1. NASIM HASAN SHAH, ACTG. C J.---This appeal, by leave of this Court, is directed against the judgment of a learned Single Judge of the Lahore High Court, Multan Bench, dated 23-11-1982 passed in Civil Revision No.577/D of 1982.
2. The relevant facts are that the appellant purchased the land in dispute, of which earlier he was the tenant, on 12-9-1971. The sale gave rise to two pre--emption suits; one was filed by respondent (Bashir Ahmad, respondent herein) and the other by Iqbal Ahmad Khan who later did not pursue the matter in higher forum and is now no longer in the picture. The respondent's suit was instituted on 12-9-1972. It was decreed by the trial Court and this judgment and decree was upheld by the District Judge, Muzaffargarh in appeal and by the High Court in revision. Hence this appeal, by leave of this Court.
3. Admittedly, the appellant was a tenant in the land in dispute at the time of sale namely 12-9-1971 which sale was challenged by Bashir Ahmad, respondent, by filing a suit on 12-9-1972. The learned Courts below decreed the suit of Bashir Ahmad on the ground that under the Land Reforms Regulation 1972 the superior right of pre-emption of a tenant has been acknowledged as from Kharif 1972 namely from 15th June, 1972 only. Since the impugned sale transaction took place on 12- 9-1971 when he did not possess the superior right of pre-emption and this sale was questioned by the pre-emption suit filed on 12-9-1972 when he was no longer a tenant and had become an owner, the pre--emptor could succeed. The appellant had resisted the suit on the ground that at the date when the suit was instituted he had improved his status Since he had been the tenant over the suit land right upto the sale transaction continuously since 1969. The case of Bashir Ahmad respondent, however, was that since according to the entry in the khasra girdawari the appellant was shorn as a full owner of the land in Kharif 1972, having purchased the land in September, 1971, his tenancy had been converted into ownership by Kharif 1972. This plea was upheld and it was ruled that in so far as the appellant was no more g tenant of the suit land in Kharif 1972 his tenancy having been converted into ownership; he could not avail the benefit of the Land Reforms Regulation, 1972, in so far as the first right of the pre-emption in respect of the land comprised in tenancy was conferred on a tenant as from Kharif 1972 [section 25(3)(d)] and pot earlier.
4. Accordingly, the appellant not being a tenant at the date of the institution of the suit whereas the respondent was a collateral of the vendor and had a superior right of pre-emption, his pre- emption suit was entitled to succeed.
5. After having given my earnest consideration to the facts of this case and the law applicable thereto I have arrived at the conclusion that the tent's plea was entitled to be accepted.
6. Now if the sale had taken place on any date after pith June, 1972, but before 12-9-1972, when the respondent's suit was filed, it is not seriously contested that the tenant could have successfully resisted the suit despite the fact that the tenant had become owner on account of purchase of the land comprised in his tenancy, earlier to the filing of the suit. This position is not conceded on account of the improvement of the vendee-tenant's position by virtue of the position of clause (d) of subsection (3) of section 25 of the Regulation, 'Vesting the tenant with the first right of pre- emption in respect of the land comprised in the tenancy and putting him in the superior-most category of pre-emptors as from Kharif 1972. If this be so, then, in my humble view, the situation is not altered only because the impugned sale took place on 12-9-1971 earlier to the date of the enhancement in the status of the tenant which was enhanced as from Lharif 1972 i.e. As from 15th June, 1972 by the Land Reforms Regulation. This, in my opinion, is so because on the date the suit was filed on (on 12-9-1972) the status of the tenant already stood enhanced and he could take advantage of the provisions of section 21-A of the Punjab Pre-emption Act, 1913. According to this section while a pre-emptor cannot defeat a vendee by improving his status after the sale and before the institution of a suit, no such bar exists to a vendee improving his status after the sale but before the suit for pre-emption is instituted. Thus, if a vendee --defendant improves his status after the date of the sale but before the institution of the suit he can rely on his improved status to defeat the suit of the pre-emptor.
7. This Court in Muhammad Khan v. Muzaffar (PLD 1983 S (A181) held that if a vendor sells the land to a tenant, the superior right confer) on the latter under Article 25 of the Land Reforms Regulation cannot be defeated on the ground that by the very same sale the rights of tenancy ceased to exist and, therefore, the tenant lost the superior rights conferred under the latter provision. MA. Zullah. J.
8. (as His Lordship then was) speaking for the Bench said:---- "It is not denied that before the sale the defendant was a `tenant' and qua him the plaintiffs had no preferential claim. This situation continued up to the time when the sale was to take place; because at the time of and during the sale, the defendant remained a tenant. Even if for the sake of argument it is assumed that after the completion of sale in every respect, the tenancy rights merged into ownership rights, that would in no way clothe the plaintiffs with superior right. The possibility of contemporaneous acquisition of superior right during the process of sale is too philosophical to be given any importance for the purpose of interpreting para. 25(3)(d)."
9. However, another Bench of this Court in Fazal Khan v. Ghulam Rabbani (PLD 1983 SC 265) took a slightly different view. In that case the sale in favour of the tenant of the land comprised in the tenancy was made on 12-7-1971 i.e. Before the coming into force of the Land Reforms Regulation, 1972. The suit for, pre-emption was filed on 2-7-1972. The vendee resisted the suit pleading that at time of sale, they being tenants of the suit land, had improved their status by virtue of the superior right of pre-emption created under Article 25 of the Land Reforms Regulation. This plea was not accepted and it was held that the question of improvement of status did not arise in this case because the vendee's rights as tenant after the sale got extinguished by merger of such rights into ownership rights and this occurred prior to enhancement of the Land Reforms Regulation.
10. Accordingly, he could not claim any right as tenant so as to be vested with a superior right of pre- emption created under para. 25(3)(d) of the Regulation.
11. The earlier decision in the case of Muhammad Khan v. Muzaffar ( PLD 1983 SC 181) was distinguished and it was observed that in the aforesaid case "this Court has held that if, a vendor sells the land to a tenant the superior right conferred on the latter under Article 25 of the Land Reforms Regulation cannot be defeated on the ground that by the very same sale the rights of tenancy ceased to exist and, therefore, the tenant lost the superior rights conferred under the latter provision. If on the date of the sale the tenant has preferential right of pre--emption over all rights of pre-emption under section 15 of the Punjab Pre--emption Act, the vendor would be complying with the dictates of the general law of pre-emption in accepting the offer of a would-be pre- emptor and selling the land to him".
12. The view taken in the above case appears to be that the vendee tenant can assert a superior right of re-emption only if he was already clothed with the improved status under the provisions of clause (d) of subsection (3) of section 25 of the Regulation at the time of sale which was acquired by him on or after 15th June, 1972 and as the sale in this case had taken place on 2nd July, 1971 before acquisition of the improved status, the provisions of section 25(3)(d) of the Regulation were of no avail to him.
13. In my opinion, this does not appear to be a proper appreciation of the rule laid down in the precedent case of Muhammad Khan (PLD 1983 SC 181). In the first place it omits from consideration the provisions of section 21-A of the Pre-emption Act, 1913. Secondly, full effect is not given therein to the principle that a pre-emptor to succeed should have superior right at the time of sale, at the time of suit and at the time of decree. In the case in hand although the pre--emptor had a preferential claim at the time of the sale viz. 12-9-1971 but before the suit was instituted by him (on 2-7-1972), the tenant became vested with a superior right (as from 15th June, 1972). This improvement was not given consideration on the view that the tenancy rights got extinguished on account of the sale as they got merged with ownership rights. However, it was overlooked that it Is the attempt to obtain ownership rights by purchase of the land in question that the pre-emption suit was occasioned which challenge could be defeated by virtue of the provision of section 25(3)
(d) by the tenant/owner, as under the said provision the first right of pre-emption was conferred on him. Indeed, it is only when the sale made in favour of the tenant is challenged, which sale in his favour results in his becoming an owner, that the occasion to press into service and to rely on his improved status that has been conferred on him under the provisions of section 25(3)(d) of the Regulation comes into play. To hold that the rights conferred on tenants get extinguished by the sale in his favour so as to deprive him the possibility of relying on them to defeat the challenge to his newly acquired rights of ownership in the tenancy would make the rights conferred by section 25(3)(d) on him quite meaningless. Any such interpretation would be to nullify the full amplitude of the legislative intent namely to enable the tenant, inter alia, to defend the sale from the attack of a pre-emptor, claiming superior pre-emptive right. The effect of true view taken in the case of Fazal Khan (PLD 1983 SC 285) would be that a tenant would be able to avail of his superior pre-- emptive rights only in suits for pre-emption filed by him in respect of the sale made of the land comprised in the tenancy to others but he could not avail of them in defending a suit of pre- emption whereby the sale thereof made in his favour is impugned. I do not think that this view is correct and a close scrutiny of the judgment delivered in Muhammad Khan's case (PLD 1983 SC 181) supports the view expressed above and also lays down the same principle. I am, therefore, inclined to follow the ratio of the said decision in letter and spirit.
14. The result is that I would accept this appeal, set aside the judgments of the Courts below and dismiss the suit of the pre-emptor, Bashir Ahmad (respondent herein). I would, however, leave the parties to bear their own costs.