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Civil Appeal No.13 of 1987, decided on 14th March, 1987.

---O.XXXIX, Rr. 1 & 2--Temporary injunctions--Purpose of grant of interim relief. To protect the rights of a weaker and to save the high handedness of stronger, the Courts of law are established and the aggrieved persons are empowered to enforce their rights over the intruders through these Courts. While the Courts are equipped with the powers to administer justice, the rules are framed for their guidance to be applied to conduct the proceedings and to take decisions as some time, shorter or longer time is required for the trial of the cases, therefore, the powers to grant interim relief, such as appointments of receivers, issuance of stay orders and injunctions etc. are given to the Courts to be exercised to protect the subject of disputes from destruction and wastage during the pendency of the proceedings.

A I R 1929 Lah. 111; P L D 1969 Lah. 823; P L D, 1972 Lah. 847; 1973 S C PEI R 122; P L D 1956 (WP) Kar. 521; P L D 1973 Lah. 733; P L D 1976 Pesh. 1; P L D 1979 Lah. 930; P L D 1983 Kar. 383; N L R 1984 A C 21; N L R 1984 Civil 323 and 1985 CLC 1457 ref.

---O.XXXIX, R.1--Interim injunction, grant of--Requirements--Person claiming relief of interim injunction is required to show that he had brought a genuine claim which required serious thought and if status quo with regard to subject of dispute was not maintained, he would suffer an irreparable loss and that the balance of convenience was on his side- -Cc-existence of all such conditions was essential to authorize the Courts to exercise discretion and grant relief of injunction--Existence of only one two of such conditions was not sufficient to ,grant such relief--Courts while granting interim relief, however, are not required to conduct deep probe into the case at the time of deciding questions of issuance of injunction, lest same might influence trial Court to form opinion about the point at issue at the time of pronouncement of judgment.

A I R 1961 Pat. 318; P L D 1981 Lah. 752 and P L D 1983 Quetta 92 ref.

---S. 2(b)--Agreement, formation of--Requirements--To constitute an agreement necessary requirement would be an unconditional offer and acceptance thereof, by competent person/authority--Conditional offer by tenderer to purchase property if certain conditions were fulfilled which conditions having not been accepted by authorized person/ authority, no- agreement came into being.

---O.XLIII, R. 1(r)--Appeal against interim order--Grant of interim relief which did not fulfil requirements of law with regard to grant of interim injunctions being unwarranted by law was,set aside by High Court in appeal.

Manzoorul Hassan Gillani A.G. and Basharat Ahmed Sheikh for Appellants.

Anwar Baig and Muhammad Sharif Tariq for Respondents.

This appeal has been filed to call in question an order dated 14th of February, 1987, passed by the District Judge Mirpur, whereby through an injunction, the appellants Nos.l and 2 were directed to refrain from delivering possession of the AKMIDC Textile Mills Mangla (hereinafter shall be referred to as mill), to the appellant No.3 and the appellant No.3 was stopped to take possession of the mill, till further orders. Besides this, the respondents Nos. 2 and 3 were directed to refrain from extending financial aid to the appellant No.3 and the status quo of the Mill; was required to be maintained.

2. The facts which form background of this appeal, briefly stated are that the -Azad Government of the state of Jammu and Kashmir, through a Notification No.AKMIDC-043-45/86, dated the 19th of April, 1986, appointed a Negotiating Committee (hereinafter shall be referred to as Committee), to finalize the sale of the three Industrial Units of the A&MIDC which included the Mill with the direction to finalize the deal 16 the light of the terms and conditions agreed to between the Pakistan Banking Council and the Azad Government of the State of Jammu and Kashmir. The Committee invited bids for the sale of the Mill and five tenders were received; out of them. Messrs Chakwal Industrial Mills Chakwal, did not quote the price. As the bid required study, therefore, the deal remained unfinalized. The tenderers were, however, invited at Islamabad for negotiations but only two of them i.e. the appellant No.3 and the respondent No.l turned up.

3. Before holding the negotiations the Committee thought it advisable to seek clarification of the bids to be incorporated in a pro forma, given to them. The appellant No.3 stuck to his earlier offer to the effect that he will pay a sum of Rs.75 Millions, provided the project was declared to be a new one and was given tax holiday for five years, the registration expenses were borne by the vendors and an area of the land mentioned in the balance sheet of 1982 i.e. 371 Kanals was transferred with the Mill. The respondent No.l however, reduced the price already offered and expressed willingness to purchase the Mill on payment of Rs.86.70 Millions, provided the area of the land mentioned in the balance sheet of 1982, was also transferred with the Mill.

4. The Committee recommended the offer pf the respondent No.l, provided the demand for transfer of the area mentioned in the balance sheet of 1982 was given up and the area mentioned in the advertisement i.e. 255 Kanals was accepted.

5. As it transpires from the record, this recommendation had yet not reached the Government when on the 20th of October, 1986, the appellant No.3 submitted an application to the Prime Minister and offered him to purchase the Mill on payment of Rs.86.70 Millions unconditionally and the Prime Minister forwarded .it to the Minister for industries who in turn marked it to the Chairman AKMIDC (the appellant No-2). The appellant No.2 and the Chairman of the Committee (appellant 146.1) after having reviewed all the proceedings conducted by the Committee and the offers made by the appellant No.3 and respondent, No.l, found that it would be in the interest of the corporation as well as of the Government if the offer of the appellant No.3 made through an application dated 20th of October, 1986, was accepted consequently, the recommendation was made to that effect on 30th of October, 1986. The Government on receipt of the recommendation dated 30th of October, 1986, accorded the approval to the acceptance of the offer of the appellant. No. 3 and informed him of it through Letter No .AKMIDC/3419 21/ 6, dated the 24th of December, 1986(PB). The Government also approved of the sale of the Mill in favour of the appellant No.3 through Government Order No. GAD/01-12/87, dated 11th of January, 1987 (PA).

The respondent Ko.l, through a civil suit filed on the 26th of January, 1976 in the Court of District Judge Mirpur, challenged the validity of the Government Order (PA) and letter (PB) and sought a declaration to the effect that the Government Order and the letter are ineffectual as against his rights and are of no legal effect on the main ground that he made an offer to purchase the Mill which was accepted and once an offer is accepted, it becomes an agreement and it cannot be revoked unilaterally and as the action taken by the respondents No' .1 and 2 through the documents (PA) & (PB), amounts to revocation of the agreement, therefore, it is an illegal action and is required to be declared as null and void.

7. The respondent No.1 through an application supported by an affidavit, moved alongwith the plaint, sought an injunction to refrain the appellants Nos.l and 2 to deliver the possession of the Mill to the appellant No.3 and to stop the respondents Nos.2 and 3 to extend financial aid to the appellant No.3, till -the disposal of the suit.

8. The learned District Judge, after hearing the parties, through an order dated 14th of February, 1987, granted the prayer. He held that the bid filed by the respondent No.l was the highest and the Committee has made recommendation in his favour and as such he has a Prima facie case and the balance of convenience is also on his side. Since the sale has not yet taken place and the other necessary formalities are required to be done, therefore, the appellant No.3 shall not suffer any irreparable loss if the prayer to grant an injunction is allowed and this order of the District Judge is the subject matter of the present appeal.

The learned Counsel for the appellants, to assail the impugned order, has stressed that the learned District Judge fell in error to hold that the respondent No.l has a prima facie case. The view of the learned District Judge that the balance of convenience is on the side of the respondent No.l and the appellant No.3 shall not suffer any irreparable loss if the possession of the Mill is not transferred to him, is also misconceived.

10. To attend to the point as to whether the respondent No.l has a prima facie case, he stated that the case of the respondent No.l as disclosed in para 6(i) of his plaint, is that he offered to purchase the Mill and the offer was accepted which constituted an agreement. This stand is not supported from the record so far placed on the file. Mere filing of the bid does not create any right to the bidder. The right accrues to him if the bid is accepted.

11. As far as the balance of convenience is concerned, the appellant No.3 has deposited ten per cent of the price of the Mill and no benefit will accrue to him if the Mill remains in the hands of the person other than the person appointed by him. Furthermore, if the machine is not properly attended to or it is handled by irresponsible person, there is every likelihood of its destruction and if it happens, the appellant No.3 shall suffer an irreparable loss.

12. To take up the point of irreparable loss, he argued that the appellant No.2 has secured huge loan from the Banking Council of Pakistan and till the possession of the Mill is not transferred to the appellant No.3, an huge amount (running into lacs) will have to be paid by the appellant No.2 as an interest per month.

13. As against this, the respondent has no money at stake and he has no lien of whatever nature ever the Mill and he will not suffer any loss in any way, therefore, the opinion formed by the District Judge that the balance of convenience is in favour of the respondent No.l and the appellant No.3 shall not suffer any irreparable loss, is incorrect. In support of his point of view, he cited the following authorities: -

A I R 1929 Lah. 111, P L D 1969 Lah. 823 and P L D 1972 Lah. 847.

14. The learned counsel for the respondent No.l, to controvert the stand taken up by the learned counsel for the appellants, urged that the bid offered by the respondent No.l was the highest and the appellant No.l has made recommendation to the Government for acceptance of his bid, thus, it constitutes an agreement, therefore, it will be wrong to say that the respondent No.l has no prima facie case.

15. To attend to the point of balance of convenience, he argued that the respondent No.l offered the highest amount to purchase the Mill and there is no reason to believe that his bid will not be accepted, therefore, the balance of convenience is also on his side. As far as the question of irreparable loss is concerned, the appellant No.3 made an offer before the appellant No.l to purchase the Mill on payment of Rs.75 Millions, provided the project was declared to be new one and five years tax holiday was given and the registration charges were borne by the vendor, therefore, this offer will have to be considered while according the approval for acceptance of it. Any other offer subsequently changed, cannot be taken into consideration and if the appellant No.3 has deposited any amount, it is a result of underhand dealings and his complaint about any loss out of it, cannot be taken into consideration. An under-bidder cannot claim lien over the Mill and if the possession is not transferred to him, he will not arable loss and in support of his contention he cited suffer any irreparable the following authorities:-

1973 S C M R 122; P L D 1956 (WP) Kar. 521;. P L D 1973 Lah, 733; P L D 1976 Pesh. 1; P L D 1979 Lah. 930; P L D 1983 Kar. 383; N L R 1984 A C 21 N L R 1984 Civil 323 and 1985 C r, C 1457.

16. I have considered the arguments advanced by the learned counsel for the parties, have perused the record of the case carefully and have also studied the authorities cited at the Bar.

17. To protect the rights of a weaker and to save the high-handedness of stronger, the Courts of law are established and the aggrieved persons are empowered to enforce their rights over the intruders through these Courts. While the Courts are equipped with the powers to administer justice, the rules are framed for their guidance to be applied to conduct the proceedings and to take decisions as some time, shorter or longer is required for the trial of the cases, therefore, the powers to grant interim relief, such as appointments of receivers, issuance of stay orders and injunctions etc, are given to the Courts to be exercised to protect the subject of disputes from destruction and wastage during the pendency of the proceedings as is manifest from the provisions of Orders XXXIX and XL C.P.C.

18. To claim the relief of an interim injunction, it is required of a party to the suit to show that he has brought a genuine claim which requires serious thought and if status quo, with regard to the subject of dispute is not maintained, he will suffer an irreparable loss and the balance of convenience is also on his side. It is well-settled by now that the co-existence of all the three aforesaid conditions is essential to authorize the Courts to exercise the discretion and grant the relief of injunction. The existence of only one or two of them are not sufficient as has been held by the Patna. High Court in a case reported in A I R 1961 Pat. 318 and the relevant observations are hereinafter reproduced:

" . the fact that a prima facie case has been made out by showing that there is fair question for trial, does not necessarily mean that a temporary injunction must follow restraining the contracting defendant from dealing with the property, and whether an order of injunction should or should not issue will depend on the facts of- the case, and the Court must also consider the questions of irreparable or serious injury and balance of convenience."

19. The Lahore High Court, while considering the advisibility to issue an injunction in a case reported in P L D 1981 Lah. 752, laid down the following rule:

"It has been very amptly pointed out by the learned counsel for the respondents that the mere presence of a prima facie case or arguability thereof will not by itself be a ground for issuing a temporary injunction. It is by now well-settled that the three conditions viz. the existence of a prima facie case, the irreparability of loss, and balance of convenience must co-exist before the temporary injunction could be allowed in a matter. "'

20. The Quetta High Court in a case reported in P L D 1983 Quetta 92, found that co-existence of all the three requirements is necessary to empower the Courts to grant the relief. The relevant observations are hereinafter reproduced:-

"It has been very amptly pointed out by Mr. Munawar Ahmed Mirza, the learned counsel for the respondent Abdul Waris that a mere presence of a prima facie case or arguability thereof as considered by the learned Senior Civil Judge will not by itself be a ground for issuing a temporary injunction. It is by now well-settled that all the three conditions viz. the existence of a prima facie case, the irreparability of loss and balance of convenience must co-exist before the temporary injunction would be allowed in the matter."

21. After having found that to empower the Courts to grant interim relief, all the three requirements mentioned in para 18 above, should be available, the propriety of grant of injunction by the lower Court in the present case, is required to be examined. But before embarking upon to scrutinize the legality of the order impugned in this appeal, it is observed that the Courts, especially the appellate Courts are not required to conduct deep probe into the cane at the time of deciding the questions of issuance of an injunction, lest it may influence the trial Court to form an opinion about the point at issue at their time of pronouncement of final judgment.

22. To look into the question as to whether the respondent No.l has a prima facie case, the documents so far placed on the file, show that he submitted an offer to purchase the Mill on payment of Rs.86.70 Millions, provided the area of land measuring 371 Kanals was also transferred to him alongwith the Mill when the appellant No.3 was an under, bidder, hence the Committee recommended his offer for acceptance but before the recommendation of the Committee reached the Government, the appellant No.3, by use of under-hand methods, as alleged by the respondent No.l, enhanced his offer and secured its acceptance.

23. As the enhancement of the offer by the respondent No.l is a point of dispute and the trial Court will examine its worth, after the trial of the case, therefore, the claim of the respondent No. 1, assuming that the appellant' No.3 did not enhance his offer, has got to be looked into.

24. To constitute an agreement, it is necessary that there should be an unconditional offer and it is accepted by the competent authority and after the constitution of the agreement, the right to the parties accrue. In the present case, the respondent No.l, no doubt, made an offer to purchase the Mill, provided an area of the land measuring 371' Kanals was also given to him and the Committee, without accepting the conditions recommended the offer. This recommendation, I believe, I could not have been accepted because the tenderer offered to purchase the Mill, provided his condition was accepted but the recommending body i.e. the Committee did not approve, of, the condition, hence it was not possible for the Government to accept its recommendation, unless the tenderer was asked to forego the condition. Be as it may, as it transpires from the record, the offer has not been accepted, hence the agreement has not come into being, therefore, there accrues no right to the respondent No.l on the basis of his offer.

25. The question as to whether the tenderer, after filing the bid and before its acceptance, acquired the right over the subject of offer, was considered by the Lahore High Court in a case reported in A I R 1929 Lah. 114 and it was found that no right has accrued to the tenderer. The question of the like nature again cropped up for consideration before the same High Court in the cases reported in PLD 1969 Lah. 823 and P L D 1972 Lah. 847 and the conclusion arrived at in the former cases was found to be correct.

26. In the cases cited by the learned counsel for the respondent No.l and reported in P L D 1956 (W.P.) Kar. 521, P L D 1983 Kar. 387, N L R 1984 A C 21 and N L R 1984 Civil 323, the claim of vendees based on contract of sale, where either the possession was transferred to the vendees on the basis of the contract or there was positive evidence and admission on the part of the vendors, to have received the consideration, or part of it, required adjudication, therefore, the status quo was ordered to be maintained.

27. In the case reported in P L D 1973 Lah. 733, the acceptance of tender was challenged on legal grounds whereas in the cases reported in P L D 1976 Pesh. 1, the lease given to a person who was an under-bidder and who had increased his offer after the tender of the highest bidder was accepted by the Municipal Committee, was set at naught. In f L D 1979 Lah. 930, an appeal filed by a person who was an under-bidder and who had increased his offer after the bid of highest bidder was accepted was considered.

28. In the case reported in 1973 S C M R 122, the action -of the controlling authority, whereby lease was given to a person when his offer was not recommended by the Karachi Municipal Committee, was declared to be illegal and in the case reported in, 1985 C L C 1457, whereby on a petition of a person who was given the charge of the octroi, after his tender was accepted and who had been collecting the tax for 13 days, the order whereby his lease was cancelled, was set aside.

29. As found earlier, the respondent No.l was a bidder whose bid was not yet accepted when the appellant No.3 increased his offer and succeeded to get acceptance of it and deposited a sum of Rs.86,70,000 i.e. the ten per cent of the price of the Mill. The appellant No.2 obtained huge loans from the respondent No.2 at the time of installation of the Mill and lacs of rupees is its interest. Thus, he is spending about 12 lacs rupees per month in connection With the payment of interest and upkeep of the Mill and this liability will shift to the appellant No.3 as and when the possession of the Mill is transferred. As against this, the respondent No.l has nothing at stake and in case, he succeeds to get a decree in his favour, he will seek retrieval of the Mill and can claim damages for the use of the machine. I, therefore, think that the respondent No.l shall not suffer an irreparable loss if the possession of the Mill is transferred to the appellants, 1 and 2 to the appellant No.3 and the balance of convenience, as compared to the appellants, is not on his side also.

31'1. In the light of what has been discussed above, it is observed that the impugned order whereby4"the injunction was issued against the appellants Nos.l and 2 to stop delivery of possession of the Mill the appellant No.3 and the respondents Nos.2 and 3 were ordered to refrain from extending financial aid to the appellant No.3 and the appellant No.3 was restrained to take possession of the Mill and status quo was ordered to be maintained, is not warranted by law. I, therefore, hereby accept this appeal, with no orders as to costs and vacate the order impugned in this appeal.

A.A./325/H.A. Appeal accepted.

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