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Writ Petition No. 554/B of 1960, decided on 9th February 1962.

Sch. paras. 15 & 15-A-Transfer of industrial concern-Central Government's order under para. 15-A only "supplementary" to provisions of para. 15-Priority of para. 15 to orders under para. 15-A" Transfer" In para. 15 (4) means "trans ferable" - Central Government's order under para. 15-A No. F. 3 (1)/59-60 (Clms.) dated 14-11-1959.

- "Lumping" together of separately verified claims of "joint" owners of Industrial concern in India who have applied "jointly" for such a concern in Pakistan-Permissible for purpose of para. 15 (2)-"Separate" verifications of claims of "joint" owners immaterial.

nterim management of industrial concern-"Entirely" within province of Chief Settle ment Commissioner.

-Grounds-Not permissible which were not raised before Authority against whose order relief is sought by writ --Constitution of Pakistan (1956), Art. 170.

Mahmud Ali and Kh. A. Rahim for Petitioners.

Sh. Khurshid Ahmed, S. Ali Raza and Major Ishaq Muhammad, Additional Rehabilitation and Settlement Commissioner for Respondents.

Dates of hearing : 31st January and 1st February 1962.

The Chief Settlement and Rehabilitation Commissioner by his order dated the 3rd of May 1960 (Annexure A) directed the transfer of Raghu Ram-Tulsi Ram Re-Rolling Mills, Badami Bagh, Lahore to Messrs Muhammad Ramzan-Muhammad Ismail and Muhammad Ibrahim respondent No. 1. It was further directed that on the basis of the Investment made by Messrs Chiragh Din and Ghulam Muhammad petitioners, they would be associated with the transferees in the purchase of the above mentioned concern. Lastly, it was directed in the order that the transferees would be entitled to work the above concern on behalf of the Chief Settlement Commissioner, Pakistan, on the usual conditions of allotment until its permanent transfer was sanctioned. Both the parties and some others filed review petitions against this order which were ultimately disposed of by the Chief Settlement and Rehabilitation Commissioner by his order dated the 17th of October 1960 (Annexure F). Before the passing of this order, the Mill was in the possession of the petitioners as they were the highest bidders amongst all the allottees, but in pursuance of this order of the Chief Settlement and Rehabilitation Commissioner the possession has now been transferred to Muhammad Ramzan-Muhammad Ismail and Muhammad Ibrahim respondents. The petitioners have challenged the transfer order passed by the Chief Settlement and Rehabilita tion Commissioner by means of this writ petition.

2. The petitioners' contention Is that the Mill should have been transferred exclusively to them or, in any case, as they were .co-transferees they should not have been ejected from the Mill. The learned counsel for the petitioners has raised the following contentions :-

(1) That this industrial concern should have been transferred to the petitioners under paragraph (2) of the orders of the Central Government No. F. 3 (1)/59-90 (Clms), 14th December 1959 (Gazette Extraordinary 14th December 1959). The Chief Settlement Commissioner should have first ascertained the prevailing market-value of the machinery installed in the industrial concern and in case It was found that the invest ment of the petitioners, which had already been verified to the extent of Rs. 27,000 was not less than 50% of the prevailing market-value of machinery in the concern it should have been transferred to the petitioners, that the order of the Settlement Commissioner was bad in so far as it had been passed without first ascertaining the market-value of the machinery installed therein and adjudicating upon the right of the petitioners under paragraph (2) of the above notification. That in case the petitioners were not found entitled under the above para graph, it was only then that the claim of some one else, including the respondents, could have been considered for the transfer of the concern.

(2) That the respondents, although they were joint owners of a concern, in India and were also joint allottees in Pakistan, but they had filed their claims separately and consequently they could not club together their verified claim In order to claim a transfer of the concern jointly as the claim of none of them individually had been verified for a sum of Rs. 66,000 or to the extent of one-third of the total value of the machinery. As compared to this, the petitioners had filed their claim jointly for the machinery which was jointly owned by them in India.

(2) That the respondents not being in possession of the concern, ft could not have been transferred to them even under paragraph 15 (2) of the Schedule.

3. Before dealing with these contentions of the learned counsel for the petitioners, I would briefly put down the reply that has been given by the learned counsel for the respondents and also by Mr. Ishaq Muhammad Khan, the Additional Rehabilitation Commissioner (Legal). It has been urged that the Central Government did not intend to repeal paragraph 15 of the Schedule by issuing the notification of the 14th of December 1959 under section 15(A) of the Schedule. This notification is to be read in conjunction with section 15 as contained in the Ordinance, that the transfer in favour of a person on the basis of his investment cannot take precedence over persons who are entitled to the transfer under section 15 (2) and (3) and that the word "claimant" as used in section 15 (2) in accordance with Its interpretation under the General Clauses Act would also include more than one claimant. The criteria is whether they owned an industrial concern jointly in India. The fact that the res pondents, even after migration, claimed and got a joint allotment further indicated that all of them, in the eye of law, formed one claimant. They would not have been permitted to join their claims if they were owners of some Independent industrial concerns in India but as their industrial concern known as "Crown Mechanical Workshop, Batala" was jointly owned by all three of them, the mere fact that they had filed individually a claim for one-third share in the same would not mean that their total verified claim would not be treated as one claim for the purposes of the transfer of an Industrial concern in Pakistan. It has been further contended that the possession of the petitioners on the factory was in pursuance of their highest bid, that as a result of that the other allottees of the industrial concern could not be regarded to have been out of possession. They were joint allottees with the petitioners and were receiving a share of the income from this industrial concern which was being run by the petitioners and that the word "possession" in the Act would also include constructive possession. Moreover, the Chief Settlement Commissioner has clearly notified that for the purposes of transfer, all the allottees in a concern will be deemed to be in possession. The Chief Settlement Commissioner dis charges his functions and performs his duties under the general superintendence and control of the Central Govern ment. Consequently his direction in such matters will be regarded as having been given under the directions of the Central Government.

4. Major Ishaq Muhammad Khan has supported the case of the respondents and has argued that paragraph 2 of the notification of the Central Government of 14th December 1959 would came into operation only in case there was no one eligible for the transfer of the concern under paragraph 15 (2) and (3) of the Schedule. He has urged that the words in paragraph (2) of the notification "if any local or displaced person has invested in any engineering concern, not being an engineering concern transferred under sub-paragraph (2) or sub-paragraph (4) of paragraph 5 of the Schedule . . . ." indicate that if the concern is transferred under sub-paragraph (2) or sub-paragraph of paragraph 15, paragraph 2 of this notification will not come Into operation. The transfer under this para would only be given effect to if there is no one eligible for transfer of the con cern under sub-paragraph (2) or sub-paragraph (4) paragraph 15 of the Schedule. Since the respondents were found entitled to the transfer under paragraph 15 (2) of the Schedule, as supple mented by paragraph 4 of the Central Government order dated the 14th of December 1959, there was no question of the transfer being made to a person who claims the transfer on the basis of his investment under paragraph 2 of the notification alone. As regards the lumping of the verified claims of the respondents, he has urged that the word "claimant" would include such persons who had a joint concern in India and who, after migration, also claim the transfer of a concern jointly. As regards the transfer of the possession, it has been urged that section 8 of the Settlement Act gave ample powers to the Chief Settlement Commissioner to make any arrangements he thought fit for the management of an industrial concern, pending permanent transfer. The property not having been finally transferred to anybody, it was up to the Chief Settlement Commissioner to make any arrangements for its management during the interim period, and consequently the petitioners had no right to contest their physical dispossession from the industrial concern. Lastly, It has been urged that the grounds taken up by the petitioners in the supplementary grounds filed with this writ petition were never raised before the Chief Settlement Commissioner, that the case of the petitioner all along had been that he was entitled to the transfer of the industrial concern under paragraph 15 (4) and that the contesting respondents were not entitled to the transfer of the concern as they did not file a joint claim and it was not permissible under law to club together the claims which had been separately filed. It Is urged that the petitioners should not be permitted to raise a new ground in this writ petition.

5. It will be advantageous to cite the different paragraphs of the Displaced Persons (Compensation and Rehabilitation) Act, 1958, as amended up to date. The Schedule under the Act deals with the transfer of different categories of evacuee property. Part IV, paragraphs 15 and 15-A are as follows: --

"(1) Every industrial concern or cinema house shall, subject to the provisions of the following sub-paragraphs, be sold in an unrestricted public auction.

(2) if an industrial concern or a cinema house allotted by the Industries Rehabilitation Board constituted under the Pakistan Rehabilitation Act, 1956 (XLII of 1956) is in the possession of a claimant who has left in India or any area occupied by India a registered industrial concern or a cinema house or whose verified claim under Schedule III to the Registration of Claims (Displaced Persons) Rules, 1955, is of the value of rupees one lac or more, then the industrial concern or the cinema house in the possession of such claimant, shall in case he applies in that behalf, be transferred to him on payment immediately of the prevailing market-value minus the Invest ment made, if any:

Provided that if the claimant concerned has abandoned a share in a registered industrial concern or a cinema house the industrial concern or the cinema house in his possession shall not be transferred to him unless his verified claim in respect of such share is rupees thirty-three thousand or more.

(3) If an industrial concern or a cinema house not allotted by the aforesaid Industries Rehabilitation Board, is in the possession of a displaced person or a local, then such concern or cinema house shall, in case he applies in that behalf, be transferred to him on payment of its prevailing market value minus the investment made, if any.

(4) If any local or displaced person has invested in any industrial concern or cinema house, not being an industrial concern or cinema house transferred under sub-paragraph (2) or sub-paragraph (3), not less than forty per cent. of its prevailing market-value, then that concern or cinema house shall, in case such local or displaced person applies in that behalf, be transferred to him on payment immediately of the prevailing market value minus the investment made.

(5) Not more than one industrial concern or cinema house shall be transferred to any one person under sub-paragraph (2), or sub-paragraph_(3) or sub-paragragh (4).

Explanation.-In this paragraph-

(a) Investment made' means an amount sanctioned by a Custodian or a competent Rehabilitation Authority or the Chief Settlement Commissioner on an application made on or before the 20th day of December 1958 ; and

(b) registered industrial concern' means a factory which stood registered under the Factories Act, 1934, on the fourteenth day of August 1947."

"15-A. Notwithstanding anything contained in paragraph 15, the Central Government may make any order for the disposal of any class of industrial concerns or cinema houses in such manner as may be specified therein."

The Central Government issued two notifications under para graph 15-A, one No. F. 3 (1)/59-60 (Clms.) dated 19th October 1959, and the other No. F. 3 (1)/59-60 (Clms.) dated 14th November 1959. The earlier one has not been relied upon in the present case by any of the parties. However, much of the arguments in the case have centered round the order of the Central Government dated the 14th of November 1959, which reads as follows:

"In continuation of the Ministry of Rehabilitation Order No. F. 3 (1)/59-60 (Cams.) dated the 19th October 1959, and in exercise of the powers conferred upon it under paragraph 15-A of the Schedule to the Displaced Persons (Compensation and Rehabilitation) Act, 1958 (XXVIII of 1958), the Central Govern ment is pleased to make the following order for the disposal of industrial concerns and cinema houses: -

(1) If a printing press allotted by the Industries Rehabilita tion Board constituted under the Pakistan Rehabilitation Act, 1956 (XLII of 1956) is in the possession of a claimant who has left in India or in any area occupied by India a printing press, then the printing press in the possession of such claimant, shall, in case he applies in that behalf, be transferred to him on payment immediately of the prevailing market-value minus the investment made, if any.

(2) If any local or displaced person has invested in any engineering concern, not being an engineering concern transferred under sub-paragraph (2) or sub-paragraph (4) of paragraph 15 of the Schedule to the Displaced Persons (Compensation and Rehabilitation) Act, 1958, not less than fifty per cent. of the prevailing market-value of the machinary installed therein, then such engineering concern shall, in case such local or displaced person applies in that behalf, be transferred to him on payment immediately of the prevailing market-value minus the investment made, if any.

(3) If an industrial concern or a cinema house allotted by the aforesaid Industries Rehabilitation Board is in the posses sion of a claimant whose claim in respect of a registered industrial concern or cinema house left by him in India has been verified for an amount less than rupees thirty-three thousand, then the industrial concern or cinema house in the possession of such claimant shall, subject to the rights of any other person who may otherwise be entitled to retain it, be sold in an unrestricted public auction:

Provided that if the value of the industrial concern or cinema house in the possession of such claimant does not exceed three times the amount of his verified claim in respect of the registered concern or cinema house left by him in India, the Chief Settlement Commissioner may transfer the industrial concern or cinema house in the possession of such claimant to him on payment immediately of the prevailing market value.

(4) 1f an industrial concern or a cinema house allotted by the aforesaid Industries Rehabilitation Board is in the posses sion of claimant who has left in India a registered industrial concern or whose claim in respect of an unregistered industrial concern left by him in India has been verified under Schedule III to the Registration of Claims (Displaced Persons) Rules, 1955, for an amount of rupees one lakh or more, then unless the value of the machinery installed in the registered or unregis tered industrial concern left by him in India, has been verified for a sum of rupees sixty-six thousand or constitutes at least one-third of its total value, the industrial concern or cinema house in the possession of such claimant shall, subject to the rights of any other person who may otherwise be entitled to retain it, be sold in an unrestricted public auction."

5. The learned counsel for the petitioners' first contention is that the Settlement Authorities should have first ascertained the prevailing market value of the machinery installed in the disputed industrial concern and if they had found that their investment of Rs, 27,000 already sanctioned by the department, was mare than 50% of the prevailing market value of the machinery, the petitioners were alone entitled to the transfer of the concern under paragraph 2 of the order of the Central Government dated the 14th November 1959. Since the Chief Settlement Commissioner had transferred the concern without finally deciding about the right of the petitioners under para graph 2. the order was bad and that the case should be ordered to be decided after the determination of the market value of the machinery in the concern. In case it was found that the plaintiffs were not entitled to the transfer under the above paragraph, it would only have been then possible to order the transfer to some other person. Even in that event the respondents would not be entitled to the transfer of the concern as none of them individually had a verified claim in the amount of Rs. 60,000 or to the extent of at least one-third of the total value of the concern. It has been very vehemently urged by the learned counsel that the order of the 14th November 1959 will have precedence over paragraph 15 of the Schedule. I do not agree with the contention of the learned counsel as the order issued by One Central Government on the 14th of December 1959 is supplementary to paragraph 15. Sub-paragraph (4) of para graph 15, which relates to the investment of an individual in a concern, comes into operation only if the concern is not transferred to some other claimant under sub-paragraph (2) or subpara graph (3). Consequently, paragraph 2 of the order of the Central Government will come into operation only if the concern is transferable under sub-paragraph (4) of paragraph 15 of the Schedule. Paragraph 4 of the order of the Central Government is similarly supplementary to sub-paragraph (2) of paragraph 15 of the Schedule. In paragraph 2 of the order of the Central Government, the word, "if any local or displaced person has invested in any engineering concern, not being an engineering concern, transferred under sub-paragraph (2) or sub-paragraph (4) of paragraph 15 of the Schedule to the Displaced Person, (Compensation and Rehabilitation) Act, 1958, . . . . ." clearly indicate that this sub-paragraph will come into operation at the tine when the concern is being transferred under sub-paragraph (a) of paragraph 15 of the Schedule, that is to say, if the concern has not already been transferred under sub-paragraph (2 or sub-paragraph (4) of paragraph 15 of the Schedule, it. will only then be possible to order the transfer of the concern to a claimant in accordance with paragraph (2) of the order of the Central Government. Learned counsel for the petitioners contended that the above words of paragraph 2 of the order were Intended only to protect the orders of transfer already made under paragraph 15, sub-paragraphs (2) and (4) of the Schedule, but I am afraid this construction is not possible. As these words were contained even in the Displaced Persons (Compensation and Rehabilitation) Act, 1958, when it was first promulgated, no transfer of any concern could have been made before the promulgation of the Act in 1958. Consequently the word "transfer" has been used in sub-paragraph (4) of para graph 15 of the Schedule 'And paragraph 2 of the order of the Central Government to mean as transferable. The whole' scheme of paragraph 15 of the Schedule clearly indicates that preference was to be given in the matter of transfer of the concerns in accordance with the priorities laid down in the section. These priorities have not been disturbed by the later order of the Central Government and these will have to be maintained even if a transfer order is passed in accordance with the order of the Central Government dated the 14th of November 1959. I, would, therefore, hold that the order of transfer passed by the Chief Settlement Commissioner is not bad as urged by the learned counsel for the petitioners.

7. As regards the second contention raised by the learned counsel for the petitioners that the respondents could not be allowed to club together their claim, I do not find any force even in this argument. The respondents jointly owned a concern in Batala. They were joint allottees in this concern right from the very beginning. Even at the time of the transfer they jointly prayed for the transfer of the concern in their name. Foil, all intents and purposes their claim will be treated as one and they have been rightly treated as a claimant under sub-para-1 graph (2) of paragraph 15 of the Schedule. The petitioners also similarly owned a concern jointly, but the learned counsel wants to have preference in their case, because they had filed a claim jointly. I do not see any reason why the same advantage cannot be derived by the respondents. The filing of a separate claim does not, In any way, disrupt the jointness of the ownership of their concern and also their joint entitlement to have the industrial concern transferred to them.

8. Lastly, the argument of the learned counsel that as they have been ordered to be associated in the transfer of the Mill with the respondents, they should not have been dis possessed from the industrial concern has also no force. As a matter of fact this point has already been decided against the petitioners by cry order dated the 26th of November 1960. The management of an industrial concern during the interim period is entirely the province of the Chief Settlement and Rehabilitation Commissioner. I, therefore find no force in this) argument of the learned counsel as well.

9. There are two more reasons why this writ petition deserves to be dismissed. Firstly, the final order of the transfer of the Mill is yet to be made by the Chief Settlement and Rehabilitation Commissioner. He may change his previous order which up till now is only a provisional order of transfer. Secondly, the grounds that have been urged initially in this writ petition are contained in paragraph 14 (a), (b), (c), (d) and (e). It will be seen that the only contentions in these grounds are that the petitioners were entitled to the transfer of the factory under paragraph 15 (4) of the Schedule, that the order of the Chief Settlement Commissioner was bad in so far as it was passed without any notice to the petitioners that the respondents were not entitled to the transfer of the concern as their individual claim was below the prescribed limit, and that the Chief Settlement and Rehabilitation Commissioner did not wait for final adjudication by the enforcement staff as regards the validity of the claims of the respondents. These were also the grounds that were urged by the petitioners at the time of the review petition before the Chief Settlement Commissioner. The petitioners for the first time raised the contention which has been urged as contention No. 1 in their additional grounds which were filed on the 27th of October 1960 and are contained in paragraph 3 of the amended petition. It is not permissible in a writ petition to raise a contention for the first time without affording an opportunity to adjudicate upon it to the Court against the final order of which a writ petition is filed. In view of what I have said above, I would dismiss this petition with costs.

A. H.

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