TRNSFER OF PROPERTY LAW

A PROJECT ON __________________________________________________________

PRE-EMPTION

___________________________________________________ SUBJECT TRANSFER OF PROPERTY LAW

SUBMITTED TO MR. PROF. ALI FACULTY TRANSFER OF PROPERTY LAW ___________________________________________________ SUBMITTED BY VATSALYA VIGYA ROLL NO 179 SEMESTER III YEAR 2ND ___________________________________________________

CHANAKYA NATIONAL LAW UNIVERSITY PATNA, BIHAR.

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TRNSFER OF PROPERTY LAW

ACKNOWLEDGEMENT

I owe the present accomplishment of my project to my friends who helped me immensely with materials throughout the project and without whom I would not have been completed it in the present way. I would be like to thank my friends who helped me in many ways for the completion of this project. I would also like to thank my faculty Mr. Prof. Ali whose guidance helped me a lot. I would also like to extend my gratitude to my parents and all those unseen hands that helped me out at every stage of my project.

Vatsalya Vigya

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TRNSFER OF PROPERTY LAW

TABLE OF CONTENTS

LIST OF ABBREVIATIONS.. RESEARCH METHODOLOGY.. LIST OF CASES.. 1. INTRODUCTION 2. PRE-EMPTION 3. ORIGIN, SOURCES AND APPLICATION.. 4. ARISING OF THE RIGHT. 5. REQUISITES OF ITS ENFORCEMENT... 6. WHEN THE RIGHT IS LOST.. 7. PROCEEDINGS IN COURT. 8. SHIA LAW OF PRE-EMPTION.. 9. CONSTITUTIONAL VALIDITY. 10. CONCLUSION BIBLIOGRAPHY.

RESEARCH METHODOLOGY
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TRNSFER OF PROPERTY LAW

The project work PRE-EMPTION is based on doctrinal method of research. I have considered articles and write ups. Secondary sources have been used i.e. like books, articles commentaries and internet. The writing style is both descriptive and analytical. The project is not a result of extensive research work.

LIST OF ABBREVIATIONS
. Chanakya National Law University 4

TRNSFER OF PROPERTY LAW 1. AIR 2. All 3. AP 4. Bom 5. Cal 6. Co 7. Del 8. ed. 9. FB 10. Gau 11. HC 12. Hyd 13. Pat 14. SC 15. S 16. Vol 17. v. All India Reporter. Allahabad. Andhra Pradesh. Bombay. Calcutta. Company. Delhi. edition. Full Bench. Gauhati. High Court. Hyderabad. Patna. Supreme Court. Sections. Volume. versus.

LIST OF CASES

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TRNSFER OF PROPERTY LAW 1. Audh Bihari v. Gajadhar, AIR 1954 SC 418. 2. Dasrathilal v. Bai Dhondu Bai, AIR 1941Bom 262. 3. Md. Ismail v. Abdul Rashid, AIR 1956 All 1. 4. Ibrahim v. Muni Mir, 1870 6MHCR26. 5. Digamber Singh v. Ahmad, 42 IA 18(1915) 37All129. 6. Govind Dayal v. Inayatullah, (1885)7All 775. 7. Pasha Begum v. Syed Shabbu, 1956 Hyd 1. 8. Raja Brij Narain, Kedar Nath, AIR 1923All 57. 9. Begam v. Md. Yakub, ILR 16 All 344. 10. Begam v. Mohammed, (1894) All 344. 11. Jadulal v. Janaki Koer, (1908) 35Cal 575. 12. Radhakrishnan Laxminarain v. Sridhar, AIR 1960 SC 1368. 13. Alimon Nessa v. Sudhir Chandra Dea, AIR 1991 Gau 13. 14. Raj Krishna Bahadur v. Ganga Pd. Shah, AIR 1941 Pat 35. 15. Munni Lal v. Bishwanath Prasad, AIR 1968 SC 450. 16. Ojheoonissa v. Rusatm Ali, 1864 WR 219. 17. Bishan Singh v. Khazan Singh, AIR 1958 SC 838. 18. Chand Khan v. Niamat Khan, (1869) 3BLR AC 296. 19. Md. Hossein v. Mohsin Ali, (1870) 6BLR 41. 20. Abdullah v. Amantaullah, (1899) IL All 292. 21. Ajimulullah v. Jadav Nath, AIR 1926 Cal 685. 22. Giraj Kumar v. Irfan Ali, AIR 1932 All 688. 23. Shamsuddin v. Alauddin, AIR1932 All 138. Chanakya National Law University 6

TRNSFER OF PROPERTY LAW 24. C.S.Tiwary v. P.Dubey, (1949) Pat 861. 25. Sona bashi v. Ramdeo, 1951 Pat 521. 26. Rajendra Kumar v. Rameshwar Dass,AIR 1981 All 391. 27. Nanhi Nabbi v. Bunyadi Begam, AIR 1954 All 87. 28. Imamuddin v. Muhammad, (1930) 52 All 1005. 29. Matloo Devi v. Damoda Lal, AIR 2001 SC 2611. 30. Ajijui Rahman v. Haji Moshaid, AIR 1991 Gau 66. 31. Amir Haidar v. Ali Ahmad, AIR 1925 All 424. 32. Mohammed v. Mohammed, (1918)40 All 322. 33. Sheikh Kadratullah v. Mohinin Mohan Saha, (1869) 4BLRAC 134. 34. Rameshwar Lal v. Ramde, AIR 1957 Pat 695. 35. Bhau Ram v. Brij Nath, 1962 SC 1476. 36. Sant Ram v. Lbh Singh, 1965 SC 314. 37. Atma Baksh v. State of Haryana,(1986)2SCC 249. 38. Krishna v. State of Haryana, AIR 1994 SC 2536. 39. Razzaque Sajan v. Inrahim Hazi, AIR 1999 SC 2043.

INTRODUCTION

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TRNSFER OF PROPERTY LAW A right of pre-emption or Shufaa under Muslim Law is a personal right on the part of the pre-emptor to get a re-transfer of property from the vendee who has already become owner of the same. Although the right becomes enforceable only when there is a sale but the right exists antecedently to the sale, the foundation of the right being the avoidance of the inconveniences and disturbances which would arise from the introduction of stranger into the land.1 Thus, it is quite clear that the main object of pre-emption is preventing a stranger into the land as it can create disturbances. Thus, in a way, it restricts the owners unfettered right of transfer of property and compels him to sell it to his co-heir or neighbour as the case may be.2According to Prophet, it is morally objectionable to sell a property without offering it to pre-emptor. In Dashrathilal v. Bai Dhondu Bai,3 the HC agreed that the right of pre-emption is incident to the property. Right of pre-emption has been codified in the statutes of some of the provinces like Punjab, Agra, Oudh etc. but in other parts of India, it exists as a customary right or as a personal right. The crux of the whole thing is that the benefit as well as the burden of the right of preemption run with the land and can be enforced by or against the owner of the land for the time being although the right of the pre-emptor does not amount to an interest in the land itself.4 The right is based on the principles of justice, equity and good conscience. It, thus, creates a right which attaches to the property and on that footing only it can be enforced against the purchasers.

1 2

Audh Bihari v. Gajadhar, Air 1954 SC 418. Paras Diwan,Muslim Law in Modern India,p.267. 3 AIR 1941 Bom 262. 4 Supra1.

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TRNSFER OF PROPERTY LAW The project is divided into 10 chapters. The first chapter deals with the right of pre-emption.. The second one is about its origin, sources and application. The third chapter states about the and the fourth chapter is about the service sector. The fifth chapter is about the taxes. The seventh chapter is about the other sectors and the eight chapter deals with monetary and fiscal policy. Ninth one deals with FRBM Act and the last one is the conclusion. The project will give an answer to the following research questions: 1. What is pre-emption? 2. What is its requisites for enforcement? 3. How is it legally evaded? However, as the topic is really vast, there are certain issues which I am unable to deal with for lack of time and expertise.

PRE-EMPTION

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TRNSFER OF PROPERTY LAW Pre-emption in Arabic is termed as Shufaa which means adding. Right of pre-emption or shufa means the right possessed by one person to acquire a property sold to another in preference to that other by paying a price equal to that settled, or paid by the latter. 5 It is a sort of legal servitude running with the land. In Audh Bihari v. Gajadhar,6 the judge described it as a right of substitution entitling the pre-emptor, by reason of a legal incident to which the sale itself was subject, to stand in the shoes of the vendee in respect of all the rights and obligations arising fro the sale deed and the pre-emptors name was substituted in its place. In Mohd. Ismail v. Abdul Rashid,7 it was held that the right of 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 sol to another person. It is thus, a legal right of purchasing an immovable property before all others. The main ingredients of pre-emption thus are: 1. Pre-emption is a right by which the owner of a certain immovable property possesses to obtain proprietary possession of certain other immovable property, not his own. 2. This right is obtained in substitution for the buyer. 3. It is obtained on the same terms on which that other immovable property is sold to the purchaser. 4. The right is conferred by law for quite enjoyment of the property.

NATURE OF RIGHT OF PRE-EMPTION

5 6

Ameer Ali,Mohammedan Law, p.734. AIR 1954 SC 421. 7 AIR 1956 All 1.

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TRNSFER OF PROPERTY LAW The right of pre-emption is a preferential right which is given to the owner of the property to purchase another property adjoining to his or of which he is the co-owner or in which he is entitled to immunities or appendages.8 There was a conflict between many HCs on the issue that whether it is a right of repurchase or a right of substitution. The Calcutta and Bombay HCs considered it a right of repurchase while Allahabad and Patna HCs considered it a right of substitution.9 SC in Bishan Singh v. Khazan Singh,10 obsereved that it is a right of substitution not of repurchase, the pre-emptor takes the entire bargain and steps into the shoes of the original vendee. In Govind Dayal v. Inayatullah,11 the right of pre-emption was compared with that of easement as both goes with the land and both are in a way legal servitude running with land. The only difference is easement permits preventive relief, pre-emption does not as the purchaser can be prevented only after he purchases the property. In Durga Singh v. Girwar Dutt Joshi,12 it was held that the right of pre-emption is a weak right. It can therefore, be enforced, only when it is clearly established.

ORIGIN, SOURCES AND APPLICATION

Before the arrival of the Mughals, there was nothing like shufaa. After their arrival, the law of Shufaa was introduced and was made applicable to all people. At the time of

8 9

Aquil Ahmad, Mohammedan Law, 22nd ed., p.337. Govind Dayal v. Inayatullah, ILR 7All 775. 10 AIR 1958 SC 838. 11 ILR 7All 775. 12 AIR 1938 All 191.

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TRNSFER OF PROPERTY LAW coming of Britishers in India, this right existed as either a customary right or as a part of Muslim personal right. In Ibrahim v. Muni Mir,13 the HC rejected to enforce this right and considered it against justice. However, other HCs found it in consonance with justice, equity and good conscience. Rights of pre-emption have also been created by contract between the sharers in a village.14 This is a valuable but a weak right. Thus, the basic sources of law of preemption are as follows: 1. It is applicable as between Muslims as part of their Muslim Personal Law. 2. It exists in certain parts of country under statutes. In Punjab, it existed under Punjab Pre-emption Act, 1915 and in Agra under Agra Pre-emption Act, 1922. 3. The right of pre-emption is recognized by customs in Bihar, Sylhet etc. The Muslim Law of Pre-emption applies to Hindus except in so far as it is modified by custom. 4. It exists by contract also. Ex- A Hindu vendee and a Muslim vendor may agree that the Muslim law of Pre-emption which applies to the vendor and his shares would also apply to the vendee. The law of pre-emption thus, was introduced by Mohammedans. There is no such conception in Hindu Law as no writings of Smritikaras or later commentators mention about it.15 However, under the Muslim Law, non-Muslims are as much entitled to exercise the right of pre-emption as Muslims by legislation, custom or by contract.

APPLICATION:
13 14

1870 6MHCR 26. Digamber Singh v. Ahmad, 42 IA 18(1915) 37 All. P.129. 15 Supra 1.

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TRNSFER OF PROPERTY LAW The right of pre-emption may arise between parties of different religion or different sects. The vendor should be a Muslim. However, the vendee may be a non-Muslim according to Allahabad HC.16 The sect of the vendee is immaterial. If both the vendor and vendee are Sunnis, Sunni law will apply and if both of them are Shias, Shia Law will apply. A full bench of five judges of Hyderabad HC considered the question in Pasha Begum v. Syed Shabbu Hassan17 and decided that if the vendor is Shia and the pre-emptor is Sunni, then the right of pre-emption is not applicable as Shia law does not recognize the right of pre-emption on the basis of vicinage.

ARISING OF THE RIGHT

The right of pre-emption arises only in two types of transfer of property: Sale and exchange. The right in case of exchange arises only when it is complete, bonafide and valid. If one party will have the right to cancel the exchange at any time during its life time, then the right will not be applicable. In case of sale also, the right arises only when the sale is complete, bonafide and valid. There should be actual sale. An intention to sale can never give rise to the right. In Raja Brij Narain v. Kedar Nath,18 it was held that a private sale made by an official receiver would give rise to a right of pre-emption. In Begam v. Md. Yakub,19 it was held
16 17

Govind Dayal v. Inayatullah, 1885 7 All 775. 1956 Hyd 1. 18 AIR 1923 All 57. 19 ILR 16 All 344.

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TRNSFER OF PROPERTY LAW that no right of pre-emption arises in respect of property leased in perpetuity or mortgaged even though by a conditional sale until foreclosure of the equity of redemption. The transfer of property by a husband to his wife in lieu of dower is sale and hence the right is available. The right of making a claim arises only when the sale is complete. Under Transfer of Property Act, 1882, a sale under S-54 is not complete unless it is registered if the worth of property is more than Rs.100. But under Muslim Law, a sale is complete when the price is paid and the possession is delivered. In Begum v. Muhammad,20 a full bench of the Allahabad HC held that a sale is sale is complete in terms of Muslim Law. But in the same case Judge Bannerjee gave a dissenting judgement that the right arises only when the sale is complete in the sense of T.P.Act. In Jadulal v. Janaki Koer,21 the Calcutta HC gave the intention test to determine when the sale will be considered to be completed. The intention of the parties should be looked at in determining what system of law has been followed. The conflict was sorted out in Radhakrishnan Laxminarainan v. Sridhar,22 where it was held that the transfer of property, where the T.P. Act applies, has to be under the provisions of that Act only and Mohammedan Law or any other provisional law of transfer of property cannot override the statute.

EXTENT OF CONTINUATION OF THE RIGHT

20

1894 16All 344(FB). 1908 35cal 575. 22 AIR 1960 SC 1368.

21

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TRNSFER OF PROPERTY LAW The ground for pre-emption continues up to the date on which the decree is passed. If a plaintiff who claims this right and after the filing of suit sells off the property, then he will not be entitled to a decree because he has no title of the property. In Alimon Nessa v. Sudhir Chandra Dey,23 it was held that if the adjacent owner makes no declaration to show that the intention to assert the right of pre-emption, the right would not be available to him.

WHEN RIGHT DOES NOT ARISE The right of pre-emption does not arises out of gift, sadaqah, wakf, bequest, lease, mortgage or conditional sale. In Rajkrishna Bahadur v. Ganga Pd. Shah,24 it was held that a person in position of a tenant has no right of pre-emption. In Munni Lal v. Bishawanath Pd.,25 it was held that there must be full ownership of the land and therefore the right is not available in sale of lease hold interest in the land. If the buyer or seller repudiates the sale, then also there can be no right of pre-emption.26

23 24

AIR 1991 Gau 13. AIR 1941 Pat 35. 25 AIR 1968 SC 450. 26 Ojheoonissa v. Rustam Ali, 1864 WR 219.

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TRNSFER OF PROPERTY LAW

REQUISITES OF ENFORCEMENT

There are three requisites for the enforcement of the right of pre-emption: 1. Party competent to pre-empt. 2. Subject of pre-emption. 3. Formalities.

Parties competent to pre-empt According to Hanafi law, only three classes of persons are entitled to claim the right of pre-emption, not simultaneously, but in succession to each other.27 These three classes are:

27

Ameer Ali, Mohammedan Law, p.740.

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TRNSFER OF PROPERTY LAW 1. Shafi-i-sharik, which means a co-sharer in the property who is an owner of an undivided share in the property. 2. Shafi-i-khalit, who is a participator in appendages and immunities. The person who is entitled to right of easement is entitled to pre-empt. 3. Shafi-i-jar, who is the owner of adjoining or contiguous immovable property. Shafi-i-sharik will get a preference over Shafi-i-khalit which inturn gets preference over Shafi-i-jar. Aco-sharer has a right of pre-emption in larger estates where the rights of other two are limited. In the case of Chand Jain v. Niamat Khan,28 the owner of a piece of land, through which the land in respect of which the right of pre-emption was claimed received irrigation, was held entitled, on principle, to a preferential right to purchase against a mere neighbour. The right of pre-emption first belongs to the partner in the house, if the house belongs to two persons. If the person having preferential right waives off his right, then the person next in order will be entitled to enforce his rights. A person whose house is situated at the back of that which is sold, Jai-i-mulasik, has a better claim than other neighbours.29 In Md. Hussain v. Mohsin Ali,30 it was held by Calcutta HC that a co-sharer can claim a right of pre-emption in respect of a share in villages or larger estates but a neighbours right extends only to houses, gardens and small plots of land. In Abdullah v. Amanatullah,31 it was held that a pre-emptor is not bound to frame his suit for the whole of the property sold, but only for so much as he would be entitled to, having regards to
28 29

1869 3BLR AC 296. Supra 27,p.743. 30 1870 6BLR 41. 31 1899 IL 21All 292.

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TRNSFER OF PROPERTY LAW the claim of the other pre-emptor. In Ajimulullah v. Jadav Nath,32 it was held that to enforce the right of pre-emption the vendee should be a Mohammedan. Judge Greaves said that where no local customs exist with regard to pre-emption amongst Hindus, the Mohammedan Law of pre-emption does not apply when the person claiming the right of pre-emption and the vendor are Mohammedans and the purchaser is a Hindu. In Giraj Kumar v. Irfan Ali,33it was held that a wakif or mutawalli has no right of pre-emption on the basis of Shafi-i-jar as the title vests in God. Along with these there are certain qualifications to be fulfilled for claiming the right of pre-emption: 1. Male or Female: The person can either be a male or a female. 2. Major or minor: The person can be a major or minor. Even a child in mothers womb is entitled to get the right of pre-emption if it is born within 6 months. If the father dies before the sale, then even if it takes birth later after 6 months, he can claim the right provided he inherits the property from father. 3. Owner of immovable property: The person must be the owner of immovable property. Only an adjacent owner of some immovable property has a right to acquire by purchase another immovable property sold to another person. A tenant, lessee in perpetuity, occupancy tenant spes successionis, benamidar, grove holder etc. have no rights of pre-emption.34

Subject of pre-emption

32 33

AIR 1926 Cal 685. AIR 1932 All 688. 34 Rameshwar lal v. Ramdeo, AIR 1957 Pat 695.

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TRNSFER OF PROPERTY LAW The subject of pre-emption must be an immovable property. A house sold apart from the land on which it is built is not an immovable property. Also, the subject of pre-emption must be pre-empted as a whole. No pre-emptor can claim a part of the property sold as every pre-emptor will try to take the best part of the property. 35 However this principle is subjected to exceptions: 1. If several properties are sold by the same contract, the pre-emptor can claim the one and leave the rest. 2. If the sale includes properties which are not subjected to pre-emption, the pre-emptor may exclude them and claim the rest. 3. When there is a sale of property which belongs to two or more persons, the preemptor can choose the portion of any of them. In Shamsuddin v. Alauddin,36 it was held that if the property is subject to any mortgage and if mortgage is in possession, then the pre-emptor will get the property only on redeeming the mortgage. The subject of pre-emption is immovable property only. However, it can be either divisible or indivisible like a bath, mills, canal, houses, gardens, zamindari land etc. Under Shia law, the right of pre-emption is available only in case of divisible properties, then the right of pre-emption would arise.

Formalities

35 36

Aquil Ahmad, Mohammedan Law,p.345. AIR 1932 All 138.

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TRNSFER OF PROPERTY LAW The Mohammedan Law or Pre-emption is a law of technicality. 37 In C.S.Tiwary v. P.Dubey,38 it was held that the right of pre-emption can be exercised only on the observance of certain formalities. The three essential formalities are the three demands after hearing of the sale of property concerned. The demands are as follows: 1. Talab-i-mowassibat or immediate demand. 2. Talab-i-ishaad or confirmatory demand. 3. Talab-i-tamlik or demand for possession.

Talab-i-mowasibat The expression in Arabic means a demand by jumping. It is called so because it expresses the idea of making an immediate demand at the very moment the person comes to know about the property being sold. The first demand may be made by such words as I do claim my Shufaa. The desire to assert the right of pre-emption must be made in clear and unequivocal terms.39 The first demand can be made without the presence of witnesses. The demand can even be made by the duly authorized person. In Sonabashi v. Ramdeo,40 it was held that the de-fcto guardian of minor pre-emptor can make a valid demand. In Rajendra Kumar v. Rameshwar Dass,41 it was held that the first demand should be made within reasonable time which depends on facts of each case. The first demand has to be made after the completion of the sale.

Talab-i-ishaad
37 38

Paras Diwan, Muslim Law in Modern India, p.273. 1944 Pat 861. 39 Supra 37, p.273. 40 1951 Pat 521. 41 AIR 1981 All 391.

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TRNSFER OF PROPERTY LAW The pre-emptor should make the second demand so as to affirm that the first demand was rightly made. The second demand should be made in the presence of two witnesses expressly called to witness the demand and in the presence of vendor or buyer or on the property. In Nanhi Nabbi v. Bunyadi Begum,42 it was held that when the demand is made on the premises, it is not necessary to enter them, it is enough that one goes near and touches it and makes the demand. In Imamuddin v. Muhammad,43 it was held that the omission of the invocation addressed to witnesses was not necessary or fatal to the claim. The second demand can be made by an authorized agent if the pre-emptor is physically incapable to do so.

Talab-i-Tamlik or Talab-i-Khusumat After making the two demands, when the pre-emptor files a suit to enforce his right, then it is called the third demand.44 This right arises only if the claim is not conceded. If the preemptor is a minor, then the suit can be filed by his guardian or next friend. According to article 97 of Limitation Act, 1968, the suit for the enforcement of the right of pre-emption should be filed within one year of the vendee taking possession of the premises, or within one year of the registration of the sale deed. The period of limitation cannot be extended for the minor.

42 43

AIR 1954 All 87. 1930 52All 1005. 44 Paras Diwan, Muslim Law in Modern India , p.276

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TRNSFER OF PROPERTY LAW When a decree in a suit is passed in favour of the pre-emptor, then the property and the right of mesne profits, under order 20, rule 14, CPC vest in the pre-emptor from the date on which he pays the purchase price until that time original purchaser is entitled to retain possession and take rent and profit. There is a conflicting law in different schools regarding the question of continuing a suit by the legal representatives after the death of the pre-emptor during the pendency of the suit. The Shia and Shafi Law says that the suit can be continued by the legal representatives. According to Hanafi Law, Right to continue the suit is extinguished. But the matter is now governed by Indian Succession Act, 1925. Sec-306 of this says that the right is not extinguished and the suit may be continued by the legal representatives of the deceased preemptor.

Rules of making the demand Following formality should be strictly observed:

1. Talab-i-Mowasibat should be made after the completion of the valid sale. 2. The claim must be clearly and unequivocally asserted. 3. The demand must be made without delay. 4. The second demand must be made in the presence of two witnesses. 5. Tendering the price is not essential. It is sufficient that he should then declare his readiness to pay the price.

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TRNSFER OF PROPERTY LAW In the case of Ajijuri Rahman Barbhuiya v. Hazi Moshaid Ali Laskar45, it was held that the rules relating to Talab-i-Mowasibat and Talab-i-Ishaad must be followed for enforcing the right of pre-emption. Once the court is satisfied that the evidence produced are sufficient to show that formalities where complied with, then the right of pre-emption cannot be whitted away by insisting unreastically strict compliance of the formalities. In Matloo Devi v. Damodar Lal46 , the S.C once again has clarified the principles of Talab in Muslim Law.

WHEN THE RIGHT OF PRE-EMPTION IS LOST

The right of pre-emption is lost under the following conditions: 1. By acquiescence or waiver. 2. By death of the pre-emptor. 3. By misjoinder. 4. By release.

By acquiescence or waiver Acquiescence or waiver takes place when a pre-emptor fails to observe necessary formalities, such as the making of demands. Even if a pre-emptor enters into a compromise, then also the

45 46

AIR(1991) Gauh, 66. AIR (2001) SC 2611.

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TRNSFER OF PROPERTY LAW right of pre-emption is lost. In Amir Haidar v. Ali Ahmed,47 it was held that even if the preemptor agrees to cultivate the land with the vendee, the right of pre-emption is lost. By death of the pre-emptor Under Sunni law, the right is extinguished if the pre-emptor dies during the pendency of the suit. But under Shia Law, the right to sue may be carried on by pre-emptors heirs. By misjoinder If the pre-emptor joins himself as a co-plaintiff with a person who is entitled to claim preemption, then the right is lost and his legal representative.

By release The right of pre-emption is lost, if the pre-emptor releases the property for consideration to be paid in him. The right of pre-emption will not be lost, if the pre-emptor was given an offer before the completion of a valid sale and he rejected the offer.

The right, however, is not lost in the following cases: By the death of the pre-emptor during the pendency of the suit. By rejecting the offer to buy the property before the completion of a valid sale. By the previous notice of sale.

The right can however be legally evaded:

47

AIR 1925 All 424.

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TRNSFER OF PROPERTY LAW By leaving an unsold strip of land touching the boundary of the pre-emptors land. This will definitely not bring any stranger as his neighbour. By leasing out the property. By executing a deed of gift but with a bonafide intention.

In Mohammad v. Mohammad,48 it was held that by the Allahabad HC that Muslim Law did not recognize the device of dressing up a transaction of sale in the garb of lease so as to defeat the right of pre-emption. The devices for evading the rights were considered as abominable.

PROCEEDINGS IN COURT

In order to assert the claim to pre-emption based on custom or special agreement, the vendor and claimant must both be subject to Mohammedan Law. The Courts have conflicting views about the qualification. In Sheik Kadratullah v. Mohini Saha,49 it was held that vendee should also be Mohammedan. In Brij Mohan v. Abdul Hasan Khan,50 it was held that vendee need not be Mohammedan. In the judgement of full bench of Calcutta HC,51 it was also decided that when one co-sharer conveys his share to another co-sharer no other co-sharer if any, can have a right to pre-

48 49

1918 40 All 322. 1869 4BLR AC 134. 50 1885 IL 7All 775. 51 Lalla Lall v. Lalla Lall, 1897 IL 4 Cal 831.

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TRNSFER OF PROPERTY LAW emption the right of all being equal, and the reason on which the right is founded being therefore absent. However, Allahabad HC rejected this view.

EFFECT OF A DECREE DECLARING THE RIGHTS When two or more persons are entitled to the right of pre-emption in a particular property, each one of them can claim the property in its entirety. But if a decree has been passed in the favour of two or the decree is not passed and a person surrenders his right, then the other one does not become entitled to the share so given up or surrendered.

OPTION OF INSPECTION The pre-emptor has the right of inspection even after decree by judge. If later on he finds a defect, he has a right to reject the responsibility. However, the validity of objection should be bonafide and must not be made to harass the parties.

IMPROVEMENTS AND DETEORIATIONMADE BY THE BUYER If the buyer has made any improvement in the property, then the pre-emptor must pay their value or get them removed. In case of growing crops, the pre-emptor must pay their value or get them removed. In case of growing crops, the pre-emptor must wait for its ripening. But if there is a deteoriation in the property, then the price should be proportionately reduced. But if the deteoriation has been caused by the purchaser, then the pre-emptor must Chanakya National Law University 2

TRNSFER OF PROPERTY LAW pay the whole price or resign his claim. If the purchaser willfully breaks down any buildings, the pre-emptor may take the area of land for a proportionate part of original price. But if it is destroyed by natural causes, then he must pay the whole price. When the buildings are burnt down, then the pre-emptor must take site at the full price.

RELINQUISHMENT OF THE RIGHT The right can be relinquished expressly or impliedly. The pre-emptor may expressly forego his right of pre-emption with or without compensation. He can even relinquish it impliedly. If he omits to perform the demands without giving any sufficient cause, it can be inferred that he has relinquished his right.

SHIA LAW OF PRE-EMPTION

Under the Shia law, only co-sharers can claim the right of pre-emption. Only a partner in the property sold can claim the property by right of pre-emption. Qualifications for being a pre-emptor If the person is a minor or not of sound mind, then the right should be exercised by his guardian. If the guardian fails to make the right, then the minor on attaining puberty and insane person on recovering may assert it. A person who was absent at the time of sale, then he can prefer his claim however prolonged his absence might be. Existence of right The right comes into existence immediately on the conclusion of the contract. Even if the purchaser adds something to the price after the contract, then the pre-emptor will not be Chanakya National Law University 2

TRNSFER OF PROPERTY LAW liable for it. The pre-emptor should prefer his claim immediately after he comes to know about the contract. However, delay due to absence, illness or incarceration does not lead to extinction of the right. Acquiescence No dealing by the vendee would affect the claim of pre-emptor. Even if the property is sold to third person, the right can be claimed against him. Erections and accretions to the property If the vendee before any demand has been made, erect buildings or plant trees, then he should take up the trees without leveling the ground. The pre-emptor can however take it at full price or relinquish his rights absolutely. However, if an accretion is made to the property which forms part of it, then it would belong to pre-emptor but if it is separable, then it would belong to vendee. Right of pre-emption heritable The right devolves by inheritance upon heirs. If one heir relinquishes his right, the other might take the whole property. The right attaches to immovable property. By damage here means such injury which would render the property useless after partition.

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DIFFERENCE BETWEEN SUNNI AND SHIA LAW 1. As to who can claim the right: Under Shia law, a co-sharer can claim the right of preemption whereas under Sunni law, a co-sharer, a participator in appendages and owner of adjoining lands are entitled to claim the pre-emption. 2. As to right to sue: Under Sunni law, if the pre-emptor dies before getting a decree, the right is extinguished, however, in Shia law, the suit may be continued by thr\e pre-emptors heirs. 3. As to abatement of price: Under Sunni law, if the vendor make an abatement of price after completion of sale, the pre-emptor can claim the benefits of abatement under Shia law, he cannot claim the benefit of abatement of price. 4. As to the number of demands: Under Sunni law, Talab-i-mowasibat and talab-iishaad are two conditions precedent to the exercise of the right of pre-emption. Under Shia law, the distinction between two demands is not recognized, however the preemptor must use reasonable diligence without any unnecessary delay.

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CONSTITUTIONAL VALIDITY
Before 44th amendment of Constitution Before 44th Amendment of Constitution, the Art. 19(1) (f) existed in the Constitution which gave the right to acquire, hold and dispose of property. Article 19(5) permitted a law to impose reasonable restrictions on exercise of this in the interests of general public or for the protection of Schedule Tribes. Art. 13(1) declared that all laws which are inconsistent with the provisions of the Constitution shall be void to such extent of inconsistence. Art 13(2) declared that any law made which abridges Fundamental Right will be void. The validity law of pre-emption thus, depended on the reasonable restrictions imposed. The pre-emptory right of co-sharer is justified as it prevents disintegration of Muslim family property. SC in two cases held a statutory or customary right of pre-emption to be void but approved the validity to a co-sharer and participator in appendages. In Bhau Ram v. Brij Nath,52 it was held that the pre-emption on ground of vicinage is unconstitutional. It was held that the restrictions imposed are not reasonable and prevents the vendor to sell his
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1962 SC 1476.

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TRNSFER OF PROPERTY LAW property to anyone for any price that may be settled between him and vendee. It promotes litigation also. However, it upheld the validity of the right of pre-emption between cosharers as the restrictions were in interest of public. In Sant Ram v. Labh Singh,53 it was held that customary right of pre-emption on ground of vicinage is against Art. 19(1)(f) and hence, it is constitutionally void.

After 44th Amendment However, after 44th amendment, Art. 19(1)(f) itself has been abrogated, therefore, after this right of pre-emption on ground of vicinage has been revived. Therefore, right of pre-emption is still a legal right. In Atma Prakash v. State of Haryana,54 SC held that claim of preemption on ground of consanguity is ultra vires the Constitution. In Krishna v. State of Haryana,55 the constitutionality of right of pre-emption was raised again under Punjab Preemption Act, 1923.The court held that right of pre-emption to co-sharer is valid. In Razzaque Saja v. Ibrahim Hazi, it was held that right of pre-emption on ground of neighbour is unconstitutional. Thus, after 44th Amendment, the right is a legal right.

53 54

1965 SC 314. 1986 2SCC 249. 55 AIR 1994 SC 2536.

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CONCLUSION

It can be concluded that right of pre-emption is possessed by one person to acquire property sold to another in preference to that other at the same price. The law of pre-emption is historically speaking, a product of the Mohammedan world. It came to be enforced after the advent of Muslims. To start with it was accepted as a part of custom and was applied by the courts, particularly in Northern India accordingly. It also received statutory recognition in Section-22 of Hindu Succession Act, 1956. However, it was declared to be a weak right. If the provision is present in Hindu Law also, then a better option is to make the law uniform for the whole country. The right should be given a place in the Uniform Civil Code. It is better to have a uniform sect of law rather than having different sets of law for each sect. Pre-emption is considered a weak right by the courts. So, for the enforcement of this right, the formalities must be properly adhered to. The right as itself leaves scope for legally evading it Most of the times the measures like leaving an unsold strip of land defeats the very purpose of the right. So, judiciary should interpret the law in such a way that it cannot be misused. Finally, this right even though fetters the right of the owner of the property, is accepted by the courts as it aims at preventing the strangers from entering the premises. Chanakya National Law University 3

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BIBLIOGRAPHY

BOOKS REFERRED: Aquil Ahmad, Mohammedan Law, 22nd ed., Central Law Agency. Ameer Ali, Commentaries on Mohammedan Law, 5th ed., Hind Publising House, Allahabad. Mulla, Mohammedan Law, 1st ed., 2007, Dwivedi Law Agency, Allahabad. M.Hidyatullah v. Arshad Hidyatullah, 5 Principles of Mohammedan Law, 19th ed., Lexis Nexis, Butterworths. Paras Diwan, Muslim Law in Modern India, 9th ed., Allahabad Law Agency.

WEBSITES REFERRED: 1. www.yahoo.com. 2. www.wikipedia.com. 3. www.manupatra.com. 4. www.legalserviceindia.com. 5. www.findlaw.com.

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