1989 PLP 1539 (CLC)

Date of hearing: 21st March, 1989. NAZIR AHMED BHATTI, J.‑‑Charsadda Sugar Mills petitioner herein is a public limited company carrying on the business of manufacture and sale of sugar. It received an order dated 15‑1‑1981 from the Government of N.‑W.F.P. in the Local Government and Rural Development Department, respondent No.l herein to the effect that in a meeting held between the representatives of the petitioner, Municipal Committee, Charsadda respondent No.2 herein and representative of respondent No.l, the Governor of N.‑W.F.P. was pleased to issue the following directions under section 157 of the N.‑W.F.P. Local Government Ordinance, 1979 (hereinafter referred to as the Ordinance) with regard to the levy and collection of octroi:‑ "Charsadda Sugar Mills will pay the arrears of octroi charges on cane (on behalf of the growers) with effect from 10‑11‑1980 to date to Municipal Committee, Charsadda. Deduction from growers will be the Mills responsibility." The petitioner made a representation to the respondent No.l wherein it conveyed its inability to collect the said octroi and further submitted that it was the liability of the growers and the order in question be withdrawn but without any success. According to the aforesaid direction a sum of Rs.2,09,411 had to be recovered from the growers by the petitioner for the period from 10‑11‑1980 to 22‑1‑1981. By the writ petition in hand the petitioner has challenged the aforesaid direction of the respondent No.l inter alia on the ground that under the Ordinance the respondent No.l had no jurisdiction to make the impugned order against the petitioner and the same was illegal, void and made without lawful authority and of no legal effect.

2. The respondent No.l in their comments submitted that the impugned decision was taken in several meetings in the presence of the Managing Director of the petitioner and they were estopped by their conduct to challenge the same. It was also contended that the writ petition suffered on account of laches.

3. The respondent No.2 .in their written statement virtually adopted the same position as was taken up by respondent No.l.

4. We have heard learned counsel for the parties at length.

5. It is an admitted fact that the octroi in dispute was imposed by the Municipal Committee Charsadda respondent No.2 on sugarcane which was to be supplied by the growers to the petitioner and it was recoverable from the growers. This octroi was not payable by the petitioner.

6. It is also noteworthy that the very contents of the impugned order would reveal that the octroi in dispute had been made leviable and recoverable with effect from 10‑11‑1980, which date was probably the commencement date of the Sugar Mills of the petitioner whereas the direction was given on 15‑1‑1981.

7. Section 157 of the Ordinance under which the impugned direction is alleged to have been made pertains to the power of Government to give directions. Subsection (1) of this section appears to be relevant for the purposes of the writ petition in hand and it is reproduced as under:‑ "(1) Government may direct any Local Council or any person or authority responsible thereto to take within such period as may be specified such action as may be necessary for carrying out the purposes of this Ordinance." The learned counsel for the petitioner has contended that collection of this octroi was the sole duty and responsibility of the respondent No.2 and this duty and responsibility could not be thrown on the shoulders of the petitioner. On the contrary the learned counsel for both the respondents contended that under the aforesaid provisions of subsection (1) of section 157 of the Ordinance the Government was competent to give directions to the petitioner to collect the octroi in dispute.

8. We have given our serious consideration to the contentions raised by the learned counsel for the parties. The minute perusal of the provisions of subsection (1) of section 157 of the Ordinance would reveal that the power given to the Government to give directions pertains to the Local Council or any person or authority responsible thereto to take such action as may be specified. This would mean that the power of Government under this provision of the Ordinance is limited to give directions to the Local Council or any employee or authority thereof. This power of Government cannot be exercised in relation to any third party which is not under the jurisdiction or authority of the Local Council. We are, therefore, of the considered opinion that the power exercised by Government under section 157 of the Ordinance was misconceived and actually this power was not available to Government in relation to the petitioner.

9. The learned counsel for both the respondents again placed reliance on rule 105 of the N.‑W.F.P. Local Councils (Octroi) Rules, 1984 and urged that the respondent No.2 had the power with the approval of Government under sub‑rule (1) thereof to compound octroi with any business concern or institution. It was their contention that the impugned direction had the effect of composition of octroi in question between the petitioner and the respondent No.2. We have given our serious consideration to this aspect of the matter as well. The minute perusal of rule 105 of the aforesaid rules would indicate that the composition of any octroi by Local Council can be with that party or institution which is liable to pay any octroi on its goods whereas the octroi in dispute was leviable on the growers of sugarcane in connection with the supply of the same to the petitioner and it was also payable by the growers. This octroi or any part thereof was neither levied on the petitioner nor was it payable in connection with the goods prepared by the petitioner.

10. We, therefore, consider that the provisions of rule 105 of the aforesaid Rules were also not available to both the respondents for making the petitioner liable for the collection of the octroi in dispute.

11. There is yet another aspect of the mattes The octroi in dispute was made liable and had become recoverable with effect from 10‑11‑1980 and the petitioner was made responsible for its collection by an order made on 15‑1‑1981. How could the petitioner recover the octroi in dispute for the period from 10‑11‑1980 to 15‑1‑1981 when they had already made payment of the Price of the sugarcane to the growers and had got no control over the growers for‑ the aforesaid period. The petitioner was not possessed with any coercive measures to collect arrears of octroi on behalf of the respondent No.2. The petitioner also could not compel any grower to pay the octroi duty for the period after 15‑1‑1981 if any grower refused to pay the same, because in that case as well the petitioner had no power to coerce the growers to pay the same.

12. In so far as the question of laches is concerned it may be stated that the impugned order was made on 15‑1‑1981 and the writ petition was filed on 17‑2‑1981, after one month and two days. We do not think that this can be a case of lashes because many formalities had to be completed, such as the drafting of the writ petition and collection of documents etc.

13. For the aforesaid reasons we are of the considered opinion that the respondent No.l had no jurisdiction under the law to make the impugned direction and acted in excess of its jurisdiction. The impugned direction and order was made without lawful authority and was of no legal effect and we would declare the same to be void. We will, therefore, accept this writ petition and set i aside the impugned direction and order of the respondent No.l. There shall however be no order as to costs. AA./749/P Petition accepted.