2025 PLP 97 (YLR)

Abid Aziz Sheikh, J.

This consolidated order will also decided writ petitions mentioned in Appendix-A, as common questions of law and facts are raised in all these petitions. 2 In this and connected writ petitions, petitioners have inter alia challenged the auction advertisement, for the shops in question for the enhancement of rent. Relevant facts which are more or less common in all these petitions are that shops in question are owned by the Provincial Government, however, the same are being managed by the Local Government, which has leased out the said shops to the various occupants/ lessees. Through the impugned advertisements, the said shops are being advertised for lease through re-auction which is assailed through these constitutional petitions.

3. The main contention of petitioners side is that rent for the shops leased out by the Local Government can only be enhanced by following the procedure prescribed under section 94 of the Punjab Local Government Act, 2022 (Act) read with Punjab Local Government (Property) Rules, 2018 (Rules), according to which, there are different categories of lease; the first category is where there is valid lease agreement which has expired or about to be expired and it does contain the condition for extension. For such lease, under section 94(6) of the Act, lease can be extended after the fresh assessment is made by the Rent Assessment Committee (Committee). The second category is where there is no written lease agreement available but the occupant paying the relit for more than five years and in such cases, the Local Government may enter into written agreement with occupant for period not more than five years, after fresh assessment by the Rent Assessment Committee with 10% annual increase under section 96 (7) of the Act. The third situation is under section 96(8) of the Act where lessee and occupant failed to enter into agreement under above two categories and in such situation, the shops/property can be put to auction as prescribed in section 96(3) of the Act.

4. Learned counsel for the petitioners submit that almost all of these cases falls in second category, being no written lease agreement available but occupants paying rent for more than five years, therefore, unless the rent rate is assessed afresh by the Committee, shops cannot be put to auction as required under section 94(7) of the Act. The other contention of the petitioners is that power to re-auction under section 94 of the Act can only be exercised by the elected Local Government and not by the "Administrators" who can only carry out day today functions of local government. Submits that this legal position is also determined by this Court in Malik Mazhar Hussain Goraya v. Government of Punjab and others (PLD 2023 Lahore 257) and Writ Petition No.70681/2023 vide judgment dated 15.11.2023. Learned counsel further submits that in earlier round of litigation (by some other petitioners) in Writ Petition No.45176/ 2021, the undertaking was given by the then Chief Secretary, Government of Punjab, (recorded in order dated 28.7.2021), that unless transition plan of local government is submitted before the Court, the Administrators shall only carry out day today work and will not auction the lease property or enhanced the lease money. Submits that in pursuant to above undertaking, formal notification dated 29.7.2021 was also issued by the then Chief Secretary. However, admitted that said Writ Petition No.45176/2021 was finally disposed of vide order dated 11.11.2021, mainly for the reason that matter for implementation of Supreme Court judgment is pending before the Supreme Court. Learned counsel further submits that the policy notification dated 30.9.2019 was issued for the disposal of Estate or Nazool land of Provincial Government through sale and lease, however, said notification is not applicable to the shops in question being managed by the Local Government. 4.(sic) Learned Law Officer on the other hand submits that shops in question are admittedly in the ownership of the Provincial Government which is also shown in column of the ownership of the Revenue Record, however, said shops were managed by the Local Government, which had leased out these shops to the various occupants/lessees. He submits that Board of Revenue (BOR) under the Chairmanship of Senior Member, Board of Revenue held meeting on 30.11.2023 and inter alia decided as under:-

13. After detailed deliberations, the following decisions were made:- i. State land can only be disposed of according to the prevailing policy of the Government which has been issued under section 10 of the Colonization of Governments Lands Act, 1912. Further State land is administered under the Colonization of Government Lands Act, 1912 so State lands shall be auctioned as per policy 30.9.2019. ii. The lands which have been recorded as provincial government in the column of ownership of revenue record will be required to be dealt with under the Colonization of Governments Lands Act, 1912 and policies issued thereto, whereas the lands which have been incorporated as Local government entities in ownership column of revenue record are obligated to be processed under the PUNJAB LOCAL GOVERNMENT ACT, 2022 (Act XXXIII of 2022) read with Punjab Local Government Property Rules, 2018 and policy circulars issued thereunder.

5. Submits that in view of above decision of BOR, land in the ownership of the Provincial Government and also being shown same in the column of the ownership of the Revenue Record, shall be auctioned as per policy dated 30.9.2019 (Policy) issued under section 10 of the Colonization of Government Lands Act, 1912 (Act of 1912), whereas land which is in the ownership of local government entities in the ownership column of the Revenue Record, are to be governed under the provision of the Act and the Rules. He submits that because all these shops are in the ownership of Provincial Government in Revenue record, therefore, these shops are to be dealt with under the provisions of Act of 1912 and policy and not under the Act and Rules, therefore, the aforesaid judgments, notifications and undertakings are not applicable to the present cases after BOR decision dated 30.11.2023.

6. Learned Law Officer further submits that notwithstanding the above legal position, the majority of the writ petitioners have not only participated in the auction proceedings but have also become successful bidder and are retaining their shops, therefore, they are estopped by their conduct to challenge these auction proceedings. Learned counsel for the petitioners on the other hand submits that they have participated in the auction process under protest.

7. Heard. In view of above respective submissions made by learned counsel for the parties, the matter can be decided on merits either way, however, considering that most of the occupants/ lessees in these petitions have already participated in the impugned auction proceedings and have also been declared successful bidders and are retaining the shops, therefore, may agree with the fresh assessment of rent of the shops in question, the learned counsel for the parties on instructions agreed that without conceding their above respective factual and legal contentions, at the first instance, let relevant Committee under the policy to examine the cases of petitioners individually and in case, they agree with the enhanced rent as assessed, proceedings may be finalized to their extent. However, those petitioners to whom fresh assessment of rent is not acceptable, their cases may be decided through reasoned and speaking orders and those petitioners will be at liberty to challenge the said orders as well auction proceedings, if so advised before appropriate forums.

8. All these writ petitions are accordingly disposed of in above terms. The needful shall be done by the competent Authority expeditiously preferably within a period of three months from the date of receipt of certified copy of this order. However, till the matter is decided by the relevant Committee, neither petitioners shall be dispossessed from the shops in question nor their shops be sealed, provided they will regularly pay the assessed rent agreed by them in the auction proceedings. MQ/S-62/L Order accordingly.