NOOR MUHAMMAD Versus KARACHI DEVELOPMENT AUTHORITY

Z. A. CHANNA J. ‑This constitutional petition calls in question an order, dated 29th September 1967, passed by the Karachi Development Authority, respondent No. 1 herein, cancelling the allotment of a plot which had been granted to Usman Haji Ghani, the predecessor‑in‑title of the petitioners herein.

2. The facts, which form the background of this petition, may be briefly stated thus:

Usman Haji Ghani, the predecessor‑in‑title of the petitioners herein, had applied for and was granted on 28‑9‑1953, plot No. C‑8, in K. D. A. Scheme No. 1, on certain prescribed conditions, one of them being that the construction on the plot, in accordance with the plans approved by the K. D. A., was to be completed by the allottee within two years from the date the delivery of the plot was given to the allottee. Usman Haji Ghani paid the full occupancy price for the plot in 1960, but possession of the plot was delivered to him on 19‑8‑1964. He was thus required, in terms of the allotment order, to complete construction of the plot by 18‑8‑1966. On 29‑7‑1965, Usman Haji Ghani submitted through his Architects, M/s. Khambatta & Co., plans for raising construction on the plot and pending approval of the plans, a compound wall was erected on the plot. The said plans have not been approved till now, and according to respondents herein, the Architects Control Department of the K. D. A. raised certain objections to the plans and on 9‑8‑1965 communicated the same for compliance to M/s. Khambatta & Co., but it was only on 28‑8‑1966 that another Architect of Usman Haji Ghani submitted fresh plans, complying with the objections of the K. D. A's. Architect Control Department. In the meanwhile, since the period of two years within which the approved construction had to be raised on the plot had expired, a show‑cause notice was issued by the K. D. A. to Usman Haji Ghani on 7‑8‑1967, for cancellation of the plot. To this show?cause notice, a reply was sent by Usman Haji Ghani on 16‑8‑1967, through his Advocate, stating that though plans had been submitted for putting up construction, the same had not yet been approved and as such it was not possible for the allottee to raise construction on the plot. It was further explained in the reply that because of the aggression committed by India against Pakistan in September 1965 there had been a serious set‑back in the construction work all over Pakistan and this, too was a factor which should be taken into consideration. A request was accordingly made for an extension of one year in the period within which the construction was to be raised on the plot. The K. D. A. apparently found this explanation unsatisfactory, and by an order dated 29‑9‑1967, it cancelled the allotment of the plot. Usman Haji Ghani thereupon, on 6th October 1967, made a representation to the Director, Lands and Estate Department and also to the Assistant Administrative Officer (1), of the K. D. A., requesting for reconsideration of the order of cancellation of his plot and for an interview. The K. D. A., by its letter dated 26‑10‑1967 advised Usman Haji Ghani that as the allotment had been cancelled by the Chairman, K. D. A., a review petition should be filed before the Chairman, Usman Haji Ghani thereupon, on 26‑10‑1967, submitted a review petition to the Chairman. This was followed by three reminders, respectively dated 20‑11‑1967, 20‑1‑1968 and 1‑3‑1968, but the K. D. A., by its letter dated 28th March 1968, regretted that "no assistance can be rendered in the matter at this stage." A review petition was also filed before the Commissioner, Karachi, who incidentally was also the Chairman of the K. D. A., but it is not known as to what decision was taken on the said petition. Subsequently, on 29‑6‑1968, Usman Haji Ghani learnt that the K. D. A. was proposing to allot the plot in question to another party and hence sent a telegram to the K. D. A. on 29‑6‑1968, followed by a letter from his Advocate of the same date. However, these had no effect and the K. D. A., on 29‑6‑1968, allotted the plot in favour of respondent No. 2 and on 6‑7‑1968, executed a lease deed in his favour on his paying the occupancy price of the plot. The K. D. A. thereafter started to demolish the compound wall raised by Usman Haii Ghani, and it was at this stage that Usman Haji Ghani filed the present constitutional petition and obtained a status quo order from the Court after para‑wise comments were called for from the K. D. A. Usman Haji Ghani died during the pendency of his petition and hence the petitioners herein, who are his legal successors, have been brought on record.

3. We have heard Mr. Z. A. Valliani, the learned counsel for the petitioners, Mr. Shamsul Haq Memon, the Legal Advisor of the K. D. A., and Mr. Nasir Khan, who represents respondent No. 2. The grounds urged by Mr. Valliani in support of the petition are; firstly, that as Usman Haji Ghani had submitted the plans to K. D. A. the latter was not entitled to cancel the allotment unless the plans were approved and soma time was given to the allottee to raise construction on the plot; secondly, that according to the letter, dated 30‑9‑1967, from the K. D. A., copy whereof was forwarded to M/s. Khambatta & Co., the Architect was allowed 14 days from the date of the letter for complying with the objections of the Architect (Control), but before the expiry of the said letter, the K. D. A. cancelled the allotment of Usman Haji Ghani and allotted it to respondent No. 2; thirdly that no proper opportunity was given to Usman Haji Ghani to show cause or represent his case before the allotment was cancelled; fourthly, that no action has been taken on his review petition; and finally that the K. D. A., and the Commissioner have acted in a mala fide, unjust and arbitrary manner. In support of his contentions, the learned Advocate relied upon the decisions reported as East & West Steamship Company v. Pakistan (P L D 1958 S C (Pak.) 41) and Mohammad Shafi v. Lahore Improvement Trust (P L D 1959 Lah 1).

4. Mr. Shamsul Haq Memon, on the other hand, replied upon Condition 13 of the terms and conditions of allotment of residential plots in K. D. A. Schemes, Regulation 28 of the K. D. A. Allotment Regulations and paragraph 14 of the K. D. A Building Regulations, 1961. His precise argument was that under the terms and conditions of the allotment of Usman Haji Ghani, he was required to complete the approved construction on the plot within two years of the date of delivery of possession of the plot and in case of failure to do so within the said period or any further period which the Chairman, K. D. A., in his sole discretion could extend, the K. D. A. was fully competent to cancel the allotment. He contended that Usman Haji Ghani had failed to complete or even to commence construction on the plot and, therefore, allotment of the plot had been rightly cancelled. He further contended that the cancellation was made after taking into consideration the representations of and the reply to the show‑cause notice issued to, Usman Haji Ghani. In respect of the review petitions, his contention was that the first petition had been rejected as there was found to be no merit in it, but in respect of the second petition, he was unable to state precisely as to what had been its fate. He, however, urged that since even the petitioners had not contended that it had been granted, it is to be presumed that it had also been rejected and that in any case there was no provision in the rules for a second review. Mr. Shamsul Haq Memon finally contended that the act complained of being within the discretionary field of the K. D. A., and its Chairman, was not susceptible to interference in the exercise of writ jurisdiction, and i n support of this contention he relied upon the observations made by Cornelius, C. J., in Faridsons Ltd. v. Government of East Pakistan (P L D 1961 S C 537).

5. Mr. Nasir Khan, the learned counsel for the new allottee (respondent No. 2), contended that under the rules there was no power of review and hence no review application could be entertained; that in any case, the review petition was rejected, vide the letter of the K. D. A., dated 28th March 1968, and that the letter from the Architect (Control) of the K. D. A., dated 30‑9‑1967, could not be construed as an extension in the period for raising construction nor had he power to do so. He further pleaded that despite adequate time being afforded to Usman Haji Ghani, that latter had wilfully defaulted in raising construction on the plot, and therefore, allotment in his favour was rightly cancelled. He finally contended that the allotment order, together with its terms and conditions, should be treated as an agreement and for breach of agreement writ jurisdiction could not be invoked. In support of this contention he placed reliance on the decision in the case of Shamshad Ali v. Commissioner (1967 S C M R 122).

6. The Allotment Regulations, which have been framed by the K. D. A. under Article 5 of the K. D. A. Ordinance, 1957, and the terms and conditions for allotment of residential plots in K. D. A. Schemes, which are Appendix `A' to the said regulations, were published in the Gazette of West Pakistan, August 27, 1965, and can have prospective effect only, except in respect of purely procedural matters, Similarly, the Karachi Building Regulations were framed in 1961. On the other hand, the plot was admittedly allotted to Usman Haji Ghani, in September 1953, much before the K. D. A. order came into force, though its possession was given to him in August 1964. The petitioners' rights in the plot are thus to be governed by the terms and conditions stated in the application for allotment and the allotment order. However, even according to the printed application form, which bears the signature of Usman Haji Ghani, he was required to obtain sanction of the K. D. A. for the plans and specifications in respect of the construction to be raised on the plot and to complete, in accordance with the approved plans and specifications, the construction on the plot within two years from the date of permission to enter upon the plot for the purposes of erecting the building or within such extended period as the Chairman may, in his sole discretion, grant in writing. Paragraph 19 of the application form specifically provides that in case of breach of any of the conditions stated in the application form, the K. D. A. would have the right, by notice in writing, to cancel the allotment. This, however, does not mean that the K. D. A. or the Chairman would act in an arbitrary, discriminating or in a capricious manner or that the allottee was not to be given a fair opportunity of representing his case or that any representation or cause shown by him was not to be examined or taken into consideration. In the case of East & A West Steamship Co., the Supreme Court has laid down that the High Court in the exercise of its writ jurisdiction has ample power to grant relief to the aggrieved party where a statutory functionary acts mala fide or in a partial, unjust or oppressive manner or where statute is being administered by a functionary in a discriminatory manner. A statement was called for from the K. D. A. in respect of the extensions granted by it in the period of construction for the plots in the Scheme in which the plot of the petitioners is located. We find that a large number of extensions were granted by the K. D. A. In some cases there were as many as four or five extensions. In one particular case, the period for raising construction has been extended to beyond eleven years. Mr. Shamsul Haq Memon was unable to explain to us the considerations or the reasons on the basis of which these extensions were granted. He, however, placed before us the files of the K. D. A. relating to this particular plot. On examination of the relevant files, we find that the Director, Lands and Estates, on receipt of the representation of Usman Haji Ghani to the show‑cause notice, had made the following endorsement:

"We are normally allowing one extension at least. D. G., however, may kindly see for orders."

The Director‑General, instead of passing any orders, referred the case to the Chairman, who simply directed that the plot may be cancelled, without indicating whether he had considered the representation of the allottee or found it to be without substance. So far as the review petition is concerned, we find from examination of the files that it was never put up to the Chairman, and instead the Director‑General ordered that the matter could not be re‑opened as the order of cancellation had been passed by the Chairman. So far as the second review petition made by the allottee is concerned, the record in respect of it has not been made available and Mr. Shamsul Haq Memon frankly conceded that he does not know what has become of it. Another circumstance, which has greatly intrigues us, is that the father of the respondent No. 2 had personally presented the application for allotment of the plot in dispute to the Chairman/Commissioner, and the latter ordered that it may be given to him, if it was lying vacant. This appears to us to be rather an extraordinary manner of doing things. If other allottees could be granted a number of extensions, we fail to see why the petitioners or their predecessor? in‑title were discriminated against and were not granted even a single extension though they pleaded certain circumstances, which could well have been taken into consideration, and furthermore, when it was apparently the policy of K. D. A. to liberally grant a first extension. We consider that the manner in which the allotment of the plot was cancelled and the various representations of Usman Haji Ghani were rejected indicate that the K. D. A. and its Chairman were not exercising their discretion in a proper or balanced manner but arbitrarily and in a partial and unjust manner.

7. Mr. Valliani sought to rebut the contention of Mr. Shamsul Haq Memon That the K. D. A. was not entitled to cancel the plot allotted to Usman Haji Ghani even after the expiry of the period within which it was to be constructed on the ground that in contracts to sell lands, there is a presumption that time is not of the essence of the contract. In support of his contention he pressed in service the decision of the Lahore High Court in Muhammad Shafi's case. The facts of that case, however, are clearly different from the facts of the present case. In that case, after the allotment of a plot which had been granted by the Lahore Improvement Trust was cancelled, it was restored to the allottee and the period for raising construction on the plot was extended by the Trust on the condition that the allottee will pay a specified composition fee. It was this part of the order, requiring the allottee to pay a composition fee, to which exception was taken by the High Court on the ground that no such composition fee or penalty could be imposed on the allottee under the terms of the agreement or the allotment order and that further the Trust having accepted the directions of the Government in regard to the extension of the time for completing the construction, was duty bound, according to the principles applicable to sale of land, to provide further reasonable opportunity to commence and complete construction on the plot.

8. We next turn our attention to the contentions raised by Mr. Nasir Khan, the learned counsel for respondent No. 2. His contention that no review petition could be entertained by the Chairman, since there is no provision in the rules of the lt. D. A. for such review, appears to us to be without substance, as has been pointed out by their Lordships of the Supreme Court in the case of Pakistan v. Muhammad Himayatullah (P L D 1969 S C 407). It is settled rule that apart from the provisions of section 21 of the General Clauses Act, locus poenitentiae, i.e., the power of receding till a decisive step B is taken is available to the Government or the relevant authorities and in fact the existence of such a power is necessary in the cave of all authorities empowered to pass order to retrace the wrong stems taken by there,

9. We equally repel his contention that Usman Haii Ghani had been given adequate tune to commence and raise construction on his plot, but he failed to do so. We have already referred to the fact that other allottees were given extensions of up to nine to ten years, but not even a single extension was granted to Usman Haji Ghani though he had pointed out in his representation the difficulties in the raising of construc?tion and also the further fact that the objections to his plans were not communicated to him, but only to his Architect. There is nothing to indicate that the Architect communicated the objections to him.

10. We are also riot impressed with the contention of Mr. Nasir Khan that this was a case of breach of simple agreement and hence not susceptible to exercise of writ jurisdiction. The K. D. A. is a statutory authority and on‑a of its functions is to prepare housing schemes, develop plots and give them to housing societies, individuals and construction companies. It was in compliance with its statutory duties that it had issued the scheme for allotment of plots and it was under that scheme that Usman Haji Ghani had applied for and obtained a plot. This was thus not a case of simple agreement, but a performance of statutory obligation and function.

11. Mr. Nasir Khan also faintly attempted to argue that under the terms of the allotment and the allotment regulations of the K. D. A., the allottee is a mere licensee until the allottee builds a house and executes a regular lease with the K. D. A. This contention has no substance in view of the decision of their Lordships of the Supreme Court in tile case of Kamaluddin Ansari v. Director, Excise and Taxation (P L D 1971 S C 114), that the allottees of plots in the P. E. C. H. Society were either licensees nor sub‑licensees, though they bad been so labelled in the agreements executed between the Government, the housing societies and the individual owners, for they had real interest in the land allotted to them. The criterion that has been laid down by their Lordships of the Supreme Court in the case of Abdul Bhai v. Muhammad Ahmad Din (P L D 1964 S C 107) for distinguishing between a lease and a licence is whether any right in immovable property itself, i.e. a right in rem, has passed to the person concerned. In this case clearly a right in rem in respect of the plot has passed to the allottee.

12. In the result, we are of the opinion that not only the petitioners and their predecssor‑in‑tale were treated in a discriminatory and prejudicial manner and were not given an adequate or a reasonable opportunity of commencing aid raising a construction on the plot allotted to them. but further that the K. D. A. and its Chairman acted in undue haste, in an arbitrary manner and contrary to the policy normally followed by the K. D. A. itself, in cancelling their plot and allotting it to respondent No. 2, and rejecting, without due consideration, the representations and review petitions made by Usman Haii Ghani. We, therefore, allow the petition with costs and declare the impugned order cancelling the allotment of Usman Haji Ghani and the subsequent order allotting the plot to respondent No. 2 as being without lawful authority and of no legal effect.

K. B. A. ???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????? Petition accepted.