P L D 1975 Supreme Court 667 (PLP)

15. Presentation of Licence Form.‑(1) Intending importers shall submit licence forms for authentication through the scheduled banks nominated by them. Licence forms will be authenticated by the Licensing Authority and registered with the State Bank before delivery at the counter to the scheduled bank concerned." Pursuant to the above Policy Order, on 4‑8‑1972 the respondent applied a through his Bankers for the import licence for certain cinematograph films borne on the free list and deposited Rs. 1,400 for the purpose. However, on 9‑8‑1942, item No. 49 of the free list set out above was amended in material, respect. The amendment was notified in the Gazette on 10‑8‑1972 and in so far as it is material to this case read: "In the aforesaid order:‑ (2) in Annex. I‑, (ii) against S. No 49 in column 1, in column 5, the following entry shall be added, namely:‑ 'To be allowed only through the Agency to be specified by the Ministry of Information and Broadcasting'." The effect of this amendment was that as from the date of the amendment, cinematograph films could be imported from abroad only through an official agency to be named by the Ministry of Information and Broadcasting and private importers were disqualified from importing the same. As a result of the amendment, the Licensing Authority declined to authenticate the licence in favour of the respondent. The respondent was informed by his Bankers on 24‑8‑1972 that owing to "change in policy" import licence could not be issued to him. Aggrieved by the refusal of the Licensing Authority the respondent moved writ petition to call in question the refusal of the Licensing Authority to authenticate the licence. A learned Singe Judge, however, dismissed the writ petition in limine on the ground that the juristic right which the respondent herein claimed and sought to enforce was clearly dependent "on the authentication of the licence", which would have enabled him to import the cinematograph films which otherwise he could not import in view of the provisions of section? of the Act. The learned Single Judge opined that by applying to the Licensing Authority, no right in favour of the respondent herein was created and, therefore, there was no question of infringement of any such right by the amendment of 9‑8‑1972 to item No. 49 in the Import Policy Order. It seems that with the coming into force of the Import Policy Order, a press note was also issued on 23‑5‑1972 explaining the broad features of the new import policy and the improvements it had brought 4n its wake over the policy which had hitherto been in force. The press note also stated that a registered commercial importer applying for licence through his Banker, for an item on the free list will get the licence within 48 hours of his application being forwarded by his Bank, and I that instruction to that effect had already been issued to C. C. I. & E. and who had also been forbidden from refusing authentication of any application for licence in respect of an item on the free list, if the applicant fulfilled requirements of the Import Policy. Before the learned Single Judge, reliance was placed on behalf of the respondent, on the above press note and it was urged that the direction for the issuance of licence within 48 hours for an item on the free list was mandatory which the Licensing Authority could not disobey and therefore the respondent herein had acquired a "vested right," for the grant of import licence, which could not be adversely affected by the subsequent amend ment in item No. 49 on the free list. The learned Single Judge, however, repelled the plea and took the view that the instruction as to the time within which the Licensing Authority shall authenticate the license could not override the provisions of the statutory order as amended, which confined the import of cinematograph films on free list only through the official Agency named by the Ministry of Information and Broadcasting. On appeal by the respondent herein, the Letters Patent Bench took the view that by applying on 4‑8‑1972 for the cinematograph films and complying with all the conditions in force on that date, the respondent had acquired a "vested right" to have his application authenticated within two days of the making of the application and that the refusal by the Licensing Authority to authenticate the licence within two days of the submission of the application through the bank was "without lawful authority". It appears that before the Letters Patent Bench an objection taken on behalf of the appellants herein that in view of the provisions of section 3(2) of the Law Reforms (Amendment) Act, 1972, the respondent's Letters Patent Appeal did not lie, was repelled. Leave to appeal was granted by this Court to examine the following three questions, namely:‑ (i) Whether application for grant of licence to import cinematographic films created a legal right in the respondent which could be sustained in a superior Court in writ jurisdiction? (ii) Whether writ of mandamus could issue to the Controller of Imports and Exports to do that which at the time when the writ was issued he was not required by law to do? (iii) Whether under the proviso to section 3(2) of the Law Reforms (Amendment) Act, 1972, a Letters Patent Appeal was competent in this case? Raja Muhammad Anwar, the learned Deputy Attorney‑General, who appeared for the appellants, did not press the third ground with the avowed object of obtaining a declaration of law on the first two questions which undoubtedly are of general public importance. His argument in support of the appeal on the first point was that grant of licence simpliciter, is a privilege and its refusal does not infringe any right unless licence is coupled with a grant and according to learned counsel, there was none in it a instant case. In support of the proposition that no right of any kind had become vested in the respondent, the learned Deputy Attorney -General relied upon a number of excerpts from Standard Law Lexicons, which explain the real nature of a licence which in nutshell is that "it makes an action lawful, which without it would have been unlawful". It was emphasized that until licence was actually issued in favour of the respondent there was no question of creation of any right or interest being created in favour of the respondent. Mian Nisar Ahmad, learned counsel for the respondent on the other hand supported the judgment of the Letters Patent Bench and the reasons upon which it was based. He particularly relied upon the recent decision of a Bench of the Lahore High Court in Shameem Textile Mills v. The Republic of Pakistan (P L D 1972 Lah. 572) wherein "the right to apply" for import licence was held to be "a valuable and not a fake right" which is to be decided in accordance with law. He further argued that right to engage in lawful business or profession was guaranteed by the Constitu tion and the refusal by the Licensing Authority amounts to a denial of that right which has been rightly restored by the High Court in the Letters Patent Appeal by issuing direction in the nature of the mandamus issued to the Licensing Authority. It will be appropriate to examine in the first instance, whether the respondent can invoke any provision of the Constitution in the Chapter relating to the Fundamental Rights for the grant of licence for the import of films. Article 18 of the Constitution, which relates to the freedom of trade, business or profession, which corresponds to Article 15 of the, Interim Constitution, and which incidentally held the field at the relevant time, assures the citizens the right to enter upon any "lawful profession or occupation" and "to conduct any lawful trade or business". It is important to point out that the word "lawful" qualifies the right of the citizen in the relevant field. This clearly envisages that the State can by 13w ban a profession, occupation, trade or business by declaring it to be unlawful which in common parlance means anything forbidden by law. Prostitution, trafficking in women, gambling, trade in narcotics or dangerous drugs are common place instances of unlawful profession or trade. These are inherently dangerous to public health or welfare. Therefore, on the wording of Article 18 of the Constitution, the right to enter upon a profession or occupation or to conduct trade or business can hardly be described to be a constitutional or fundamental right when such right may be denied) by law. In this respect our Constitution stands in sharp contrast with the corresponding provision of the Indian Constitution which omits the use of word "lawful" in the relevant provision. In the instant case, as pointed out already, section 3(1) of the 1950 Act confers power of the widest amplitude on the Federal Government to prohibit, restrict or otherwise control, the import and export of goods of any specified description. Thus a complete ban on the import of a particular variety of goods is clearly envisaged be the provision. The vires of the sweeping provision was not questioned by learned counsel for the respondent. Similarly paragraphs 14 and ' the Import Policy Order, which were the sheet‑anchor of the respondent's case in the High Court, do not create an unqualified statutory right in favour of the respondent either. Paragraph 14 of the Order begins with the limiting words "Unless otherwise specified . . . .". The Gazette notification issued on 10‑8‑1972 by which item 49 relating to the import of cinematograph films was amended so as to prohibit the import of cinematograph films by private parties at once negatives the alleged right claimed by the respondent for the grant of licence. The provision of Article 14 set out above on its wording must yield to any limiting condition that the Federal Government might think fit to impose. The Gazette notification of 10‑8‑1972 imposed such limitation, which must be given full effect. Thus it is futile to contend that the respondent had any legal right to apply and obtain licence under the provisions of the paragraphs 14 and 15, notwithstanding the amendment in item No. 49, which it is not disputed, the Federal Government was competent to make. The correct legal position therefore, appears to be that, on 4‑8‑1972, when the respondent applied for licence, he was eligible for the grant under the dispensation then in force, but became ineligible by reasons of the amendment in the statutory instrument under which he had applied. The next question to be seen is whether the respondent, by applying on 4‑8‑1972 and satisfying all other conditions for the grant of licence, before the amendment of item No. 49, became vested with any legal right for license, of which could not be divested by the subsequent amendment on 10‑8‑1972. This begs the question as to the true nature of licence. According to Stroud's Judicial Dictionary, 3rd Edn., Vol. 2 at page 1638:‑ "When one finds the word `licence' used in a statute the presumption is that it is intended to designate a purely personal privilege". (Per Black, J.) in Russel v. Ministry of Commerce for Northern Ireland, (1945) N. I. 184, 193). (2) A licence is an `authority to do something which would otherwise be wrongful or illegal or inoperative'. (Per Latham, C. J.) in Federal Commissioner of Taxation v. United Aircraft Corporation (68 C L R 525). On the same page of the treatise there is a reference to the judgment of Romer L. J., in Warr v. London County Council (1) which approved and reproduced the following observation of L. C. J., Vaughan in Thomas v. Sorrell decided as far back as 1673: "A dispensation or licence, properly passeth no interest, nor alters or transfers property in any thing but only makes an action lawful, which, without it, had been unlawful, e.g. a licence to hunt in a man's park and carry away the deer killed to his own us and to cut down a tree in a man's ground and to carry it away the next day after his own use, are licences as to the acts of hunting and cutting down the tree; but as to the carrying away of the deer killed, and tree cut down, they are grants." Now attending to this passage in conjunction with the title "Licence" in Brooke's Abridgement from which and particularly from paragraph 15, it appears that a mere licence is revocable, but that which is often called a licence is something more than a licence; it often comprises or is connected with a grant and the party who has given it cannot in general revoke it, so as to defeat the, grant to which it was an incident. In the instant case licence having been refused to the respondent, there is no question of any grant being created in his favour. Similarly, in American Jurisprudence, Vol. 33, in the Chapter entitled "`Licences" in paragraph 2 in Part One, the general nature of licence is defined: "In its specific sense, to license means to confer on a person the right to do something which otherwise he would not have the right to do. A licence is in the nature of a special privilege, rather than a right common to all, and is often required as a condition precedent to the right to carry on business or to hold certain classes of property within the jurisdiction. A licence is not, however, a contract with the sovereignty issuing it, not property in any constitutional sense." To almost the same effect is paragraph 92 of Corpus Juris, Vol. 37 at p. 238, which however goes on to say:‑ "But where other conditions are imposed, he (the applicant) is not entitled to a licence as a matter of course by merely paying or tendering the fee or tax required." Thus it becomes clear that it is wrong to suggest that the respondent had acquired any legal right for the grant of licence by merely applying for the same and deposit of the necessary fee. Grant of licence remains a privilege until it is actually granted and is accompanied by a grant. In the instant case, licence has been withheld ab initio and, therefore, too legal liability is incurred and there is no further question whether licence was coupled with grant. Learned counsel for the respondent, however, argued that the respon dent having complied with all the formalities for the grant of licence; the Licensing Authority was under a duty to grant licence to the respondent within two days of making his application as was stated in the press note issued on 23‑5‑1972. The direction in the press note, according to learned counsel, was mandatory in its effect, and any neglect or default by the Licensing Authority to comply with the require ment cannot operate to the disadvantage of the respondent nor can the Licensing Authority take advantage of its own default. The argument proceeds on the assumption that the respondent by applying for the licence and complying with conditions for the grant of licence had become entitled to it as a matter of right. The fallacy of this assumption had been sufficiently demonstrated. Furthermore, as rightly pointed out by learned Single Judge, the limitation of 2 days' time within which the Licensing Authority was required to issue the licence not being provided in the Policy Order of 1972, which alone had the statutory effect, was merely in the nature of a departmental instruction for the ministerial authorities for the expeditious disposal of the business and, therefore, directory in its effect. It would, therefore, be wrong‑ to suggest that any disobedience or non -compliance with the direction would sustain a claim for a writ in the nature of mandamus in the absence of a clear legal right in the respon dent herein and a corresponding legal duty on the part of the Licensing Authority. On the above analysis, there is no substance in the further argument of learned counsel for the respondent, that the amendment of item 49 in the Policy Order on 10‑8‑1972, could not impinge upon the respondent's entitlement on the basis of his application earlier on 4‑8‑1972. It must tie conceded, however, that the Courts have always endeavoured to protect vested rights, by refusing to allow statutes to have retrospective operation, unless such a result becomes inevitable from the express language of the statute or its necessary intendment. But all such cases have been examined with reference to a right already "in existence". On this aspect of the case, reference to Starey v. Graham ((1899)1 Q B 406) would be instructive. In that case essential facts were these: In 1888 a restriction was for the first time imposed on persons desiring to practise as patent agents, with a saving for rights acquired before the Patents Act, 1888 (English Statute since repealed) came into force. By rules under that Act made in 1890, and having legislative force, the business of a patent agent was put under regulations. Channell, J. held in that case that "right acquired" did not include a right on the part of persons practising as patent agents before the Act of 1888 to practise and describe themselves, as such, after the Act. He defined a "right acquired" as "some specific right which in one way or another has been acquired by an individual and which some persons have got and others have not". It is not a "right" in the popular sense. The learned Judge added: "Before the passing of the pct, everybody had the right to call himself a patent agent, that is to say, the law did not forbid him to do so. A right enjoyed in that way is not within the meaning of this saving clause a `right acquired' other wise it is obvious that such a clause would nullify the operation of any Act in which the clause was inserted." I respectfully agree with the above enunciation; it greatly helps in, distinguishing some of the precedent cases relied upon by the Letters Patent Bench in support of the judgment under appeal as will be seen presently. The foremost case relied upon by the learned Judges of the Letters Patent Bench was Shameem Textile Mill v. Republic of Pakistan (P L D 1972 Lah. 572) in which a direction in the nature of mandamus was issued to the Provincial Government to "restore the sanction" for setting up a factory on the finding that the "cancellation of sanction was without lawful authority". It is also important to point out that no direction was issued to the Federal Government which was also a party, for the issuance of licence for the import of machinery for setting up of the factory; rather the case was remitted to the Federal Government "to be decided afresh by (C. C. I. & E) in accordance with law". The facts of that case were, however, peculiar. The petitioner‑Company in that case, having decided to set up a factory in Lahore, comprising 40 rayon and art silk power -looms to be worked by 45 employees, applied to the Provincial Government for the sanction. According to section 5‑A(i) of the Factories (Punjab Amendment) Act, 1940, a factory could not be established in toe Province otherwise than with the sanction of the Provincial Government. By a proviso to the section it was however, provided that if in respect of an application made for the purpose, rejection was not communicated to the applicant within six months then "the applicant shall be regarded as having obtained that permission." The petitioner having failed to receive any intimation from the Provincial Government for more than six months of the making of the application, filed a writ petition in the High Court for mandamus requiring the Provincial Government to issue formal sanction for setting up of the factory. This petition was allowed and a direction was issued to the Provincial Government to grant the necessary sanction to the petitioner. No appeal against the judgment of the High Court was taken, though however, no formal sanction was issued by the Provincial Government either, until long thereafter. But this was hedged by a number of conditions, some of which, on the face of it, were harsh and unreasonable. Upon the petitioner's failure to satisfy those conditions, oven the belated sanction was cancelled by the Provincial Government. Consequent upon the cancellation of the sanction, the petitioner's request for the import Japan was also refused by C. C. I. & E. It was in these circumstances that mandamus was again issued to the Provincial Government to restore the sanction for setting up the factory. It will thus be seen that pivotal fact in the case was that by an express provision in the statute, sanction was deemed to have been granted. In then direction in the precedent case was issued to restore the sanction wrongfully cancelled by the Provincial Government as distinguished from refusing its initial grant, as in the instant case. There is a clear distinction between refusal to grant licence and to cancel licence already granted. In the latter case, legal rights are often created because of the incident of the grant as a sequel to the licence. In the instant case, there is no provision for the automatic grant of licence after the expiry of two days; rather Article 15 of the Import Policy Order, contemplates formal authentication of the import permit by the Licensing Authority and its registration with the State Bank of Pakistan before its delivery to the applicant through his Banker. Authentication and registration are both formal acts. Authentication in the relevant context, according to the Shorter Oxford Dictionary, means to give legal validity or effect". Therefore, the observation in the case of Shameem Textile viz., right to apply for import licence is not a fake right but is a valuable right", if I may say so with respect is rather widely worded and, therefore, must be read as confined to the peculiar facts of the case and not laying down a general proposition. In Montgomery Flour & General Mills Ltd. v. Director, Food Purchases, West Pakistan (P L D 1957 Lah. 914) the facts were again widely different. In that case the petitioner‑Company was already sanctioned quota of sugar by the Provincial Food Department. The petitioner‑Company, however, was a defaulter in respect of another Mill and the Provincial Food Department in order to pressurise the petitioner's Company, cancelled the quota of sugar for its default in the payment of price of wheat supplied to it for grinding in the other mill. There was no allegation that petitioner‑Company was in default in respect of price of sugar. It is, therefore, plain that the quota of sugar was cancelled for extraneous consideration which, on the face of it, was mala fide. It is no wonder, therefore, that a direction was issued to the respondents in the case to restore the quota of sugar. Again it is a case of cancellation of quota already sanctioned and not a case of fresh grant of permit or quota. In Ikram Bus Service v. Board of Revenue (P L D 1963 S C 564) the Regional Transport Authority declined to entertain application for grant of route permit from individual bus‑owners on the ground that the Provincial Government had issued instructions to the Authority to entertain applications for permits from registered companies only and not from individuals. The Act did not provide for any such distinction, therefore, the Courts had no difficulty in finding the refusal by the Regional Transport Authority, not only without jurisdiction but also discriminatory and therefore, in breach of the equality clause. In Rex v. City of London Licensing Justices Ex parte Stewart and another ((1954) 3 Q B D 270) the applicants were holders of a justices on licence in respect of certain premises in the City of London. In 1943, the premises were damaged by enemy action and remained closed and the licence was suspended in accordance with the provisions of the Finance Act, 1942. Later, in 1954, on an application made in that behalf, the applicants were granted permission for the removal of the licence to other premises in the City of London. The Licensing Planning Committee, however, imposed on the applicants a condition that they stall forthwith give an effective written undertaking to the Licensing Justices (i) to sell no intoxicating liquor under the licence for consumption off the premises, and (ii) to provide only one bar for use by the general public. The applicant duty gave the written undertaking. Later, they applied for grant of planning removal of the licence which was refused by me Licensing Justices on the ground that prohibition against removal was absolute. Mandamus however, was issued directing the Licensing Justices to grant the removal of licence. In this case, too, the applicants were previous holders of licence and their request for its removal to another premises which was held to be wrongfully refused. It would be wrong to read this case as authority for an affirmative answer to the first question. The distinction between initial registration under the Registration Importers and Exporters) Order and its subsequent suspension was clearly brought out in Faridsons Ltd., Karachi etc, v. Government of Pakistan, etc. (P L D 1961 S C 537) The former is a privilege assimilable to grant of licence which is entirely discretionary with the grantor. Accordingly, I answer the first question in the negative. On the second question, as explained already, lair is well settled that in the generality of cases, licence (simpliciter) is a privilege and not a leaf right; much less there is a legal duty for its grant. Therefore, exceptional cases apart, Mandamus would clot issue in such cases. Speaking generally in such cases tae emphasis is on policy, and any discretion vesting in the authorities is directed towards attaining the policy objective. Monogram 18, in Halsbury's Laws of England, 3rd Edition, Volume XI at p, 100 's also instructive on the point, It reads:‑ The order of mandamus will not be granted against one who is an inferior or ministerial officer, bound to obey the orders of a competent authority, to compel him to do something which is part of his duty in that capacity. Mandamus has accordingly been refused when it was sought thereby to compel a county treasurer to obey an order of quarter sessions; also when it was sought to compel a borough treasurer to pay the coats of a prosecution in obedience to the order of a Judge of assize or a Courts of quarter sessions. In the instant case, as already pointed out, section 3(1) of the 1950 .Act reserves to the Central Government power of the widest amplitude to prohibit, restrict or otherwise control the import of goods. What are to be imported, how and in what quantities and by whom they are to be imported are all questions of policy to be laid down by the Federal Government. Indeed, the Government has a along since the inception of the Act, frequently and materially altered import policies. These policies are determined generally with reference to the domestic needs their priorities, availability of foreign exchange and multitudes of other factors of which the Federal Government is the sole arbiter in exercise of its executive authority. The decision taken, falls within the realm of policy making. These policy decisions are binding on the subordinate, administra tive authorities as a matter of duty. In all such cases, orders made must conform to the policy decisions of the Government. The amendment made on 10‑8‑1972 in item No. 49 signified a change in policy and the respondent was informed that he was being refused licence because of "the change in policy" and not because of any other reason. On these facts, it is not possible to subscribe to the proposition that a writ of mandamus would lie against the Licensing Authority which would have the effect of defeating the policy, competently made by the Federal Government. Accordingly, I would answer the second question on which leave was granted also in the negative. For the foregoing reasons, I would accept the appeal, set aside the order of the Letters Patent Bench and restore that of the learned Single Judge in the High Court. In view of the conflict of opinion in the High Court and the difficult of the law point involved, I would leave the parties to bear their own costs. MUHAMMAD YAQOOB ALI, J.‑-I agree. ANWARUL HAQ, J.‑-I agree. S. A. H. Appeal accepted.