2003 C L C 250

2003 C L C 250

[Karachi]

Before Sabihuddin Ahmed and S. Ali Aslam Jafferi, JJ

RAZA HUSSAIN ‑‑‑Appellant

Versus 

MUHAMMAD KHAN and others‑‑‑Respondents

High Court Appeal No.3 of 1974, decided on 19th November, 2001.

Specific Relief Act (I of 1877)‑‑‑-

‑‑‑‑S. 12‑‑‑Transfer of Property Act (IV of 1882), S.52‑‑‑Transfer of Property and Registration (Sindh Amendment) Act (XIV of 1939), S.18‑‑‑Civil Procedure Code (V of 1908), O.XXIII. R.3‑‑‑Suit for specific performance of contract of sale‑‑‑Compromise between the parties‑‑‑Subsequent transferee of suit land‑‑‑Entitlement of‑‑‑Suit having been dismissed, plaintiff filed appeal against dismissal order‑‑‑During pendency of appeal compromise was arrived at between the parties‑‑­Defendants having sold suit property to subsequent transferees, during pendency of suit said transferees were also arrayed as defendants in the suit‑‑‑Plaintiff had urged that subsequent sale of suit land in favour of subsequent transferees during pendency of suit was hit by doctrine of lis pendens envisaged by S.52 of Transfer of Property Act, 1882 and said subsequent transferees did not acquire any legal interest in the suit property‑‑‑Subsequent transferees had pleaded that they were bona fide purchasers of the property for value without notice of alleged agreement of sale executed in favour of plaintiff by defendants‑‑‑Said transferees had further claimed that they were not party to compromise arrived at between the plaintiff and defendants‑‑‑Subsequent transferees had further contended that by virtue of Transfer of Property and Registration (Sindh Amendment) Act, 1939 bar on transfer in terms of S.52 of Transfer of Property Act, 1882 was attracted only if notice of pendency of suit was registered under S.18 of Transfer of Property and Registration (Sindh Amendment) Act, 1939, but no such notice had been so registered‑‑­Oompromise arrived at between plaintiff and defendants was binding on ,hem, but subsequent vendees who wen; not parties to such compromise were entitled to contest suit on basis of their plea of being bona fide purchasers for value without notice.

Faisal Khalid Daudpota for Appellant.

G.M. Qureshi for Respondents Nos. 1(a), (c), 2 and 4.

ORDER

This case has been received on remand from the Honourable Supreme Court. The brief facts appear to be that one late Raza Hussain, Advocate, the predecessor of the present appellants filed a suit, for specific performance of a control for sale of some immovable properties against the respondents claiming that one Mst. Shehar Bano. the predecessor and grandmother of the respondents Nos. 1 to 7 had agreed to sell 287 acres 5 Ghuntas of land comprising of survey numbers 12 to 28 in Hub Nadi Mangopir to him, but had failed to perform her obligations under the agreement. The respondents Nos.8 and 9 were arrayed as parties to the suit as it transpired that the respondents Nos. 1 to 7 had transferred 299 acres of land in Surveys Nos.7 and 12 to 27 in their favour, through a registered sale‑deed. The appellant's predecessor had also sought cancellation of the sale‑deed in favour of the respondents Nos. 8 and.9.

2. The suit was dismissed by a learned Single Judge of this Court insofar as the relief of specific performance was concerned, but a decree for Rs.4,000 alongwith 6% interest was awarded. The appellants preferred an appeal before a Division Bench, which came up for hearing in November, 1998. It was argued on merit for 3 days and was eventually dismissed vide judgment dated 12‑1‑1999 primarily on the ground that keeping in view the circumstances of the case and particularly the fact that Mr. Raza Hussain had acted as counsel of Mst. Shehar Bano in several matters relating to her property, she was entitled to the protections which the law affords to Pardanashin ladies and it had not been proved that she fully understood the implications of the agreements sought to be enforced.

3. The appellants preferred a petition for leave to appeal against the aforesaid before the Honourable Supreme Court and it was brought to the attention of their Lordships inter alia that during pendency of the appeal, an application under Order 23, rule 3 had been submitted and the following order was passed by Division Bench of this Court on 8‑10‑1980.

"8‑10‑1980. Mr. Abbas Zia for the Appellant.

Messrs Izzat Khan Jokhio and Kadirbux Junejo for Respondents Nos. 1 to 4, 5 and 6.

Mr. S.M. Sadiq for Respondents 8 and 9.

This is an application under Order 23, rule 3, C.P.C. whereby the appellant and respondents 1, 2, 4, 5 and 6 have compromises; their dispute in this appeal. Mr. S.M. Sadiq claims notice of this application. Mr. Abbas Zia undertakes to supply a copy of the application to him. The copy has now been supplied in Court and Mr. Sadiq waives notice.

Mr. Abbas Zia however, requests that since the concerned parties are present before the Court the compromise may be recorded and orders passed thereon after hearing Mr. S.M, Sadiq. Mr. Raza Hussain appellant is present in person. Respondent No.1 is present for himself and on behalf of respondents 2, 4, 5 and 6. He has produced for our inspection a general power of attorney given to him by respondents 2, 4, 5 and 6. The appellant and respondent No. 1 admit the contents of the compromise application. We record the compromise accordingly. The matter is deferred to a date in office of hearing Mr. S.M. Sadiq.

(Sd.) Judge.

(Sd.) Judge.

4. Accordingly the Honourable Supreme Court vide judgment dated 23‑12‑1999 converted the petition into an appeal set aside the order and remanded the matter to this Court to dispose of the compromise application in accordance with law.

5. Admittedly the respondents Nos.8 and 9 were not parties to the above compromise. Mr. Faisal Khalid however, argued that since the property was admittedly transferred to these respondents through a sale ­deed dated 29‑5‑1968 after the suit had already been filed and the respondents Nos. 1 to 7 had been duly restrained from alienating the property by an interim order the aforesaid respondents did not acquire any legal interest in the property. He urged that the transaction was hit by doctrine of lis pendens envisaged in section 52 of the Transfer of Property Act. Mr. G.M. Qureshi learned counsel for the respondents on tae other hand contended that by virtue of the Transfer of Property and Registration (Sindh Amendment) Act, 1939 (Act XIV of 1939) the bar on transfer in terms of section 52 is attracted only if notice of pendency of the suit is registered under section 18 of the Registration Act. Admittedly no such notice had been registered. Learned counsel further argued that after having transferred the property in favour of the respondents Nos.8 td 9 through a registered instrument, the respondents Nos. 1 to 7 had no legal interest left therein and as such the compromise dated 8-10-1980 was of no consequence.

6. We have carefully considered the respective contentions of the learned counsel who were also kind enough to provide us with written notes. We must observe that it does not befit the respondents Nos. 1 to 7 to contend that the compromise is inconsequential after having entered se same and might not have allowed such plea to be raised, though its gal force is worth considering.

7. Mr. Faisal Khalid learned counsel for the appellants in a well‑prepared and impressive address proceeded to argue that partial compromise or a compromise between some of the parties to the suit can be given effect to irrespective of the fact that some other parties were not privy to such compromise. He relied upon a number of cases but it is not necessary to discuss them as the legal proposition urged, in our view appears to be correct. Nevertheless, the matter does not end here. The respondents Nos.8 and 9 had simply pleaded that they were bona fide purchasers of the property for value without notice of the alleged agreement in favour of the appellants. Though an issue was struck on the basis of the above plea, no finding was recorded by the learned Single edge on the ground that the appellant/plaintiff had failed to prove the existence of an equity of specific performance in his favour and therefore, the issue was irrelevant. The above finding was also upheld in appeal.

8. Mr. G.M. Qureshi also appears to be right in contending that in the absence of registration of notice of the suit, a transfer of property to your of respondents Nos.8 and 9 may not be liable to be declared void for all purposes. Though the transfer may incur the penalty for breach of injunction order. At the same time, it is pertinent to keep in view that the to the property vesting in the respondents Nos.8 and 9 could not be destroyed by a unilateral compromise made by the transferors after they stood divested of such title.

9. For the foregoing reasons, we are of the view that the compromise dated 8‑10‑1980 is binding as between the parties thereto. However, the respondents Nos.8 and 9 are entitled to contest the suit on e basis of their plea of being bona fide purchasers for value without notice. The appeal is accordingly allowed to this extent and the suit is remanded to a learned Single Judge on the original side to decide the same on merits.

H.B.T./R‑81/K                                                                         Order, accordingly.