ZAFFAR HUSSAIN MIRZA, J.-This is an appeal by special leave against the order dated 25-2-1975 passed by a learned Single Judge of the Lahore High Court at Lahore, whereby appellant's second appeal was dismissed in limine. Leave has been granted in this case to consider the question whether the vendee/tenant of land can defeat the right of a pre-emptor on a plea of improvement of status the sale, by reason of the superior of pre-emption conferred under Article 25 of the Land Reforms Regulation, 1972.
2. The appellants purchased the suit land from its owner Dost Muhammad by means of a registered sale dated 12-7-1971. Subsequently the respondent brought a suit for pre-emption of the land claiming a superior right on the basis of his being a collateral of the vendor. The appellants resisted the suit, inter alia, on the plea that at the time of sale, they being the tenants of the suit land, had improved their status by virtue of the superior right of pre-emption created under Article 25 of the Land Reforms Regulation. The suit was decreed by the learned Civil Judge, Pindigheb, as per his judgment dated 12-6-1974, which was further affirmed in appeal by the learned District Judge, Campbellpur, by his order dated 9-12-1974. The second appeal preferred by the appellants before the Lahore High Court was dismissed by the impugned order in this appeal.
3. The contention, of the appellants that there was an improvement in their status by virtue of the "first right of pre-emption" created under Article 25(3) of the Land Reforms Regulation, was rejected by the learned Single Judge on the grounds which may be stated in his own words- "After hearing the learned counsel for the appellants, I am of the view that this is not a case of improvement by the vendee since the date of enforcement of the relevance provisions of Martial Law Regulation No, 115, the appellants had ceased to be tenants, their right of tenancy and the right of ownership having merged on the 12th July, 1971, i,e, several months before the enforcement of the above Regulation."
4. Now the admitted position in this case is that the vendor, under whom the appellants claim to have been tenants, had executed a registered sale-deed in their favour on 12-7-1971 and Article 25(3) of the Land Reforms came into force from Kharif 1972. It was not disputed before us, on B behalf of the appellants, that the right of pre-emption created under the said provisions had not vested in the appellants at the time of the sale in question. The only contention was that whereas the pre-emptor's rights in a suit of pre-emption are determinable with reference to the date of sale, the defendant/vendee is permitted under the iaw to improve his status after the sale but before the institution of the suit. There can be no cavil in regard to the proposition of law submitted by the learned counsel. The position with regard to a pre-emptor is no doubt that he must show that the superior right to pre-empt which he had at the date of the sale continues to remain superior at all relevant times and consequently if he does not have any such right at the date of the sale, he cannot be permitted to improve his position before the date of institution of the suit. The position of the vendee/defendant is, however, different, in that the law permits in his case any improvement in his status qua the rights of pre-emption, provided such improvement takes place before the institution of the suit. But, in the present case, the question is whether any improvement in the rights of the appellants had taken place before the institution of the suit on 2-7-1972. They rely on the right of pre-emption created in favour of the sitting tenants on the land comprised in their tenancies, and this right became vested expressly with effect from Kharif 1972 and not retrospectively from any prior date. Plainly, therefore, the right of pre-emption created by this provision of law was available only to persons who were tenants on the date of the enforcement of this law or in the future. The learned Single Judge has held that since-on the vesting of the ownership rights in them, their status as tenants came to an end, they ceased to be tenants with effect from the date of sale, viz. 12-7-1971, and, therefore, on the date of the coming into force of the provisions of Article 25(3) of the Land Reforms Regulation, they were no longer tenants so as to be vested with the right of pre-emption created thereunder. The question of improvement is the status of the appellants, therefore, does not arise since no superior rights were created in their favour under the provisions invoked by them. Once they became owners they could not claim any right as tenants, as their rights as tenants would be extinguished by merging of the interests of tenants into ownership rights. This principle of merger is recognized by section 111, clause (d) of the Transfer of Property Act, but even under the general principles ordinarily interests of the tenant and landlord would merge in case of the title acquired by the tenant and the question of merger would depend upon the intention of the parties. Accordingly, there would be merger if the conduct of the parties shows that there was no intention to keep the interests apart. In the present case, there is no question of the appellants' keeping the interests of tenancy and ownership apart by conduct or otherwise. After 12-7-1971, the date of the sale in their favour, therefore, the appellants' only right in the land was that of owners and they ceased to be tenants thereof.
5. Learned counsel for the appellants, however, relied upon a judgment of the Lahore High Court reported as Muhammad IOW v. Nazir Ahmad , and contended that the fact of the sale in favour of the appellants made no difference so far as their right of pre-emption as tenants under the Land Reforms Regulation is concerned. The following observation from the judgment was relied upon by the learned counsel :- "Thus, if the appellants were, in fact, occupying the disputed land as tenants at the time of its sale in their favour, the respondents, who claim pre-emption for being collaterals of the vendor, would not get the land in preference to the appellants. The learned District Judge had, therefore, erred in making observation implying that if the sale of any land is made in favour of its tenant, he cannot1 make use of his first right of pre-emption for the purpose of defending a suit for preemption in regard to such sale."
' The reported case is no authority for the proposition that even if the tenants purchase the land comprised in their tenancy prior to the coming into force of Article 25(3) of the Land Reforms Regulation, their superior right to pre-emption as tenants will be available to them to defend a suit for pre-emption against them. The facts have not been stated in sufficient detail in the reported judgment and it cannot, therefore, be said whether the sale in favour of the tenants in that case had taken place before or after the coming into force of the aforesaid provisions. However, from the judgment it appears that in that case the sale in favour of the tenants took place after the coming into force of the Land Reforms Regulation and the only question was whether the tenants/defendants could defend the suit of a collateral on the basis of their superior right of pre- emption on the date of the sale. There can be no doubt that if the vendee has a superior right of pre-emption on the date of the sale, vis-a-vis, the preemptor, he Can defeat the suit of the latter and indeed even subsequently' if he is able to improve his status as a defendant before the institution of the suit, he can defeat the rights of the plaintiff-pre-emptor. But the present case is distinguishable on facts, in that, the appellants did not have a superior right of pre-emption on the date of the sale, after which they incapacitated themselves from acquiring the right of pre- emption conferred on the tenants under Article 25(3) of the Land Reforms Regulation.
6. In Muhammad Khan v. Muzaffar , this Court has held that if a vendor sells the land to a tenant, the superior right conferred on the latter under Article 25 of the Land Reforms Regulation cannot be defeated on the ground that by the very same sale the rights of tenancy ceased to exist and, therefore, the tenant lost the superior rights conferred under the latter provision. If on the date of the sale the tenant has preferential right of pre-emption over all rights of pre-emption under section 15 of the Punjab Pre-emption Act, the vendor would be complying with the dictates of the general law of pre-emption in accepting the offer of a would be pre-emptor and selling the land to him.
7. After hearing the learned counsel for the appellants, we find that the appellants had not improved their status, in any way, to defeat the right of the respondent. The learned counsel for the respondent advanced an argument in support of the decree passed in favour of the respondent on the ground that the appellants having joined a stranger (a non-tenant) with them in the sale, had relegated themselves to the position of strangers qua the land comprised in the sale and had, therefore, no right of pre-emption by virtue of the doctrine of sinker. However, in the view that we have taken, it is not necessary to enter into this question, particularly when no such plea seems to have been raised before the Courts below.
8. For the foregoing reasons there is no merit in this appeal which is accordingly dismissed with costs. 1980 CLC 1012 PLD 1983 SC 181