Khadim Hussain vs Rahim Bakhsh etc.

Stereo. H C J D A-38.

JUDGMENT SHEET

IN THE LAHORE HIGH COURT, MULTAN BENCH,

MULTAN

JUDICIAL DEPARTMENT

Civil Revision No.1031-D of 2016

Khadim Hussain

Versus

Raheem Bakhsh & others

JUDGMENT

Date of hearing: 10.09.2026.

Petitioner by: Mr. Muhammad Masood Bilal, Advocate. Respondents by: Mr. Muhammad Adnan Khan, Advocate.

MUHAMMAD SAJID MEHMOOD SETHI, J.:-

This consolidated judgment shall dispose of instant revision petition along with connected revision petition i.e. C.R. No.1032-D of 2016 as common questions of law and facts are involved in these cases.

2.Through these revision petitions, petitioner has assailed the judgments and decrees dated 24.05.2016 passed by the learned Additional District Judge, Muzaffargarh, whereby the appeals filed by respondents No.1 to 3 were accepted, the judgments and decrees dated 14.10.2011 passed by the learned Civil Judge, Muzaffargarh, were set aside and the suits for specific performance were decreed.

3.Briefly stated, respondents Nos.1 to 3 instituted suits for specific performance and possession against respondent No.4, Muhammad Abbas, in respect of the disputed properties on the basis of agreements to sell. The petitioner, Khadim Hussain, was subsequently impleaded as transferee of the properties through mutations dated 31.03.2003. The respondents alleged that the petitioner had knowledge of the prior agreements and that the

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subsequent transfers were mala fide, whereas the petitioner contested the suits as a bona fide purchaser for value without notice. The learned Trial Court found the agreements to sell proved but declined specific performance against the petitioner and awarded compensation against respondent No.4. The learned Appellate Court, however, reversed the judgments and decrees of the learned Trial Court and decreed specific performance in favour of respondents Nos.1 to 3. Hence, the present revision petitions.

4.Learned counsel for the petitioner submits that the learned Appellate Court committed a material illegality in reversing the Trial Court's finding regarding the petitioner's bona fide purchase without notice. He contends that the learned Appellate Court itself noticed the petitioner's statement that he had no knowledge of the earlier agreements, yet proceeded to observe that there was no issue or evidence regarding bona fide purchase. He further argues that the learned Appellate Court failed to determine the question of notice, which was essential before specific performance could be enforced against a subsequent purchaser. He maintains that the impugned judgment consequently suffers from misreading/non-reading of evidence, failure to give reasons for reversal and material irregularity in the exercise of appellate jurisdiction. Conversely, learned counsel for the respondents supports the impugned judgment and submits that the agreements to sell were duly proved through the evidence of the concerned witnesses and, being prior in time to the subsequent transactions, were enforceable against the subsequent purchaser. He argues that the learned Appellate Court rightly held that the earlier transactions prevailed over the subsequent transfers.

5.Arguments heard. Record perused.

6.The controversy can appropriately be resolved on a short but decisive question: whether, after finding the agreements to sell proved, the learned Appellate Court was justified in granting specific performance against the petitioner without properly determining his plea of bona fide purchase for value without notice and without

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lawfully reversing the contrary finding recorded by the learned Trial Court.

7.The execution of the agreements is not the real controversy before this Court. In the main matter, the learned Trial Court examined the evidence of the stamp vendor, notary public, scribe, marginal witnesses and the parties and concluded that agreement Ex.P.1 had been established. Similarly, in the connected matter, the finding regarding execution of the agreement dated 21.11.2002 was also accepted. The question, therefore, is not merely whether respondents Nos.1 to 3 established their agreements against the original vendor. The material question is whether those agreements were enforceable against the petitioner, who claimed to be a subsequent purchaser for value, in good faith and without notice of the earlier transactions. Proof of the agreement against the original vendor and its enforceability against a subsequent transferee are two distinct questions, requiring separate determination.

8.The learned Trial Court answered the latter question in favour of the petitioner. It did not simply dismiss the suits of respondents Nos.1 to 3 on the ground that their agreements had not been proved. Rather, it drew a distinction between the liability of the original vendor and the rights of the subsequent purchaser. Upon appraisal of the evidence, the learned Trial Court found the petitioner to be a bona fide purchaser for consideration without notice and, consequently, declined specific performance against him while granting monetary compensation against the original vendor. This finding assumes significance because it was not an incidental observation but a material finding directly determining the petitioner's liability to specific performance.

9.The learned Appellate Court was undoubtedly competent, as the first Court of appeal, to re-appraise the evidence and to reach a conclusion different from that of the learned Trial Court. However, where a material finding forming the basis of the decree is reversed, the learned Appellate Court is required to identify the evidence relied

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upon by the learned Trial Court, examine the reasons supporting its conclusion and record cogent reasons for disagreeing with it. The power of re-appraisal does not dispense with the obligation to provide reasons, particularly where the finding sought to be reversed concerns the bona fide status and absence of notice of a subsequent purchaser and directly affects the relief of specific performance.

10.In the main revision petition, the impugned judgment itself reveals the material defect. The learned Appellate Court, while discussing the evidence, expressly noticed the statement of the petitioner, Khadim Hussain, that he had purchased the disputed property from respondent No.4 and that he had no knowledge of agreement Ex.P.1 when he purchased the property. The judgment further notices the petitioner's acquaintance with the scribe and one of the marginal witnesses. Having noticed this evidence, the learned Appellate Court subsequently observed that “There is no issue of bona-fide purchase of the disputed property and no evidence has been led on this point.”

11.The aforesaid observation is inconsistent with the record as reflected in the very judgment under challenge. The petitioner's statement was evidence on the question of his knowledge, while the learned Trial Court had specifically considered the question of his bona fide status and had returned a finding in his favour. Thus, the learned Appellate Court proceeded upon a premise contradicted by the evidence noticed by it itself. The error cannot be characterized as a mere difference in appreciation of evidence. More importantly, the learned Appellate Court did not identify any material evidence establishing that the petitioner had actual or constructive notice of the previous agreement, nor did it explain why the learned Trial Court's finding regarding absence of notice was erroneous. The question of notice or knowledge was a factual controversy arising from the pleadings and evidence and could not be assumed or bypassed. The august Supreme Court in Muhammad Bashir and others v. Chiragh Din through Legal Heirs and others (2003 SCMR 774) recognized

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the question whether subsequent purchasers had knowledge or notice of the prior transaction as a factual controversy requiring determination on the basis of the evidence. Likewise, in Muhammad Siddique (deceased) through L.Rs. v. Muhammad Yaqoob and others (2024 CLC 1764), the Lahore High Court, while considering the claim of a subsequent bona fide purchaser, emphasized the significance of the evidence concerning prior knowledge and the purchaser's denial thereof in determining entitlement to protection under sections 41 of the Transfer of Property Act, 1882 and 27(b) of the Specific Relief Act, 1877. In the present case, however, the learned Appellate Court neither properly determined that factual controversy nor identified evidence sufficient to dislodge the learned Trial Court's finding that the petitioner was a bona fide purchaser for value without notice. The judgment, instead, proceeded upon the general proposition that “the first transaction will supersede the second transaction.” Such proposition, without first determining the status and statutory protection of the subsequent transferee, could not furnish a sufficient basis for granting specific performance against him.

12.The same defect is evident in the connected revision petition. There, the learned Appellate Court expressly held that the agreement dated 21.11.2002 had been proved, but thereafter concluded that “If the agreement is proved, it is enforceable against both the respondents.” The conclusion treats proof of the earlier agreement as automatically determinative against the subsequent purchaser. However, respondents Nos.1 to 3 had themselves alleged that the petitioner had knowledge of the previous agreement, whereas the petitioner specifically denied such knowledge and claimed the status of a bona fide purchaser in possession. This controversy required an independent determination on the basis of the evidence. The learned Appellate Court did not record any specific finding establishing notice on the part of the petitioner in the connected matter either, nor did it

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demonstrate why the learned Trial Court's conclusion protecting the subsequent purchaser was factually or legally erroneous.

13.The observation that the petitioner could recover the price of the land from respondent No.4 does not answer the anterior legal question whether the petitioner could, in the first place, be compelled to perform an agreement to which he was not the original contracting party. The distinction between the original vendor and a subsequent transferee is fundamental. The original vendor, being the alleged executant of the agreement, may be bound by it upon its proof. A subsequent transferee, however, stands on a different legal footing, and his liability to specific performance depends upon the statutory conditions governing such transferee, including consideration, good faith and absence of notice of the earlier contract. Consequently, proof of the agreement against the original vendor does not, by itself, establish the entitlement of respondents Nos.1 to 3 to specific performance against the subsequent purchaser.

14.Section 27(b) of the Specific Relief Act, 1877, is directly attracted to this aspect of the controversy. The statutory protection available to a transferee for value who has acted in good faith and without notice cannot be bypassed merely by establishing that the plaintiffs' agreement was earlier in point of time. In Inayatullah Khan and others v. Shabir Ahmad Khan (2021 SCMR 686), the august Supreme Court held that a decree for specific performance may not be issued against a transferee for value who has acquired the property in good faith and without notice of the pre-existing contract. It was further explained that the subsequent transferee initially bears the onus of establishing the requisite ingredients of such protection, including acquisition for consideration, good faith and absence of notice, whereafter the burden shifts to the plaintiff to establish notice of the original contract. Thus, the issue is one which has to be determined on the basis of the pleadings and evidence. The august Supreme Court in Muhammad Yousaf v. Allah Ditta and others (2021 SCMR 1241) likewise recognized the significance

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of the circumstances attending the subsequent transaction, including payment of consideration and acquisition of possession, in determining the protection available to a bona fide purchaser. Similarly, in Zakia Begum and others v. Nasir-ul-Islam Khan and others (2022 SCMR 2130), the august Supreme Court emphasized, while considering protection available to subsequent purchasers, the relevance of consideration, good faith and reasonable care/due diligence in determining entitlement to statutory protection. More recently, in Tanveer Mehmood Awan v. Atif Haseeb and another (2026 CLC 1104), the Lahore High Court, Rawalpindi Bench, protected the rights of a subsequent purchaser who had succeeded in establishing her bona fide status, notwithstanding the earlier agreement relied upon by the original vendee. These authorities reinforce the principle that the status of a subsequent purchaser is a fact-sensitive matter which cannot be determined merely by the chronological priority of the earlier agreement. In the present case, once the petitioner specifically raised the plea of bona fide purchase for value without notice and the learned Trial Court accepted that defence upon appraisal of evidence, the learned Appellate Court was required to determine that question afresh if it intended to reverse the finding. It could not dispense with that exercise by treating proof or priority of the earlier agreement as sufficient, in itself, to make the agreement enforceable against the subsequent purchaser.

15.The approach adopted by the learned Appellate Court also falls short of the requirements of Order XLI Rule 31 CPC. While reversing the Trial Court's decree, the first Appellate Court was required to address the material questions arising for determination, consider the evidence bearing upon those questions and record reasons for its conclusions. This obligation assumed particular significance because the learned Trial Court had returned a specific finding in favour of the petitioner on the very issue which ultimately determined his liability. A reversal of that finding required an examination of the evidence

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relating to consideration, good faith and notice and a reasoned explanation as to why the Trial Court's conclusion was unsustainable. The impugned judgments do not adequately explain why that finding was erroneous. The omission is not merely procedural; it goes to the basis upon which the Appellate Court exercised its jurisdiction.

16.It is also significant that the learned Trial Court's approach did not result in denial of all relief to respondents Nos.1 to 3. Having found the agreements proved, it declined specific performance against the petitioner on account of his bona fide purchase without notice, while awarding compensation against respondent No.4, the original vendor, in the sum of Rs.1,20,000/- in the main matter and Rs.70,000/- in the connected matter. Thus, the learned Trial Court maintained the distinction between the contractual liability of the original vendor and the statutory protection claimed by the subsequent purchaser. Its approach was therefore not based on rejection of the respondents' agreements, but on the legally distinct status claimed by the petitioner as a subsequent purchaser. No legally sustainable basis has been demonstrated by the learned Appellate Court for displacing that approach.

17.This Court is conscious of the limited scope of revisional jurisdiction under Section 115 CPC. Interference with findings of fact is not warranted merely because another view of the evidence is possible. The present case, however, does not involve a mere difference of opinion or a simple re-appraisal of evidence. The learned Appellate Court reversed a material finding concerning the petitioner's bona fide status without properly examining the evidence bearing upon consideration, good faith and notice and, in the main matter, proceeded on a premise inconsistent with the evidence noticed in its own judgment. In the connected matter, it treated proof of the earlier agreement as sufficient to render the same enforceable against the subsequent purchaser without independently determining the latter's statutory protection. Such failure goes to the manner in which the

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appellate jurisdiction was exercised and constitutes material irregularity warranting interference under Section 115 CPC.

18.For the foregoing reasons, this Court is satisfied that the judgments and decrees dated 24.05.2016 passed by the learned Additional District Judge, Muzaffargarh, cannot be sustained. The learned Appellate Court failed to properly determine the petitioner's plea of bona fide purchase for value without notice, failed to furnish cogent reasons for displacing the learned Trial Court's finding in that regard and, in the connected matter, proceeded on the erroneous premise that proof of the earlier agreement, by itself, rendered it enforceable against the subsequent purchaser. The impugned judgments, therefore, suffer from material irregularity in the exercise of appellate jurisdiction and call for interference in revisional jurisdiction.

19.Consequently, instant C.R. No.1031-D of 2016 and connected C.R. No.1032-D of 2016 are allowed. The judgments and decrees dated 24.05.2016 passed by the learned Additional District Judge, Muzaffargarh, in the respective appeals are set aside, and the judgments and decrees dated 14.10.2011 passed by the learned Civil Judge, Muzaffargarh, are restored. No order as to costs.

(Muhammad Sajid Mehmood Sethi) Judge

APPROVED FOR REPORTING

Judge

*A.H.S.*