FAZAL MUHAMMAD and others vs FAZAL ELAHI and others
This matter arises from a petition for leave to appeal against the judgment of the Lahore High Court dismissing a writ petition in a settlement case concerning land confirmation and subsequent auction. The core legal question is whether petitioners who purchased land from an auction-purchaser whose own auction was never confirmed and was subject to pending litigation can claim protection as bona fide purchasers for value without notice. The Supreme Court held that the auction-purchaser had no valid right or title to transfer the property because the auction was not confirmed and the property was subject to a High Court challenge decided in favour of the respondent. Consequently, the sale-deed in favour of the petitioners had no legal effect. The key principle laid down is that a purchaser from an auction-purchaser whose auction has not attained finality or has been nullified by judicial proceedings acquires no legal title, and the doctrine of bona fide purchase cannot protect a title derived from a non-owner or a person with a defeasible and extinguished interest.
- Whether a purchaser from an auction-purchaser whose auction was never confirmed can claim protection as a bona fide purchaser?
- Does an auction-purchaser acquire transferable title to property when the auction confirmation is stopped and subsequently set aside by the court?
- Can leave to appeal be granted against a detailed High Court judgment properly resolving settlement land claims?
ORDER
1. ' S. USMAN ALI SHAH, J.-Leave to appeal has been sought by the petitioners against the judgment dated 28-3-1989 of the Lahore High Court; whereby writ petition of Fazal Muhammad etc. Was dismissed in a Settlement case arising in the following circumstances.
2. ' On 28-12-1967 Fazal Elahi was proposed the disputed area measuring 336 kanals 15 marlas in Khata No,109 at village Sohidra, Tehsil Wazirabad District Gujranwala. Before its confirmation in the name of the respondent No,1, the Chief Settlement Commissioner on 25-6-1973 stopped confirmation of such earlier proposals. The land in dispute was subsequently auctioned in favour of Shah Nawaz, respondent No,2. Respondent No,1 challenged the order of the Chief Settlement Commissioner through a writ petition, in the Lahore High Court, which was allowed vide order dated 22-11-1974 and the land in dispute was finally confirmed in the name of the respondent No,1, on 28- 12-1976. The petitioners also filed another writ petition, praying that the auction made in favour of Shah Nawaz respondent No,2 was lawful and in purchase of the same, the purchase of the disputed land by the present petitioners being bona fide and be declared as legal. The respondent No,1 contested the writ petition and filed written statement in which he raised priliminary objeeti6n that the writ is incompetent as the order of confirmation of the disputed land in his name was passed on 28-12-1976 which was not challenged by the respondent No,2. The learned Single Judge of the High Court while dismissing the writ petition held as under:- "It is directed that if the petitioners have installed a tubewell or constructed houses on the land in dispute and those happened to be adjacent or nearby, then the areas thereunder shall stand surrendered in favour of the petitioners. If the tubewell and the houses are separated by some distance, then the petitioners would have the areas under the houses as surrendered by the learned counsel for the respondent No,1. As regards the tubewell, the petitioners would either remove the same or leave it at the spot on mutually agreed compensatory amount. The petitioners can claim the refund or such other relief as determined by the parties under the registered sale- deed from their vendor. The petition is thus disposed of. The parties shall bear their own costs."
3. 'The contention on behalf of the learned counsel for the petitioners is that the petitioners are the bona fide purchasers from an ostensible owner and they can protect their right as the purchase by them was by valuable consideration and without any notice from the opposite-party. The record shows that the auction in favour of respondent No,2 on 26-1-1974 was not confirmed in view of the interim order dated 8-2-1974 in writ petition filed by the respondent No,1 which was ultimately allowed by the learned High Court in his favour on 22-11-1974. Consequently, respondent No,2, the alleged auction-purchaser, having *no right could not transfer the property in dispute on 20-11- 1975 to the petitioners through the alleged sale-deed which has no legal effect. Since the judgment of the learned High Court is in detail and in which all the points have been dealt with thoroughly, therefore, we do not consider that this is a fit case to grant leave to appeal. The petition is hereby dismissed.