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Second Appeal No. 13 of 1986, decided on 22nd April, 198

‑‑‑ O.VIII, R. 1, proviso & R. 10‑‑Written statement‑‑Consequences of failure to present written statement‑‑ Appellant‑defendant specifically given time to file written statement, not only failing to file written statement but moving application for further adjournment‑ ‑Time in fact allowed for nine months‑‑Trial Court, held, could not be said to have arbitrarily exercised discretion in pronouncing judgment against defendant under O.VIII, R. 10, C.P.C.

1980 C L C 930 distinguished.

P L D 1987 S.C. 22 and Abdul Subur v. Ganash Floor Mills Ltd., Lyallpur P L D 1967 Lah. 779 ref.

‑‑‑ Ss. 55, 2(e) & 10‑‑Transfer of Property Act (IV of 1882), S.53‑A‑ Specific Relief Act (I of 1877), Ss. 4 & 12‑‑Contract for sale of plot‑‑suit for specific performance of contract‑‑Time not being essence of contract, promisee could accept performance of promise at any time other than that agreed upon‑‑Such acceptance of performance of promise by promisee would amount to novation of contract‑‑Appellant entering into an agreement of sale of plot with respondent in open auction‑‑ Respondent purchasing the plot in question and paying 25% of auction price and sale later approved by competent authority‑ Acceptance of payment of balance price by appellant after the lapse of agreed time amounted to novation of contract and the same was binding‑‑ Appellant further charging respondent difference of amount found out on recalculation, plot demarcated and possession handed over to respondent‑ ‑Such acts showing that not only the contract had been novated but it had been acted upon by parties‑ ‑Respondent having performed his part of contract and having obtained possession of plot, held, was protected even under S. 53‑A, Transfer of Property Act, 189‑2and could not be dispossessed of the plot.

‑‑‑ Ss. 100 & 101‑‑Second appeal‑‑Grounds on which second appeal lies‑‑Decision of Trial Court as well as Appellate Court not contrary to any law or usage having force of law nor there being any error or defect in the procedure‑‑ Appeal being without any force, dismissed.

S.M. Muslim Naqvi for Appellant.

Zafar Hadi Shah for Respondent.

Date of hearing: 16th April, 1987.

This second appeal is filed against the order of learned District Judge Karachi (East) dated 28‑4‑1986 whereby he dismissed the Civil Appeal No.9/86 filed by the appellant.

I have heard the learned counsel for the parties and perused the record and proceedings of the Courts below.

The facts of the case in brief are that the appellant had purchased in open auction a commercial plot measuring 4,000 sq. yds. bearing No.2 Wool Washing Area, Landhi, Karachi on 29‑12‑1973 at the rate of Rs.17 per sq. yrd. They paid 25% price immediately when the balance was paid on 29‑12‑1979 alongwith penal interest at the rate of 13 per cent. The respondent No.1 accepted the balance of payment and charged the penal interest and also handed over possession of the plot in question to the respondents but ultimately refused to execute the lease‑deed. Hence the respondents filed a suit claiming following reliefs:‑

11(2) For a declaration that the sale of plot commercial‑cum industrial No.2, Wool Washing Area. Landhi, measuring 4,000 sq. yds. has already been completed in all respect.

(b) Mandatory injunction directing the defendants to execute the Sanad of commercial‑cum‑ Industrial plot No.2, Wool Washing Area, Landhi, measuring 4,000 sq. yds. in favour of the plaintiffs.

(c) cost of the suit and interest at 13 per cent on the amount paid by the plaintiffs from the date of the suit till the Sanad is executed.

(d) Any other relief which this Hon'ble Court may deem fit and proper."

This suit was presented on 14‑4‑1985.

The applicants failed to file written statement though time for this purpose was granted to them by the learned trial Court from time to time. Consequently on 31‑12‑1985 the respondents moved an application under Order VIII, Rule 10, CPC for the pronouncement of the judgment. Notice of this application was issued to the appellants who on 14‑1‑1986 moved application for time to file counter‑affidavits and written statements. The learned trial Judge passed an order allowing time to file counter‑affidavits and written statement upto 23‑6‑1986. The appellant again failed to file the written statement and as such the trial Court under Order VIII, Rule 10, CPC pronounced judgment decreeing the suit of the respondent on 23‑1‑1986. The appeal filed by the appellants against this order was also dismissed by the learned District Judge vide impugned judgment.

It is contended by the learned counsel for the appellant that the learned trial Court was not justified in passing judgment under Order VIII, Rule 10, CPC without allowing the respondent to put up their case. He contends that proper course for the trial Court in the circumstances was to impose cost and allow time to the appellants to file written statement. Reliance is placed on 1980 C L C 930 wherein it is held:

"That defendant unless he is specifically required to file written statement can choose not to file the same and yet would not be considered ousted from the proceedings, for he could still appear to contest availability of cause of action."

In the instant case as pointed out above he was specifically given time to file written statement but the appellant not only failed to file written statement but moved application for further adjournment which was rejected by the trial Court. In PLD 1987 S C 22 their Lordships have approved the ratio laid down in the case of Abdul Subur v. Ganash Floor Mills Ltd Lyallpur (PLI) 1967 Lahore 779) and have referred to the following observation in the said judgment.

"Under rule 10, the court has been given the discretion to 'pronounce judgment against' the defendant. It does not mean at all that the Court is to take any further steps to ascertain the truth of the contentions raised in the plaint. In the phrase' pronounce judgment against him' the words 'pronounce and against him' are significant. Once the Court decides to exercise the discretion under rule 10, It has to pronounce the Judgment against the defendant."

Later in the judgment, it was also observed:‑

"It is not necessary for the Court to record any evidence before it may pronounce judgment under rule 10 of Order VIII.

Their Lordships have further held:

"Where the discretion has been exercised and judgment is pronounced the same is not normally to be interfered with. But where it is exercised arbitrarily the appellate Court can always intervene. However, where the discretion has been exercised judiciously and judgment pronounced, the same win be a valid and legal judgment even though it has been passed without recording any evidence whatsoever."

In the instant case the judgment was pronounced after about 9 months of the filing of the plaint. The record shows that the Advocate of the appellant filed his power of attorney in the trial Court on 27‑4‑1985 and since then the case was fixed on number of hearings but written statement was not filed, Proviso to Rule 1 of Order VIII, provides that time for filing the written statement shall not ordinarily exceed 90 days. As already pointed out in the instant case the time in fact was allowed for 9 months. Therefore, the trial Court cannot be said to have arbitrarily exercised the discretion in pronouncing judgment against the respondent under Order VIII, Rule 10 C.P.C. It is contended by the learned counsel for the appellant that according to the terms of the contract and rules, the bidder has to pay the balance of amount within 30 days failing which his bid was to be cancelled and amount of deposit to be forfeited. Admittedly no order cancelling the bid or forfeiting the amount was passed. Even in the Contracts, where time is an essence of the contract, under section 55 of the contract Act, the promisee can accept performance of such promise at any other time than that agreed. C Such acceptance of the performance of the promise by the promisee amounts novation of contract. It is averred in the plaint, that thel appellant had called upon the respondent to pay the balance amount of sale consideration alongwith interest at 10% as penalty and that the appellant No.1 approved the challan and handed over the same to the plaintiff for payment which the plaintiff /respondent paid. It is further averred in para 6 of the plaint, that the defendant /appellant again vide letter dt. 13‑1‑1980 demanded another amount of Rs.16,269.22 towards difference on account of miscalculation of interest charges, land rate, survey charges and sanad fee which was also paid by the respondent. It is also averred in para 8 that the defendant /appellant through their surveyors got the land in question surveyed and demarcated the plot in question and possession was handed over to the plaintiff /respondent. These averments in the plaint are verified on oath and are not rebutted or controverted by any evidence on record before the trial Court.

The contention of the learned counsel for the appellant that the balance of amount was accepted and penalty was charged by officer, who had no authority cannot be accepted at this stage in view of assertion on oath in the plaint that this acceptance was made by defendant‑appellant No.1. It is further contended by the learned counsel that unless the contract is reduced in writing it will not be binding upon the appellant and no right will be created in any person. In the instant case the respondent had filed a suit for specific performance of contract. Section 4 of the Specific Relief Act only bars relief in respect of any agreement which is not a contract. Section 10 of the Contract Act defines as to what agreement are contract. It provides "all agreements are contracts if they are made by free consent of the parties, competent to contract for a lawful consideration and with a lawful object and are not hereby expressly declared to be void." Section 2(e) provides; "Every promise and every set of promises forming consideration for each other is an agreement". In the instant case admittedly appellant entered into an agreement of sale with the respondent in open auction who purchased the plot in question from appellant No.1 and paid 25 per cent of amount of the auction price. Admittedly this sale was approved by competent authority. It is however, contended that the balance of price was not paid within time as it was essence of contract and as such the appellant could not extend the time for payment. In para 12 of the plaint the respondents have cited 10 instances where the late payments were accepted by the appellant No.1 and this fact which is asserted on oath is not rebutted or controverted by any evidence. I have already pointed out that under Section 55 the acceptance by the promisee viz. appellant No.1 of the performance of the promisee viz. payment of balance price after the lapse of agreed time amounts to novation of contract and as such it is binding. Apart from receiving payment of the balance price in 1979, in 1980 the appellant No‑1 further charged the respondent the difference of the amount found out on recalculation. In 1981 the plot was demarcated and possession was handed over to the respondent. These acts show, that not only the contract had been novated but after the novation of contract it has been acted upon by the parties. The appellant, who have performed their part of contract by paying the price of the plot and have obtained possession of the plot are protected even under Section 53‑A of the Transfer of Property Act and cannot be dispossessed of the plot.

Second appeal under section 100 of the C.P.C. lies only on 1E the following grounds‑

"Second appeal. Save where otherwise expressly provided in the body of this Code or by any other law for the time being in force an appeal shall lie to the High Court from every decree passed in appeal by any Court subordinate to a High Court on any of the following grounds; namely:‑

(a) the decision being contrary to Law or usage having the force of law;

(b) the decision having failed to determine some material issue of law or usage having the force of law;

(c) a substantial error or defect in the procedure provided by this Code or by any other law for the time being in force, which may possibly have produced error or defect in the decision of the case upon the merits."

Section 101, C.P.C. provides that no second appeal shall lie except on the grounds mentioned in section 100.

I have already seen that the decision of the trial court as well as the appellate Court is not contrary to any law or usage having the force of law nor is there any error or defect in the procedure. As such I find no force in this second appeal which is accordingly dismissed. However, under the circumstances of the case the parties are directed to bear their own costs.

The appeal was dismissed by a short order dated 16‑4‑1986. The above are the reasons in support of the said order.

S. Q. K‑19/ K. Appeal dismissed.

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