livelawpk.com - LHC Lifts Restriction on Issuance of Fard Malkiat Amid CVT

Lahore High Court Lifts Restriction on Issuance of Fard Malkiat Amid CVT Dispute

5 months, 4 weeks
237

Lahore High Court Lifts Restriction on Issuance of Fard Malkiat Amid CVT Dispute

Islamabad 24-06-2024: In a significant ruling, the Lahore High Court's Bahawalpur Bench has lifted the restriction on the issuance of Fard Malkiat (ownership document) to Ghazanfar Amin, the petitioner in the [Writ Petition No. 7027/2022]. The judgment, delivered by Mr. Justice Tariq Saleem Sheikh, declared the Sub-Registrar's action prohibiting the issuance of the Fard Malkiat as unlawful.

The case revolves around a land transaction involving Muhammad Rizwan Sohail (Respondent No. 4), who owned 46 kanals of land, and Asif Rasheed, who owned 2 kanals. They collectively exchanged their 48 kanals of land with the petitioner's land in Mauza Mehmoodpur, District Bahawalnagar. The petitioner developed a housing scheme named Mubarak Town on this land.

Upon applying for the Fard Malkiat to sell plots in Mubarak Town, the petitioner was denied by the Halqa Patwari due to an outstanding Capital Value Tax (CVT) of Rs. 25,024,000, allegedly unpaid by Respondent No. 4 on a General Power of Attorney executed in 2016.

The petitioner filed a writ petition under Article 199 of the Constitution, challenging the legality of the notice demanding the CVT and seeking the issuance of the Fard Malkiat.

The Court determined that the petitioner qualifies as an “aggrieved party” under Article 199, making the petition maintainable. The Court emphasized that CVT, imposed under Section 6 of the Punjab Finance Act, 2012, should be strictly construed. It highlighted that the petitioner acquired the land through an independent transaction not involving the disputed General Power of Attorney. The recovery process lacked a valid assessment order, and necessary parties were not given an opportunity to be heard, casting doubt on its legality.

The Court ruled that the Sub-Registrar's prohibition on issuing the Fard Malkiat to the petitioner was without lawful authority. The restriction was lifted, allowing the petitioner to obtain the Fard Malkiat. However, the judgment permits the respondents to pursue the recovery of the allegedly unpaid CVT from the liable parties, subject to due legal process.

This ruling clarifies the application of CVT in land transactions and reinforces the requirement for due process in tax recovery proceedings. The decision underscores the importance of proper legal procedures and fair treatment of property owners. This judgment is seen as a significant step in ensuring justice and protecting the rights of landowners in Punjab.