1983 PLP 571 (CLC)

Assistant Advocate-General (on 3-4-1978) and Advocate-General (on 27-4-1978) for Respondents. Dates of hearing : 3rd and 27th April, 1978. ABDUL HAYEE KURESHI, ACrG. C. J.-This petition under Article 199 of the Constitution of Pakistan read with Laws (Continuance in Force) Order, 1970 has been filed by Dada Steel :fills to challenge notifica tion issued by the Revenue Department of the Government of Baluchistan on 21st October, 1975, whereby the ground rent/royalty payable by the petitioner on account of Ship Breaking Industry was enhanced as from 1st April, 1975. The petitioner has also claimed the consequent relief for refund of the amount paid by him under protest. Mr. S. M. Sadiq, Advocate has represented the petitioner before us and the respondents namely, the Government of Baluchistan and the Provincial Board of Revenue were represented before us by the Assistant Advocate-General and the Advocate-General.

2. Tae brief facts are that the petitioner deals in purchase of old ships for breaking and re-rolling steel scrap. Such industry is carried on at Gadani Beach in Hub Tehsil of Lasbela District. In December, 1972 the respondent Board of Revenue allotted a plot of 4 acres bearing No. 29 and again in May, 1975, the same respondent was allot ted another plot of 4 acres bearing No. 30 to the petitioner. The first allotment provided for payment of Rs. 5 per ton on net tonnage of vessel to the Government for breaking and the same allotment order also provides for payment of ground rent at the rate of Rs. 1 per sq. yd. per annum. The second allotment order makes reference to notification No. 11/41/71/Rev/7674-76, dated 31st July, 1974 laying down terms and conditions for the allotment but even such notification provides for payment on the same terms as the first allotment order. It is common ground that these plots beating Nos. 29 and 30 are pieces from khasra Nos. 351 and 357 in Village Mawali Shamali of 'Tehsil Hub. Several amounts were paid by the petitioner to the respondent Board of Revenue in terms of the allotment orders. On 21st October, 1975 the Government of Baluchistan in its Revenue Department issued Notification No. 85-41/75/Rev/12046, whereby the earlier notification dated 31st July, 1974 (referred to above) was modified in exercise of powers conferred by Clause (b) of section 70 of the West Pakistan Land Revenue Act, 1967. By the notification the ground rent which by an earlier notification had been fixed at the rate of Rs. 5 per ton of the dead weight of the vessel was enhanced to Rs. 15 per ton. The notification was made to take effect retrospectively from 1st July, 1975. On 20th January, 1976, the Naib-Tehsildar at Gadani demanded additional tonnage charges under threat of forbidding the conveyance of scrap of the ship from Gadani Beach to Karachi. On 31st July, 1976 the petitioner paid an amount of Rs. 1,33,732 under protest. The petitioner seeks to challenge the validity and vires of the notification whereby the tonnage charges were increased.

3. Before stating the case of respondent it is necessary to say that one Wadera Khuda Bakhsh had made an application to the Board of Revenue claiming that the Khasras out of which land had been allotted to the petitioner were his private property. On 29th April, 1975 the Member, Board of Revenue passed an order declaring Wadera Khuda Bakhsh, and Mehrab as owners of the land which was the subject-matter of allotment made by the Board of Revenue in favour of the petitioner. This order however states that the Government of Baluchistan had introduced a scheme for allotment of plots of 4 acres to the Ship Breaking Companies and had levied a charges of Rs. 00.40 per sq. yd. per annum as ground rent. To such extent the order states that the ground rent at the rate of Rs. 00.40 per sq. ft. was recoverable by the owners direct from the Ship Breaking Companies. The order further states that copies of such allotment orders should in future be sent to Wadera Khuda Bakhsh presumably to facilitate the recovery of ground rent. A copy of this order of the Board of Revenue was forwarded to the Petitioner who had thereafter entered into an agreement of lease directly with Khuda Bakhsh the owner of the plot and a sum exceeding Rs. 25,000 was paid by the petitioner to Wadera Khuda Bakhsh as ground rent.

4. The respondent Board of Revenue has filed parawise comments in which it has been admitted that tonnage charges have been recovered at the rate of Rs. 15 per ton. It is further stated that the tonnage rate was increased from 5 to Rs. 15 in pursuance of the minutes of a meeting of the Provincial Cabinet held in May, 1975. They have relied on West Pakistan Land Revenue (Baluchistan Second Amendment) Ordinance XIV of 197' whereby section 70(1) (b) of the West Pakistan Land Revenue Act, was amended so as to provide for special assessment retrospectively. On the point of title to the land the parawise comment state that the question of title is in dispute pending decision in the Appellate Court of the Commissioner of Kalat. It is submitted in the parawise comments that the Board of Revenue allowed the right to recover the ground rent in lieu of owners Khori rights. However, the same Board of Revenue that had held Waders Khuda Bakhsh as the owner of the land on 24th May, 1975, had stated in parawise comments that there was a dispute in regard to title and the matter had been examined by a Committee appointed by the Martial Law authorities and the title of Khuda Bakhsh was found to be baseless. However, its the same paragraph the comments again state that final decision has not as yet been taken, but there are good grounds to rescind the order of the then Member, Board of Revenue." In regard to levy of Rs, 15 per ton the parawise comments state that the amount was recovered .is tonnage royalty as distinct from rent or revenue. It is stated that this tonnage/royalty has been imposed under the directions of the Provincial Cabinet. The first question that has engaged our attention is in regard to ownership of the land in question. Initially the plots in question were allotted to the petitioner and such ,allotment was not termed as lease. However, when the second plot bearing No. 30 was allotted to the petitioner, the alleament order made reference to the notification dated 21st July, 1974, in which the ailottees were termed as lessees. In a letter from the Board of Revenue to the petitioner dated 17th September, 1975, a sum of Rs. 33,821/40 was demanded as tonnage fee. Again in another letter written by the Board of Revenue to the Commissioner of Kalat Division on 2nd April, 1976, the levy was termed as rent/royalty. In the notification dated 21st October, 1975, which is challenged by this petition the levy has been termed as ground rent royalty. It would thus seem that the amount demanded by the Board of Revenue from the petitioner has been termed as tonnage charge or royalty and sometimes as ground rent but never as assessment. On the other hand the order passed by the Member, Board of Revenue on 29th April, 1975, clearly declared that the land in occupation or use of the petitioner was owned by Wadera Khuda Bakhsh and others and the order further provided that ground rent at the rate of Rs. 00.40 per sq. yd. per annum was payable by the occupant to such owners. All such material on the record shows that the property in question is privately owned and not Government Land. No doubt the parawise comments submitted by the Board of Revenue states that the title was "under dispute, but it is also stated that no final decision in relation to ownership of the land in question has yet been taken. Nothing has been placed before us to show that any enquiry or proceed ings in relation to title to this land are pending before any authority. In such circumstances the conclusion is inescapable that the respondents have no proprietary interest in the land in question. The next question for consideration is in regard to the levy itself. Initially plot No. 29 was allotted and a sum of Rs. 15 per ton of the net tonnage of the vessel was fixed by the Board of Revenue. The allotment order does not indicate any provision of any law under which this levy was made. In the correspondence the levy has been termed as tonnage charge or royalty. Whether such royalty was payable had to be shown by the respondents but our attention has not been drawn to any provision of law to pursuance of which this amount is claimed. It seems to us that steel scrap may be liable to excise duty or some other tax but it is not the case of the respondents that recovery has been made as excise duty. The respondents have on the other band referred to West Pakistan Land Revenue (Baluchistan Second Amendment) Ordinance, 1977 promulgated b; the Governor of Baluchistan on 13th December, 1977. By this Ordinance it has been provided that a Revenue Officer could make retrospective special assessment in cases covered by Clause (b) of subsection (1) of section 70 of the Land Revenue Act, 1967. Section 70 (1) (B) of the Land Revenue Act, provides for special assessment being made by the Revenue Officers in cases where lands are sold, leased or granted by the Government, Baluchistan Ordinance only provides for such special assessment being made with retrospective effect. In such context Mr. S. M. Sadiq the. learned Advocate has invited our attention to subsection (1) of section 56 of Land Revenue Act, to sustain an argument that the land in question is not at all liable to land revenue. Clause (e), subsection (1) of section 56 of the Land Revenue Act exempts waste and barren laud, not under cultivation for a continuous period of six years from payment of any land revenue. He submits that no assessment could be made in cases where land was not liable to payment of land revenue. It is not the case of the respondents that the land was not barren. All that is stated in the parawise comments is that Clause (e) of subsection (1) of section 56 of the Land Revenue Act was not attracted. However, it is stated that assessment has not been made for the reason of bringing waste and barren land under cultivation Indeed the stand of the respondent Board of Revenue in the parawise comments is confusing and it seems even they are not clear as regards the justification underlying the recovery. Land revenue is always payable on land under cultivation but waste and barren land is never liable to assessment. Moreover the West Pakistan Land Revenue (Second Baluchistan Amendment) Ordinance XVII of 1977 was promulgated on 13th December, 1977 and by its terms it only enables special assessment with retrospective effect. In the present case the notification making the levy was issued on 21st October, 1975, a date far earlier than the date of promulgation s of the Ordinance. This Ordinance cannot therefore be pressed into service by the respondents to justify the enhanced levy, moreso when its term do not import any curative effect. Our attention has also been invited to West Pakistan Land Revenue (Baluchistan First Amendment) Ordinance IX of 1975 by which a general exemption was given in respect of all land in Baluhistan from payment of land revenue. That being the case no land revenue is payable on this land the impugned order/notification dated the 21st October 1975, which has been issued in pursuance of powers conferred by Clause (b) of section 70 of the Land Revenue Act, 1967, could not be pressed into service by the Government for such levy. Under these circumstances we hold that notification dated the 21st October, 1975, does not apply in the case of the petitioner because the land is privately owned, had not been sold or leased or granted by the Government, and has remained barren for a period of six years. We further hold that there is no law providing for imposition of any royalty. No such law has been placed before us. Mr. S. M. Sadiq, Advocate has in the alternative contended that notification dated 21st October, 1975, imposing the tax being retrospective in its terms and effect is in valid to that extent. In view of what we have said above in regard to the validity and vires of the notification it is not necessary to cater into the question of retrospective effect of the notification. The last question is in regard to relief. The petitioner claimed refund of the amount paid by him to the Deputy Commissioner, on 31st July, 1976. This .;mount was paid under protest and on pain of steel scrap being refused transportation to Karachi. There is no dispute that the amount has been paid. Initially it came to our mind whether in exercise of jurisdiction under Article 199 of the Constitution we would pass an order directing the refund of the amount. Mr. S. M. Sadiq Advocate has invited our attention to cases of Salah-ud-Din and 2 others v. Frontier Sugar Mills and Distillery Ltd., Takhat Bhai and 10 others (P

1. D 1975 S C 244) and Collector of Central E:ccise and Land Customs and 3 others v, B Aziz-ud-Din Industries Ltd. Chittagong (P L D 1970 S C 439). It has been held in these cases that if on a determination of legal instruments it is found that some amount has been illegally recovered by Government a direction could be made by the High Court for refund of the amount. On the other hand withholding this remedy would result in multiplicity of litigation because the petitioners would be forced to file a suit for reco very. The law has never looked with favour on multiplicity of litigation. In these circumstances we grant the petition and direct that the amount of Rs. 1,33,732 recovered by the respondents should be refunded to the petitioner.We also grant costs in favour of the petitioner. M Y' H' Petition accepted.