1. HAMOODUR RAHMAN, C. J. The dispute in this case relates to the transfer of an evacuee house bearing No. J. M. 3/450 situated at 36/4, Clayton Road, Karachi.
2. Before the above-mentioned property became an evacuee property, the husband of the respondent No. 5 herein obtained possession of it under an order passed by the Rent Controller.
3. Karachi, on the 17th of February 1948, in exercise of the powers conferred upon him under section 15(1) of the Karachi Rents Restriction Act, 1947. The order was in these terms :- "In exercise of the powers conferred on me under section 15 (1) of the Rent Restriction Act, 1947, I direct that the above bungalow be let out to Mr. M. I. Merchant as soon as, it is vacated by the original tenant on expiry of a fortnight after issue of this order unless appealed against."
4. Mr. Merchant, who is a Barrister-at-Law, bas appeared on behalf of his wife (respondent No. 5 herein) and states that this was in exchange for leasehold accommodation given by him to the Hindu owner of the house in dispute with the permission of the Government of Bombay, granted by its letter of the 9th of February, 1948. This letter reads as follows:- "Subject :-Exchange of Accommodation with that in Pakistan.
5. Sir, With reference to your letter dated 23rd December 1947 on the above subject, I am directed to state that Government is pleased to permit exchange of your flat No. 14 in Rehmat Manzil, Opposite Church-gate Station with the bungalow of Mr. M. G. Shahani, situated in Amil Colony, Clayton Road Karachi.
6. By order of the Governor of Bombay.
7. (Sd.)
8. Secretary to the Government of Bombay, Health and Local Government Department: When the Custodian organisation came into existence, he offered to pay rents to the Custodian Department. Some rents were at first accepted, but the Custodian Department later on refused to accept rent, and in June 1954 issued notice to him to explain the circumstances in which he had sub-let the upper floor of the tenement.
9. The Deputy Rehabilitation Commissioner also issued a notice under section 8(2) (b) of Ordinance No. XIX of 1948 read with rule 6(a) of the Pakistan (Rehabilitation) Rules, 1951 to the sub-tenant to show cause as to why he should not be evicted from the said premises.
10. The respondent No. 5 and her husband thereupon on 7-7-54 applied for the possession of the first floor. The respondent No. 5 claimed that her brother had taken the house in exchange for his property in India on 30th of April 1949, and since her brother had since died issueless in 1951, she had inherited the bungalow as his heir.
11. Mr. Merchant, on the other hand, claimed that he was entitled to the possession of the entire bungalow on the basis of the allotment by the Rent Controller which should be treated as a valid allotment under section 14, subsection (2) of Ordinance No. XV of 1949.
12. The Deputy Rehabilitation Commissioner, Karachi, rejected both these applications on the 10th of July 1956, but only Mr. Merchant went up on an appeal against this order to the Rehabilitation Commissioner, Karachi. This too was rejected on 14-9-56 on two grounds, namely-
(1) that Mr. Merchant had himself given possession to the sub-tenant and had actually helped him to get his name recorded in the Custodian register as a tenant ; and
(2) that an allotment by the Rent Controller was not a valid allotment under the Ordinance of 1949.
13. No further appeal or revision was taken from this order either by Mr. Merchant or his wife, but bath of them applied for the formal allotment of the upper floor to them. The Assistant Rehabilitation Commissioner rejected their applications and allotted the upper floor to the appellant on 21-11-57.
14. Possession thereof was also delivered to him on 1-1-58.
15. Again, no further appeal or revision was taken from this order, but Mr. Merchant alone applied to the Assistant Rehabilitation Commissioner in February 1958, for the formal allotment of the ground floor, and an order in that behalf was made under section 18 of the Pakistan (Administration of Evacuee Property) Act (XII of 1957) on 4-3-58.
16. Subsequently, when settlement operations started, both the appellant herein as well as the respondent No. 5 filed C. H. Forms for the transfer of the entire house. Mrs. Merchant claimed on the basis of the allotment in favour of her husband in respect of the ground floor.
17. The Deputy Settlement Commissioner, treating the house as being indivisible, transferred it to the appellant by his order of the 1st of February 1960, and rejected the claim of Mrs. Merchant. A P. T. O.
18. Was also issued to the appellant on the 13 of February 1960, although an appeal had been taken against the said order of transfer by respondent No. 5. This appeal was dismissed by the Additional Settlement Commissioner, but the Settlement Commissioner, by his order of the 11 of August 1961, set aside the order of transfer and directed the transfer of the entire bungalow to Mrs. Merchant The appellant sought to challenge this order by a revision application, but the same was rejected by the Settlement Commissioner, Multan Division, exercising the powers of the Chief Settlement Commissioner on the 8th of May 1962. He then invoked the writ jurisdiction of the High Court but failed both before a learned Single Judge as also before the Letters Patent Bench.
19. Leave was granted by this Court on the 2nd of June 1967, to consider three points, namely :- (1)whether possession under an order passed by the Rent Controller under section 15 of the Sind Rent Restriction Act, 1947, could be treated as possession under an allotment order within the meaning of the Displaced Persons (Compensa--petition and Rehabilitation) Act, 1958 ;th th (2)whether the respondent No. 5 could claim the benefit of the extended definition of "possession" under the notifica--petition of the 13 of October 1.959; and
(3) whether the respondent No. 5, not being a direct claimant, could compete successfully with the present appellant who was a direct claimant.
20. Learned counsel appearing in support of this appeal contends that the order of the Rent Controller passed on the 17 of February 1948, which has been quoted earlier, was an order directing the landlord of the premises to "let out" the same to Mr. Merchant at a time when the Evacuee Laws had not been extended to Karachi. This was thus a creation of a lease and not an allotment. This is also supported by the fact that Mr. Merchant, on his own admission paid rent for a number of years to the Hindu owner while he was still in Karachi. The claim of Mr. Merchant that these premises were obtained by him in lieu of his leasehold interest in another property in Bombay given to him by the Government of Bombay would also show that the relationship sought to be created under the order of the Rent Controller was one of landlord and tenant end not that of an allottee of an evacuee property vis-a-vis the Custodian who was not, according to the statement of Mr. Merchant himself, installed In office in Karachi until November 1949.
21. Learned counsel further contends that an allotment can only be an allotment within the meaning of subsec--petition (2) of section 18 of the Administration of Evacuee Property Act, 1957, if it has been made under that Act or the Sind Economic Rehabilitation Ordinance, 1947, or some other law dealing with the rehabilitation of displaced persons.
22. The Sind Economic Rehabilitation Ordinance (IX of 1947) came into force on the 27 of October 1947. The object of this Ordinance was to repair the dislocation in the economic life of the Province caused by the abandonment of lands and buildings and the closing down of businesses and undertakings on account of the owner, or, as the case may be, the tenants, employees or workmen having migrated from the province. It contemplated that where buildings or lands had been left unoccupied owing to the migration from the Province of the owner, tenant or occupier, the Rehabilitation Officer appointed under the said Ordinance may assume possession of such abandoned lands or buildings, businesses or undertakings and grant the same on a temporary lease to any refugee or any other person for a term not exceeding one year at a time.
23. The Rehabilitation officer was to be appointed t)y the Provincial Government under section 3 of this Ordinance by a notification published in the official Gazette.
24. The scheme of the Sind Rent Restriction Act, which came into force on the 28th of September 1946, on the other hand, was to regulate the supply of accommodation, to control rents chargeable for such accommodation and also to control the eviction of persons already in occupation of such accommodation. The Rent Controller had also to be appointed by a notification in the official Gazette and amongst the powers given to him was the power under section 15 to direct the landlord of any vacant premises or premises about to become vacant to let the same to another person.
25. There is nothing before us to show that Rent Controllers appointed under the Sind Rent Restriction Ordinance of 1946 were also appointed Rehabilitation Officers under the Sind Economic Rehabilitation Ordinance, 1947.
26. Apart from this, learned counsel contends that although the word "allotment" has not been defined in any relevant statute, the power to allot has been given only to a Rehabilitation Authority by section 18 of the Pakistan (Administration of Evacuee Property) Act, 1957. This section reads as follows :- "Allotment of Evacuee Property for Rehabilitation.-(1) A Rehabilitation Authority may, for the purposes of the rehabilitation of displaced persons, or social or economic rehabilitation in Pakistan, allot to any person any evacuee property or property of which the Custodian has taken possession under section 13 :th th th Provided that no property which is subject to an order under clause (b) of subsection (2) of section 25 shall be allotted by the Rehabilitation Authority without the previous approval in writing of the Custodian.
(2) Every allotment of evacuee property made between the first day of March 1947, and the commencement of this Act, shall be deemed to have been made under subsection (1).
(3) Where any evacuee property has been allotted under this section the Rehabilitation Authority making the allotment shall, as soon as may be, furnish to the Custodian such description of the property allotted and such particulars of the person to whom it has been allotted as may be prescribed.
(4) The terms and conditions on which evacuee property, whether allotted before or after the commencement of this Act, may be held shall be determined by the Custodian and the Custodian may revise or amend such terms or conditions.
(5) Every person to whom evacuee property has been allotted shall be deemed to hold the property on the terms and the conditions determined under subsection (4).
(6) If any person fails to comply with the aforesaid terms and conditions the Custodian may eject such person and take possession of the property."
27. It will be observed from the above that the allotment has to be-
(1) for the purposes of rehabilitation of displaced persons ;
(2) for the social or economic rehabilitation in Pakistan of such displaced persons ; and
(3) of evacuee property of which the Custodian has taken possession under section 13 of this Act.
28. Subsection (2) of the said section, however, provides that every allotment of evacuee property made between the first day of March 1947 and the commencement of this Act, shall be deemed to have been made under subsection (1). Mr. Merchant has, therefore, relied on this subsection to support his contention that an allotment by a Rent Controller is also to be deemed to be an allotment under subsection (1) of section 18 of the Pakistan (Administration of Evacuee Property)
29. Act, 1957.
30. This argument would, no doubt, have been tenable if, as contended by the learned counsel for the appellant, it could have been shown that the allotment, under whatever law made between the first of March 1947, and the 15 of March 1957, was made for the purposes of rehabilitation of displaced persons or for their social and economic rehabilitation in Pakistan. The question, therefore, that we have to determine is: whether the order made by the Rent Controller on the 17 of February 1958, though described as an allotment order, was made for anyone of the above purposes. In order to qualify as an allotment order under the Pakistan (Administration of Evacuee Property) Act, 1957, this condition had to be fulfilled.
31. Learned counsel for the appellant has, of course, laid great stress upon three circumstances which, according to him, negatived the possibility of the Rent Controller's order coming within the ambit of orders which could qualify as "Allotment Orders" under section 18 of the Pakistan (Administration of Evacuee Property) Act, 1957.
32. This order, it is pointed out, was made at a time when evacuee laws had not been extended to Karachi, the order merely directed the Hindu landlord who was still in Karachi to let the premises upon their becoming vacant to Mr. Merchant and in pursuance to this order Mr. Merchant entered into possession as a lessee and paid rents to the Hindu landlord until the Custodian Authorities came into being in Karachi.
33. These facts, learned counsel, urges clearly show that the order of the Rent Controller was not an allotment order and was not intended to be one. It was merely an order made by the Rent Controller in the exercise of his ordinary jurisdiction under the Sind Rent Restriction Ordinance, 1946, and had nothing whatever to do with the rehabilitation of any displaced person or the social or economic rehabilitation of any one in Pakistan.th th Learned counsel has also pointed out that "possession", under subsection (6) of section 2 of the Displaced Persons (Compensation and Rehabilitation) Act. 1958, means possession obtained in pursuance of an order passed on or before the 20th day of December 1958, by a Rehabilitation Authority or a Custodian or any other officer authorised or permitted by the Central or Provincial Governments in that behalf provided that, if a question arises as to whether an officer is so authorised or permitted, the decision of the Chief Settlement Commissioner in that behalf shall be final.
34. It is also not the case of either respondent No. 5 or her husband, Mr. Merchant, that the premises were obtained for their social or economic rehabilitation. In fact, Mr. Merchant had claimed that he had obtained possession of the premises in exchange for the premises in his possession in Bombay which had been given to him by the Government of Bombay. So far as Mrs. Merchant is concerned, she appears to be a wealthy lady and had actually under a Deed of Exchange executed on the 14 January 1948 exchanged four of her properties situated at Bombay with four properties in Karachi belonging to one Jairamdas Naumal. This exchange has also since been confirmed in her favour by an order of the Deputy Custodian (Judicial) dated the 24 February 1951 (vide page 290 of the record). Her husband was also given employment as Honorary Special Magistrate at Karachi. Thus neither husband nor wife was in need of any social or economic rehabilitation.
35. This was the view taken by the High Court in the case of M. N. Baker v. Federation of Pakistan (PLD 1956 Kar. 217) but Mr. Merchant has relied on a later decision of another Division Bench of the same High Court, Karachi Seat, to the case of Muhammad Ishaq v. Dr. Saiduddin Swaleh (PLD 1960Kar.
36. 48) to support his contention that an order of a Rent Controller is, in effect, an allotment by the Rehabilitation Department itself. The facts of the decision cited are, however, distinguishable. There the order of the Rent Controller had been adopted by the Custodian Department as their own. The position here is otherwise. As soon as this allotment came to the knowledge of the Custodian Authorities as a result of the dispute regarding the possession of the upper floor, they caused notices to be issued to the sub-tenant of Mr. Merchant for his eviction from the first floor and not only he but also the Merchants were in fact, evicted there from and the first floor was allotted to the appellant on the 21 of November 1957. He entered into possession thereof on the 1st of January 1958. From this order, Mr. Merchant, went on appeal, but when that --appeal failed, be made no further effort to challenge the order allotting the first floor to the appellant. Indeed thereafter both Mr. And Mrs. Merchant completely abandoned their claim to the property on the basis of the order of the Rent Controller and made a fresh application for the allotment of the ground floor only to the Rehabilitation Department. This order was made in their favour on the 4th of March 1958. The allotment order of the Rent Controller was, therefore, never adopted by the Rehabilitation or the Custodian Departments. The decision cited, therefore, does not assist the respondent No. 5.
37. Mr. Merchant has also relied on the observations of the: Settlement Commissioner and of the Chief Settlement Commis--sioner in their respective orders of the 11th of August 1961, and the 8 of May 1962, to show that the Settlement Authorities, at any rate, treated the Rent Controller as a competent allotting authority in 1948. The Settlement Commissioner gives no reason for holding that the Rent Controller was the proper allotting authority in 1948. No notification to that effect has been referred to nor have the reasons given by the Rehabilitation Authorities and the Additional Settlement Commissioner for rejecting this contention been dealt with. The Chief Settlement Commissioner has, of course, held that the order of the Rent Controller in the case was made for purposes of "social and economic rehabilitation of the refugees", even though there is nothing in the order of the Rent Controller itself to support this. Indeed, as already pointed out, the Rent Controller's order seems, to indicate that it was an order made in the exercise of the ordinary jurisdiction of the Rent Controller to let out a vacant premises or premises about to fall vacant to ath th st th specified person. Apart from this there is no factual basis for this observation as neither Mr. Merchant nor his wife needed social or economic rehabilitation. The former had obtained employment in Pakistan and the latter had obtained four properties in Pakistan in exchange for her properties in India. In the facts and circumstances of this case, to which we have referred earlier, we are, therefore, unable to agree that the order of the Rent Controller in the present case could be treated as an order of allotment. The first order of allotment that was made in favour of Mr. Merchant was on the 4th of March 1958, and it was an order made on their own application on a date subsequent to the date of allotment in favour of the appellant. On the basis of allotment, therefore, the appellant had a preferential right to the transfer of the premises.
38. Mr. Merchant has next sought to rely upon the fictional "Possession" of his wife under the notifications of the 7th of March 1960, and the 11 of August 1960. The notification of the 7th of March 1960, reads as follows :- "The Central Government has decided that where a house is in the possession of the husband in pursuance of the order passed on or before the 20th day of December 1958 by a competent authority, his wife, if staying with him, will also be deemed to be in possession."
39. The notification of the 11 August 1960 is in these terms :- "In exercise of the powers conferred by the second proviso to clause (b) of section 2 of the Displaced Persons (Compensa--petition and Rehabilitation) Act, 1958 (XXVIII of 1958) the Central Government is pleased to order that the allottees of a house or a shop for whose benefit ejectment proceedings have been ordered by a Court or a Rehabilitation Authority and who, through no fault or negligence of their own, have so far been unable to obtain physical possession of the house or the shop in question shall be deemed to be in possession thereof for the purpose of the said Act."
40. The notification of the 11 August 1960 has no application in the facts of this case; but so far as the notification of the 7tb March 1960 is concerned the position, as rightly pointed out by the learned counsel for the appellant, appears to be that the wife will also be deemed to be in possession if the posses--sion of the husband is in pursuance of an order passed by a competent authority on or before the 20 of December 1958. If, as we have held, the only order for the possession of the husband passed by a competent authority was the order of allotment passed on the 4 of March 1958, then Mrs. Merchant would also be deemed to be in possession from the 4 of March 1958; but this will not serve her purpose, for even then, the appellant would be a person in prior possession. In order to succeed on the basis of this notification, it must be shown that Mr. Merchant was in possession of the premises in pursuance of some order passed in his favour by a competent authority before the 21 of November 1957, i.e., the date of the allotment in favour of the appellant.
41. Since we have not accepted the order of the Rent Controller as an order of allotment under the Pakistan (Administration of Evacuee Property) Act, 1957, or the Pakistan (Administration of Evacuee Property) Ordinance, 1949, the only order in favour of Mr. Merchant is that of the 4th of March 1958.
42. Mr. Merchant, however, contends that even if this notification of the 7th March 1960 does not help his wife she can fall back on the extended definition of possession under the notification of the 13th October 1959.
43. The benefit of this notification can be taken only subject to the following conditions :-
(a) That the person concerned should not have obtained possession of the house in pursuance of an order passed by a competent authority on or before the 20 of December 1958.
(b) That he should have been in undisputed occupation since before the 21st December 1958.
(c) That no other person is otherwise entitled to the transfer of the premises in pursuance of any final order passed by a competent authority before the 21 December 1958.
(d) That the rent and other dues in respect of the premises have been cleared by the occupant.
44. The first condition is not satisfied in the present case because the possession of Mr. Merchant and/or his wife is in pursuance to an order of a competent authority passed on the 4th March 1958th th th th th th st th st before the specified date. They cannot, therefore, take advantage of the extended definition of "possession" given by this notification. In any event Mrs. Merchant cannot take advantage of a double fiction. She can only be deemed to be in possession in the circumstances specified in the notification of the 7 March 1960.
45. We have dealt with this question as it has been referred to fin the leave granting order, although, as admitted by Mr. Merchant himself, this point was not raised at any stage below; nor has it been taken in the concise statement filed herein. In this connection, it is also significant to note that, in an affidavit filed by Mr. Merchant himself on the 15th of February 1958, when applying for the allotment of the ground floor of the premises in dispute, he categorically stated as follows :- "That I have not secured by way of allotment of there in (sic) my name or in that of any my relations any evacuee property in Pakistan."
46. This is a clear admission that he has not obtained any allotment of the property in dispute or any other property in Pakistan. He cannot, therefore, now be heard to say that the earlier order of the Rent Controller should be treated as an allotment order by the Rehabilitation Department after he had himself abandoned that position in February 1958 and applied for the fresh allotment of only the ground floor.
47. These are all the points that have been urged before us, and since we have come to the conclusion that the appellant was a prior allottee and, therefore, had a preferential right to the transfer of the property in dispute, we allow this appeal and set aside the judgments and orders of the High Court, the Settlement Commissioner and the Chief Settlement Commis--sioner.
48. The appellant will also be entitled to the costs of this appeal.