RASAAL HASAN SYED, J.---- This judgment will dispose of the instant appeal against order of rejection of objection petition C.M. No.350-B/2005 as well as the appeals listed hereinbelow as the same stem from a common Order dated 24.1 1.2019 of learned Single Judge-in-Chambers of this Court passed in Banking Jurisdiction:
(i) E.F.A. No.150 of 2016 titled "Arshad Kan v. National Bank of Pakistan and others" against rejection of objection petition C.M. No .341-B/2005.
(ii) E.F.A. No.151 of 2016 titled "Mst. Nazirna Farooq v. National Bank of Pakistan and others " against rejection of objection petition C.M. No.334-B/2005.
(iii) E.F.A. No.152 of 2016 titled "Mst. Nusrat Ara and others v. National Bank of Pakistan and others " against rejection of objection petition C.M. No.336-B/2005.
(iv) E.F.A. No.153 of 2016 titled "Nusrat Ara and others v. National Bank of Pakistan and others " against rejection of objection petition C.M. No.338-B/2005.
(v) E.F.A. No.154 of 2016 titled "Muhammad Akram v. National Bank of Pakistan and others " against rejection of objection petition C.M. No.370-B/2005.
(vi) E.F.A. No.265 of 2016 titled "Hambal Mahmood v. National Bank of Pakistan and others " against rejection of objection petition C.M. No.344-B/2005.
(vii) E.F.A. No.353 of 2016 titled "Sheikh ljaz v. National Bank of PUkistan and others." against rejection of objection petition C.M." No. 347-B/2005.
2. Facts in brief are that the decree dated 24.7.2002 was passed in favour of respondent bank in Banking Jurisdiction of this Court for a sum of Rs.270,992,492,- with costs of Rs.15,149/- amounting to total of Rs.271,007,641/-; on failure of the judgment-debtors to pay the decretal amount, satisfaction of the decree was sought by auction of the properties mortgaged with the respondent bank. The appellants at this stage filed objections on the plea that they were bona fide purchasers who had constructed their houses on the land in question and had been living there for decades; they sought the auction to be stayed and property be released/de- attached and excluded from the list of proprieties earmarked for sale in execution of the decree supra. Through order dated 24.1 1.2015 the objection petitions of the appellants were dismissed.
3. Learned counsel for the appellants have pursued a common thread of arguments by submitting that the appellants purchased their respective properties decades ago, on which they built their houses and were living since; and that at the time of purchase they had consulted the revenue record wherein the fact of mortgage in favour of the respondent bank was not incorporated and, as such, having acquired the property in good faith after exercising reasonable care and due diligence, they were clothed with the status of bona fide purchasers without notice and were protected under section 41 of the Transfer of Property Act, 1882 and as such their objection to the implementation of the decree by liquidation of their property was liable to succeed.
4. Contrariwise, learned counsel for the respondent bank submits that the plea of bona fide purchasers will not be available to the appellants as the same is inoperative in instances where the property has been mortgaged by deposit of title deed and the purchasers have not ensured the availability of original title deeds before entering into the transaction. Reliance in this regard was placed on "Mst. Nasiban Bibi v. The Australasia Bank, Lahore and 2 others " (1970 SCMR 657), "Major Muhammad Tariq v. City Bank Housing Finance Company Ltd. Through Manager " (2002 CLD 1090 ), "Muhammad Farrukh and 2 others v. Allied Bank of Pakistan through Manager and 12 others" (2003 CLD 37), "Citibank N.A. through Manager v. Muhammad Akbar and 3 others " (2005 CLD 384), "Muhammad Jameel and another v. Citib ank N.A. and 3 others " (2005 CLD 610) and "Ahmed Zaki Khokhar and 3 others v . Bank of Oman Ltd. and 5 others " (2005 CLD 1047 ).
5. We have given deep thought to the arguments from both sides and have gone through the documents available on the record. It appears that to secure finance extended to Messrs Haq Diaries Ltd., certain immovable properties purportedly owned by the directors/shareholders of the company , were mortga ged in favour of the National 'Development Finance Corporation (N.D.F .C.), the predecessor-in-interest of the respondent bank, by execution of Memorandum of Deposit of Title Deed (M.O.D.T) dated 17.12.1984 and delivery of corresponding title deeds relating to properties. It appears that the smaller chunks out of these immovable properties were purchased by the objectors in the period between 1994 and 1997, which was admittedly about a decade after the mortgage had been created. In almost all of the cases the purchase is claimed to have been effected prior to institution of the suit by the bank on 30.9.1997 and the passing of the judgment dated 24.7.2002. The main defence raised in support of the plea of bona fide purchasers is based on the since that the property was not urban, entries in the revenue record were duly consulted, the bank had not incorporated the mortgage charge in the revenue record or for that matter registered it with the concerned sub-registrar and that under the circumstances, the purchase of the immovable property had been made after exercising sufficient prudence and reasonable care to exclude the possibility of Any pre-existing encumbrance and, as such, in the peculiar circumstances of the case they were protected, against liquidation of their properties in implementation of decree that shall result in dislocation of their families and dismantlement of their homes and which they had purchased in utmost good faith and after paying valuable consideration.
6. The registration of charge with the Registrar Company under section 121 of the Companies Ordinance, 1984 appears to have been the fulcrum of reasons that prevailed upon the learned Single Judge in non-suiting the objectors. This particular basis, however , to exclude the appellants from the category of bona fide purchasers appears to be not available as the immovable property under reference, as already noted, was not owned by the company but by directors/shareholders and, therefore, there being no obligation to register the same with Registrar of Companies under section 121 of the Companies Ordinance, 1984, the same could hardly be expected to be a relevant gauge to assess the due diligence of the objectors.
7. It is also manifest that out of a larger chunk of land the portion of land had been purchased by the objectors upon which they claimed to have built their houses and it is claimed that this was done after exercise of reasonable care to ascertain that the transferor had the power to make the transfer and in good faith. It was also the objectors' stance that the land was not urban but agricultural and therefore, the chain of title could be more appropriately verified as a bona fide purchaser from the revenue record which did not indicate existence of any charge of bank; instead the same reflected the sellers to be the exclusive owner of the land. Another ground urged by the objectors was that the alleged deposit of title deed to create equitable mortgage was neither claimed through a registered document nor any mutation as required in law to notify the charge was ever incorpo rated in the revenue record and that they raised the construction without any objection from the bank or any third person and which obviously bars the bank from claiming any charge prior to the sale. With a view to determine this controversy and to return findings effectively on the question of existence or otherwise of bona fide purchase, it appears appropriate that the objectors should have been allowed an opportunity of evidence, so that the factual stance of the appellants was properly fleshed out on record to ensure that the plea with regard to prudent behavior could be more deeply and carefully analyzed and considered. The onus to establish the plea of bona fide purchasers, of course, fell clearly and squarely on the appellants; it would therefore, be in keeping with the rule of justice that the appellants be allowed an opportunity to substantiate their claim by leading evidence; such step would have ensured a more balanced approach in the context at hand. The learned Single Judge, while dealing with the plea of construction at site, observed that "so far as plea of the objectors that they have raised construction on the property , the same will not defeat the mortgage charge of the decree-holder bank...In any case compen sation for such improvement, if any, is protected under section 51 of Transfer of Property Act, 1882". In view of this observation, it was all the more essential to record evidence in so far as to consider the relief, as could be given under section 51 of Transfer of Property Act, 1882, the recording of the evidence was integral. This provision of law contemplates that if the transferee of immovable property makes any improvement on the property , believing in good faith that he is automatically entitled thereto and he is subsequently evicted therefrom by any person having a better title, the transferee has a right to require the person causing the eviction either to have the value of the improvement estimated and paid or secured to the transferee, or to sell his interest in the prope rty to the transferee at the then market-value thereof, irrespective of the value of such improvement. It is consistent rule that the application of provisions of section 51 of Transfer of Property Act, 1882 was not a simple question of law rather factual foundation within the parameters of the section required to be investigated and determined so as to render a decision whether the transferee could allowed compensation for improvement or admitted to proprietary interest in the land on payment of its value. This, of course, could be possible only if the objectors had been permitted to lead evidence; as they were not party in the proceeding of the suit and did not have the opportunity to support the plea by the evidence therefrom. In view of the observations of the learned Single Judge as noted above and the circumstances considered hereinbefore, it will be appropriate that the matter be thrashed out by allowing evidence to come on record.
8. In the circumstances above, these appeals are allowed ; the objection petitions of the appellants in result shall be deemed to be pending which will be decided afresh after framing a specific issue on the plea of bona fide purchasers without notice and also in terms of the ingredients of section 51 of Transfer of Property Act, 1882 by duly providing opportunity of evidence to the parties whereafter the C.Ms. shall be disposed of on their own merit and in accordance with law .