This appeal arises out of a suit for possession through pre-emption of land measuring 334 Kanals 8 Marlas comprised in Khewat No.17, Khatum Nos.34 to 41, situate in Mauza Jaloowali, Tehsil and District Sialkot. It was agreed to be sold by its owner Munshi Khan and others to the appellants by agreement of sale dated 26th of February, 1975 for a sum of Rs.2,10.000. The agreement was, however, not performed by Munshi Khan and others, whereupon the appellants filed a suit for possession through specific performance of this agreement of sale which was decreed by Mr. Pervaiz Ahmad, Civil Judge, Sialkot on 20th September, 1977. On 19th of September, 1978, Khurshid Ahmad and others, respondents herein, filed a suit seeking to pre-empt what they termed as a sale of the land through the decree dated 20th of September, 1977. Though the transaction as a whole was pre-empted, but it was also mentioned that one Nek Muhammad who owned 11/45 share in the land, was neither a party to the agreement to sell nor in the suit for specific performance and as such the respondents did not acquire any title with respect to his share measuring 81 Kanals 15 Marlas. It was, therefore, pleaded, in the alternative, that the decree for the remaining area 252 Kanals 13 Marlas be passed by proportionately reducing the sale price to Rs.1,58,000. The suit was contested by the appellants, inter alia, on the ground that it was bad for partial pre-emption that the sale was not pre-emptible and in any case, as no sale-deed in pursuance of the decree for specific performance, had been executed either by Munshi Khan and other vendors or the Court on their behalf in favour of the respondents, the suit was premature and not maintainable. This contention of the appellants prevailed with the learned trial Court with the result that the suit of the respondents was dismissed on 24th of April, 1983. All other issues including that of partial pre- emption were, however, decided in favour of the plaintiffs/respondents.
2.Dissatisfied with this decision of the trial Court, the respondents filed an appeal which was accepted by Khan Talib Hussain Balooch, Additional DistrictJudge, Sialkot, on 8th of May, 1985 . He reversed the findings of the trial Court and decreed the suit. He also held that Nek Muhammad's share in the land could not have been sold. He, therefore, excluded his share and passed a decree to the extent of 252 Kanals 13 Marlas and also reduced the sale price proportionately from Rs.2,10,000 to Rs.1,57,500. Syed Manzoor Hussain Shah, defendant-vendee, has preferred this regular second appeal.
3. It has been contended on behalf of the appellants that as, no sale-deed had been executed either by the vendors in pursuance to the decree for specific performance or by the Court on their behalf in execution of the said decree, no sale had taken place and the suit filed by the respondents was premature. The learned counsel for the appellants also asserted that the suit of the respondents was bad on account of partial pre-emption and further that in any event, the respondents were bound to take transaction as a whole by paying the total price and it was not open to the lower appellate Court to have proportionately reduced the area and the price.
4. As regards first contention of the learned counsel for the appellants, it is to be noticed that the appellants had agreed to purchase the total land measuring 334 Kanals 8 Marlas for a sum of Rs.2,10,060 from Munshi Khan and others. They filed a suit for specific performance which was decreed on 20th of September, 1977. Admittedly, no sale-deed in pursuance of the decree, has either been executed or registered in favour of the appellants. In their pre-emption suit, the respondents treated the decree for specific performance as one effecting the sale in favour of the appellant and had sought to pre-empt the same. The question which falls for determination is, as to whether any title in the land stood transferred to or was vested in the appellants by virtue of decree for specific performance in their favour.
5.In law, a decree for specific performance declares the rights of the parties and entitles them to have the title transferred in accordance with the agreement to sell. It enjoins the parties to perform their part of the agreement and on their failure to do, the Court itself performs those obligations by carrying E out the act required to be done. Under Order XXI, rule 35, C.P.C. If a defendant fails or refuses to execute the necessary sale-deed, the Court itself can do on his behalf. However, as long as the deed is not executed the title vests in the vendor and does not pass on to the other party.
6. The nature of the decree for specific performance and the consequences flowing there from, came up for examination before this Court in Haji Abdul Rehman and 3 others v. Noor Ahmad and 3 others PLD 1974 BJ 25, wherein it was held by Muhammad Afzal Zullah J., (as he then was) that:- A decree for specific performance only declares the right of the decree-holder to have a transfer of the property covered by the decree executed in his favour. The decree by itself does not transfer title. That this is so apparent from the fact that in order to get title to the property the decree- holder has to proceed in execution in accordance with the provisions of Order XXI, C.P.C. So long as the sale-deed is not executed in favour of the decree-holder either, by the judgment-debtor in the suit or by the Court, the title to the property remains vested in the Judgment- _, debtor and till the execution of the sale-deed the decree-holder has no right to the possession of the property ...."
Reference may also be made with advantage to two other decided cases of this Court namely, Abdul Majid v. Nizam Din and others PLD 1959 Lah.273 and Muhammad Ishaq v. Muhammad Siddique PLD 1975 Lah. 909. It thus becomes clear that passing of the decree for spec performance does not transfer title nor can a sale of the property he said to have taken place on account of the passing of the said decree.
7. The learned counsel for the respondents, however, contends that the sale as contemplated by the Punjab Pre-emption Act, 1913 was different from the one visualised by the other Laws. According to the learned counsel, the question whether a sale has taken place so as to invest the pre-emptor with a right, can neither be examined nor decided with reference to the Transfer of Property Act or any other law as the pre-emptor in the event of success will acquire whatever title the vendee has in the property. The formalities required for completing the sale under other laws, in the submission of the learned counsel, need not be fulfilled as a pre-condition to the exercise of a right of pre- emption. The learned counsel has heavily relied upon the authority of the Supreme Court reported as Abdul Karim v. Fazal Muhammad Shah PLD 1967 SC 411.
8. There is no cavil with the proposition that the right of pre-emption is one of substitution and in the event of a suit being decreed the pre-emptor steps into the shoes of the vendee and if the title of vendee is defective, the pre-emptor would also get the defective title. However, according to section 4 of the Punjab Pre-emption Act, 1913 itself, the right of pre-emption arises in respect of a property only in case of sale or exchange. So long as a particular transaction between the parties does not amount to a sale, no right accrues in favour of a pre-emptor nor can any suit be filed in this behalf. It cannot be doubted that no suit for pre-emption can be filed, in respect of an agreement to sell the property, the reason being that such an agreement to sell does not create any title or interest in the property itself. Same position holds true as regards a decree for specific performance of the agreement. The authority relied upon by the learned counsel for the respondents deals with a situation in which though the intention of the parties was to bring about a completed sale but it remains incomplete on account of certain legal formalities required under a particular law. It does not deal with a situation where a mere agreement has been executed between the parties and the title, still remains to be transferred from one party to the other. The observations appearing at page 417 of the report which are reproduced below fully support this view:- If the transaction amounts to a sale in fact, then notwithstanding that it is not in the form prescribed by section 54 of the Transfer of Property Act the right of pre-emption will come into operation .
(underlining is mine)
This clearly brings into bold relief the distinction between a case where a sale in fact had taken place from that where no title at all passes under the transaction:
9. The analogy of an oral sale though in violation of the Transfer of Property Act, cannot be pressed into service here. In the former case, the parties clearly intend to transfer the title though in view of the bar created by law valid recognition is not accorded to it. However, in a case where agreement to sell only has been executed, neither the parties contemplate the transfer of title nor does, as a matter of fact, this transfer take place. The observations in Muhammad Bakhsh v. Ziaullah and others 1983 SCMR 988 while interpreting the provisions of section 53-A of the Transfer of Property Act, also support this view. As already observed, the decree for specific performance does no more than direct the parties to perform their respective obligations under the agreement.
10. It is not difficult to visualise where at the time of execution of an agreement of sale a part of consideration is paid leaving balance to be paid at the time of sale itself. In such a case, if a decree is passed, obviously the balance consideration has to be paid by the plaintiff before having the sale-deed executed in his favour. If the plaintiff, does not make the payment of the balance consideration, can it be said that still the title has passed to the other party. The learned counsel for the respondents has, however, contended that according to the statement of the attorney of the defendant, Ghulam Abbas, while appearing as D.W.4, the entire amount of consideration stood paid and the possession was also taken over by the respondents. This, in my view, would not advance the case of the respondents, for, the fact remains, that it is only when the deed or sale is executed that the title passes from the vendor to the vendee. Apart from the above, there is no evidence on the record to show that the vendee has received sale price or that he had in pursuance to the decree or otherwise either orally or by some writing transferred the title to the vendee. I am not impressed by the arguments of the learned counsel for the respondents that if the suit is not held to be competent it will tantamount to defeating the right of pre-emption. The only consequence of the view which I have taken is that the suit 1 at this stage will be premature but the execution of the sale-deed in pursuance to the decree, the transaction can be pre-empted by filing appropriate proceedings. I, therefore, hold that there was no sale in favour of the appellant which could be pre-empted by the respondents.
11. The next grievance of the learned counsel for the appellants that the Additional District Judge has erred in excluding the area of 81 Kanals 15 Marlas of land while passing a decree and proportionately reducing the price from Rs.2,10,000 to Rs.1,57,500, is well-founded in law a pre- emptor is bound to take the transaction as a whole and cannot be allowed to plead want of title, in the vendee or any defect therein nor can he seek to exclude any part of the transaction or refuse to pay the entire price which had been paid by the vendee to the vendor. Reference in t his connection may be made with advantage to the two authorities of the Supreme Court namely, Ghulam Muhammad and 3 others v Khushi Muhammad and another PLD 1973 SC 444 and Malik Hussain and others v. Lala Ram Chand and others PLD 1970 SC 299 wherein it was held that the pre- emptor cannot be permitted to plead defect or want of title and the pre--emptor must take the whole bargin. In these circumstances the suit should, if at all, have been decreed on the payment of the entire price of consideration with respect to 334 Kanals and 8 Marlas and not 252 KanaIs 13 Marlas.
12. Reverting to the last contention of the learned counsel for the appellants that the suit was bad for partial pre-emption, I find it to be without any force. In the plaint the plaintiff had specifically asserted that the decree with respect to the entire area of land sold namely 334 Kanals 8 Marlas be passed on the payment o1 Rs.2,10,000 are such other price as may be determined. It is correct that in the alternative, the plaintiff on the basis of want of title in the respondents Witt respect to 81 Kanals 15 Marlas of land, stated that in case the Court comes to the conclusion that the decree can be passed only to the extent of remaining land the needful may be done after proportionately reducing the price. However, the assertion in the alternative, would not make the suit bad for partial pre-emption inasmuch as the respondents in their plaint in no uncertain terms prayed for decree with respect to the total land specified in paragraph 1 of the plaint. For the foregoing reasons, this appeal is accepted, the judgment an decree of the Additional District Judge is set aside and that of the trial Courtrestored. No order as to costs.