(a) Land Reform Regulations, 1972 (M.L.R 115) Paras. 2(7)-& 8-Partnership Act (IX of 1932), S. 4-Person-Partnership firm-Stipulations contained in partnership deed showing intention of partners that they agreed to surrender their share of land to Management of Partnership only temporarily and for limited purpose of sharing profits and losses of Farms-Such partners, held, could not be attributed with intention of permanently divesting themselves of their right of ownership of land and ownership of partners over land remained intact-Partnership firm or Management thereof, could not be said to have become owner of said land only because it came under its control and management. (b) Partnership Act (IX of 1932) , Ss. 4, 5 & 6-Land Reforms Regulation 1972 (M. L. R. 115), Para. 2(7)-"Person"-"Partnership"-Attributes of partnership and position of Partnership/Firm in legal terms elaborated-Attributes of partnership stated.-[Words and phrases]. It does not emanate from Status ; it is the creation of agreement between individuals; it is a relation between individuals who have entered into agreement; its purpose is to share profits of a business; the individuals bound in relation of partnership are individually called partners and are collectively called a firm; its business must be carried on by all or any of the partners, acting for all ; and the name under which its business is carried on is called firm name. Partnership has no independent existence or personality separate from its members. It is just a collective name of group of individuals who have agreed to jointly own property and do business to share the profits. Its rights and liabilities are the rights and liabilities of the partners and are enforceable by or against them individually. Though a firm may possess some attributes of a personality, it is only a collective name of its members and is not a legal person or entity, distinct and separate from partners. A firm is not an entity or a `person' in law but is merely an association, only a compendious mode of designating the persons, who have agreed to carry on business in partnership. Although in mercantile usage a firm is deemed to have an existence distinct from the members composing it, the strictly legal view is that it is neither a legal entity nor is it a person. The members of partnership do not form collective whole distinct from the, individuals composing it, nor are they collectively endowed with any capacity of acquiring rights or incurring obligation. The rights and liabilities of a partnership are the rights and liabilities of the partners and are enforceable by and against them individually. Bai v. Abdul Aziz and others P L D 1968 Kar. 635; Dulichand v. L T. Commissioner, Nagpur A I R 1956 S C 354 ; S. T. Desai on Commentary on Partnership Act, 1956 Edn., p. 17 and O. P. Agerwala on Caleberated Work on the Indian Partnership Act ref. --Language of legislation admitting two constructions and if construed in one way leading to obvious injustice - Such result, held, not intended unless intention to bring it about had been manifested in plain words-Sense of possible injustice of an interpretation ought not to induce Courts to do violence to well-settled rules of construction but same may properly lead to selection of one rather than the other of two reasonable interpretations. Maxwell's Interpretation of Statutes 12th Edn., page 208 and Pakistan International Air Lines v. Sind Labour Court P L D 1980 S C 323 quoted. -- Para. 2(7)--Partnership Act (IX of 1932), S. 4-"Partnership" not covered by words "association or body of individuals"- Partnership is non-entity having no existence or responsibility separately from its members-Partnership has no rights or liabilities and all rights and liabilities relating to partnership are enforceable by or against its members individually.-[Words and phrases]. I. T. Commissioner v. S. Y. Angidi Chettiar A I R 1962 S C 970; B. D. M. C. Importers Group v. L T. C.-Cum-E. P. T. M. P. A I R 1957 Nag. 4 and Muhammad Noorulla v.
1. T. Commissioner A I R 1961 S C 1043 ref.
. Para. 4(3)-Press note issued by Sind Land Commission Vide Notification No. SLC-1/72/1272 dated 10th May, 1972-Clarification made by Sind Land Commission by such Press Note was nothing but an attempt on its part to give interpretation of word "person" Interpretation of provision was function of Courts and Provincial Land . Commission had no such powers-Press note, therefore, was not legally binding.-[Interpretation of statutes] -- Paras. 2(7), 8 & 13(3)-Partnership Act (IX of 1932), S. 4-"Partnership" not a "person"-Individual partner on one hand and firm as distinct from partner on the other hand could not simultaneously own a property-Partner on joining partnership was not divested of his ownership of property he gives under control and management of partnership--Restrictions contained in para. 8 of Regulation in owning of land beyond fixed ceiling and question of resuming . excess area of land, held, would not be applicable in case of partnership.-[Words and phrases]. An individual partner on one hand and the firm as distinct from that partner on the other cannot simultaneously own, a property. A partner on joining partnership is not divested of his ownership of the property he gives under the control and management of the partnership. That being so, the question of vesting of the ownership of the same property in the partnership or the management thereof would not arise. Thus, if "partnership" does not own any property, the restrictions contained in para. 8 of the Regulation on owning of the land beyond fixed ceiling and the question of resuming the excess area of the land would not be applicable in the case of partnership. Therefore, the word "person" used in the said para. 8 obviously does not cover 'partnership'. It is however true that para. 8 does not only refer to a person owning the land but also speaks of a person possessing the land. The question arises if partnership is in possession of the land surrendered by the partners for the purpose of joint cultivation. Assuming that the land which is the property of the partners when surrendered by them for joint cultivation comes under superintendence and management of the partnership, still by that reason partnership cannot be held to possess the said land on its own behalf. Its possession of the land cannot be in the nature of possession of a lessee or mortgagee. If the partnership is said to possess the land. its possession is on behalf and for the benefit of its partners unlike the possession of lessee or mortgagee which is clearly for the benefit of the latter. Even if the partnership is held 4s a `person' possessing the land, then as provided in para. 13(3) of the Regulation, the area in excess of the fixed limit in its possession will revert to its real owners namely partners. But that again is to be done when the excess area is possessed by a `person' for his own benefit. Otherwise co-operative effort of joint cultivation with all economic benefits flowing therefrom will receive a serious set back. Surely it cannot be the intention of the land reforms. In order to construe the word `person' in true perspective one cannot lose sight of the intention of the framers of the Land Reforms Regulation. The intention of this legislation is discernable from its preamble which clearly shows that the idea is to avoid concentration of wealth in a few hands and foster its equitable distribution and promote the lot of peasantry. Keeping the above ideal in view, the partnership cannot be held a `person' in whose hands the concentration of wealth is-to be discouraged. Partnership/firm is not a `person' either owning or possessing the land for the purpose of para. 8 of the Regulation. Although its sister organizations such as company or corporation find specific mention in the definition of `person', partnership is conspicuous by its omission from the said definition. The omission of partnership from the definition of a "person" is not without significance. The omission appears to be deliberate and intentional.
:.item' forn-I ct)flectit'e whole.disthtct from tire individuals eomrosin it nor are they collectivel e d w.. ed o with ' ti ls3 a c a t aG _ t ai.- Y .:. P ~'. , qu ring rights, ~ies` is' tti~~ partner-r jiiphas no inqqv .f..P.r. V a1tCy;separate.fram i:tsimenibers_I A,ts jusjt,a,oliect.iYe' -.a-zts:of:jroup; 0 indiMiduaiswhorhav&agreedto! jointy.:aW,n:ptoperty ..and.: do.: pus~ness,, t4;shar-&,pz0fits,-~ ' ' 1Joojesrarg.;;thg-;riAzs:;,and;,ligbilaes o~'t ' Its,; raghts andl .i0r. ). partam aad_al~rrf rceablp ;;~3r., ,,a,gain,S#;tlleftl;-rc~~iIte"R~ itiart;;7n~is4~ :. 7 . llt; :.ri h ,'r u,~:l t)j! ;OW Jj -izslsrx'~s n.,-, 5., a religious, edir`cational a! charitable institutiorx, xsJ-:,frrj;,Y~Y:;3tr?ust,,,Mietber public or private, a,Hindu undivided family, a cotnp~; ny- or` association or body of individuals, .044 ooper.ivt or other societ; . but does not ifclude a local authority, .a university established by lau', a? body incorporated'- by the'L6trA or provincial 1(ti) lfj98Ca~r.I635 (2) A' It 1 56 S 17"3 ;4''(3 ) law, or an educational institution, a livestock farm or a co-operative farming Society exempted by Federal Government from operation of the Regulation." It would be noticed that partnership/firm does not find mention in the above definition even though `company' has been expressly included and a body incorporated by central or provincial law has been specifically excluded. However, according to the learned counsel for the respondents `partnership' is covered by the words : association or body of individuals", used in above definition of `person' and consequently it is nothing but a person. He further submitted that while interpreting the definition of `person', construction as is manifested by plain words may be placed on it. In support of his argument he relied upon the passage from Maxwell's Interpretation of Statutes 12th Edition, page 208, as reproduced in Pakistan Internationai Air Lines v. hind Labour Court (1). It reads as follows : "A sense of possible injustice of an interpretation ought not to induce Judges to do violence to well-settled rules of construction but it may properly lead to the selection of one rather than the oiher of two reasonable interpretations. When the language of the legislation admits of two constructions and if construed in one way would lead to obvious injustice, the Courts act upon the view that such a resul could not have been intended unless the intention to bring it about has been manifested in plain words." There is no dispute with the proposition laid down in the above passage. The question however is whether partnership is "an association or body of individuals" as mentioned in the definition of `person'. The learned counsel for the official respondents expressed the view that partnership being an association or body of individuals is a person within the meaning of para. 2(7) of the Regulation. He built this argument on the strength of three Indian Authorities. In the first case of I. T. Commissioner v. S. V. Angidi Chettiar (2) it was held "A firm is manifestly a body of individuals and would, therefore, fall within definition of `person' ". The second case is reported as B. D. M. C. Importer's Group v. I. T. C.-Cum E. P. T. M. P. (3) wherein it was observed, "Suffice it to say that before any group of persons can be called an association of persons it must be established on facts that they are in the nature of partners i.e.x in our opinion the established facts of the case must at least lead to an inference that the members of the group of their volition or free will have joined in a venture with a view to earn profits." The third case is of Muhammad Noorulla v. I. T. Commissioner (4) wherein it was held : "The test there laid down was that as soon as there was election to retain the property and manage it as a joint venture, the persons so electing became an association of individuals." It would be noticed that above three authorities pertain to income-tax cases. In the Indian Income-tax Act the definition of "person" is materially different from that given in the Regulation. Moreover the Income-tax Act is a fiscal law. The object it seeks to achieve is entirely different from (1) PLD1980SC323 (2) AIR1962$C970 (3) A I R 1957 Nag. 4 (4) A I R 1961 S ,C 1043 that sought to be achieved under the Regulation. Accordiugly construction put on-the word `person' used in the Indian Income-tax Act cannot be helpful in interpreting the same word (i. e. person) used in the Regulation. The schemes of the two laws being totally different, the interpretation of the word "person" used in these laws cannot be the same. This is with regard to first mentioned case. So far other two cases are concerned, the facts and circumstances of these cases are distinguishable from the facts and circumstances of the present cases. Accordingly the views expressed in the reported cases cannot be applicable in the cases in hand. -Moreover as stated in the foregoing paragraphs, partnership cannot be held to be covered by words "association or body of individuals." As has beenl correctly argued by the learned counsel for the petitioners, the words "association or body of individuals" seem to have been borrowed from General Clauses Act wherein they are mentioned despite the knowledge that they are not applicable to partnership. It has been repeatedly held by the superior Courts that a firm is not a person as defined in the General Clauses Act. Even otherwise the above words relate to an association o .' body of individual which exists as such in legal sense. As for partnership, it is non-entity having no existence or personality separately from its members. It has no rights or liabilities. All rights and liabilities relating to partnership are enforceable by or against its members individually. Reference has also been made to press note issued by the Sind Land Commission as contained in its Notification No. SLC-1/72/1272, dated 10th May, 1972. It reads as under : . . . . . The Land Commission, Sind, is pleased to clarify for the information of all concerned that the definition of the word `person' as contained in the Regulation includes only such bodies or individuals as are separate legal entities, such as a firm, a Hindu undivided family, a society or an association with its bye-laws- etc., but it does not inciude members of a family (not being members of a Hindu undivided family), who may be owning shares in land or a holding, or the heirs of a deceased person who have not yet partitioned the estate of the deceased and taken possession of their respective shares. In the case of the latter two classes of persons, each individual will be deemed to be a person to be owning the share or area of land to which he is entitled." The clarification made by the Sind Land Commission by the above press note is nothing but an attempt on its part to give interpretation of the word "person". The question is whether the said commission was empowered to do so. Part 2 of the Regulation deals with constitution and powers of Land Commission. Para. 4(3) of the Regulation no doubt states K that "A commission of a province shall have all the powers necessary for the implementation of this Regulation within the province." We are doubtful if such power includes the power of interpreting any provision of the Regulation which is obviously the function of Courts. In our opinion the above press note is not legally binding. Assuming that it has a binding force, the learned counsel for the petitioners is correct in pointing out that it is self-contradictory. On one hand it lays down a correct principle inasmuch as that `person' includes only such bodies or individuals as are separate legal entities but on the other hand wrongly illustrates the said rule by mentioning "firm"-of one of such separate legal entities. As has been pointed out above `firm' is not an entity, nor, has it separate legal personality or existence apart from its members. In t 's connection weagsee:wi :~ - t:~" th the leai tsed-counsel for they -petitioners ~At.: ~~ otherwise we have,-, to Ioak- tar that' part- ;of the`-ifiGW6ft ai'ade ~it, above press note which lays down al, principle.' > We- "'lils1b ' a see with' 1t ` that illustration i' " given in the sa-me breaebv of Clrarific6fsbn eantiot b6 con- strued as a part. of-the principle: On''this: point the -learhed'Coun9ql" has placed reliance on two authotities nattiely Muhantmad Af z ahv. Corieftds's'iotteY, Lahore Division. (1)-and hkngnl Ntigpaw.RallWay Co.-Ltd:',:'Rutttrrc/'i" :Rigltii .. . .J, - r" rf. and others (2). DID 'In the case of -hlfihisi's' ~'fzai5'rt'vraS~eli(':=t`t" `If the laws (Continiiance sia Force) Order was de~ igned brthto preven i chaos and to establish an orderly Government with a legal sancttor behind it then it would be only logical to assume that to achieve this object it vested the tower of alteration of existing laws ir. the Supreme authority namely the President and co-equality-in the Clue! Adruinistrator of Martial Law and in no one else... ,it seeuas, tq ~A, therefore, that in promulgating these tvyo orders the M,fi~i~l~~ Administrator ZQne'$;`,~".'clearly, acted beyond his competence to the extent n' Il ' of repug a cy u~existing laws.' , __ _ :,~~.t,n yui'9;t~ c:on ..~ ,~ In the Indian case the Privy Council observed .:--. . ~;:' ::_::~tI ,z~~-rn=-:,:~ ~; ___ The.illustration does -not confer:upon a ceedit&~`a~ rltit" o~''i ivtdr interest, .,upon a.,debt, vehic#,,is :due to himy rwen,he;s.not,esttitled to such interest tinder an.y,pxoviaton of law;'..b ,.~k~pr-coin an-lyisttaxtq have tb`e effect of modifying the language of th.e, section-,.which , a,Tgne forms the enactment." --" ' ' Apart from .above;. _ ~~he ; atgun;ant p~f ; :the . ,leaned. counsel' :for the ~etauo"ters that an.dividup f,partner ou vne,,h~indt ;the., firm .as..,distinct from ;thai partiier~ on tltc other "cannot simuftaneo`uslyown~a property, has a lot of force in it. The legal position of partnership is so clear than it does not admit of any controversy on the point that a partner on Joining partnership is not divested of his ownership of the property he. gives under the control and management of the partnership. That being so, the question of vesting of the ownership of the same property in the partnersbip~, o,r: the management thereof would not arise. Thus, if "partnership" doers riot own ary property, the restrictions contained in para. S , of the Regulation on owning of the land beyond fixed ceiling and the question of resuming the excess area of the land would not he applica.blc in the case .of partnership:- Therefaee, the Word' "person'.' used in : the aaid para. 8 obviously does not -eover:`partnership'. It is however: true?-,that para~ 8 oes not only refer to a person: owning the land but also speaks of ~a persbri .. ossescn ~ io.t the n ar' 'eland. Th : ue~ s ' ` rt g e q t .ti rl panership .is id; po3sessiort n'f the land surrendered by' the; partners for the:purpose of:joint cultivation.. Assuming that the land: which :is the :-property of the :partners' when surrendered. by them for` joint cultivation_comes.under superintendence And ' anagement of the partnership, - still _ by that,-reason..,. partnership s_ cannot The held to -possess the.. said land on its own behalf. :Its. possessidn of-the land cannot .be in -the nature of possession of: ra: ; , lessee --IM,,-mortgagee.., Jf the partnership is said--to possess, the land; :.its:posses ian; is~on.behalf And for the benefit of itspattners-unlike"the possess%on.of-lessee =orr:isortgagee which: is clean"y for the .benefit .of the aatten'. Even'if:thcpartnersship`is held as a-`person' possessing the tand'~:tbdn;as provided in: Para,' .133) ':.of the'-Regislatiots, the -aeea~ia 4teessibf tl:fixer; limit~t itirs-itar..~ossessi~: f;Il (1) P t, D ~t963 S c"Afi1` . .. .-;~.,;N. t~::; i;~;),:A;h'R 19:58 1' C 67t;=a~ revert to `its real owners namely; partnegs, : $ut -.-that again is ,to::be done, when the excess area is possessed by a `person',for his own .benefit, .. Otherwise, as in the instant case, co-operative effort of joint cultivation with all' econotnicbtnefits flbwiiig;'theceffosrivwill rec6l~ve~=serious` set back.' ~- Surely it cannot be the, iritenxion' of the land reforms. v=In ~ order - to construe the word `petsriis' '-its- trite ;perspecti4e- we canhbt lose=sight of the intention of the framers of ~.~he Latrd --Reforms. Regitlatiors.~- The intention o this le illation is -discerifablo 'from' ' its 'reamble tvhiCh clearly shows that the g .i idea i's'to- avoid coiicentiatiiYn `of wealth' in -a yfew ha'ads and ';fost'er its equitable distribution and promote ffie `'lot of peasantry. Keeping the! above: ideal in,yiew, the partnership cannot be held.as aw'person' .,in-. .whose~ hands-the conceptratim o wealth, is to be discouraged. ..:-, .~J s`.~Forthe above reasons we have come -to an irresistible. ~ cottelttsiori that Oaxthefshipr` firm is not"a-"person" either awning or possessiisg'.the land= for tti8:pucpose of-pAra:. 8 of the Regulation. 'Althougtt-its sister..organ'izations such' as ' cornpatiy ' c3r corporation find specific `m$ntion in the .definition of~ ":person";`partnetsfiip is,EOnspicuous by its omission from the said defini-I tion: - ale` ate. of the 'considered view r'tliat he omission of partnership from the definition of a llp'erson"v is not without significance. The omission appears to us to be deliberate and intentional ' As both the petitions ar to succeed on.the above grounds, we need not go into the question of abatement of these cases which were said to be pending at the time of the promulgation of the land Reforms Act, 1977. Accordingly we allow both petitions with no order as to costs, declaring the impugned order dated 25-8-1981 passed by Member, Federal Land Commission (Mr. Amir Uusuf Ali Khan) to be without any .lawful authority and of no legal consequence.' quence.' on cati:,_n_TI9V& 'f)az9vbs Vu 1 bsitss6 bstl ~i3nistg 1y:a ,. ., s.v. M. z. M. ~. ~`d D[t?Ut f~85.:-:K,araola~ -.9~ ::;:. f ,.:~.T:~.,~~~ .4F s<~n~t~t,~ Before Aj ial Mia>Y dnt1 Taniit=ut-Rehma4; 1i ' ~- -'~ =~~~;s=~~' MUHAMMAD IBRAHIM T'aROUCM=arms -LBGn1,-H$tR3--:'I tTD 00 Xd b:alil ets btt3oo Do sv~ . versus _.tss:it s'~~r~. . ,>__:_:;;.~~> SIND INDUSTRIAL TRADING ESTATE LTD. XNn 3 _ dT13ittsl"~ . ~' Respondents - , - Litters Patent Appeal Nn. 208 of 1968, ~eci~ed>,"ptn~~t t4-ol'e.~~r. 1984 - , : :. -I t)Rl d~,W; Co fe N of 1908I-? , ;. . ,. , .. .a . . : .j ~z'iali~ -- O. XX, r. 1-High Court ..(Lahore) a Rules ;and Orders., .VQLNF. grit Chap. IV-F, r. 5-Judgment could not become, invalid merely, fob the reasons that same was givens after expiry, of several months from "date of he aritg'of arguments-No time for pronouncing judgment was prescribed-Party, if could manifest that on .account of inordinate-v'~F delay in pronouncement of judgment' ,Court concerned had overlooked material pieces of evidence/arguments, that may be a ground for setting aside judgment-Case having voluminous evidence, oral as well documentary, some delay, held, was explainable on face of it-Desirability of delivering judgment without any inordinate delay so that justiee.must not only be done but must manifestly -appear to .. m be done stressed.-(Judgmantl. gyp. 102];4 separate legal personality or existence apart from its members. In,t~is connection we agreemith the learned"counsel'fbr tfie~ p4iti6hets! fiat eii otherwise we have. to=loop to ~ tha* part-'=bf the`-~Idfiiicatlof ni'ade,1h ~fl above .press note which lays-down a' principle. We -'also- ,'a~ree`ivi'tlt him that illustration given in Ahe same breach' of blarifieationscaniintbd cottstrued as a part. of- the principle. On. this point the learned-`coun~ei' bfas placed reliance on twoauthorities namely~.3': _.. 3 r _.:!f:r,icl~.;t t t :.lr;;. o ~Jti th.t V~iCis,i s,:.tili,i ':i'I ~ai~ -~'- In the case of -Mi
