' SHAFIUR RAHMAN, J.--Leave to appeal was granted to the plaintiff/pre-emptor to examine whether the power conferred by section 22 of the Punjab Pre-emption Act of calling upon the pre-emptor to deposit 1/5th of the A pre-emption money and extending time for making such deposit can be exercised without notice to the defendants at a stage when the defendants had not been served in the suit.
2. Mst. Ghulam Zohra sold on 27-5-1977 through a registered sale deed, the land measuring 228 kanals 2 marlas situate in Chak No, 577/EB, Tehsil and District Vehari, to Muhammad Shafi and others for a sum of Rs, 2,27,000. The appellant pre-empted the sale by instituting a civil suit on 27- 5-1978 claiming to B be a co-sharer in the estate. The suit was registered the same day and on the next day the Court ordered that notices should issue to the defendants for 18-7-1978 and the pre- emptor was called upon to deposit Rs, 45,400 by that date as 1/5th of the pre-emption money. On 16th of July, 1978, the plaintiff submitted an application before the Court that for various reasons disclosed in the application he was not in a position to deposit the amount in cash and was prepared to furnish security in like amount. He prayed that the order for cash deposit be altered into that of furnishing the security. On that date the Court ordered that the application should come up with the file on the date already fixed in the suit. The application came up on 18-74978.
The Court did not allow the substitution of cash deposit by security and treating the application for extension of time allowed it and ordered that the deposit in cash be made before the next date fixed which was given as 30-10-1978. It was also noted on 18-7-1978 that the defendants had not been till then served. Fresh summons were ordered to issue. There is also an application on record dated 18-10-1978 (page 83 of Paper Book) in which again the prayer of alteration in the order and its substitution by furnishing of the security was sought. It remained unattended. When the case came up on the date fixed i.e, 30th of October, 1978, the Court noticed that the 1/5th of the pre- emption money as ordered by the Court had already been deposited in Court in cash. The suit proceeded to trial. The only objection taken by the defendants on this aspect of the case in the written statement dated 20th of February, 1979 was that the 1/5th of the pre-emption money was not deposited within time in terms of the Court's order. The suit was contested on numerous other grounds and as many as twelve issues were framed in the case which it is not necessary to reproduce or examine. The controversy centers round the failure of the 'pre-emptors to deposit the 1/5th of pre-emption money as ordered.By the Court by 18-7-1978 as ordered on 28-5-1978 and the extension of the date of deposit to 30-10-1978 without hearing the defendants-respondents. The objection of the defendants-respondents that the amount was not deposited in time was not made the subject-matter of any issue and there was, therefore, no determination by the trial Court of the controversy. The suit was decreed by the trial Court on 18-1-1981.
3. An appeal was filed which ultimately came to be disposed of by the District Judge, Vehari. In the grounds of appeal before the District Judge no grievance was made against the non-framing of the issue or the absence of a decision on that point or with regard to the extension in time granted to the plaintiff/pre-emptor, for depositing the 1/5th of pre-emption money. At the argument stage, it appears, a grievance was made and the District Judge dealt with it in the following words:- "This suit was filed on 27-5-1978. On 28-5-1978 the learned trial Court ordered that zar-e-panjum be deposited by 18-7-1978. The plaintiff could not deposit zar-e-panjum by that date. On his application the period for the deposit of zar-e-panjum was extended up to 30-10-1978. He deposited zar-e-panjum before that date. Learned counsel for the appellants argues that extension in time originally fixed for the deposit of zar-e-panjum was granted without any notice to the vendees, therefore, the learned trial Court while granting extension exercised its discretion arbitrarily. No revision petition was filed against the extension order and the same has not been challenged in the grounds of appeal, therefore, the appellants have no right to argue that the extension order was illegal."
' The appeal was dismissed.
4. A Regular Second Appeal was then taken to the High Court and a specific ground 'k' as hereunder was taken:- "That the extension of time for the deposit of "Zar-e-Panjum" given by the learned trial Court is against law and is a nullity in the eyes of law."
' The High Court rejected the contentions of the appellant on mei its and upheld the findings of the two Courts below but the appeal was allowed and the case remanded recording a finding on this controversy in the following words:- "The appellants, in my view, are entitled to succeed on the third point, namely, that in making the order dated 18-7-1978 allowing the plaintiff to deposit Rs, 45,400 before 30-10-1978 without notice to the appellants and without affording them hearing, the learned trial Judge had acted illegally.
As has been seen above, the plaintiff had been directed by the learned trial Judge's order dated 28-5-1978 to deposit the 1/5th of the probable value of the land by 18-7-1978. On 16-7-1978, the plaintiff made an application saying that he had not been able to arrange the money and praying that he should be allowed to give security. Without adverting to his prayer in the application, namely, that instead of depositing the sum of Rs, 45,400 he should be allowed to give security, the learned trial Judge allowed the plaintiff to deposit the sum of Rs, 45,400 before the next date viz. 30-10-1978. In fact, the learned trial Judge assumed, and obviously wrongly assumed, that the plaintiffs application was for extension in time. This shows, therefore, that in making the order dated 18-7-1978, the learned trial Judge failed to apply his conscious mind to the question whether it was a fit case for extension in time or not. Learned counsel for the appellants argued that failure to arrange money has never been considered to be a good ground for extension in time. As I propose to remit the case to the learned trial Judge, I do not think it advisable to express an opinion on whether the reason adduced by the plaintiff was a good reason. It suffices to say that the order dated 18-7-1978 was made without notice to the appellants and without affording them hearing."
5. Ch. Khurshid Ahmad, Advocate, the learned counsel for the appellant has contended that the power of the Court to fix the time for depositing the amount and for extending the time is unqualified and a notice to the defendants is not necessary in dealing with any application of the plaintiff with regard to it at a stage when the defendants had not put in their appearance in the proceedings. The Court had considered the request of the plaintiff and while refusing substitution of cash by security and making the order on the last date which had not expired, extended the time for deposit of 1/5th of pre-emption money, and in doing so it exercised the discretion judicially, correctly and in an appropriate manner. In support of this proposition he has relied on Niaz Muhammad Khan v. Mian Fazal Raqib (PLD 1974 S.C. 134), Malik Hadayat Ullah and 2 others v. Murad Ali Khan (PLD 1972 SC 69), Ch. Zulfiqar Ali v. Mian Akhtar Islam and Mian Bashir Ahmad (PLD 1967 SC 418), Shah Wali v. Ghulam Din alias Gaman and another (PLD 1966 SC 983), Inayatullah and others v. Mst. Khurshid Akhtar (1986 SCM R 687) and Khuda Bakhsh v. Sultan Muhammad and another (1985 SCM R 192).
6. Ch. Khalilur Rahman, Senior Advocate, the learned counsel for the respondent on the other hand contended that the order passed by the trial Court was not only without notice to the defendants but was misconceived on facts and uncalled for in the circumstances of the case. He has in support of the proposition relied upon Riaz Ahmad Khan v. Faiz Muhammad Khan (PLD 1978 Baghdadul Jadid 85), Muhammad Azam Khan and another v. Ditta and others (PLD 1967 Lahore 1068), Abdul Wahid etc. v. Ibrahim etc. (PLD 1966 Baghdadul Jadid 8) and Sardar Ghulam Sarwar Khan and 2 others v. Sardar Muhammad Anwar Khan and 2 others (PLD 1971 Peshawar 170).
7. Section 22 of the Punjab Pre-emption Act, 1913, reads as hereunder:- "22. Plaintiff may be called on to make deposit or to file security.-- (1) In every suit for pre-emption the Court shall at or at any time before the settlement of issues require the plaintiff to deposit in Court such sum as does not, in the opinion of the Court, exceed one-fifth of the probable value of the land or property, or require the plaintiff to give security to the satisfaction of the Court for the payment, if required of a sum not exceeding such probable value within such time as the Court may fix in such order.
(2) In any appeal the Appellate Court may at any time exercise the powers conferred on a Court under subsection (1).
(3) Every sum deposited or secured under subsection (1) or (2) shall be available for the discharge of costs.
(4) If the plaintiff fails within the time fixed by the Court or within such further time as the Court may allow to make the deposit or furnish the security mentioned in subsection (1) or (2), his plaint shall be rejected or his appeal dismissed as the case may be.
(5) (a) If any sum so deposited is withdrawn by the plaintiff, the suit or appeal shall be dismissed.
(b) If any security so furnished for any case becomes void or insufficient, the Court shall order the plaintiff to furnish fresh security, as the case may be, within a time to be fixed by the Court, and if the plaintiff fails to comply with such order, the suit or appeal shall be dismissed.
(6) The estimate of the probable value made for the purpose of sub-section (1) shall not affect any decision subsequently come to as to what is the market value of the land or property."
8. It is not contested by the learned counsel for the respondent. And rightly so, that while making the first order of deposit the defendants were not required to be given notice or served. In altering that date or granting an extension, a right is claimed because it is said it allows a benefit to the plaintiff and may work to the disadvantage of the defendants-respondents. An examination of section 22 of the Punjab Pre-emption Act makes it clears tht the provision deals with a power of the Court and relates to the procedure in pre-emption cases. In passing the first order and in making alterations in it, no vested right of the respondents-defendants comes into conflict. It was a judicial power the benefit of which was claimed by one of the parties at a stage when the other party had not put in appearance and was neither present nor participating in the proceedings. Undoubtedly a vested right of the defendants-respondents will arise where noncompliance of the order takes place and the penal provisions take over. In that circumstance and at that stage the question whether the plaintiff should be relieved of the penalty is undoubtedly within the power of the Court and the defendants can claim a right to be heard and contest because their vested right comes into existence. This right, however, cannot be extended to a stage when the plaintiff has incurred no, penalty, has committed no default or disobedience and is only claiming the exercise of power to his benefit without directly prejudicing the interest of the defendants-respondents. The vested right of the defendants-respondents would arise only after default, disobedience, non-compliance with the order when the result laid down in section 22 (4) of the Pre-emption Act will follow.
9. There is another aspect of the case, if a hearing at that stage be made necessary then the entire proceedings will get frustrated. Such an application made a few days earlier to the date fixed will necessarily go beyond the date fixed if notices are made mandatory and the forfeiture or default will automatically take place pending that application and new juristic relationship in the form of rights and liabilities will arise. This legal question was considered in the context of N.-W.F.P. Law of Pre-emption similar in language and effect in a decision given E on 28th October, 1959 but reported in 1985 SCMR at page 192. In that case on 28th of December, 1953 an order about deposit of Rs, 1,000 before 14-1-1954 was passed. The plaintiff by an application dated 11-1-1954 sought that the order be altered and security be substituted. It was ordered to come up on the date fixed which was 14-1- 1954 when the application was rejected but nevertheless the time for deposit of the cash amount was extended up to 30-1-1954. The Judicial Commissioner in Revision set aside the order of the trial Court extending the time after rejecting the application on the ground that the extension had been granted without any good and sufficient reason in favour of the pre-emptor whose conduct had been mala fide. The Supreme Court allowed the appeal observing as hereunder:-- "After hearing counsel on both sides we are of the opinion that the view taken by the learned Judicial Commissioner is unsustainable. Under section 23, subsection (4) it is for the Court to extend time for the deposit of the pre-emption money and that provision contains no indication whatsoever of the grounds on which time may or may not be extended. The discretion of the trial Court is, therefore, absolute and is not restricted by any statutory considerations. We are unable to accept the contention of the learned counsel for the respondent that the extension cannot extend beyond the last date for the institution of the suit and that a Court acts illegally or with material irregularity if the time for the deposit is extended beyond the period of limitation for the suit. In the present case, the appellant prayed for a revision of the order of deposit 3 days before the date by which the deposit could have been made. If the Court had rejected this application on that very day the plaintiff still had 3 days within which to make the deposit. The Court, however, extended the time to 30th January and ordered the plaintiff to pay Rs, 30 as damages. There was, therefore, no irregularity on the ground of which the Judicial Commissioner could have interfered in revision. It was obviously not a case of lack of jurisdiction in the trial Court as the learned Judicial Commissioner seems to think and there was no illegality or material irregularity in the procedure adopted. Nor are we able to accept the finding in revision that the plaintiff's conduct in not depositing the amount within the time originally fixed and in asking for a review of that order was mala fide."
10. In the case of Malik Hadayat Ullah the plaintiff pre-emptor was directed to deposit Rs, 1,400 in cash by 6-1-1968 on 5-12-1967 and application was filed for furnishing security. The application was ordered by the Court to come up alongwith the case on the date fixed. On 6-1-1968 the application for alteration of the order was rejected but the Court suo motu extended the time for deposit upto 6-2-1968. The matter was brought to the Supreme Court because the High Court felt that the Court had no jurisdiction to suo-motu extend the time after rejecting the application and without notice to the other side. The Supreme Court brought out two points in the judgment to interfere with the order of the High Court. As regards the power, the Court observed as hereunder:-- "The Punjab Pre-emption Act does not prescribe any procedure for obtaining such extension of time but upon general principles a Court has normally to be moved by an application of some kind, either oral or written. This does not, however, mean that the Court has no jurisdiction, in the absence of any such application, to grant a discretionary relief where the justice of the case so requires. In the absence of any provision in the Statute or in the rules made under the Statute expressly providing that the Court shall act on the application of a party it cannot be said that such an application is a condition precedent to the exercise of the power. The power does not become nugatory, if no application is made for invoking that power. If the Court could-- we are clearly of opinion that it could under subsection (4) of section 22-- extend time, then it could do so either on the application, written or oral, of a party or even suo motu where the justice of the cause so demanded."
' The second aspect of the decision relates to the act of the Court in postponing the decision on such an application to the last day and rejecting the prayer then. It was dealt with as hereunder:-- "In the present case, the learned Judge of the High Court thought that there was no ground at all for granting such an extension although it was argued before him that in the present case the Court had made it practically impossible for the appellants who were plaintiffs in the preemption suit, to comply with the order for making the deposit within the time originally fixed by the Court by its own action, namely, the adjournment of the application for furnishing security instead of making the deposit in cash from the 6th of December, 1967, to the 6th of January, 1968, on which date the pre-emption suit itself was fixed for hearing. If the Court had not done so but had disposed of the application soon after it was filed the present difficulty would not have arisen. The pre-emptors would have had sufficient time to make the deposit in cash."
11. The High Court in the impugned judgment and earlier in the case of Riaz Ahmad Khan relied upon the decision of this Court in the case of Niaz Muhammad Khan. That case has no relevance because there the plaintiff had definitely not complied with the order, had incurred the penalty and a right had come to vest in the defendant. It was held that the plaintiff could not be relieved of the consequences of his omission by implication in the absence of an express order and without notice to the defendants-respondents.
12. The conclusion at which we have arrived is that no notice to the defendants is necessary in fixing the date for deposit or for extension of date or substitution of order of deposit, where the defendants have not been served and have not put in appearance in the proceedings. If the defendants have been served and are present and participating in the proceedings, then they have to be served with a notice not because any vested right accrues to them but because as parties present and participating in the proceedings they have to be associated with every procedural order passed with regard to the conduct of proceedings in the case. However, once a non-compliance of the deposit order has taken place and forfeiture or penalty has been incurred by the plaintiff, a vested right comes to accrue to the defendants and without notice to them the plaintiff cannot be relieved and even if relieved it must be subject to their objections and rights.
13. The learned counsel for the respondents has taken us through the order, the circumstances in which it was passed. It is urged by him that it is not a judicial exercise of discretion. It contains no reason. It was treated as a request for extension of time when in fact the application was for alteration of the order and substitution of security for cash deposit. We have attended to this aspect of the case and find no fault with the order except that it is laconic as most of these orders are. The application was clearly for alteration in the order and its substitution by another. It was refused by the trial Court and while refusing on the last date fixed for deposit of the cash amount, the date was extended and this the trial Court could do. This was done after the learned counsel for the plaintiff who was present had been heard. A discretion possessed was exercised and rightly so because by postponing the decision to the last date and then confronting the plaintiff with no alternative would have been unreasonable and oppressive.
14. This appeal is allowed with costs. The judgment of the High Court is set aside and that of the two Courts below is restored.