1. INTRODUCTORY NOTE:

The technical Arabic term for its Anglo- Mohammadan enquivalent pre-emption, Is "Shufaa", "Shufaa" literally means adding. In law pre-emption is defined as 'a right which the owner of certain immovable property, possesses, as such, tor the quiet enjoyment of that immovable property, to obtain in substitution for the buyer, proprietary possession of certain other immovable property, not his own, on such terms as these on which such latter immovable property is sold to another person.1 Thus pre-emption is the right which the owner of an immovable property possesses to acquire another immovable property for the price for which it has been sold to "another person. The definition as it stands seems very difficult and complicated. But the fact that this definition _ is most scientific and comprehensive, an explanation of it will greatly facilitate its understanding."

1. DEFINITIONS:

Defintions of Pre-emption is as under:

Mulla defines : The right of shufaa or pre-emption is a right which the owner of an immovable property possesses to acquire by purchase another immovable property which has been sold to another person".

Mahmood, J., says "      a right which the owner of certain

immovable property possesses, as such, for the quiet enjoyment of that immovable property, to obtain, in substitution for the- buyer, proprietary possession of certain other immovable property, not his own, on such terms as those on which such latter immovable property is sold to another person".

The Law of Pre-emption was introduced and made applicable as rule of general law of the land for all communities by Mughals in Subcontinent.

With the establishment of British Rule in India, the pre-emption was administered even to Mohammedans only on the grounds of justice, equity and good conscience. Gradually, it existed in some parts of the country as a part of Mohammedan Personal Law; in some pans it was based on custom; among some people it came into existence by contract and in other parts it existed under statutes. After independence, the Law of Pre-emption prevailed on many parts of the country.

 

 

1. MEANING:

Literally, the term pre-emption means purchase by one person before an opportunity is offered to others. It is derived from a right which signifies conjunction i.e. the lands sold are conjoined to the land of pre-emptor. It is a right which is possessed by the owner of an immovable

property to acquire another immovable property for the price for which it has been sold to another person. It is the legal right of purchasing an immovable property before all others. In the words of Mahmood J: It is “ a right which the owner of immovable property possesses, as such for the quiet enjoyment of that immovable property, to obtain, in substitution from the buyer, proprietary possession of certain other immovable property, not his own, on such terms as those on which such latter immovable property is sold to another person.

1. OBJECTS:

The law is based on the principle of convenience. According to the Hedaya, “according to our tenets the grand principle' of Shuffa is the conjunction of property, and its object is to prevent the vexation arising from a disagreeable neighbor. The objects af pre-emptions may further be elaborated in following heads.

i. Protect privacy

The primary object of right emption is to protect the privacy of a specified area or locality

Case law:

In case titled "Khan Rafique Ahmed vs. Nawaz Khokhar". the court held that the object underlying pre-emption under Muslim law is to protect the privacy of a specified area.

ii. Discourage the strangers

To discourage the strangers to enter into a specified area.-

Case Law:

In case titled Saeeduddin  Ahmad vs. Yousaf Wali", the court held- that the object of pre-emption law is to prevent possible vexation arising from a disagreeable neighbour.

iii. Prevent the introduction of stranger

Pre-emption aims to prevent the introduction of a stranger among the co-sharers and neighbours likely to cause inconvenience or vexation.

 

iv. Maintenance of sanctity

The object is to maintain the sanctity and piousness' in a specified area,

Case Law:

In case titled "Allah Bux vs. Jano". the court held that where no law of pre-empt ion is applicable to an area, Muslim law of pre-emption would apply to Muslim inhabitants of the area for maintenance of their sanctity.

v.       Respect native feeling

Its aim  is to preserve respect to native feelings as regards caste exclusiveness, the seclusion of family life and so forth.

vi.      Preserving prevailing values and Atmosphere

The law of pre-emption  does not aim to spoil the atmosphere of a particular area

vii.    Preserving integrity of villages

The paramount object of pre-emption in village communities is the preservation of integrity of a village.It aims to give an advantageous position to the person already present in a specified area to uplift their financial status.

Case Law:

In case titled “Rushan Khan Sindhu vs. Jabbar Khanzada". the court held that the law -of pre-emption aims to uplift the. financial and economical position of persons in a particular, area.

vii.    Preservation of compactness

The right of pre-emption aims to protect the compactness of village communities and through its agency, the total disintegration of community checked.

 

5.      CAPACITY TO PRE-EMPTOR:

The person who has the right to pre-empt is called, Shaft. Following are the qualification which a person must fulfill to claim the right of pre-emption:

a.       Pre emptor may belong to any gender: The person claiming the right of pre-emption may be a male or female.

b.       Majority not necessary: The person may be a minor or an adult. A child in the womb is also entitled to the right of pre-emption if it is born within six months and if the father had died before the sale, then even if it is born after more than six months provided that it inherits -the property from the father.

c.       Ownership of an immovable property: The person claiming the right to pre-empt, must be the owner of an immovable property. He or she should have full ownership. It is immaterial that a pre-emptor is not in possession of property. The basis of the right of pre-emption is that only the adjacent owner of some immovable property has a right to acquire by purchase another immovable property sold to another person so, a tenant, lessee in perpetuity, occupancy tenant, benamidar, Groveholder, etc. have no right of pre-emption.

1. CLASSIFICATION OF PRE-EMPTORS:

1. Hanafi Classification of pre-emptor:

Under Hanafi law three classes of pre-emptors are;

1. Shafi Sharik,
2. Shafi-i-Khalit, and
3. Shafi-i-Jar.

1. Shafi-i-Sharik:

Shafi-i-Sharik or a co-sharer or co-owner in the property sold has the right to pre-empt in preference to others. The right of pre-emption can be claimed only by a full-owner of an immovable property. For example a co-sharer may claim the right to pre-empt on the sale of Mahals and-Zamindaris. But if after partition of some joint property like Mahals or Zamindaris some property is left in joint possession for convenience, such-as common roads, common water course or common burial ground or chaupal, and then the person would not be co-sharer for the purposes of pre-emption.

1. Shafi-i-Khalit:

The term Khalit literally means ‘Mixed with”. A Shafi-i-Khalit is, under Hanafi Law a participator in immunities and appendages. The Shias and Shafis do not accept the right available to Khalits.

In the absence of a co-sharer, Shafi-i-Khalit is entitled to pre-empt. A person is Shaft-i-Khalit and is entitled to pre¬empt in the following cases:

1. Where a person has the right of flow of water over the disputed property, then he has the right of pre-emption as a Shafi-i-Khalit and has priority over the vendee, who is only neighbour.
2. Where water was accustomed to flow to the pre- emptor’s land and from there to land in dispute, the pre-emptor was held to be a participator in the appendage and entitled to pre-empt on the basis of Khalit.
3. The right to pre-emption arises form right of way and right to discharge water. A person cannot said to be the Shafi-i-Khalit and would not be entitled to the right of pre-emption in the following cases:

• On the basis that the branches of his tree project over the land of a neighbour, the owner of the tree cannot claim the right of pre-emption as Shafi-i-Khalit on the sale of that land.
• The mere fact that the owners of land have the right to draw water from a*Government water, course does not give them any right of pre¬emption,
• The right of pre-emption as Shafi-i-Khalit cannot be claimed on the basis of easement of light or air.

1. Shafi-i-jar:

Under the Hanafi Law Shafi-i-jar is the owner of an adjoining property or in other words it is mere neighbor who can be pre-emptor, but only in the absence of Shafi-i-Sharik and Shafi-i-Khalit. The Shias and the Shafts do not accept the right available to Jars. The right on the basis of neighbourhood arises only in favour of the owner of the adjoining immovable property. So, the right does not belong to a tenant or to a person who is in possession of property but does not have any ownership in it.

The right of pre-emption of a Shafi-i-Jar is restricted to houses, gardens and small parcels of land. It is not extended to large properties, such as Zamindaris and Jagirs.

1. RIGHT OF PRE-EMPTION WHEN ARISES

For the purpose of pre-emption, there are two types of transfer of property.

1. Sale, and
2. Exchange.

The right of pre-emption arises only in these two types of transfer of property. It does not arise in respect of transfer of property of any other type such as gift, sadaqah, Wakf, bequest, inheritance, mortgage, or lease.

1. PRE-EMPTION AFTER SALE:

When the right of pre-emption arises in respect of a sale then the sale must be complete, bona fide and valid. Under Mohammedan Law the sale is complete, when the price is paid and possession is handed over to the purchaser.

1. PRE-EMPTION AFTER AN EXCHANGE:

The right of pre-emption arises in respect of exchange, when it is complete, bona fide and valid. For example, if the exchange is subject to an option of either the vendor or vendee, to cancel it and take back the property at any time during their life-time and if one of them dies without cancelling it, the exchange will be said to be complete, bona fide and valid and the right pre-emption will arise.

1. TRANSACTION WHICH AMOUNTS TO SALE:

Sale, for the purpose of pre-emption is,

1. a transfer of ownership
2. of an immovable property
3. in exchange for money, or
4. property having some value in the terms of money

This definition of sale is different from the definition given under Section 54 of the Transfer of Property Act, I8S2 which run as follows:

“Sale is a transfer of ownership in exchange for a price paid or promised, or part paid and part-promised.

The difference between these two definitions is that under the Transfer of Property Act, price is limited to money only but Mohammedan Law, includes exchange of property also for property in sale. So, price includes not only money but also other property-capable of being valued in terms of money.

Following transactions may amount to sale for the purpose of pre-emption:

1. TRANSFER OF PROPERTY IN LIEU OF DOWER:

The transfer of property by a husband to his wife in lieu of dower is sale and, therefore, the right of pre-emption arises. But when the property is itself given as dower or in other words, it is not transferred in lieu of it, there would be no right of pre-emption.

1. TRANSFER OF PROPERTY IN LIEU OF DEBT:

When the property is given by the debtor or by a stranger for releasing the debtor from the debt, then such transfer of property is considered as in lieu of debt, so no right of pre-emption arises.

1. Contract for sale:

When a contract for sale is complete i.e. when the vendor has no option to resale, such transaction gives rise to pre-emption.

1. Hiba-Ba-Shart-ul-Ewaz:         

When mutual possession is taken in hiba-ba-shart-ul-ewaz, then the right of pre-emption arises.

1. GRANT:

Where a grant is made on the express condition of being for consideration and' in which the parties have obtained possession of the properly, then the grant amount to a sale so the right of pre-emption arises.

1. SALE BY OFFICIAL RECEIVER:

Where a private sale is made by an official receiver, it would amount to sale for the purpose of pre-emption giving rise to right to pre-empt,

1. PROPERTY GIVEN IN EXCHANGE FOR COMPOSITION:

Where some property is given in exchange for a composition, the right of pre emption would arise. But where the property is disputed, and is given by compromise to the defendant who does not admit the plaintiffs claim on payment of money, there would be no  right of pre-emption and if the defendant admits the plaintiffs claim making a compromise with him on payment "of some money then the right of pre-emption arises.

1. OTHER FORMS OF SALE:

Where a transaction is a sale but is disguised in the form of a ease, or mortgage, or gift, or Hiba-bil-Ewaz or, benami transcation then right of' pre-emption would arise. For example, the right of pre-emption would arise in a case of ostensible usufructuary mortgage which is in fact a sale.

1. FORMALITIES OF PRE-EMPTION/TALABS:

The right of pre-emption can be exercised only on the observance of certain essential formalities. Non-observance of any of the essential formalities, will be fatal to the suit of pre-emption.

1. Who makes demands: Demands may be made by the pre-emptor himself or through his authorized agent or legal or de facto guardian in case of minor, or the manager of a Court of wards.
2. Form of demands: There is no particular form of demands required for claiming the right of pre-emption, only a clear intention to pre-empt either by way of words or form surrounding circumstances must be gathered. According to the Hedaya, the words, I do claim my shufaa” may be used while asserting the first demand (tala-i-mawasibat), and for the second and such person (naming the vendee) has purchased the mansion (or land) of which 1 am the shaft, and I have demanded the pre-emption, and now to demand it; bear yet witnesses to him.
3. DEMANDS (TALABS) FOR PRE-EMPTION: The right of pre-emption arises only when the pre-emptor, on hearing of the transfer, makes the following demands in the order given below,

1. Talab-t-mawasibat or immediate demand (literally means demands by jumping) by which he should declare his intention to assert the right immediately on receiving the information of sale. Therefore (he right of pre-emption must be asserted with the utmost promptitude A delay of twelve hours was held in an Allahabad case to be too long.
2. Talab-i-ishaad or demand with invocation of witnesses When the right mentioned above has been asserted, the pre'-emptor should, with the least practicable delay, affirm his intention either in the presence of the buyer or the seller or on the premises which is the object of sale, in presence of witnesses specifically called to bear witness to the demand being made. Reference must be made to the demand already made, that is, to the talab-i-mawasibat.
3. Talab-i-tamlik or khasumat: demand of possession by the person claiming pre-emption by which he finally enforces his claim by a- regular suit within the period prescribed, vide Limitation Act. Sch. I. Art.-10.

Under the Shia Law the distinction between talabi-mawasibat and talab-i-ishaad is not recognised; all that is necessary is that the pre-emptor should prefer his claim.

 

1. COMBINATION OF DEMANDS:

The pre-emptor may combine both the demands. If at time of the-first demand; the pre-emptor invokes the witnesses in the presence of the Vender or the Vendee or on the property it will suffice for both the demands.

1. DEMAND TO BE MADE BY ALL PRE-EMPTORS:

When there are more pre-emptors .then each of them should make separately both the demands unless one of them is authorized to make the demands on behalf of others when, out of several pre-emptors, only some of them have made the demand, but all of them file a suit, then the suit of those would proceed who had made the demand and the suit of others would fail.

1. WHEN THE VENDEE SELLS PROPERTY AFTER MAKING DEMANDS:

No fresh demands are required if the vendee transfers the property after making the demands. But it> is the pre-emptor who can pre-empt either on the first sale or on the second, he is free to pre-empt the second sale also.

A.ZAR-E-SAUM

Definition

Zar-e-Suam is the one third amount in cash of the total sale price under a suit of pre-emption , which the pre-emptor must deposit with the filing of the suit in the court.

 In order to succeed in a suit of pre-emption, the pre-emptor must deposit the one-third amount of total sale price in cash, otherwise, the suit would be dismissed by the court

 

In case of winning the suit of pre-emption , the pre-emptor must give a bank gurantee for deposit of balance 2/3rd of the total price in the court in case of winning the suit of pre-emption.

Limitations for depositing Zar-e-Suam

According to section 24 of Punjab Pre-Emption Act ,in every suit for pre-emption , the court shall require the plaintiff to deposit in such court , one third of the sale price of property in cash in such period as the court may fix.

Example.

Aslam files a suit of pre-emption against Naveded for certain property but does not deposit Zar-E-Saum in the court . the suit is dismissed for want of Zar-e-Saum.

Object

The object of depositing money as zar- e-suam, is to prevent and defeat the relaxation and speculative litigation.

Mode of payment         

It must be deposited-in cash with the court or with any person appointed by the court for this purpose

In case titled-Khawar Janjua vs. Yasir Ahmad", the court held that as the plaintiff did not pay the one-third amount of total sale price, hence the suit of pre-emption is dismissed.

In another case titled 'Yaqoob Khilji vs. Farooq Ali the court held that in order to succeed in a suit of pre-emption, the amount of zar-e-suam must be paid by the applicant.

Conditions for depositing zare-e-su-am

The following are the conditions to depositing zar-e-suam:-

i.The time period fixed by the court for depositing zar-e-su-am shall not extend beyond 30 days of the filing of suit.

ii.If no sale price is mentioned in the sale deed or in mutation or the price so mentioned appears to be inflated, the court shall require deposit of probable value of the property.

iii.Where the plaintiff fails to make a deposit under sub-section (I). within period fixed by the court or withdraws the sum so deposited by him, his suit shall be dismissed.

iv.Every sum deposited under said sub-section shall be available for discharge of costs

v.The probable value fixed under said sub-section shall not affect the final determination of price payable by the pre-emptor.

Deposit of balance price

 According to Section 25. where a court passes a decree in favour of pre-emptor on payment of excess price, the court shall require the pre-emptor to deposit remaining amount within thirty days of passing of decree.

Effect of non-deposit of zar-e-suam '

If the pre-emptor does not deposit the one-third amount of total price in cash, in a suit of pre-emption in the court on the date fixed by the-court or with the filing of suit, the suit of pre-emption shall be dismissed. Hence, in order to succeed in a suit of pre-­emption in a court of law the pre-emptor must deposit the zar-e- suam on the date fixed by court or with the filing of suit.

For example

Zaheer files a suit against Kama! for certain property. The court orders to deposit the zar-e-suam on a certain date. Zaheer does not deposit the said amount in the court on the date fixed. The suit will be dismissed.

Case: In case titled “Mohammad Akhtar Butter vs. Arshad Bhatti", the court held that inspite of court's order to deposit the one-third price of total sale price, the plaintiff did not deposit the said amount on the date fixed therefor. It was held that suit is liable to be dismissed.

The provisions of Islam

The law of pre-emption was made under the decision of Federal Shariat Conn of Pakistan in I990 under the cannons of injunctions of Islam.

 

1. THE LEGAL EFFECTS OF PRE-EMPTION.

Legal effect of Pre-emption are,

1. When the claim of pre-emption is complete, the pre- emptor steps in the shoes of buyer.
2. If the sale has been completed when the claim to the right of pre-emption is enforced, the original buyer becomes the new seller, and the pre-emptor as the new buyer.
3. The pre-emptor does not become liable for any contingent charges incurred by the buyer, such as brokage or agency,
4. The buyer is entitled to receive or retain the rents and profits of the land during the interval between the date of its sale to himself, and its transfer to the pre-emptor,
5. As the pre-emptor takes the property from the buyer, and not the seller,-the buyer must always be a party to the suit. But after the pre-emptor has taken possession of the land, there is no need of seller.
6. If before the sale is complete, and the pre-emptor claims it from the buyer, he may say to the pre-emptor, to take it direct from the seller,

1. WHEN RIGHT OF PRE-EMPTION IS LOST:

The right to pre-empt may be lost in the following cases:

1. By acquiescence or estoppel or waiver or forfeiture:

When the pre-emptor fails to observe necessary formalities, i.e., making two demands acquiescence takes place. There may be other circumstances also from which acquiescence on the part of the pre-emptor may be observed.

1. The right to pre-empt is lost when the pre- emptor enters into compromise with the vendee, not to claim the right of pre-emption. For example, if the pre-emptor agrees to cultivate the land which is subject-matter of pre-emption, with the vendee, then it amounts to acquiescence.
2. The right is lost when the pre-emptor permits a sale to be to another person.
3. When the pre-emptor acts as agent of the vendor in transaction then also the right is lost.

 

1. By death of the pre-emptor:

When the pre- emptor dies after making the two demands but before the filing of the suit then also the right of pre-emption is lost, his legal representatives have no right to file the suit.

1. By misjoinder:

When the pre-emptor joins himself as a co-plaintiff with a person who is not entitled to claim the right of pre-emption then also the right to pre-empt is lost. But if he joins with as co-plaintiff' a person with who could have filed a suit for pre-emption, but the reason that he did not make the two demands the right to pre-empt will not be lost,

1. By release:

When the pre-emptor releases the property for consideration to be paid to him, then also the right to pre-empt is lost. But the right of pre-emption, will not be lost even a pre-emptor has notice of the impending sale previously, but made no offer to the vendor to purchase it.

1. By ceasing to be a claimant:

The right of pre-emption of a pre-emptor must be existing on three dates:

1. the date of the sale.
2. the date of the suit for pre-emption, and
3. the date on which a decree in the suit for pre-emption is passed.

The pre-emptor ceases to be entitled to the right of pre-emption under the following circumstances,

1. If he reserves to himself the right to rescind the contract.
2. Unless a pre-emptor of a higher class allows his decree to be time-barred.
3. When the pre-emptor of a higher class, purchases the property which is the subject- matter of pre-emption, then the pre-emptor of a lower class cannot pre-empt the first sale because of his being a lower class pre-emptor.

1. APPLICABILITY WHEN PARTIES BELONG TO SHIA AND SUNNI SECT:

There are three parties involved in the pre-emption i.e. the vendor, the vendee and the pre-emptor. When all are of the same sect, then no problem arises. But when they belong to different sects, the difficulties arise. So the following three situations may arise regarding the. sect of the parties.

 

1. When the vendor and the pre-emptor belong to same sect:

 Where the vendor and the pre-emptor are of the same sect, then law of that sect will apply. For example, when both the vendor and the pre-emptor belong to the Sunni sect, then the Sunni Law of Pre-emption will apply to them.

1. When the vendor is Sunni and the pre- emptor is Shia:

Where the vendor belongs to the Sunni sect and the pre-emptor belongs to the Shia sect, then the Shia Law will apply to them. For example, where vendor is Sunni and the vendee is also Sunni but the pre-emptor is Shia, then the Shia Law will apply.

1. When the vendor is Shia and the pre- emptor is Sunni:

Where the vendor is Shia and the pre-emptor is Sunni, there is a conflict of opinion on this point. The Allahabad High Court held that in such a case also the Shia Law should apply on the principle of reciprocity. But the Calcutta High Court said that the Hanafi Law should apply, the Shia Law would apply only when both the vendor and pre-emptor are Shias.