1. MUHAMMAD HALEEM, ACTG. C. J.-This appeal, by special leave, arises from the judgment of the Lahore High Court, Lahore, dated 27th of September, 1974, by which L. P. A. No. 390 of 1966 was allowed and the order of the Chief Settlement Commissioner dated 4th of July, 1961, upheld.
2. Leave to appeal was granted to examine whether the second respondent had the entitlement for the transfer of the first floor of house bearing No. R./106, Jhangi Mohallah, Rawalpindi City, to him and also as to the criterion for the division of the house.
3. The house comprises two storeys. The first was admittedly occupied by the appellant who is a claimant displaced person. The ground floor was allegedly stated to be in the occupation of the second respondent alongwith his five other brothers. Upon the commencement of settlement operations, the appellant submitted his C. H. Form for the transfer of the whole house; and as no other occupant of the ground floor had, by then, applied for its transfer, the Deputy Settlement Commissioner, by order dated 4th of December, 1959, transferred the entire house to the appellant.
4. In the events that followed, the second respondent, while residing in Sargodha, executed a power of attorney on 22nd of December, 1959, in favour of his brother Ahmad Hussain authorising him to submit the C. H. Form for the transfer of the house in his favour as he was unable to do so personally, consequent upon his claim having been verified. Ahmad Hussain submitted his C. H.
5. Form on 30th of December, 1959, in which his entitle--ment was sought to be made out on the basis of the possession of his daughter, Mst. Sarwari; and further against column No. 5, which related to the query as to possession, his brothers, Ahmad Hussain, Abdul Razzaq, Muhammad Iqbal, Fateh Muhammad and Imam Din were shown as the occupants and the date of possession of his daughter was shown as from 1949. Before the acceptance of the form, Ahmad Hussain represented to the Settlement authority that he had earlier submitted his N. C. H. Form by registered post but apparently no action had been taken and to assert his claim, he produced a receipt of the postal department which pertained to the delivery of the registered letter to the addressee but as the form was not traceable iii the office, the C. H. Form was accepted on 11th of February, 1960. However, by a letter dated 12th of March, 1960, he was informed by the Deputy Settlement Commissioner, Rawalpindi, that as his belated form was received after the property had already been disposed of, it could not be considered.
6. Against this communication; he filed an appeal before the Additional Settlement Commissioner who upheld the order of transfer in favour of the appellant holding at the same time that the house was indivisible. The Revision before the Settlement Commissioner failed as it was dismissed on 14th of November, 1960. He, thereupon, filed the second Revision before the Chief Settlement Commissioner and succeeded as his possession on the basis of the entry in the Survey Register for the year 1958-59 was accepted; and as both the claimants were non-allottees in occupation of one storey each, they were respectively transferred the floors in their possession. This order is dated 4th of July, 1961; and by it the house stood divided. The appellant challenged this decision in the former High Court of West Pakistan through Writ Petition No. 1113-R of 1963 and succeeded as the second respondent was not able to establish his entitlement in regard to his possession of the house either through his daughter, Mst. Sarwari, or himself personally.
7. The second respondent filed an Inter Court Appeal and by order dated 27th of September, 1974, the Division Bench upheld the order of the Chief Settlement Commissioner on the basis of its division into two units as accord--ing to the possession of each party. Such division of the disputed house into two units was held to be "indubitable".
8. It is contended on behalf of the appellant that the Division Bench did not apply its mind to the entitlement of the second respondent qua his possession and further as to whether such division was warranted as ordered by the Chief Settlement Commissioner. We have examined the orders of the Settlement authorities on record and that of the learned Single Judge of the High Court and are of the opinion that the conclusion of the Chief Settle--ment Commissioner was arbitrary and capricious. Adverting now to the question of entitlement we find that in the Memo of Appeal filed before the Additional Settlement Commissioner, he based his entitlement on the posses--sion of his daughter and claimed for the division of the house. The Additional Settlement Commissioner, however, after spot inspection held that the house was indivisible and that its transfer as such to the appellant was perfectly justified. There is nothing in this order to show that the second respondent's claim qua the possession of his daughter had any factual truth in it. But the Settlement Commissioner, in Revision, held that the second respondent himself resided at Sargodha alongwith other members of his family and had, accordingly, failed to prove his direct possession. The result was that the transfer of the house in favour of the appellant was upheld as he was found to be in possession of the first floor.
9. The Chief Settlement Commissioner, however, relied for his claim to Possession on an entry in the Survey Register for the year 1958-59 without any further evidence to augment his direct possession and, accordingly, divided the house into two units. Here we may point out that qua his C. H. Form he had, not claimed direct possession but through his daughter and he was not also shown to be in possession in column No. 5 of that farm. The Chief Settlement Commissioner, without examining the claim at his possession, which was through his daughter, cursorily placed reliance a document which intended to establish his direct possession which is not his case. Subsequently, it also transpired, on the showing of the Settlement Department itself, that no survey had been conducted by the Rehabilitation Authorities during the year 1958-59 and hence the authenticity of this document was also highly doubtful. On this premise, he ordered the division of the house into two units without examining whether the division into two independent units would be feasible or not.
10. Before the learned Single Judge the question as to possession was agitated by the parties. In the written statement, filed by the second respondent, his claim was that he was in possession of the first floor along--with his brothers and his daughter, Mst. Sarwari. However, he alleged that in the N.
11. C. H. Form earlier submitted by him through post, he had asserted his claim of possession both through his daughter and himself personally but in the C. H. Form submitted by him through his attorney, his personal claim of possession was omitted. He also filed documents to establish his possession. In para. 4 of the comments submitted by the Settlement Department, it was stated that he himself resided in Sargodha which was evident from the power of attorney filed by him and that despite the fact that he had claimed the transfer of the house on the basis of the possession of his daughter, Mst. Sarwari, yet she was not shown as a joint occupant against column No. 5 of the C. H.
12. Form. Further, her possession was not established from the Rehabilitation Department's Survey Register. The stand of the department thus was that neither he was an allottee nor in an undisputed possession of the first floor. Nonetheless, a vain attempt was made before the learned Single Judge to establish his entitlement qua direct possession as was held by the Chief Settlement Commissioner in his order although in his C. H. Form he had based it on his daughter's possession but did not succeed as the learned Single Judge, upon his qualitative examination of the documents filed by him and after taking into consideration the case of the Settlement Department and that of the appellant held that the second respondent was not able to prove his direct possession as he resided in Sargodha. As to the finding of the Chief Settlement Commissioner in regard to his direct possession, the learned Single Judge held that he merely relied on the solitary entry in the Survey Register which stood negatived by the report of the Settlement Department that no Survey was conducted in the year 1958-59 and as such the impugned order was manifestly unjust and improper. Concluding thus, on his inconsistent stand as to possession, the learned Single Judge observed "It appears that a daughter of Muhammad Hussain is married to his nephew at Rawalpindi.
13. Originally, neither Muhammad Hussain nor his brother bad a claim verified in their favour in respect of the property left in India. Muhammad Hussain according to his own showing filed an N. C. H.
14. Form but later on somehow or other he got his claim verified and tried to get the house transferred in his favour on a C. H. Form on the basis of possession of his daughter. Subsequently, he realised that as against a claimant in possession an indirect claimant out of possession had no chance to get the house transferred in his favour. He, therefore, manipulated the entries in certain documents to show that he was also in occupation of the house in dispute but this he failed to prove.
15. Muhammad Hussain was thus left to compete on the basis of possession of his daughter with a claimant in possession for the transfer of the house which was held by the Settlement Authorities to be indivisible and failed up to the level of the Settlement and Rehabilitation Commissioner in getting the house transferred to him."
16. From the above it is patently clear that the learned Single Judge did not embark on the inquiry of possession independently but in the context of the determination of the entitlement of the second respondent which was challenged in the High Court. The High Court elaborately dealt with each document and upheld the conclusion of the Settlement Commissioner as against that of the Chief Settlement Commissioner whose determination of this question was without any application of mind but rested on a spurious document. Accordingly, as contended by the counsel for the second respon--dent, we see no justification for any further examination of this question by the Settlement Authorities.
17. The Letters Patent Bench regarded the division of the property as' sacrosanct on the basis of possession, but this was not the criterion as possession was dissociated with the division of the property into independent and self-contained units as enjoined by the amended provisos to section 2(4) of the Displaced Persons (Compensation and Rehabilitation) Act, 1958. The Chief Settlement Commissioner, while dividing the house into two units, on the basis of possession, had no material to justify that each of the units was an independent and self-contained unit.
18. Possession, which though no established, was not a factor which could intervene for the exercise of the discretion. This connotation of the division of the house into two units based on the amended provisos is apparent from the decision of this Court in Abdul Majid Khaa v. The Chief Settlement & Rehabilitation Commissioner, Pakistan (PLD1968SC154). Hamoodur Rahman, J. (as he then was) observed while construing amended provisons to sections 2(4) and 2(12) as under :- "It is no doubt, true that in the provisos originally appended to sub--sections (4) and (12) of section 2 of the Displaced Persons (Compensation and Rehabilitation) Act, 1958, the word "unit" had not been used but it was said that where a building not declared to be a big mansion or hotel consisted of more than one 'residential premises' or business premises' and such premises were in possession of several persons, the premises in possession of any one such person shall be deemed to be a 'house' or a 'shop' as the case may be. But by the amendments made in 1959 the word 'premises' has been substituted by 'unit' and it has been provided that even if such units are in the possession of several persons the whole of the building may still be deemed to be a 'house' unless the Chief Settlement Commissioner orders otherwise. In the first portion of the amended provision, the word 'premises' has only been substituted by the word 'unit' but this change when read alongwith the new power given to Chief Settlement Commissioner, to treat several 'units' as a single 'house' or a single 'shop' notwith--standing the fact that each unit may be in possession of several persons, is not without significance. It clearly constitutes a departure from the previous rule that possession simpliciter by an individual was to determine whether a building was to be treated as a single house or as many houses as there were persons in possession there of. The word 'unit' in the mentioned proviso is, therefore, necessarily dissociated from its possession. The new power given to the Chief Settlement Commissioner is clearly designed to give him the latitude to see that the utility of the premises to be transferred to an individual is not impaired. The word 'unit' has, therefore, acquired a new signification which is more co-related to the structural characteristics of the building itself and in. This sense the word 'unit' is clearly intended to mean a division of the whole building which can be regarded as the least necessary to form an integrated portion capable of having a separate entity and being used as a self-contained portion."
19. Such being the rule of division, the Chief Settlement Commissioner fell into an error while taking into consideration the element of possession as providing a ground for the division of the house into two units. The Division Bench also fell into that error.
20. The appeal, therefore, succeeds and the order of the Letters Patent Bench 'is set aside and that of the learned Single Judge is restored. There will be noorder as to costs