1998 PLP 706 (CLC)

M. S. Rakhshani for Respondents. Date of hearing: 5th August, 1997. IFTIKHAR MUHAMMAD CHAUDHARY, J.‑‑‑Petitioner M/s. Parks Pakistan. (Private) Limited Lahore Cantonment, Lahore with the joint venture of Jamdpal Import‑Export (Sarl) France imported second hand chair lifts and other equipments for installation at Hanna Lake, Quetta in pursuance of prior agreement with the Hanna Lake Development Authority. In this behalf petitioner opened a Letter of Credit in Allied Bank of Pakistan Limited at Quetta on 30‑5‑1996. The consignment arrived at Karachi Port where Bill of Entry was filed for the assessment of customs duty and other taxes on 20‑6‑1996 with IGM No.123 of 1996. Petitioner demanded clearance of imported consignment according to S.R.O. No.212(1) of 1991 and No. 213(1) of 1991 dated 14‑3‑1991. Collector of Customs respondent No.2 refused to concede to their request as S.R.Os. referred to hereinbefore have been rescinded by Ministry of Finance (respondent No.l) vide S.R.O. No.434(l) of 1996, dated 30‑6‑1996, thus instant Constitutional petition has been filed. Mr. Sarwar Javed, learned counsel for petitioner contended that petitioner is entitled for the concession of taxation in customs duty and other taxes as they had entered into agreement with M/s. Jamdpal Import‑Export (Sarl) on 15th May, 1995 prior to rescission of S.R.Os., dated 14th May, 1991, notwithstanding the fact that during the process of import of machinery these S.R.Os. have been cancelled. Reliance was placed by him on 1986 SCMR 1917 and 1994 MLD 1136. Mr. M.S. Rakhshani learned Deputy Attorney‑General argued that the doctrine of promissory estoppel would not be applicable against respondents because S.R.Os., dated 14th March, 1991 in pursuance whereof exemption/concession of duty was granted, have been rescinded by competent authority exercising statutory powers much prior to filing of Bill of Entry by petitioner at Karachi, therefore, customs duty and other taxes shall be assessed in accordance with S.R.O. which was operative at the time of submitting the Bill of Entries as it has been held in 1992 SCMR

883. He also strenuously urged that this Court under Article 199 of the Constitution of Islamic Republic of Pakistan, has no jurisdiction because petitioner is a Lahore based Company; whereas Offices of official respondents are situated at Islamabad and Karachi respectively. Moreover, customs duty and taxes have been assessed by respondent No‑2 at Karachi as consignment was imported through sea at Karachi Port‑ Reliance was placed by him on PLD 1997 SC

334. We heard parties' counsel arid carefully examined their respective contentions. Petitioner's main thrust of arguments is that the Government of Pakistan through C.B.R. to provide incentives for development of the industry of tourism exempted customs duty and other taxes vide SROs Nos.212(1) of .1991 and 213(1) of 1991, dated 14‑3‑1991, therefore, petitioner on account of such temptation decided to instal chair lift project in Balochistan with the collaboration of France based company Jamdpal Import‑Export. It is an admitted position that by means of these two S.R.Os read with SRO No.79(1) of 1995, dated 19‑1‑1995 Government of Pakistan Ministry of Finance has allowed exemption of 100% duty to importers of machinery if it was not being manufactured locally and Letter of Credit has been opened up to 30‑6‑1996, for installing industry in Special Industrial Zones. Subsequently by another S.R.O., dated 30‑1‑1996, the SRO No.70(1) of 1995 was amended whereby crucial date for opening of Letter of Credit was substituted to be 31‑1‑1996. Later on another development took place in pursuance whereof vide SRO No.434(1) of 1996, dated 30‑6‑1996 S.R.Os. No.212(1) of 1991 and 213(11 of 1991 were rescinded with immediate effect. The petitioner could not get tile benefit of exemption of customs duty and sales tax in pursuance of these two S.R.Os. including SRO No.70(l) of 1991, dated 19‑1‑1995 because letter of credit was opened by them on 30‑5‑1996. There is no cavil concerning the powers as well as jurisdiction of the authority to rescind the notification granting exemption in the customs duty and other taxes. In this behalf Honourable Supreme Court in "Pakistan v. Salahuddin" (PLD 1991 SC 546) has observed that doctrine of promissory estoppel indeed does not extend to legislative and sovereign functions, but executive actions are not excluded from its operation. As far as Notifications/S‑R.Os. are concerned, those were issued by Competent Authority in exercise of powers conferred upon them under the Customs Act or Sales .Tax for the purpose of granting exemption in the customs duty and other taxes. Because there had not been any executive commitment by the Government of Pakistan or its subordinate functionary, therefore, after rescinding the notification, no benefit therefrom can be claimed by the petitioner on the pretext that in view of the incentives provided by the Government, the Letter of Credit was opened on 30‑5‑1996. It is equally important to note that the exemption of 100 % customs duty and other sales tax was available to the Importers establishing industry in the special zones provided Letter of Credit is opened up to 30‑1‑1995. This amendment had been introduced in the original S.R.O. about four months before the opening of the Letter of Credit by the petitioner, therefore, in such view of the matters, judgments cited by the learned counsel Mr. Sarwar Javed reported in 1986 SCMR 1917 and 1994 MLD 1136, would not lend any help to him because the Honourable Supreme Court in "Mian Nazir & Sons Industries v. Government of Pakistan" (1992 SCMR 883) had laid down that no vested right would accrue in favour of Importer to refuse payment of the duty subsequently upon rescission or revocation of such order. In this very judgment it has further been held that section 31‑A of the Customs Act clearly stipulates that any amount of duty which becomes payable in consequence of withdrawal of concession from day, even though such withdrawal takes place after conclusion of a contract for the sale of goods or opening of Letter of Credit, would be payable in terms of section 30 with reference to the date of filing of the Bill of Entry. Thus, following the dictum of the Supreme Court, it is held that respondent No.2 had rightly demanded customs duty and sales tax in accordance with law, rules and regulations which were applicable on the date of filing of the Bill of Entry. As such action, having been taken with lawful authority, does not warrant interference by this Court. There is yet another important point for consideration concerning jurisdiction of this Court which has been forcefully pressed by Mr. M.S. Rakhshani learned Deputy Attorney‑General. It is an admitted fact that petitioner had opened.Letter of Credit at Quetta, but as far as cause of action against respondent No.2 is concerned, it has accrued at Karachi where the customs duty and other taxes were assessed on arrival of the consignment at Karachi Port. So far functionaries of Customs Department generally in Balochistan and particularly in Quetta are concerned, no adverse action has been taken by them against petitioner. Similarly, respondent No. l had also not passed any order adverse to the interest of petitioner within the territories of Balochistan, therefore, the question would be as to whether merely for the reason that Letter of Credit was opened at Quetta on 30‑5‑1996 petitioner legitimately can invoke jurisdiction of this Court. In this behalf hounourable Supreme Court recently in the case reported in PLD 1997 SC 334 examined identical proposition and observed as under: "The learned Judges of the Division Bench have pointed out the language originally employed in Article 98(2)(a)(i) of 1962 Constitution prior to the incorporation of clause (c) by the First Amendment Act, 1963, for distinguishing the case of Asghar Hussain v. Election Commission of Pakistan and others PLD 1968 SC

387. The view found favour with the learned Judges of the Division Bench in the case in hand seems to be in consonance with Article 199(1)(a)(i) and (ii) of the Constitution of the Islamic Republic of Pakistan, 1973, hereinafter referred to as the Constitution. A perusal of the above sub‑clause (a)(i) of the above Article indicates that a High Court has power to issue a direction to a person performing within the territorial jurisdiction functions in connection with the affairs of the Federation, a Province or a local authority to refrain from doing anything he is not permitted by law to do or to do. Similarly, under sub‑clause (a)(ii) a declaration without lawful authority or of no legal effect can be given by a High Court in respect of any act done or proceeding taken within its territorial jurisdiction by a person performing functions in connection with the affairs of the Federation, a Province or a local authority. " Above matter also pertains to payment of regulatory (duty) in respect of consignment which arrived from abroad at the Port of Karachi, but the order of levy of the tax was challenged by petitioner Sandal Bar Enterprises (Pvt.) Ltd. in jurisdiction of Lahore High Court. But the writ petition was disposed of for want of jurisdiction and thereafter, matter was taken up before Hon'ble Supreme Court where above rule of law was laid down. It was also observed by honourable Supreme Court in the said judgment that it has become a common practice to file a writ petition either at Peshawar or Lahore or Rawalpindi or Multan to challenge the order of assessment passed at Karachi by adding a ground for impugning the notification under which a particular levy is imposed. This practice is to be deprecated. The Court is to see, the dominant object of filing the writ petition. Consequently leave was refused. Thus, following above dictum of Honourable Supreme Court, we are also inclined to hold that respondents Nos. 1 and 2 have not passed any order challengeable before this Court within its territorial jurisdiction for the purpose of declaring their such action without lawful authority or of no legal effect. As such we are of the opinion that petition is not maintainable for want of territorial jurisdiction as well, in view of above law laid down by Honourable Supreme Court. For the foregoing discussion we see no merit in the petition which is dismissed with costs. A.A./665/Q Petition dismissed,