SHAMSUDDIN AND ANOTHER vs Haji KHUDA BAKHSH AND 3 OTHERS
This matter arises from a review petition seeking the review of an order dismissing a civil petition for special leave to appeal, which had challenged a Lahore High Court order holding that the respondent, a Muslim mortgagee in possession, was entitled to the transfer of the disputed shop. The core legal question was whether the acquisition of the property under the Displaced Persons (Compensation and Rehabilitation) Act, 1958, wiped out the respondent's mortgage and possession, thereby giving the petitioners, who were inducted as tenants, an independent right to transfer. The Supreme Court held that the review petition had no merit, finding that the acquisition of the property free from encumbrances did not affect the respondent's actual physical possession on the prescribed date, and that the petitioners, deriving their possession through the respondent, had no independent locus standi. The key principle laid down is that a tenant inducted by a mortgagee in possession cannot claim an independent right to the transfer of evacuee property in preference to the mortgagee, notwithstanding the subsequent acquisition of the property for the compensation pool.
- Whether the acquisition of evacuee property under section 3 of the Displaced Persons (Compensation and Rehabilitation) Act, 1958 wipes out a mortgagee's possession for the purpose of property transfer?
- Can a tenant inducted by a mortgagee claim an independent right to the transfer of evacuee property in preference to the mortgagee?
- Does the acquisition of property for the compensation pool affect the actual possession held on the prescribed date under the Displaced Persons (Compensation and Rehabilitation) Act, 1958?
- Section 3, Displaced Persons (Compensation and Rehabilitation) Act 1958
- Section 2(6), Displaced Persons (Compensation and Rehabilitation) Act 1958
ORDER
1. ' ANWARUL HAQ, J.-This petition seeks a review of the order made by us on the 1 1 the of March 1974, dismissing Civil Petition for Special Leave to Appeal No, 412 of 1973, presented by the petitioners to challenge an order made by a learned Single Judge of the Lahore High Court on 28-9-1973 in respect of shop No, 48 situate in Nadir Shah Bazar, Bahawalnagar. By the said order the learned Judge in the High Court allowed the Constitution petition filed by the respondent Haji Khuda Bakhsh, holding that he was in possession of the said shop and, therefore, entitled to its transfer.
2. The learned Judge further held that the petitioners, as tenants of Haji Khuda Bakhsh, could not be deemed to be in possession in their own right.
3. ' In the order under review we have upheld this view of the High Court, on the ground that the respondent Haji Khuda Bakhsh was a Muslim mortgagee in possession of the property in dispute, and his mortgage had been recognised by the Custodian of Evacuee Property after the migration of the non-Muslim owner. We have further endorsed the view of the High Court that petitioners having entered on the property as tenants of the respondent, they could not get property transferred in preference to him.
4. ' It is submitted by Mr. Abid Hassan Minto that while refusing to grant leave to appeal we have overlooked the legal effect of the acquisition of the property in dispute under section 3 of the Displaced Persons (Compensation and Rehabilitation) Act, 1958, for the purpose of constituting the compensation pool, as such acquisition had the effect of wiping out the respondent's mortgage altogether, with the result that he could no longer be deemed to be in possession. The learned counsel submits that as a logical corollary, the only persons in possession would be the petitioners, although they may be regarded as being authorized occupants within the meaning of the Central Government notification of the 13th of October 1959.
5. We see no merit in these submissions. For the purpose of ascertaining entitlement to the transfer of the property, it is necessary to determine as to which party is in possession. The respondent having entered into the possession of the property as a mortgagee from the non-Muslim owner and his mortgage having been subsequently recognized by the Custodian of Evacuee Property, he was in possession within the meaning of that term as defined in clause (6) of section 2 of the Act. It was he who inducted the petitioners on to the property as his tenants. The acquisition of the property by the Central Government free from all encumbrances by a notification issued on the 21st of August, 1959, did not in any manner affect the respondent's possession on the prescribed date, namely, the 20th of December 1958. On that date the petitioners had no independent locus standi of their own, as they derived their possession from the respondent.
6. ' For the foregoing reasons the review petition fails and is hereby dismissed.