Pirthi vs Mohan Singh & Ors

Pirthi .... Appellant (s)

Versus

Mohan Singh & Ors. .... Respondent(s)

J U D G M E N T

P. Sathasivam, J.

1) This appeal is directed against the final judgment and

order dated 07.03.2002 passed by the High Court of Punjab

and Haryana at Chandigarh in RSA No. 136 of 2001 whereby

the High Court dismissed the appeal filed by the appellant

herein.

2) Brief facts:

(a) The appellant-plaintiff and respondent No.5 - whose

name has been deleted from the array of parties by this

Court's order dated 08.08.2003, filed a suit for possession by

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way of pre-emption being Civil Suit No. 107/92/93 against

respondent Nos. 1-4 herein (Defendants) before the Civil Judge

(Jr. Division), Bahadurgarh, Haryana claiming themselves to

be co-sharers with the vendor - Shiv Lal-defendant No.3

(respondent No.3 herein-since deceased, his legal

representatives are on record), who sold away his half share of

the suit land comprised in Khewat No. 22 (min.), Khasra Nos.

47 and 48, Khasra No. 1043 measuring 3 bighas, 3 biswas

pukhta 1058 (2-11) and Khewat No. 28 (min.), Khasra Nos.

54-55. Khasra No. 5496/1693 (2-16) 5497/1693(1-5) total

measuring 10 Bighas 8 Biswas to defendant Nos. 1 & 2

(respondent Nos. 1 & 2 herein) by sale deed dated 08.06.1992

for a consideration of Rs.1,40,000/- and for declaring the

lease deed No. 326 dated 07.05.1992 illegal, null and void and

unwarranted by law. Defandant Nos. 1 & 2 are brothers and

defendant No. 4 (respondent No.4 herein) is their mother.

(b) When the case was fixed for service of the remaining

defendants, defendant Nos. 1 & 4 filed an application for

dismissing the suit of the plaintiffs being not maintainable on

the ground that after passing of the Punjab Pre-emption

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(Haryana Amendment) Act, 10 of 1995, (hereinafter referered

to as "the Act") the right of pre-emption on the basis of co-

sharership is not available to them. The Civil Judge (Jr.

Division), by judgment dated 09.02.1996, accepting the

application filed by the defendants dismissed the suit filed by

the plaintiffs.

(c) Aggrieved by the said judgment, the plaintiffs filed an

appeal being Civil Appeal No. 23 of 1996 before the Additional

District Judge, Jhajjar. By order dated 18.07.2000, the

Additional District Judge dismissed the appeal filed by the

plaintiffs.

(d) Challenging the order passed by the Additional District

Judge, Pirthi-plaintiff No.1 (appellant herein) filed regular

second appeal being RSA No. 136 of 2001 before the High

Court of Punjab & Haryana at Chandigarh. The High Court,

by impugned judgment dated 07.03.2002, holding that the

plaintiff/appellant had lost the character of a co-owner during

the pendency of the suit, dismissed the appeal. Against the

said judgment, the appellant-plaintiff has filed this appeal by

way of special leave petition before this Court.

3 3) Heard Mr. Mahabir Singh, learned senior counsel for the

appellant and Mr. Pramod Dayal, learned counsel for

respondent Nos. 2 & 4. Despite service of notice, respondent

Nos.1 and 3 have not chosen to appear in-person or through

counsel.

Discussion:

4) It is the case of the respondents/defendants that

superior right of pre-emption on the basis of co-sharership is

not available to plaintiffs now. After passing of the Act, this

right has been restricted only to the tenants and the plaintiffs

have no locus-standi to file and pursue their suit as they are

not claiming the right as tenants. It is the claim of the

appellant/plaintiff that the suit in question was instituted

prior to the amendment in the Punjab Pre-emption Act, 1913

hence the amendment in the Act is not applicable to the

present case. The trial Court accepted the objection of the

defendants as to the maintainability of the suit and dismissed

the same as not maintainable which was affirmed by the lower

appellate Court. The same view has been reiterated by the

High Court by dismissing the second appeal.

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5) It is true that the suit, in the present case, was filed prior

to the amendment in the Punjab Pre-emption Act, 1913.

Section 15 of the Pre-emption law has been amended and

notified vide Gazette Notification dated 17.05.1995 which

reads as under:

"15. Right of Pre-emption to vest in tenant - The right of

pre-emption in respect of sale of agricultural land and village

immovable property shall vest in the tenant who holds under

tenancy of the vendor/vendors the land or property sold or a

part thereof."

This change in the law affects all pre-emption cases based

upon the co-sharership. In view of this change in the law, a

co-sharer has no right to bring a suit for possession by way of

pre-emption, hence the application filed by the defendants for

dismissing the suit of the plaintiffs being not maintainable had

been accepted by the trial Court and suit of the plaintiff came

to be dismissed. This was affirmed by the lower appellate

Court and finally by the High Court which order is under

challenge in this appeal.

6) While ordering notice on the special leave petition, even

as early as on 02.09.2002, it was specifically mentioned that

as to why the case be not decided in the light of a Constitution

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Bench judgment in Shyam Sunder and Others vs. Ram

Kumar and Another, (2001) 8 SCC 24.

7) In Bhagwan Das (dead) by LRS. and Others vs. Chet

Ram, 1971 (1) SCC 12, a three-Judge Bench of this Court,

while considering right of pre-emption has held that pre-

emptor's right should subsist till institution of suit for pre-

emption and passing of decree. It was further held that the

rule that a pre-emptor must maintain his qualification to pre-

empt up to the date of decree was recognized as well settled.

8) In Rikhi Ram and Another vs. Ram Kumar and

Others, (1975) 2 SCC 318, again, a three-Judge Bench of this

Court, while considering right of pre-emption under the

Punjab Pre-emption Act, 1913, after adverting to the principles

laid down in Bhagwan Das (supra) and considering Section

15(1) of the Punjab Pre-emption Act held that under the

general law of pre-emption, it is firmly established that the

decisive date as regards the right of pre-emptor to pre-empt

the sale was the date of the decree. In other words, the pre-

emptor who claims the right to pre-empt the sale on the date

of the sale must continue to possess that right till the date of

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the decree. If he loses that right before the passing of the

decree, decree for pre-emption cannot be granted even though

he may have had such right on the date of the suit.

9) Now, let us consider the decision of the Constitution

Bench i.e. Shyam Sunder (supra) and its applicability to the

case on hand. Both the above decisions being Bhagwan Das

(supra) and Rikhi Ram (supra) were relied on by the

Constitution Bench.

10) The very same Haryana Amendment Act, 10 of 1995,

which introduced Section 15, was considered by a

Constitution Bench in Shyam Sunder (supra). The question

posed before the Constitution Bench was:

"What is the effect of substituted Section 15

introduced by the Haryana Amendment Act, 1995

(hereinafter referred to as `the amending Act, 1995')

in the parent Act i.e. the Punjab Pre-emption Act

(hereinafter referred to as `the parent Act') as

applicable to the State of Haryana whereby the right

of a co-sharer to pre-empt a sale has been taken

away during the pendency of an appeal filed against

a judgment of the High Court affirming the decree

passed by the trial Court in a pre-emption suit?"

11) When in the case of Shyam Sunder (supra), the main

appeal, i.e., Civil Appeal No. 4680 of 1993 came up for hearing

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before a Bench of this Court, the Bench, on the question of the

effect of the amendment made in 1995 in the parent Act,

found that there is conflict in the view taken in the decisions

of two three-Judge Benches of this Court, which are Didar

Singh vs. Ishar Singh (2001) 8 SCC 52 wherein it was held

that in a suit for pre-emption, the pre-emptor must prove his

right to pre-empt up to the date of decree of the first court and

any loss of right or subsequent change in law after the date of

adjudication of the suit and during pendency of appeal would

not affect the decree of the first court and Ramjilal vs. Ghisa

Ram (1996) 7 SCC 507 wherein it was laid down that appeal

being continuation of the suit, the right to claim pre-emption

must be available on the date when the decree is made and is

finally to be affirmed or needs to be modified at the time of

disposal of the appeal therefrom, and since the amending Act

came into force during pendency of appeal, the right and

remedy of the plaintiff stood extinguished and as a result the

suit must fail. In order to resolve the conflict between the

aforesaid two decisions rendered by two different Benches, the

Bench referred the appeal for decision by a Bench of five

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Judges. It is in this way, the matter was heard by the

Constitution Bench.

12) The Constitution Bench noted the facts which have given

rise to Civil Appeal No. 4680 of 1993. The defendant-

appellants herein purchased land measuring 54 kanals,

situated in Village Rithal Phogat, being 1/2 share of the land

of Khewat Nos. 204, 205 and 206, measuring 108 kanals for a

sum of Rs 84,000/- from vendors viz. Bharpai, Chhoto and

Pyari -- daughters of Bhagwana vide sale deed dated

17-07-1985. The plaintiff-respondents herein claimed

preferential right to pre-empt the sale in favour of the

defendant-appellants on the ground that they are co-sharers

by means of a civil suit laid before the Sub-Judge, Ist Class,

Gohana. In the said suit, issues were framed and the trial

court decided all the issues in favour of the plaintiff-

respondents and consequently on 30-5-1990 the suit was

decreed. The respondents after passing of the decree by the

court of first instance deposited the purchase money as

required under Order 20 Rule 14 CPC. The appeal preferred by

the appellants before the first appellate court and the second

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appeal before the High Court were dismissed and the decree of

the trial court was affirmed. The appellants thereafter

preferred this appeal by way of special leave petition. During

pendency of the appeal, Section 15(1)(b) of the parent Act, on

the basis of which the suit was filed by the plaintiff-

respondents, was amended and was substituted by new

Section 15 whereby the right of a co-sharer to pre-empt a sale

was taken away. The substituted Section 15 of the Act has

been quoted earlier.

13) Since several decisions have been cited, the Constitution

Bench categorized those decisions and referred them as first,

second and third categories of decisions. The first category of

decisions are those wherein the view of law expressed is that

in a suit for pre-emption, the pre-emptor must possess his

right to pre-empt right from the date of sale till the date of

decree of the first court, and loss of that right after the date of

decree either by own act, or an act beyond his control or by

any subsequent change in legislation which is prospective in

operation during pendency of the appeal filed against the

decree of the court of first instance would not affect the right

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of the pre-emptor. The second category of decisions deals with

the cases where right of a pre-emptor was taken away after the

date of decree of the first court and during pendency of the

appeal by statutory enactment which had retroactive

operation. In such cases, it was held that the appellate court

is competent to take into account legislative changes which

are retrospective and accordingly affect the rights of the

parties to the litigation. The decisions in the third category of

cases are those where it has been held that appeal being a

continuation of the suit, the right to pre-empt a sale must be

available on the date when the decree is made and is finally to

be affirmed or needs to be modified at the time of disposal of

appeal and in case of loss of right by legislative changes

during pendency of appeal, the suit for pre-emption must fail.

After analyzing various decisions referred to in the first

category, the Constitution Bench formulated the following

legal principles:

"1. The pre-emptor must have the right to pre-empt on the

date of sale, on the date of filing of the suit and on the date

of passing of the decree by the court of the first instance

only.

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2. The pre-emptor who claims the right to pre-empt the sale

on the date of the sale must prove that such right continued

to subsist till the passing of the decree of the first court. If

the claimant loses that right or a vendee improves his right

equal or above the right of the claimant before the

adjudication of suit, the suit for pre-emption must fail.

3. A pre-emptor who has a right to pre-empt a sale on the

date of institution of the suit and on the date of passing of

decree, the loss of such right subsequent to the decree of the

first court would not affect his right or maintainability of the

suit for pre-emption.

4. A pre-emptor who after proving his right on the date of

sale, on the date of filing the suit and on the date of passing

of the decree by the first court, has obtained a decree for

pre-emption by the court of first instance, such right cannot

be taken away by subsequent legislation during pendency of

the appeal filed against the decree unless such legislation

has retrospective operation."

14) The legal position that emerges on review of the second

category of decisions is that the appeal being a continuation of

the suit, the appellate court is required to give effect to any

change in law which has retrospective effect. In para 15, the

Constitution Bench has held that the legal principle that

emerges out of the aforesaid decisions is that an appeal being

a continuation of the suit, the right to pre-empt must be

available on the date when the decree is made and is finally to

be affirmed or needs to be modified at the time of disposal of

the appeal and where right and remedy of the plaintiff has

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been taken away statutorily during pendency of appeal, the

suit must fail.

15) The following discussion and conclusion in para 28 are

relevant:

"... ..... In Shanti Devi v. Hukum Chand, (1996) 5 SCC 768,

this Court had occasion to interpret the substituted Section

15 with which we are concerned and held that on a plain

reading of Section 15, it is clear that it has been introduced

prospectively and there is no question of such section

affecting in any manner the judgment and decree passed in

the suit for pre-emption affirmed by the High Court in the

second appeal. We are respectfully in agreement with the

view expressed in the said decision and hold that the

substituted Section 15 in the absence of anything in it to

show that it is retrospective, does not affect the right of the

parties which accrued to them on the date of the suit or on

the date of passing of the decree by the court of first

instance. We are also of the view that the present appeals

are unaffected by change in law insofar it related to

determination of the substantive rights of the parties and the

same are required to be decided in the light of the law of pre-

emption as it existed on the date of passing of the decree."

16) After analyzing all the decisions cited therein, the

Constitution Bench has concluded thus:

"44. From the aforesaid decisions, the legal principle that

emerges is that the function of a declaratory or explanatory

Act is to supply an obvious omission or to clear up doubts as

to meaning of the previous Act and such an Act comes into

effect from the date of passing of the previous Act. Learned

counsel for the appellants strongly relied upon a decision of

a two-Judge Bench of this Court in Mithilesh Kumari v. Prem

Behari Khare in support of his argument. In the said

decision, it was held by this Court that the Benami

Transactions (Prohibition) Act, 1988 being a declaratory Act,

the provisions of Section 4 of the Act have retroactive

operation. The reliance on this decision by the appellants'

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counsel is totally misplaced as this decision was overruled in

R. Rajagopal Reddy v. Padmini Chandrasekharan wherein it

was held that the Act was not passed to clear any doubt that

existed as to the common law or the meaning of effect of any

statute and it was, therefore, not a declaratory Act.

45. We have already quoted substituted Section 15 of the

amending Act but do not find that the amending Act either

expressly or by necessary implication intended to supply an

omission or to clear up a doubt as to the meaning of the

previous Section 15 of the parent Act. The previous Section

15 of the parent Act was precise, plain and simple. There

was no ambiguity in it. The meaning of the words used in

Section 15 of the parent Act was never in doubt and there

was no omission in its phraseology which was required to be

supplied by the amending Act. Moreover, the amending Act

either expressly or by implication was not intended to be

retroactive and for that reason we hold that amending Act 10

of 1995 is not a declaratory Act and, therefore, it has no

retrospective operation.

46. For the aforestated reasons, we approve the view of law

taken in Didar Singh v. Ishar Singh and further hold that the

decision in the case of Ramjilal v. Ghisa Ram does not lay

down the correct view of law.

47. The result of the aforesaid discussion is that the

amending Act being prospective in operation does not affect

the rights of the parties to the litigation on the date of

adjudication of the pre-emption suit and the appellate court

is not required to take into account or give effect to the

substituted Section 15 introduced by the amending Act.

48. In view of what has been stated above, these appeals fail

and accordingly are dismissed, but there shall be no order as

to costs."

17) From the above discussion, particularly, in para 45, the

Constitution Bench observed that the Amending Act 10/1995

is not a declaratory Act and, therefore, it has no retrospective

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operation. In para 46, the Constitution Bench has approved

the view of law taken in Didar Singh (supra) and further held

that the decision in the case of Ramjilal (supra) does not lay

down the correct view of law. No doubt, in the penultimate

para 47, the Constitution Bench has concluded that the

amending Act being prospective in operation does not affect

the rights of the parties to the litigation on the date of

adjudication of the pre-emption suit and the appellate court is

not required to take into account or give effect to the

substituted Section 15 introduced by the amending Act. It is

clear that the appellate court is not required to take into

account or give effect to the substituted Section 15 introduced

by the amending Act. On the other hand, as discussed and

concluded in para 46, the dictum laid down in Didar Singh

(supra) has been approved. In Didar Singh (supra), it was

held that in a suit for pre-emption, pre-emptor must prove his

right to pre-empt up to the date of the decree of the first court

and any loss of right or subsequent change in law after the

date of adjudication of the suit and pre-tendency of appeal

would not affect the decree of the first court. The said view

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has been approved by the Constitution Bench. In other words,

in a suit for pre-emption, the pre-emptor must prove his right

to pre-empt up to the date of decree of the first court. To put

it clear, the pre-emptor must have the right to pre-empt on the

date of sale on the date of filing of the suit and on the date of

passing of the decree by the court of the first instance

[Emphasis supplied]. In the case on hand, the amendment

Act came into force with effect from 17.05.1995 and suit had

been laid on 31.10.1992. In other words, on the date of

institution of the suit, the plaintiff/pre-emptor had a right to

claim "right of pre-emption". However, during the pendency of

the suit, since the amendment Act came into force, deleting

the right of pre-emption and in the absence of such right on

the date of passing of the decree by the court of first instance,

we are of the view that both the courts below have correctly

appreciated the effect of the amendment and the High Court

also rightly dismissed the second appeal holding that the

plaintiff had lost the character of a co-owner during the

pendency of the suit by virtue of the amendment Act.

16 18) In view of the above discussion and the interpretation of

the Constitution Bench in respect of substituted Section 15

introduced by the Haryana Amendment Act, 1995 in the

Parent Act i.e. the Punjab Pre-emption Act, we concur with the

view expressed by all the three courts including the High

Court. Consequently, the appeal fails and the same is

dismissed. No order as to costs.

..........................................J.

(P. SATHASIVAM)

..........................................J.

(H.L. GOKHALE)

NEW DELHI;

September 2, 2011.

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