Suit

Constitution Petition No.D-788 of 2009

Present:

Mr. Justice Sajjad Ali Shah

Mr. Justice Naimatullah Phulpoto

Date of hearing: 28^th March 2013

Petitioner: M/s. Pakistan Services Limited, through M/s. Rasheed A. Razvi and Farhatullah, Advocates.

Respondent 2: National Accountability Bureau Sindh through Mr. Noor Muhammad Dayo, DPG for NAB.

Respondent No.4: Asif Baigmohammad through Mr. Muhammad Ashraff Kazi and Syed Nasir Abbas Rizvi, Advocates.

Land Utilization Department through Mr. Muhammad Ahmed Pirzada, Advocate

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J U D G M E N T

SAJJAD ALI SHAH, J :- The petitioner through instant petition has impugned the order of the Accountability Court dated 11.04.2009 whereby the learned Accountability Court while allowing an application moved on behalf of respondent No.4 (one of the accused in Reference No.24 of 2002) held that the transfer of title or creation of third party interest in the subject land during pendency of reference in terms of Section 23(a) of the National Accountability Bureau Ordinance, 1999 (hereinafter referred to as “Ordinance 1999) was void.

2. Mr. Rasheed A. Razvi, learned counsel appearing on behalf of the petitioner, contends that the petitioner on 02.6.2007 had purchased 1/3^rd undivided share out of 341 acres of land from Ms. Seema Tressa Gill, one of the partners reflected in the Conveyance Deed dated 29.9.1996 of M/s. Marina City Developments through an Agreement of Sale dated 02.6.2007 added by registered power of attorney duly executed on the same day by Ms. Seema Tressa Gill in favour of the petitioner’s representative. The petitioner further upon issuance of challan from the Government of Sindh on 08.3.2012 in respect of 1/3^rd of such land has deposited the differential amount of Rs.59,031,200/- in the treasury and thereafter got a registered conveyance deed executed in its favour on 19.4.2012. Per learned counsel, since neither the petitioner nor its predecessor-in-interest was a party in the subject reference before the Accountability Court, therefore, the order of Accountability Court declaring all transactions regarding transfer, sale or creation of third party interest in the land subject matter of reference without hearing the petitioner was bad in law. It was next contended by the learned counsel that the petitioner is a bonafide purchaser of the subject land for valuable consideration without notice of any pending litigation, therefore, the impugned order cannot sustain against the petitioner.

3. On the other hand, Mr. Noor Muhammad Dayo, learned ADPG for the NAB, contends that the reference in respect of subject matter was pending before the Accountability Court since 2002 and despite the impugned order of the Accountability Court declaring all transactions in respect of subject land entered into after filing of the reference as void in terms of Section 23(a) of the Ordinance 1999, the petitioner paid the loss assessed by the Government of Sindh in the treasury as differential and thereafter got a registered deed executed in its favour which of-course cannot sustain due to the bar as contained in Section 23(a) of the Ordinance 1999. He, therefore, prays that the instant petition be dismissed.

4. We have heard the learned counsel for the respective parties and perused the record with their able assistance.

5. Briefly, Agha Tariq ex-Minister Mineral Development, Government of Sindh on 4.7.1996 managed excavation license for mineral in respect of 341.68 acres of Government land for a period of 30 years in favour of her wife Mst. Gulnar Begum. He thereafter himself by exploiting his position dishonestly, fraudulently and deceitfully in connivance with other accused by distorting the facts and in violation of law and rules on 4.8.1996 got converted 30 years license for mining purposes into 99 years lease for industrial/residential/commercial purposes and thereafter on 29^th of September 1996 through registered conveyance deed sold the said land to M/s. Marina City Developments, a partnership of M/s. Asif Baig Muhammad, Khalid Masood and Ms. Seema Tressa Gill (predecessor-in-interest of the petitioners). The record further reflects that the Secretary Land Utilization Department on 11.7.1997 served notices upon Mst. Gulnar Begum and on her non-appearance taking into account gross violation of the conditions of the sale/policy cancelled the allotment/lease and directed the Deputy Commissioner to resume the said land even if it is in possession of any other person including Marina City Developments to whom the said land was transferred unauthorizedly in complete disregard to the provisions of the Colonization of Government Land Act, 1912.

6. It further appears from the record that the said order of the Secretary Land Utilization dated 11.7.1997 cancelling the lease was called in question by M/s. Marina City Developments in this Court by filing Suit No.970/1997 and during the pendency of this suit, the fraudulent act of ex-Minister was taken note of by the National Accountability Bureau by filing Reference No.24/2002 asserting therein that accused Agha Tariq an Ex-Minister Government of Sindh dishonestly and fraudulently routed an application in his own department through her wife Mst. Gulnar Begum and deceitfully obtained mining license for 30 years over the land admeasuring 341.68 acres in District Malir, Karachi Division in the Malir Delta. It has been further asserted in the reference that M/s. Arif Baig Mohammad (respondent No.4) and accused Khalid Masood were actively involved in the land scam to obtain pecuniary benefits and consequently Mst. Gulnar Begum moved incomplete application requesting conversion of 30 years licence of the land for mining purposes into 99 years lease for residential/commercial/industrial purposes, which ultimately by distorting the fact and misusing the authority was allowed. The reference questioned the grant as the land in question was situated on the River bed and its disposal was a safety risk and further that it caused unlawful loss to public exchequer.

7. The record reflects that ‏M/s. Marina City Developments on 6.12.2005 received a letter from the Section Officer-I, Government of Sindh, Land Utilization Department, asserting therein that the Sindh Government Land Committee has assessed the loss to the exchequer in terms of Ordinance III of 2001 to the extent of Rs.26,62,000/- per acre, however, it further specified that the land was cancelled through a judicial order passed on 9.9.1997 (referred to above) and since in Suit No.970/1997 (referred to above) status quo has been ordered and unless this order is set aside Land Utilization cannot move further. M/s. Marina City Developments consequently unconditionally withdrew the said suit on 11.5.2006, despite assertion of the Land Utilization Department that the order dated 9.9.1997 through which subject land was cancelled by the Secretary Land Utilization Department was a judicial order. Since nothing happened after withdrawal of suit, therefore, M/s. Marina City Developments filed Constitution Petition No.D-2088/2006 seeking regularization of land in question and issuance of challan for payment of differential which was also dismissed by this Court vide its Order dated 07.03.2008.

8. Thereafter as appears from the record that on 27.6.2006 an opinion was obtained from the Advocate General Sindh who after examining the validity of Order dated 09.08.1997 passed by the Secretary Land Utilization Department opined that the order was bad and literally by setting aside the order through an opinion it was suggested that the challan for the differential is bound to be issued. It further appears that the Chairman Sindh Government Land Committee on 18.01.2012 also more or less gave similar opinion by relying on the opinion of the Advocate General and suggested that the land be given to the allottees upon payment of differential amount of Rs.26,62,000/- per acre. It is very strange to note that while Advocate General gave the opinion for regularization and issuance of challan, whereas Additional Advocate General in C.P.No.D-2088/2006 filed by the respondent No.4 seeking regularization of the subject land made following submissions before a Division Bench of this Court recorded in order dated 07.03.2008: -

“On the other hand, Mr. Muhammad Sarwar Khan, learned AAG, has strongly disputed the claim of the firm on the ground that 341.23 acres of land on which they are fighting was simply a grant for mining purposes and could not be leased for 99 years nor it can be regularized under Ordinance III of 2001 as the same was cancelled before the promulgation of Ordinance III of 2001. He further submits that Chief Minister Sindh has no power to convert the lease from mining to other purposes and that the land is part of delta and it will not be in the interest of the public to lease out such land.”

9. It is further important to mention here that two partners of M/s. Marina City Developments viz. Arif Baig Mohammad (respondent No.4) and Khalid Masood claimed that their share in the partnership was 70% and 29.9%, whereas the share of Ms. Seema Tressa Gill (predecessor-in-interest of the petitioner) was only to the extent of 0.1% and further that she had even relinquished that 0.1% of her share in fravour of the partners by executing Deed of Relinquishment. They further claimed that since the Sale Deed executed by Mst. Gulnar Begum in favour of M/s. Marina City Developments only contained the name of partners without prescribing the extent of their shareholding in the partnership, thus taking benefits of such fact Ms. Seema Tressa Gill managed the transfer of 1/3^rd of the property of partnership in favour of the petitioner.

10. It appears that in this backdrop Ms. Seema Tressa Gill (predecessor-in-interest of the petitioner) one of the disputed partners of Marina City Development (which partnership was subsequently converted into a private limited company) on 02.06.2007 (during pendency of Reference No.24 of 2002) entered into an agreement for the sale of her disputed 1/3^rd of undivided land out of 341.68 acres with the petitioners and, thereafter, on the same day executed a registered Power of Attorney in their favour. In order to cater with this situation whereby Ms. Seema Tressa Gill had transferred undivided land out of 341.6 acres to the petitioner, respondent No.4 who was an accused before Accountability Court in Reference No.24/2002 moved two applications before the Accountability Court, one under Section 23(a)&(b) of Ordinance 1999 seeking cancellation of all transactions in respect of land subject matter of reference which had taken during pendency of reference, which was allowed by the Accountability Court leading to filing of the instant petition, whereas through second application it was prayed that order dated 9.8.2007 of Secretary Land Utilization be declared to be an administrative order and direction to Government of Sindh to issue challan for the differential amount. The dismissal of second application led filing of Constitution Petition No.D-2601/2009 by the respondent No.4, which petition was dismissed by us vide our judgment dated 28.3.2013 by holding as under: -

“We have totally failed to understand that, as to how, an order which was passed by the Member Land Utilization while exercising power under Section 164 of the West Pakistan Land Revenue Act, 1967 on 07.8.1997 cancelling the entire 341.68 acres of land could be set aside through an opinion, may be of the Advocate General or the Chairman Sindh Government Land Committee specially when it was unsuccessfully called in question before this Court first in Suit No.970/1997 which was also withdrawn and thereafter in Const. Petition No.D-2088/2006 in which also more or less similar relief was claimed. To our mind, since the grant/lease of land in question was cancelled on 7.8.1997 by the Member Land Utilization while exercising power under Section 164 of the West Pakistan Land Revenue Act, 1967, therefore, there was neither any existing grant which could have come to an end by virtue of Ordinance III of 2001 or could have been regularized thereunder. Even otherwise, it was not for the Accountability Court to embark upon such intricate question regarding validity or existence of the grant/lease or to impart direction for issuance of challan for payment of differential specially when the Government on 7.3.2008 in Constitution Petition No.D-2088/2006 itself has pleaded that “Chief Minister Sindh has no power to convert the lease from mining to other purposes and that the land is part of delta and it will not be in the interest of the public to lease out such land”., therefore, in our opinion the request was rightly declined.

We may further add here that Ordinance III of 2001 provides for cancellation of allotments, conversions or exchange of Urban State land obtained or granted for residential or commercial purposes at the rate lower than the market value in violation of law or ban from 1^st January 1985 and empowers a Committee constituted under Ordinance III of 2001 to assess/determine the amount of loss caused to the Government on account of such grant and to call upon the person concerned to pay such amount within a specified time. However, to our mind, the Ordinance III of 2001 envisages regularization of only those lands which were competently granted/allotted, but for a price lower than its market value in violation of law or ban, but does not provide for the regularization of those lands where guarantor lacks the authority. Beside, the question, as to whether, the Chief Minister had the authority to convert a mining licence that too for period of thirty-years into a lease for industrial/residential/commercial purposes and that too for ninety-years or that, as to whether, such land could even otherwise be allotted/granted on account of its location being in the river bed or on account of safety risk is not before us, therefore, we would refrain to embark upon such controversy.”

11. As to the first order of the Accountability Court dated 11.4.2009 impugned in the instant petition, this Court on the first date of hearing i.e. 13.05.2009 at the request of petitioner passed the following orders: -

“Case of the petitioner is it has entered into an agreement of sale with regard to 1/3^rd of the property comprising 341.23 acres. The land then become subject matter of regularization under Section 5 of the Sindh Government Land (Cancellation of Allotments, Conversions and Exchange) Ordinance 2000. The matter was then referred to Regularization Committee which, on 6.12.2005 passed regularization order, but no challan was issued as one Suit bearing No.970 of 1997 was pending in this Court.

Learned counsel for the Petitioner states that subsequently Suit was withdrawn. The petitioner then filed a suit for specific performance of the contract against the allottee /owner, which is pending adjudication. He submits that the impugned order, if implemented, would cancel the allotment in favour of original allottee from whom the petitioner has purchased 1/3^rd of the land for valuable consideration and in this regard power of attorney has also been executed in favour of the petitioner. Though under Section 23-A of the NAB Ordinance, transfer during the pendency of the proceedings can be declared void, however, when the matter of regularization is in process, the NAB has to stay its hands. Petitioner on his part has shown its willingness to deposit 1/3^rd of the regularization charges within 6 weeks from today.

In the circumstances, no coercive action in relation to 1/3^rd of the land in question shall be taken pursuant to the order dated 11.4.2009 passed by Accountability Court No.II, Karachi, till the next date of hearing. The Petitioner shall also not create any third party interest in the 1/3^rd of the land on the basis of power of attorney that has been executed by the original allottee in its favour and shall deposit 1/3^rd of the regularization fee in this Court within six weeks. Issue notice to Respondents, D.A.G. and AAG for 28.5.2009.”

12. It appears that in consequent to the order of this Court, as reproduced above, the petitioner instead of depositing 1/3^rd of the regularization fee in this Court managed to obtain challan for the differential and after payment of Rs.59,031,200/- in the treasury on 08.03.2012 got a conveyance deed registered in its name on 19.4.2012.

13. The record reflects that the Petitioners were not only conscious of the fact that the Accountability Court had declared all transactions in respect of property subject matter of this petition as void but were also conscious of the fact that the subject land was cancelled by the Member Land Utilization on 07.08.1997 while exercising power under Section 164 of the West Pakistan Land Revenue Act, 1957 and that such order was unsuccessfully challenged on behalf of their predecessor-in-interest by filing Suit No. 970 of 1997 and Constitution Petition No.D-2088 of 2006, as they were party in Constitution Petition No.D-2601 of 2009 filed by one of the partners of M/s. Marina City Development disclosing all such details, despite Petitioners instead of depositing 1/3^rd differential amount of the subject land with the Nazir of this Court in terms of Order dated 13.05.2009 (reproduced above) managed to obtain challan and deposited the amount allegedly with the Government of Sindh and on 08.03.2012 got executed Sale Deed in respect of 1/3^rd undivided portion of the subject land.

14. The act of the Petitioners of getting Conveyance Deed executed in their names after knowing about the cancellation of grant on 07.08.1997 and further after the Accountability Court has declared all transfers in respect of property subject matter of this petition as void, was a conscious attempt to confer title upon themselves in defiance of order of Accountability Court which they had impugned by way of instant petition and of course in derogation with the order of this Court dated 13.05.2009 (reproduced above). In the circumstances, the Petitioners acquired so-called ownership by way of Conveyance Deed much after the impugned order was passed and after the Petitioners itself had challenged the order of Accountability Court by way of instant petition, therefore, cannot plead want of knowledge and such sale deed in defiance of order of Accountability Court has no value at all in the eyes of law. Though the Petitioners’ claims, that it entered into an agreement of sale with one of the partners viz. Seema Tressa Gill of M/s. Marina City Development on 02.06.2007 but such sale agreement or the execution of power of attorney cannot be termed sale in terms of Section 54 of the Transfer of Property Act. Additionally since the sale itself is questioned for want of title of petitioner’s predecessor in interest and is pending adjudication before the Court of original civil jurisdiction, therefore, we would restrain ourselves to express on this aspect. Beside, we have already held in the connected petition in respect of this very land wherein the Petitioner was also a party that since the subject land was cancelled on 07.08.1997 by the Land Utilization while exercising power under Section 164 of West Pakistan Land Revenue Act, 1967 which of course was a judicial order, therefore, there was no existing grant which could come to an end by virtue of Ordinance III of 2001 or could have been regularized under Section 5 of the Sindh Land (Cancellation of Allotment, Conversions and Exchange) Ordinance 2000. In the circumstances, even the impugned order becomes meaningless as it was passed assuming existing grant in favour of petitioners’ predecessor-in-interest which of-course is against the record, therefore, the plea of audi alteram partem becomes meaningless.

15. As to the plea of bonafide purchaser for valuable consideration raised by Mr. Rasheed A. Rizvi, learned counsel for the Petitioner, in our opinion such plea can be raised against the claim of third party, but not in cases where the vendor himself has no title at all, or the title of the vendor is defective and in the instant case the title of the Petitioner’s predecessor in interest was cancelled way back in the year 1987.

16. In view of what has been discussed above, since we have already come to the conclusion that the grant in respect of the property, subject matter of this petition, was cancelled by the Secretary, Land Utilization on 11.07.1997 by exercising powers under Section 164 of the West Pakistan Land Revenue Act, 1967, which order till date has not been set aside through a judicial order, therefore, neither there was any grant in existence at the time when Ordinance III of 2001 was promulgated nor there was anything to be revived under Section 5 of the Ordinance III of 2001, therefore, there could be no question of passing title on the basis of lease deed dated 04.08.1996 which had no legal value nor interest, therefore, could lawfully be transferred on the basis of such deed.

17. In the end we would like to record that after this petition was heard and reserved for judgment, the Petitioner moved an application for withdrawal of this petition but since by then in the connected petition bearing No. D-2601/2009 which was heard alongwith this petition and dismissed in open Court we had expressed ourselves as to the worth of title of the Petitioners’ predecessor-in-interest, which ultimately had an effect on Petitioners’ title of whatever worth, therefore, we while declining the withdrawal, dismissed this petition being misconceived.

JUDGE

Karachi,

21^st May 2013.