1. MUHAMMAD YAQUB ALI, C. J.---Agricultural land measuring 439 acres kanal and 17 marlas, situated in village Danna Hardo in the suburb of Rawalpindi City belonged to the late Rai Bahadar Boota Singh. On his demise his estate fell on his sons and grandsons and was taken under court of Wards by the Financial Commissioner. Out of it 298 kanals and marlas was sold by the Court of Wards to Sardarni Karam Devi, widow Rai Bahadar Boota Singh in 1935. The mutation was sanctioned in her name on the 23rd November 1935. In the year 1936, she mortgaged the land to Messrs Kadu Shah of Rawalpindi by three different transactions for the total sum of Rs. 33,000.
2. On 11th December 1937, Sardarni Karam Devi mortgaged the same land to the Society of Catholic Medical Missionary Incorporated, Washington, for Rs. 50,000. Out of the mortgage money, Rs.
3. 41,588-10-3 as paid for redemption of the first mortgage and the balance amount was aid to Sardarni Karam Devi. It was a simple mortgage and carried Interest at 4% per annum with half- yearly rests. The Holy Family Hospital appellant herein, is the successor-in-interest of the Society of the Catholic Medical Missionary Incorporated in Washington and as such held mortgagee rights in the land.
4. In the year 1957, the Government of Punjab, acquired a large tract of land including the land under mortgage with the appellant for construction of Satellite Town, Rawalpindi. The Award for compensation was given y the Collector on 9th April 1957. The total compensation of the land under mortgage with the appellant was assessed at Rs. 48,729-9-0. The appellant, thereupon, filed a claim before the Collector for payment of the mount but as the owners of the land, mentioned in the Revenue Record, ad become evacuee, the Collector made a reference to the District Judge under section 30 of the Lard Acquisition Act for apportionment.
5. The appellant's claim was disputed by the Rehabilitation Authorities inter alia on the ground that the land acquired by the Collector was evacuee property and that no mortgage subsisted in favour of the appellant.
6. Can 21st March 1959, the District Judge, acting under section. 66 (2) of the Town Improvement Act ruled out the objections filed by the Rehabilitation authorities and held that the appellant was entitled to receive the compensation amount in the sum of Rs. 48,729-9-0.
7. Dissatisfied with the order of the District Judge, the Rehabilitation commissioner filed a writ petition in the High Court which has been ,flowed and the order of the District Judge set aside on the ground that he gad no jurisdiction to proceed in the matter and that the only course open o him was to make a reference to the Custodian of the Evacuee Property Wader section 41(2) of Act XII of 1957.
8. Leave to appeal was granted to consider whether the mortgagee rights held by the appellant since long before 28th February 1947, could be treated as evacuee property more particularly as the Custodian had, at no stage, treated these rights as evacuee property and it was necessary to obtain confirmation of the mortgagee rights by the Custodian.
9. In support of the appeal, Raja Muhammad Akram put up contradictory arguments. At first it was contended by him that it was not necessary to obtain confirmation of the mortgagee rights by the Custodian as the mortgage was created long before the terminal date, 28th February 1947, fixed in the Administration of Evacuee Property Order XV of 1949 for this purpose. In that case the mortgage being simple, the limitation for suing. On its basis to recover the mortgage money by putting the land to auction through the intervention of the Court expired in 1952. Confronted with this position, Raja Muhammad Akram sought shelter behind section 12 of the Ordinance XV of 1949 which enjoined that evacuee property shall not be sold by any civil Court, revenue authorities or tribunal after coming into force of the Ordinance. To obtain benefit of this provisions of law fair extension of limitation, it had to be conceded that the mortgagee rights were evacuee property. If the mortgagee rights held by the appellant were not evacuee property then the period of limitation, prescribed by Article 132, continued to run and the remedy to sue on the basis of the mortgage was 3nst in 1952.
10. Notwithstanding the contradictory arguments raised by Raja Muhammad Akram, it appears that as the land acquired by the Collector was evacuee property the rights held by the appellant in the land under a simple Mortgage could not be enforced without confirmation by the Custodian, The proper remedy open to the appellant was to apply to the Custodian for repayment of the loan advanced by them to Sardarni Karam Devi and, in the alternative, to declare the mortgage amount as a charge on the land.
11. Tire District fudge has held that mortgage created by Sardarni Karam Devi is favour of the predecessor-in-interest of the appellant was a genuine Transaction and that a suns of Rs. 50100 was received by her. The transaction is evidenced by a registered deed and a mutation was attested in the revenue records in favour of the appellant's predecessor. These entries continued to exist in the revenue records till the land was acquired by the Collector in 1957. Since the mortgage was created before 18th February 1947, it was not necessary for the appellant to apply to the Custodian for a declaration under section 18 of the Administration of Evacuee Property Ordinance XV of 1949. Nevertheless permission of the Custodian was necessary to receive the compensation amount from the Collector as the Rehabilitation authorities not only claimed that the land acquired by the Collector was evacuee property, tire existence of the mortgage in favour of appellant was also denied. 'the District Judge was not vested with the ,jurisdiction to adjudicate upon these issues and it was necessary for him to make a reference to the Custodian under section 41(2) of Act XII of 1957 which had, by then, replaced Ordinance XV, for decision as to : (i) whether the mortgage created on 11 to December 1937, by Sardarni Karam Devi in favour of the predecessors of the appellant subsisted ; (ii) whether the sum of Rs. 50,000 paid by the mortgagee was a prior charge on the land ; and (iii) whether in lies of the mortgage money, the appellant was entitled to receive the sum of Rs.48,729-9-0 assessed by the Collector as compensation of the land. If the answer to these questions is in the affirmative, the right of the appellant to receive the compensation amount for the land under mortgage would be established.
12. The High Court has, however, simply set aside the order passed by the District Judge as without jurisdiction. We, accordingly, allow the appeal' and refer to the Custodian of Evacuee Property.
13. Punjab the three questions formulated above.
14. The appeal is allowed in the above terms without, any order as to costs.