SHAFIUR RAHMAN, J.--Leave to appeal was granted to the unsuccessful claimants for the transfer of property to examine whether the non-confirmation of the mortgage in their favour deprived them of the right to claim transfer of the property under Settlement Scheme No. VIII framed under the Displaced Persons (Compensation and Rehabilitation) Act, 1958 (hereinafter referred to as the Act) and whether the tenants inducted by them as unconfirmed mortgagees of the property could be given preference over them in the matter of transfer.
2. The admitted facts on which the High Court decision proceeds are that property No. B. V-2S-33, situate in Wazirabad consisting of four shops was owned originally by one Dayal Chand. He mortgaged this property on 13th of March, 1974 with possession in favour of Abdul Hafeez and Abdur Rashid, the two brothers. The owner migrated. The mortgagees did not apply to the Custodian for getting the mortgage confirmed. The shops were let out in due course to respondents Nos. 3 to 6. All of them, the appellants as well as the respondents, became claimants for the transfer of the shops. The Deputy Settlement Commissioner by an order dated 17th of April, 1974 preferred the claim of the appellants/mortgagees and allowed transfer of all the shops to them. The respondents were mainly held disentitled for the reason that their possession was under the mortgagees. The respondents appealed against the decision to the Additional Settlement Commissioner. The ground which prevailed with the Additional Settlement Commissioner appears from his order as hereunder:-- "I find that the mortgage deed which was executed in favour of the respondents on 24-3-1947 had not been got confirmed from the learned Custodian of the Evacuee Properties and the respondent by concealment of facts continued to enjoy the proprietary rights and its benefits against a void mortgage deed till revised Settlement Scheme No.VIII came into force. As such the illegal act of the respondents cannot be allowed to stand because his rights if any accrued to them by the mortgage deed were discontinued at the time when the property had been got acquired in favour of the Government on 21-8-1959. It could be safely said that the respondents cannot be considered as lawful occupants of the property in suit. The property being an evacuee property stood acquired in favour of the Central Government free from all encumbrances and claim of any person or party had been extinguished from the date of the said notification because in the instant case the mortgage deed was not got confirmed from the learned Custodian of the Evacuee Properties and in the absence of the confirmation of the mortgage deed from the learned Custodian the respondents could not be deemed in possession of the property as it has lost his legal sanctity and force and is a waste paper and consequent to that the respondents fall out from the ambit of subsection (6) of section 2 of the Displaced Persons Act, 1958 and remain no longer in possession of property in dispute and are debarred to get benefit out of it by renting it out to any body else including the present petitioners."
3. The Constitution petition filed by the appellants failed in the High Court for the reason appearing as hereunder: "Admittedly, the mortgage here was created by the evacuee owner in favour of the petitioner No. 2 and father of petitioner No. 1 after the first of March 1947.. The mortgagee did not move the Custodian for the confirmation of the mortgages transaction. Consequently no rights could be said to have accrued in their favour under the said mortgage by operation of section 20 (1) of the Pakistan (Administration of Evacuee Property) Act, 1957. The property, therefore, had to be treated as of evacuee nature. Now, under section 10 (2) of the said Act it was the duty of the mortgagees to intimate to the Custodian in writing their willingness to surrender the property to him or to his representative. Further, under section 11 of the same Act they were required to give full information to the Custodian about the property and furnish detailed accounts of the rents, profits and income which they had received therefrom eversince they took over its possession under the mortgage.
They did nothing of this sort. Their omission in this regard constituted an offence under section 34 of the said Act."
4. After hearing the learned counsel for the parties we find that the respondents were undisputedly inducted into the property by the appellants. They derived their interest and right of possession from the appellants and from none else. The definition of "possession" as contained in section 2(6) of the Act has been deleted from the Act since 1973 (1973 Central Statutes 596) thereby leaving in the field the non-restrictive definition of possession in the field as judicially interpreted. Even the ordinary dictionary meaning of `possession' would not extend to make it synonymous with `occupation'. There is a long series of decisions distinguishing `possession' and `occupation' and among them can be referred Muhammad Khan and others v. The Chief Settlement and Rehabilitation Commissioner, West Pakistan and another (PLD 1962 SC 284), Abdul Rahman and another v. Deputy Settlement Commissioner II and another (PLD 1977 Lahore 576), Ambo Jan v.
Assistant Settlement Commissioner (Land) etc. PLD 1975 Pesh. 244, Syed Muhammad Munir Shah v.
Mst. Akbar Jan and others (PLD 1963 Lahore 59) and Haji Abdul Karim v. The Chief Settlement Commissioner and others (PLD 1961 Lahore 394 ).
5. The provisions of the Pakistan (Administration of Evacuee Property) Act, 1957 relevant to the subject, are sections 10, 22 and 34. These are reproduced as hereunder:-- "10. Holding of evacuee property and its surrender.--(1) Every person who is, or has at any time after the twenty-eighth day of February 1947, been in possession, supervision or management of any evacuee property, shall be deemed to hold or to have held, as the case may be, such property on behalf of the Custodian.
(2) Every person who is in possession, supervision or management of any evacuee property or property which he knows or has reasons to believe is evacuee property, and whose authority or right to occupy, supervise or manage such property after the twenty-eighth day of February, 1947, has not been accepted or approved by the Custodian, shall, as soon as may be but not later than such date as may be notified by the Central Government in the official Gazette, intimate to the Custodian in writing his willingness to surrender such property to the Custodian or to any person authorised by the Custodian in this behalf, and shall surrender the same if called upon by the Custodian or any person authorised as aforesaid.
(3) The provisions of subsection (2) shall not apply to any person who is in possession, supervision or management of any evacuee property by virtue of an allotment made by a Rehabilitation Authority."
"22. Claims by interested persons.---(1) Any person claiming any right or interest in any property treated by the Custodian or a Rehabilitation Authority as evacuee property may prefer a claim to the Custodian on the ground that-- (a)the property is not evacuee property, or (b)his interest in the property has not been affected by the provisions of this Act.
(2) An application under subsection (1) shall be made within the prescribed period being a period of not less than thirty days from the prescribed date.
(3) On receiving an application under subsection (2) the Custodian shall hold a summary inquiry in the prescribed manner, and after taking such evidence as may be produced, shall pass an order, stating the reasons therefor, rejecting the application or allowing it wholly or in part on such terms and conditions as he thinks fit to impose."
"34. Failure to surrender property or submit information and account to Custodian.--If any person fails to intimate his willingness to surrender, or when called upon to surrender, fails to surrender any evacuee property in accordance with the provisions of subsection (2) of section 10 or to submit such information or account as is required under section 11 he shall be punishable with imprisonment for a term which may extend to one year or with fine or with both."
6. If the appellants wanted the recognition of the mortgage and its enforcement, they had the option to approach the Custodian and get a declaration under section 22 of the Pakistan (Administration of Evacuee Property) Act, 1957. However, it was not compulsory for them to do so.
Nevertheless, being in possession of evacuee property, they had a duty to inform the Custodian.
Their continuance in possession beyond the specified date without informing the Custodian would make them liable under section 10 for eviction and under section 34 for prosecution. All the same, the fact of their possession in breach of these provisions of law cannot be disputed. Their possession at some stage being lawful would get converted into unlawful after a particular stage.
Nevertheless, it will remain a possession in view of the deletion of the restrictive definition of `possession' in Evacuee Property and Displaced Persons Laws (Amendment) Act, 1973 (Act LV of 1973). The appellants cannot be deprived of their right flowing from such possession on the only ground that it had ceased to be in accord with law after a particular stage. In any competition, between themselves and their tenants, they have to be preferred in the matter of possession having entered possession and claiming nothing more but possession for. a date prior to independence. .
7. In the circumstances, we accept this appeal, set aside the judgment of the High Court and restore the order of the Deputy Settlement Commissioner dated 17-4-1974. The property has to be treated as one unit because it was owned by one evacuee, was dealt with as one property and the possession of the appellants extends over the whole of it through their tenants. No order is made as to costs.