ASGHARI BEGUM Versus ADDL. SETTLEMENT COMMISSIONER (INDUSTRIES), LAHORE

1. MUHAMMAD Gul, J. -This appeal by special leave is from the judgment of a Division Bench of the High Court at Karachi in L. P. A. No. 290 of 1966 reversing that of a learned Single Judge dated 22-8-1966 by which Writ Petition No. 427 of 1966 moved by Habibur Rahman respondent 3 herein was dismissed In limine.

2. The dispute relates to the transfer of Roxy Cinema, Lidbitteir Road, Karachi. The cinema was originally allotted by the West Pakistan Rehabilitation Board to six persons including Mst. Asghari Begum, the appellant and Habibur Rahman, respondent 3. With the commencement of the Displaced Persons (Compensation and Rehabilitation) Act, 1958 (Act XXVIII of 1958), the appellant was found entitled to the transfer of the cinema under paragraph 15 (2) in Schedule to the Act, in that she had abandoned a cinema called Jehannuma in Agra and had verified claim for Rs. 1,87,000 an respect of the same entered in Schedule III to the Registration of Claims ;Displaced Persons) Rules, 1955. Accordingly, the Chief Settlement Commissioner by order dated 7-12-1959 transferred the cinema in dispute in her favour "on the prevailing market price to be determined in due course Of the remaining five allottees, only Habibur Rahman agitated in the matter. He rested his claim on the allegation that he had been appointed managing allottee and in the course of his management had invested Rs. 1,36,000 :n the cinema and therefore was entitled to its transfer under paragraph 15-A .of the Schedule to the 1958 Act read with Central Government's letter Sated 19-10-1959. His appeal against the transfer of cinema was however, rejected by the Chief Settlement Commissioner on 13-2-1960. On a further representation made by him he was informed by the Chief Settlement Commissioner by letter dated 19-3-1960, that he has been "found entitled to being associated with the transferee" of the disputed cinema on the payment of market value of his share in the cinema to be communicated to him later. This was in consequence of an ex parte order without any notice to the appellant.

3. Aggrieved by the above order of the Chief Settlement Commissioner, Mst. Asghari Begum applied for its review on the plea that the investment made by Habibur Rahman was less than Rs. 25,000 and therefore he was ineligible for being associated with her. The matter was entrusted to the Additional Settlement Commissioner (Judicial), Karachi to make enquiry to verify the total investment made by Habibur Rahman. During pendency of the enquiry communication dated 5-11-1960 was received from Additional Settlement Commissioner (Industries), Lahore that the market value of the cinema had been assessed at Rs. 1 2,74,000. It required both the appellant and Habibur Rahman to signify their acceptance of the transfer at that price, within ten days. Following the intimation about the price Habibur Rahman on 25-11-1960, filed an affidavit before the Additional Settlement Commissioner, stating that the price of Its. 12,74,J00 was unacceptable to him and therefore enquiry about his "entitlement to association (had) become infructuous" and that he would submit the details of his investment before Additional Settlement Commissioner (Industries) Lahore "for recovery of the same". On following day the Additional Settlement Commissioner (Judicial) reported to the Chief Settlement Commissioner that from the documents produced before him, the investment made by Habibur Rahman appeared "definitely less than Rs. 25,000 anal further that the market value assessed at Rs. 121,71,000 not being acceptable to him "he does not now want to associate".

4. Consequent upon the above report, the order dated 16-3-1960 declaring the respondent entitled to association with Mst Asghari Begum was cancelled both Because of his voluntary withdrawal from association and further that the investment made by him was less than the prescribed minimum of Rs. 25,000. The order of cancellation was issued by the Secretary, West Pakistan Industries Rehabilitation Board, Lahore on 7-2-1961.

5. Mst. Asghari Begum on the other hand intimated her acceptance of the transfer of the cinema, though at the same time she protested that the price was "very high" and reserved her right to agitate for a reduction of the price. She was however required to pay 1/4 of the price as assessed already, pending a decision on her representation, which apparently she did. Ultimately the price of cinema, excluding the price of land, was reduced to Rs.2,15,078. The price of land was also later worked out and the aggregate price was assessed at Rs. 3,67,911.50 which she paid within the due date and transfer deed was issued in her favour on 18-8-1966 as the sole transferee of the cinema. With that ended the first phase of the contest.

6. In the meantime Habibur Rahman on coming to know about the reduction in the market value of the cinema, moved an application on the 3rd December 1965 for "revival of his claim" for association with Mst. Asgbari Begum for the transfer of the cinema. The application was dismissed by the Chief Settlement Commissioner by order dated the 21st March 1966 on the ground that the earlier order dated 17.2-1961 cancelling his association with rust. Asghari Begum had attained finally and that it was beyond his competency to review that order, the power to review his predecessor's order being no more available to him.

7. Aggrieved by the order of the Chief Settlement Commissioner Habibur Rahman moved writ petition in the High Court for appropriate direction. to the Chief Settlement Commissioner for the revival of his association with Mst. Asghari Begum. It was alleged that what really influenced him earlier to withdraw from the association was that the market value of cinema was fixed at the much exaggerated figure of Rs. 12,74,000 and now that the market value had been reduced to Rs. 2,15,078 he could in law seek a revival of his claim for association. The writ petition was dismissed, in limine by a learned Judge on the ground that the Chief Settlement Commissioner rightly held that he had no power to review his predecessor's. order and further respondent was seeking a revival of right to associate, three: years after permanent transfer of the cinema. The decision of the learned Single Judge was however, reversed by a Division Bench on appeal by Habibur Rahman. The learned Judges of the Division Bench took the view that Habibur Rahman'a withdrawal from the association was "conditioned" on the market value of the cinema being assessed at Rs. 12,74,000 but: later the value being reduced to Rs. 2,15,078 which was acceptable to him there was a "revival" of his right for association with Mst. Asghari Begum. The learned Judges further held that Ha~ibur Rahman's application for the revival of his claim for association was summarily rejected without affording him any hearing and therefore was in breach of the principle of audi alteram partem.

8. Leave was granted to consider the correctness of the view taken by the learned Judges of the Division Bench on the facts stated above.

9. The fact that Habibur Rahman's association with Mst. Asghari Begum for the transfer of the Cinema was cancelled at his own request made in his affidavit before the Additional Settlement Commissioner on 25-11-t96tt because he was not prepared to accept the association and the transfer of' the cinema on the basis of its market value assessed at Rs.-12,74,t,03 is not controverted. However, it appears that Habibur Rahman's case before the Division Bench was that the market value of the cinema was inflated as a result of "collusion" between Mst. Asghari Begum and the Settlement Department in order to elbow him out of the contest and that in fact his withdrawal from the association was entirely due to the price as originally fixed which was not only "unrealistic" but "artificial and excessive". The learned Judges did not record a definitive finding on the question of any collusion between Mst. Asgbari Begum and the Settlement Department. And that is not surprising because no particulars of any collusion or fraud much less any proof of that plea was given. Nevertheless, the learned Judges found a "positive allure" in the above plea and went on to observe that the respondent's withdrawal from the association was "wholly conditioned" by the inflated and unrealistic price which cannot "in reason and fairness" be allowed to come in his way to re,-oil from his earlier stand in the altered situation brought about by a reduction in the market value. In the opinion of the learned Judges the respondent had the option to accept a market value which was "lawfully fixed and that his association was dependent upon that condition precedent. The implication was that Rs. 12,74,000 was not lawfully fixed as the prevailing market value. But if we may say so with due respect, it is difficult to sea how that sweeping conclusion was reached.

10. Mr. Abdus Salam Faruqui, learned counsel for the appellant in the course of his argument pointed out that the reduction of price from Rs. 12,74,000 to Rs. 2,15,078 was entirely due to change in policy. Initially the market value was reckoned on the basis of 12 years entertainment duty. But as a sequel to repeated protests by the transferees, the ? Government introduced a new formula, under which the price was reduced in the instant case also Mr. Sharifuddin Piraada appearing for Habibur Rahman did not controvert that statement. That being so, learned counsel for the appellant rightly stressed that the learned Judges were unduly allured by Habibur Rahman's case : indeed there was nothing sinister in the reduction of the price. In any event there was no proper plea of any fraud or collusion and the matter rested in vague allegation only and yet the learned Judges, it appears unwittingly, allowed their mind to be influenced by that plea. As pointed out already, the initial association of Habibur Rahman with the appellant was a result of an ? ex parts order after the initial transfer of cinema solely in favour of the appellant. But the latter questioned the respondent's eligibility for association and there was a positive finding that he has not been able to show that he had invested not less than Rs. 25,000 with the approval of the Custodian or any other appropriate authority, which was a condition precedent for his eligibility for association. ??????

11. That apart, even assuring for the sake of argument, that respondent 3 was not scared away by the enormity of the market value as originally assessed. it is difficult to discover w:5 principle of law-and learned counsel for the respondent ? was not able to cite any-under which there could be a "revival" of the respondent alleged right of association upon subsequent reduction of price acceptable to hire, It was all a question of one judgment depending upon his business acumen or sagacity whether to accept transfer, and then to agitate for a reduction of price was done by the appellant or to unconditionally withdraw from the scene, as was done by the respondent. Rather a perusal of the report by the Additional Settlement Commissioner (Judicial) dated 26-11-1960 leaves as manner of doubt that respondent withdrew because he was unable to adduce evidence in support of his claim for investment despite repeated adjournments. Therefore, hi. decision to withdraw his claim for association on the excuse of the enormity of the price, was a mere face-saving and not a true reason.

12. Moreover, it seems fanciful to suggest that by withdrawing from the association in the circumstances of the case, the respondent surrendered any "legal right" which, on the subsequent turn of events for the better, revived and became enforceable in law. As pointed out already the foundation of the respondent's claim for association with the appellant is the Central Government's letter dated 19-10-1959 issued under paragraph 15-A of the Schedule to the 1958 Act. Paragraph 4 of this letter is material and reads:

13. "If an industrial concern or a cinema house allotted by the aforesaid Industrial Rehabilitation Board is transferred to any person under subparagraph 2 of paragraph 15 of the Schedule to the Displaced Persons (Compensation and Rehabilitation) Act, 1958 and prevailing market value of such industrial concern or cinema house is not fully covered by the amount of deferred payment admissible to the transferee, then he shall, while associating other claimants with him, give preference to a claimant in possession of such industrial concern or cinema house who has installed therein machinery and equipment of the value of rupees twenty-five thousand or more; and the share of the claimant so associated shall be determined in accordance with such instructions as may be issued by the Chief Settlement Commissioner." (Underlining* supplied).

14. The underlined* words are highly significant. Upon a plain reading of the above, particularly the underlined* wording it would be a misnomer to say that any legal right enforceable by a writ in the nature of mandamus was created in avour of respondent or it imposed a corresponding duty upon the Settlement Authorities. "The provision upon its plain language s directory. It is addressed to the transferee under paragraph 15 (2) of the Schedule to the 1958 Act, whose compensation book does not fully cover the market value of the industrial concern or cinema louse, "to give reference" to a claimant who is in possession and has made the requisite investment. This provision stands in sharp contrast with paragraph 1 in the Schedule, where in relation to right of a claimant for the transfer of a house in his possession or in the possession of his named relation, the language used is mandatory and uncompromising. It says, in the relevant situation, the house "shall be transferred to him at a price determined on evaluation basis". The language used clearly creates a right in the claimant on the one hand and imposes a corresponding obligation on the Settlement rganizatiors on the other. In the instant case at best, the above paragraph creases as mere de facto interest as distinguished from de jure interest in favour of the respondent, which merely qualifies or makes hi eligible for association with the transferee in preference to others hen upon its language, the direction is addressed to the transferee. It does not impose any corresponding duty. It is possible to conceive of a case where the transferee, whose deferred claim is a insufficient to cover ? the entire price, is prepared to pay the balance in cash and thus close the door' against any association. This clearly militates against the creation of any legal right in the absolute sense, apart from creating de facto interest- for a preferential treatment in the given situation. On that view of the matter, it is otiose to claim any legal right inhering in the respondent and Much less any revival of the same, by a side hind, as it were, following a reduction in the prevailing market consequent upon the application of a new formula. ??????? `[Here in italics]

15. The second ground which weighed with the learned Judges of the Division Bench to reverse the decision of the learned Single Judge was that the order dated 3-12-1965 rejecting the respondent's claim for the revival of association was made ex parse without affording him any hearing. This according to Syed Sharifuddin Pirzada offended against the principles of natural justice. He cited a number of precedent eases in support of the view taken by the Division Bench. The argument presupposes first that the respondent had legally enforceable right and secondly that the Chief Settlement Commissioner had the jurisdiction to entertain his application for "revival". Both these conditions are missing in the instant case. The respondent in effect sought a review by the Chief Settlement Commissioner of earlier order by his predecessor. It is not controverted that at the material time no such jurisdiction in the Chief Settlement Commissioner except to correct some clerical or arithmetical error existed.

16. For the foregoing reasons the appeal is accepted and the judgment of the Division Bench is set aside and that of the learned Single Judge restored. There will be no order as to costs.

17. S. A H. ??????????? Appeal accepted.