Legal Principle & Question Decided

Ruling Summary: This decision was rendered by the Lahore High Court (Honorable Mr. Justice Muhammad Sajid Mehmood Sethi), officially reported as 2026 LHC 3085. In this matter between the Petitioner and the Respondent, the court adjudicated key questions of statutory construction, procedural regularity, and legal precedent under Pakistani law.

Core Holding: The honorable bench evaluated governing statutory provisions and judicial authorities to establish the rights of the parties, delivering the binding reasoning set out below.

Full Judgment Text & Judicial Ruling

COURT: Lahore High Court (Honorable Mr. Justice Muhammad Sajid Mehmood Sethi) DECISION DATE: 12-05-2026 CASE DETAILS: Civil Revision 1373/24 ============================================================ Stereo. H C J D A-38. JUDGMENT SHEET IN THE LAHORE HIGH COURT, LAHORE JUDICIAL DEPARTMENT

C.R.No.1373 of 2024

Muhammad Naseer & others Versus Muhammad Ali Syed & another J U D G M E N T Date of hearing: 12.05.2026. Petitioners by: Mr. Muhammad Javed Iqbal Qureshi, Advocate. Respondents by: Mr. Asad Mehmood Khan, Advocate for respondent No.2. M/s Syed Taqi Raza Askari and Usman Azam Gondal, Advocates for respondent No.4. MUHAMMAD SAJID MEHMOOD SETHI, J .- Through this revision petition, the petitioners have challenged the validity of two concurrent judgments and decrees: first, the judgment dated 09.06.2022 passed by the learned Civil Judge 1st Class, Lahore, and second, the judgment dated 15.12.2023 passed by the learned Additional District Judge, Lahore, whereby the petitioners' suit for declaration and cancellation of Rectification Deed bearing Document No. 8768, Bahi No. 1, Volume No. 3438 dated 31.05.2014, registered with Sub -Registrar, Allama Iqbal Town, Lahore, together with a prayer for permanen t injunction, was dismissed as not maintainable on the ground that the Civil Court lacked jurisdiction under Section 54 of the Co -operative Societies Act, 1925 ('the Act'). RELEVANT FACTS 2. The Petitioners are joint owners and possessors of Plot No. 20- B (Old)/23 (New), Block -B, Phase -I, Aitchison College Staff Cooperative Housing Society Ltd., Raiwind Road, Lahore ('the 2 C.R.No.1373 of 2024

Society'). They purchased the said plot from its previous owner, Mst. Musarrat Zohra Bukhari, daughter of Syed Qasim Ali Shah, who herself held title vide Sale Deed bearing Document No. 1057, Bahi No. 1, Volume No. 240 dated 01.02.1987. The petitioners' ownership was duly acknowledged by the Society through transfer letters bearing reference Nos. P -136-15/ACHS(MS.17), P -138-15 and P-140-15 dated 30.01.2016, issued by the then president of the Society. In the year 2014, respondent No. 1, the Ex -President of the Society, allegedly executed a Rectification Deed (Document No. 8768 dated 31.05.2014) in which the plot number of the petitioners was fraudulently incorporated and altered. The petitioners allege that at the time of execution of the impugned Rectification Deed, respondent No. 1 was no longer the President of the Society; his membership had in fact been cancelled by the Registrar Co -operatives, Punjab, consequent upon an arbitral award of Rs. 4,89,00,000/ - passed against him, which was maintained up to the level of the august Supreme Court of Pakistan. The respondent thus had neither the authority nor the legal standing to execute an y instrument on behalf of the Society. Further, a fourth respondent, Zahid Naseer Khan, claiming to be the owner of the disputed plot as an heir of Muhammad Ali Khan, was impleaded during the pendency of the appeal before the learned Additional District Ju dge, Lahore, through an application under Order I Rule 10 of the CPC, which was accepted vide order dated 30.03.2023. Respondent No. 4 is not a member of the Society. 3. The petitioners filed a suit for declaration and cancellation of the impugned Rectification Deed before the Civil Court, Lahore, on 23.02.2022. The learned Trial Court, however, vide judgment dated 09.06.2022, rejected the plaint under Order VII Rule 11 CPC, holding that jurisdiction of the Civil Court was barred by Section 54 of the Act a nd that the petitioners were required to approach the Registrar Co -operatives. The appeal filed before the 3 C.R.No.1373 of 2024

learned District Judge, Lahore, was also dismissed vide judgment dated 15.12.2023, affirming the Trial Court's view. The petitioners are now before this Court in revision. ARGUMENTS OF THE PARTIES 4. Learned counsel for the petitioners contend s that the Civil Court is vested with plenary jurisdiction to adjudicate upon the suit as the matter involves complicated and intertwined questions of law a nd fact, including forgery, fraud and misrepresentation . He submits that the cancellation of a registered instrument is exclusively within the domain of the Civil Court under Section 39 of the Specific Relief Act, 1877, and the Registrar Co -operatives has no power to cancel a registered document . He argues that the dispute does not fall within the ambit of 'business of the society' as contemplated under Section 54 of the Act . He adds that the presence of respondent No. 4, a non -member of the Society, as a necessary party renders the Registrar's forum wholly incompetent . He further submits that the suit could not have been rejected summarily at the threshold under Order VII Rule 11 CPC where triable issues of fraud, forgery and title are involved. He has placed reliance upon Mrs. Zaibunnissa v. Muhammad Sajid and 2 others (PLD 2009 Karachi 133) and Muhammad Younas Khan Lodhi v. Secretary, Government of the Punjab, Cooperatives Department & 4 Others (PLD 2011 Lahore 102). 5. Learned counsel for respondents contend that the matter pertains to the business of the Society as both parties are members or past members thereof. They submit that Section 70-A of the Act creates an express bar on Civil Court jurisdiction and that Section 54 of the Act mandates referral of the dispute to the Registrar . They argue that the learned Courts below correctly rejected the plaint as not maintainable before the Civil Court. The y further submit that the petitioners were required to approach the Registrar as a condition precedent before invoking Civil Court jurisdiction. 4 C.R.No.1373 of 2024

6. Arguments heard. Available record perused. ISSUES FOR DETERMINATION 7. In the light of the rival contentions and the record, the following questions arise for determination by this Court: (i) Whether the Civil Court has jurisdiction to entertain a suit for declaration and cancellation of a registered rectification deed on grounds of fraud and forgery, or whether the jurisdiction is exclusively vested in the Registrar Co -operatives under Section 54 of the Co - operative Societies Act, 1925? (ii) Whether the rejection of the plaint under Order VII Rule 11 CPC was legally sustainable where the plaint disclosed triable issues of fraud, forgery, and cancellation of a registered instrument? (iii) Whether the presence of a non -member party (Respondent No. 4) renders the forum of the Registrar Co-operatives incompetent for adjudication? (iv) Whether the concurrent findings of the two courts below suffer from an error of law warranting interference by this Court in revisional jurisdiction? ANALYSIS AND DISCUSSION A. Scope of Section 54 of the Act 8. Section 54 of the Co -operative Societies Act, 1925, provides a mechanism for arbitration of disputes touching the business of a cooperative society arising between its members, past members, o fficers, agents, or servants. The provision, as reproduced in the impugned judgments, requires referral of such disputes to the Registrar for decision by himself or his nominee. However, this Section is not a blanket ouster of civil court jurisdiction; it operates within defined and circumscribed boundaries. The scope of Section 54 is confined to disputes 'touching the business of a society.' The language of the section is not unlimited. It does not purport to transfer to the Registrar the adjudication of m atters which, by their very nature, lie beyond the administrative and quasi -judicial competence of that office. The Registrar is an executive functionary armed with 5 C.R.No.1373 of 2024

limited statutory powers, including the power to decide disputes inter se members regarding cooperative affairs. He is not a court of law, and no power has been conferred upon him by statute to cancel a registered deed executed before the Sub -Registrar under the Registration Act, 1908. 9. Furthermore, the proviso to Section 54 itself envisions situations where the matter involves complicated questions of law and fact, in which case the Registrar 'may, if he thinks fit, suspend proceedings until the question has been tried by a regular suit.' The very existence of this proviso is a statutory acknowledgment that there are disputes , particularly those involving title, fraud, and complex legal questions , which are inherently unsuitable for resolution by the Registrar and which are properly within the domain of the Civil Court. The scope of section 54 of the Act was well elaborated by the august Supreme Court in Sikandar Ahmed Ghouri v. Syed Rafat Abbas Jafferi and others (PLD 2025 Supreme Court 449 ), wherein it was held by august Supreme Court that: 8. Thus, it is settled law that not all disputes arising between a society and its members, officers, or employees fall within the ambit of Section 54 of the Act. Had it been the legislative intent to confer juris -diction upon the Registrar in all such disputes, the qualifying condition that a dispute mu st "touch the business of the society" would have been superfluous and devoid of any meaningful effect. The presence of this qualification necessarily implies a distinction between disputes that are intrinsically related to the business of the society and those that are not. 9… 10. The dispute in the present case pertains to ownership rights of the property, which is a question of title. Title disputes are civil in nature and cannot be adjudicated by the Registrar under the Act. The Society had already tra nsferred ownership through duly executed and registered legal instruments, as mentioned in the preceding paragraphs. Once property rights have been transferred the society no longer retains an interest in the property, and subsequent ownership disputes mus t be settled by a civil court of competent jurisdiction. Disputes relating to ownership, title, and possession of immovable property do not fall within the purview of the society's business. The mere fact that the disputed property was once allotted or tra nsferred through the registered lease deed 6 C.R.No.1373 of 2024

by the co -operative society does not automatically render the dispute one that "touches the business of the society". The expression ‘touching the business of the society’ occurring in Section 54 of the Act cannot be interpreted so expansively as to include every dispute having some remote connection with a cooperative society. The present controversy essentially concerns the validity of a registered rectification deed, competing proprietary claims, and allegations of fraud and want of authority. Such matters transcend ordinary internal management or business affairs of the society and primarily involve adjudication of civil rights relating to immovable property. B. The Exclusive Jurisdiction of Civil Court to C ancel Registered Instruments 10. The most decisive and legally conclusive argument advanced on behalf of the Petitioners is grounded in Section 39 of the Specific Relief Act, 1877. That provision reads: “When the instrument is void or voidable against t he plaintiff, and when, if left outstanding, it may cause him serious injury, he may sue to have it adjudged void or voidable; and the Court may, in its discretion, so adjudge it and order it to be delivered up and cancelled.” 11. The relief of cancellat ion of a registered instrument is a civil remedy of the highest order, and it is assigned by Parliament exclusively to the Civil Court. The word 'Court' in Section 39 of the Specific Relief Act means a Civil Court of competent jurisdiction. It does not and cannot include the Registrar Co-operatives, who exercises statutory administrative functions and whose jurisdiction is confined to the specific provisions of the Co -operative Societies Act, 1925. The Registrar has no power to direct the Sub -Registrar to c ancel or expunge a registered document from the record of the Registration Office. Only a decree of a Civil Court can constitute the basis for such cancellation. 7 C.R.No.1373 of 2024

12. The impugned Rectification Deed was registered with the Sub-Registrar, Allama Iqbal Town, Lahore, under the Registration Act, 1908. A registered document carries a statutory presumption of correctness and creates a permanent public record. The cancellation of such a document requires adjudication by a competent Civil Court under Section 39 of the Specific Relief Act, 1877, read with the general jurisdiction of Civil Courts under Section 9 of the Code of Civil Procedure, 1908. Any contrary interpretation would effectively deprive a litigant of an efficacious remedy against a registered instrument allegedly procured through fraud merely because the parties are connected with a cooperative society. In Amir Jamal and others v. Malik Zahoor -ul-Haq and others (2011 SCMR 1023 ), wherein a registered document was cancelled by the High Court in its writ ju risdiction under Article 199 of the Constitution of Islamic Republic of Pakistan 1973 , said order was set aside by the august Supreme Court by holding that jurisdiction to cancel a registered document vests on ly with the civil court. Relevant extract is provided below: “7. We have heard the learned counsel and have also perused the record. In exercise of writ jurisdiction, question of title of a property cannot be gone into by the High Court. The scope of Article 199 is dependent on the questions which are devoid of factual controversy. A registered instrument can only be cancelled by a civil court of competent jurisdiction on the ground of fraud or otherwise. Section 39 of the Specific Relief Act provides that a party which seeks cancellation of a register ed instrument has to file a civil suit by approaching the civil court of competent jurisdiction and writ jurisdiction in such matters is barred.” C. Fraud and Forgery — Proper Forum for Adjudication 13. The Petitioners' suit is not merely a dispute abo ut membership rights or cooperative affairs in the conventional sense. The gravamen of the Petitioners' case is fraud and forgery: that Respondent No. 1, at the time of execution of the Rectification Deed, was no longer the President of the Society 8 C.R.No.1373 of 2024

and who se membership had been cancelled; that he had no authority whatsoever to execute any instrument on behalf of the Society; and that the deed was executed fraudulently with the intent to deprive the Petitioners of their lawfully acquired property. These are grave allegations that require thorough examination through the mechanism of a formal civil trial , examination and cross-examination of witnesses, production and analysis of documentary evidence, and the application of the law of evidence. 14. It is a well -settled principle of law that where allegations of fraud, forgery, and misrepresentation are involved, the Civil Court alone is competent to adjudicate upon such allegations. Reliance is placed upon decision of august Supreme Court rendered in Sultan Hass an Khan and 2 others v. Mst. Nasim Jahan and 17 others (1994 SCMR 150) “3…. The question therefore to be considered would be whether forgery and fraud have been committed by the petitioners' predecessor-in-interest in obtaining P.T.D. in his favour. Such question cannot be decided by the departmental authorities. Where question of fraud, forgery or misrepresentation is involved, unless specifically barred under law, the jurisdiction remains with the Civil Court to decide such issue.…” An arbitrator or quasi -judicial authority like the Registrar Co - operatives is not equipped with the procedural machinery, the coercive powers, or the legal authority to make a finding of fraud, which is a serious determination with far -reaching civil and potentially criminal co nsequences. The jurisdiction of the Registrar under Section 54 is limited to the business of the cooperative society in the ordinary administrative sense , it cannot ordinarily be expanded to adjudication of serious allegations involving fraud, forgery, and misrepresentation requiring detailed evidentiary inquiry. 15. This Court in the case titled Aamir Iftikhar Khan v. Province of Punjab through Secretary Co -operatives Punjab 9 C.R.No.1373 of 2024

etc. (WP No. 22367/2021) , decided on 21.09.2021, has clearly enunciated the princi ple that where fraud, forgery, and tampering of record are alleged, the matter has to be tried by the competent Civil Court after recording of evidence. The impugned judgments of both the learned Courts below have failed to appreciate this binding principle and have, with respect, committed a material error of law in dismissing the petitioners' suit at the threshold. D. Non-Member Party — Section 54 Inapplicable 16. Section 54 of the Act governs disputes between members or past members of the society, or between members and officers, agents, or servants of the society. Respondent No. 4, Zahid Naseer Khan, who was impleaded as a necessary party during the pendency of the appeal, is not a member of the Society. He claims title to the disputed plot as an h eir, which is an independent claim based on succession and property law, entirely outside the ambit of cooperative society law. 17. The presence of a non -member as a necessary party to the suit renders the forum of the Registrar Co -operatives wholly incompetent to adjudicate the dispute in its entirety. The Registrar has no jurisdiction over non-members of the society. A forum that cannot bind all necessary parties cannot render a complete, effective, and binding adjudication. To compel the Petitioners to approach the Registrar , a forum that has no jurisdiction over respondent No. 4 , would effectively deprive them of a complete and efficacious remedy. Under such circumstances, the Civil Court, which has jurisdiction over all parties, is the only competent and appropriate forum. E. Premature Rejection Under Order VII Rule 11 CPC 18. Order VII Rule 11 of the CPC provides that the plaint shall be rejected where it does not disclose a cause of action, or 10 C.R.No.1373 of 2024

where the suit appears from the statement in the plain t to be barred by any law. The test to be applied at this stage is whether, taking the averments in the plaint as true and correct, the suit discloses a triable cause of action. The Court is not required to look beyond the four corners of the plaint at the threshold stage. The principles governing the adjudication of cases involving rejection of a plaint were comprehensively expounded by the august Supreme Court in President, Zarai Taraqiati Bank Limited, Head Office, Islamabad v. Kishwar Khan and others (2022 SCMR 1598 ), in the following words: “9. It is unequivocally visible that the respondent employees have not approached the civil Court for any declaratory decree against the termination or dismissal of service or damages but only seeking declaratory decree and injunctive relief against the imposition of penalty and its recovery. It is well settled that Order VII, Rule 11, C.P.C. enlightens and expounds rejection of plaint if it appears from the averments articulated in the plaint to be barred by any l aw or disclosed no cause of action. The court is under obligation to must give a meaningful reading to the plaint and if it is manifestly vexatious or meritless in the sense of not disclosing a clear right to sue, the court may reject the plaint. With the aim of deciding whether the plaint discloses cause of action or not, the court has to perceive and grasp the averments made in the plaint and the accompanying documents. In case of any mix question of law and facts, the right methodology and approach is to let the suit proceed to written statement and discovery and determine the matter either on framing preliminary issues or regular trial…” The petitioners' plaint discloses: (i) a clear cause of action based on fraud and forgery; (ii) a prayer for cancellation of a registered instrument under Section 39 of the Specific Relief Act, 1877; (iii) a claim of title and possession based on documented transfer; and (iv) a threat of injury from the outstanding fraudulent deed. These are manifestly triable issues. In the peculiar facts of the present case, the question whether the suit is barred under Section 54 of the Act could not have been conclusively determined without proper examination of the nature of the relief claimed and the allegations raised in the plaint. The summary rejection of the plaint under Order VII 11 C.R.No.1373 of 2024

Rule 11 CPC was therefore legally impermissible and constitutes a grave error of jurisdiction by the learned Trial Court, affirmed in error by the learned Appellate Court. F. The Principle of Section 9 CPC — Presumption in Favour of Civil Court Jurisdiction 19. Section 9 of the Code of Civil Procedure, 1908, establishes the foundational principle of civil court jurisdiction: 'The Courts shall (subject to the provisions herein contained) have jurisdiction to try all suits of a civil nature excepting suits of which their cognizance is either expressly or impliedly barred.' The ouster of civil court jurisdiction is never to be presumed; it must be expressly enacted by the legislature or necessarily implied from the statutory scheme. Any ambiguity in the language of an ousting provision must be resolved in favour of the Civil Court's jurisdiction. Principle of ouster of jurisdiction of Civil Court was reiterated by the august Supreme Court in Messrs Sui Nort hern Gas Pipelines Limited (SNGPL) v. Messrs Noor CNG Filling Station (2022 SCMR 1501). Relevant text is provided infra: “9.… Under section 9 of C.P.C., the Civil Courts have the jurisdiction to try all suits of a civil nature excepting suits of which their cognizance is either expressly or impliedly barred. The ouster of civil court jurisdiction cannot be straightaway inferred or congregated in a routine, save as the conditions laid down are fulfilled. The presumption of lack of jurisdiction may not be gathered until the specific law enacted by the legislation debars Court from exercising its jurisdiction with specific remedy within the hierarchy which may attain the finality of order or the controversy involved… .” Section 54 of the Co -operative Societies A ct, 1925, does not expressly bar the jurisdiction of the Civil Court in respect of matters involving fraud, forgery, or the cancellation of registered instruments. To read such a bar into the section would be to extend the ouster of jurisdiction beyond wha t the legislature has enacted. This Court is not permitted to do so. The 12 C.R.No.1373 of 2024

jurisdiction of the Civil Court to adjudicate upon the suit of the petitioners must accordingly be upheld. H. Section 70-A of the Act — Not Attracted to the Present Controversy 20. The respondents have placed considerable reliance upon Section 70-A of the Act, which bars the jurisdiction of courts or other authorities to adjudicate upon matters that the Registrar or other statutory authorities are empowered to determine under the Act, the Rules, or the bye -laws. This argument, though forcefully advanced, is misconceived on a straightforward analysis of the statute. 21. Section 70-A bars jurisdiction only in matters which the Registrar is empowered to determine. The enquiry is t herefore anterior and logically prior: what is the Registrar empowered to determine? The Registrar's powers under Section 54 and related provisions are confined to disputes touching the ordinary business of the society between its members. As established i n the preceding sections of this judgment, the Registrar is not empowered to: (i) cancel a registered instrument executed before the Sub -Registrar; (ii) adjudicate conclusive allegations of fraud and forgery requiring a full evidentiary trial; or (iii) exercise any jurisdiction over non-members of the society. Since these three elements are the very substance of the present controversy, the precondition of Section 70-A, that the Registrar must be empowered to determine the matter , is simply not satisfied. T he bar contained in Section 70 -A is therefore not attracted to the present case, and the respondents' reliance upon it is misplaced. I. ERRORS COMMITTED BY COURTS BELOW 22. The learned Trial Court committed the following identifiable errors of law: (i) it decided the jurisdictional issue without any evidence on record, based solely on the averments 13 C.R.No.1373 of 2024

of the plaint, without applying the correct Order VII Rule 11 test; (ii) it failed to consider whether the dispute fell within the proviso to Section 54 involvin g complicated questions of law and fact; (iii) it failed to consider that the relief of cancellation of a registered instrument is exclusively within the domain of the Civil Court under Section 39 of the Specific Relief Act, 1877; (iv) it failed to conside r that respondent No. 4 is a non - member of the Society over whom the Registrar has no jurisdiction; (v) it failed to undertake the anterior analysis required…

Read the unabridged text and precedent citation network on Al Wakeelo Legal Research Platform.

Related Legal Research & Directories

• Browse all judgments from Lahore High Court (Honorable Mr. Justice Muhammad Sajid Mehmood Sethi)
• Search Pakistani statutes: Constitution of Pakistan 1973, PPC, CrPC, CPC & Family Laws
• Analyze this case with Al Wakeelo AI Legal Assistant