P L D 1970 Karachi 752 (PLP)

3. In November 1959 the petitioner applied to the Deputy Settlement Commissioner that the balance amount of Rs. 83,027‑14‑0 may be realised from the deferred payment of his verified claim in Schedule VI and that the earnest money of Rs. 5,000.00 long with the amount of first instalment be refunded to him. This application was allowed as prayed. However when the petitioner later sought to recover the unutilised balance amount of his deferred payment in Schedule VI he was informed through the impugned order that the order of the Deputy Settlement Commissioner, by which the purchase price of the building was allowed to be adjusted from his Schedule VI to the extent of 40;0, was illegal to the extent of 30 YO and therefore he should pay the balance purchase price. Being aggrieved of this order the petitioner filed Writ Petition No. 895/1963 in this Court which he later withdrew so that he could reagitate the matter before the Department. After the withdrawal of the Writ Petition the petitioner filed proceedings before the Chief Settlement Commissioner but they were rejected by order dated 26‑6‑1968.

4. Mr. Ishaq Ahmad, the learned counsel for the petitioner contended that the order of the Deputy Settlement Commissioner dated 3‑1 i‑1959 was legal in that it was passed strictly according to the provisions of section 12(1)(b) of the Settlement Act. His grievance is that upon an erroneous view of the law his order was set aside by the Chief Settlement Commissioner. Elaborating his contention, the learned counsel argued that prior to 3‑11‑1959 the law in regard to payment of compensation from rent pool was provided in section 5 of the Settlement Act but in view of the proviso appearing under subsection (3) of that section no payment was allowed from rent pool against Schedule VI of the verified claim of a claimant. However this proviso was deleted by Act LIII of 1959 and consequently the rules in regard to payment of compensation against Schedules I, II and III of the verified claims were attracted to payments from rent pool as well against Schedule VI. This position is controverted by the learned counsel for the Department on two grounds : Firstly that section 5 of the Act deals with payments of cash compensation out of rent pool and not with the question as to how the purchase price of property acquired from com pensation pool, constituted under section 4 of the Act, would be paid by or adjusted on account of the holder of a verified claim. And secondly that deletion of the proviso by Act LIII of 1959 would not advance the cases of the petitioner even if it is assumed that section 5 of the Act was applicable. In order to appreciate the rival contentions of the parties section 5 of the Act, in relevant parts, may be reproduced "

5. Rent pool,‑(1) For the purpose of payment of com pensation to claimants in respect of unrealized rent of or income from immovable property other than agricultural land left in India, a rent pool consisting of following shall, subject to the provisions of subsection (2), be constituted, namely (3) The rent pool constituted under subsection (1) shall be utilised in such manner as may be prescribed Provided that a flat rate shall be prescribed payment of compensation from the rent pool."

5. The object of section 5, just like section 4 of the Act by which a separate compensation pool was created, was to create a rent pool which, in terms of subsection (3) thereof, was to be "utilized in such manner as may be prescribed" The object of the proviso, appearing under subsection (3), was no more than this that when compensation was to be paid out of the rent pool, it had to be on a fiat rate. In other words before the proviso could be invoked it must be shown that the manner in which the rent pool was to be utilised had been prescribed as required by subsection (3) of section 5 of the Act. This being the plain interpretation of the various provisions of section 5 of the Act, I have not been able to subscribe to the contention of the learned counsel for the petitioner that by the deletion of the proviso in question, by Act LIII of 1959, the rules in regard to payment out of compensation pool, con stituted under section 4 of the Act, would be automatically attracted to Schedule VI ceases so as to entitle the claim holders to payment out of the rent pool. Another reason in support of this contention is that the word "prescribed" has been defined in section 2 (7) of the Act to mean "prescribed by rules made under this Act". Mr. Ishaq Ahmad, the learned counsel admitted that the relevant j rules in regard to payment of compensation out of rent pool came into force for the first time on 23‑1‑

62. If this be so then the order of the Deputy Settlement Commissioner, dated 3‑11‑1959, would be without jurisdiction. Reliance upon section 12(1)(b) of the Act also does not help the petitioner. This section is entitled "determination of the amount of compensation" and proceeds to mention the manner in which the compensation of a claimant has to be determined. Subsection (a) of this section provides for the determination of the amount of public dues, of the nature described in sub‑clauses (a) and (b) of clause (10) of section 2 of the Act and in other sub‑clauses thereof, which would be recoverable from an applicant claim‑holder. Then comes sub‑clause (b) and since reliance has been placed upon this clause it may be reproduced "

12. Determination of the amount of compensation.‑On receipt of an application under section 11:, the authority concerned shall, after making enquiry in the prescribed manner, (a) .. (b) ascertain the amount of compensation to which the applicant is entitled, separately under the compensation pool and the rent pool, having due regard to the prescribed scales of compensation, the nature and value of his verified claim and other circumstances of the case." It would be seen that all that this clause provides is the ascertainment of the amount of compensation to which an applicant would be entitled separately under the compensation pool and the rent pool according to the prescribed scale of compensation. However, this would not mean that any payment could be made out of the rent pool without the existence of c rules which admittedly came into force after the order of the Deputy Settlement Commissioner dated 3‑11‑1959. In my view tile position would be the same in regard to the adjustment of the sale price of the property against Schedule VI as in substance it would amount to payment out of the rent pool. The fact that this is how the Department also understood to be the case is manifested by the Press‑note of the Chief Settlement Commissioner dated 10‑11‑1959 in which it is mentioned that no rules had been framed in regard to payments out of the rent pool.

7. Mr. Ishaq Ahmed next contended that the petitioner would, in any case, be entitled to payment from the rent pool at the rate of 25 % and in support he referred to the Departmental Memorandum dated 19/23‑5‑1961 appearing at page 597 of the Manual of Settlement Law and Procedure. This Memorandum is entitled "utilization of Schedule VI of an associating claimant by the transferee of any acquired evacuee property" acid proceeds to record that it had come to the notice of the Department that wrong adjustments of public dues against Schedule VI of claimants are being allowed by the Deputy Settlement Commissioner and further that instructions issued by the plead Office, from time to time, are not studied, while deciding such cases. After recording these observations the Memorandum lays down the instructions as to how such cases should be decided. In these instructions it is provided that a transferee of a property can utilize the amount under Schedule VI of the associating claimant up to the maximum of 25 0 of the verified amount. Arid it is this instruction upon which the petitioner relies. By reading the instructions as a whole the contention of the learned counsel for the petitioner appears to be misconceived. In the first place the principal object of the Memorandum is the recovery of the public dues and not the interest of a claimant. And in the second place these instructions would only apply if the holder of Schedule VI is the transferee of property from the compensation pool, constituted under section 4 of the Act and is liable to pay public dues. Apart from this limited function there is nothing in the instructions to entitle a claimant to claim payment out of the rent pool. Not only this but in my view the instructions in question could not have possibly provided for payment out of the rent pool as this subject was to be dealt with by the rules framed under sub section (3) of section 5 of the Act.

8. Mr. Ishaq Ahmad however contended that the above Memorandum no doubt mentions the recovery of public dues but this expression was wide enough to include the balance price of the property which the petitioner had purchased from the Department and which was still to be paid. In support of this contention the learned counsel referred to section 2(10)(d) of the Act in which the expression "public dues" has been defined. The contention is misconceived. The clause in question refers to those public dues which are recoverable on account of the transfer of evacuee property by the Central or Provincial Government. Admittedly these transfers are made not un.dwr8 the provisions of the Settlement Act but under section 25(2)(s) of the Act XII of 1957.

9. In view of this discussion it is clear that th3 order that the Deputy Settlement Commissioner dated 3‑11‑195,9 was wholly without jurisdiction and therefore when the mistake was discovered the learned Chief Settlement Commissioner rightly set aside. Under the circumstances I find no force in this Petition which is dismissed with costs. S. A. H. Petition dismissed.