LI Network
Published on: February 7, 2024 at 12:50 IST
In a recent development, the Supreme Court has elucidated that tenants possess the right to pre-emption concerning ‘urban immovable property’ under the Punjab Pre-Emption Act of 1913.
The Court emphasized that a tenant’s entitlement to pre-emption cannot be nullified by a subsequent buyer of urban immovable property, citing a state government notification restricting tenant suits for pre-emption within municipal limits.
The case involved tenants claiming pre-emption rights over an urban property with existing constructions. The subsequent purchasers argued that the tenants were barred from filing a pre-emption suit due to the property falling within municipal limits, as per the government’s notification.
Justices C.T. Ravikumar and Rajesh Bindal, affirming the tenant’s pre-emption right, discerned a crucial difference between ‘land’ and ‘immovable property.’
The Court, aligning with lower courts, maintained that the tenant’s right to pre-emption persisted because the notification only curtailed pre-emption for the sale of land within municipal areas. The term ‘immovable property’ was construed to encompass more than just the land itself.
The Court highlighted, “The immovable property is more than the land on which certain construction has been made.”
The dispute arose when tenants, in continuous possession since 1949, filed a pre-emption suit, asserting their preferential right to purchase the property sold to subsequent owners. The trial court ruled in favor of the tenants, a decision upheld by the High Court.
Challenging this in the Supreme Court, the subsequent owners contended that the right of pre-emption was negated by the government’s 1985 notification barring such rights for land sales within municipal limits in Haryana.
Examining the notification and the Punjab Pre-Emption Act, the Supreme Court determined that the disputed property was urban immovable property. It clarified that the 1985 notification only deprived the right to pre-emption for land within municipal limits, not for immovable property, as claimed by the tenants.
The Court emphasized, “The immovable property would be more than the land only or the land on which the construction has already been made.”
Rejecting the appellants’ argument that the tenant’s suit was time-barred, the court noted that this issue was not raised before lower courts. Consequently, finding no merit in the appeal, the Supreme Court dismissed the Civil Appeal.
