KHALIL-UR-REHMAN KHAN, J. The facts necessary for appreciating the grievance made in this petition as gathered from the petition as well as from the two feds produced by the learned counsel for the Board of Revenue, briefly stated are that in 1915 one Col.E.H. Cole, Mrs, Cole and Miss Cole were leased out crown land measuring 7778 acres 6 kanals and 13 marlas (approximately 311 squares) situated in Tehsil Okara, then District Montgomery, on Horse Breeding Conditions for a period of 20 years. In 1922 Col. Cole applied for the transfer of the tenancy in question to a private Company named Coleyana Estate Limited, which was allowed by the Commissioner, Multan Division, Multan with the concurrence of the Governor in Council. On expiry of the lease in 1936 the same was renewed for a further period of ten years with effect from 15.10.1936 on the conditions published in the Punjab Gazette Notification No.762-C dated 25.2.1936. After the expiry of this term the lease was again renewed for a further period of. Ten years thus the lease was due to expire on 14.10.1956.
2. In 1952 and 1954 the Managing Director, Coleyana Estate Limited was issued two successive warnings by the Ministry of Defence in respect of the unsatisfactory conditions of animals in the estate, which was again inspected for the third time by a representative of the Ministry of Defence and it was found that there was no improvement by the Managing Authorities and the animals were still in a deplorable condition. The Ministry of Defence, therefore, recommended for the termination of the lease with immediate effect. The Collector, Montgomery, took necessary steps for the termination of lease. The matter was referred to the Arbitrator in accordance with the terms of the lease.
3. This reference was still pending when Nawab Sir Muhammad Mehar Shah, the Managing Director, Coleyana Estate Limited, on 3.6.1955 informed the Army Authorities that the Company was willing to surrender the lease. The Secretary (Colonies) Board of Revenue, West Pakistan, Lahore, was informed vide registered letter dated 19.11.1955 that the Coleyana Estate Limited Company has come under voluntary liquidation regarding which a resolution was passed by the shareholders in the general meeting on 16.11.1955 and that as the Company has come under liquidation the lease is automatically surrendered. The Defence Department was also asked to allow the liquidator to dispose of the horses etc.
4. The Secretary to the Government of West Pakistan, Revenue Dapartement, Lahore, vide Memo.
No. COL-5/1-56 dated 8.5.1956 wrote to the Deputy Secretary, Board of Revenue, West Pakistan, Lahore, that the area measuring 7778 acres 6 kanals 13 marlas situated in Okara, Tehsil of Montgomery formally leased out to the Firm known as Coleyana Estate Limited till 15.10.1956 stands resumed to the Government of West Pakistan and their lease stands terminated with effect from 16.11.1955 as the Firm voluntarily resolved to liquidate the Company and to surrender the area. The direction was thus passed to take over the land surrendered by the above Company.
5. From this stage onwards two questions were raised; (i) the manner in which the surrendered land is to be utilized, and (ii) the compensation payable under the terms of the lease. As regards the disposal of the surrendered land the Government of Pakistan, Ministry of Defence, Army Branch, Rawalpindi, vide its Memo. No.580-426-REM/1799-A/D-3 dated 10.7.1956, in reply to endorsement No.Col-5/I/56 dated 2.6.1956 of the Secretary to the Government of West Pakistan, Board of Revenue, (Colonics) Lahore, stated that the Ministry has selected the following applicants 26 in number for allotment of Okara Horse Breeding Studs previously known as Coleyana Estate Limited in 26 lots. The surrendered land so divided into 26 lots was then allotted to various grantees including Nawab Sir Muhammad Mehar Shah.
6. With regard to the question of compensation, the other relevant facts are that Nawab Sir Muhammad Mehar Shah, predecessor-in-interest of the petitioner, was a share-holder as will as the Managing Director of the Company, who on voluntary winding up purchased the assets of the Company by paying further Rs.40,000.00. He thus having acquired all the assets and interest of the Company submitted claim for compensation for the trees and the buildings standing on the land in question, which mainly constituted the assets of the Company. The claim of compensation was processed by the authorities and vide Memo, dated 9.1.1958 (Annexure 'B') the Settlement Officer/Collector, Montgomery forwarded to the Commissioner, Multan Division, Multan for onward transmission to the Board of Revenue the revised assessment of Compensation as made by the Executive Engineer, P.W.D., B.&R. Montgomery. The revised assessment was to the extent of Rs.4,41,100/- for buildings against the previous assessment figure of Rs.305330.00. The Forest Department assessed the price of standing Urees at Rs.17453.00. The Secretary (Colonies) Board of Revenue Punjab vide Memo. No.295-71/1601-CLL dated 1.6.1971 requested the Section Officer, Government of Pakistan, Ministry of Defence, Army Branch, Rawalpindi, to obtain the orders from the Ministry in respect of the compensation for buildings and trees of ex-Colcyana Estate Limited payable to Nawab Sir Muhammad Mehar Shah. In this Memo, it was stated that the Deputy Commissioner, Sahiwal, in pursuance of condition No.20 of the terms and conditions had worked out compensation of Rs.4,41,103.00 in 1959 as per details given thereunder and that the amount of compensation mentioned above worked out in 1959 would appear to be on the low side as compared to the present market value. It appears that .The matter of payment of compensation remained in correspondence between the Board of Revenue and Government of Pakistan, Ministry of Defence when ultimately Nawab Sir Muhammad Mehar Shah served legal notice dated 10.2.1980 on the Government of Punjab through Secretary (Colonies) Board of Revenue, Lahore, demanding payment of Rs.26,44,268.00 as compensation on account of principal amount payable (Rs.4,57,565/-) as well as interest accruing thereon.
7. The Secretary (Colonies) Government of Punjab forwarded a copy of the legal Notice to the Deputy Commissioner vide Memo. Dated 24.3.1980, which was replied to by the Deputy Commissioner vide Memo, dated 8.5.1980. The Secretary (Colonies) then vide Mcmo. Dated 1.12.1980 wrote to the Deputy Commissioner, Sahiwal that in view of the facts reported in your Memo, and that of the advice of the Solicitor, Government of Punjab, notice served on behalf of Nawab Sir Muhammad Shah, a Stud lessee, claiming compensation for buildings and trees on the land surrendered by him has no force as the same has been decided to be ignored. A copy of this Memo, was, however, not endorsed to the petitioner, who then vide letter dated 17.2.1983 requested the Member (Colonies) Board of Revenue to settle the matter of claim pending with the Department by directing to issue the cheque for the amount of compensation assessed. This letter/application was replied to vide Memo, dated 23.4.1983 saying that the petition submitted claiming compensation was considered and rejected. This was the first communication from the Government to the heirs of the late Nawab Sir Muhammad Mehar Shah. This led to the filing of the present constitution petition seeking the relief that respondents be directed to pay the compensation with interest for buildings and trees as stipulated in the lease deed on the plea that the compensation stands assessed by the competent authority i.e. The Collector but the amount of compensation is not being paid and released due to unauthorised and unwarranted objections.
8. The report and para wise comments were filed by Rana Muhammad Arshad, Additional Advocate General, in Court on 12.11.1989. In these comments after giving the above noted factual background the position taken is that on recommendation made by the Ministry of Defence 40 squares of land previously held by the Company were granted on lease in favour of Nawab Sir Muhammad Mehar Shah for ten years from 17.10.1956 to 16.10.1966. This was the best piece of land out of the entire area and that Nawab Sahib had sold most of the trees without any authority; that possession of these 40 squares of land remained with Nawab Sahib up to 16.10.1968 and thereafter 28 squares of land were withdrawn and allotted to others. The other pica taken is that according to condition No. 2 of the lease deed if the outgoing tenant does not accept the decision of the Collector or if the incoming tenant docs not require accommodation in excess of his authorization the outgoing tenant shall have to remove the building material within a period of one month failing which the entire material shall become the property of the Government. The case made out by the Collector in paragraph 11 of the report is that Nawab Sahib, the predecessor-in-interest of the petitioner, managed to gel a lease of 40 squads of the furlike area out of the entire area of 7778 acres held by the former Colcyana Estate Limited, reaped the fruits of these squares up til 1968 when he was left with only 12 squares and his son was granted lease of 8 squares while rest of the area of 20 squares was allotted to Maj. Gen. Shauka! Ali Shah and Maj. Sanaullah, that the petitioner removed food godowns and had also cut trees without any permission granted by any competent Court of law, and that he was not entitled to claim any compensation, which has been rightly rejected by the Board of Revenue and G.H.Q. Ministry of Defence, Rawalpindi.
9. Before dealing with the merits of the case it may be noted that firstly Rana Muhammad Arshad, Additional Advocate General, obtained various adjournments to get the record and to receive instructions so as to find out the real reasons on account of which the amount of the compensation was not being paid despite the assessment made by the Collector and the acceptance of the same by the Board of Revenue as is apparent from Memo, dated 1.6.1971 (Annexure 'E'). Later Mr. Irfan Qadir, Assistant Advocate General, appeared on some dates and got adjournments for the same purpose, and finally Syed Iftikhar Hussain Shah, AAG,I appeared to defend the petition and to argue the matter on behalf of the respondents.
10. The learned counsel contended that neither the petitioner, nor late Nawab Sir Muhammad Mehar Shah, his predecessor-in-interest, is entitled to claim any compensation as interest, on liquidation of the Colcyana Estate Limited, in the tenancy in question was transferred without obtaining permission under Section 19 of the Colonization of Government Lands Act 1912, that the interest of the defunct Company was purchased for a consideration of Rs.45,000,00 only and as such the petitioners can at best claim the said amount and not the amount of compensation as assessed by the Collector, and that the relief claimed in the petition cannot be granted as the suit if filed would have been dismissed as barred by time; On merits it was argued that the Army Authorities having rejected the claim vide their letter No.5804/433/REM/C/2364/D-3(b) dated 25.10.1971 no compensation is payable to Nawab Sir Muhammad Mehar Shah or to his heir, the petitioner.
11. The position taken on merits may first be dealt with. The rejection of the claim allegedly made by the Army Authorities may first be taken. The letter dated 25.10.1971 reads as under:- "I am directed to say that the case of compensation claim of Sir Mohd Mehr Shah has been confused as the compensation worked out by DC Sahiwal in 1959 has no bearing on the present case. The compensation has to be worked out for 28 squares of stud land resumed from the It of 40 squares already on lease with Sir MOhd Mehr Shah from 1956 to 1968. This lease period is governed under lease agreement Gazette Notification No.5184/63-CC dated the 6th November 1963. The land thus resumed was allotted to Maj. Gcn. Shaukal Ali Shah (12 sqrs), Major Sami Ullah (8 sqrs) and Syed Maqbool Ahmed s/o Sir Mohd Mehr Shah (8 sqrs) vide Board of Revenue letter No.2422- 69/2198~ CL-I dated the 9th July and 4806-68/2220-CL-I, dated the 1st October 1968 respectively.
2. I am further directed to refer to your letter No.2915-71/60/CL-I dated the Isl June 1971 and to say that in accordance with clause 22 of the lease agreement mentioned in para 1 above, the incoming tenant has the option to accept the buildings on the land in excess of his authorisation. The value of such buildings shall be assessed by the Collector in accordance with clause 19 of the deed, and if the outgoing tenant docs not accept the decision of the Collector or if the incoming tenant docs not require the accommodation in excess of his authorisation, the outgoing tenant shall remove the building material within a period of one month failing which the entire material shall become the property of the Government."
12. The first thing to be noted as pointed out in the aforesaid letter is that the claim of compensation for the buildings etc. As processed and assessed by the Collector, Sahiwal, in 1959 is separate and distinct from the claim of compensation made in respect of 28 squares of Stud land resumed in 1968. Ii appears that both these claims were being intermingled and confused and the rejection of the claim, arising out of the lease granted to coleyana Estate Limited, is the result of the said intermingling and confusion. It may be noted at this stage that this petition pertains to claim of compensation under the lease granted tc Coleyana Estate Limited. The letter dated 25.10.1971 if read keeping in mind the aforesaid distinction it is apparent that the Army Authorities did not reject the claim of compensation under the lease of Coleyana Estate Limited.
13. The second plea in defence is based on clause 22 of the lease agreement, which provides" that the incoming tenant has the option to accept the buildings on the land in excess of his authorisation and if the incoming tenant does not require the accommodation in excess of his authorisation the outgoing tenant is to remove the building material within a period of one month, failing which the entire material shall become the property of the Government. It is also apparent that the value of such buildings is to be assessed by the Collector in accordance with clause 19 of the deed. If this assessm ent is not acceptable to the outgoing tenant then he can remove the building material. Thus the Collector has the last word in the matter of assessment f the value claimable and payable to the outgoing tenant. In the instant case the value admittedly was assessed of the buildings at Rs.4,41,100.00, this assessment was, as indicated above, accepted by the Secretary (Colonics), Board of Revenue, also as the same was recommended for payment in the Memo, issued to the Ministry of Defence.
14. The only thing now to be seen is whether the incoming tenant expressed his unwillingness to have the accommodation in excess of his authorisation and if so whether the outgoing tenant, namely, Late Nawab Sir Muhammad Mehar Shah was asked to remove the building material or not.
The respondents neither produced anything to show that any accommodation in excess of incoming tenants" authorisation existed or that the incoming tenant did not chose to receive the accommodation in excess of his authorisation, if any, and that the outgoing tenant was at any time asked to remove the building material. The outgoing tenant having not been given any such opportunity to remove the building material the entitlement to receive the value of the buildings as assessed cannot be disputed. Thus on merits the claim as to compensation on both these grounds cannot be disputed. Again the rejection of the claim even if made by the Army Authorities was of no legal consequence as under clause 22 referred to above in the letter of the Ministry of Defence itself it is the Collector, who has to evaluate the buildings. This evaluation was made in 1956 and then in 1958 and the entitlement to receive the amount of compensation was not ever in all these years denied, relying on clause 22 of the lease deed. It was too late in the day in 1989 to rely on clause 22 in the parawise comments. It is also pertinent to note that claim with regard to standing trees has been refuted on the plea that most of the trees were cut and removed by late Nawab Sir Muhammad Mehar Shah and reliance in this respect was placed on an order dated 9.2.1979 of the Assistant Commissioner, Okara, but no such assertion as to removal of the building material has been made. The claim as to value of standing trees may be treated as having been refuted successfully as no challenge to the order dated 19.2.1979 of the Assistant Commissioner appears to have been made. The compensation claim for the buildings etc. Thus stands fully established.
15. Now the preliminary objections raised on the last date of hearing may be dealt with. Firstly these objections as were taken on the last date of hearing, during arguments, the same, it was argued, cannot be allowed to be urged. Even otherwise these objections are without merit. Section 19 of the Colonization of Government Lands Act 1912 hardly applies to the situation in had. The lease was surrendered by the Company and such a surrender so made was accepted by the respondents vide letter dated 8.5.1956. No such objection at that time was raised. Even the reference made to the Collector for the purpose of resuming he lease on account of alleged breach of conditions seem to have been filed and not processed further on account of the surrender made. The interest of the Company on winding up admittedly came to vest in the late Nawab Sir Muhammad Mehar Shah. He having purchased the interest had the right in law to claim compensation. Such a right throughout these years was never disputed by the respondents. The value for which the interest of the Company in liquidation was acquired is not relevant and on that account the amount of compensation payable cannot be limited or curtailed.
16. As regards the plea that the suit, if filed in 1983, would have been dismissed as barred "by time, it is to be noted that the right to claim compensation was not disputed ever. The Board of Revenue for the first time vide letter datcd.23.4.83, conveyed the information, as to rejection of the claim made by the late Nawab Muhammad Mehar Shah. In these circumstances the cause of action subsisted when the petition was filed. It may further be noted that the amount as assessed by the Collector was not cascado because of the refusal made by respondent No. 1, in exercise of its executive powers, though under the lease deed the competent authority to assess the compensation was Collector, Sahiwal, and he had admittedly not only assessed the compensation but also held late Nawab Sahib entitled to receive the said compensation. The refusal made in exercise of executive powers by. Respondent No. 1 was challenged by invoking the constitutional jurisdiction. No justifiable exception can be taken to the invocation of the extraordinary jurisdiction of this Court in the afore-noted circumstances.
17. The net result of the above discussion is that the refusal to pay the compensation to the extent of Rs.4,41,100.00 (Rupees four lacs, forty-one thousand and one hundred only) as assessed by the Collector is hereby declared to be illegal and without lawful authority. The refusal to pay claim/compensation in respect of standing trees for the reason noted in one of the paras above is upheld. I am also not persuaded, to allow interest on the amount due, though the same has been withheld for all these years unreasonably, as allowing of interest in cases where there is no statutory compulsion, would amount to acting against the mandate of the Constitution contained in Article 2-A and violative of the Injunctions of Holy Quran. The petition to the above extent is accepted with cost.