Right Of Pre-Emption Is A 'Very Weak Right'; Pre-Emptor's Conduct Can Constitute Waiver: J&K&L High Court

The High Court of Jammu & Kashmir and Ladakh has held that the right of pre-emption is a very weak right, one that can be defeated by a purchaser through all lawful means and can even be deemed waived by the pre-emptor through his or her conduct as inferred from the facts and circumstances of the case.The court added that once a pre-emptor chooses to waive his right of pre-emption, he loses that right forever and could not raise the right in perpetuity every time there is a subsequent transaction or sale.Justice Sanjay Dhar made these observations while allowing an appeal that challenged a 2001 decree of prior purchase passed by the District Judge, Poonch.Background:The case arose out of a dispute over a house and an adjoining piece of land in Poonch town, originally jointly purchased in 1976 by the plaintiff, Durga Devi, and Roop Chand, father of Isher Dass, predecessor-in-interest of the proforma respondents. According to the plaintiff, although both sides occupied one room each and no formal partition took place, the property remained un-partitioned. In 1987, she learned that Isher Dass was negotiating the sale of his share to appellant Iqbal Singh, following which she served a notice under Section 19 of the J&K Right of Prior Purchase Act. Despite this notice, the sale was executed for Rs.40,000, prompting her to sue for enforcement of the right of pre-emption.The defendants contested the suit, claiming that the property had in fact already been partitioned and that the plaintiff had herself admitted this in an earlier injunction suit, which she later abandoned. They argued that the plaintiff had waived her right of pre-emption through conduct and that her failure to pursue that remedy earlier barred the fresh action.The trial court decreed the suit for pre-emption under clause “secondly” of Section 15 of the Act, holding that although the property stood partitioned, it constituted a single house/building, thereby attracting the statutory right of prior purchase. The plaintiff was granted a decree of possession subject to depositing Rs.40,000, an amount she did deposit, though this fact briefly led the High Court, in 2023, to set aside the decree on the assumption that the deposit had not been made. Upon review and verification of the trial record, the appeal was restored for fresh hearing.Before the High Court, the pivotal question was whether the plaintiff had waived her right of pre-emption by filing and abandoning the earlier injunction suit without invoking that right, despite knowing about the sale deed and having already served a notice under Section 19.Justice Dhar examined the record in detail and noted that the plaintiff's own statement before the trial court revealed that she had filed the injunction suit in 1987 after learning of the sale but chose not to seek enforcement of pre-emption, limiting herself only to allegations that the appellant was attempting to encroach upon her portion. She later allowed that suit to be dismissed for non-prosecution. This, the Court held, was conduct clearly giving rise to an inference that she had abandoned or waived her pre-emptive right.The Court drew extensively from precedents, including Mool Chand v. Ganga Jal, Bishan Singh, Barasat Eye Hospital, Raghunath v. Radha Mohan, and Indira Bai v. Nand Kishore, all of which emphasise that pre-emption is merely a right of substitution, inherently weak in nature, and one that courts approach with reluctance because it interferes with an owner's freedom to alienate property. Quoting these decisions, Justice Dhar reiterated that pre-emption “can be defeated by all legitimate methods” and that “estoppel by conduct” applies even to statutory rights under the pre-emption law.The Court found that the plaintiff's silence on the issue of pre-emption during her earlier litigation, her omission to disclose that earlier suit in the plaint of the present suit, and her conduct in permitting the appellant to believe she would not challenge the sale particularly as he even demolished and modified the purchased structure during pendency of that earlier suit amounted to clear evidence of waiver. Justice Dhar held that these circumstances “safely establish” that the plaintiff had abandoned her right of pre-emption.The bench sharply criticised the trial court for ignoring this crucial aspect, observing that it had proceeded solely on the assumption that the property was a single house without examining the plaintiff's conduct, which had “an important bearing on the fate of the suit.”Further, the Court found that ordering possession after the passage of 38 years since the 1987 sale particularly when the appellant had continuously possessed and altered the property would be “highly inequitable,” especially given the weak nature of the right of pre-emption and its direct impact on the constitutional right to acquire and hold property. Justice Dhar also noted that the J&K Right to Prior Purchase Act now stands repealed following the ...

Right Of Pre-Emption Is A 'Very Weak Right'; Pre-Emptor's Conduct Can Constitute Waiver: J&K&L High Court

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