1. AN WARUL HAQ, J.-This appeal, by leave of the Court, has arisen .Out of the summary dismissal by a Division Bench of the former High Court of West Pakistan, at Lahore, of a Constitution Petition, instituted by the appellant in respect of 5711 acres of agricultural land situate in Leiah Tehsil of the Muzaffargarh District.
2. On the 7th of February 1959, the West Pakistan Land Reforms Regulation (Martial Law Regulation No. 64) was promulgated and accordingly it became necessary for the Corporation to consider whether it could hold the area of land transferred to it by the Authority. On the 20th of December 1959, the Corporation adopted a resolution authorising the Board of Directors to "transfer the possession of the land belonging to the That Development Authority under the provisions of the Martial Law Regulation No. 64 to the Thal Development Authority against payment of that part of sum of Rs. 17,90,765 which represents the price and development charges of that land to the Corporation", and to dispose of the remaining land by distributing it among those shareholders of the Corporation who are affected by the Land Reforms in proportion to the shares held by them, provided they agreed to pay a sum of Rs. 17-14-6 per share, being the price of the one-half kanal of land corresponding to each share. The land falling to the share of those shareholders who were not affected by the Land Reforms was to be sold by the Corporation by public auction. The scheme incorporated in this resolution was laid before the Company Judge of the High Court who sanctioned the same on 2-5-196(Y under section 153 of the Companies Act, adding that it shall be given effect to except in so far as it may be repugnant to Martial Law Regulation No. 64. He further directed that formal sanction of the Land Commission be obtained to implement the resolution. On the matter being referred to the Land Commission, the latter ruled as follows on the 25th of October --1962 "That the object of paragraph 12 of Martial Law Regulation No. 64-- was that the share relating to land held by a declarant land-owner should also be taken into account for purposes of determination of holdings in accordance with the procedure laid down in the aforesaid paragraph and that the Land Commission was not concerned with the disputes arising between the shareholders, except that no alienation and partition of land could take place in contravention of paragraphs 23 and 25 of the said Regulation."
3. The authority took possession of 4763 acres of land, ostensibly in implementation of the resolution adopted by the Corporation on the 20th of December 1959, leaving a balance of 948 acres for distribution among the other shareholders. It is a common ground that the amount stipulated in the resolution, namely, Rs. 17,90,765, has not been paid by the Authority to the Corporation. The remaining holding of the Corporation was not distributed among the shareholders as contemplated by the resolution and the scheme based on it.
4. It was, in these circumstances, that the appellant, Muhammad Ibrahim Siddiqui, since deceased and represented by his legal representatives, invoked the jurisdiction of the High Court, in his capacity as a shareholder of the Corporation, contending that under paragraph 12 of the Martial Law Regulation, the Authority, although a shareholder of the Corporation, was debarred from taking any share in the land as it was a body incorporate, and accordingly the entire holding had thus vested in the other share--holders of the Corporation, to the exclusion of the Authority. He prayed inter alia, for a declaration that the proceedings taken by the Authority and the Corporation in retaining and dealing with the land in derogation of the resolution of the Corporation, were without lawful authority and of no legal effect. He also prayed for a writ or direction for the distribution of the land, or its sale proceeds, among the shareholders other than the Authority.
5. As already stated, the writ petition was dismissed by a Division Bench of the High Court by its order dated the 27th of May 1965; holding that the matter was not governed by sub-paras. (1) and (2) of paragraph 12 of Martial Law Regulation No. 64 as these provisions dealt with the acquisition of shares in lieu of land by a person as defined in clause 8, paragraph 2 of the Regulation which definition excluded a local authority or a body incorporated by a Central or Provincial Act. The, learned Judges further observed that sub-para. (2) was in the nature of ~ a con--sequential provision to sub-paragraph (1) and did not operate independently. They found that there was no provision in the Martial Law Regulation concerned prohibiting a company from holding agricultural land.
6. It is submitted by Sh. Abdul Haque, the learned counsel for the appellant, that the High Court has erred in interpreting paragraph 12 of the Regulation and holding that the matter was not at all governed by sub-para. (1) or sub-para. (2) thereof. He contends that even if sub-para...(1) did not apply, then under sub-para. (2), as well as the Resolution of the Corporation dated the 20th of December 1959, the land in dispute had to be distributed among the shareholders other than the Authority. He further contends that in any case, the High Court should have given -a direction to the Authority to restore to the Corporation - the land which the Authority had grabbed illegally and without payment of the amount of compensation determined by the Corporation.
7. On behalf of the respondents, Mr. S. M. Zafar has raised a preliminary objection to the effect that the writ petition was not competent for the reason that the Corporation was not a person within the meaning of that term as defined in Article 98 of the 1962 Constitution, under which the petition was filed on the 3rd of January 1965. The learned counsel submits that a writ cannot issue to a limited company incorporated under the Companies Act. whether a writ can issue to a limited company.
8. Paragraph 12 of Martial Law Regulation No. 64 is in the following terms : "12. Bodies corporate.-(1) Where any person had, before the com--mencement of this Regulation, acquired any shares in any company within the meaning of the Companies Act, 1913 (VII of 1913), or in any Co-operative Society registered under the Co-operative Societies Act, 1912 (XII of 1912), or under any other law for the time being in force by transferring to such company or society any land or if acquisition of shares by him in such company or society is otherwise wholly or partly relatable to such transfer of land, then the shares so acquired or relatable, together with any unpaid interest or profit accrued thereon, shall, on such commencement, vest in the company or society, as the case may be, and the land shall revert to that person, As already stated, the writ petition was dismissed by a Division Bench of the High Court by its order dated the 27th of May. 1965; holding that the matter -was not governed by sub-paras. (1) and (2) of paragraph 12 -of Martial Law Regulation No. 64 as these provisions dealt with the acquisition of shares in lieu of land by a person as defined in clause 8, paragraph 2 of the Regulation which definition excluded a local authority or a body incorporated by a Central or Provincial Act. The' learned Judges further observed that sub-para. (2) was in the nature of a con--sequential provision to sub-paragraph (1) and did not operate independently. -They found that there was no provision in the Martial Law Regulation concerned prohibiting a company from holding agricultural land.
9. It is submitted by Sh. Abdul Haque, the learned counsel for the appellant, that the High Court has erred in interpreting paragraph 12 of the Regulation and holding that the matter was not at all governed by sub-para. (1) or sub-para. (2) thereof. He contends that even if sub-para._(1) did not apply, then under sub-para. (2), as well as the Resolution of the Corporation dated the 20th of December 1959, the land in dispute had to be distributed among the shareholders other than the Authority. He further contends that in any case, the High Court should have given a --direction to the Authority to restore to the Corporation the land which the Authority had grabbed illegally and without payment of the amount of compensation determined by the Corporation.
10. On behalf of the respondents, Mr. S. M. Zafar has raised a preliminary objection to the effect that the writ petition was not competent for the reason that the Corporation was not a person within the meaning of that term as defined in Article 98 of the 1962 Constitution, under which the petition was filed on the 3rd of January 1965. The learned counsel submits that a writ cannot issue to a limited,; company incorporated under the Companies Act. examine the question whether a writ can issue to a limited company.
11. Paragraph 12 of Martial Law Regulation No. 64 is in the following terms: "12. Bodies corporate.--(1) Where any person had, before the com--mencement of this Regulation, acquired any shares in any company within the meaning of the Companies Act, 1913 (VII of 1913), or in any Co-operative Society registered under the Co-operative Societies Act, 1912 (XII of 1912), or under any other law for the time being in force by transferring to such company or society any land or if acquisition of shares by him in such company pr society is otherwise wholly or partly relatable to such transfer of land,-- then the shares so acquired or relatable, together with any unpaid interest or profit accrued thereon, shall, on such commencement, . Vest in the company or society, as the case may be, and the land shall revert to that person, company. The land only notionally vests in them for the purposes of the Regulation.
12. This distinction between the two categories becomes further clear by~ reference to sub-para. (3) of paragraph 12 which speaks of land which has reverted under sub-paragraph (1) and of the share of land as determined under sub-para. (2), and then proceeds to indicate the manner in which these lands are to be dealt with for the purposes of the Regulation.
13. It will, therefore, be seen that the disposal of the land in dispute I this case was to be regulated in accordance with sub-para. (2) of para--graph 12 of the Regulation. There was no question of the land reverting to the Thal Development Authority, nor of being actually and physically distributed or handed over to the several shareholders of the Corporation. C All that was required was that, for the purposes of the Regulation, the land was to cease to be owned or possessed by the Corporation, and was to be deemed to be owned or possessed by the individual shareholders in proportion to the paid-up value of their shares. The resolution adopted by the Corporation on the 20th of December 1959, therefore, proceeded on a misconception of the true import of paragraph 12 of the Regulation. The Thal Development Authority had no right to take over any portion of the land, nor were the other shareholders entitled to any such benefit.
14. It is interesting to observe that in paragraph 142 of Volume I of the Book entitled Land Reforms in West Pakistan, compiled by Malik Khuda Bakhsh, Secretary, West Pakistan Land Commission, the, question of the disposal of this very land has been specifically discussed by the learned author in the following terms :- "142. The Chairman, Thal Development Authority considered that the farm owned by the Thal Industries Corporation would have to be fragmented and that each shareholder would be entitled to a little less than half a kanal of land for each fully paid-up share owned by him which could not have been the intention of the Land Reforms Commission. The matter was placed before the Land Commission and it was affirmed that the word "person" did not include a local authority or a body incorporated by a Central or Provincial Act and the That Development Authority was not a person within the meaning of paragraph 12 of the Regulation. The Chairman of the Thal Development Authority was, therefore, informed that the land held by the Thal Industries Corporation would not revert to the Thal Development Authority and there was no intention to fragment the area held by the Thal Industries Corporation or to allow any one to take its physical possession. All that was intended was that in case of any company or society owning or possessing land, which did not revert under sub-paragraph (1) of paragraph 12, such land should for the purposes of the Regulation be deemed to be owned or possessed not by the Company or society but separately and individually by its shareholders, which under sub-paragraph 3 ibid should be added to other land held by the shareholder."
15. The conclusion reached in this paragraph is in conformity with the provisions of paragraph 12 of the Regulation.
16. At this juncture, it will not be out of place to mention that the claim put forward by the appellant for the actual physical distribution of the entire holding of the Corporation among its shareholders, other than the Authority, is not supported by the resolution on which the appellant has placed reliance. That resolution clearly contemplated that the proportionate share of the land had to go to the Authority, and only the remaining area had to be distributed among the other shareholders. Of course, the resolution omitted to take note of the fact that the proposed fragmentation would be hit by the provisions contained in paragraphs 23 and 25 of the Martial Law Regulation.
17. For the foregoing reasons, we are of the view that while the appellant before us, and other shareholders of the Corporation, are not entitled to obtain a pro rata distribution of the land held by the Corporation, yet the appellant is certainly entitled to a declaration that the transfer of the land in dispute to the Thal Development Authority was without lawful authority and of no legal effect. The Authority must, therefore, restore the same to the Corporation.
18. Mr. War, the learned counsel for the respondents, submitted that by a Notification issued by the Provincial Government on the 31st of May 1969, under section 81 of the Thal Development Act, 1949, the Thal Development Authority stands dissolved and its duties and functions have been entrusted to an Administrator. The learned counsel further stated that the land taken over by the Authority had since been distributed and disposed of in favour of a large number of allottees and others, and it will be impossible for the Authority or the Administrator, to restore this land to the Corporation. The Administrator would however, be prepared to compensate the Corporation on a basis to be mutually agreed upon.
19. As the matters mentioned by Mr. Zafar do not require any adjudication in the present proceedings, we need not offer any comments thereon. These are matters which must be sorted out between the Authority and the Corporation. The present appeal is accepted to the extent that a declaration is granted to the appellant to the effect that the transfer of 4763 acres of land in dispute to the Thal Development Authority was without lawful authority and of no legal effect. The appeal is dismissed in regard to the other prayers contained in the writ petition. . In the circumstances, the parties are left to bear their own costs.