1986 PLP 137 (CLC)

MUHAMMAD ZAHOORUL HAQ, J.‑‑This petition is directed against the action of the Customs Authority where they charged 40$ duty n import of cement by the petitioner.

2. The relevant facts are that 1,00,000 (one lac) bags were imported by the petitioner. They opened Letter of Credit for the same on 10‑10‑1981 and the goods were shipped on 8th July, 1982 and Bill of Lading was issued for the same. The cement arrived in Pakistan on 1‑9‑1982. The petitioners did not get the cement cleared for home consumption but filed a bill of Entry Form for Bond on 14‑9‑1982 for the entire consignment. The Bill of Entry form bond submitted by the petitioners showed the rate of duty at 25$ and the Customs Authority assessed the duty at the same 25$ ad valorem for the entire consignment on 14‑9‑1982 and thereafter, the cement was booked into bonded ware houses.

3. It is an admitted position that from 10th August, 1981 till 9th January, 1983 25$ ad valorem was chargeable on the import of cement.

4. On 10‑1‑1983 the Government of Pakistan issued notification whereby the previous notification, dated 5‑6‑1981 in respect of the duty on cement was amended and against heading No. 25.23 in column No.1, in column No. 3 for the figure '25', the figure '40' was substituted. The effect of the same was that from 10th of January, 1983 40$ duty became leviable for the import of cement in Pakistan.

5. Thereafter, the petitioners during different dates in February and March, 1983 filed bills of entry form bond for different quantities of cement in which they had shown the amount of duty chargeable at 25% but the same was corrected later on as 40% at the instance of the Customs Authority and the said cement evidently was assessed by the Customs Authority at 40% duty. The petitioner submit that they were forced to pay duty at 40% for clearance of the cement which they finally paid and got the goods cleared.

6. The petitioners filed this petition in May, 1983 alleging that they had acquired a vested right in clearing the cement at 25% of duty because when they had placed the order for the cement as well as when it was shipped and arrived in Pakistan and when it was assessed to duty under section 80 for being warehoused on 14‑9‑1982, the cement was liable to a duty of 25% only and since they had acquired that right and it had become vested in them and thereafter, they could not be deprived of their vested right by a subsequent notification issued by the Government on 10‑1‑1983 which was merely a delegated legislation and could not be given retrospective effect so as to affect the vested right of the petitioners acquired between August, 1981 to September, 1982.

7. The learned counsel for the petitioner has relied upon P L C 1973 S C 439 where it was held that a vested right cannot be altered by giving a retrospective effect to a delegated legislation. This was a case of Excise Duty having been exempted for 4 years from Industries established in Chittagong but the exemption was withdrawn during the said 4 years and in those circumstances the Supreme Court had held that the respondent before them had acquired a vested right and the said right could not be taken away during the subsistance of that period by a notification. Counsel had also placed reliance upon 1980 SCMR 607 where again it was reiterated by the Supreme Court that e right already accrued cannot be taken away by giving retrospective effect to a delegated legislation. In this case notification issued or 1‑7‑1959 which was prejudicial to the assessee was being sought to effect the right of the assessee which had already accrued when their accounting period had started from 1‑4‑1959 and in those circumstances the Supreme Court held that the right which had accrued from 1‑4‑1959 cannot be taken away by a notification issued on 1‑7‑1959. The counsel also relied upon C.P.1540 of 1980, case of Modern Textiles Mills Ltd. decided by a D. B. of this Court on 18‑3‑1982 where it was held that since the petitioner in that case had already completed all the formalities in respect of the import of cone‑winders before 29‑6‑1978 and they had been shipped also before that date, therefore, the notification issued on 29‑6‑1978 imposing duty on cone‑winders cannot be imposed as before that date they were exempted from duty. Here also the principle that vested right cannot be affected by subsequent delegated legislation was applied. Another case relied upon was 1985 S C M R 754 case of Nishat Mills Ltd. where again the same principle had been applied. Similar was the position in C . P . No .401 / 1980 the case of M . F . M . Y . Industry v. Pakistan decided by a D.B. of this Court. In yet another case of P L D 1978 Lah. 468(274) again it was held that the notification cannot be given a retrospective effect and in that case the Customs Authorities were not allowed to charge a duty which had come into effect after the petitioner had acquired a vested right in the import of the material at a particular rate of duty by opening L/C and getting the goods shipped before the duty was endorsed.

8. Mr. Liaquat Merchant had, on the other hand, placed reliance upon section 30 and section 80 and section 109 of the Customs Act and had further submitted that there was no vested right of any Mills on importing of goods at a particular duty because the same was a contingent right and not a consumated and matured right. He submitted that the Excise cases decided by different Courts could not be relied upon as in the case of 1970 S C 439, ' 4 years exemption from duty granted to an Industry was a complete right. It was being sought to be withdrawn by the Government by a notification during the subsistence of 4 years and hence a completed right was being interfered with and, therefore, Supreme Court had held that a vested right cannot be interfered with by a delegated legislation being given retrospective effect. The Deputy Attorney‑General relied upon P L D 1969 Dacca 704 (772), P L D 1964 Pesh. 178 where the vested right was described as completed or consumated right where nothing remained to be done to fix the right of enjoyment to the citizen. He also referred to P L D 1965 Pesh. 42(54) where vested right was explained as a fixed right of present or future enjoyment in contradistinction to expedient or contingent right. In P L D 1969 S C 599(616) 'vested' was explained as 'clothed', 'robed' and 'dressed', and 'vested rights' were described as essentially different from 'contingent rights'.

9. The Deputy Attorney‑General submitted that the case of the petitioner is covered by the provisions of section 109 of the Customs Act and since the Cement had been assessed under section 80, for the purposes of ware‑house, on 14‑9‑1982 and since on 10‑1‑1983 the duty in respect of cement was changed by a duly notified Gazette Notification, therefore, at the time of its clearance from the bond, namely, in March and February, 1983, the petitioner had to pay the duty which was prevalent in February, 1983 and the same was 40%.

10. Mr. Rashid Akhund had submitted that the case of the petitioner was covered by the decisions cited by him and, therefore, the enhanced duty could not be charged from the petitioner after 10‑1‑1983 because the petitioner had developed a vested right in getting the goods cleared when he had got them assessed at 25$ duty on 14‑9‑1982. His submission was that the Gazette Notification of 10‑1‑1983 being a delegated legislation could not be given retrospective effect to affect his vested right of getting goods cleared at the previous rate of duty. We do not agree with the submission of Mr. Rashid Akhund. The present case is fully covered under section 109 of the Customs Act which is reproduced hereunder: ‑ "If any goods have been entered for warehousing and assessed under section 80 but the duty leviable thereon is subsequently altered, such goods shall be re‑assessed on the basis of the altered duty and a new bond shall be executed by the owner in accordance with the provisions of section 86 to replace the bond originally executed by him." The meaning of section 109 is quite clear and it allows re‑‑assessment of the ware‑houses' goods on the basis of the altered duty which have been already assessed under section 80 on the basis of the previous duty. This is a statutory provision and has to be given effect. The intention of the legislature is clear that if a person wants to have goods' warehoused then he shall be liable to pay the altered duty as applicable at the time of the clearance of the goods.

11. It is admitted position that the rate of duty till 9‑1‑1983 was 25% on cement. Whatever the alleged vested right the petitioner can be having in respect of the clearance of cement at 25% duty was exercised by it when it had got the duty assessed @ 25% on 14th of September, 1982. There would have been no difficulty if the petitioner had not waited till 10th January, 1983 and if they had cleared the goods before 9th of January, 1983, then nobody could demand from them duty at 40%.

12. But it is again an admitted position that the duty was effectively changed by a legal notification on 10th January, 1983, and therefore, from this date the rate of duty chargeable in respect of cement for home consumption and for the purposes of clearance from bonded ware house was charged. The respondents are not giving any retrospective effect to their notification of 10‑1‑1983 when they are demanding duty from the petitioner at 40% on the clearance on their cement from bonded warehouse In fact, they have given only prospective effect to the notification which had been issued by Government on 10‑1‑1983. Since the notification had been issued on 10‑1‑1983 and the Customs Authority demanded enhanced duty in February, 1983, then it cannot be said) that they are giving retrospective effect to this notification.

13. The goods of the petitioner having arrived in Pakistan before 10‑1‑1983 and having been assessed and ware‑house before this date were actually assessed @ 25% duty and at that time the vested right, if any, of the petitioner concluded. But since the petitioner did not clear, the goods in September, 1982 but availed the facility of a bonded ware‑house and wanted to clear the goods on future date then obviously the petitioner's case is covered by section 109 of the Customs Act and hence the petitioners were rightly charged duty at 40% in February, 1983.

14. We have no hesitation in repelling the contention of the petitioner that its vested right, if any, continued even after the ware‑house of the goods. The provision of section 109 of the Customs Act are statutory provision and their effect is quite clear and the same have to be given effect as they intended. The emphasis of the petitioner that the notification of 10‑1‑1983 is being given a retrospective effect in February, 1983 is completely unfounded. The petition is, therefore, dismissed.

15. We have noted the citations of authorities from different counsel in respect of giving retrospective effect to notification and on the question of what is a vested right but we have not given our view on the question of vested right because we are clearly of the view no such question really arise in the case and the petitioner has been correctly dealt within accordance with the provision of section 109 of the Customs Act. This petition is, therefore, dismissed with costs. A.A. Petition dismissed.