2001 PLP 1842 (CLC)

6. Provisions of Article 151 of the Constitution of Islamic Republic of Pakistan, 1973, are relevant and are reproduced for ready reference:‑‑ "Article

151. Inter‑Provincial trade.‑‑‑ (1) Subject to clause (2), trade, commerce and intercourse throughout Pakistan shall be free. (2) ([Majlis‑e‑Shoora] Parliament) may by law impose such restrictions on the freedom of trade, commerce or intercourse between one Province and another or within any part of Pakistan as may be required in the public interest. (3) A Provincial Assembly or a Provincial Government shall not have power to‑‑ (a) make any law, or take any executive action, prohibiting or restricting the entry into, or the export from, the Province of goods of any class or description, or (b) impose a tax which, as between goods manufactured or produced in the Province and similar goods not so manufactured or produced; discriminates in favour of the former goods or which, in the case of goods manufactured or produced outside the Province discriminates between goods manufactured or produced in any area in Pakistan and similar goods manufactured or produced in any other area in Pakistan. (4) An Act of a Provincial Assembly which imposes any reasonable restriction in the interest of public health, public order or morality, or for the purpose of protecting animals or plants from disease or preventing or alleviating any serious shortage in the province of an essential commodity shall not, if it was made with the sent of the President, be invalid."

7. It will be seen that Article 151(1) lays done that subject to clause (2), trade, commerce and intercourse throughout Pakistan shall be free. Article 151(2) empowers the Parliament to impose restriction on the above freedom as may be required in the public interest. Article 151(3) is in negative form and prohibits the Provincial Assembly or a Provincial Government to do the things mentioned in clauses (a) and (b). For the case, the relevant provision is that Provincial Government shall not have power to impose a tax, which, as between the goods manufactured or produced in the Province and similar goods manufactured or produced in any area in Pakistan, tends to discriminate is to favour of the former. In other words by imposing the impugned duty the respondent‑Government has discriminated between the goods produced by the petitioner and the goods produced by the rivals in Sindh and Balochistan. However, this discrimination does not seem to be in favour of the petitioner and as such may not be hit by Article 151(3)(b). The impugned levy impinges upon the freedom, as enshrined in Article 151(1). Reliance of Mrs. Nasira, Advocate on Mirpurkhas Sugar Mills Ltd. v. District Council, Tharparkar and 2 others 1990 MLD 317, Sayphire Textile Mills Ltd. and 9 others v. Government of Sindh and others PLD 1990 Kar. 402 is correct. In the first case the export tax imposed by Zila Council on the Sugar produced by the petitioners therein was declared as violative of the Con4titutional pro‑Visions. In the second case also the export duty imposed upon the products of the petitioners‑Mills was not upheld on the touchstone of Article 151 of the Constitution. Learned counsel also relied on Atiabari Tea Co. Ltd. v. The State of Assam and others AIR 1961 SC 232 and on perusal of the judgment the reliance again seems to be correct. I, therefore, hold that impugned imposition of export duty is violative of Article 151(1) of the Constitution.

8. This should be enough to dispose of this petition but it would be appropriate if the existence of power available to the Government under section 31 of the Act may also be examined and determined. Section 31 for the sake of convenience is reproduced:‑‑ "Section

31. Duty on excisable articles.‑‑‑ A duty at such rate or rates as the Provincial Government shall direct, may be imposed, either generally or for any specified local area, on any excisable article‑‑ (a) imported, exported or transported in accordance with the provisions of section 16; or (b) manufactured or cultivated under any licence granted under section 20; or (c) manufactured in any distillery established, or any distillery or brewery licensed under section 21: Provided as follows:‑‑ (i) Duty shall not be so imposed on any article which has been imported into Pakistan and was liable on importation to duty under the Tariff Act, 1894 (VIII of 1894) or the Customs Act, 1969 (IV of 1969). (ii) Omitted by A.O., 1937. Explanation.‑‑‑ Duty may be imposed under this section at different rate according to the places to which any excisable article is to be removed for consumption or according to the varying strengths and quality of such article.

9. The section enables the Provincial Government to impose on any excisable article a duty. at such rate or rates as the Provincial Government shall direct, on such excisable article being imported, exported or transported in accordance with the provisions of section 16 or manufactured or collected under any licence granted under section 20 or manufactured in any distillery established or any distillery or brewery licensed under section

21. It is to be seen that clauses (a), (b) and (c) are disjunctive. The word "or" separates all the three clauses, which would indicate the intention of the Legislature that the duty can be imposed either under clause (a) or (b) or (c) but cannot be imposed under (a) and also under clauses (b) and (c). As I understand this section it does not authorise the Government to impose the duty twice on an excisable article. In other words if an excisable article has been subjected to duty under clause (b) or (c) it cannot again be subjected to duty under clause (a). This interpretation is supported by language of section 16, which lays down that intoxicants shall not be imported, exported or transported except after payment of any duty to which it may be liable under this Act. The word "or" separating the three clauses cannot be read as "and".

10. In this case undisputedly the petitioner pays the duty on the intoxicant manufactured or brewed when it is taken out of the brewery or factory premises. In fact Mrs. Nasira, Advocate claims that Rs.30,000 per month is spent by the petitioner on salaries of the excise staff posted by the respondent‑Government at its brewery. The break‑down of the various taxes and duties being paid by the petitioner, is stated in para.3 of the petition. In its parawise comments, the respondents have admitted the contents of para.

3. This means that the petitioner is paying Still Head Duty at the rate of 82% of Ex‑Distillery price and under the impugned notification is now required to further pay the export duty. In other words the respondent‑Government is imposing duty under clause (b) of section 31 and also levying export duty under clause (a). This it cannot do as section 31 does not authorise the Government to impose and recover both.

11. For the above reasons this petition is allowed. As noted this Court declined suspension of the impugned notification at the time of preliminary hearing but directed the respondents to maintain a complete record of the export duty collected, which is to be restored to the petitioner in the event of success. As the petitioner has succeeded, respondents are directed to restore the amount collected under the impugned notification, not later than eight weeks from the date of this judgment. Parties are left to bear their own costs. Q.M.H./M.A.K./M‑570/L Petition allowed.