2008 PLP 761 (CLD)

MRS. QAISER IQBAL, J.

By this common judgment we proposed to dispose of 1st Appeals Nos. 68, 69, 70, 71, 72, 73 and 79 of 2006 arising out of the impugned order dated 19-8-2006 passed by Incharge Judge of learned Banking Court No.III, Karachi in Execution Application No. 1 of 2005 filed in suit No.73 of 2003 whereby the appellants were directed to vacate premises in their occupation bearing G/1, G/2, G-3, 1/3 bearing No. RB-9/20, D.S. No.III-A-187, Ramchard Karamchand Building, Arambagh Quarters, Karachi being statutory tenants were protected under the law.

2. The facts leading to the appeals are that the respondent No. 1 filed suit for recovery of a sum of Rs. 73,10,144 with a mark-up succeeded in obtaining a decree for the sale of the mortgage property, consequent thereupon filed Execution Application No. 1 of 2005, the property was put to auction. The respondent No. 5, who is brother-in-law of real brother of the husband of the respondent No.4. (Landlady) offered Rs.50,00,000 with vacant possession.

3. In the meanwhile another brother of the husband of the respondent No. 5 participated in auction moved an application for release of the property in terms, of Order XXI, Rule 58, C.P.C. as the same was orally gifted earlier by the respondent No. 5 in favour of Muhammad Tasleem, Muhamad Fareed and Muhammad Aziz through registered gift Deed, However, entire mortgaged property was leased on Pugri basis to various, tenants including appellants.

4. The appellants being bona fide and lawful tenant acquired the disputed premises on lease by making payment of huge Pugri in the year 1998. Upon receiving the information regarding the auction of the subject property having been purchased by respondent No. 5 being close relative of previous owner respondent No. 4 resorted to move an application under Order XXI, Rule 58, C.P.C. read with sections 15 and 19 of Financial Institutions (Recovery of Finances) Ordinance, 2001 (hereinafter referred to as the Ordinance, 2001) i.e. rights of the tenants being protected, the appellants enjoying legitimate right to continue with, the possession and occupation of the premises.

5. That during the course of proceedings two tenants offered of Rs. 51,00.000 without prejudice to their rights of tenants on Pugri basis sought time to deposit amount which was declined. The learned Incharge Judge of the Banking Court passed the impugned order, whereby two tenants were directed to be ejected while in respect of other tenants it was held that they did not fall on the auction properties and sale in favour of respondent No. 5 was confirmed, hence this appeal.

6. Mr. Raja Qasit Nawaz learned counsel for appellants has contended that the learned Judge, Banking Court did not consider the documentary proof of the please raised by the appellants urged in holding that the tenancy of Ijaz Ahmed, Jawed Iqbal, Muhammad Saeed and Dr. Aziz Khan Tank in respect of some other areas over the Plot No. RB- 9/20 had no concern with the property auctioned is ex facie wrong as they all have been paying rent to respondent No. 4 (Landlady) earlier to her predecessor in respect of subject property.

7. It is urged that the tenancy of Messrs Climax Printers hearing No. G-2 and S-6 at portion of G-2 tenancy of Muhammad Anwar bearing No. G-1 at ground floor, tenancy of Javed Iqbal bearing No. S-1, S-7 are situated in at G/2 ground floor, tenancy of Ali Ijaz bearing No.S.-4/5 are situated over portion of G/3, tenancy of Fakir Hussain bearing No.S-3 situated portion of G/3 and tenancy of Muhammad Saeed bearing No.S-2 are located on portion of G/3 while tenancy of Memon Hospital bearing No. F-1 at G-1A, 1/3 over first floor on property bearing No. RB-9/20, (D.S. No.III-A-187), Ramchand Karamchand Building, Arambagh Quarters, Karachi therefore, the orders ex facie were null and void.

8. It is next urged that it was within the prior knowledge of the Bank that the disputed premises was .equitably mortgaged occupied by the tenants who were regularly paying rent being statutory tenants fully protected within the purview of Sindh Rented Premises Ordinance 1379 as laid down in Mst. Zarina Khawaja and others v. Agha Mehboob Shah PLD 1988 SC 190 on the basis of the valuation certificate dated 20-2-2002 of Messrs Saleh Saleem Associates the rights of the tenants were protected.

9. That on behalf of the respondent No. 1 the above position was contested, whereas the learned counsel for respondent No.5 Mr. Muhammad Yaseen Azad has invited our attention to the plethora of the judgments suggest that after confirmation of sale in the auction proceedings and registration of conveyance Deed in favour of respondent No.5 the matter cannot be reopened, only remedy available to the appellant in terms of section 15(6) of Financial Institutions (Recovery of Finances) Ordinance, 2001 as per proviso the Banking Court may not order eviction of a person who is in occupation of mortgaged property under a bona fide lease except on expiry of the period of the lease or on payment of such compensation as may be agreed between the parties or as may be determined to be reasonable by the Banking Court.

10. The reading of the above provision would show that the Banking Court or an auction purchaser would be put in possession of the mortgaged property under the Ordinance, 2001 subject to determination of the compensation as may be agreed by the parties or reasonably determined by the Court. The learned counsel for appellants contended that a tenant enjoys independent legal right and cannot be treated as a person acting on behalf of the landlord. The legislative intent could not be construed to deprive tenants of their rights to occupy property guaranteed under the law as held in case of Mst. Mubarak Shah v. Banking Court No.III 2005 CLD 515.

11. It is well settled law that a statutory tenant has a right to remain on premises and no one can dispossess him unless and until ejected without due process of law. This view finds support from the case of M. Ghana v. M. A. Mullick and others 1973 SCMR 90 and Mst. Zarina Khawaja and others v. Agha Mehboob Shah PLD 1988 SC

190. On bare perusal of section 15(6) of Finance Ordinance, 2001 a banking Court or an auction-purchaser cannot be put into possession of the mortgaged property in absence of any explicit provision the legislative intent could not be construed to deprive tenants of their rights to occupy the property guaranteed under the law in presence of documentary evidence confirming their status. In view of the above, Ist Appeals Nos. 68, 69, 70, 71, 72, 73 and 79 of 2006 are allowed and impugned order hereby stands set aside to the extent of handing over possession of the disputed tenements of the building by the appellants to the auction-purchaser. C.M.A. No.484 of 2007 Mr. Sadaruddin Huda learned counsel for Bank has prayed that a sum of Rs. 82,80,793 recovered out of the sale of the mortgaged property is lying with the Banking Court which could not be disbursed on account of the stay operating in the appeal in violation of section 22 subsection (3) of the Financial Institutions (Recovery of Finances) Ordinance, 2001 clearly indicates that no stay order can be granted unless decree holder has given an opportunity' of being heard and unless appellant deposit in cash the decretal amount. Since the appeals filed by the appellants have been allowed in above terms therefore, the stay order automatically stands vacated, the respondent-Bank may resort to the proper forum for redress. Application is accordingly dismissed. S.A.K/C-3/K Order accordingly.