Bank of Punjab, flat owners challenge IHC verdict on One Constitution Avenue lease cancellation

ISLAMABAD: The Bank of Punjab (BoP) and several flat owners of the capital’s iconic One Constitution Avenue project have filed separate intra-court appeals before the Islamabad High Court (IHC), challenging a single bench verdict that upheld the cancellation of the project’s lease and ruled that third-party buyers would “sink or sail” with the original lessee.

The decision of the single bench, which had dismissed BNP (Private) Limited’s writ petition and upheld the cancellation of the lease, has now been challenged before the IHC’s divisional bench. The Bank of Punjab filed an intra-court appeal against the single bench’s decision, though the Registrar’s Office has raised objections regarding the maintainability of the appeal.

The development marks the latest turn in a longstanding legal battle over the 13.5-acre commercial-residential project located at the end of Constitution Avenue, adjacent to the Convention Centre.

On April 30, 2026, a single-member bench of the IHC dismissed the petition filed by builder M/s BNP (Private) Limited, the original lessee, and upheld the Capital Development Authority’s (CDA) decision to terminate the lease over alleged multi-billion-rupee payment defaults.

Appeals filed against ruling that upheld CDA action and linked third-party buyers’ rights to original lessee

The single bench headed by the Chief Justice rejected BNP Company’s application and restored the lease cancellation order. The court also ruled that third-party sub-lessees and purchasers would “sink or sail” with BNP, meaning their rights were dependent on the lessee’s interest.

In its appeal, the Bank of Punjab requested that the single bench’s decision be declared illegal and contrary to the facts. The bank stated that it has a direct stake in the matter, as BNP Company had obtained a loan from the Bank of Punjab and subsequently paid the amount to the CDA.

According to documents available with Dawn, the Bank of Punjab had acquired three floors on sub-lease to establish a branch. A total of 25,420 square feet of space was acquired for the bank in One Constitution Avenue.

The bank was allotted space on the lower ground, upper ground and first floors on sub-lease.

The appellants, including overseas Pakistanis and other bona fide purchasers, have also challenged the judgment to the extent that it affects their vested proprietary rights.

Through their counsel, they requested the divisional bench to declare that the impugned judgment does not authorise the CDA to dispossess, evict or take coercive action against them without due process.

The appellants have heavily relied on Supreme Court of Pakistan orders dated January 9, 2019 and November 6, 2019, which directed the CDA to submit a “viable, fair, transparent, secure and enforceable arrangement” for settling third-party claims.

A notification issued on May 1, 2026 had also barred coercive action pending the prime minister’s final decision.

The divisional bench is expected to take up the appeals for hearing in due course.

Published in Dawn, May 12th, 2026