The Punjab Pre-emption Act - Rights of pre-emption ( Haq Shufa):
Like other rights, the right of pre-emption, has to be regarded in a two fold aspects, such as:
(1) As a primary or inherent right.
(2) As a secondary or remedial right.
Primary right: The right to have an offer of an intended sale is inherent to the pre-emptive property and continuously attached with it and passes along-with it to transferees, assignees, legal representatives, and heirs. In other words, it is a right attached to the pre-emptive property and is inseparable from it. This right is capable of transfer by the transfer of the pre-emptive property.
Secondary right: It does not vest in the property at the date of sale.
Priority right: For the purpose of right of pre-emption claim, the claimant has to show his preferential right to acquire the property, as it is the first important condition of pre-emption.
Possession of priority right: Pre-emptor has to posses his priority right to acquire the property at the three crucial dates:
1. At sale: Pre-emptor is required to posses his priority right at the time of sale of the relevant property. If his right of superiority is created after the sale has been conducted and possession has been transferred, he loses his right.
2. At institution of lawsuit: Where the lawsuit is instituted in or against his favour, he must posses priority right. He loses his right where his right is created after the institution of suit.
3. At decree: Right of pre-emption should be of his superior right when decree is passed in his favour being preferential right. Where the plaintiff does not posses a preferential right, he does not posses prior right to purchase suit property.
Equal right: Where both pre-emptor and vendee have right at par, there will be no priority of any right. Both are required to share their rights equally, as it is most equitable.
Priority in the right of pre-emption: Where there are more than one participators in a special interest, the person having special interest shall have first right over the person having general right.
Example: Where two persons claim pre-emption, nearer shall have precedence over the pre-emptor having such property not so near to the immovable property sold.
Persons having priority right of pre-emotion: Following is the preferential right of pre-emption:
1. Co-owner : Co–owner of undivided property has a first right for pre-emption. This property should be sold property. Where the property has been divided or is moveable or is unsold and belong to urban or cantonment area, the right of pre-emption shall not be created as first right.
2. Participator in special rights : Where the special rights attached to the immovable property exist, the concerned person shall have second right of pre-emption. These special rights include right of passage, passage of water, or right of irrigation.
3. Neighbour : Where sold property is adjacent to immovable property belonging to other who is neither co-owner nor possesses special interest in the property sold, but on the grounds of neighborhood, the right of pre-emption is created. This is third priority right and establish-able in the absence of former two priority rights.
Conditions of pre-emption: Pre-emption is subject to two conditions. Mere preferential right of pre-emption is insufficient if it lacks one of two conditions, i.e., real need or avoidance of injury.
1. Real Need: Right of pre-emption, even preferential right of pre-emption is not maintainable where pre-emptor does not have real need to exercise the right of pre-emption. If he is not in need of subject property, he cannot claim right of pre-emption. It requires real need of the person who alleges right of pre-emption.
2. Avoidance of injury: Where there is not cause of injury to the interest of pre-emptor or not reasonable apprehension to cause injury to the interest of alleged pre-emptor, right of pre-emption shall not be exercisable. It is another essential requirement of the right of pre-emption. This right is exercisable where interest of property may put in injury, and there is need to avoid it from injury.
Repugnancy: It is held in case that the preferential right of pre-emption on the ground of special interest in property such as, right of passage, right of passage of water, or right of irrigation is contravene (clash, oppose, defy, contradict) to the Islamic injunctions.
Demand of pre-emption right u/s 13: The right of pre-emption extinguishes where demand of pre-emption is not exercised in the manner prescribed and within the stipulated time period provided. This demand should follow some rules and order. The rules and order are as follows:
1. Immediate demand: Where sale proceed is not conducted in the presence of its preferential right holder and he comes to know in a meeting that the subject immovable property has been sold, he should immediately declare his intention to acquire such property. Any reasonable statement or words may show his intention, such as, “I was wanted to acquire that property” or “I was interested in that property and still interested”. Specific words are no more necessary. Mere indicative intention is sufficient.
Notice of demand: Where a person passes his indicative intention to acquire such property, he requires bringing out this intention into the knowledge of vendee. This notice should be written and attested by two truthful witnesses. This notice is to be sent to vendee by registered mail under “Acknowledgement Due”. Where sufficient postage arrangements are not available, he should demand right of pre-emption in the presence of two truthful witnesses.
2. Demand by evidence: Where alleged pre-emptor has sufficient evidence to establish his claim or preferential right, he may demand his right of pre-emption by establishing evidence. In such demand he has to send written and attested notice by two truthful witnesses to vendee. This notice is sent by post under “Acknowledge Due”, confirming his intention to exercise the right of pre-emption. Where post office facilities lack, he may demand such right in the presence of two truthful witnesses.
Cost incurred by vendee: It is notable that if vendee has incurred some cost for the improvement of property before demand by establishing evidence, he may claim such cost if pre-emptor succeeds in his right of pre-emption. Although this demand is in accordance to and conform Tradition, but this provision is repugnant to the Injunctions of Islam.
3. Demand by litigation: Where pre-emptor has fulfilled the requirements of immediate demand and demand by establishing evidence, may file lawsuit in the Court of competent jurisdiction to enforce his right of pre-emption. Right of pre-emptor should stand till the issuance of decree from Court. If pre-emptor alienates the property on the basis of which he claims the right, his right shall extinct.
Death of pre-emptor: Death of pre-emptor does not extinct his priority right who demands his right before death by the any way prescribed under this Act. His demand is might be immediate demand or demand by establishing evidence or demand by litigation. His right of pre-emption over the immovable property transfers to his legal heirs.
Limitation of notice period: In case where right of pre-emption is exercisable through immediate demand or demand by establishing evidence, notice must be served to vendee within two weeks from the date of such knowledge or establishing right by evidence.
Limitation of suit: There are four provisions under which pre-emptor may file lawsuit for the enforcement of his right of pre-emption within four months. Such provisions are as under:
1. Registration: Where sale deed has been got registered, date for suit commences from the date of such registration.
2. Attestation of mutation: If the sale is made other than registered deed, limitation shall commence from the date of attestation of mutation.
3. Physical possession: If sale is made other than registration deed or mutation, date of limitation shall take effect from the date of taking such physical possession of vendee.
4. Knowledge of pre-emptor: Where sale is not conducted either by registered deed, mutation, or physical possession, knowledge of pre-emptor shall be the determinant factor for the purpose of limitation. Limitation shall commence from the date of such knowledge of pre-emptor.
Determination of price: Where there is dispute for the determination of price, there are two determinant factors of price of property such as:
1. Payment in good-faith: Where Court feels that the payment has been made or fixed in good-faith and it is most equitable, Court shall order for such price.
2. Market value: Where Court finds that payment remains unpaid or unfixed, the Court shall determine the price according to market rate. Pre-emptor shall pay such market price determined by Court.
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