' ANWAR ZAHEER JAMALI, J.---This appeal under section 21 read with section 18 of the Banking Companies (Recovery of Loans, Advances, Credits and Finances) Act, 1997 is directed against the order dated 30-4-2001 passed by the learned Single Judge of this Court whereby official assignee's reference dated 14-4-2001 in Suit No,114 of 2000 was allowed and the application (C.M.A. No,2657 of 2001) filed by the appellant/auction-purchaser was dismissed.
2. Relevant facts forming background of this appeal are that in response to an advertisement published in various newspapers inviting sealed tenders for sale of approximately 3693.637 metric ton of Basmati Rice on "as is where is" basis the appellant submitted their offer at Rs,9,000 per metric ton on 31-1-2001. Offer given by the appellant was placed before Court under reference dated 7-2-2001 and was accepted by Court vide its order dated 14-2-2001. Such intimation calling upon the appellant to pay the balance sum and to take the delivery of rice was received by the appellant on 17-2-2001, but not only they failed to deposit the balance amount and lift the rice but also in collusion with National Bank of Pakistan, Thana Bazar, Arifwala, they managed to stop the payment of pay order in the sum of rupees one million delivered by them to the respondent No,1 towards earnest money on various pretexts. However, upon reference to Court dated 19-3-2001, later on this amount of rupees one million was received by respondent No,1 in terms of order dated 27-3-2001 passed by this Court. Thereafter, official assignee submitted another reference in the Court on 14-4-2001, seeking order for forfeiture of earnest money deposited by the appellant and permission to invite fresh tenders through advertisement. In the meantime the appellant also submitted an application under section 151, C.P.C. Before the Banking Court being C.M.A. No,2657 of 2001, praying therein for refund of his earnest money. Precisely the ground urged in the application was that as per the test certificate dated 24-2-2001, in respect of samples of rice obtained by him same were not Basmati Rice, therefore, due to non-lifting of rice and non-payment of balance amount the appellant cannot be penalized.
3. By impugned order reference dated 14-4-2001 was allowed and C.M.A. No,2657 of 2001 was dismissed. By learned Single Judge in Chambers for the following reasons:-- "I have considered the contentions raised by the learned counsel for the parties. The applicant inspected the store of rice on 22-1-2001, took the sample and submitted bid in response to the public notice for sale of Basmati Rice on 'as it is where it is' basis. As a prudent man, he should have obtained the Laboratory test before submission of the bid, which he failed to do so. Since the sale was on 'as it is where it is' basis and the sample was taken by the intended bidder, before the submission, his tender has been accepted by the Court, at this stage the plea raised by the applicant/auction-purchaser that it was not the same commodity which was inspected by him, holds no ground. Consequently, the application is dismissed. This is the second attempt of the auction-purchaser to resile from the contract, one by filing suit before Arifwala and the second through this application. The application is dismissed. Consequently, official assignee's reference is allowed as prayed with further direction to examine the matter for filing a criminal complaint against the auction-purchaser in a Court of law."
4. We have heard Mr. Tasawar Ali Hashmi, Advocate for the appellant. He reiterated the same facts and urged that the appellants were not liable for forfeiture of their earnest money as the rice sold by the official assignee through sealed tenders, labeling it as Basmati Rice, were not Basmati Rice as evident from the laboratory test certificate dated 24-2-2001. He further, urged that in such circumstances appellant cannot be saddled with the liability of forfeiture of his earnest money in the sum of rupees one million. In support of his arguments Mr. Hashmi referred sections 12, 15 and 17 of the Sale of Goods Act and also relied upon the following cases:--
(1) Province of West Pakistan v. Messrs Mistri Patel & Co. And another PLD 1969 SC 80;
(2) Fand Munir v. Tehsil Government, Tehsil Phalia, District Mandi Bahauddin through Tehsil Nazim, etc. 2002 CLC 1593;
(3) Ch. Muhammad Ashraf v. Punjab Privatization Board through Secretary, Government of Punjab and another 2002 M LD 550.
5. Conversely, Mr. Mansoor-ul-Arfin, learned counsel for the respondent No,2, contended that in the advertisement inviting sealed tenders for sale of Basmati Rice it was specifically mentioned that such offer was on "as is where is" basis and for this purpose an inspection was allowed to the interested parties before submission of their offers, from 10-00 a.m. To 1-00 p.m. On 22-1-2001 i,e, 5 days before the last date of submitting sealed tendeRs, Not only this but samples of Basmati Rice were also supplied to all the interested parties including the appellant at that time and in such circumstances the claim of the appellant based on self-managed test certificate dated 24-2-2001 is nothing but an afterthought to wriggle out from the transaction. He lastly referred to last paragraph of the impugned order, reproduced above, to show that the appeal is without any merit and is liable to be dismissed.
6. Respondent No,1 in his written reply dated 11-8-2001 disclosed relevant facts about the proceedings before him and stated that the appellant had given their offer on 31-1-2001 (three days after expiry of last date of inviting sealed tenders) after due inspection and taking samples of Basmati Rice. They never objected to the quality of the rice before acceptance of their offer by the Court on 14-2-2001, which fact was communicated to them on 17-2-2001. Further the appellant firstly played mischief by arranging non-encashment of their pay order in the sum of Rs,1.00 million drawn at National Bank of Pakistan, Thana Bazar Arifwala, on various pretexts and thereafter as a last recourse they moved the Court for refund of their earnest money. In paragraph 9 of his reply respondent No,1 also gave details of subsequent proposal given by the appellant vide their letter dated 3-5-2001 to show the conduct of the appellant. In paragraphs 14 and 15 of the reply respondent No,1 gave details of subsequent offers and finalization of transaction of sale of rice which caused loss of Rs,14,77,455 to the respondent No,2 on account of appellant.
7. We have heard the arguments advanced by the learned counsel, perused the material available on record and also other material placed before us by respondent No,1 at the time of argument.
8. The perusal of case record reveals that the offer of sale of Basmati Rice through advertisement in various newspapers was with clear condition that such offer was on as is where is" basis. Not only this but on 22-1-2001 specific time viz. 10-00 a.m. To 1-00 p.m. Was fixed for the purpose of inspection of Basmati Rice by all intending buyers who wanted to submit their sealed tendeRs, It has not been denied by the appellant that even samples of Basmati Rice were supplied to all the interested parties though it was not contemplated in the advertisement. Obviously, the reason was that parties may satisfy themselves in all respect before submitting their sealed tenders/offeRs, It is pertinent to mention that despite all these facilities the appellant did not submit their sealed tender uptil the last date fixed for this purpose i,e, 27-1-2001, but they subsequently gave their offer on 31-1-2001. Even two weeks thereafter when the offer was accepted by Court on 14-2-2001 the appellant did not object to the quality of rice. It was only after the letter of official assignee dated 17-2-2001, calling upon the appellant for payment of balance sum of Rs,3,22,42,733 that the appellant set up the pretext of poor quality of rice (not Basmati Rice) based on the alleged test certificate dated 24-2-2001. Perusal of this test certificate reveals that report as to the quality of rice was provided by the laboratory on the next day of receipt of sample in the laboratory. There is no iota of explanation from the appellant side that why after obtaining samples of rice from respondent No,1 and before giving their offer the appellant, if at all they were interested in this exercise, could not get it tested from laboratory. Moreover, there is nothing- before us to hold that the said test certificate dated 24-22001 produced by the appellant relates to the same samples of rice which were taken by the appellant much before submitting their offer to the respondent No,1 (official assignee), who has been undertaking such exercise from time to time as an officer of this Court. There is hardly any need to observe that the official assignee has no personal interest in the matter as he will gain no personal benefit due to forfeiture of earnest money of the appellant. Thus no mala fide, malice or ill-will can be attributed to him.
9. Besides, it will not be out of place to mention here that phrase "as is where is" commonly used in such type of transactions though would not, ipso facto, absolve the seller of his own moral commitment, expected fair play and would not protect any misstatement or concealment of material facts on his part, but at the same time it has its own meaning, significance and import in the field of commercial activity as it warns customers/buyers to be wary, prudent and to act at their own risk while giving their offer or entering into a transaction. In the given circumstances, if the appellant acted in a negligent, imprudent and irresponsible manner then they have to bless their own stars, no fault can be attributed to the respondents.
10. The perusal of impugned order further goes to show that the same is well reasoned and speaking order which is based on proper appreciation of material placed before the Court.
Moreover it has not been disputed before us by the appellant that due to their failure respondent No,2 sustained loss of Rs,14,77,455 detailed in paragraph 15 of the reply submitted by the respondent No,
1. In such circumstances order for forfeiture of earnest money paid by the appellant is in conformity with the relevant provisions of law and needs no interference in appeal.
11. In the facts and circumstances discussed above, we find that the provisions of law referred by the learned counsel for the appellant and also the case-law referred by him are of no help to the case of the appellant.
12. Foregoing are the reasons for the short order passed in this appeal today, whereby the same was dismissed in limine.