' GHULAM RABBANI, J.--- This intra-Court Appeal calls in question a decree dated 5-5-1997 passed by learned Single Judge of this Court against appellant for an amount of Rs, 12,27,000 (Rupees twelve lacs twenty-seven thousand) with interest at the rate of 14% per annum from 15-7-1994 with costs of the suit.
2. Precisely stated, the respondent/plaintiff instituted a suit for specific performance, injunction and damages against the appellant/defendant No,1, and also against Mr. Nadir Ali Markhiani, Mr. Mazharul Haque, the Managing Director and the Director of S.I.T.E., and the Ministry of Industries, Government of Sindh as defendants Nos.2 to 4.
3. The case of respondent is that the appellant through its Secretary entered into an agreement dated 7-7-1994 for purchase of his land measuring 45-18 acres and consisting of Serial Nos.110, 118, 130 and 134, situated in Deh and Taluka Kotri, District Dadu, to the appellant for a consideration of Rs,27,27,000 (Rupees twenty-seven lacs twenty-seven thousand) viz. At the rate of Rs,60,000 per acre.
4. Pursuant to the aforementioned sale agreement an amount of Rs,15,00,000 (Rupees fifteen lacs) was paid to the respondent by way of cheque and thereafter, nothing towards consideration, was paid despite repeated requests including the one through a letter dated 21-7-1999 issued by the respondent. The appellant, however, sent on 15-9-1994 a reply to the respondent through a post dated letter, dated 2-10-1994 to the effect that farther action would be taken in the matter after the Secretary, Government of Sindh Industry Department would take final decision. This letter was, later on withdrawn when the respondent reacted instantly on receipt of said letter, insisting for payment of balance amount of consideration and for finalizing the transaction. He also sent a legal notice, dated 5-11-1994 to the Managing Director of the appellant which was evasively replied. Subsequent to that all the efforts taken by the respondent to this effect also failed to complete the transaction.
5. Further, the case of the respondent/plaintiff is that his land with sugarcane, vegetable and other crops located adjacent to the S.I.T.E. Area was damaged due to release of refuse water of S.I.T.E.
Area causing him losses of Rs,10,000 (Rupees ten thousands) per acre. He, therefore, claimed Rs,3,00,000 (Rupees three lacs) as damages with interest at the rate of Rs,20% per annum.
6. It may be mentioned that during pendency of suit, the Ministry of Industries and Mineral Development Government of Sindh, was deleted from array of defendants by an order, dated 1-2- 1996. The appellant has also not made the other remaining defendants as party to this appeal.
7. The appellant and defendant No,2 contested the suit and filed written statements. Both of them admitted the execution of agreement, dated 7-7-1994, quantum of consideration and part payment of Rs,15,00,000 (Rupees fifteen lacs) to the plaintiff/respondent. They, however, took a plea that since the price was of huge amount the matter was referred to its Board for reconfirmation when it was decided that the transaction be renegotiated with the plaintiff/respondent which fact was brought to latter's notice and that offer for renegotiation was open to resolve the matter amicably.
8. The abovesaid defendants further took a plea that there was a natural flow of rain water towards K.B. Feeder which by passage of time became the outlet for factories waste water and on complaint of the plaintiff the matter 'came under consideration of Provincial Ombudsman where an agreement, dated 7-7-1994 was arrived between the parties for purchase of plaintiff's land in question.
9. Beside the above, it was also averred by the above said defendants that the suit is not maintainable for the agreement in question was unenforceable at law till the decision of the Board as per Article of Memorandum of Association, who may direct acquisition of land.
10. Following issues were framed by learned Single Judge on the pleadings of parties:--
(1) Whether no cause of action arose to plaintiff against the defendants and suit is not maintainable as alleged in the written statement?
(2) Whether the defendants agreed to purchase the plaintiff's suit land (45 acres, 18 Ghuntas) through valid sale-deed, dated 7-7-1994 (Annexure "A")?
(3) Which party breached the sale-deed, dated 7-7-1994 and the terms and conditions mentioned therein?
(4) Whether the defendants can reject the sale-deed and direct the acquisition of the suit land as alleged in the written statement?
(5) Whether the plaintiff is entitled to the damages for withholding the performance of lawful sale- deed, dated 7-9-1977? If so, to what extent?
(6) Whether the plaintiff is entitled to interest at 20% per annum from 15-7-1994 i,e, after expiry of one week of signing and executing the deed on non-payment of balance amount of Rs,12,27,000?
(7) Whether the plaintiff is entitled to relief prayed in the suit?
(8) What should the decree be?
11. Plaintiff examined his attorney who stated the case as per plaint and, beside other documents, produced power of attorney as Exh.5-A, sale agreement as Exh.5-B, copy of minutes of meeting of Board of Directors of appellant, dated 23-6-1994 as Exh.5-C and copy of meeting, dated 8-6-1994 as Exh.5-D. The defendants also examined one D.W. Muhammad Bux Ariju, Chief Administrative Officer of Sindh Industrial Trading Ltd., defendant No,1, who also produced Memorandum and Articles of Association of Sindh Industrial Trading Ltd. As Exh.60-A.
12. Learned Single Judge, thereafter, heard learned counsel for the parties, considered their case in the context of the evidence adduced by them and passed the judgment and impugned decree.
13. We have also heard the learned counsel for the parties and have examined material available before us.
14. Learned counsel for the appellant mainly contended that the contract between the parties regarding sale of the land in question is not concluded but is only purported and price of the land is yet to be ascertained by renegotiation. According to him, the factum regarding determination of price is deducible from evidence of the respondent. To elaborate his point, he submitted that since the purchase price of the land in question was on higher side, the then Managing Director of appellant, namely, Mr. Nadir Merkhiani, within his competence in terms of clause (3) of Memorandum and Articles of Association of Sindh Industrial Trading Ltd., the appellant, lawfully referred the matter to Government and to the Board for consideration and the matter was referred back for holding negotiations to settle the rate of land. He submitted that no cause of action arose to the plaintiff and in the circumstances of the matter the suit was not maintainable. According to him, these points were not considered though pressed before trial Court. He placed reliance on a case of Province of East Pakistan v. Mian Muhammad Hossan PLD 1965 SC relevant page 14 and case of Messrs Ch. Brothers Ltd., Sialkot v. Jaranwala Central Cooperative Bank Ltd. 1968 SCM R 804.
He also placed reliance on Halsbury's Law of England, Volume 44, para. 435 (page 3302) and also upon the case-law of May & Butcher Ltd. v. Regem, reported in All ELR (page 684) and viewed that in the circumstances decree of specific relief cannot be awarded hence the impugned judgment and decree are not sustainable in law.
15. On examination of material before us, we observe that the appellant while mentioning the amount of consideration and mode of its payment has admitted the execution of agreement, dated 7-7-1994 in para.2 of written statement filed by it and the respondent No,2. The relevant portion is reproduced for the sake of convenience, as follows: "Upon the plaintiff's complaints that this waste water passed through and was deleterious to his agricultural land in the vicinity, the matter finally came up before the Provincial Ombudsman through the plaintiff's offer to sell his lands to defendant 1, photocopy of the said offer already filed, and it was decided by them in due course, to buy up the plaintiff's entire farm, as permitted by and subject to the terms of the said Memorandum and Articles as aforesaid, whereupon negotiations were conducted and an agreement, dated 7-7-1994 was signed for its purchase at Rs,60,000 per acre, for the total purchase price of Rs,27,27,000 out of which Rs,15,00,000 was paid to him forthwith, photocopy of Board Resolution, dated 23-6-1996 already filed."
D.W. Muhammad Bux Ariju, Chief Administrative Officer of Sindh Industrial Estate Trading Limited has, in his evidence, affirmed the above statement to be correct. It is noted from this statement that specific amount of consideration for sale of land was agreed in clear terms and even part payment, which is more than 50 per cent. Of total consideration, was made to the respondent, the seller. Examination of Sale Agreement (Exh.5/B) reveals that Rs,60,000 per acre and Rs,27,27,000 as total consideration for sale of land in question are very explicitly mentioned therein. The said D.W.
Has, in his evidence, admitted that the sale agreement was entered between the parties after complying with Rules and Regulations of Sindh Industrial Trading Estate Limited and that agreement (Exh.5/B) was final. He also stated in his evidence that Sindh Industrial Estate Trading Ltd. Has never any objection regarding any terms and conditions of the sale agreement excepting re-negotiations of rate but admitted in the same breath that there is nothing mentioned in the sale agreement about negotiation.
16. We observed, on scrutiny of the evidence, that the Board of Directors of Sindh Industrial Trading Estate Limited were cautious enough and took pertinent measures, as appears from what follows next, to settle the price of land per acre before approving the price in their meeting, dated 23-6- 1996.
17. The documents produced as Exh. 5!D in evidence reveal that as per decision, dated 18-5-1994 of the Board of Directors of Sindh Industrial Trading Estates Ltd. Mr. Nadir Ali Markhiani, Managing Director (defendant No,2) and Mr. Mazharul Hague, Tenant Director (defendant No,3) held a meeting on 8-6-1994 for the purpose of acquiring transfer of the land from Messrs Sakina Agricultural Farm, Kotri with a representative of the said farm. In the said meeting it was resolved as follows:-- "Resolved that it was mutually decided and agreed by both the parties to acquire the land measuring` 45acres, 18 Ghuntas for transfer to Sindh Industrial Estate Trading Ltd. At the rate of Rs,60,000 per acre from Messrs Sakina Agricultural Farm, Kotri is hereby approved and passed."
' It is also observed that a sub-committee consisting of abovesaid Directors, Secretary and others responsible officers of Sindh Industrial Trading Estates Ltd. In their meeting, dated 26-3-1994 had already taken a decision to recommend the rate of Rs,60,000 per acre vide Exh.5/C at page 35 of R&P. Subsequently the Board of Directors of S.I.T.E. Ltd. In their meeting, dated 23rd June, 1994 Exh.5/C approved the aforementioned rate per acre- as recommended by their abovesaid two Directors.
18. The other contention of learned counsel relate to referring the matter to Government and to the Board by Mr. Nadir Ali Merkhiani, Managing Director of appellant within his competence under clause (3) of Memorandum and Articles of Association for consideration and the order passed in pursuance of said reference. We have gone through said para of Memorandum and Articles of Associations of S.I.T.E. Ltd. Sub-clause (vii) of clause (1) of said para. 3 appears relevant and is produced below:-- "3 (1)(vii). If the Managing Director or either of the ex officio Directors so desires, he may ask that a resolution passed by the Directors be suspended pending a reference to Government in the appropriate department. On such reference Government may decide that the resolution shall have no effect or shall have effect in a modified form."
19. As far the reference to Government is concerned, the appellant/defendant No,1 neither took this plea in their, pleadings nor the D.W. Muhammad Bux Ariju has stated about the same in his evidence. Instead the plaintiff/respondent has, produced a letter, dated 10-8-1994 as Exh.5/G, which is written by the appellant to the respondent to inform him that the Secretary, Industries Government of Sindh has some reservations, therefore, further action would be taken after final decision by him. It is, however, noted that subsequent to the aforementioned letter the appellant wrote another letter, dated 2-10-1994 (Exh.5/I) informing the respondent that the earlier letter, dated 10-8-1994 be treated as withdrawn. Issuance of these two letters has neither been denied in pleadings nor the appellant has challenged the same in evidence. Thus, there is nothing to show that directives of Government, if any, for re-negotiation of rate of the land in question still hold field.
20. As far referring the matter to Board D.W. Muhammad Bux Ariju has, in evidence, stated that the matter was referred to the Board of Sindh Industrial Estates Trading Ltd. And the Board of Directors decided to renegotiate in order to get the rate reduced. It is, however, observed that the aforementioned exercise is not permissible under para.3 (1)(vii) of the relevant Memorandum and Articles of Association. Even otherwise, P.W. Salamatullah, who is attorney of plaintiff has, in his evidence, stated that he is not prepared to reduce the price of the land and enter in further negotiations with the defendants.
21. Learned counsel for the appellant has referred to Halsbury's Laws of England, Volume 44, para. 435, wherein, it is observed that where it is sought to enforce specific performance of a contract, the Court must be satisfied (1) that there is a concluded contract which would be binding at law if all proper formalities had been observed and in particular that the parties have agreed, expressly or impliedly, on all the essential terms of the contract; and (2) that the terms are sufficiently certain and precise that the Court can order and supervise the exact performance of the contract. Learned counsel has also referred to the case of May & Butcher Ltd. v. Regem reported in All England Law Reports (reprint) relevant page 684. In this case, Lord Warrington has observed that in his opinion, the decision of this case depends on the application of a well-known and elementary principle of contracts, which is that, unless the essential terms of the contract are agreed on, there is no binding and enforceable obligations. He has observed further that they have a document in the cited case which purported to be an agreement for the sale by one party to the other party of certain specified goods at a price to be hereafter agreed on between the parties. If that price is thereafter agreed then there is a binding contract within the principle to which he has alluded; each essential terms of the contract has then been agreed. If the parties failed to arrive at an agreement then the price has not been ascertained in the way in which the parties stipulated that it should be ascertained and there is, therefore, no binding agreement. In the instant case of specific performance D.W. Muhammad Bux Ariju has, in his evidence, stated categorically that the SITE never had any objection regarding the terms and conditions of the sale agreement except re- negotiations of rate. We have already discussed in detail, in the foregoing paras. That on the basis of rate approved by Board of Directors the agreement Exh.5/B, was reached between parties and even part payment of consideration was made to the plaintiff/respondent. As such the aforementioned references are of no assistance.
22. Next, learned counsel for the appellant has relied on the case of The Province of East Pakistan v.
Mia Muhammad Hossain PLD 1965 SC relevant page 14 and case of Messrs Chaudhry Brothers Ltd., Sialkot v. Jaranwala Central Cooperative Bank Ltd., Jaranwala 1968 SCM R 828 relevant page 832. In the first-mentioned case the dictum laid down is that on filing of the appeal, the entire matter becomes reopened and sub judice and had to be decided in accordance with law then prevailing.
There appears to be no cavil to the 'above proposition of law. We have already considered the case of the parties in the context of the evidence adduced by them. In the last-mentioned case, it was a matter under section 15(3) of Rent Restrictions Ordinance and the District Judge, Lahore being an appellate Authority dismissed the appeal in limine under Order XLI, Rule 11, C.P.C. Merely observing that since the plaintiff had produced the "returned" notices with the postal receipts and the envelopes thereof, the mere denial of respondent does not stand any chance in view of section 114 of the Evidence Act. In second appeal before the High Court it was urged that District Judge had no jurisdiction under subsection (3) of section 15 of the Ordinance to dismiss any appeal in limine but, High Court disagreed with this view. On an appeal by special leave against the said order, the Honorable Supreme Court did not approve what the District Judge had done and observed as follows:-- "In an original appeal or what is more commonly called the first appeal the first Appellate Court is the final Court of facts. Dismissal under Order XLI, Rule 11 of the Code of Civil Procedure of a first appeal is therefore not the general rules. If the facts are not simple or undisputed a first appeal is not generally dismissed in limine. But in the present case it appears to us that subsection (3) of the Rent Restriction Ordinance' clearly incorporates within it the rule that the Appellate Authority will not dispose of the appeal without first sending for the record of the case from the Controller and hearing the parties and further if necessary, making such further enquiry as it deems fit. The duty to call for the record in the first instance is imperative. It is difficult, therefore, to agree that under this subsection the Appellate Authority could dismiss an appeal in Ihnine."
23. In the instant appeal, both the parties have been provided opportunity of hearing. Their respective counsel have argued before us their case at length. We have also gone through the R&P called for from the lower Court, Therefore, in our view the case cited by the learned counsel for the appellant is not helpful to him.
24 Considering the above facts and circumstances we find that the learned Single Judge has rightly passed the decree in favour of the respondent. The appeal, therefore, merits no