties in regard to execution of works at the project of the defendant and Suit No.697 of 1995 was filed by the plaintiff before the Court which was disposed of on the basis of award given in arbitration proceedings and a decree in the sum of Rs.5,37,000 was passed favouring the plaintiff. The parties are further ad- idem with regard to satisfaction of such decree ire the form that Rs.3,42,000 was paid by the defendant to the plaintiff and the balance amount of Rs.1,95,000 was adjusted towards the price of the subject premises.
3. Such adjustment was duly acknowledged through receipt dated 30-1-1996. The plaintiff, thus, has made a total payment of Rs.3,60,000. The contention on behalf of the plaintiff is that the balance amount is payable at the time of delivery of vacant possession of the subject office whereas the defendant claims that a sum of Rs.1,40,000 had to be paid by the plaintiff in accordance with schedule of payment which is alleged to have been given to the plaintiffs at the time of booking. I may note here that copy of the schedule of payment has not been placed on record by either of - the parties. The other aspect which has remained unexplained is the amount of total consideration.
4. According to the defendant, the total price of the subject office was revised to Rs.5,00,000 at the time of adjustment of Rs.1,95,000 out of the decretal amount, as above. However, on behalf of the plaintiff, it is asserted that the total price was agreed to be Rs.4,45,000 but a sum of Rs.55,000 in lump sum, was agreed as the registration charges and other miscellaneous expenditure. Thus the total price came to Rs.5,00,000. The documents which have been placed on record containing.
5. Correspondence between the parties may, at this stage, be taken into consideration to find out the stand of the two parties. On 15-2-1996, the plaintiff wrote a letter to the defendant acknowledging therein satisfaction of the above--referred decree. It is pertinent to note that in such letter the total price of the subject office was disclosed as Rs.5,00,000 but nothing was stated as to when was the balance amount to be paid. It was also not asserted therein if the registration charges and the other miscellaneous expenditures were included in the sum of Rs.5,00,000. Next on record, is another letter from plaintiff dated 10-7-1996 wherein the total cost of the subject office was mentioned as Rs.4,45,000 and the defendant was called upon to complete the project and to hand over the possession of the subject office. Again, nothing was mentioned with regard to time for payment of the balance amount of consideration. On the same date a letter, dated 10th July, 1996 appears to have been sent by the defendant to the plaintiff mentioning therein that a sum of Rs.1,40,000 was outstanding against the plaintiff in respect of the subject office and late payment surcharge in the sum of Rs.3,840 was leviable thereon. The payment of Rs.1,43,840 was, therefore, demanded within seven days from receipt of such letter to facilitate timely completion of the project. According to the learned counsel for tire plaintiff, the contents of the said letter dated 10-7- 1996 do indicate that the project was not complete at such time. In reply to the above letter the plaintiff sent a letter, dated 15th July, 1996 mentioning therein that only 60% work had been executed at site whereas the payment made by the plaintiff, till then, represented 72% of the total price including utility connections, miscellaneous expenditure etc. Again, nothing was mentioned in the letter as to the assertion that the balance payment had to be made after delivery of the subject office. In reply, on 20th July, 1996, the defendant notified the plaintiff that the outstanding dues should be settled within seven days threatening to cancel the booking in the event of non- payment. The contents of letters, dated 10th July; 1996 and 15th July, 1996 sent by the plaintiff were denied as false. Such letter was followed by two letters, dated 30 July 1996 and 8th September, 1996 from the plaintiff asserting again that there were no outstanding dues and the defendant was called upon to provide detailed schedule for completion of the balance work. On 12-9-1996, the defendant sent a three line letter in reply to the letter, dated 8th September, 1996 drawing attention of the plaintiff to its earlier letters dated 10-7-1996 and 20-7-1996. On behalf of the plaintiff, on 23- 9-1996 yet another letter was written mentioning therein that the defendant had neglected to complete the project and had failed to deliver the possession of the subject office within the agreed time. It was notified in such letter that the plaintiff was s ready and willing to pay the balance consideration, as per agreement, and such could not be paid for the reason that the project had not been completed and possession of the subject office had not been handed over.
6. As to what was the agreement between the parties for payment of balance consideration or what was the specified period for completion of the project, nothing was mentioned in the letter. This was followed by legal notice dated 17-3-1997 sent to the defendant wherein it was asserted for the first time that the balance payment had to be made at the time of delivery. On 5-4-1997 the learned counsel for the plaintiff sent yet another notice wherein while asserting the contents of earlier legal notice, the defendant was notified that the time was being made essence of the contract. A reply was then sent by the defendant's counsel to the counsel for plaintiff mentioning therein that the plaintiff had failed to clear the, dues despite remainders and letters, which amounted to breach of agreement causing heavy financial loss to the defendant. The last two paragraphs of such reply being material are reproduced hereinbelow:-- "That in the above circumstances my clients have no other alternative but to cancel your clients allotment and also intimated to your clients vide letter dated 20-7-1996.
7. Now, I, as per instruction of my abovesaid clients request you to please to advise your clients to collect the payment after necessary deduction as per terms and conditions of the contract/agreement, as the allotment has already been cancelled as intimated vide our aforesaid clients letter dated 20-7-1996."
8. It is pertinent to mention that nothing was stated in the above reply dated 21-4-1997 that the subject office had, in the meantime, been allotted or any third party interest been created therein.
9. A further letter seems to have been sent on 3-5-1997 by the plaintiff's counsel which was addressed directly to the defendant with reference to the abovereferred reply dated 21-4-1997.
10. Surprisingly, in such letter nothing was stated to protest against cancellation of the booking and a demand was simply made for delivery of vacant physical possession of the subject office offering therein to make payment of the balance sale consideration simultaneously with the handing over of possession. On 15-5-1997, reply to letter dated 3-5-1997 was sent by the defendant's counsel asserting therein that the plaintiff had no right to take over possession for the reason that the allotment had already been cancelled. The plaintiff was advised to collect refund of the amount from the defendant.th I have heard both the learned counsel. The learned counsel for the plaintiff has urged that after payment of a sum of Rs.3,60,000 out of the total consideration of Rs.4,45,000 the plaintiff was entitled to specific performance of the agreement dated 28-12-1994 and the defendant was obliged to complete the project. It is further asserted by Mr. Tufail Ebrahim that the defendant has failed to carry out construction and while his clients are ready and willing to make payment of the balance amount of consideration, the allotment could not be cancelled. The defendant cannot take advantage of its own wrong and set up the plea that the plaintiff was a defaulter. On behalf of the defendant it is asserted that there was no concluded or complete contract between the parties and the booking of the subject office had lawfully been cancelled through letters, dated 10th July, 1996 and 20th July, 1996. It is further urged by Mr. Awan that on 16-12-1996, the defendant had allotted the subject office to one Mrs. Abeer Shaikh and possession of the subject office was also handed over to her on 13-1-1997: The learned counsel submits that the grant of interim injunction shall adversely affect the interest of the said third party who has been impleaded in the present proceedings. In support of his submission that third party interest has been created in respect of the subject office, the learned counsel for the defendant has filed photostat copies of an undated Application Form showing Mrs. Abeer Sheikh as applicant, Possession Letter and "Handing/Taking Over" both dated 13-1-1997. On reverse of the Application Form agreement/schedule of payment is shown to have been typed mentioning therein that a sum of Rs.3,00,000 had been paid at the time of booking viz. 16th December, 1996 and the balance payment of Rs.1,97,000 was to be paid on or before 16-1-1997. Possession of the subject office was agreed to be handed over within 10 'days after the final payment. It is pertinent to mention that the photostat copies of the three documents which have been filed alongwith counter-affidavit do not bear signature of any of the parties.
11. Neither any receipt evidencing payment by the abovereferred Mrs. Abeer Shaikh nor any other proof of payment of a sum of Rs.4,97,000 been offered on behalf of the defendant. During hearing, the learned counsel for the defendant showed me originals of the said documents. I have returned the originals and retained photostat copies of the documents shown to me, on the file. A comparison of the two sets shows that the copies filed alongwith the counter-affidavit are of different set of documents. The agreement/schedule of payment type on reverse of the application Form, however, is not signed at all. The learned counsel for the plaintiff, in view of said discrepancies, asserts that the stand taken with regard to creation of third party interest is not genuine at all and has merely been set up to defeat the claim of the plaintiff.
12. The various documents which have been produced by the parties and the contents of the affidavits show that the bone of contention is as to whether allotment of the subject office had been cancelled and if so whether such cancellation could, in law, be effected. I am mindful of the constraints as are to be exercised while deciding interlocutory applications. However, the two letters, dated 10th July; 1996 and 20th July, 1996 can hardly be read as notices informing the plaintiff about cancellation of the booking/allotment of the subject office. While the plaintiff has also not come out clearly with offer of payment of the balance amount of consideration, the defendant too has not acted fairly. Both the parties seem to have been acting with cards close to their chest and did not come out with clear facts. Be that as it may, the admitted position is that the plaintiff has paid substantial amount of consideration and the booking/allotment of the subject office could not have been cancelled without giving clear notice to the plaintiff, Even the terms and conditions appearing on the Application Form show that the defendant was entitled to cancel the booking after expiry of 15 days' notice. Neither of the two letters, dated 10th July, 1996 and 20th July, 1996 stands the test prescribed the defendant itself in the abovereferred terms and conditions. One more factor which needs to be noted is that the defendant's counsel who sent replies dated 21-4-1997 and 15-5-1997 did not mention the fact that the subject office had been allotted to any third party on 16-12-1996 as alleged` in the counter-affidavit. In the circumstances, while the real facts shall have to be thrashed out after evidence is led by both the parties, I am of the view that an arguable case has been made out by the plaintiff. In the absence of any tangible material showing actual cancellation of booking held by the plaintiff, the second allotment could not be made nor can take effect. The learned counsel for the plaintiff has referred to section 48 of the Transfer of Property Act and contends that in the absence of a valid and lawful cancellation of the booking made by the plaintiff, no rights can be created in favour of a third party who being subsequent allottee cannot assert any claim during subsistence of allotment in favour of the plaintiff Reliance in this respect is placed on the case of Muhammad Ishaq and another v. Dr. Saiduddin Swaleh and another (PLD 1960 (W.P.) Karachi 48).
13. As regards the contention that no concluded or complete contract had come into existence between the parties, suffice to observe that the Application Form, Allocation Letter and the various receipts issued by the defendant coupled with the correspondence exchanged between the parties, do establish a concluded contract between the parties capable of specific performance.
14. Indeed, such issue, and, if the plaintiff has lost its right to specific performance, can finally be decided only after the evidence is led by the two parties. One more aspect which may be noted at this stage is that the plaintiff has alleged that the project of the defendant is still incomplete.
15. However, such assertion is denied by Mr. Awan who submits that the project is substantially complete and, in any event, the subject office after completion has been handed over to the above named third party.