Law of Pre-emption and Gift of Property

REAL ESTATE & CONSTRUCTION

white and red wooden house miniature on brown table
white and red wooden house miniature on brown table
Whether right of pre-emption arises when gift of property is made?

It is now well settled that the right of pre-emption arises when the sale of land occurs. The sale, per the definition provided in Section 2(d) of the Khyber Pakhtunkhwa Pre-emption Act, 1987, does not include a gift.The right of pre-emption does not arise when gift of property is made.

Whether validity of transaction is examined in a suit of pre-emption?

In a suit for pre-emption, the validity of the transaction is not examined; however, the nature of the transaction may be determined.

Whether law of pre-emption can be evaded by devices or disguise?

A marked distinction exists between a devise and disguise. Device is permitted but not disguise. When transaction has been given a false colour to evade third party rights, it is not only the function but also duty of the Court to remove veil, see through disguise and then to determine real and true character of transaction. A person is also equally entitled to evade law of pre-emption by all lawful and legitimate devices, like gift, exchange etc.

What is appropriate course for a party who challenges a sale through suit for pre-emption but a second/subsequent gift transaction also exists?

So, in the given circumstances of the case, respondent/plaintiff could not ignore the gift mutation while making his demand. The appropriate course for him was to say, firstly, that the second transaction was a sale, but to defeat his right of pre-emption, it had been dubbed as a gift; and secondly, that he had made all the requirements of Talbs regarding the second transaction.

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