1. WAHEEDUDDIN AHMAD, J.-This appeal by special leave is directed against the judgment of the former High Court of West Pakistan, Lahore, in L. P. A. No. 4 of 1966, dated the 15 February 1966. By this judgment, the appeal filed by the appellant, was dismissed in limine.
2. The dispute in this case relates to House No. 15, Block No. 10, Street No. 1, Khanewal, District Multan.
3. The house in dispute is occupied by two persons, namely, Malik Sarwar Khan the appellant. And Khan Muhammad. The appellant got into possession of a portion of the house in dispute 9n January 1952 and later in 1953, he was allotted the northern portion of the said house. The rent of this portion of the house was deducted from the Day of the appellant through his Department. The southern portion of the house in dispute was occupied by Mistri Khan Muhammad.
4. The appellant and Mistri Khan Muhammad both applied on L. H. Forms for transfer to them of the respective portions in their possession. In the first instance, the case of transfer was taken up by the Deputy Settlement Commissioner on the 24 December 1959, who finding that the evaluation price of the house was Rs. 16,160 rejected both the L. H. Forms of the appellant and Mistri Khan Muhammad. Later on, the Assistant Settlement Commissioner took the case on his own accord and side order dated the 7 March 1960, transferred the house in dispute to the appellant but at the same time ordered the office for putting up the case on the 10 March 1960. On the 10 March 1960, the same Assistant Settlement Commissioner ordered that the whole house be transferred to the appellant who should associate the claimant in the ownership of the house and that the public dues if any, would be adjusted against Schedule VI of the claimants association. Thereupon, Khan Muhammad, the other occupant of the house in dispute, made representation. The Deputyth th th th th Settlement Commissioner took up the matter and after hearing both the parties, ordered on the 20 May 1960, that the house should be transferred to the present appellant and Khan Muhammad according to their possession. The matter did not rest there. The same Deputy Settlement Commissioner, later on, after obtaining necessary permission from the Settle--ment Commissioner, revised the case by order dated the 16 September 1960 and held that the price of the house in dispute being above Rs. 10,000, it could not be transferred to the locals and as such ordered to dispose of the house through auction.
5. Both the appellant and Khan Muhammad filed appeal which was rejected by the Additional Settlement Commissioner on the, 6th April 1961 on the ground that the price of the house exceeds Rs. 10,000 and that the appellant had not cleared the rent. The appellant filed review application which was rejected by the Additional Settlement Commissioner on the 21 February 1962. The appellant then filed a revision petition in the Court of Settlement Commissioner which was rejected on the 31st March 1962 on the following observation:- "This is a revision against the order of the Additional Settlement Commissioner dated the 21st February 1962. The dispute is in respect of property No. 15-B, Block No. 10, Khanewal. The petitioner who is a local has not paid the arrears from 1 October 1959 to 31 December 1959. The defect cannot be remedied, rejected."
6. The appellant challenged this order in Writ Petition No. 1723/R of 14402, which was dismissed on tire 13th December 1965. His. Letters Patent Appeal was dismissed in limine (in the 15 February 1966.
7. His review application before the Letters Patent Bench was dismissed in limine on the 22 March 1966. The appellant has challenged these orders in this appeal before as.
8. Special leave was granted in this case to consider two points- (i)whether the appellant who is a local was not entitled for the transfer of the house in dispute as he had not cleared the arrears of rent, and
(ii) whether the house had been divided into two separate portions and only the valuation of the portion in possession of the appellant was relevant for the purpose of deciding whether it was eligible for its transfer or not.
9. Malik Saeed Hassan, learned counsel for the appellant has, contended that the appellant is an allottee and being an allottee it was not necessary for him to clear the arrears of rent before the property in dispute was transferred to him. Ii this connection, he referred to the order of the Central Government which was issued on the 13 October 1959, in exercise of the powers. Conferred upon it by the second proviso to clause (6) of section 2 of the Displaced Persons (Compensation and Rehabilita--petition) Act. The notification is reproduced below:- "The Central Government is pleased to direct that a clai--mant, a non-claimant displaced person or a local who has not obtained possession of a house or a shop in pursuance of an order passed by a competent authority on or before the 20 day of December 1958, shall for the purpose of the aforesaid Act, be deemed to be in possession thereof, if he has been in undisputed occupation of the house or the shop since before the 21 day of December 1958, and no other person is other-- wise entitled to the transfer of such house or shop in pursuance, of a final order passed by a competent authority before that" day: Provided that the rent and other public dues in respect of such house or shop have been paid by the occupant from the date of his occupation and, if he is a claimant, such amount is adjusted against his claim."
10. It will thus be noticed that it i9 only in respect of persons who are not in occupation of the premises in pursuance of an order passed by a competent authority that the condition of clearance of rent is imposed. So far as the persons who are allottees are concerned, no such condition is applicable to them and the house can be transferred to them without imposing any such condition.th th st st st th nd th th st Sardar Hidayatullah Moakal, learned counsel for the Department, contended that there is no proof that the appellant is allottees, of the premises in dispute. The contention of the learned counsel has no force. There is a concurrent finding of fact that the appellant is an allottee of the house in dispute. In the face of this clear finding, it does not lie in the mouth of the Department to contend that the appellant is not an allottee of the house in dispute. In these circumstances, we are of the opinion that the claimants, non-claimants, displaced Persons and locals who are in authorised possession of the premises are not liable to clear rents before a transfer order is issued in their favour. Such rent can be recovered from them by instalments or by other means after the transfer order is issued to them. In view of this conclusion, the learned Settlement Authorities were not justified in refusing to transfer the portion of the house in possession of the appellant to him on this ground.
11. The next point for consideration is whether the house in dispute consists of two separate wings which are independent self-contained portions and each portion can be used as self-- sufficient unit. In this connection, the learned counsel for the appellant, has referred us to Vie extract of the Municipal Register of 1946 of Khanewal, which shows that there had been two families living in the house in question before Partition and the two portions had been assessed separately. After Partition, the property in dispute was occupied by two persons, namely, the appellant and Mistri Khan Muhammad. It is thus clear that there are two independent units occupied by two different persons. The learned Deputy Settlement Commissioner, by order dated the 30 May 1960, made the following observation in respect of the transfer of the house in dispute:- "I, therefore, order that the portion occupied by Sarwar Khan will be transferred to him, similarly the portion of Khan Muhammad will be transferred to him. Forms submitted by them are hereby accepted. The P. T. O's. May be issued. Sarwar Khan can associate a claimant in the portion given to him."
12. It was urged on behalf of the Department that the value of the house in dispute was more than Rs.
13. 10,000 and that the house could not be divided for purposes of transfer to a local. In this connection, reference was made to instructions contained in Memorandum No. 7355-PI-Reb/60, dated the 2nd May 1960, which is reproduced below:- "In accordance with para. 3 of the Schedule ;o the Displaced Persona (Compensation and Rehabilitation) Act, 1958, a local in possession of a hove is entitled to the transfer of the house if its value does not exceed Rs. 10.000. It has however been observed that the locals are being transferred houses the value of which exceeds the prescribed limit after dividing them into portions valued at less than Rs. 10,000, The Chief Settlement commissioner desires that complete units of houses of the value of Rs. 10,000, or less only should be transferred to the locals in possession and the houses the value of which is more than Rs. 10,000 should not be divided in order to make the local in possession entitled to the transfer of a portion thereof, unless such division existed before Partition and the sub-divided unit is an independent residential premises in every respect."
14. It is quite true that the house cannot be divided for purpose o transfer to the locals but if such division exists before Partition and the sub-divided unit is an independent residential premise. In every respect this restriction is not applicable. In the present case, there is evidence that the house from pre-Partition day was occupied by two families and consisted of two units. After Partition, the same position continued. In these circumstances. The above-mentioned memorandum does not stand in the way of the appellant. It rather helps him.
15. After careful consideration of the points raised in this matter we are of tee opinion that the portion of the house in occupation of the appellant ought to have been transferred to him and should not have been disposed of by auction. Accord--ingly the order of the Settlement authorities is set aside as being without lawful authority and the Department is directed to transfer the portion in possession of the appellant to him on payment of the price determined by the Department. Theth rest of the portion will remain with Abdul Majid respondent No. 5. He will be entitled to the refund of the excess amount paid by him in tie auction.