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(a) Contract Act (IX of 1872)‑‑

‑‑‑S. 55‑‑Specific performance of contract of sale of immovable property‑‑Principle that time is generally not essence of the contract is not absolute rule but one which is rebuttable‑ ‑Whether time is of essence of a contract is a controversy of fact determinable from attendant circumstances of each case and depending on the intention of the parties gatherable from the agreement itself and subsequent conduct of parties.

(b) Contract Act (IX of

1872)‑‑

‑‑‑S. 55‑‑Civil Procedure Code (V of 1908), S. 100‑‑Specific performance of contract of sale of immovable property‑‑Second appeal‑‑Question that time was not of essence of the contract could not be allowed to be raised in second appeal especially when such question was neither set up in the pleadings nor canvassed by appellant before Lower Appellate Court and not only that the said ground was not even specifically taken in memorandum of second appeal as well‑ Such question being a controversy of fact, said plea has to be specifically set up in the pleadings and converted into issue so as to be appropriately and effectually adjudicated upon by giving parties a chance to support their respective stance by production of evidence etc.

(c) Specific Relief Act (I of

1877)‑‑

‑‑‑S. 42‑‑Specific performance of agreement to sell immovable property‑‑Decree for‑‑Time when not of essence of contract‑‑Decree for specific performance can be refused even if time was not of the essence of contract but other reasons justify such a refusal‑‑Plaintiff's delay in performance of a contract may make specific performance of contract inequitable where situation of parties or of property during delay has changed and property has largely increased in value or where there are reasonable grounds to legitimately infer that plaintiff delayed the performance of the contract with a view to speculate for the purpose of awaiting a turn favourable to himself.

Commentary from Corpus Juris Secondum Vol. 81 at pages 983 and 984 ref.

(d) Specific Relief Act (I of

1877)‑‑

‑‑‑S. 42‑‑Contract Act (IX of 1872), S.55‑‑Suit for specific performance of agreement to sell immovable property‑‑Plea that time was not of essence of contract, when can lead to grave injustice (obiter).

A plea to the effect that time was not of essence of the contract for sale of immovable property cannot but lead to grave injustice in some cases. In this connection it may be stated that parties normally settle the terms of the contract to sell property (including price thereof) with reference to the date fixed for its performance. If the said date was not to be adhered to on the ground of the same not being of the essence of the contract, a dishonest prospective purchaser would postpone purchase of property with impunity and would take undue advantage by seeking to enforce the contract for purchasing property at the contracted price long after the date fixed for performance thereof and at a time when the price of the property might have enormously risen. This cannot but be regarded as abuse of process of law and the Courts will be loath to countenance such an abuse.

Consequently such a plea should not be readily entertained or given effect to especially in claims for discretionary relief.

Debendra Nath Mandal v. Sakhilal Kar and others A I R (37) 1950 Cal. 526; Malik Ghulam Jilani v. Malik Munir Ahmad Khan and others P L D 1960 (W.P.) Kar. 517; Abdul Hamid v. Abbas Bhai Abdul Hussain Sodawaterwala P L D 1962 S C 1; Madan Choudhry and others v. Kamaldhari Thakur and others A I R 1930 Pat. 121; Bank of Bahawalpur Ltd. v. Punjab Tanneries, Wazirabad Ltd. and 2 others P L D 1971 Lah. 199; Sree Lal Chamaria v. Hariram Goenka and another AIR 1926 Cal. 181; Abdul Karim v. Muhammad Shafi and another 1973 S C M R 225; Allah Ditta v. Mst. Rasoolan Bibi and 7 others 1976 S C M R 459; Govt of West Pakistan (Now Punjab) through Collector, Bahawalpur v. Haji Muhammad P L D 1976 S C 469 and Commentary of Corpus Juris Secondum Vol. 81 at pages 983 and 984 rel.

Sh. Muhammad Nasim for Appellant. Mian Saeed‑ur‑Rehman Farrukh for Respondents. Dates of hearing: 11th, 13th May and 15th .Tune, 1985.

By this judgment I propose to dispose of R.S.As. Nos.106 and 107 both of 1979 as these are directed against the same judgment and decree of the learned Additional District Judge, Sialkot dated 11‑10‑1978.

2. The facts of the case, briefly stated, are that the plaintiff appellant instituted a suit against the respondents in the Court of Civil Judge, 1st Class, Sialkot for specific performance of an agreement of sale. It was averred in the plaint that an agreement of sale was executed on 24‑1‑1970 by Shah Muhammad defendant‑respondent No.l on his own behalf and on behalf of his brother Rehmat Ali, defendant respondent No.2 for sale of agricultural land measuring 20 kanals with the stipulation that sale‑deed will be registered by the defendants‑respondents in favour of the plaintiff‑appellant before 28‑2‑1970; that the sale price fixed was Rs.7,000 that Rs.1,000 had been paid as earnest money at the time of execution of the agreement and the balance was to be paid at the time of registration of the sale‑deed; that if the defendants‑respondents failed to get the sale‑deed registered as stipulated in the agreement, the plaintiff appellant would be entitled to enforce specific performance of the contract through Court; and that if the appellant did not perform his part of the contract the earnest money shall stand forfeited. Further averment in the plaint was that the plaintiff‑appellant approached the defendants‑respondents a number of times before the last date fixed for registration of the sale‑deed but they postponed the matter which obliged the plaintiff‑appellant to file the suit on 30‑6‑1972.

3. The defendants‑respondents resisted the suit. It was, inter alia, asserted by them that it was the plaintiff‑appellant himself who did not get the sale‑deed registered as he had no money to make payment of the balance consideration of Rs.6,000; that he did not even turn up on 28‑2‑1970 before the Sub‑Registrar; that subsequently a notice was served upon the plaintiff‑appellant informing him that he had failed to appear before the Sub‑Registrar alongwith the balance consideration and, therefore, the agreement of sale stood cancelled and the earnest money confiscated. It was also asserted by the defendants‑respondents that the suit was not maintainable on account of the conduct of the plaintiff‑appellant; and that it had not been correctly valued for purposes of court‑fee.

4. On the divergent pleadings of the parties the following three issues were framed by the learned trial Court:

(1) Whether the plaintiff was ready and willing to perform his part of the contract before the stipulated date and the defendants are to be blamed for non‑performance of agreement of sale OPP

(2) Whether the agreement of sale came to an end on 28‑2‑1970 OPP

(3) Relief.

5. The learned trial Court under issue No. 1 held that though the plaintiff‑appellant did not appear before the Sub‑Registrar on 28‑2‑1970 he had been willing and ready to perform his part of the contract and for his failure to appear on the fixed date the only penalty entailed was the confiscation of earnest money. Under issue No.2, the learned Civil Judge found that the contract did not stand annulled. He in view of his above findings decreed the suit of the plaintiff‑appellant by his judgment dated 30‑1‑1975 and directed the defendants‑respondents to get the sale‑deed registered in favour of the plaintiff‑appellant on receipt of the sum of Rs.7,000.

6. The respondents feeling dissatisfied with the aforementioned judgment and decree of the learned trial Court dated 30‑1‑1975 preferred two separate appeals before the learned Additional District Judge, Sialkot which were dealt with by him together and he by his judgment dated 11‑10‑1978 accepted the appeals of the respondents and setting aside the judgment and decree of the trial Court dismissed the suit of the plaintiff‑appellant leaving the parties to bear their own costs. Hence the present appeals.

7. The learned counsel for the appellant has raised the following contentions: ‑

(i) That the learned lower Appellate Court reversed the findings of the learned trial Court illegally and did not take into consideration the position that time was not of the essence of the contract of sale in question;

(ii) That the mention of a particular date in the agreement by which the sale‑deed was to be got registered would not make time as essence of the contract. He relied in this regard on Debendra Nath Mandal v. Sakhilal Kar and others reported as AIR (37) 1950 Cal. 526, Malik Ghulam Jilani v. Malik Munir Ahmad Khan and others reported as PLD 1960 (W.P.) Kar. 517 and Abdul Hamid v. Abbas Bhat‑Abdul Hussain Sodawaterwala reported as PLD 1962 S.C. 1; and

(iii) That there being no specific stipulation in the contract of sale that it would stand rescinded if the vendee‑appellant failed to get it registered and the only stipulation being that the earnest money would be forfeited it is obvious that time was not of the essence of the contract.

8. On the contrary, the learned counsel for the respondents submitted

First, that the plea that time was not of the essence of the contract having not been raised before the Courts below nor the same having been converted into an issue it could not appropriately be raised at the stage of second appeal;

Secondly, That the intention of the parties that time was of the essence of the contract had been made clear by specifying a date and by not giving a length of period within which the sale‑deed was to be executed;

Thirdly, that the appellant‑plaintiff has not established his case for getting specific performance of the contract through Court as in order to succeed in a suit for specific performance the plaintiff has to establish his willingness and continued readiness from the date of contract till its finalization in which the appellant‑plaintiff has miserably failed as is apparent from the following factors:

(a) The appellant did not take any step for execution of the sale‑deed for a long time after the expiry of the date fixed for registration thereof;

(b) He did not buy stamps for execution of the sale‑deed;

(c) He never gave any intimation to the defendants of his intention to have the contract enforced; and

(d) Despite notice he did not appear before the Sub‑Registrar with the balance consideration.

The learned counsel in support of his above contention placed reliance on Madan Choudhry and others v. Kamaldhari Thakur and others reported as AIR 1930 Patna 121;

Fourthly, that otherwise also grant of a decree for specific performance of a contract is a discretionary relief and the Court is not bound to decree such a suit merely because it is lawful. The Court has also to see the conduct of the person asking for such relief as also his readiness and willingness and capacity to make payment. Reliance placed in support of the above contention on Bank of Bahawalpur Ltd. v. Punjab Tanneries, Wazirabad Ltd. and 2 others reported as PLD 1971 Lahore 199 and Sree Lal Chamaria v. Hariram Goenka and another reported as AIR 1926 Cal. 181;

Fifthly, that the clause of forfeiture of earnest money embodied in the sale agreement of necessity implies the rescinding of the contract and it being the admitted position that the earnest money could be forfeited and in fact stood forfeited, the contract shall be deemed to have been rescinded and annulled. Sree Lal Chamaria v. Hariram Goenka and another reported as AIR 1926 Cal. 181 was cited in support of the above contention; and

Lastly, that there being difference in the measurement of land which was actually in the ownership of the vendor and that which was contracted to be sold, the contract was not enforceable. Reference in this regard was made to Abdul Karim v. Muhammad Shaft and another reported as 1973 SCMR 225.

9. The principle that time is generally not of essence of the contract is not an absolute rule but one which is rebuttable meaning thereby that whether time is of essence of a contract or not is a controversy of fact determinable from the attendant circumstances of each case and depending on the intention of the parties gatherable from the agreement itself and subsequent conduct of the parties.) Being a controversy of fact such a plea has to be specifically set up in the pleadings and converted into an issue so as to be appropriately and effectually adjudicated upon by giving the parties a chance to support their respective stance by production of evidence etc.

10. In the case in hand there is no issue framed in the suit as to whether time was of the essence of the contract or not. In fact even the plea that time was not of essence of the contract had not been set up by the plaintiff‑appellant. There is no adjudication of this controversy either by any of the Courts below. The first point to be seen, therefore, is whether at the stage of second appeal the question that time was not of essence of the contract can be allowed to be raised especially when this was neither set up in the pleadings nor canvassed by the appellant before the lower Appellate Court and not only that the ground is not even specifically taken in the present memos of appeals as well.

11. In the foregoing circumstances and in view of the well‑settled principle that a party cannot be allowed to found its case on a plea of fact not raised in the pleadings, I am afraid I cannot allow the said plea to be canvassed for the first time in the second appeal. My this view finds support from the dicta of the learned Supreme Court contained in Allah Ditta v. Mst. Rasoolan Bibi and 7 others (1976 SCMR 459) and Govt. of West Pakistan (now Punjab) through Collector, Bahawalpur v. Haji Muhammad (PLD 1976 S.C. 469). The appeals thus stand concluded against the appellant by the above finding.

12. It may also be pertinently observed that the contentions "thirdly" and "fourthly" raised as above on behalf of the respondents have also force. It has been correctly pointed out by the learned counsel for the respondents that a decree for specific performance can be refused even if time was not of the essence of contract but other reasons justify such a refusal, for example, the plaintiff's delay in performance of a contract may make the specific performance of the contract inequitable where the situation of the parties or of the property during the delay has changed and the property has largely increased in value or where there are reasonable grounds (some of which have been indicated by the learned counsel for the respondents in sub‑paras (a), (b), (c) and (d) of the contention "thirdly" to legitimately infer as in the case in hand that the plaintiff appellant delayed the performance of the contract with a view to speculate for the purpose of awaiting a turn favourable to himself. The above view has been supported by the learned counsel for respondents by quotations from the comentary at pages 983 and 984 of Vo1.81 of Corpus Juris Secondum.

13. Before parting with the case, however, I cannot help observing even though as obiter that a plea to the effect that time was not of essence of the contract for sale of immovable property cannot but lead to grave injustice in some cases. In this connection it may be stated that parties normally settle the terms of the contract to sell property (including price thereof) with reference to the date fixed for its performance. If the said date was not to be adhered to on the ground of the same not being of the essence of the contract, a dishonest prospective purchaser would postpone purchase of property with impunity and would take undue advantage by seeking to enforce the contract for purchasing property at the contracted price long after the date fixed for performance thereof and at a time when the price of the property might have enormously risen. This cannot but be regarded as abuse of process of law and the Courts will be loath to countenance such an abuse. Consequently, I am clear in my mind that such a plea should not be readily entertained or given effect especially in claims for discretionary relief.

14. In view of the foregoing discussion I find no merit in these appeals which are accordingly dismissed with costs.

M.B.A./A‑168/L Appeals dismissed.

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