P L D 2001 Supreme Court 449 (PLP)

JAVED IQBAL, J.‑‑‑The above appeal arises out of the judgment, dated 8‑5‑1993 of the Lahore High Court, Lahore, whereby revision petition filed by respondents was allowed by setting aside the concurrent findings of the two Courts below in favour of appellants whose suit was also dismissed.

2. Leave was granted by this Court vide order, dated 29‑1‑1995 which is reproduced hereinbelow for ready reference to appreciate the . legal and factual aspects of the controversy. "Leave to appeal is sought against judgment and decree, dated 8‑5‑1993 of the Lahore High Court whereby Civil Revision No.207/D of 1991 filed by Faqir Muhammad, predecessor‑in- interest of the respondents was allowed.

2. The petitioners instituted suit for specific performance o agreement dated 23‑5‑1972 against Mst. Ulfat Bibi on 27‑5‑1982 in respect of he lane measuring 53 Kanals, 19 Marlas situated in Chak No.295/JB, Tehsil and District Toba Tek Singh. The learned trial Court, vide judgment, dated 9‑3‑1998, decreed the suit. On appeal filed by Faqir Muhammad, the District Judge, Toba Tek Singh, vide judgment and decree, dated 23‑12‑1990, dismissing the appeal. On revision filed by Faqir Muhammad, the learned Single Judge of the Lahore High Court allowed the same, vide impugned judgment referred to above and dismissed the suit.

3. Learned counsel .for petitioners contended that principle of lis pendens under section 52 of Transfer of Property Act , was incorrectly applied by the High Court in view of the fact that in the agreement,, dated 23‑5‑1972 (Exh.Pl) it has specifically been mentioned that oral agreement for sale of the property in question had taken place 5/6 years earlier and a sum of Rs.10,000 as token money had already been paid. It was further contended that the High Court had misread the contents of plaint as also the evidence on record to hold that Mst. Ulfat Bibi had already sold 25 Kanals, 12 Marlas of land in Chak No.295/JB and that her holding was reduced to one Kanal of land. It was submitted that she was still owner of 17 Kanals of land in the aforesaid Chak besides being owner of land in other villages. The contentions raised highlighted above need consideration, Leave to appeal is, therefore, granted."

3. We have heard Ch. Muhammad Hassan learned A.S.C. on behalf of the appellants. The entire record has been perused with eminent assistance of learned counsel. The impugned judgment has also been examined.

4. The moot question on which leave was granted in this case is as to whether the principle of lis pendens as enumerated in section 52 of the Transfer of Property Act, 1882, was incorrectly applied by the Lahore High Court in view of the fact that in the agreement, dated 23‑5‑1972 (Exh.P./1) a specific mention has been made that oral agreement for sale of the property in question had taken place 5/6 years earlier and an amount of Rs.10,000 was paid as token money.

5. From the perusal of impugned judgment it reveals that the revision petition preferred on behalf of respondents was mainly accepted on the principle of lis pendens as mentioned in section 52 of the Transfer of Property Act, 1882, with the following observations: "It has been seen that in the previous suit which was decided by this Court's judgment, dated 1‑2‑1982 (Exh.P.2) the parties were Mst.Ulfat Bibi and Faqir Muhammad and the dispute resolved by that judgment was that Mst. Ulfat Bibi was not the full owner of the land held by her including the land in suit and that her share was 1/3rd. Admittedly a stay order made by this Court during the pendency of appeal was in operation when the agreement of sale Exh.P.l was executed on 23‑5‑1972 by Mst. Ulfat Bibi in favour of Rana Abdul Sattar Khan. The agreement itself mentioned the stay order as also the fact of the pendency of the litigation between Mst. Ulfat Bibi and Faqir Muhammad. In these facts, even if there were no stay order in operation, the doctrine of lis pendens as enacted in section 52 of the Transfer of Property Act applied. That section says that during the pendency of any suit or proceeding which is not collusive and in which any right to immovable property is directly and specifically in question, the property 'cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect the rights of any other party thereto under any decree or order which may be made therein; except under the authority of the Court and on such terms as it may impose.' It was nobody's case that that suit was collusive between Mst. Ulfat Bibi and Faqir Muhammad. The property now in question was the subject‑matter of that suit and right to it was directly and specifically in question. It was said that what section 52 prohibits is a transfer but here there was only an agreement to transfer. This contention ignores the significant words 'or otherwise dealt with' in the expression 'the property cannot be transferred or otherwise dealt with'. There can be no doubt that by entering into the agreement of sale, dated 23‑5‑1972, Mst. Ulfat Bibi was dealing with the property in suit. I am, therefore, of the opinion that the agreement is within the expression 'otherwise dealt with'."

6. We intend to dilate upon and discuss the principle of lis pendens first as the impugned judgment revolves around It. The principle of lis pendens contained in section 52 of the Act is reproduced hereinbelow: "

52. Transfer of property pending suit relating thereto.‑‑During the pendency in any Court having authority in Pakistan or established beyond the limits of Pakistan by the Federal Government, of any suit or proceeding which is not collusive and in which any right to immovable property is directly and specially in question, the property cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect the rights of any other party thereto under any decree or order which may be made therein, except under the authority of the Court and on such terms as it may impose. Explanation.‑‑‑For the purpose of this section, the pendency of a suit or proceeding shall be deemed to commence from the date of the presentation of the plaint or the institution of the proceeding in a Court of competent jurisdiction, and to continue until the suit or proceeding has been disposed of by final decree or order and complete satisfaction or discharge of such decree or order has been obtained, or has become unobtainable by reason of the expiration of any period of limitation prescribed for the execution thereof by any law for the time being in force. " No scholarly interpretation of the said section would be required as the language employed therein seems to be free from any ambiguity which is capable enough to meet all sorts of such eventualities and lays down that during the pendency of any suit or proceeding in any Court in which any right to the immovable property is directly and specifically in question, the property cannot be transferred or otherwise dealt with by any party to the suit or proceedings so as to affect the right of any other party thereto under any decree or order which may be made therein, except under the authority of the Court and on such terms and conditions as may be stipulated. The doctrine of lis pendens was also discussed in case titled Hiranaya Bhusan v. Gouri Dutt (AIR (30) 1943 Calcutta 227) with the following main observations:‑‑ "The requirements of section 52 are:(1) the pendency of a suit, (2) non‑collusive character of the suit, (3) any right to immovable property being in question in that suit,. being in question directly and specifically, (4) the other party (other than the party making the transfer pendente lite) having some right under the decree in that suit. The doctrine with which section 52 is concerned rests upon the foundation that it would plainly, be impossible that any action or suit could be brought to a successful termination, if alienations pendente lite were permitted to prevail. The correct mode of stating the doctrine is that 'pendente lite neither party to the litigation can alienate the property in dispute so as to affect his opponent'. During a litigation nothing new should be introduced‑‑‑Pendente lite nihil innovetur: (1857) 1 De. G & J 566 (Per Turner, L J) and 29 All. 339 (PC) rel. on. The consequence of the doctrine of lis pendens is that the transaction pendente lite shall not be allowed to affect the right under the decree. As section 52 stands it is immaterial how the decree is obtained in that suit, whether after contest or by consent. It is also immaterial whether the decree in that suit is right or wrong. It is beyond the competence of the Court invited to apply the doctrine of lis pendens to sit in judgment on the previous decree. The principle of lis pendens applies though the right claimed in the suit was not the right given by the decree; (22) 9 AIR 1922 Cal. 358 rel. on. " The scope and object of the doctrine of lis pendens was also discussed in case titled T. Bhup Narain Singh v. Nawab Singh (AIR 1957 Patna 729) wherein it was held as follows:‑‑ "The doctrine of lis pendens is enacted in section 51 of the Transfer of Property Act. This section is an expression of the principle of the maxim 'ut lite pendente nihil innoveture', which means, that pending litigation nothing new should be introduced, and provides that pendente cite, neither party to the litigation, in which any right to immovable property is in question, can alienate or otherwise deal with such property so as to affect his opponent. It is intended to protect the parties to a litigation against alienations by their opponents during the pendency of the suit. The law of lis pendens is an extension of the law of res judicata and makes the adjudication in the suit binding on alienees from parties pending suit; just as much as the law of res judicata makes the adjudication binding on the parties themselves and on alienees from them after the decree: It affects a purchaser pendente lite not because it amounts to notice, but because the law does not allow litigant parties to give to others, pending the litigation, rights to the property in dispute, so as to prejudice the opposite‑party. If this were not so, there would be no certainty that the litigation would ever come to an end. Ordinarily. it is true, the decree of the Court binds only the parties to the suit. But he, who purchased during the pendency of the suit, is bound by the decree, that may 'tie made against the person, from whom he derives title. The litigating parties are exempted from the necessity of taking any notice of a title so acquired. As to them it is as if no such title existed. The rule may sometimes operate with hardship upon those, who purchase without actual notice yet general convenience requires its adoption; and even a mortgage, taken pendente lite, cannot be exempted from its operation. The rule is, therefore, based on expediency, that is the necessity for' final adjudication. It would be plainly impossible that any action or suit could be brought to a successful termination if alienations pendente lite were permitted to prevail: (1805) 32 ER 1062 and (1857) 44 ER 842 ref. to. (Para. 8) The true scope of section 52 of the Transfer of Property Act therefore, is that it does not prevent the vesting of title in a transferee to a sale pendente lite but only makes it subject to the rights .of other parties as decided in the suit In other words the effect of section 52 is not to wipe out a sale pendente lite altogether but to subordinate it to the rights based on the decree in the suit As between the parties to the transaction however it is perfectly valid, and operates to vest the title of the transferor in the transferee. Hence the contention that a transfer pendente lite must, for purposes of section 52, be treated as still retaining title to the properties cannot be accepted. The broad purpose of section 52 is to maintain the status quo unaffected by the act to the parties to the litigation pending its determination The applicability of the section cannot depend on matters of proof or the strength or weakness of the case on one side or the other in a bona fide proceeding. To apply any such test is to misconceive the object of enactment: (S) AIR 1956 SC 593 and AIR 1948 PC 147; and ILR 29 All. 339 (PC) rel. on. Para. 9) Anno: AIR Com. T.P. Act, S.52, N. 1,4." The doctrine of lis pendens was also examine in case titled Ata Muhammad v. Zubair Mahmood Khan (1980 CLC 446) wherein it was held as follows:‑‑ " 'Lis pendens' literary means a pending suit or cause and ,the doctrine of 'lis pendens' has been defined as jurisdiction, power or control which a Court acquires over property involved in a suit, pending. the continuance of the action, and until final judgment therein. It denotes those principles of rules and laws which define and limit the operation of the Common Law Maxim to the effect, that nothing relating to the subject‑matter of a suit can be changed while it is pending. One, who with actual or constructive notice of the pending action acquires from a party thereto an interest in the property, involved in litigation in a Court and of the person of the one from whom the interest is acquired, takes subject to the rights of the parties to the litigation as finally determined by the judgment or order or decree. It has been observed that the effect of 'lis pendens' is in its nature, the same as that of registration since it is only a different example of the operation of the rule of constructive notice. It charges subsequent purchaser or other person acquiring an interest in the subject of litigation during the pendency thereof with notice of the pendency of the action. It merely serves as warning to others that rights which they may acquire would be subject to any judgment entered. Its net effect would be to maintain 'status quo'. In the instant case the allotment (if it could at all be called an allotment) was made by the Cooperative Society with the express condition that it was subject to the ultimate outcome of litigation which' was in progress. Thus, the doctrine of 'lis pendens' can be invoked in this case with full force. Reliance in this regard is placed upon Pir Abdullah Shah v. Humayon (PLD 1957 Lahore 1054) and Haider Ali v. Akbar Ali (PLD 1973 Lahore 546)."

7. On the touchstone of criterian as mentioned hereinabove we have examined the agreement (Exh.P/1) executed by Mst. Ulfat Bibi wherein it has been made abundant clear that transfer of the land in question would be subject to the judgment of. the Court meaning thereby that she had no intention to frustrate the ultimate results of litigation pending in the Court and in such view of the matter the principle of lis pendens cannot be made applicable. In our considered opinion there is absolutely no lawful justification to put a restrictive construction on section 52 of the Transfer of Property Act, 1882, and stretch it too far by inferring that even agreement to sell which is subject to limitations as enumerated in section 52 of the Transfer of Property Act, 1882, cannot be executed. Any other interpretation except as mentioned hereinabove would have strange and incongruous results which could not have been contemplated by the, Legislature. The observation of Lahore High Court that "Rana Abdul Sattar Khan had entered into the agreement, dated 23‑5‑1972 with Mst. Ulfat Bibi knowing fully well that the ownership of Mst. Ulfat Bibi was in dispute in the suit then pending and had, therefore, agreed to obtain the land in suit at his own risk, I am of the view that the plaintiffs were not entitled to have the agreement, dated 23‑5‑1972 specifically enforced" does not appear to be in consonance with the provisions as contained in section 52 because the question whether the factum of litigation was within the knowledge of Rana Abdul Sattar would have no bearing on the agreement (Exh.P/1) because "the application of doctrine of lis pendens does not depend upon the purchaser having notice of the suit: even if the transferee pendente lite from a party has no notice of the suit, the rights of the other party to a suit in which a right to immovable property is directly and specifically in question under .the decree cannot be prejudicially affected by the transfer. The application of the rule contained in section 52 of the Transfer of Property Act has to be adjudged by reference to ,the claim made in the suit and the decree passed and not on any academic consideration as to what the true state of the law applicable to the dispute between the ,parties is and whether the decree was properly passed in the light of the true rule applicable". (Krishnaji v. Anusayabai, AIR 1959 Bombay 475). It is worth mentioning that "the rule of lis pendens is based not on the doctrine of notice but on expediency, that is "necessity for final adjudication". (Tribhovandas v. Mangaldas, AIR 1954 Saurashtra 82).

8. It is an admitted feature of the case that at the time of execution of agreement Mst. Ulfat Bib was exclusive owner of the land situated in Chak NO‑295 JB (we are not concerned with her ownership pertaining to other lands situated in different areas) but her exclusive ownership was reduced to that of 1/3rd as per judgment, dated 1‑2‑1982 which had attained finality and remaining 2/3rd shares were given to Faqir Muhammad against whom the appellant has no grievance. Here at this juncture the question arises that up to what extent the agreement (Exh.P/1) could be enforced. It reveals from a careful scrutiny of the evidence which has come on record that Mst. Ulfat agreed to sell out the land comprising of Killas Nos.7 to 10, 11/1, 12/1, 13/1 and 14/1 of Square No.24 measuring 53 Kanals, 19 Marlas situated in Chak No.295 JB which is also indicative from the agreement and plaint and thus the appellant would be entitled to 1/3rd of the land situated in Chak No.295 JB which comes to about 17 Kanals, 19 Marlas and not the entire land located in Chak No.295 JB.

9. Accordingly, the impugned judgment is set aside and the judgment and decree, dated 9‑3‑1988 passed by learned Civil Judge 1st Class, Toba Tek Singh, are upheld subject to above modification. M.B.A./M‑199/S Appeal allowed.