P L D 1964 (W (PLP)

S. A. MAHMOOD, J.‑Sher Muhammad, defendant No. 3, was an occupancy tenant of the land in dispute, paying cash rent. On the coming into force of the Punjab Tenancy (Amendment) Act, 1952 (Act VII of 1953) he acquired proprietary rights therein on payment of compensation. He sold the land in dispute to Muhammad Bashir and Muhammad Nazir for a sum of Rs. 2,000 by means of a mutation of sale, which was attested on the 6th of February 1956. Ibrahim plaintiff, claiming to be a collateral of the alienor within the fifth degree, brought a suit for a declaration to the effect that the sale being without consideration and legal necessity, would not affect his reversionary rights after the death of the alienor and as that the alienor was bound by custom, and the land in dispute was ancestral qua the plaintiff. The suit was contested by the alienor as well as the alienees. They denied the ancestral nature of the land in dispute and also that the alienor was governed by custom in matters of alienation and succession and that the plaintiff was his collateral. It was also pleaded that the sale being for consideration and legal necessity was, in any case, binding upon the plaintiff. A plea was further raised that Khasra No. 471, mentioned in the plaint, was not included in the sale. Seven issues were framed in the suit, 2. The trial Court found that Khasra No. 471 was included in the sale; that the plaintiff was a collateral of the vendor within the fifth degree and had locus standi to maintain the suit; that the land in dispute was ancestral qua the plaintiff and that the alienor was governed by agricultural custom in matters of alienations of ancestral land. Thus issues Nos. 1 to 4 were decided in favour of the plaintiff. It was further found that the alienor could not alienate the land without consideration and valid necessity and that it was not proved that the land in dispute was sold for consideration and valid necessity. Thus issues Nos. 5 and 6 were found against the defendants. Consequently, the plaintiff's suit was decreed with costs. 3. On appeal before the District Judge, the finding of the trial Court on issue No. 3, namely, that the land to dispute was ancestral qua the plaintiff and the alienor, was challenged. The learned District Judge, relying on Sangat Singh and another v. Isher Singh and others (A I R 1927 Lah. 536) came to the conclusion that the occupancy rights held by the alienor had merged in the proprietary rights acquired by him and the land could not, In these circumstances, be treated as ancestral property and that as it had become self‑acquired property of the alienor, the collaterals had no right to challenge the alienation. The findings of the trial Court on issue No. 3 were set aside, and, accepting the appeal, the plaintiff's suit was dismissed with costs throughout. This is a second appeal by the plaintiff. 4. In this second appeal, the only question agitated before us is whether the land in dispute is ancestral qua the plaintiff appellant. It is argued by the learned counsel for the appellant that as the occupancy rights were ancestral qua the plaintiff, which is no more in dispute between the parties, and the proprietary rights, which were acquired, were based on and flowed from those rights, the land so acquired must also be deemed to be ancestral property. On behalf of the respondents it is urged that the occupancy rights, on which the plaintiff based his claim, were in fact extinguished, that new rights were acquired by the alienor, (defendant No. 3) and in so far as it was a case of acquisition of proprietary rights by him, and the land in his hands was his self‑acquired property. 5. The acquisition of proprietary rights by defendant No. 3, the alienor, took place under section 114 of the Punjab Aliena tion of Land Act, which was introduced by the Punjab Tenancy (Amendment) Act, 1952. It runs as under :‑ "Extinction of occupancy tenancies.‑(I) Notwithstanding anything contained in any law for the time being in force, including this Act, no person shall, after the coming into force of the Punjab Tenancy (Amendment) Act, 1952, acquire or have occupancy rights in any land under any enactment or contract or any decree or order of any Court or other authority, and the existing occupancy rights in respect of all lands other than lands owned by Government or by any person who under the law for the time being in force is an evacuee, shall on the coming into force of the aforesaid Act, be extinguished, and the land comprised in a tenancy so extinguished shall vest as hereinafter provided. (2) An occupancy tenant, who at the time of the coming into force of the aforesaid Amendment Act occupies any land as such shall become owner as under :‑ (a) of the entire land comprised in his occupancy without payment of any compensation as corresponds to his share of the produce, where he pays rent in the form of a share of the produce; (b) of such portion of the land comprised in his tenancy without payment of any compensation as corresponds to his share of the produce, where he pays rent in the form of a share of the produce; (c) of the entire land comprised in his tenancy on payment of compensation to the landlord in cash at such rates and within such periods as may be prescribed by the Government by rules framed for the purpose, where he pays rent only in cash; (d) of the whole or a portion of the land comprised in his tenancy on payment of such compensation in such form and within such time to the landlord as may be determined by Government by rules framed under this Act, where he pays rent partly in cash and partly in the form of a share of the produce. (3) So long as Government does not frame rules for pur poses of clauses (c) and (d) of subsection (2), an accupancy tenancy falling under any of those clauses shall, notwith standing the provision made in subsection (1), continue to subsist, and the landlord and the accupancy tenant shall continue to enjoy the same rights, and be subject to the same liabilities, as before. (4) In a case falling under clause (b) of subsection (2) the landlord shall, without payment of any compensation, be entitled to the possession of the rest of the land comprised !n the tenancy. (5) An occupancy tenant acquiring land in accordance with the provisions of subsection (2) shall acquire it free from all encumbrance created in respect of that land by the landlord and if any encumbrance be created by the tenant, the share of the land received by the landlord shall be free from it and notwithstanding any provision of any law for the time being in force to the contrary each such encumbrance shall become the exclusive liability of the landlord or the occupancy tenant, as the case may be. (6) Where compensation, is to be paid by a tenant in cash under clause (c) of subsection (2) Government may, with a view to enabling an occupancy tenant to acquire land in accordance with the provisions of this section, advance a loan which shall be recoverable as arrears of land revenue with interest at such rates and in such instalments as the Govern ment may fix generally or in particular cases. (7) Government shall frame rules to give effect to the provisions of this section, and while framing rules it may classify lands into different categories and prescribe different principles for assessment of compensation." The effect of this provision is to extinguish occupancy rights and to vest in the tenant proprietary rights in the land on payment of compensation to the landlord. The land vested in defendant No. 3 in accordance with the provisions of subsection (2) (c) of section 114 of the Punjab Alienation of Land Act. Thus, in effect, occupancy rights were extinguished by operation of law and were substituted by proprietary rights, but for the acquisition of proprietary rights, the occupancy tenant had to pay compensa tion. In so far as compensation was paid, by which new rights were acquired, the land is self‑acquired property of the new owner. In such a case, the occupancy rights merge in the proprietary rights. It was so held in Sangat Singh and another v. Ishar Singh and others wherein the facts were that the common ancestor, Ishar Singh, occupied the land as an occupancy tenant and the rights of the landlord were purchased by Ran Singh himself. The dispute in the case related to a moiety of the estate left by Ran Singh. Maya Singly first cousin of Ran Singh, was entitled to succeed to one‑half of the estate and he had transferred his share of inheritance to the plaintiffs. The plaintiffs had brought a suit in which the defendants contended that the sale effected by Maya Singh in favour of the plaintiffs should not affect their reversionary rights after the death of the vendors. The learned Judges of the Lahore High Court held that though the common ancestor Ishar Singh occupied the land as an occupancy tenant, the rights of the landlord having been purchased by Ran Singh himself, the occupancy rights merged In the proprietary rights, and the property could not be treated as ancestral property. We respectfully agree with these observations. In the present case, there is in addition extinguishment by operation of law of occupancy rights. 6. Learned counsel for the respondents relies on some cases of acquisition of proprietary rights in lands under the Coloniza tion of Government Lands Act. In Ghulam Muhammad and another v. Allah Bakhsh and others (A I R 1937 Lah. 78) and Faiz Ali, deceased represented by Mst. Nur Jan and another v. Mst. Rafia Jan and others (P L D 1956 Lah. 94) proprietary rights were acquired by the widow under section 30 of the Punjab Colonization of Government Lands Act, and the widow was regarded as full owner of the property, wherein she had acquired the proprietary rights. He also relied on Jagat Singh and others v. Mst. Raj Devi and others (A I R 1938 Lah. 554) where it was observed that a widow acquiring proprietary rights under the Punjab Colonization of Government Lands Act, acquires them as an absolute owner whether the grant is a peasant or yeoman grant. The fourth case, Sarwan Singh and others v. Lal Singh and others (112 I C 168) is also a case in which land was granted by Government to a person on lease and he died without fulfilling the con ditions for acquiring proprietary rights, which were subsequently acquired by his son, in whose name the lease was renewed. It was held that the land must be regarded as the self‑acquired property of the son. These cases support the contention of the learned counsel for the respondent that where proprietary rights are acquired by a tenant, the property is deemed to be his self acquired property and not ancestral qua the reversioners of the original tenant, though the facts of these cases are somewhat different from the case in hand. The case in hand is certainly not one of accretion to the estate held under custom. 7. For the reasons given above, we, agreeing with the District Judge, hold that the proprietary rights acquired by Sher Muhammad, defendant No. 3, were sell‑acquired property and the land could not be treated as ancestral property qua the plaintiff. 8. We, therefore, see no force in this second appeal which is dismissed with costs. K. B. A. Appeal dismissed