P L D 1996 Karachi 475 https://www.pakistanlawsite.com/Login/PrintCaseLaw?

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P L D 1996 Karachi 475

Before Rasheed Ahmed Razvi, J

FAZAL MAHMOOD--Plaintiff

versus

SARDAR KHAN and 3 others --- Defendants

Suit No.583 of 1995, decided on 18th April, 1996.

(a) Contract Act (IX of 1872)---

---- S. 55 --- Agreement to sell --- Time whether essence of the contract --- No time
was specified for completion of sale transaction --- Time would start running from the
day defendants refused to perform their obligation --- Time was, thus, not the essence
of agreement in question.

Mian Tajammul Hussain and I others, v. State Life Insurance Corporation of Pakistan
1993 SCMR 1137 and Muhammad Fazal Karim v. Muhammad Khan Junejo and 3
others PLD 1993 Kar. 560 rel.

(b) Federal Investigation Agency Act, 1974 (VIII of 1975)--

S. 5(5) --- Constitution of Pakistan (1973), Art.24---Member of Federal Investigating

Agency --- Powers under S.5(5), Federal Investigation Act, 1974-- Extent --- When a
member of Federal Investigating. Agency who was conducting investigation was of the
opinion, that any property, which was subject-matter of investigation was likely to be
removed or disposed of before an order of appropriate Authority for its seizure was
obtained, such member can restrain the owner or any other concerned person from
removing, transferring or disposing of such property in any manner --- Provision of S.
5(5) of the Act, however, does not confer an absolute power on a member of Federal
Investigating Agency to restrain, seize or impound any property for indefinite period
without obtaining orders from appropriate Authority viz. competent Court --- Member
of Federal Investigating Agency, however, should not frequently or freely resort to the
use of power under S.5(5) of the Act, such powers should be exercised with restraint
and caution for its use might sometime result in infringement of Art. 24(i) of the
Constitution which guarantees that no person would be completely deprived of his
property save in accordance with law.

Syed Ahmad Hussain Shah through Legal Heirs v. Mian M.A. Razza and others 1992
MLD 2219; Abdul Hamid v. Abbas Blial-Abdul Hussain Sodawaterwala PLD 1962 SC

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1; Ghulam Nabi and others v. Seth Muhammad Yaqub and others PLD 1983 SC 344
and Muhammad Muslim v. Federal Investigation Agency PLD 1984 Kar. 71 ref.

(c) Registration Act (XVI of 1908)--

---- Ss. 17 & 49 --- Registered documents --- Presumption of correctness is attached to
registered documents unless denied.

(d) Specific Relief Act (I of 1877)-

---S. 12 --- Civil Procedure Code (V of 1908), O.XII, R~6 --- Federal Investigation
Agency Act, 1974 (VIII of 1975), S.5(5) --- Suit for specific performance of agreement
to sell---Judgment on admission --- Defendants (owners) admitting plaintiff's claim
relating to agreement of sale and submitting consent written statement --- Federal
Investigating Agency in its written statement as also in its counter-affidavit admitting
ownership of defendants (vendees) in respect of property in question --- Application
for grant of decree in terms of OXII, R.6, C.P.C. must succeed --- Defendants were
directed to execute proper sale-deed before concerned Sub-Registrar within specified
time --- Defendants would be entitled to withdraw balance sale amount lying with
Nazir of Court-- In case of -failure of defendants to execute proper conveyance deed
within specified time, Nazir of Court was authorised to execute sale-deed in favour of
defendants --- If, execution of proposed sale-deed through Nazir of Court was effected
he would be entitled to receive specified amount as Nazir's fee.

Kassamali Alibhoy v. Shaikh Abdul Sattar PLD 1966 Kar. 75; Goblin Dad Rhatter v.
Gaganand Pandey AIR - 1944 Cal. 190; Macdonald Layton & Company Limited v-
Messrs Uzin Export Import Enterprises and another PLD 1989 Kar. 645: Mian Tajamul
Hussain v State Life Insurance Corporation of Pakistan 1993 SCMR 1137, Fazal
Karim v. Muhammad Khan Junejo and 3 others PLD 1993 Kar. 560 and syed Ahmad
Hussain Shah v. Mian Muhammad Raza 1992 MLD 2219 ref.

Abul Inam for Plaintiff.

Abbas Ali for Defendants Nos. I to 3.

Farooq H. Naek Dy. A.-G. for Defendant No.4.

JUDGMENT

Through this application, the plaintiff has prayed for a decree on admission, on the
ground that all the defendants in their respective written statements have not denied
claim of the plaintiff. This is a suit for specific, performance of an agreement to sell
dated 20-2-1988 for immovable property situated at 151-L, P.E.C.H.S., Block 2.
Karachi., and measuring 1,000 sq. yds, (hereinafter referred to as the property in suit).
This agreement was executed between the plaintiff on the one hand as the purchaser

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and the defendants Nos. I to 3, as sellers, on the other hand. Defendant No.4 namely
Federal Investigating Agency has filed its counter-affidavit to this application
(hereinafter referred to as the F.I.A.). The remaining defendants have not filed any
counter-affidavit.

2. I have heard Mr. Abul Inam, for the plaintiff, Mr.Abbas Ali, for defendants Nos. I to
3 and Mr. Forooq H. Naek, learned D.A. G. for defendant No.4. It is contended by Mr.
Abul -Inam that the defendants Nos. I to 3 have not denied execution of agreement
dated 20-2-1988 and have expressed their willingness to execute the same in their
written statement. Ii is further argued by the learned counsel for the plaintiff that the
defendant No.4 has also not denied the ownership of the defendants Nos. I to 3 but
have raised frivolous anti vexatious objection, which are not sustainable in law.
According to Mr Abul Inam, in view of the admissions made by the defendants, the
plaintiff is entitled for a decree as prayed. He has referred to the case of Mian
Tajammul Hussain and 3 others v.. State Life Insurance Corporation of Pakistan 1993
SCMR 1137. Muhammad Fazal Karim v. Muhammad Khan Junejo and 3 others PLD
1993 Kar. 560 and Syed Ahmad Hussain Shah (deceased) through Legal Heirs v Mian
M.A. Razza and others 1992 MLD 2219.

3. Mr. Abbas Ali, learned counsel for the defendants Nos. I to 3, has half-heartedly
opposed this application in view of clear admissions made by his clients vide
paragraphs 2 and 5 of their joint written statement- Mr. Farooq H. Nack, learned
D.A.-G., appearing for defendant No.4, has vehemently opposed this application on the
grounds, inter alia, that the property in question was impounded by the F.I.A. vide
section 5(5) of the F.I.A. Act, 1974. He has also contended that the property in
question belongs to an investment company, namely, Messrs Abdul Samad Dadabhoy
and is therefore, subject of JM-31/1991. He has denied that the F.I.A. has ever,
admitted ownership of defendants Nos.1 to 3, He has prayed for dismissal of this
application as well as the suit with cost.

4. 'The case of the plaintiff is that he bas entered into an agreement to sell with the
defendants Nos. I to 3 on 20-2-1988 for the property in suit against total sale
consideration of Rs. 16,40.000. That a sum of Rs. 13,00,000 was paid to the said
defendants and it was agreed that the balance sale - consideration of Rs.3,40,000 was
to be paid by the plaintiff to the defendants NosA to I at the time of execution and
registration of the sale-deed. It is further claimed in the plaint that the physical
possession of the suit property was also delivered to the plaintiff on the date of
execution of the agreement to sell. It is the further case of the plaintiff that in the
month of February, 1989 when he appeared before the Sub-Registrar for execution and
registration of the proposed sale-deed, it was refused by the concerned Sub-Registrar
on the grounds, that the defendant No.4 had directed the said Sub-Registrar not to
register any conveyance deed in respect of the property in suit. Thereafter, as alleged in
the plaint, the plaintiff made several efforts for removal of such stigma from the
property in suit but of no avail.

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5. On the question from the Court, as to how this suit is maintainable in view of the fact that the agreement to
sell, was executed on 20-2-1988 and the suit was filed on 2-8-1995, after a lapse of nearly seven years, Mr.
Abul Inam, referred to several Annexures filed with the plaint, including annexure 'H' dated 26-4-1992,
Annexure 'I' dated Q-10-1992, Annexure dated 22-3-1993 and Annexure 'M' dated 3-8-1995. Except for
Annexure 'M' he defendant No. I in all his previous communications addressed to the plaintiff as expressed
his willingness to perform his obligation. In his last letter dated 3-8-1995, issued in reply to the legal notice
of the plaintiff dated 5-7-1995, the defendant No.1 refused to perform his obligations and revoked he
agreement and also threatened that he would get the property in suit vacated from the plaintiff. According to
the learned counsel for the plaintiff, the time limit prescribed in Article 113 of the Limitation Act, 1908 will
run from the date 25-7-1995 when the defendant No. I revoked the agreement and, therefore, he suit is within
time. I have also gone through Annexure 'A' filed with the plaint, which is an agreement to sell. Nowhere any
time was specified for completion of the sale transaction and, therefore, in my view the time will start
running from the day the defendants Nos. I to 3 refused to perform their, obligations. Time is not the essence
of this agreement. This suit is, therefore, within time. (For reference see the case of Abdul Hamid v. Abbas
Bhai-Abdul Hussain Sodawaterwala PLD 1962 SC I and Ghulam Nabi and others v. Seth Muhammad Yaqub
and other's PLD 1983 SC 344.

6. Now reverting to the question of "admission", it would be necessary to consider the alleged admissions,
made by the defendants in their respective written statements. Defendants Nos.1 to 3 have filed their joint
written statement. They have not specifically denied paragraphs I to 3, 6 to 9 and 11 of the plaint. In para. 2
of their written statement they have stated that Messrs Samad Housing Development Corporation never had
anything to do with the property in suit nor the said defendants ever entered into any type of. transaction in
respect of the suit property. They have claimed that the notice issued by F.I.A. under section 5(5) of F.I.A.
Act, 1974 is illegal, unjust and arbitrary. In para. 5 of their written statement, they have expressed their
willingness to perform their part of obligations. It would be advantageous if the same is reproduced: --

"That with regard to the contents of para. 10 of the plaint it is submitted that answering defendants Nos. I to 3
were and are still ready and willing to execute a proper sale-deed in favour of the plaintiff on payment of
balance sale consideration amounting to Rs.3,40,000 by the plaintiff to answering defendants Nos. I 'to 3 and
so far answering defendants Nos. I to 3 have been prevented to do so on account of notice under section 5(5)
of the F.I.A. Act, 1974, issued by defendant No.4."

7. Defendant No.4, namely F.I.A., has filed. its written statement through one Ali Qasawar Bukhari, Deputy
Director, F.I.A., State Bank Circle, Karachi.

It is pertinent to note that the defendant No.4 has not denied paragraph I of the plaint, which amounts to
accepting the defendants Nos. I to 3 as lawful and bona fide owners of the property in suit. Order VIII, Rules
3, 4 and 5 of C.P.C. provides that the denial in a written statement should be specific and not evasive. Rule 5
to Order VIII further provides that where an allegation of fact in a plaint is not denied specifically or by
necessary implication it shall be taken to be admitted except against a person under disability. The entire case
of this defendant is that in the month of June, 1988 after receiving a letter from P.E.C.H.S. they came to know
that the property in question was sold to Messrs Al-Feroz (Pvt.) Limited by the defendants Nos.1 to 3 through
an agreement, dated January, 1987. It is the further case of the defendant No.4 that during the course of
investigation, pertaining to the case of Messrs Samad Housing Development Corporation, they came to know
that this property belongs to the said company and, therefore, a notice under section 5(5) of F.I.A. Act, 1974
was served. They have admitted in para. 5 of their written statement that during ,the course of investigation
F.I.A. was not able to collect any documentary evidence to connect the suit property with Messrs Samad
Housing Development Corporation. This fact was further reiterated in paragraph 8 of their written statement

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but this time they qualified by saying that it was admitted by an estate agent namely
Dawood Baig in his statement recorded under section 161, Cr.P.C. that the said
property was purchased by Abdul Samad Dadabhoy from one Mr. Talat who purchased
it from AI-Feroz (Pvt.) Limited. In para. 9 they have admitted that this Court has
jurisdiction to direct them for-vacation of notice issued under section. 5(5) of the F.I.A.
Act, 1974. The contents of written statement of defendant No.4 support the case of the
plaintiff to the extent that the plaintiff purchased this property from defendants Nos. I
to 3, who are lawful owners.

8. There is another admission made by the defendant No.4 but this time in their
counter-affidavit filed in reply to the plaintiff's application under Order XII, rule 6,
C.P.C. The plaintiff in para. 3-of application has referred to para. 5 of the written
statement of the defendant No. 4 and has claimed that the notice under section 5(5) of
the F.I.A. Act was based on no evidence and has no legal sanctity. In its
counter-affidavit, filed by the Deputy Director, F.I.A. State Bank Circle, Karachi, the
contents of para. 3 of plaintiff's affidavit, as referred above, were admitted. It was
argued by Mr. Abul Inam, that such admission entitles the plaintiff for a declaration as
prayed in para. (a) of the prayer clause. The defendant No. 4 has filed a copy of a
letter, written by one Maqsood Ahmed, Assistant Director, F.I.A. E.E. Wing, Karachi,,
which shows that on 31-8-1987 an enquiry was initiated which Was numbered as,
4/1987. Through this letter some 15 immovable properties were made subject-matter of
the investigation. Following is the relevant portion of the said notice under section 5(5)
of the F.I.A.:-

"Now, therefore, in exercise of the powers conferred upon me under section 5 of the
F.I.A. Act, 1974. 1 hereby issue you notice under section 5(5) of the F.I.A. Act, 1974
with the directions not to transfer or otherwise dispose of the abovesaid properties in
any manner, except with the previous permission of the undersigned."

Close examination of subsection (5) to section 5 of the F.I.A. Act, 1974 reveals that
when a member of F.I.A., who is conducting an investigation is of the opinion that any
property, which is subject-matter of an investigation is likely to be removed or
disposed of before an order of the appropriate authority for its seizure is obtained, such
member may restrain the owner or any other concerned person from removing.,
transferring or disposing of such property in any manner. This provision does not
confer an absolute power on a member of F.I.A. to restrain, seize or impouned any
property for indefinite period without obtaining orders from appropriate authority
which, in my view, means a competent Court of law. I am fortified in my view by a
decision of learned Division Bench of this Court comprising Mr. Nasir Aslam Zahid
and Mr. Ali Nawaz Budhani, JJ. (as they then were) in the case of Muhammad Muslim
v. Federal Investigation Agency PLD 1984 Kar. 71 wherein the application of section
5(5) of the F.I.A. Act was considered. The Constitutional petition was allowed and the
order of detention of goods by the F.I.A. was declared to be without lawful authority
and of no legal effect with the following observation-

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The comments clearly show that there was sufficient time available with the F:I.A. for obtaining an order of
seizure from the appropriate authority. However, this was not done and the. concerned inspector decided to
exercise the powers under subsection -(5) of section 5 of the F.I.A. Act, 1975. In our view in these
circumstances, the powers could not be exercised by the Inspector under subsection (5) of section 5 and the
goods could have been detained only after an order of seizure had been obtained from the appropriate
authority. We have also been informed by the learned standing counsel as observed earlier that uptil now no
order has been passed by any authority or Court about the seizure and detention of the goods by the Inspector
of F.I.A. The order passed by the Inspector of FI.A. for detention of the goods was, therefore, illegal and
without any authority."

I am also of the opinion that a member of F.I.A. should not frequently or freely resort to the use of power
under section 5(5) of the F.I.A. Act but such powers should be exercised with restraint and caution as its use
may sometime result in the infringement of Article 24(l) of the Constitution, 1973, which guarantees that no
person shall be compulsorily deprived of his property save in accordance with law.

9. The claim of plaintiff that the property in suit is not the subject-matter of JM-31/1-991 was not denied by
any of the defendants. No material was placed by these defendants to substantiate their claim that in any
manner this property has changed hands from the defendants Nos. 1 to 3 to Messrs Al-Feroz (Pvt.) Limited or
Mr. Talat. In absence of any material on record, it can be safely held that Messrs Al-Feroze (Pvt.) Limited or
Mr. Talat were outsiders having no authority to create any lien, charge or any interest on the suit property. On
11-4-1996, the plaintiff was directed by this Court to produce all title documents in their possession which
were produced before the Court on 14-44996. 1 have examined ' the original title documents in Court which
are in possession of the plaintiff. It is settle law that presumption of correctness is to be attached to, the
registered documents unless denied.

10. In my view, the abovementioned written statement of the defendants Nos.1 to 3 clearly constitute
"admission" as envisaged in Order XII, rule 6, C.P.C. These admissions by the defendants Nos. 1 to 3 in their
written statement are unqualified and absolute. In the above paras. I have discussed the admissions made by
the F.I.A. in its pleadings and in other affidavits. Such admission by the defendants also amount to estoppel.
(For reference see the case of Kassamali Alibhoy v. Shaikh Abdul Sattar PLD 1966 Kar. 75. Gobind Dad
Bliatter v. Gaganand Pandey AIR 1944 Cal. 190 and Macdonald Layton & Company Limited v. Messrs Uzin
Export Import Enterprises and another PLD 1989 Kar. 645.

11. In the case of Mian TaJamul Hussain (1993 SCMR 1137) this Court decreed the suit of the respondents
on the basis of admission made in a letter filed with its written statement. The appellant went into appeal
before a D.B. of this Court which appeal was dismissed and the order of learned Single Judge was affirmed.
In appeal before the Hon'ble Supreme Court, it was argued that since the document which was filed
alongwith the written statement was not exhibited, no decree can be passed. This argument was not upheld
and the appeal was dismissed with the following observation:--

"The objection raised by the learned counsel for the appellant is a hypertechnical one. The learned counsel
for the appellant had admitted the document which had been filed alongwith the written statement. After
being admitted the fact that it was not exhibited does not include the documents from taking it into
consideration. The learned counsel for the appellant had not challenged the genuineness of the document, but
admitted to be genuine and correct. In such circumstances, if the exhibit number was not put on the document
it will not make it inadmissible particularly when no evidence was orally produced by the parties. Thus,
admitting the document in evidence or relying upon. it was not an illegality which may vitiate the judgment
and decree, passed by the learned Single Judge and confirmed by the impugned judgment. "

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12. Another Single Judge of this Court in the case of Fazal Karim PLD 1993 Kar. 560 held that since the
defendants in several miscellaneous applications, moved from time to time, admitted that they have no
objection to the completion of the sale, the suit of the plaintiff was entitled to be decreed under Order XII,
rule 6, C.P.C. The case of Syed Ahmad Hussain Shah (1992 MLD 2219) relates to an admission made by a
Government functionary and in effect on the Government. It was held by a learned Single Judge of Lahore
High Court that an admission by an official of the Government is binding on the Government when it is made
by such official in discharge of his official duties and that a Court is entitled to render a decision on the basis
of such admission made under rule 6 to Order XII, C.P.C. provided that such admission is clear, unambiguous
and is beyond doubt. In the present suit, the admissions made by the Dy. Director, F.I.A., Karachi, in its
written statement as well as in its counter-affidavit in respect of the ownership of the defendants Nos. 1 to 3
of the suit property, in regard to the sale agreement and on the legality of the notice under section 5(5) of the
F.I.A. Act are clear and unambiguous. I am of the, considered view that the result of this suit would not be
different even if the parties are allowed to lead evidence and if the suit is decided on merits. Therefore, this
application must succeed.

13. As a result of above discussion, C.M.A. 6544 of 1995 is granted and the suit of the plaintiff is decreed on
admission with no order as to costs, in the following manner:--

(a) Defendants Nos. I to 3 are directed to execute a proper sale-deed before concerned Sub-Registrar,
Karachi, in favour of the plaintiff within 30 days.

(b) The defendants Nos. I to 3 shall be entitled to withdraw the balance sale consideration amounting to
Rs.3,40,000 lying with the Nazir of this Court, which was deposited by the plaintiff in furtherance of this
Court order dated 14-12-1995.

(c) In case, the defendants Nos. I to 3 fail to execute proper conveyance deed as directed in para. (a) above
within a period of 30 days, the Nazir is authorised to execute the sale/conveyance deed for the suit property in
favour of the plaintiff.

(d) In case of the execution of proposed sale-deed through the Nazir of this Court, the plaintiff shall pay a
sum of Rs.5,000 as Nazir's fee.

A.A./F-6/K Suit decreed.

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