Interim Relief In Tax Cases

INTERIM RELIEF IN TAX CASES INTERIM RELIEF IN TAX CASES By MANSOOR AHMAD KHAN, Senior Advocate, Supreme Court of Pakistan In answer to a question in a superior Court as to what was his standing, the advocate replied, that it was barely 3 years. The Judge, much surprised, said he had seen him for the last 40 years and back came the retort that 37 years had been spent in waiting for his cases and cooling heels. It is a part of a daily routine to sit and watch the Court proceedings, of which the bail proceedings attract greater attention. The lawyers plead for bails, inter alia, in cold‑blooded calculated first degree murders, in gruesome dacoities and heinous offences in kidnapping of minor, in the rapes of even of innocent minor girls and other despicable offences against the society. The thought of a bail being granted, in such appalling circumstance, is repulsive but to the trained mind, there is room for consideration for the interim period, during which the alleged offender is presumed innocent. Even if convicted by the first Court, the appellate Courts are entitled to and grant the interim reliefs, including bails. Those charged with such murders, dacoities, kidnappings, rapes and heinous offences, until or if convicted, in the appellate proceedings are, in appro priate cases, known to be granted bails. A bail is an interim relief. 2. While criminal cases arouse notice and sympathy, the story of interim relief in civil and allied matters is as much an essential necessity and has not gone unnoticed. It is through the medium of equitable relief by ad interim and interim injunctions teat such relief is secured. A tenant is liable for ejectment in case of default in the payment of rent. In the ejectment proceedings and until the final remedy of appeal, he may be given the protection through stays by the first to the ultimate Court of appeal. Similarly, in regard to almost all civil disputes, where it is proved by affidavit or otherwise that any property in dispute is in danger of being wasted, damaged or alienated by any party to the suit or wrongfully sold in execution of a decree, or is threatened or intended to be removed or disposed off with a view to defraud creditors, in such or similar events, a civil Court is empowered to grant ‑temporary injunction and to restrain such act or make such other order for the purpose of staying and preventing the wasting, damaging, alienation, sale, removal or dispossession of the property as the Court may think fit until disposal of the suit or until further orders therein. 3. Interim relief is the core of justice. It is not difficult to realise why. No condemned person will be hanged before he has availed his ultimate legal rights of appeal, hence, the interim relief. No property are allowed to be wasted, alienated or wrongfully used and similarly no legal rights will be allowed to be limited, if they are before a Court and until decided, need protection during the interim period. All such interim reliefs are of extreme consequence and have been pragmatically provided for in all fields, including those which extend to the civil and criminal jurisdiction. 4. However, the question of interim relief in the field of revenue has been isolated and made to stand on a different footing. This is being felt with growing concern principally on two counts. Firstly, the executive hierarchy, being essentially tax collectors with ingrained denial for interim relief, is the authority to grant stay against its own illegal and arbitrary assessments and demands; and secondly, in the appellate jurisdictions, either there is no vested power or it is limited to inefficacy, The first appellate forums are extracted from the executive and are directly sub ordinate to and under the control of the Central Board of Revenue and are known to shirk displeasure, making such judicial proceedings wholly illusory or even diabolic. In the case of Anwar Ali v. Province of Sind, Constitutional Petition No. 614 of 1984, the Chief Justice of the Sind High Court, dealing with the capital gains tax authorities hearing judicial appeals, made observation which would be read with interest when he referred to the independence in decisions by public functionaries making quasi‑judicial orders but having no option but to give 'command performance because he knows that by arriving at such conclusions which are different from the conclusions of the panel, he may be guilty of gross disobedience and thereby exposing himself to displeasure of the superior authorities... renders remedies by way of appeal and revision virtually illusory'. 5. It may be useful to recapitulate how a tax demand is raised and what are the subsequent executive and judicial remedies available under the law. Considering this aspect under the Income‑tax Ordinance, 1979, s tax demand is raised with the completion of assessment in the ordinary cases, there however, being other tax liabilities in special cases. In the service of notice of the tax demand, a date is given for payment which is the prerogative of the Income‑tax Officer. The demand may be stayed by the Inspecting Assistant Commissioner 'till such time as he thinks fit or allow the payment of tux in such instalment as he may determine'. A similar executive power may be exercised by the Commissioner of Income tax or the Central Board of Revenue whose instructions are binding on all income‑tax authorities. The executive thus enjoys and has unlimited power for stay and grant of instalments. 6. Coming to the judicial forums, the Appellate Assistant Com missioner/the Commissioner (Appeals) is the first appellate authority before whom, it is specifically provided that 'no appeal shall lie from any order of assessment unless the tax payable has been paid'. The second and final appellate authority is the Appellate Tribunal. Notwithstanding the appeal having been filed before the Tribunal, tax shall, unless recovery thereof has been stayed by the Tribunal, be payable in accordance with assessment made in the case with the proviso, however, that hire recovery of tax has been so stayed, such order of the Tribunal shall cease to have effect on the expiration of 3 months following the date on which it is made. 7. From the Tribunal or the final appellate authority's order, a reference is provided to the High Court. The reference jurisdiction is merely advisory and, therefore, not having, the power to grant an interim relief or stay. The final appeal from an order in reference lies with the Supreme Court. In the provisions relating such appeal there is no specific provision relating to the powers of the Supreme Court in the matter of interim relief or stay (which it has under its inherent and constitutional jurisdiction). 8. Even in the constitutional jurisdiction of the High Court, exercised in the extreme cases where an order, any act done or proceeding taken is impugned as having been done or taken without lawful authority and a declaration is sought that it is of no legal effect, if the matter pertains to revenue and the challenge is to the legality of the order proper, even in such cases, sub‑Article (4‑A) of Article 199 of the‑ Constitution lays down that an interim order can be granted only after giving notice to the law officer of the Federal Government and such interim relief, as is thereby granted shall, in any case cease to have effect on the expiration of 6 months following the date on which it was made. 9. It will be seen from the above references to the provisions relating to appellate authorities under the Income‑tax Ordinance that while the power to grant stay is unlimited in so far as the executive authority is concerned, the tax must be paid to invoke the powers of the first appellate authority, with no power to grant stay and even the Tribunal, as the final appellate authority has a maximum power to grant stay of 3 months only, it being well known that the case cannot be finalised within the short time limit of 3 months. Such power has no more than an eye wash in effect, it is unreal and illusory and contrary to the trite and oft‑repeated concept that a Court which can and has power to pass a final judgment has the inherent power to pass all interim and interlocutory orders. The provisions are an unnatural thrust on reason and jurisprudential basis of the Courts. 10. The recount of the above provisions from the Income‑tax Ordi nance would tend one to query whether or not there is some degree of diffidence or a lack of reliance of a Legislature in the tax appellate authorities, and not in others, or is it a conviction that these appellate authorities do not appreciate and their orders deemed a spoke in the wheel of revenue collection 2 Such thinking also betrays tae hustle for recovery of the demands issued under assessments, even if their legality is not proper and lawfully questioned. It is, perhaps, recognized that there is need for stay to be granted but that such power should be exercised merely by the executive authorities: The executive authorities would seem to have greater confidence of the Legislature in these matters as compared to the appellate authorities who enjoy superior jurisdiction to pass a final order which would change, upset or set aside the executive order and is thus to be given effect. This only creates a paradox. The legislations entrust the appellate authority with power to pass a final order but do not trust it with an interim. There would thus be a very strong legal objection. 'The authority having jurisdiction to pass final order should, a fortiorari, have power to pleas ail interim orders. That is the accepted basis of jurisdiction of Courts trader civilised procedures of law unless deliberate curbs ore such jurisdiction are intended. Such curbs have, however, been always noted as male fide and ulterior in their charter and approach for when you create a Court, how can you mistrust it? It is the way under martial law regime only. 11. While the citations for illustrations are taken from the Income-tax Ordinance, a part materia situation is to be found in all other, taxing and revenue statutes. The result is, that the powers in the executive become un controlled and unbridled. There is so much arbitrariness, thereby. It has now assumed the proportion of bang wilful and deliberate and the laws, in their hands, have come to assume the meaning and carry effect of their whims and caprices. In particular, those making the assessment know, too well all the pains and suffering which tax‑payers have to so through until the final appellate order (there being no interim relief m the meantime) to be Good enough to annihilate their victim. Where such power is not controlled by the superior appellate authorities, as, in the instant cases, there is a breeding of high corruption the measure of which was given by the ex‑Finance Minister, presently Minister .for Planning, at rupees twenty billion. The contribution to such graft and corruption from the field of taxes may be cut to half, in their respective places, where appeals under the law are heard by appellate forums under the control of the High Courts or Ministry of Law (as the Income‑tax Appellate Tribunal) and such appellate forums are allowed their natural powers recognised by the law with full scope to pass ad interim, interim and interlocutory orders. It may be mentioned that appellate authorities do not allow interim reliefs or pass such orders on whims or caprice or on their arbitrary judgment but on the, well‑settled rules of prima facie case, ex facie legality or illegality, balance of convenience or in the alternative, inconvenience, irreparable harm or injury and equities of the situation. The judicial mind is seen to grasp the facts on these principles to warrant or otherwise refuse the grant of ad interim or interim relief. 12. The income‑tax cases decided by superior Courts are reported in several published reports. The major reports are Income‑tax Reports (I. T. R.) (Indian), (P T D) Pakistan Tax Decisions and Taxation (Tax) (Pakistani). If an exercise is undertaken to assess the result of the cases as in these reports, it would be found that roughly 80% or more cases have been decided in favour of the assessees. These are enough to be a record of the arbitrariness and illegalities committed by the assessing authorities. They go further. They reinforce the submissions made in this article that all the while the assessee, in the absence of interim relief, was subjected to arbitrary and illegal tax demand realised from him. It is time that the Legislature takes a note of this series gap in the law and the resultant injury to those who are victims of vagaries and caprices of graft demanding and arbitrarily assessing authorities charged with lawful realisation and nothing else. The suggestion is that down from sub‑Article (4‑A) of Article 199 of the Constitution to all Appellate Authorities under all the various taxation and revenue laws, the power of interim relief, at its full, must be expressly provided by the law and relevant amendments and changes therein may be brought in the 1986 Budget together with the change in their basis that all appellate forums must be removed from being subordinate to or under the control of the Central Board of Revenue, preferably under the High Courts or the Ministry of Law and from the reference, jurisdiction of the High Courts be also made appellate. The tax‑payer, from his down‑graded position, may then vie with the murderers, the dacoits, the rapists and all others charged with heinous offences, in the matter of 'interim relief. FIGHTING POLLUTION IN CHINA By DR. PARVEZ HASSAN, LL. B. (Pb.), LL. M. (Yale), S. J. D. (Harvard) Advocate, Lahore High Court and Supreme Court of Pakistan The world Environment Day was observed with unusual fervour all over the world this year on 5th June. Mr. Tolba, the Executive Director of the United Nations Environment Program, had given a call to world leaders to highlight their support for a clean and healthy environment for the globe by planting "Trees of Peace". This way they would emphasize the increa singly acknowledged inter‑relationship between a healthy environmental eco‑system management and world peace. The People's Republic of China was one of the many countries that responded to this call. Vice‑Premier Li Peng, Mr. Ye Rutang, Minister of Urban and Rural Reconstruction and Environmental Protection, Madam Kang Ke Qing, Vice‑Chairman, Standing Committee, National People's Congress (widow of the C‑in‑C of the People's Liberation Army, Zhu De who, with Chairman Mao Tse‑Tung, led the Cdmmunist Revolution in 1949), and several other top leaders of China assembled to plant a Tree of Peace in Beijing on 5th June. Invited to this ceremony were representatives from the Untied Nations, UNEP and an ESCAP Environmental Mission. The ESCAP Mission comprised of five environmentalists drawn from the Asian and Pacific Region. It was led by Dr. Kazi F. Jalal Bangladesh), who ably heads the Environment Department of ESCAP, Mr. Philip Mathews, Chairman of the Malaysian Forum of Environmental Journalists, Mr. Surin Setamanit, Director of the Institute of Environment Research of Chulalongkorn University in Bangkok, Thailand, Mr. Chatichal Sarkar, a renowned journalist of India who is the Chairman of the Asian Forum of Environmental Journalists, and the writers. Following the World Environmental Day ceremonies in Beijing, the Government of China made elaborate arrangements for the visits, as state guests, of the ESCAP Mission to various parts of China. Accompanied throughout by our host Ministry officials and interpreters, we saw first hand the great effort that China has made in meeting the legion pollution, pro blems that followed in the wake of its relentless efforts to industrialize since 1949. What follows is tree writer's assessment of the Chinese experience in environmental protection as reviewed during the two weeks visit to Beijing; Loyang, Xian, Shanghai and Guangzhou (Canton). The visit involved extensive interviews with officials of the Chinese National Environ mental Protection Agency, the Environmental Protection Bureaus of the four major provinces visited, and Directors and workers of major industrial plants in the cities visited by us. As the editor of the China Environment News, the country's widely read environmental paper, also accompanied the ESCAP Mission throughout its visit, it was possible to exchange views with him during field trips There are several lessor for a developing country like Pakistan in the experience of China [For Pakistan's quest for environmental quality, see, generally, Dr. Pervez Hassan, Pakistan's Environment Ordinance: Background and Prospects, Dawn, 29th January, 1984. Pakistan's continuing inaction follow ing the promulgation of this Ordinance has been reviewed in, Dr. Parvez Hassan, Disappearing Act, Herald, at 75‑78 (March 1986). See also Dr. Pervez Hassan, Pollution Ordinance it Needs to be made Public, Pakistan Times. 6th June, 1982, Dr. Parvez Hussan, War Against Pollution. The Pakistan Times, 7th June, 1980.]. This great neighbouring country has found that it is having to pay a very heavy price for its massive surge to modernization through industrialization. Some what neglected in the process was the need to control the environmental hazards unleashed by industrialization. Its rivers were want only pollutes: traditional sources of drinking water and fish life disappeared in many area. Mercury, chemical wastes and other wastes discharged by factories entered rivers and through them the food chain of its citizens. The air in some cities became so contaminated by industrial effluents that it threatened the health and life of its people. The country woke to the seriousness of this problem only in recent years. It appears that, like in other countries, the United Nations Conference on Human Environment which was convened in Stockholm in 1972, was the catalytic event that induced environmental concert: in China. And what China has accomplished since this realization is a. remarkable study of what a resolute determination of a nation can achieve. Industrial development without environmental considerations can play havoc with the quality of life in any society. The United States, for example, initially ignored the integration of environmental considerations in its science and planning. The result was that while the population of the U. S. only increased by 30% during 1950‑70, the increase of sulphur dioxide in the air went up by 600%, the increase of DDT in water by 1800% .during the same period. The content of other harmful chemicals went up by the same percentages. It is the realization of such degradation of its environment that has induced a spirited environmental protection regime in the U. S. A. Experience in countries‑--Both developed and developing has shown that effective environmental management of their resources depends on the following principal factors [See, generally, Dr. Parvez Hassan, Status Report on Environmental Protection Legislation in the ESCAP Region (ESCAP, 1878).]. (a) political will (b) institutional arrangements (c) appropriate legislation (d) public awareness, and (e) availability of the requisite financial/technological/manpower resources. The starting point of all environmental effort is mostly the realization at the level of the State that unless its resource utilization is managed on environmentally sound basis, irreparable harm will result in the quality of life of its future citizenry This realization is, generally, followed by the Government innovation or upgrading its envirnnmental concerns by the creation of Departments, Ministries, Bureaus or Agencies specifically oriented to environmental protection. First, a general environmental statute against pollution and then specific legislation in important areas such as water, air, marine and noise pollution follow prescribing, in each case, a nationally‑binding environmental list of do's and don'ts. The success of the implementation of this environmental code depends to a considerable extent on the effective education the citizanary‑at all levels has received towards understanding and protecting its vital environmental rights. And, finally, the financial and managerial resources available or allocated by the State determine whether environmental concerns can be translated into remedial measures through what can sometimes be very expensive treatment plants and waste disposal technology. It is a major finding of the ESCAP Environmental Mission that China's record of environmental policies is a most impressive one. This country has demonstrated that it has the "political will" to deal with environmental problems that are increasingly plaguing its onward march to industrializa tion and modernization. Equally salutary is China's evolution of a well‑integrated environmental protection institutional framework that virtually spans the whole country. The country has further moved, learning from relevant experiences in other countries, to the field of legislation and has "contemporary" and comprehensive laws such as on marine and water pollution and is in the process of finalizing its law on air pollution. The public awareness on environmental issues being aroused in China is perhaps the country's greatest achievement and one which is destined to serve it best' in the long run. It is remarkable that so much has been done in this field in so little time since the Stockholm Conference in 1972. So, while China has all the ingredients of the first four prerequisites of environmental protection noted earlier, it is in the fifth field that of the requisite financial, technological and manpower resources that it lags behind. Here, all the constraints of a developing society are felt‑although not in the same degree as some of the less privileged nations in the region‑but China's resolute. political will to maintain a sound ecological balance is likely to overcome this hardship. The following discussion is a back‑drop to these general conclusions A POLITICAL WILL Although it was abundantly noted by our hosts that China is a deve loping Third World country that needs to meet the increasing needs of its massive population of over one billion by rapid development including thorough industrialization, it was equally frequently acknowledged that the protection of its environment has now become a major objective in all Government planning at all levels [On similar perceptions in other countries in the region, See, generally, Dr. Parvez Hassan, Environment and National Planning. The Pakistan Times, 17th November, 1978, and Environmental Protection in the ESCAP Region. The Pakistan Times, 19th May, 1978.]. In his opening remarks at the meeting commemorating the World Environment Day in Beijing on 5th June, 1986, Mr. Ye Rutang, the Chinese Minister of Urban and Rural Construction and Environmental Protection informed the ESCAP Mission that environ mental protection had been given top priority in the country's 7th Five Year Plan. The Minister identified the following ten environmental problems threatening China: (1) ever worsening desertification, (2) serious deforestation, (3) extinction of wildlife, (4) rapid growth of population adding greater stress to the environment, (5) decreasing of drinking water sources, (6) indiscriminate catching resulting in the destruction of fish resources, (7) utilization of large amount of pesticides impairing crops and human health; (8) rising of the temperature on the earth (9) development of acid rain. He added: "If we do not pay adequate attention to these problems, we will be punished not only at present, but our future development will be hindered and irreversible losses will result. As a matter of fact, environmental pollution and ecological destruction are fairly serious in our country. And in some areas and in certain aspects, the situation is even worsening. This has become a big contradiction in our modernization". Subsequent meetings with officials of the National Environmental Protection Agency and of the Environment Protection Bureaus in Loyang, Xian, Shanghai and Guangzhou amply highlighted this all pervasive national/provincial state commitment. This political will has, seemingly, percolated down to the industrial units‑or at least the ones that we visited. In fact, we noticed so much attention to environmental protection in the statements of public leaders, in the media, on the billboards, and on the TV that it seems to have, happily, occupied centre stage at least in China's urban centres. All this is a reflection of the country's will to stem the rot of environmental degradation that was being brought about in its hasty drive to establish and sustain a strong industrial base in New China. The resultant pollution of its rivers and related environmental problems all woke the country to the irretrievable damage that was being done to the quality of the life of its peoples. From this timely realization has emerged an amazingly resolute will to undo the damage. This argues well for the people of China. B. INSTITUTIONAL ARRANGEMENTS While China's environmental concerns, generally, are post‑Stockholm 1972 and, therefore, recent, it has in a short time established a rather impressive institutional network of environmental protection agencies all over the country. This, again, will well serve its efforts. An Environmental Protection Commission under the State Council has been established in 1984. Chaired by Vice‑Premier, Li Peng, the Commission meets once a quarter, making major policy decisions on environmental issues. The National Environmental Protection Agency (NEPA) under the Ministry of Urban and Rural Construction and Environmental Protection is the country's permanent secretariat mandated with the task of promoting and protecting China's environment. It appears that this body sets national guidelines and is thus the pace‑setter of all environmental efforts in the country. NEPA seemingly enjoys considerable autonomy and can evolve and develop national environmental standards. National legislations such as on marine and water pollution were en couraged by NEPA. The Ministry of Urban and Rural Construction and Environmental Protection, as the name itself would indicate, has integrated environmental protection in the national development process. This is a model that other countries in the region would do well to emulate. By combining major development sector(s) with environmental protection in the same Ministry, the traditional conflict between construction/development depart ments and environmental protection departments has been avoided. But it is the remarkable synthesis that has been achieved between federal and provincial environmental efforts that deserves particular commendation. In many countries in the region, the lines drawn between national and provincial competence in environmental subjects ("federal" or "state" subjects) in their Constitutions are not that clear and this has resulted in some confusion and friction between the Federal Government and the provinces/states. There is no such ambiguity in China and the policy announced or developed by the Environmental Protection Commis sion or NEPA seems to be fully supported by the Provinces. We were also impressed by the supportive role of the Provinces. None of the officials of the Provinces visited raised any questions about the relevance or appropriateness of the policy or laws announced at the national level from time to time. Considering the great size of China and the diversity of its regional problems, this was found most remarkable. It reflects the team spirit that has developed amongst the environmental managers all over the country. Each Province visited by us was found to have fairly large Environ mental Protection Bureaus generally headed by a Director. The Bureaus seemed well‑staffed and comprising various disciplines appropriate to environmental protection. We were impressed by the motivation of the staff. It was also observed that each Bureau had laboratories, research facilities, monitoring stations (stationary and mobile). These observations apply equally to the Environmental Protection bureaus of the various cities visited by the Mission. In fact, it was noted that the Environment Protection Bureaus of some of the cities in China were larger and better equipped than the national Environmental Protection Agencies of some countries in the region. A rather unique feature of the Environment Protection Bureaus of the cities visited‑and it is believed that this is the general pattern through out China is their "integration" with the Mayors office in that city. By involving the Mayor's office in all environmental decisions, the city Bureaus ensure their co‑ordination with the overall decision‑making process of that city and by doing so ensure their compliance. The on going interaction between the two offices seemed mutually beneficial. The Mayor's office in consulting the Environmental Bureau on its decisions, ensures that such decisions would be environmentally sustain able. The Environment Bureau, in consulting the Mayor's office before presenting environmental standards, ensures that such standards would be implemented. An example of how the Mayor and the Environment Bureau work in unison was observed in Luyang The city Environment Bureau, reacting to complaints about loud music noise from certain sources, reviewed this problem with the Mayor's office and, in consultation with him, pro hibited the playing of music on loudspeakers. With such support, the implementation of this regulation would be easier as the Mayor s office, unlike the environmental Bureau, would have the ability to enforce the regulation. Conversely, the Vice‑Mayor of Loyang outlined his future plans for the city of Loyang. These plans with their environmental thrust could well be the plans formulated by the Environmental Protection Bureau of any city. For Loyang, the future hope, he said, is in the (i) development of its water quality. (ii) the development of central heating through a thermal power plant which will reduce/minimize existing coal‑powered pollution and (iii) the use of liquefied coal gas for domestic purposes. The Vice‑Mayor was seeking US $ 500 million for these objectives which would serve both development and environmental protection efforts. It is perhaps a routine phenomenon for the Mayors of cities to plan the development of their cities but what we found somewhat unusual in China was the integration of environmental considerations in such planning by city developers. This is the result of the patterned inter‑relationship between the Mayors and the Environmental Protection Bureaus of the same city. China's institutional network of environmental protection even goes be low the city level. The various 'industrial units visited all had environmental protection bureaus within the factories. The integration of these factory bureaus with city administration is accomplished by the representation of the Party Secretary in each factory. The Party Secretary‑a member of the Communist Party‑shares leadership of the factory with the Director of the factory. As he is responsible for areas impacting on the welfare of the workers, he can translate the environmental policy of the Party at the level of his factory. This remarkable ability of the ruling Party to reach environmental protection at the grass‑root level may prove to be the greatest strength of the environmental protection effort in China. C. CONSTITUTION AND LEGISLATION [ The roll of legislation in environmental management has been reviewed in Dr. Parvez Hassan, Legislation as a Tool for Environmental Management P L D 1983 Jour, 126‑33; Pakistan Economist, 17th‑23rd, October, 1981 at 22‑26; also in the Pakistan Times, 6th October, 1981; View point, 1st October, 1991 at 21‑22 & 32 ; The Management, November, December 1981 at 7‑12.] Although China's environmental awakening is about a decade old, it has already an impressive array of comprehensive and, more recently, specialized legislation in areas of environmental concern, all flowing from its recognition of the importance of environmental protection in its Constitution. 1. Constitution. Article 11 of the Constitution of the People's Republic of China (1978) stipulates: "The state protects the environment and natural resources and prevents and eliminates pollution and other hazards to the public". There are more and even clearer stipulations on the environmental policy in the new Constitution of 1982, as in Articles 9, 10, 22 and 26. For instance, Article 't6 stipulates: "The state protects and improves living environment and ecological environment and prevents and eliminates pollution and other hazards to the public." Article 9 stipulates that "the mineral resources, waters, forests, mountains, grasslands, wastelands, beaches and other natural resources are the property of the state, as the property of the whole people . . . . ". The provisions in the Chinese Constitution declaring that its natural resources are the property of the whole people are somewhat unusual. Very few other Constitutions‑such as that of Papua New Guinea----- acknowledge this concept of the use of natural resources in trust for future generations. But such a concept of user in trust is essential in optimal resource management. Fortunately, China, at the highest level of its Constitution, has in a way accepted the basic environmental philosophy that the global natural resources have not been given to us by our parents but loaned to us by our children. , 2. Environmental Protection Law, 1979 This Basic Law was adopted in principle by the Standing Committee of the Fifth National People's Congress in 1979. It was the first Environ mental Code for the nation and has general provisions such as on Protec tion of the natural environment, prevention of' pollution and other hazards to the public and the setting up of the Environmental Protection office. 3. Forest Laws The forests in China [For an overview of forestry matters in the Asian and Pacific Region, see, generally, Dr. Parvez Hassan, Institutional and Legislative Framework for Forestry Management in the Escap Region (ESCAP, 1985).] occupy approximately 12 per cent of the total area; tropical forests occupy only 2 per cent of the area in the tropical zone. This is a result of the extensive deforestation brought about by the economic demands for timber, firewood and other forest resources. There is a growing realization of the importance of forests. This is amply reflected in the priority given to this field in the Constitution, laws, policies nod institutions of China. The Forest Law of the People's Republic of China has been operating on a trial basis since 1979, and this Law was passed by the seventh session of the Standing Committee of the Sixth National People's Congress in September 1984, and entered into force as of 1st January, 1985. It lays s legal foundation for forestry development. There are indications that the Forest Law seeks to reverse the earlier trend of deforestation in China. Conservation‑oriented management rather than merely complying with timber production targets seems to be the new philosophy. This national legislated objective is effectively supported by governmental regulations highlighting the importance of trees and forests. 4. Marine Environment Protection Law This was adopted at the 29th Session of the Standing Committee of the Fifth National People's Congress of 23rd August, 1982 and became effective on 1st March, 1983. This is a "contemporary" legislation in every sense. It is comp rehensive and identifies and provides against marine pollution from the following main sources: (i) coastal construction projects, (ii) offshore oil exploration/exploitation, (iii) land‑based pollution, (iv) vessels, and (v) dumping of wastes. It establishes legal liabilities and entitles an individual who has suffered damage to claim compensation from the polluter. Oil Tankers of 150 tons and other vessels of 400 tons are required to be fitted with anti‑pollution equipment. Vessels of lesser tonnage are to have special containers for recovering residual and waste oils. Oil tankers of 150 tons and other vessels of 400 tons are to have a Certificate of Insurance for Civil Liability for oil Pollution Damage. These provisions, if properly implemented, can ensure a healthier marine pollution for China. Although we did not visit any site to assess marine pollution, a cruise on the Huang Pu River in Shanghai near the East China Sea showed laxity in the implementation of these legislated goals. As much as 200;000 tons of industrial effluents and domestic wastes are emptied daily in the Huang Pu River by the chemical, paper/pulp, and textile factories that proliferate around Shanghai with a population of over 13 million. The impact is lethal, there has been no fish life in the River for the last 25 years and the River ‑‑ almost black and emitting a foul stench‑is a pathetic sight. And. this is the state of a River that provides solely the 4.3 million tons of water for industrial (80%) and domestic (20%,) requirements for the environs of Shanghai. Unfortunately, groundwater utilization has been abandoned because of land subsidence‑a problem also faced by Bangkok in Thailand which is sinking gradually. It is a major challenge before the Shanghai Environmental Protection Bureau to clean the Huang Pu River and it is confident that because of its remedial measures, it will attain water quality grade 3 level by 1990 and grade 2 by 2,000 with some upper reaches of the River even attaining grade 1 by them. 5. Water Pollution Protection and Control Law This law became effective on 1st November, 1984, having been adopted at the fifth session of the Standing Committee of the Sixth National People's Congress. Like the Marine Pollution Law, this too is a "contemporary" statute. It has likely consolidated the prior fragmented regulations in this area. This is the most. important environmental legislation in China as the bulk of the pollution in China appears to be related to the discharge of wastes and industrial effluents in the public waters of the country. Chapter II of this law establishes environmental quality standards and pollution discharge standards. Chapter III. deals with supervision and administration of water pollution, prevention and control. Chapter 1V prohibits surface water pollution and underground water pollution is forbidden in Chapter V. In Chapter III, Articles 13‑15 deal with the requirement of a prior Environment Impact Assessment of any project that is likely to discharge any pollutants, of projects needing to report their discharges and paying discharge fees therefore. We found that the requirement of the payment of discharge fees is acting as a credible deterrent to water pollution. Industries, to improve their profitability and, resultantly, the share or bonuses to the workers, strive to avoid the payment of discharge fees. As a vested right is created in the workers, they participate as important partners in this environmental effort. We were informed to Loyang, Xian and Shanghai that a carrot and stick policy is held out around the Discharge Fees. Existing industries are given a specific period to eliminate pollutant discharges (usually three years). If they succeed, a substantial portion--‑some times as much as 80% of the Discharge Fee paid in the past is refunded for use in the Fund drat is ultimately used for the workers and the welfare. If the industry does not succeed to achieve the stipulated environmental target, the Discharge Fee can be doubled after three years or, if so decided by the Environmental Protection Bureau. the industrial unit could be ordered to be closed. The Discharge Fees is an important aspect of China's environmental protection effort. It is believed that the National Environmental Protection Agency has a separate Division dealing with Discharge Fees. At the Shanghai Tianyuan Chemical Works, we found that this factory had paid 0.8 Million Yuan for Discharge Fee in the preceding year. It was spending another about 40 Million Yuan every year on its pollution control efforts. This represented over 2 y. of the total annual sales of the Factory of 180 million Yuan. If this percentage is typical of the other factories in China, it would mean that the country is making a credible effort in pollution control. Water pollution represents a major challenge to China's planners. Let us look at some random statistics (i) the Loyang Ball Bearing Factory (annual production 27 million ball bearings) discharges 3.45 million tons of water effluents each year; (ii) the Loyang No. 1 Tractor Plant (annual production 15,000 tractors 75 H. P. plus other items) discharges 4 to 5 million tons of waste water. (iii) 200,000 tons of industrial and domestic wastes are being dis charged daily in the Huang Pu River in Shanghai. The waste waters discharged from such and other industries contain harmful chemicals such a chlorine, hydrochloric acid, chloride foam and mercury. If allowed to be discharged untreated in the rivers, such wastes kill or harm fish life, destroy the use of the water as drinking water and when used for irrigation purposes, enter the food chain through con taminated vegetables and crops. The Water Pollution Law seeks to meet this crisis. It is felt that the Water Pollution Law, 1984 represents appropriate legislative goals and that if its provisions are effectively implemented, the trend in the increase of cite pollution of Chinese rivers and lakes could be reversed. In addition to the provisions on Discharge Fees, this Law has provisions that, among others, prescribe that‑ (i) no new project shall discharge wastes within certain protected zones, .around domestic/drinking sources or famous and scenic water spots; (ii) there shall be no discharge of oils acids and high tonic liquid wastes; (iii) vehicle containers used to store oil or toxic pollutants shall not be cleaned in public waters; (iv) discharge of industrial wastes, municipal garbage or other wastes shall be regulated; (v) prohibit the discharge of radio, active wastes. At Loyang, Man and Shanghai all urban centres‑there was much sensitivity to water pollution and the need to control it. Indeed, measures are being taken in all the factories visited by us in this field. It was gathered that the strategy of the Government is as follows: (1) no new project is to be allowed that does not include an in built and appropriate pollution abatement equipments; (2) existing projects are induced to take corrective measures over a period of time through the carrot and stick policy of the Discharge Fees. The urban centres may, therefore, have taken a beginning towards controlling water pollution. But what seemed disturbing was the massive industrialization taking place in the rural areas where pollution control measures were not being applied. In fact, it was explained that the impetus to rural industrialization lay in several factors of which the most important was the "stringent" pollution control measures in the urban areas. Rural industries were, therefore, born in the ethos of freedom from environmental regulation. But they have proliferated. And proliferated to numbers whose aggregate presents a monstrous dimension. Together, they represent, in our view, the greatest threat to China's environmental efforts. 6. Air Pollution Law We were informed that a comprehensive law on air pollution had been drafted and that it would likely be approved by 1987. If this legislation is as comprehensive as the 1982 Marine Pollution Law and the 1984 Water Pollution Law, it would provide an important source of relief to the atmospheric pollution that has already assumed crisis proportion in some urban centres. In Loyang, it was obvious that the massive industrial belt that envelopes it had polluted the air. The city is covered with a blanket of dust particles. But, the atmosphere having more absorption capacity than public waters, the air seems less threatened than the waters of China. A major national objective is lessening air pollution is popularizing coal gas instead of coal and in introducing central heating instead of use of stoves and boilers in domestic use. It is planned that 80% of the cities will be using central heating by 1990 thus reducing pollution by rampant coal burning. However, the challenge would lie in the appropriate implementation of this law when it is approved. 7. Noise Pollution Although there is no specific national legislation in this regard, noise pollution is effectively taken care of in China at the level of city regulations. Construction machinery, vehicles, trains, factories, loudspeakers, and airports are some of the sources that contribute to unbearable noise levels in many urban centres around the globe. A noise level be; and 80 decibels can impact adversely on human health and it should be the endeavour of every society to reduce noise so that people can have a tranquil work and rest environment. This is accomplished by prohibiting or regulating the use of construction machinery, honking, loudspeakers or the use of trains and airports after certain hours. Strict controls bar the use of vehicles without silencers and noise abatement equipment is required in factories. Chinese cities ensure noise abatement through a series of administrative regulations. The people are reminded of its importance by the placing of noise metres on main roads such as the ones we saw in Loyang and Shanghai. What the noise level is at that busy part of the city is continuously shown‑day and night by these metres. In both these cities, we saw the metres recording noise levels of between 67 70 decibels which is a satisfactory level. From this, it is clear that noise pollution is not that serious a problem for Chinese cities and that by involving the people through noise metres at public places, it is likely that this problem will not be allowed to get out of hand as happened in many western cities. , D. PUBLIC AWARENESS One of the most impressive achievements noticed in China was the success in creating a mass public awareness of environmental issues. This has been a very committed and deliberate policy of the Government which was found has been very successful in the manner of its implementa tion. No Government can expect a meaningful implementation of its laws or regulatory regime unless it has created an understanding about their objectives among its citizens. For, in the final analysis, it is the people who are the best watchdog of their rights. A telling example of the impact of the public awareness of environmental issues can be cited by the reticent attempt to open a tantalum plant in Phuket, Thailand. This project was feared to release industrial wastes including toxic chemical which would play havoc with the city's resort image. As many as 50,000 persons (enough to fill the Mochi Gate at Lahore) took out a procession against the plant on Ist June, 1986 and the result was that the Government of Thailand had to announce the following day that it is satisfied that there would be no environmental damage. This response was apparently not found satisfactory and the result was that thousands of angry residents of the resort city surrounded the refinery and set it ablaze in the last week of June, 1986. China has accomplished its effective public education on environmental issues by frequent speeches from the top party leadership, by daily stories on environmental issues in the Press, television and radio and also in the implementation of the party directives at the level of provinces, cities and industrial projects. We were informed that there are regular daily broadcasts on China's Radio stations extolling the virtues of sound environmental management and criticising decisions that have adversely affected the environment of a city or an area. Similarly, the television network routinely brings into every Chinese home, with immense visual impact the devastation that unchecked industrial pollution is bringing to human and wide life. Efforts by the municipality to rectify these mistakes are given top billing on news presentations routinely. The newspapers are also heavily oriented towards environmental protection. The widely read Peoples Daily with a circulation of over four million has regular stories on environmental matters. As 70% of China's population is below 35, the Chinese have also correctly realised that the most receptive group for seeking environmental quality is the youth of China. The China Youth Daily with a circulation of over two million, therefore, covers environment issues in almost every issue. Its target group is ages 14‑28 and it patterns its stories around matters of interest to youth such as wildlife and birds to convey environment themes. The China Environmental News, a bi‑weekly with a circulation of over half a million is devoted entirely W environmental problems being faced in China. During our visits to various industrial centres, we found that the China Environmental News was widely read in these factories. In fact, we found that each large factory had its own environmental newspaper which was widely read among its workers. Other newspapers of China such as the Guangming Daily, the Economic Daily, Workers Daily and Science and Technology all have regular features and stories on the environment in China. The result of the above efforts has been that environmental concerns have been taken into every home in China. E. FINANCIAL/TECHNOLOGICAL/MANPOWER RESOURCES While China clearly has the political will to fight pollution, we found that the only constraint in its commitment is the scarcity of its financial/ technological/manpower resources. This is not to say that China does not have such resources at all. Instead it points to the gigantic dimension of the problem introduced by a policy of indiscriminate and unplanned industrialization which requires an equally titanic response. Here. the future development needs of China clearly clash with its environmental priorities. The environmental signals, however, are clear: it seems to be a firm decision of the Government that no new projects shall be allowed initially in China unless each of them has self‑corrective pollution safeguards. But it is the old plants that haunt Chinas ecological scene. These are presently being dealt with through a policy of carrot and stick represented by the system of discharge fees. However, it is unlikely that the Chinese Government will strictly follow the option of closing down factories that do not find methods to treat their industrial wastes before discharge. In same cases, the economic needs of the country to continue producing perhaps may outweigh environmental considerations. Already, there has been a gravitation to the rural areas of industrial project mostly to avoid the strict pollution standards of industries in the urban centres. In the province of Shaanxi, for example, as many as 500,000 rural industries have been established. These industries varied from one that required ten workers to operate them to others that may require as many as 300 workers. These industries, with less stringent pollution control standards, resultantly, pose the greatest threat to China's environmental future. Most pollutant industrial projects are anxious to find solutions to their harmful waste discharges. But several indicate that technology has not so far developed to assist such objectives. For example, it was pointed out in Loyang that the textile industries have not been able to treat the colours of dyes in the manufacturing process. The above handicaps notwithstanding, China is committing as much of its financial/techno logical/manpower resources to solve its environmental problems as is possible in the context of its overall goals for economic development. This great country undertook 100,000 industrial pollution control projects in its sixth Five‑Year Plan period (1979‑84) considerably reducing thereby the amount of pollutant discharges. The Chinese are proud that during this period the annual increase of gross output value of their industry increased by 10.6 % and gross output value of industry increased by 65 % in 1985 as compared with 1980, but the amount of industrial discharge of waste water, waste gas and solid waste did not increase. On the contrary, it decreased. This is a tremendous progress. Other achievements include the construction of numerous sewage treatment plants of developing technology to substantially eliminate smoke and dust in use of coal gas, and of reducing noise levels by 2 to 7 decibels in major cities. All of this is reviewed by monitoring stations which have been established in more than 800 countries. There are all together over 1,100 environment‑monitoring stations in China, an increase of 76% since 1981. Appropriate emphasis is also being laid on environmental research and there are as many as 7,000 persons in China today who are engaged in research in this field. Because of these measures, Edgar Snow's famous Red Star over China is not likely to fade by the pollution hazards of the future. F. LESSONS FOR PAKISTAN The Chinese experience has shown what has also been witnessed in other developed and developing countries: that indiscriminate developing industrialization can result in high environmental cost involving a permanent damage to the natural resource base of a nation. The lesson to be learnt is that Pakistan must give immediate attention to the need to reorient its development around ecological considerations. Inaction and apathy point to the heavy price that we are already paying (1) industrial units all over Pakistan are wantonly discharging their wastes in public waters such as canals and rivers or even on land. There is to date no requirement of treatment of such wastes before discharge. The result is that harmful chemicals have polluted out rivers‑which are important sources of drinking water and irrigation. When discharged on land industrial wastes permanently damage the soil (2) the pollution from industrial sources, particularly Industrial Estates such as in Karachi and Kala Shah Kaku and on the Lahore‑Sheikhupura Road, has already reached crisis pro portions. (3) the use of polluted water for irrigation purposes is most dange rous for human health because chemicals enter the food chain through vegetables and crops that have grown with the use of such water or were washed in it before being sent to the Mandis. (4) the uncontrolled discharge of untreated domestic and industrial wastes in the coastal waters is destroying fish and aquatic life around Karachi. Our newspapers are already replete with stories of dead and contaminated fish, crabs, shrimp and turtles being found in the marine belt. The Lyari River which carries 70% of all industrial effluents of Karachi is a free for all; it takes every thing from chemicals and pesticides to organic wastes of all kinds before emptying them into the Manora Channel. PCSIR studies have established high‑and harmful lead, chromium and bicarbonate levels in these discharges. Indications point to increasing deterioration in the future. (5) our forests have been denuded to a point where less than 4% of our country is now under forest cover. This deforestation is already having an adverse ecological effect including rising soil erosion and climatic changes. (6) dwindling forests and indiscriminate hunting threaten our wildlife heritage : the houbara bustard, marco polo, urial, the snow leopard and the Indus dolpbin are only some of our threatened wildlife species. (7) the discharge of carbon monoxide and other pollutants by vehicular traffic and other sources in Karachi is threatening not only the health of the residents of Karachi but also the beauty of the Quaid's mausoleum. (8) pollution is gradually reducing the nation's recreational spots. (9) unplanned urban development has allowed the growth of noisy and foul‑smell emitting factories in residential areas causing much harm to the quality of life. The above represents merely the tip of the ice‑berg. So, common place are environmental hazards that our newspapers are increasingly covering citizens complaints. But our Government remains unmoved and is almost totally insensitive to this degradation. The Bhutto Government had pioneered action in the field by proposing a comprehensive Environmental Protection Ordinance for Pakistan. The proposed Ordinance became a casualty in the event of 1977. A somewhat less ambitious Ordinance" was, however, promulgated in the last days of 1983 but no action has been taken to date to implement it. Even the National Environmental Protection Agency provided in the Ordinance has not been established pointing to a total lack of political will in the present Government in environmental matters. This is & sad state of affairs and one which our children and grandchildren may find difficult to forgive us for. Let us learn from the Chinese experience before it is too late. Let us develop the political will, institutions, legislation and public awareness which will best guarantee that our future decisions and actions are geared to protecting the environment. Environmental awareness can be created through the media as has been most effectively done in China. The, creation of a national forum of environmental journalists as has been done in many countries of the region in Pakistan will particularly help this effort. Environmental themes should be introduced in the syllabi at schools so that we create a future constituency for a sound ecological management. And only through a dedicated national commitment and resolve will we save our environment for our future generations,