Amir Waheed Shah & others vs Ajmal Khan & others
This appeal before the Supreme Court of Pakistan arose out of a pre-emption suit filed under the Khyber Pakhtunkhwa Pre-emption Act, 1987. The plaintiff sought to pre-empt a land sale (mutation No. 1809) made to a female buyer who immediately transferred the property to her sons via a gift mutation (mutation No. 1810). The trial court dismissed an application under Order VII Rule 11 CPC for rejection of the plaint, but the revision court allowed it due to the plaintiff's failure to make Talbs regarding the subsequent gift transaction. The High Court reversed this on a constitutional petition, remanding the matter. The Supreme Court considered whether a subsequent gift transaction made to defeat pre-emption could be ignored or pre-empted without fulfilling the statutory requirement of Talbs. The Supreme Court held that while legitimate devices to avoid pre-emption are permissible, a plaintiff challenging a disguised transaction must still perform the mandatory Talbs regarding the subsequent transfer. Furthermore, a genuine gift is not subject to pre-emption under Section 2(d) of the Act. Rejection of the plaint was accordingly restored.
- Can a transaction structured as a gift be pre-empted under the Khyber Pakhtunkhwa Pre-emption Act, 1987?
- Is a plaintiff required to perform mandatory Talbs regarding a subsequent transfer claimed to be a disguised sale to maintain a pre-emption suit?
- Does a legitimate legal device to avoid pre-emption constitute an illegal transaction in pre-emption law?
- Khyber Pakhtunkhwa Pre-emption Act 1987
- Section 2(d), Khyber Pakhtunkhwa Pre-emption Act 1987
- Order VII Rule 11, Code of Civil Procedure 1908
- Section 115, Code of Civil Procedure 1908
- Article 199, Constitution of Pakistan 1973
ORDER
Shahid Waheed, J. The defendants are the appellants in this appeal.
2. The suit by respondent No.1 (plaintiff) was one for possession under the Khyber Pakhtunkhwa Pre-emption Act, 1987 (Act). The subject matter of the suit was land measuring 1-Kanal, 9-Marlas, and 41/2 sarsahi, which was sold to Mst. Gul Zahira Bibi (now represented by her legal heirs), respondent No. 2 herein, vide mutation No.1809 dated 28th of November, 2012. A perusal of the record suggests that immediately upon sanctioning of sale mutation, Mst. Gul Zahira Bibi gifted the land to her sons (appellants herein) by mutation No.1810.
3. The respondent No.1 (plaintiff), on the ground of his superior right, sought to pre-empt the sale made in favour of Mst. Gul Zahida Bibi and asserted that the subsequent transaction of gift in the form of mutation No.1810 was illegal. He also issued a notice of Talb-i-ishhad to Mst. Gul Zahira Bibi.
4. During the trial, application under Order VII Rule 11 of the CPC was filed to reject the plaint on the ground that respondent No.1 (plaintiff) had not made any Talb to pre-empt the transaction recorded in mutation No.1810. This application was dismissed by the Trial Court by order dated 8th of June, 2013. The appellants-defendants then filed an application under Section 115 of the CPC before the Additional District Judge-II, Bannu and sought revision of the order made by the Trial Court. This revision was allowed, and the plaint was rejected vide order dated 20th of September, 2013. The respondent No.1 (plaintiff), thereupon, filed a petition under Article 199 of the Constitution of the Islamic Republic of Pakistan, 1973, before the High Court. This petition was allowed by the impugned judgment dated 11th of September, 2014, and the case was remanded to the Trial Court with the direction to decide the suit afresh after providing opportunities to the parties to produce their evidence. Hence, this appeal.
5. We have heard both sides. It is now well settled that the right of pre-emption arises when the sale of land occurs. The sale, per the definition provided in Section 2(d) of the Act, does not include a gift. In the present case, the land was first sold to Mst. Gul Zahira Bibi vide mutation No.1809, and before this sale could be pre-empted, it was further transferred to the present appellants by way of gift mutation No.1810. According to respondent No. 1 (plaintiff), the second transaction was sham and illegal. It is to be noted that in a suit for pre-emption, the validity of the transaction is not examined; however, the nature of the transaction may be determined. It also needs to be clarified here that a marked distinction exists between a devise and disguise. Device is permitted but not disguise. When transaction has been given a false colour to evade third party rights, it is not only the function but also duty of the Court to remove veil, see through disguise and then to determine real and true character of transaction. A person is also equally entitled to evade law of pre- emption by all lawful and legitimate devices, like gift, exchange etc. So, in the given circumstances of the case, respondent No. 1 (plaintiff) could not ignore the gift mutation while making his demand.
The appropriate course for him was to say, firstly, that the second transaction was a sale, but to defeat his right of pre-emption, it had been dubbed as a gift; and secondly, that he had made all the requirements of Talbs regarding the second transaction. On the contrary, a perusal of the contents of the plaint shows that neither any Talb was made to pre-empt the second transaction nor any notice of Talb-i-ishhad was sent to the present appellants. This was fatal. Still, there was another flaw: the last transaction was in the nature of a gift; and this could not be pre-empted under the provision of the Act. All these facts escaped the consideration of the High Court, and thus, its judgment cannot be sustained.
6. In the result, this appeal is accepted, the judgment dated 11th of September, 2014, made by the High Court is set aside, and consequently, the order dated 20th of September, 2013, passed by the Additional District Judge-II, Bannu, is restored.