WAHID BUX BROHI J. -- This suit for recovery of Rs. 10,50,000/- is out com of a contract for sale of a house situated at Gujranwala Cantt. owned by defendant. Admittedly, defendant Brig. (Retd.) Ch. Muhammad Sharif offered to sell his house and the plaintiff Raja Riaz Ahmed agreed to purchase the same against sale consideration of Rs. 20,50,000/- out of which a sum of Rs. 50,000/- was paid as earnest money. It was agreed that a sum of Rs. 600,000/- would be paid towards consideration in the month of January, 1992 and the balance by 1st of May, 1992 and the house would be transferred to the plaintiff; and in case the-latter failed to pay the balance the earnest money would be forfeited. It is the case of plaintiff that besides earnest money he paid Rs. 500,000/- through a cheque on 1.2.1992 and another sum of Rs: 500,000/- through a cheque dated 29.5.1992.
According to him, the period of payment was mutually extended on the ground that the defendant had not been able to receive the sanction of the transfer of the said house in favour of the plaintiff from the competent authority. Again an amount of Rs. 20,000/- adjustable towards sale consideration was paid by plaintiff to Lt. Commander Tahir Abbas, son of the defendant, through a cheque dated 6.6.1992 under the instructions of defendant which was acknowledged by the defendant through a letter dated 2.6.1992. At one stage the plaintiff proceeded to Gujranwala to take the possession and make payment but the defendant allegedly slipped away, the plaintiff, therefore, came back. According to plaintiff, the defendant sold the house to another person for a sum cf Rs. 25,00,000/- on that the plaintiff protested against the breach of agreement with him and then requested the defendant to return his money. Ultimately, a settlement was arrived at between the parties for payment of the amount to the plaintiff in instalments of Rs. 20,000/- per month out of which defendant paid the first installment through cheque dated 3.12.1993 and thereafter no payment was made. He, therefore, filed this suit for recovery of Rs. 10,50,000/- with profit and costs,
2. The defendant, in his written statement, admitted the factum of agreement, sale consideration and receipt of Rs. 50,000/- as earnest money and the other terms of the agreement. According to him, the plaintiff failed to make payment of the agreed amount before 1.5.1992 and thereafter there was no mutual extension of time. He did not dispute the payment of Rs. 20,000/- to his son subject to adjustment against the balance of consideration. He asserted that despite his letter dated 2.6.1992 and telephonic and other messages the plaintiff failed to perform his part of obligation of paying the balance amount of Rs, 9,80,0001- as he was involved in Taj Campany scandal being one of the Directors. However, after waiting or a long time he sold the house to another party in May/June, 1993. Thereafter, he refunded an amount of Rs. 20,000/- paid to his son by plaintiff, as requested by plaintiff himself. He took other legal pleas that the plaintiff had no cause of action and this Court has no territorial jurisdiction to entertain and adjudicate this cause of action as the property is situated at Gujranwala, the agreement was arrived at and payments made at Gujranwala and the defendant actually and Voluntarily resides/carries on business/personally works for gain at the said place. He-also took the plea that the transaction had attained finality and could not be reopened.
3. The following issues were settled on these pleadings:-
(i) Whether plaintiff has any cause of 'action?
(ii) Whether this Hon'ble Court has territorial jurisdiction in entertain and try this suit?
(iii) Whether any equipment was arrived at- between the parties at Karachi for refund of Rs.
10,70,000/- and payment of Rs. 20,000/- vide Cheque dated 4.12.'1993 was the first payment?
(iv) Whether the plaintiff is entitled to any relief prayed by him?
(v) What should the order/decree be?
4. On these issues the plaintiff, Raja Riaz Ahmed examined himself and produced the original letter dated 7.1.1992, counterfoil of the cheque for Rs. 500,000/-, photo-copy of cheque for Rs. 500,000!-, original letter dated 2.6.1992, copy of pay-inslip in respect of Rs. 20,000/-, copy of letter dated 28.5.1992 and copy of his own letter dated 19.6.1992. On defendant's side the defendant examined himself and produced copy of sanction for transfer of the house and letter dated 22.9.1994 on the same subject. He also examined his son Tahir Abbas as 'a witness.
5. I have heard learned counsel for parties and perused the pleadings and evidence on record.
6. Learned counsel for plaintiff . submitted that the defendant has admitted receipt of the amount and since a part of the consideration, that is, a sum of Rs. 20,000!- was paid by the plaintiff -to the son of defendant at Karachi and then there was an oral agreement at Karachi for refund of the entire sale consideration the cause of action, therefore, partly arose at Karachi and this Court has territorial jurisdiction to adjudicate the claim of recovery of money. He relied on Agricides v. Ali Agro (1989 CLC 58 (Kar.)], Muhammad Yasin v. Muhammad Abdul Aziz (PLD 1993 S:C. 395) and Shahzad Humayun. v. Muhammad Abram 41991 M LD 530) in support of his contention. He submitted that the admitted document being letter Of the defendant dated 2.6.1992 shows that he accepted the payment Of Rs. 500,000/-through cheque even after the cut off date i.e. 1.5.1999 and thereby the time for payment stood extended by consent. Secondly, the question of forfeiture of any amount does not arise and this Court has jurisdiction to decree the suit for the admitted payment made to the defendant. Learned counsel for defendant argued that within the meaning of the point involved in issue No. 3. No written agreement between the parties for refund of Rs. 10,70,000/- could be produced and the plaintiff could not examine any witness to support the plea of oral agreement on this point, the plea of plaintiff taken in para 10 of his plaint has, therefore, failed. Secondly, this Court has no jurisdiction as the original contract was entered into at Gujranwala, the house was situate at Gujranwala and the defendant resides there. He further contended that the sale could not be completed and the amount of Rs. 20,000/- was returned to plaintiff which he had paid to son of the defendant and for the rest of the claim no cause of action has accrued.
7. The territorial jurisdiction of. this Court to try and adjudicate this suit is, thus, the most vital question. The issue No. 2 has accordingly been framed on the point:. whether this Court has territorial jurisdiction to entertain and try the suit, while issue No. 3 has been struck on the point whether an agreement was arrived at between the parties at Karachi for refund of Rs. 10,70,000/- and that 'pursuant to such agreement Rs. 20,000/-was paid through cheque dated 3.12.1992 as the first-installment.
8. The back-drop of the case as reflected in the averment made Fri the pleadings-plaint and written statement, gives an impression as if the parties must be labouring upon the specific performance of the contract relating to sale of the house, but in fact what has been clearly stated in the plaint is that the plaintiff wants to recover his money which he paid to the defendant pursuant to the said contract which ultimately could not materialize and came to an encl.:This is simply a suit for recovery of money in which the plaintiff's status is that of creditor and the defendant, debtor, and the performance of contract is totally alien to it, moreso when both parties have conjointly demonstrated their unanimous conduct that they were not interested in completing the contract of sale of house as the house has already been sold to another person. As regards the cause of action I would disagree with the learned counsel for defendant that since the original contract for sale of the-house was entered into at Gujranwala, the defendant resides and carries on work at Gujranwala the subject-matter, namely the house is also situate at Gujranwala, the Courts at Gujranwala alone would have jurisdiction on the subject- matter in hand. Indeed, legally speaking, the cause of action in this suit spreads over the component facts relating to payments of moneys made by the plaintiff it several times as averred in the plaint and it would be uncanny to refer to the pleas taken in the written. statement by the defendant and assign importance to the same while finding out the bundle of facts that constitute the cause of action.
9. Learned counsel for plaintiff rightly argued that. irrespective of the provisions of Section 20(c).
CPC this Court has jurisdiction to entertain a suit if the cause of action has partly arisen at Karachi.
The perspective is quite simple if the facts alone are assessed, but it is essential to discuss the legal aspect of the contention raised by the learned counsel for plaintiff. It has been plainly held by this Court in Agricides v. Ali Agro (supra) that the provision of Section 120, CPC does not in any way restrict the jurisdiction of the High Court, but on the contrary, it enlarges the same by removing restrictions imposed by Sections 16, 17 and 20 of the Code of Civil Procedure on original civil jurisdiction of this Court. It was held in the cited case that this Court was competent to entertain a suit and could assume jurisdiction on original side if part of the cause of action accrued within its jurisdiction. The principle laid down in this 'case was followed by this Court in Suzuki Motorcycle Pakistan Ltd. v. Tariq Jawed (2000 CLC 1093). Respectfully, following the above, I would hold that this Court will have jurisdiction to entertain a suit:for recovery of money if part of cause of action has arisen at Karachi. A,s far the ,part of cause of action is concerned the principle laid down in Muhammad Yasin v. Ch. Abdul Aziz (PLD 1993 SC 395) provides enormous guidance on -the subject. 1992 CLC 2047 is also relevant on the point.
Reference may also be made to the observations. made in Abdul Ghafoor v. Natural and Bewerages Ltd. (2001 YLR -3243) wherein rt has been held that even a fraction of cause of action is a part of cause of action.
9. In this context, in the first instance, it would be relevant to refer to the significant admissions made by the defendant in his cross-examination on crucial points which are reproduced verbatim:- All the payments were made to me at Gujranwala. I see Ex.5/1 and state that I had signed and issued this receipt. The' first payment after the token money under the aforesaid receipt was Made on 1st/2nd February, 1992. This payment was made to me in the shape of the bank draft, which was drawn at Muslim Commercial Bank. Gujranwaia The next payment was made to me on 29th May, 1992, When the first payment was made the sale agreement between me and the plaintiff I was entered into.
It is correct to suggest that Rs. 500,000.00 were sent from Karachi by the plaintiff which I acknowledged. It is also correct to suggest that Rs. 20,000.00 was paid by the plaintiff to . my son at Karachi. It is correct. to suggest that the plaintiff paid to me a sum of Rs. '1,070,000.00 out of the total 'sale consideration. Upto the 1st of May, 1992; I had not received the sanction from the Military Estate Office for sale of the said property. I see Ex.516. it is a letter written by me.
10. In the instant case it is quite comprehensible from the facts of the case that for the purpose of recovery of money the plaintiff has assumed the status of creditor and the defendant as debtor. If an approach is to be made to the question of jurisdiction bearing in mind the principle that the debtor .must seek/follow the creditor, then there can be no hesitation to -hold that the plaintiff could file the suit in this Court. Nevertheless, as regards the factual aspect that part of the cause of action has partly arisen at Karachi the admission of defendant him self as reproduced above is sufficient. He has admitted that the plaintiff has, in all, paid to him a sum of Rs. 10,70,000/-.
According to defendant a sum of Rs. 500,000/- was sent to him from Karachi, and that 'a sum of Rs.
20,000!- was paid by the plaintiff to his son at Karachi. In view of these admissions the cause of action accrued, partly at Karachi when the plaintiff made payment of Rs,. 20,000/- to defendant's son and also when he remitted Rs, 500,000!- from Karachi which the defendant has admittedly acknowledged.
As regards the second component of the question of territorial jurisdiction as embodied in issue No. 3, the plaintiff's case is that subsequently an oral agreement was made at Karachi when the defendant had been to Karachi and it was mutually decided that the defendant would refund the amount in the instalments of Rs. 20,000/- per month. It was towards this understanding that the defendant paid the first installment of Rs. 2,000!- in him through his son. On the other hand, the defendant has claimed that an amount of Rs. 20,000/- earlier paid to his son was beyond the scope of the remaining amount of Rs. 10,50,000/- to be forfeited by him, therefore, he refunded the same. In any manner return of Rs. 2,000/- is admitted by the defendant. The defendant has denied the factum of alleged agreement made at Karachi for refund of the amount and in this view of the matter the burden lay on the plaintiff to furnish cogent and trustworthy evidence to prove that they had reached such agreement, and it goes without 'saying that the Plaintiff could not produce any other evidence oral or documentary except his word recorded in the examination-in-chief. This version was equally controverted by the defendant in his evidence saying that he has neither been to Karachi in this connection nor such an agreement was entered into. Thus the version being word to word it cannot be said that the plaintiff produced such evidence as to establish his plea beyond doubt. Nevertheless, irrespective of such oral' agreement the discussion earlier made is sufficient to conclude that this Court has jurisdiction to adjudicate upon the claim of plaintiff as far the recovery of money is concerned. Both the issues are answered accordingly.
12. The issues Nos. 1, 4 and 5 are taken up together. The issue that plaintiff has no cause, of action is based on the plea taken in the written statement that the plaintiff is not entitled to refund of any money as per terms of .the agreement. Now, as regards the terms of agreement the defendant has spoken of a new written agreement but according to him its original remained with plaintiff. The plaintiff has denied this allegation. However, both parties have commonly stated that initially, the terms of the contract were embodied in the letter dated.7.1.1992 produced as Ex.5/1. This letter states that the defendant sold his house bearing No. 171, Defence Officers Housing Society, Gujranwala Cantt. to the plaintiff for a sum of Rs. 20,50,000/- out of which a sum of Rs. 50,000/- was paid as earnest money and he promised to pay Rs. 600,000/- by January, 1992 and that the total payment would be made upto 1st of May, 1992 and then the property would be transferred, but in case within the stipulated period the consideration was not paid the earnest money would be forfeited. The defendant in view of these recitals has taken the plea in the written statement that since the defendant did not make the payment within time the entire amount paid by him stood forfeited. As against this the plaintiff has relied on the other admitted documents namely letter dated 2.6.1992 Ex.5/4 and letter dated 28.5.1992 Ex.5/6' both these letters are on the letterhead of defendant and are addressed to the plaintiff. The letter dated 28.5.1992 starts with regrets that the .plaintiff had come to his (defendant's) house but he could not meet the plaintiff and that no talk could be made on telephone, however, he was able to complete the documents of the house by 10th of February and has forwarded the same to MEO, Kharian Cantt. and that he had himself gone to Kharian on 14th of May and from there he has got the papers dispatched to Lahore. He has further written that within a week he would go to Lahore and the papers would then be forwarded from Lahore to Rawalpindi, and that he would inform the plaintiff. In the second paragraph he has again asked the plaintiff to remit some amount to him as far as he could conveniently, and this amount may be sent through cross-cheque. The letter ends with greetings and Salams to family member's of the plaintiff. Contents of this letter demonstrate cordial relations between parties and manifestly support the. plea of plaintiff that by mutual consent the cut off date for payment of sale consideration was extended.
13. Again, in the other admitted letter dated 2.6.1992 (Ex.5/4) the defendant has acknowledged receipt of the letter of plaintiff alongwith cheque of Rs. 500,000/-. He has further said in this letter that he would deposit the cheque in his account. In the second paragraph he has written that the papers of the house had been completed as he had checked up the position from Rawalpindi and he would be receiving the sanction within a day or two and the plaintiff may check up on telephone within 4/5 days. In the third paragraph it is mentioned that the letter is being sent to the plaintiff through defendant's son Major Shahid Abbas. A request is added that a sum of Rs. 20,000/- be paid to defendant's younger son Lt. Tahir Abbas of Pakistan Navy through cheque. He has explained that he was to send the amount from Gujranwala but then he thought that the plaintiff may make this payment which would be adjusted towards the sale consideration. The letter ends with usual greetings indicating harmonious relations as before. In this letter it has also been expressed that the 'plaintiff should come for observing written formalities of the matter. From these written documents it is abundantly clear that the terms of agreement dated 7.1.1992 stood mutually and by consent relaxed and time extended. Nothing is, however; clear from these documents as to what was the final date for payment. In the circumstances the defendant was not justified in giving out that the plaintiff committed breach of the contract entitling the defendant to forfeit the entire amount, and that on that score the plaintiff had no cause of action.
14. Initially, this plea of, the defendant suffers from an inherent infirmity as a' party is not permitted to forfeit the sale consideration unless such terms are specifically recorded in the agreement itself. .The document dated 7.1.1992 at the most speaks of forfeiture of earnest money and there is no such condition as to entitle the defendant to usurp the major portion of sale consideration paid during the intervening period. Legally, the defendant was not justified in forfeiting the amount paid to him when the terms of the agreement stood relaxed from time to time through the written and admitted documents; besides, there was no agreement for forfeiture of the payments made towards sale consideration.
15. There is yet another weak point in the matter. The defendant had not completed the formalities and had not obtained sanction order till he received such intimation through documents produced by him (Ex."6/1) which was issued by Military Estate Officer, Kharian Circle, Kharian Cantt on 21st June, 1992 enabling the defendant to transfer the lease . hold rights in his house to the plaintiff.
Indeed till then the defendant had no permission to transfer the lease hold rights and was absolutely not in a position to accomplish the terms of the agreement (Ex:5/1). In order to meet with the defendant took a new plea at the time when his evidence was recorded, much against what was stated by him in his written statement. He came out with altogether a different and inconsistent story about the terms of the agreement. According to him the first payment, after the token money, was made on 1st or 2nd February, 1.992 and after the first payment the sale agreement was reduced to writing the original whereof remained with the plaintiff. This version of the defendant does not find mention in the documentary evidence. namely, the admitted letters.
Even otherwise this version referring to original, indicates that the copy or duplicate was also prepared; if it was so he could have produced the duplicate but he has failed to do so. The defendant has added that the new terms. of agreement were that upon the payment of earnest money the defendant would pay Rs. 10,00,000/- before the registration of sale-deed and the balance of Rs. 10,00,000/- at the time of Registration of the Sale-Deed and the registration was to be effected upon the receipt of sanction by the Estate Officer and the cut-off date was fixed as 30th July, 1992. He. has further 'deposed that' in the event, the payment was not made by the due date 'the entire amount paid by the buyer was to be forfeited and in the event of default on the part of defendant he had to pay double the amount paid by the plaintiff. He has produced the certified copy of the sanction Exh.6/1 but he-has failed to produce the copy or duplicate of the agreement.
16. The above new stand is wholly unbelievable for the simple reason that (sic) and such terms were incorporated in a new agreement he could have conveniently pleaded the same in his written statement contents whereof were solemnly affirmed on 6.11.1994. It seems. this is a totally after- thought and concocted story because upto the filing of written statement he all along reproduced and emphasized upon the terms of agreement as incorporated in the letter dated 7.1.1992, there is no indication, at all, in respect of the second agreement either. The defendant in this manner has distorted his credibility. His plea that he was entitled to forfeit the entire amount of Rs. 10,00,000/- being an after-thought story is not trustworthy as also unjust. Nevertheless. the legal infirmity mitigating against this plea that under the settled law no evidence can be led or looked into in support of a . plea which has not been expressly taken in pleadings. Reference in this regard may be made to anyameen v. Hakim (1996 SCM R 336), Kamran Butt v. Iftikhar Ahmed 1PLD 1941 Karachi. 417). M.C.B. Ltd, v. Ahmed Saeed Kirmani (1991 CLC 140) and Fairland. Export Syndicate v. Bengal Oil Mills Limited (PLO 1970 Karachi 125). The defendant's plea on the whole fails. The plaintiff had certainly cause of action for recovery of the amount paid by him to the defendant.
17. No doubt it is not clear as to at what point of time the agreement between the parties came to an end but there is no specific evidence to indicate in so many wards the situation (sic) of the. parties be held responsible (sic) for conduct, Moreover, it is - also not an issue in this case, these aspects were dilated upon simply because the defendant has set up the plea that he was entitled to forfeit entire amount in terms of a collateral agreement entered into the' parties which he utterly failed to prove. As against this, from the letters Exhs.6/1 and 6/2 it is proved that the terms of agreement and time of payment stood relaxed by consent. In consequence thereof it can reasonably be concluded that even the initial terms for forfeiting the earnest money stood relaxed.
On the whole the defendant was not justified to withhold the amounts paid to him. He has in clear and categorical terms admitted in his evidence that he has received an amount of Rs. 10,70,000/-.
At the best, evidence has come on record that a sum 'of Rs. 20,000/- paid back to the plaintiff. The defendant is now liable to refund the remaining .amount of Rs. 10,50,000/- to the plaintiff.
18, In view of the above discussion the suit is decreed with costs for the payment of Rs. 10,50,000/- by the defendant to the plaintiff.