J&K High Court Overturns 38-Year-Old Decree, Rules Right of Pre-emption Can Be Waived by Conduct

Srinagar, J&K – In a significant ruling on property law, the High Court of Jammu & Kashmir and Ladakh has set aside a trial court decree that was passed over two decades ago, holding that the statutory "right of prior purchase" or pre-emption can be waived by the conduct of the person claiming it. Justice Sanjay Dhar allowed an appeal pending since 2001, emphasizing that pre-emption is a "very weak right" and can be defeated by the doctrine of estoppel.

The court overturned the judgment of the District Judge, Poonch, which had granted possession of a property to the plaintiff, Durga Devi, based on her pre-emption claim against the purchaser, Iqbal Singh, after a legal battle spanning nearly four decades.

Background of the Dispute

The case originates from a property in Poonch Town, jointly purchased in 1976 by Durga Devi and the predecessor of the proforma respondents. In 1987, the co-owner, Isher Dass, sold his share to Iqbal Singh for Rs. 40,000.

Following the sale, Durga Devi filed a suit asserting her right of prior purchase on multiple grounds, including being a co-sharer in an un-partitioned property. The trial court, in its 2001 judgment, found that while the property had been partitioned, Devi still held a right of pre-emption because the property constituted a single building under the J&K Right of Prior Purchase Act. It decreed the suit in her favour, conditional on the payment of the sale consideration.

Key Arguments in the High Court

The appellant, Iqbal Singh, primarily argued that Durga Devi had waived her right to pre-emption through her actions. His counsel, Mr. K. L Pandita, pointed out that:

- After the sale in 1987, Devi first filed a suit for a permanent injunction against Singh, only alleging a risk of encroachment.

- In that initial lawsuit, she was fully aware of the sale but made no mention of her intention to exercise her right of pre-emption.

- She later abandoned the injunction suit and filed the pre-emption suit nearly a year later, just before the limitation period expired.

This conduct, the appellant argued, led him to believe she had acquiesced to the sale, thereby estopping her from later claiming the right.

Conversely, Ms. Mehrukh Syedan, representing Durga Devi, contended that the right of pre-emption was a statutory right that could not be defeated or waived by mere conduct or admission.

Court's Analysis: A Weak Right Defeated by Estoppel

Justice Sanjay Dhar, in his detailed judgment, framed the central issue as whether the plaintiff had waived her right by her conduct. The court embarked on a thorough analysis of the nature of the right of pre-emption, citing landmark Supreme Court judgments including Bishan Singh v. Khazan Singh and Indira Bai v. Nand Kishore .

The High Court reiterated the established legal position that the right of pre-emption is:

- A "very weak right" that acts as a "clog on the right of the owner to alienate his property."

- A right of substitution, not repurchase, which courts generally view with "certain amount of distaste."

- A right that can be defeated by all legitimate means, including waiver and estoppel.

The court observed that estoppel is a rule of equity that prevents a person from taking advantage of their own misleading conduct. In this case, Devi's actions had a clear impact. The judgment noted:

> "This conduct of the plaintiff/respondent No. 1 allowed the appellant to believe that she had waived her right of pre-emption. In fact, there is evidence of record to show that the portion of the house which had been purchased by the appellant was demolished by him during the pendency of the suit for injunction... This circumstance shows that by the conduct of the plaintiff, the appellant was made to believe that she has waived her right of pre-emption thereby prompting him to change the nature of the suit property."

The court found that the trial court had committed a "grave error" by ignoring this crucial aspect of waiver, which had been specifically pleaded by the defendants.

Final Verdict and Equitable Considerations

In allowing the appeal, the High Court also highlighted the gross inequity of enforcing the decree after such a long passage of time. The judgment stated:

> "Apart from the above, it will be highly inequitable to grant decree of possession of the suit property in favour of the plaintiff at this stage when more than 38 years have elapsed since the purchase of the suit property by the appellant... Asking him to vacate the said property by paying him a meagre sum of Rs.40,000/-... would result in grave injustice to the appellant."

The court also took judicial notice of the fact that the J&K Right to Prior Purchase Act has since been repealed, further underscoring that the right is no longer favoured in law.

Ultimately, the appeal was allowed, and the trial court's judgment and decree from 2001 were set aside. The amount deposited by Durga Devi is to be refunded to her.