MALIK MUHAMMAD QAYYUM, J.- This is plaintiffs' first appeal from the judgment and decree dated 5.1.1989 of Senior Civil Judge, Toba Tek Singh dismissing the suit for specific performance of the agreement for sale which they had instituted against the respondent
2. The dispute relates to agricultural land measuring 68 kanlas and 15 marlas situate in Chak No. 299, Tehsil Gojra, District Toba Tek Singh. It is common ground between the parties that by an agreement dated 30.1.1982 the respondents had agreed to sell the aforesaid land to the appellants for a consideration of Rs. 3,26,000/-. It is also an admitted position that at the time of execution of the agreement a sum of Rs. 74,0001- was paid as earnest money. It was further agreed between the parties that another amount of Rs. 55,000/- shall be paid by the appellant to the respondents on 28.2.1982. The balance was to be paid on 13.1.1983, the date fixed for execution of the sale-deed or at attestation of mutation.
3. In the suit filed by the appellants it was averred that despite various requests the respondent had failed to execute the sale-deed on the receipt of balance amount of consideration.
4. The suit was defended by the respondent on the plea that though he had been ready and willing to perform his part of contract by executing sale-deed, the appellants failed to do so with the result that the agreement was rescinded by the respondent.
5. The parties went to trial on the following issues:-
(1) Whether the plaintiffs were ready and willing to perform the agreement and did they commit no default in terms of agreement of sale? OPP
(2) If issue No. 1 is proved, what is its effect on the present suit? OPD
(3) Whether the suit is time-barred? OPD
(4) Whether the plaintiffs are estopped by their conduct to bring this suit? OPD
(5) Relief.
6. In support of their case, the plaintiffs examined PW. 1 Ghazi Muhammad Bashir PW. 2 Muhammad Abdullah, PW. 3 Abdul Karim, PW. 4 Mushtaq Ahmed, PW. 5 Muhammad Siddique, PW. 6 Muhammad Anwar and Muhammad Anwar Khan, son of Bakhshish- A.I as PW.
7. The evidence led by the respondent comprises the statements of Pir Muhammad, DW. 1, Ahmad Khan DW.2, Waris A.I DW.3, Hamayat Khan DW.4, the defendant appeared as his own witness as DW.5.
7. The suit was dismissed by the Trial Court on 5.1.1989 in view of its findings that the appellants had failed to perform their part of the agreement and were, as such, not entitled to have it specifically enforced. It was held that though the respondent had gone to the office of Sub-Registrar for the purpose of execution of the sale-deed on 13.1.1983, the appellants absented themselves.
8. !II/support of this appeal learned counsel for the appellants has contended that the findings of the Trial Court that the appellants were not ready and willing to perform their part of the contract are based upon misreading of record inasmuch as it stands established that the appellants have been making efforts to persuade the respondent to execute sale-deed on the receipt of balance amount of consideration but he had been avoiding to do so. In the alterative it was argued that the time being not essence of the contract, the fact that the balance amount of consideration was not paid 5y the due date, could not result in dismissal of the suit for specific performance.
9. The learned counsel further argued ;hat in the written statement the respondent had not alleged that the appellant were not in possession of necessary funds and the finding to the effect was beyond the scope of pleadings and not sustainable.
10. Ch. Imdad A.I, learned counsel for the respondents defended the impugned judgment and decree of the Trial Court by arguing that from the facts and circumstances of the case and from the conduct of the appellant it as evident that they had abandoned their right under the agreement with was obvious from the fact that the suit was filed after about two years of the rescission of the contract by the appellants. The leaned counsel further submitted that the appellants did not possess necessary funds for payment to the respondents and, therefore, did not appear before the Sub-Registrar on the ate fixed for the purpose of execution of the sale-deed.
11. Having considered the arguments addressed at the bar and perused the record we are of the view that the impugned judgment and decree are not sustainable. It sands admitted on the record that out of the total amount of consideration of Rs. 3,26,000/-, the appellants had received a sum of Rs. 74,000/- as earnest money in addition of which another amount of Rs. 55,000/- was paid on 28.2.1982. Thus a substantial amount out of the agreed consideration stood paid to the respondent by the appellants. It is noteworthy that though there is an expressed stipulation in the agreement that in case of non-payment of Rs. 55,000/- on 28.2.1982, the respondent shall have a right to rescind was incorporated with respect to the payment of the remaining amount of consideration. It is thus clear that the parties themselves did not treat the date for last payment as an essential term of the agreement. Consequently the contract could not have been rescinded by the respondent on this ground in view of section 55 of the Contract Act.
12. The proposition that in the contract relating to immovable properties the time is not essence stands firmly established. (See Ghulam Nabi and others v. Muhammad Yaqub and others (PLD 1983 SC 344), Syed Arif Shah v. Abdul Hakeem Qureshi (PLD 1991 SC 905) and M/s. Aman Enterprises Sialkot v. M/s. Rahim Industries Pakistan Ltd. (PLD 1993 SC 292).
13. The following observations of the Supreme Court of Pakistan in the case of Mrs. Mussarat Shaukat A.I v. Mrs. Safia Khatoon and others (1994 SCM R 2189) are instructive and may be reproduced with advantage:- "It is open to the parties while entering in the agreement of sale in respect of an immovable property to provide that the time for performance of the agreement will be treated as essence of the contract. In such cases, if the parties seeking enforcement of the contract is shown to be in breach of the contract, the Court may in appropriate e to enforce the contract. However, in tt absence of a provision in the agreement to sell an immovable property that the time fixed for performance of the contract is to be treated as the essence of the contract, the time fixed for the performance of the contract is not treated as the essence of the contract. Therefore, specific performance of an agreement of sale relating to immovable property can be granted by1 Courts even after expiry of period fixed in the contract."
14. There is also evidence on the record in the form of admission of Hakim A.I DW.2, a close relative of the respondent, that with the amounts received as advance under the agreement, the respondent had purchased agriculture land elsewhere which shows that the respondents had derived benefit from those payments. On the other hand, there is nothing on the record to show as to what prejudice has been caused by the appellants to the respondent by non-payment of the remaining amount of consideration within the due date.
15. In M/s. Aman Enterprises, Sialkot v. M/s. Rahim Industries Pakistan Ltd., Sialkot and another (PLD 1993 SC 292) one of the grounds which prevailed with the Supreme Court for reversing the judgment of the High Court and decreeing the suit for specific performance was that the respondent had received a fairly substantial amount by way of earnest money.
16. Faced with this situation, the learned counsel for the respondent attempted to argue that the appellants had abandoned their rights under the contract and as Rich could not subsequently seek its specific performance.
17. This contention of the learned counsel cannot be accepted for various reasons; firstly, that the plea of abandonment was not raised in the written statement and secondly, that there is no evidence to sustain it. The only circumstance to which the learned counsel for the respondent referred -to was, delay in filing the suit for specific performance. In this behalf it was pointed out that the agreement stood rescinded by the appellants as far back as 13.1.1983 vide application Exh.D-3 while the suit. For specific performance was instituted on 16.2.1985.
18. We are not impressed with these contentions. Admittedly the respondent had already received substantial amount under the agreement and mere delay in filing the suit or silence on the part of the appellants lead to an inference of waiver or abandonment of the rights under the agreement.
In Mrs. Mussarat Shaukat A.I v. Mrs. Safia Khaton and others (1994 SCM R 2189) it was observed that:- "Delay simpliciter which is short of period of limitation prescribed under the law, is not enough to disentitle a plaintiff to the relief of specific performance If the delay, however, gives rise to inferences of abandonment or waiver of the contract on the part of vendee, or the vendor on account of delay changes his position in which the vendee acquiesced the specific performance may be declined on equitable considerations."
19. Again in Ghulam Nabi and others v. Seth Muhammad Yaqub and others (PLD 1983 SC 344) it was observed that delay in filing suit could not result in non-suiting the plaintiff when period of limitation is yet to expire. In view of the above legal position it was incumbent upon the respondents to have pleaded abandonment of the contract by the appellants in the written statement and them proved the same by leading some positive evidence from which abandonment or waiver could be inferred or at-least brought on record the prejudice, if any, which had been caused to them. On the other hand, as already observed, with the money already received under the agreement from the appellants the respondent had purchased immovable property elsewhere.
20. Ch. Imdad A.I, learned counsel for the respondent argued that even if the time was not of essence of the contract yet the appellants, were -bound to perform their part of the contract within a reasonable period as envisaged by section 46 of he Contract Act. As law by itself fixed a period of three years for filing suit for specific performance from the'date fixed in this behalf or refusal, as the case may be, it cannot be held that by filing a suit on the date when it was instituted, the appellants had acted with unreasonable delay.
21. Two things which weighed mainly with the Trial Court in coming to the conclusion that the appellants had defaulted in performance of their part of the contract were firstly, that the respondent had sent a telegraph Exh.D-2 to the appellants requiring performance of the contract and secondly, that the presence of the respondent/defendant in the Court premises was established by the application, Exh. D-3, which he made before the Sub-Registrar. From these facts it was inferred that the ,appellants did not possess necessary funds for payment and, therefore, did not appear before the Sub-Registrar.
22. As already observed, even if it to assumed that these findings were correct the suit could not have been dismissed on account of nonpayment of the balance amount of consideration on 13.1.1983 as the time for payment of this amount was not of essence of the contract. But on appraisal of evidence these findings are not borne out by the record. So f as telegram Exh. D-2 was concerned the appellants had denied having received it. The Incharge of the Telegraph Office appeared as DW. 1 to prove delivery of telegram. He, however, in his cross-examination stated that the was not in possession of the record of delivery of telegram which was lying in his office and as such he could not state whether telegram had been returned undelivered. In these circumstances, there was no warrant for assumption that the telegram stood delivered to the appellants. As regards application, Exh. D-3 according to the statement of Ahmad Khan, Retired Naib-Tehsildar he had simply marked the application to the Registration Clerk without passing any order. There is no endorsement by the Registration Clerk on the said application. What is surprising however, is that original application was produced by the respondents from his own possession, as if the document had indeed been presented to the NaibTehsildar it should be in the official record.
23. Coming now to the findings of the Trial Court that the appellants were not in possession of sufficient funds on 13.1.1983 the only reliance of the Trial Court for so holding was on the fact that according to the appellants they had generated the requisite amount through sale of their lands but sale-deeds Exh.D-4 to Exh. D-6, show that those sales were made in the year 1985 and as such the appellants could not claim that they were possession of the funds in the year 1983.
Unfortunately while coming to this conclusion the Trial Court omitted to consider that the sale- deeds Exh. D-4 to Exh. D-6 clearly recites that the entire consideration of those sales stood already paid to the appellants. This fact is further borne on by the statement of Muhammad Anwar Khan, who was vending in those transactions.
24. We are also unable to agree with the Trial Court that the evidence produced by the respondent was not worthy of reliance. On appraisal of the evidence we were of the view that the witnesses produced by the appellants were independent and their statements should have been preferred to that of the witnesses of the respondent who were interested. The reasons given by the Trial Court for discarding the evidence of the witnesses of the appellants are far from satisfactory. PW. 2 Muhammad Abdullah was a marginal with as of the document Exit. P-1. He categorically stated that he alongwith others had gone to the office of Sub-Registrar for having sale-deed executed but the respondent was not found there. PW. 3, Abdul Karim was Lambardar of the village. He also supported PW. 2 in this respect. His evidence was discarded by the Trial Court on wholly untenable assumption that though he claimed to he hereditary Lambardar but as his father was alive he could not be a Lambardar. Such an inference could not have been drawn without obtaining explanation from the witness. Pw. 4 Mushtaq Ahmad was a Councillor and deposed that the had accompanied the appellants to the office of the Sub-Registrar for having the sale-deed executed but they could not find respondent there.
25. ,Apart from the official witnesses, the other evidence produced by the respondent comprises of the statements of Waris A.I, DW. 3, Hamayar Khan, DW.4. So far as Waris A.I is concerned, according to his own statement he after selling his land in the village had migrated about five years ago to hang. He admitted his close friendship with Rana Riasat son of the respondent/defendant. On his own showing he was a chance witness and had no occasion to be present either at the time of execution of agreement for sale or thereafter when the sale-deed was to be executed. The other witness Hamayat Khan is highly interested as two sisters of the defendant/respondent are married to his two brothers and his son is married to the daughter of a sister of the respondent/defendant.
The Trial Court was, therefore, not justified in rejecting the evidence produced by the appellants are relying upon the statements of the witnesses of the respondent who were highly interested.