Syed Mazhar Ali Shah Vs Qavi Ullah

* *m F.f

JUDGMENT SHEET

PESHAWAR HIGH COURT, PESHAWAR

JUDICIAL DEPARTMENT

C.M No.188-Pl202t with C.R No.83-P/2021 Syed Mazhar AIi Shah Vs Qavi Ullah

JUDGMENT

Date of hearing: t8.09.2023

Date of announcement: 02.10.2023

Petitioner (by): Mr. Muhammad Ismail Khalil. Advocate Resoondent (bv): Mr. Muhammad Fakhar-e-Alam Jhagra. Advocate. for respondent.

SYED ARSHAD ALI. J.- This Civil Revision is directed against the judgment/decree of learned Additional District Judge-XI, Peshawar dated 17.12.2020 whereby appeal of the petitioner against the judgmentidecree of learned Civil Judge-VII, Peshawar dated 14.12.2016 was dismissed.

2.Qavi Ullah the respondent on 13.04.2004 had filed a suit bearing No.59/6 seeking a decree for specific < performance of an agreement dated 22.03.2003. It was his claim in the plaint that an agreement was executed between the parties which was later placed on filed as Ex.

pwllz, whereby Syed }dazhar Ali shah the petitioner had acknowledged receipt of Rs.12,00,000/- (twelve lac)

as a loan from him payable within a period of six months.

It was further agreed that if Syed Mazhar Ali Shah the judgment debtor had failed to pay the said loan within the specified period, the property owned by him fully described in the said agreement would stand transfer to the decree holder Qavi Ullah.

3.On being noticed, the petitioner in his written statement had denied the execution of any deed and receipt of any amount of loan from the decree holder.

The divergent contention of the parties had led to the framing of issues by the trial Court and accordingly the parties were allowed to produce their respective evidence. Since it was the plaintifflrespondent burden to establish the execution of the deed dated 22.03.2003, therefore, he produced Sheiktr Muhammad Fahim as a PW-l who accordingly appeared before the Court and stated that he is the son of Sheikh Muhammad Saleem who was holding a valid license of deed writer, who at 4 the relevant time was reported dead. He confirmed the signature of his father on the deed which was exhibited as Ex.PW-llZ and also produced the copy of the register where the said deed was entered as Ex. PW-1/1. Qavi Ullah himself appeared before the Court as PW-2' He was not cross-examined on material part of his question

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in examination-in-chief. He was given positive suggestion confirming the existence of the deed, the manner and mode of receiving the loan amount etc. Syed Kamil Shah, the other witness of the deed appeared before the Court as PW-3 who has recorded his statement wherein he has affirmed the execution of the deed in his presence and receipt of an amount by the petitioner. The petitioner in the cross-examination has not contested his testimony as evident from the positive suggestion i.e.

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4.Syed Mazhar Ali Shah the petitioner did not opt to appear before the court rather he was represented by Ghulam Mustafa, as attorney before the Court as DW-1.

In his testimony he did not seriously controvert the contentions of the plaintiff. The learned trial Court vide judgment/decree dated 14.12.2016, decreed the suit of < the plaintifflrespondent to the extent of possession of plot measuring 01 Kanal and recovery of Rs.700,000/- (seven tac) whereas declined the claim for recovery of 12,00,000/- (twelve lac). The said judgment was appealed by the petitioner. The learned Appeal Court

dismissed the appeal of the petitioner vide impugned judgment dated 17 .12.2020.

5.The learned counsel appearing on behalf of the petitioner has mainly contented that during the pendency of the appeal, the appellant/petitioner had filed an application before the Appellate Court for summoning Muhammad Jehangir, the other witness of the deed and on the said application reply was sought from the decree holder but the learned Appellate Court has not decided the said application and thus the requirement of law is that the matter should be remanded back to the trial Court in view of the law laid down by the Apex Court in the case of (2008

SCMR 1259) and "Sultan Ali alias Sult

and others vs. Rasheed Ahmad and 45 others" (2005 scMR 1444).

6.I have perused both the judgments and with profound respect both are distinguishable for the obvious reasons that in the present case Muhammad Jehangir 4' though was a marginal witness to the deed dated 22.03.2003, however, in this regard the judgment debtor had not filed any application before the trial Court for summoning the said witness and even otherwise the summoning of the said witness would be of no help to the

petitioner because the deed upon which the decree holder was relying was established not only by the decree holder through his evidence but the petitioner could not controvert the testimony of those witnesses, thus, it would be altogether a futile exercise to remand the case to the Appellate Court for summoning Muhammad Jehangir, the other witness of the deed; hence this objection is ovemrled.

7.Moving on to the merit of the case. The bone of contention between the parties is the receipt of loan by petitioner from the decree holder and in this regard execution of the deed dated 22.03.2003 exhibited. The following are the main two contents of the deed.

i. Syed Mazhar Ali Shah, judgment debtor acknowledged the receipt of Rs.12,00,000/- (trvelve lac) from decree holder as a loan which was payable by 19.09.2003.

ii. Syed Maz},rar Ali Shah, judgment debtor had committed that in case of his failure to pay the amount by 19.09.2003, the property/land measuring 01 Kanal fully described in the deed would stand transferred to Qavi Ullah, decree holder only against an amount of Rs.500,000/- (five lac) and the remaining amount of Rs. 700,000/- (seven lac) would be payable by Syed lN.4.az}rar Ali Shah.

8.The evidence as stated above would clearly show .4 that the decree holder was able to establish the contents €7-' of the deed by producing confidence inspiring evidence and the positive suggestion given by the learned counsel representing petitioner regarding the execution of the deed and receipt of the loan by the petitioner. Therefore,

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the judgments/decrees of both the courts below to the extent that the plaintifflrespondent has established the agreement dated 22.03.2003 are not open to any exception.

9.However, the essential issue is that as per the contents of the agreement dated 22.03.2003, Syed Mazhar Ali Shah the petitioner has admittedly obtained an amount of Rs. 12,00,0001- as a loan which was payable by 19.09.2003. Through the said agreement he has created a charge on his property measuring 01 kanal with the undertaking that in case of his failure to pay the said amount by the due date, the charged/encumbered property would be appropriated to the

plaintifflrespondent against an amount of Rs.500,000/-.

Thus, the essential question is whether the plaintifVrespondent was entitled only to a decree for recovery of Rs.12,00,0001- the amount of loan received by the petitioner or the agreement stated above could be specifically enforced against the petitioner relating to the appropriation of property in favour of the plaintifflrespondent.

10.In this regard I have noted that neither of the parties has bothered to produce any evidence regarding the market pricelvalue of the said property nor the courts

have considered this aspect of the case while decreeing the suit for specific performance of the agreement.

11.Learned counsel for the petitioner in this regard has stated that the market price/value of the said property at this time is more than 10 million and since at the relevant time, the defendant was in need of the money, therefore, he had to create a charge against the said property.

12.The learned counsel representing the plaintiff has negated the said arguments that the market price/value of the said property is not that high.

13.Be that as it may, however, there is no evidence on record relating to the market price of that properfy, nevertheless, what has escaped the attention of both the courts below is the fact that the courts were dealing with the specific performance of the agreement which, prima facie, was vague in terms of the market price of the property and indeed the law is settled that the jurisdiction 7 of the court to grant relief of specific performance as provided under Section 22 of the Specific Relief Act, 1877 ("Act") is discretionary in nature and the court is not bound to grant such relief merely because it is lawful to do so. The court can, in appropriate circumstances, grant compensation as provided under Section 19 of the

14.The discretion to refuse the specific performance of an agreement and grant compensation has been very elaborately explained by the Apex Court in the case of "Liaqat Alt Khan and others

(PLD 2014 Supreme Court 506) in the following manner

" 18. A plain reading of above reproduced statutory provision leads to a definite conclusion that the relief of specific performance claimed by respondents Nos./ to 4 in their suit is, purely discretionary in nature and the Court is not bound to grant such relief merely as it is lawful to do so. At the same time, the discretion to be exercised by the Court shall not be arbitrary, but it should be based on sound and reasonable analysis of the relevant facts of each case, guided by iudicial principles and capable of correction by a Court of appeal. Moreover, in sub-paragraphs Nos i, ii and iii of section 22 (ibid) some instances have been given, where the Court can refuse to exercise its discretion to pass a decree for specific performance. A careful reading of these instances, which are self-explanatory, further amplify vast powers of the Court in the matter of exercise of its discretion for ordering spectfic performance or otherwise. When the above reproduced provision of law is read in conjunction with the case-lan cited at the Bar by both the learned Senior Advocate Supreme Courts, the things as regards powers of the Court in exercising its discretion, become even more clear that there is no two plus two, equal to four formula available with any Court of law for this purpose, which can be applied through cut and paste device to all cases of such nature. Conversely, it will be the peculiar facts and circumstances of each case, particularly, the terms of the agreement - between the parties, its language, their subsequent conduct and other surrounding circumstances, which will enable the Court to decide whether the discretion in terms of section 22 (ibid) ought to be exercised in favour of specffic performance or not' Besides, some well articulated judgments on the subject, have further broadened the scope of exercise of such discretion of the Court by way of awarding reasonable compensation to the parties, keeping in view the other surrounding circumstances, such as rate of inJlation, having direct bearing the value of suit property, inordinate

Act. For ease of reference both the provisions of law are reproduced as under.

19.Power to award compensation in certain cases: Any person suing for the specific performance of a contract may also ask for compensation for its breach, either in addition to, or in substitution for, such performance. If in any such suit the Court decides that specific performance ought not to be granted, but that there is a contract between the parties which has been broken by the defendant and that plaintiff is entitled to compensation for that breach, it shall award him compensation accordingly. If in any such suit the Court decides that specific performance ought to be granted, but that it is not sufficient to satis$ the justice of the case, and that some compensation for breach of the contract should also be made to the plaintiff it shall award him such compensation accordingly.

Compensation awarded under this section may be assessed in such manner as the Court may direct.

Explanation: The circumstance that the contract has become incapable of specific performance does not preclude the Court from exercising the jurisdiction conferred by this section.

22.Discretion as to decreeing specific performance: The jurisdiction to decree specific performance is discretionary, and the Court is not bound to grant such relief merely because it is lawful to do so; but the discretion of the Court is not arbihary but sound and reasonable, guided by judicial principles and capable of correction by a Court of appeal.

The following are cases in which the Court may properly exercise a discretion not to decree specific performance:- I. Where the circumstances under which the contract is made are such as to give the plaintiff an unfair advantage over the 4 defendant, though there may be no fraud or misrepresentation on the plaintiffs part. II. Where the performance of the contract would involve some hardship on the 5<' defendant which he did not foresee, whereas its non-performance would involve no such hardship on the plaintiff.

III. Where the plaintiff has done substantial acts or suffered losses in consequence of a contract capable of specific performance.

delay/ passage of time, and change in the circumstances or status of the subject property etc' To further amplify the aspect d exercise of discretion, here a reference may also be made to the language of section 19 of the Specifi'c Relief Act 1877, which reads thus:--

19.Power to award compensation in certain cases.--Any person suing for the specific performance -compensation of a contract may also ask for for its breach, either in addition to' or in substitutionfor, such perforrnance' If in any such suit the Court decides that specific performance -is ought not to be granted, but that there a contract between the parties which has been broken by the defendant and that the plaintiff is entitled io for that breach, it shall "o*prntation atv ard him compensation accordingly' If in any such suit the court decides that specific performtance ought to be granted, but that tt is not 'sujficient to satisfy the iustice of the case, and that ,i*, compensation for breach of the contract should alsi be made to the plaintiff, it shall award him such compensation accor dingly' Compensation qwarded under this section may be asseised in such manner as the Court may direct' Explanation.--'The circumstance that the contract his become incapable of specific performance does not preclude ilrc Court .f'om exercising the jurisiliction conferred by this section'"

15.Later,the Apex Court in the case of "Muhammad t, Q0t7

scMR 1696) after considering the various case law on the subject, has very comprehensively expounded the said proposition. Para-Z3 of the said judgment is worth

consideration which is reproduced as under' "23. The position that emerges is that specific performaice of an agreement dated.l2'12'1994 is trr,ing sought in 20ti t.t. zz years later when the uali ofThe property in dispute has multiplied eipone*ially. We- have been informed that value of ilrZ proprrty which at the relevant time was Rs'6'2 mflifon^ hai slcyrocketed to at least Rs'60 million which translates into a tenfold increase in the value we of the property. Even iffor the sake of argument' irrc io ogrri fo, a m-oment that a case for grant of

relief of specific performance was made out lregard;ng 'quZstion"of wniih *i hout various reservations)' the exercise of discretion in favour of the n spondeit would still need to be considered in ligit of the principle that such exercise of discretion iry leid to miscarriage ofiustice and an unfair i* advantage to the Respondent' It is axiomatic that one whi seelcs equity must do equity' We are not convinced that cinduct of the Respondent has ex that he has actedfairly facfe been above board and and equitably. In foct, in the present case' in our opiniin ail LquitiLs are squarely in favourcf !' f!9 ippellant and stacked against the Respondent iit", of the property has multiplied manifold' We solely are not convincid that the deal fell through on account of acts or omissions on the part of the nor Appellant. Ii would therefore neither be iust to force him to sell his property at such low pripu 'i prir, ,id bro, such a huge financial loss' This is on, ,roron (out of many) why the suit filed by t-he ^ Respondent seekfng diicretionary equitable- re^l(f must be dismissed' We are however mindful of t\e fact that a substantial amount belonging to the "Respondent has remained btocked since the year ZOOO wnich could have been utilized by him in other business activities or even if these had been could deposited with a commercial bank' the same in order have earned substantial returns. Therefore, tu ensure that the Respondent is also not putqward^ to a disadvantage, *, ,oniid'r it appropriate to adequate compensation' Cons-idering the rate of and keeping in return grrntrd by commercial banks and the mind tie depreciation in the value of money of Rupees Ten effect of in/tation, we find that 1 sum by intiUioi (over and abive refund of earnest money the Appellant and return of the entire amount accruals deposiied by the Respondent together with (i ony) * oit d c ons titut e ade quat e compens ation for 'i, iitpondent. This would in our opinion balance resolution the equities and represent aiust andfair of thi dispute between the parties'"

16.In the present case, the perusal of the evidence would show that the petitioner has not very ,/ seriously

4 contestedthecaseandfromtheevidenceitappearsthat though he had obtained a loan in 2003 but he could not

loan to the extent repay the same. The question that the ofRs.12,00,000/-wasavailedbythepetitionerandisstill

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payablehasbeendeterminedbyboththecourtsbelow and is also forthcoming from the evidence of the parties.

However,theappropriationofthelandmeasuringlkanal which is explained in the deed without first determining its market price would obviously give an unfair advantage to the decree holder and thus the court while

dealing with the specific performance of such contract

whichmayinvolvehardshiptothedefendantandgive unreasonable advantage to the plaintiff, to the said extent

there was could refuse its specific performance' However no ambiguity in granting a decree for recovery of Rs'

12,00,000/- as an outstanding amount' In such a

circumstances, the court has the ample power to

cannot be compensate the other parfy so that injustice donewithanyofthepartyandthebalanceismaintained betweenboththepartiestotheagreement.Itwouldnot be out of context to borrow apatagtaph from the case of

"it is L\aqatAli Khan wherein the Apex Court has held instrument well accepted principle of interpretation of an that for its proper comprehension and insight it is to be

readasawholeandwherettslanguageissimple'clearly then the understandable and capable of no ambiguity' intention of the parties to such instrument is to be

gatheredf,o*itscontentsalonewithoutadvertingtoany

other extraneous consideration and in normal course it should have precedence oyer any other option".

However, if the said attributes are not available in an

agreement and in case of any absurdity in terms of the

for agreement, the court is not bound to grant a decree specific performance of the agreement and the to the appropriate course would be to grant compensation other party.

17.In view of the above, this petition is partially allowedandthejudgments/decreesofboththecourts below are modified as under:-

i. The petitioner is bound to repay to the respondent the amount of actual loan obtained by him amounting to Rs. 1 2,00,000/-'

ii. The petitioner shall pay an additional compensation of rupees one million over and

above the actual amount keeping in view the

inflation in Pakistani currencY'

and iii. The entire amount stated above i'e' the actual the compensation would be payable within a

€f- Period of 04 months from the date of announcement of the judgment'

The aforesaid amount will be a charge on the iv.

property mentioned in the agreement and in case amount the petitioner has failed to pay the said within the period stated above' it will be the sale of recoverable by the executing court from

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the said properly strictly in conformity with the mechanism provided under Order XXI CPC which would, inter alia, include first determination of the market price being a reserved price and due proclamation by the court itself in a manner as provided under Order XXI Rules 66, 67 and 68 CPC by appointing a court auctioneer to sell the same

Y. If any delay is caused in recovery of the amount against the sale of the property beyond the period of six months, the petitioner will be bound to pay markup on the said amount from the said date on the lending rates of any Islamic bank.

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Announced JUDGE

S.B Hon'ble Mr' Justice Syed fushad Ali Mahmood Shah, SSS