P L D 2003 Karachi 83 (PLP)

OFFICE OF THE SENIOR DEPUTY DISTRICT OFFICER (REVENUE) LAND To Mr./M/s. Pak Cold Storage (Pvt.) Ltd., Plot No. 1, Sheet No.K‑28‑C, Old Sabzi Mandi, Karachi. Subject: Cancellation/Forfeiting the Lease and Resumption of Plot No. 1 (Cold Storage), Old Sabzi Mandi. Your reply dated 22‑7‑2002 in response to this office Notice dated 17‑7‑2002 has been examined and found unsatisfactory. Under clause (3) of the lease agreement you were bound to pay the land rant year to year but you have failed to pay the same from 1978. You have thus violated the terms and conditions of the lease agreement, therefore, I Salman Akhtar Faridi, an authorised officer under section 142 read with Schedule VI, Item‑64‑1, 2, 3 of SLCO 2001 hereby cancel/forfeiting the lease of the plot and resume the same according to law and rules. (Sd.) (Salman Akhtar Faridi), Senior Dy. District Officer, (Revenue) Land, CDGK." First we will take up the contentions raised by the learned counsel of the respondents in support of the cancellation of the lease deeds. He has submitted that when a special and specific provision pertaining to the forfeiture of lease is contained in the lease deed, the procedure provided therein is to be adhered to, by the parties and the provisions contained in general law such as Transfer of Property Act shall not be applicable. Advancing his arguments he has submitted that in clause (3) of the lease deed it is specifically provided that, if at any time, any instalment of annual rent remain in arrears for a period of two years or over, the lessors shall be entitled to forfeit the lease and resume this plot. His contention is that, the land rent, was not paid by each of the petitioners for several years. When asked to show the procedure and manner in which the forfeiture of lease and resumption of plot shall take place, he was not able to show any such provisions. He placed reliance on section 142 of the Sindh Local Government Ordinance, 2001, which reads as follows: 'Notice and authorization.‑‑Each Nazim shall authorise an officer or officers under his administrative control. (a) to issue legal notices on behalf of the respective Administration for violation or commission of any offence under this Ordinance, rules or bye‑laws; (b) to take such measures and actions for compliance of directions contained in the notices issued restraining violation or commission of any offence under this Ordinance, rules or bye‑laws; and (c) to initiate legal proceedings, defend any legal proceedings initiated against the local government, attend Court proceedings and represent the concerned local government. " The learned counsel, however, conceded that section 142 of the Sindh Local Government Ordinance, 2001 mainly deals with the authorisation of an officer to issue notices on behalf of the administration and to take necessary measures and actions for compliance of the directions contained in the notices. We are persuaded to agree with his first leg of argument that when a lease of land has been executed it can be cancelled/forfeited in terms of lease deed only. We are fortified in this regard that the judgment of the Hon'ble Supreme Court in the case of Anjuman‑e‑Ahmadiya, Sargodha v. The Deputy Commissioner, Sargodha PLD 1966 SC 639, wherein it has been held as follows: "On completion of the purchase and execution of the conveyance the parties cease to be governed by any conditions incompatible with those actually incorporated in the instrument itself. Such a grant being a Crown gram is to be read, according to its tenor, any statute or law to the contrary notwithstanding. It is therefore, clear from the provisions contained in the statute and the conditions in the deed of conveyance that if there has been a valid grant then it cannot be cancelled in the manner in which the authorities have purported to do in the present case. The case was thus clearly one in which the appellant was complaining of a non performance of a public duty and asking for a direction that the authorities concerned should perform their public duty in accordance with law." The ratio of the above judgement was followed by the Hon'ble Supreme Court in the case of The Majlis‑i‑Intizamia, Jamia Masjid, Ghulam Muhammad Abad Colony, Lyallpur v. The Secretary to Government of West Pakistan, Communication and Works Department PLD 1975 SC 355, wherein it was held as follows: "The validity of the grant not being in question, it cannot be cancelled save as provided in the lease deed itself. Therefore, the appellant in this case properly invoked the writ jurisdiction of the High Court, complaining that after the execution of lease in its favour, the Secretary, Communication Department acted without lawful authority and that he cancelled the lease otherwise than as provided in the terms of the grant." Thus, accepting the contention of the learned counsel for the respondents that the leases in favour of the petitioners could be cancelled/forfeited in accordance with the conditions specified in the lease deed, his attention was drawn to clause (10) of the lease deed, which has already been reproduced in the earlier part of this judgment. As already observed, the learned counsel conceded that no Resolution has been passed determining the respective leases in favour of the petitioners as envisaged in clause (10) of the lease deeds. In view of this admitted fact, it is held that the respondents could forfeit/cancel the lease deed for the breach of condition pertaining to the payment of annual land rent in terms of clause (3) of the lease deed but in the manner specified in clause (10) and not otherwise. Since the procedure and manner provided in the lease deed itself has not been adhered to, therefore, the act of respondents cancelling the lease deeds is not in accordance with law and consequently unlawful and invalid. Now we take‑up the second contention that the notice dated 17‑7‑2002 and the cancellation/forfeiture of the lease and resumption of plots is in pursuance of section 142 of the Sindh Local Government Ordinance and Item No.64 (1) (2) (3) of the Sixth Schedule to the said Ordinance. So far section 142 is concerned, the learned counsel for the respondents has conceded that it deals with the authorisation of the officer only and has nothing to do with the authority or procedure/manner for the cancellation/forfeiture of the lease. As regards Item No.64, we find that sub paragraph (1) provides that, a local Government may grant a licence or lease in respect of any land, open space, building or property vested in it or managed, maintained or controlled by it on such terms and conditions as may be provided in bye‑laws. Thus, it is not relevant to the facts and circumstances of the present petitions. Subparagraph (3) provides as follows: "(3) If, on the cancellation of any lease or licence under, sub paragraph (2) or on the expiry of the period of any lease or licence or on the determination or cancellation of a lease or licence on the breach of any of the terms and conditions thereof in respect of land or building or any property of which a local government is the lessor or licensor, any lessee or licensee holds on or continues in possession of such land, building or property or if in any case such land or building or property is required for any public purpose, the lessee or licensee on being required to hand over vacant possession within a specified time refuses or fails to vacate that land or building or property, the local government or an officer authorised by it in this behalf may enter upon and take possession of such land, building or other property, and may also demolish and remove the structures, if any, erected or built thereon." A perusal of above sub‑paragraph (3) of Item No.64 shows that it shall come into operation when a lease or licence is validly cancelled under sub‑paragraph (2) of Item

64. However, if the cancellation of lease or licence is not valid in itself the consequences provided in sub‑paragraph (3) shall not be attracted. We would further like to observe that the respondents have acted in total disregard of all the provisions of law and principles of natural justice as well as 'the terms and conditions contained in the lease. Even according to the provision of sub‑paragraph (3) of Item 64 the lessee or licensee shall be required to deliver the vacant possession, within a specified time and if he refuses or fails to vacate that land or building or property, the local government or an officer authorised by it in this behalf may enter upon and take possession of such land, building or other property. In this case the lease has been cancelled/forfeited vide impugned order dated 19‑8‑2002 and the possession has been taken over immediately without service of any notice under sub‑paragraph (3) of Item 64 and expiry of the said period. This act is absolutely arbitrary and unwarranted in law. It goes without saying that any act which is arbitrary and unwarranted in law is by its very nature mala fide, illegal and unsustainable in law. Coming to the contention of the learned counsel for respondents that under sub‑paragraph (2), the concerned local government may after giving a reasonable notice to the person concerned, vary the terms and conditions of any lease or licence of land or buildings or any other property owned, managed, maintained or controlled by it, in such manner and to such extent, as it may deem fit, and may also cancel the lease or licence if the varied terms and conditions are not acceptable to the lessee or the licensee, we are of the opinion that the reliance on Resolution No.897, dated 7th of June 1999 with reference to sub‑paragraph (2) of Item 64 of the Sixth Schedule to the Sindh Local Government Ordinance, 2001 is totally misplaced and appears to be a result of non‑application of mind. First, for the reason that the Sindh Local Government Ordinance, 2001 has come into force on the 14th of August, 2001 as provided in section 1(3) of the said Ordinance. It has no retrospective effect and thus the Resolution passed on 7th June, 1999 is not in pursuance of the provisions contained in Item No.64, Schedule Six to the Sindh Local Government Ordinance, 2001. A perusal of the Resolution No.897, dated 7th June, 1999 shows that the land rent has been revised under Rule 15 (1) of the Sindh People's Local Council (Land) Rules, 1975 which reads as follows: "Rent and occupancy values how fixed.‑‑(1) The Council shall not less than thirty days before its budget meeting every fifth year, fix the rate of the rent payable in respect of the land/plots leased out under these conditions during the next five years commencing from 1st July next following." A perusal of the above rule shows that it authorises the Council to fix the rate and rent payable in respect of land and plots leased out under the Sindh People's Local Council (Land) Rules, 1975 during the next five years commencing from 1st July next following. Thus the rates revised under the Resolution are not applicable to the leases which were executed before the passing of "Resolution dated 7th June, 1999. A perusal of the petitions shows that the leases were executed on the following dates: Petition No. Date of Execution of Lease Deed C.P.No. 1445/2002 3rd November, 1998 C.P.No.1462/2002 14‑12‑1953 C.P.No.1474/2002 15‑4‑1993 C.P.No.1483/2002 1st September, 1975 C.P.No.1484/2002 13‑7‑1993 C.P.No.1490/2002 29‑2‑1958 C.P.No.1547/2002 9th March, 1976 C.P.No.1575/2002 26th December, 1970 As all the leases in favour of the petitioners herein, were executed before the passing of Resolution No.897 dated 7th of June, 1999, therefore, the revised land rent is not applicable to the leases in favour of the petitioners. It is also interesting to note that the rate of land rent required to be paid by the petitioners as shown in the show‑cause notices is as specified in the lease deeds and not in accordance with the revised/enhanced land rent in pursuance of the Resolution No.897, dated 7th of June, 1999, Moreover, the learned counsel for the respondents has candidly conceded that neither the petitioners were specifically asked to pay the revised land rent nor they refused to accept the same. Consequent, to the above discussion it is held that the recourse to sub‑paragraphs (1), (2) and (3) of Item No.64; Schedule Sixth of the Sindh Local Government Ordinance, 2001, referred to in the impugned notices dated 17‑7‑2002 and the cancellation orders dated 19‑8‑2002 are totally misplaced and are the result of non‑application of mind to the facts and law. The learned counsel for the respondents contended that the petitions are not maintainable as the petitioners could file appeal under section 190 of the Sindh Local Government Ordinance, 2001. According to him since the petitioners have failed to seek remedy which was available to them in law therefore, the petitions are not maintainable. We do not find any substance in the‑ contention of the reasons that, by now the proposition of law stands established that if an impugned order is palpably without jurisdiction the aggrieved person shall not be asked to have recourse to the forums available in the statute for the simple reason that an act without jurisdiction is void ab initio and consequently the aggrieved person shall be within his right to invoke the Constitutional jurisdiction of this Court. There is plethora of rulings by the Hon'ble Supreme Court on this issue and the proposition is so well embedded and established that we need not cite any judgment on this point. This brings us to the contentions raised by the learned advocates for the petitioners. They have contended that the lease is a bilateral agreement and cannot be cancelled unilaterally. They have contended that even an allotment cannot be cancelled bilaterally and without reasonable cause. They have further contended that the public functionaries are required to act reasonably and .in accordance with law. They have further submitted that if land is required for public purposes, to wit, development of a Park, it can be acquired under the provision of Land Acquisition Act, on payment of compensation as provided in the said Act and the vested right of the petitioners cannot be taken away without recourse to the provision of law. The learned advocates for the petitioners have submitted that the respondents lave neither adhered to the provision prescribed in the lease deeds itself, nor to, the filing of suit as envisaged under section 114 of the Transfer of Property Act. They have submitted that it has already been held by a Division Bench of this Court in the case of Haji Dawood & Co. (supra) that where a forfeiture has occurred due to non‑payment of rent the tenant has second chance to pay the rent as well as interest under section 114 of the Transfer of Property Act, which right has been denied to the petitioners by the respondents. We find substance in the contentions. The object of section 114 of Transfer of Property Act came for consideration before the Supreme Court of India, in the case of Pradyuman Kumar v. Virendra Goyal, (1969) 3 SCR 950, it was explained as follows: "The covenant of forfeiture for non‑payment of rent is regarded by the Courts as merely a clause for securing payment of rent, and unless the tenant has by his conduct disentitled himself to equitable relief the Courts grant relief against forfeiture of tenancy on the tenant paying the rent due, interest thereon and costs of the suit." The facts and circumstances in these petitions are that admittedly the respondents failed to issue challan for payment of land rent and all of a sudden came with the plea that the petitioners have failed to pay the land rent and therefore, their leases are liable to be forfeited for the non‑payment of the land rent. The learned Advocates for the petitioners have pointed out that the respondent No. 1 City District Government, Karachi, its predecessor, Karachi Metropolitan Corporation, and other such bodies like KDA have not issued challans for payment of land rent to almost all the lease holders in the City of Karachi. The challans have been issued for payment of other taxes and dues but the authorities concerned have totally ignored the recovery of and rent. Thus, the extreme action of forfeiture/cancellation of leases in few cases would not be reasonable and at the same time discriminatory. They have submitted that as soon as they received notices. All of them immediately sent cheques for payment of entire arrears of the land rent which shows that they were willing at all the times to pay the land rent. The learned counsel in C.P. No.D‑1462 of 2002 pointed out that the predecessor of respondent No. 1 issued challan for the tax year 1988‑89 under heads conservancy, fire rate and land rent. All the dues were duly paid. Thereafter for the years 1989‑90, 1990‑91 and 1991‑92 the challans were received for payment of the clues under the heads of conservancy and fire rate only while zoo amount was shown in the challans against the head land rent. The learned Advocates for the petitioners have submitted that the respondents were themselves negligent in collecting the land rent and therefore, they are not justified to take advantage of their own wrong. We find substance in the contentions. Although the lessee is not totally absolved of the responsibility of paying the land rent if challans have not been issued but looking to the consistent practice of depositing land rent and other due on receiving challans and inaction on the part of respondent No. 1 and other such authorities in the case of non‑payment of land rent, we are of the opinion that it would be unreasonable and discriminatory to cancel the lease deeds without giving a chance to pay the arrears of land rent. We further deprecate the arbitrary manner in which the respondents has taken over the possession of the plots. As already discussed if the respondents intended to forfeit/cancel the leases, they ought to have, adopted the procedure and manner provided in clause (10) of the lease deeds in majority of the leases in favour of the petitioners. Even if they were under the impression that the provision in Item No.64 (2) (3) is applicable they ought to have abided by the procedure prescribed therein. Third course open to them was to file a suit for possession, after the cancellation/forfeiture of the lease. Every person and particularly the public functionary and Civil Agencies are always expected to act reasonably and strictly in accordance with the provisions of law and the principles of natural justice. Any act done in colourable manner and tainted with arbitrariness and abuse of power is always mala fide and without jurisdiction, which is liable to be struck down. For the foregoing reasons, all the petitions are allowed and the orders cancelling the leases are hereby declared to be without jurisdiction, unlawful and void. The respondents are prohibited from resuming and taking over the possession of any land in the cases in which the possession has not been taken over so far and in the cases the possession has been taken over they are directed to immediately vacate the plots under consideration in these petitions and to restore the possession of the plots to the petitioners forthwith. They are further directed to de‑seal the subject properties immediately and allow the petitioners to enter into the plots and buildings. It is further directed that the respondents shall issue challans to the petitioners indicating the entire amount of land rent due giving an opportunity to the petitioners to pay the land rent within the period specified in the respective challans. The parties shall bear their own costs. M.B.A./P‑54/K Order accordingly.