IN THE HIGH COURT OF SINDH AT KARACHI

SUIT NO. 394/2008

M/s Chevron Pakistan Limited

Versus
Shoaib Baghpati & Others

Affidavit in Rejoinder to the Counter Affidavit Filed by

Defendant No. 1 & 2 to the Application u/s Rule 1 and 2 of
Order 39, CPC of the Plaintif
I Muhammad Akhtar Khan son of Zahoor Ahmad Khan, Muslim ,
adult, resident of Karach, do hereby state on oath as under:
1. That I am the Manager Legal Affairs and duly constituted
Attorney of the Plaintiff Company and as such well conversant
with the facts of the case.
2. That I have gone through the contents of the Counter Affidavit
filed by Defendant No. 1 and 2 to the Application filed by the
Plaintiff Company for relief under Rule 1 and 2 of Order 39
CPC, and state that contents thereof save and in so far as
expressly admitted herein are hereby denied.
3. That as stated in the Plaint, in 1996, Plaintiff entered into
negotiation with Defendant no. 1 to establish and operate a
petrol pump on the Suit Property. As a result of the agreement
between Plaintiff and Defendant no. 1, Defendant no. 1 gave
possession of the Suit Property to the Plaintiff in 1998. In 1999,
the Suit Property was transferred to Defendant no. 2, who is a
business partner of her husband Defendant no. 1. Defendant no.

2 never raised any objection to the possession of the Plaintiff

over the Suit Property. After construction of petrol pump,
Plaintiff and Defendant no. 1 entered into further negotiations in
terms of which Defendant no. 1 in consideration of being
granted the dealership of the petrol pump agreed to confirm the
possession of the Plaintiff Company over the Suit Property and
also waived the condition of payment of rent for the possession
of the Suit Property. This arrangement between Defendant no. 1
and 2 and Plaintiff was further formalized in writing by way of
Petrol Pump Outlet License (Annex I to the Plaint). The Petrol
Pump Outlet License was entered into between Plaintiff on one
hand and on the other hand, Defendant no. 1 and his Legal
Heirs which included Defendant no. 2, as it could not be
validly entered into without her knowledge and consent.
Defendant no. 2 was therefore privy to the Petrol Pump Outlet
License though she was not expressly named therein.
4. That salient clauses of the Petrol Pump Outlet License are
reproduced below:
Whereas the Company has erected, constructed and
established at its own exclusive costs and its own
exclusive resources a petrol pump outlet, service and
filling station, alongwith its all allied, ancillary and
connected facilities including the petrol tanks, pumps,
dispensing units, pipes and pipelines, fittings and
fixtures, and building thereonThese facilities
hereinafter shall be referred to and termed as the
Facilities,. on a piece of land measuring 1000 sqy plot
no. ST-14 Scheme 36 Gulistan-e-Jauhar, Karachi, which
piece of land hereinafter shall be referred to and termed
as the Rented Premises. These Facilities and the
Rented Premises collectively and jointly hereinafter
shall be referred to and termed as the Petrol Pump
Outlet.
Whereas the Company is the absolute owner to the
entire exclusion of all others whatsoever he may be
including the licensee above named (SM Shoaib &
Legal Heirs) of the Petrol Pump Outlet. The said
premises and the said facilities being the Petrol Pump

Outlet as a whole, shall during the continuance of this

license, remain in sole, exclusive and physical
possession of the Company and no part of the said
facilities shall be removed nor shall the position of any
constituent part thereof shall be changed or altered by
the Licensee which right shall always remain completely
vested with the Company. The Company, its officers,
representatives and employees shall have at all times
unrestricted access to the Petrol Pump Outlet. The use
of the Petrol Pump Outlet by the Licensee for the
purpose of retail sale of the companys products shall be
in common with the company and all other persons
having a like right. The License shall not, in any way be
construed as creating any right, interest in favor of the
Licensee in respect of the Petrol Pump Outlet.
The grant of this License is on the following terms and
conditions to which the Licensee hereby undertakes and
accepts to observe and abide by:
11.2: No petroleum products other than those of the
Company shall be stocked in or marketed from the said
Petrol Pump Outlet.
11.14: Not to purport to sell, mortgage, hypothecate,
charge, assign, transfer, grant any license or otherwise
deal with said premises or said facilities to any person
firm or company; not to allow anyone to use the same
except the duly authorized employees of the Licensee,
whose names have been properly intimated to the
Company in writing
11.22: Each member of the Licensee firm and also every
other person for the time being and from time to time a
partner in the Licensees firm shall be jointly and
severally liable in respect of all matters herein contained
and shall be and remain liable herein notwithstanding
he has ceased to be a partner in the said firm unless and
until a written notice of that fact has been received by
the Company and its office at Karachi and the Company
shall have agreed in writing to relieve him of his
responsibilities

11.31: The Licensee shall immediately upon termination

of this License deliver to the Company or as the
Company may direct all stocks and all property of the
Company then in his possession or power. In the event
of Licensees failure to enable the Company or its
Representative to acquire the management and control
of the said premises, said facilities and said Petrol Pump
Outlet, including Companys equipment and other
movables on the expiry of the termination notice period,
the Licensee would be liable to pay to the Company Rs.
5000/- per day as damages till the vacant possession has
been handed over to the Company.
13: This License shall be deemed to have replaced any
other license or licenses executed between the Company
and the Licensee, in respect of the said premises and the
said facilities and the said Petrol Pump Outlet as a
whole as the case may be. Thus the contents of this
License shall prevail upon and have an overriding effect
on any other document to this effect.
22 (a): Upon termination of this License, the Licensee
shall cease to have any interest whatsoever in or to
remain on the said premises or to use the said facilities
or to interfere with the management of the Petrol Pump
Outlet. The Company will have absolute power to hand
over the said petrol pump outlet to any person or party.
22 (b): Upon termination for any cause whatsoever of
this license, the property and any petroleum products
then stored in the said facilities shall automatically
revert to and become vested in the Company, and the
Company shall be at liberty to remove or deal with the
same in any manner it thinks fit, reimbursing to the
Licensee the cost on the purchased rates for the
petroleum products taken over. In case the Licensee
shall have any other property of his own on the said
Petrol Pump Outlet they shall unless otherwise agreed
upon in writing by the Company, remove it from the
said premises with immediate effect from the date of said
termination

22 (c): Upon termination of this License for any cause

whatsoever, the Company shall prepare or cause to be
prepared an inventory of all articles, stock, furniture,
equipment, etc. lying on the said premises. One copy of
the said inventory will be supplied to the Licensee and
any money due to them in respect of stock and
furniture, if any, belonging to the Licensee, shall be
adjusted against any amount due to the Company and
balance, if any, shall be paid to the Licensee. The said
inventory shall be signed by the Licensee and the
Company respectively; provided that if the Licensee do
not present themselves at the time of the preparation of
the said inventory, or refuse to sign, the Company shall
be at liberty to prepare the same in the absence of the
Licensee and the contents and the correctness of the
inventory so prepared shall not be called in question by
the Licensee
23: In case any question, difference of opinion, dispute
of any nature arises between the Company and the
Licensee as to interpretation, meaning, understanding,
construction of the provisions, contents, terms and
conditions of this License, or as to rights, duties,
allegations and outstanding or any other matter arising
from and/or concerned with the subject matter of this
license, the same shall be referred to two arbitrators, one
nominated by each party to this License. If either party
neglects or fails to appoint his respective arbitrator
within seven days after appointment of arbitrator by the
other party, or serving a notice in writing upon the
failing party, the arbitrator so appointed by one party
shall assume the status of sole arbitrator. The arbitrators
so appointed by the parties to this license or the sole
arbitrator, as the case may be shall decide the reference.
In case of difference of opinion, in arriving at a decision,
each arbitrator shall record his findings separately, and
shall refer the case to an umpire duly appointed by the
two arbitrators in consultation with and taking in the
confidence the parties to the reference. Upon reference
by the two arbitrators, the umpire shall decide the
reference. While deciding the reference the sole
arbitrator, the two arbitrators or the umpire, as the case
may be, shall observe, adhere to and comply with the

provisions of Arbitration Act 1940 which will be

applicable mutatis mutandis as far as they may be made
applicable.

5. That it is established from the above that Plaintiffs possession

over the suit property delivered to the Plaintiff as far back as in
1998 is admitted by Defendant no. 1 and 2 to be juridical
possession. That Defendant no. 1 and 2 after 1998, when
possession was delivered to Plaintiff, never objected to the
possession of the Plaintiff and never called it into question or
interfered with it at any time. In 2004, Petroleum Pump Outlet
License was executed between Plaintiff and SM Shoaib & Legal
Heirs (Defendant no. 1 and 2) in which the possession of
Plaintiff was duly acknowledged alongwith ownership of the
facilities and buildings constructed on the suit property. Even
after 2004 till the illegal dispossession of Plaintiff, Defendant no.
1 and 2 never objected to the possession of Plaintiff or interfered
with it. In this view, possession of Plaintiff is protected under
section 53-A of the Transfer of Property Act read with Article
114 of the Qanoon-e-Shahadat Order, 1984.
6. That it is also established that Plaintiff was supplying its
petroleum products to the Defendants based on the Petrol Pump
Outlet License, 2004 till 28-01-2008 as is evident from the sales
tax invoices in relation to said supplies (Annex J/1 to J/9 to the
Plaint) and Plaintiff was also maintaining the Petrol Pump
during the said period as is evident from the maintenance
reports (Annex K/1 to K/7 to the Plaint). It is also established
that Plaintiff had heavily invested at the petrol pump outlet in
shape of equipment, fixtures, fittings, buildings and other
material which is valued in excess of about Rs. 8.9 million
(Annex-L to the Plaint).
7. In view of above, Defendants were legally bound to honor their
commitments in terms of the Petroleum Pump Outlet License
2004 which they have failed to do. Hence this suit of recovery of
possession and declaration and permanent injunction regarding
carrying out of the contractual obligations of the Defendant no.
1 and 2. It may further be seen that parties had solemnly
contracted in terms of clause 23 of the Petroleum Pump Outlet

License 2004 that in case any question, difference of opinion, dispute of

any nature arises between the Company and the Licensee as to interpretation,
meaning, understanding, construction of the provisions, contents, terms and
conditions of this License, or as to rights, duties, allegations and outstanding
or any other matter arising from and/or concerned with the subject matter of
this license, the same shall be referred to two arbitrators. In this view,

Defendant no. 1 and 2 are clearly in breach of their contractual

obligations to refer matters of dispute to arbitration when on the
pretext of non-issuance of Explosive License to Plaintiff, they
unilaterally relieved themselves from their legal obligations
under the Petroleum Pump Outlet License 2004 and not only
dispossessed Plaintiff from the Suit Property but also collusively
with Defendant no. 3 granted a Lease of the Suit Property to
Defendant no. 3 and started selling petroleum products of
Defendant no. 3 from the Suit Property; all the foregoing were in
utter disregard and breach of their undertakings in the
Petroleum Pump Outlet License 2004.
8. That Defendant no. 3 has acted in collusion with Defendant no.,
1 and 2 to deprive Plaintiff from his valuable legal rights and
therefore is guilty of inequitable conduct and is not entitled to
be considered for any kind of relief by this honorable Court.
Defendant no. 3 is also not a bona fide transferee of the rights of
the Plaintiff as it failed to make even routine inquiries regarding
the nature of possession of the Plaintiff and its interests in the
Suit Property and the business carried on over it. In this view
also Defendant no. 3 is not entitled to be considered for any
indulgence by this honorable Court. The foregoing is
established by the letter dated February 11, 2008 written by the
Chairman and CEO of Defendant no. 3 to the Country
Representative of the Plaintiff Company in reply to latters letter
dated February 1, 2008 (Annex M/4 and M/1 to the Plaint):
We would once again like to make it clear that the
owner of above petrol pump site bearing plot no. ST -14
Block 10, Gulistan-e-Jauhar Karachi, approached HSL
for extending its franchise to operate the retail outlet at
the said plot, explicitly giving HSL to understand that
there was neither any existing lease agreement nor the
franchise/dealership or any other agreement obliging the

dealer to operate the said retail outlet under any other

brand. HSL was further assured that Caltex do not have
any title to the land and have not paid rent to the
dealer/landlord of the site and as such he was at liberty
to acquire the franchise of HSL in respect of the retail
outlet. Hence HSL was not aware of any existing
dealership license agreement or any contractual
obligation that Chevron Pakistan may be having with
its dealer.

9. That based on above, I would say that Plaintiff has a good prima
facie case and balance of convenience is also in his favor. If
application u/s Rule 1 and 2 of Order 39 CPC is not granted,
Plaintiff would suffer irreparable loss in terms of reputation and
revenues. I would also say that based on above, defendants are
not entitled to grant of any indulgence and relief claimed
against them is just, equitable and requisite.
10. That I would say that Plaintiffs entire case will be seriously
prejudiced if relief prayed for in the Application is not granted
and defendants are allowed to play fast and loose with their
solemnly entered into contractual obligations with connivance
of opportunist parties.
11. That whatever has been stated from Para 1 to 10 above is true
and correct according to my best knowledge and belief.

Deponent