Tractor firm restrained from selling 954 tractors to third party

The Sindh High Court (SHC) has restrained a tractor firm from selling 954 tractors to any third party till further orders. The direction came recently on a high court appeal filed by businessman Shahzad Riaz against a single judge order in respect of 954 tractors.

The appellant’s counsel, Khawaja Shamsul Islam, submitted that the appellant had filed suit for recovery of amount towards KIBOR in respect of 954 tractors which were required to be delivered to the appellant pursuant to a conclusive contract towards purchase of 1,001 tractors from the respondent through an authorised dealer at a rate of Rs1,251,600 each prevailing at the relevant point of time including 5 per cent of sales tax.

He submitted that the total amount of sale consideration in sum of Rs1,252,851,600 was paid by the appellant through 91 pay orders which was received by the respondent without any objection and were still lying in the account of the respondent. The counsel submitted that despite receiving the entire sale consideration and availability of 1,001 tractors, the delivery of only 47 tractors was made immediately. He argued that the company was bound to deliver the remaining 954 tractors also within two months from the date of booking.

He submitted that the delivery of only 47 tractors was made immediately, whereas, the delivery of remaining 954 tractors was withheld without any factual or lawful excuse in spite of repeated requests in writing by the appellant, whereas, instead of fulfilling their contractual and legal obligation, the respondent demanded that the appellant increase/revise the price in the sum of Rs148,400 on each tractor in violation of the law, including the sections 4, 18, 19, 32, 33 and 34 of the Sales of Good Act 1930.

According to the counsel, once the entire sale consideration in respect of 1,001 tractors on the agreed price without any consideration of its enhancement or revision was received by the respondent and the part delivery of 47 tractors was also made, the contract between the parties became conclusive and the respondents were not justified to back off from such contractual obligations or demand any extra amount from the appellant on the pretext of revised price at a subsequent stage.

He submitted that the revised price was otherwise not applicable to the case of the appellant, and the previous price shall be applicable, hence non-delivery of the remaining 954 tractors and demand of enhanced price by the respondent besides being illegal and contrary to agreed terms of sale/purchase, was based on mala fide intention.

He submitted that the respondents neither made delivery of the remaining tractors, nor even acceded to the request of the appellant to refund the amount of 954 remaining tractors, on the contrary, insisted upon enhanced/revised price and also earned huge profits on the amount of the the appellant at the rate of 22 per cent profit from the bank.

It was argued that the appellant had prima facie a case for grant of interim relief, including delivery and/or attachment of the remaining 954 tractors, which were admittedly manufactured and ready to be delivered to the appellant as per booking orders, which included the names of customers, model, engine and chassis numbers of the tractors. The counsel requested the high court that the operation of the impugned order may be suspended, as it had rendered the suit of the appellant as redundant, whereas, none of the factors for grant of interim relief had been discussed or considered in the instant case.

He also sought a restraining order that the respondents may be directed not to sell 954 tractors of the specified model to any third party and deliver the same to the appellant, whereas, the appellant in all fairness, was willing to deposit the differential amount i.e. Rs.148,400/- per each tractor through a bank guarantee before the Nazir of the high court.

A division bench of the high court headed by SHC Chief Justice Aqeel Ahmed Abbasi after the preliminary hearing of the appeal issued pre-admission notices to the respondents and called their comments.

In the meantime, the bench ordered the appellant to deposit the differential amount Rs.148,400/- per tractor through a bank guarantee before the Nazir of this Court and restrained the respondents from selling 954 tractors to any third party till next date.