P L D 1952 Lahore 430 (PLP)

KAYANI, J.‑In Regular Second Appeal No. 377 of 1951 the plaintiff Akbar Hussain is an opium contractor. In Regular Second Appeal No: 378 of 1951 the plaintiff is Akbar Khan, a liquor contractor. Both cases arose out of demand notes issued by the Excise Department for failure to pay the full amount of the license fees. The suits were filed for a perpetual injunction restraining the Government from execu ting the demand notes and although they failed in the first Court (the liquor case succeeded only partially) they succeed ed in appeal with the Senior Sub‑Judge. As common ques tions of law and fact arise in these cases it will be convenient to deal with them together. The normal feature of excise licenses is that they are valid for a period not exceeding a year and that they expire on the 31st of March. Consequent on the disturbances of 1947, however, the Excise Commissioner framed a‑ scheme with the approval of the Provincial Government for the issue of temporary special licenses on fixed fees for the sale of country liquor, opium and bhang and on the applications of the two plaintiffs such licenses were granted to them for a period of one month in the first instance and extended from month to month. Akbar Hussain was granted licenses for running seven opium shops within the area of the City of Lahore Corpora tion on a fixed fee basis, calculated, as the Excise Department alleges, at a fixed quota for each shop. He started in October 1947 and his licenses were extended from time to time up to the 31st of March 1948. The demand notes issued against him represented the outstanding arrears to the tune of Rs. 58,

954. Akbar Khan obtained licenses in October 1947 to run eight liquor shops within the same area and his licenses were extended from time to time until the 30th of September 1948. Two demand notes were issued against him, one for Rs. 82,000 and the other for Rs. 61,439‑8‑0, the total demand being Rs. 1,43,439‑8‑

0. In both cases the plaintiffs pleaded that they were not licensees liable to fixed fees and that they had been selling opium or liquor, as the case may be, as commission agents for the Government. There was a further contention that at the time when the alleged licenses were granted there was no duly appointed Excise Commissioner and that in any case he had no authority to frame a scheme for the issue of temporary licenses on fixed fees. The liquor licensee also pleaded (1) that he was not supplied from the Pindi Distillery the full quota of liquor sanctioned for the period up to the 31st of March 1948, and (2) that as after the introduction of prohibi tion the Government had taken possession of the plaintiff's liquor worth about Rs. 60,000 and had made it over to Messrs. Eduljee and Co. for sale, the amount in question should be deducted from the defendant's demand. In both cases the two lower Courts have held that the plaintiffs were licensees and that they were not acting as commission agents for Government. As regards the, powers of the Excise Commissioner, the learned Civil Judge who tried the liquor case was of the opinion that although these had been notified in 1949, long after the licenses became operative, they validated the appointment retrospectively. The opium case was heard by a different Judge who was of the opinion that the notification could not have retrospective effect, but that the licensee was estopped from questioning his authority by the rule of estoppel enunciated in section 115 of the Evidence Act. In the liquor case it was admitted on behalf of the Govern ment that liquor worth Rs. 60,000 belonging to the licensee had been made over to Messrs Eduljee & Co. subsequent to the introduction of the prohibition and, further, that there had been short supply from the distillery for which the licensee was enti tled to compensation. The quantity by which this supply was short however, was not indicated. The learned Civil judge, therefore, passed a perpetual injunction in favour of the liquor licensee to the effect that Government shall not enforce its demand notes without first accounting for the price of the liquor taken from the licensee's possession and determining the amount pf compensation due to the plaintiff for short supply for the period to the 31st of March 1948. It was further provided that if any dispute arose with respect to these amounts it should be determined during the execution proceedings. In the opium case the licensee's suit was dismissed. The appeals were heard in both cases by the same judge. He held that the notification of the appointment of the Excise Commissioner in 1949 could not operate retrospectively and that the rule of estoppel by representation could not be applied on those facts. He, therefore, accepted the appeals and awarded an injunction in each case that the Government was not entitled to issue the demand notes in question. In second appeal, the findings of fact also were contested on certain grounds. It is, therefore, necessary to go into the evidence in each case. If should be pointed out that the licenses alleged to have been issued to the two plaintiffs have not been produced and by the very nature of the allegations in these cases the plaintiffs should not be expected to produce them. The defendant, therefore, was left to resort either to secondary evidence or to other evidence indicating that the licenses were issued. I have examined the second volume of the Excise Manual with some care and find that there is no provision for a counterfoil of the licenses which might have been kept in the office of the Excise Department. There is, however, a register for licenses granted and a copy of it has been produced in both cases, (See Exh. D. 5 in the opium case and Exh. D. 14A in the liquor case.) These entries show that the two plaintiffs were respectively licensees of opium and liquor and the outstanding demand in each case is given against each one of them. The remaining evidence is as follows :‑ . Opium Case.‑Exh. D 1 is an application of the plaintiff dated the 1st September 1947 stating that he understood that licenses were to be issued on fixed fees and praying that such a license be granted to him. Exh. D. 4 is a letter from the Excise Commissioner to the Deputy Excise Commissioner conveying sanction to the grant of special temporary licenses for the sale of opium to Akbar Hussain, among others. Exh. D. 5 is a copy from the register of licenses in Form M. 2 of the Excise Manual showing the accounts of Akbar Hussain from September 1947 to March 1948. This register is intended for licenses granted on fees determined by auction or tender, but was made to serve the purpose of temporary license. Akbar Hussain is shown here as a licensed vendor. Exh. D. 7 to D. 14 are applications of Akbar Hussain dated the 15th October 1947 requesting for the increase of opium quotas for the eight shops allotted to him. In Exh. D. 8 it is expressly stated by him that he was prepared to deposit a license fee for the additional quota. Exh. D. 15 is an application by him dated the 20th October 1947 for extension of the term of the "licences". In one place he says "that I have timely paid all the one‑third license fee and also duly paid and paying the balance of two -third fee." The reference to the one‑third license fee is obviously to a condition contained in the Excise Commissioner's letter Exh. D. 4 requiring the licensee to deposit one‑third of the license fee in advance. Such a condition would clearly be inconsistent with sale on commission basis. Exh. D. 16 is an undated application by Akbar Hussain to the Excise and Taxation Officer, Lahore, stating that though sales in the first two months were satisfactory, they had gone down in the following months on account of the complete resettlement of refugees outside Lahore, the smuggling of contraband opium by Pathans on a large scale, the anti‑beggary campaign launched upon by the Government and the religious feelings in regard to the use of intoxicants : that he had drawn 637 seers of opium from the treasury, some at the fixed fee rates and some at the enhanced fee rates ; and requested that as he had served the Department at a time of grave emergency, accounts may be settled with him on the quantity drawn and consumed. This is a clear admission of the fact that he had been working as a licensee on fixed fee basis. It is unnecessary to refer to other documents on the subject, which show clearly that in official papers Akbar Hussain was treated as a licensee. There is also the evidence of Muhammad Hussain, Excise Inspector (D. W. 1) who recommended the grant of license to the plaintiff and who states that the conditions of the license were read out and explained to the plaintiff. The other witness, Fazal Ahmad (D. W. 2), an Excise Sub‑Inspector, stated that by checking the opium shops he had found that the licenses were in order. Liquor Case.‑Exh. D. 2 is an application dated the 30th of August 1947 by Akbar Khan and two others offering themselves as contractors for the sale of liquor in certain shops. Exh. D.1 is the statement of Akbar Khan dated the 3rd September 1947 recorded by the Assistant Excise and Taxation Officer regard ing his status. In this statement he is found to be requesting for a license on fixed fee. Exh. D. 11 is a letter of the Excise Commissioner dated the 5th September 1947 to the Deputy Excise Commissioner conveying sanction to the grant of special temporary liquor licenses in Form L 14‑A to Akbar Khan among others. Exh. D. 14‑A is a statement of the quota of country liquor awarded to the plaintiff between October 1947 31st March 1948 and the license fee due from him at the end of each month. Exh. D. 14 is a letter dated the 3rd February 1948 from the Excise and Taxation Commissioner extending the plaintiffs liquor licenses to the 31st March 1998. Exh. D. 15 is a letter dated the 8th April 1948 four the Excise and Taxation. Commissioner to the Excise and Taxation Officer, Lahore, sanctioning the grant of a license for the vend of country liquor to the plaintiff "on the license fee and quota noted against each for the period up to 30th June 1948." Exh. D. 3 to Exh. 10 are slips signed by the plaintiff on the 16th April 1948 as "license" in token of certain conditions having been read out and explained to him. Exh. D. 27 is an application dated the 13th February 1948 from the plaintiff to the Excise Department asking for priority with the North‑Western Railway for the despatch of 500 bags of empty bottles to the Murree Brewery Co. of Rawalpindi. This has been forwarded to the Divisional Traffic Officer, North‑Western Railway, for consideration and the forwarding note shows the plaintiff as retail and wholesale country liquor licensee. Exh. D. 31 is an undated application of the plaintiff to the Excise Commissioner stating that he was a country liquor licensee from September 1947 to 30th September 1948 and that on the latter date, by reason of the enforcement of prohibition against the consumption of liquor, 1396 bottles of liquor remained unsold with him, and requesting that these may be taken over by the Department and handed over to a foreign liquor licensee, perferably Messrs Eduljee & Co. If there would still be any doubt as to whether Akbar Khan was a licensee or a commission agent, it has been resolved by his own evidence. In Exh. P. 1, which is an application dated the 8th of February 1949, sent by him to the Collector from jail, to which he was committed in execution of the demand notes, he has brought the following matters to the Collector's notice :‑ (1) That the Excise Department had issued two demand notes against him, one for Rs. 82,000 and the other for Rs. 61,000. (2) That the demand for Rs. 82,000 was incorrect and that this fact had been admitted by the Excise and Taxation Officer himself, for the fee could be charged only on the liquor which had been supplied to him from the distillery and not on the quantity not supplied to him and that in this behalf he had made a representation to the Department which had not until then been decided. (3) That the Government had taken from him liquor worth Rs. 72,000 and given it to Messrs Eduljee & Co. for sale. Some of it had been sold and the price thereof credited to the petitioner's account. The rest of it also would be sold and its price credited similarly to the petitioner. It was, therefore, necessary that the demand notes should be amended. (4) That it was, therefore, prayed that an enquiry be made in respect of the correctness of the demand notes and of the facts state in this petition and that in the meantime the petitioner should be released from jail. Thus Akbau Khan admitted his liability except to the extent of short supply from Pindi and of the liquor which had been over by him to Messrs Edu1jee & Co. When, however, the application came to the Excise Department the Excise Inspec tor, Rao Suleman Khan (D. W. 1), made a typed report on its back which after stating that "Messrs Akbar Khan & Co. were granted temporary country license," added that the grant was on "commission basis." The report also said that "till the 31st March 1948 he could not draw and consume the entire sanctioned quota and failed to pay a license fee in the sum of Rs. 82,021‑10‑0". Other points stated in it do not interest us at present. This typed report is signed by Rao Suleman Khan and below is a forwarding note similarly typed, signed by Anwar Kamal Pasha, Excise and Taxation Officer, Lahore. There is no doubt that the typed note, purporting to be that of Rao Suleman Khan, and the forwarding note were done with the same type. Anwar Kamal Pasha was produced by the plaintiff as P. W.1 to prove the application Exh. P. 1. and the notes on the back and stated that it was correct that the plaintiff worked on commission basis. In cross‑examination, however, he admitted having asked the plaintiff as to why he was not depositing the "fees" and that the plaintiff had complained to him that this was because of the short supply of the liquor quota from Rawalpindi. The use of the word "fee" is ‑an unconscious admission of the nature of the demand, and it is significant that the complaint was not that he had been charged on a fixed fee basis contrary to the terms of his contract, but that he had been charged for the sale of liquor which had not even been supplied to him. Rao Suleman Khan, Excise Inspector, who is supposed to have drafted the main report, appeared as D. W. 1 and stated that the plaintiff was only a licensee and that conditions of the license had been explained to him. In cross‑examination he admitted having signed the report on the back of the plaintiff s application from the jail but stated that to his knowledge he had not made any such report. He explained that it was possible that the trying clerk may have obtained his signature without knowing what the note contained. He further explained that Anwar Kamal Pasha, the Excise Officer, was interested in the plaintiff, who is a Film Studio owner, particularly in a Film called "Mushahida", that Anwar Kamal Pasha had asked him also to make a report to the effect that the plaintiff had been selling liquor as a commission agent but that he had refused to make such a report. Considering that the note is a typed one and that the forwarding note of Anwar Kamal Pasha has also the appearance of having been typed out with the same type and perhaps at the same time, I am prepared to believe that Rao Suleman Khan signed the report without reading it. It is remarkable that while Akbar Khan himself did not in his application claim to be a commis sion agent, the Department or some particular black-sheep belonging thereto undertook to make out a case for him by a" simple innocent entry, contrary to the entire record of the Department. Having taken stock of the evidence in both cases it is now time to deal with the objections of Mr. Kaikaus to the admis sibility of his evidence. His first objection is that it has been admitted contrary to the provisions of section 91 of the Evidence Act. According to that section, when the "terms" of a contract or of a grant, or of any other disposition of property, have been reduced to the form of a document, and in all cases in which any "matter" is required by law to be reduced to the form of a document, no evidence shall be given in proof of the "term" of such contract, grant or other disposition of property or of such "matter," except the docu ment itself, or secondary evidence of its "contents" in cases in which secondary evidence is admissible under the Act. Mr. Kaikaus contended that licenses under the Excise and Opium Act were a "matter" required by law to be reduced to the form of a document and that consequently no evidence could be given of "such matter" except the document itself, or secondary evidence of its contents in certain cases. It is clear that the word "terms" has been used in relation to a contract, grant or other disposition of property and that the word "contents" has been used in relation to any other "matter" required by law to be reduced to the form of a document. What the section says is that if it is intended to prove the terms of a contract, etc., which happens to have been reduced to writing or to prove the contents of a document which the law requires to be in writing, the document itself should be produced or that secondary evidence may be given of its terms or contents, as the case may be, in cases where secondary evidence is admissible. The argument overlooks the fact that it is not the contents of the licenses are which intended to be proved in these cases, but the fact that the licenses were actually issued. Section 91 is, therefore, inappli cable. The consequent contention that there is no evidence under section 63 does not, therefore, arise. Section 63 states the meaning of secondary evidence and undoubtedly the evidence produced in this case for the defendant does not fall in any of the clauses mentioned in that section. The second objection was that Akbar Hussain had not been confronted with his admissions notwithstanding that section 145 of the Evidence Act requires that if it is intended to contradict the witness by his writing, his attention must before the writing is proved, be called to those parts of his statement which are to be used for the purpose of contradict ing him. This contention, however, is ill‑founded because when Akbar Hussain appeared as P. W. 3 he was confronted with Exhs. D. 8 to D. 16 and he admitted having signed them. Now Exhs. D. 8 to D. 14 are the applications for increase of the quota of the seven shops made by him as a licensee ; Exh. D. 15 is an application by him for extension of the licenses, in which he claims to have paid the advances of one- third in respect of previous licenses and Exh D. 16 is his application praying that accounts may be settled with him on the basis of the quantity drawn and consumed. It was con tended that his attention was not specifically drawn to such parts of these documents as were to be used for the purpose of contradicting him and that what he admitted was only that he had signed the documents. In the present context this is not a very forceful contention. The documents were intended to be proved as a whole for the purpose of showing that the plaintiff had made applications as a licensee and it is elementary that when you ask a person whether he has signed a document‑not as a witness‑the intention is to ascribe its authorship to him. Nevertheless, there is some merit in the language of section 145‑for it might be a lengthy document that is intended to be proved, and the witness might have some explanation for making a particular statement which he could furnish if confronted with that very statement and the f significance of which. might be lost on him if he is confronted with the document as a whole. Independently of these admissions, however, there is enough to show that Akbar Hussain was treated in official records as a licensee, and since official acts are presumed to have been regularly performed, it is for the plaintiff to show that the entry in the register of licenses was irregular. No reference was made by the learned counsel to the Admission in writing made by Akbar Khan but I take it that the objection applies to his case also. It is true that Akbar Khan was not confronted with any of his writings and while on this matter, I cannot fail to notice an almost casual co- relationship between the indifferent entrustment of Crown cases to indifferent lawyers (the emphasis being on indifference at both ends) and the increase of the volume of trivial work in this Court‑but Akbar Khan, like Akbar Hussain has been treated consistently in official papers as a licensee and has set the seal of approval on this treatment by his application from jail, Exh. P. 1, which his counsel took particular care to prove, and there is no doubt that after writing Exh. P. 1, it is not in good taste for him to say that he was not a licensee. I now proceed to a consideration of the question as to whether the Excise Commissioner was duly empowered to act as such and, if so, whether he had the further power of issuing temporary licenses. The Excise Commissioner in question is Agha Muhammad Yusaf. The original contention was that although during the period when these licenses were issued he was acting as Excise and Taxation Commissioner, his powers, through inadvertance, were not notified in the Gazette until March 1949. Subsequently other objections were also taken to the use of powers by him. Shortly before the Partition Agha Muhammad Yusaf was a Deputy Excise and Taxation Commissioner in Jullundur. By Notification No. 2007‑Excise and Taxation, dated the 24th September 1947, he was transferred from Jullundur to Lahore in the same capacity, but the transfer was shown to have been effective from the 7th of August 1947. The notification was based on an order of the Deputy Secretary, Development, dated the 5th August 1947. This means that Agha Muhammad Yusaf came to Lahore and functioned as Deputy Excise and Taxation Commissioner from the 7th of August 1947. On the 24th February 1949 a Notification No. 1251‑G. 49/21035 was issued showing that Agha Muhammad Yusaf had been appointed Excise and Taxation Commissioner on the 10th of August 1947 vice Mr. L. P. Addison. This means that in fact Agha Muhammad Yusaf had started working as Excise Commissioner from the 10th of August 1947. He, however, held the additional charge of the post of the Deputy Excise and Taxation Commissioner at the same time, because Notification. No. 26604 of the 29th March 1949 shows that right up to the 25th May 1948 he was both Excise and Taxa tion Commissioner and Deputy Excise and Taxation Commis sioner. After that date he was only Excise and Taxation Commissioner. On that date he was apparently relieved by Ch. Muhammad Afzal, who resumed the charge of Deputy Excise and Taxation Commissioner Lahore Circle, by Notifica tion No. 1360‑E & T, dated 7th May 1951. It is thus clear that between the 10th of August 1947 and the 25th of May 1948 Agha Muhammad Yusaf was exercising the powers both of the Excise Commissioner and the Deputy Excise and Taxation Commissioner. It is true that the powers of the Excise Commissioner were notified in 1949 and that section 9 of the Excise Act requires that "the local Govern ment may by notification appoint an Excise Commissioner". But the provision as to notification is not imperative and there is nothing to show that if the appointment is not notified in the Gazette it will have any disastrous effect on his powers. The object of the notification is to make it convenient for the public to know whom they are dealing with for the purpose of licenses for opium and liquor. All that is necessary is that some officer who has been empowered by the Government to function is actually functioning. The learned Senior Sub‑Judge (and the learned counsel for the plaintiffs in this Court) has relied on Nawab dam, etc. v. Emperor A. I. R. (30) 1943 Sind 39 for the proposition that in matters of criminal law, retrospective effect can be given only by an Act of the Legislature and has extended the analogy to matters of civil law. That was in fact a case on which the learned counsel should not have relied. The facts were that the district of Nawab Shah, which was created in 1912, was included in the Hyderabad sessions division with a Sessions judge at Hyderabad and an Additional Sessions judge working at Nawab Shah. In 1921 it was decided to make Nawab Shah an independent sessions division and the creation of the post of District and Sessions Judge was also sanctioned at the same time. Owing to financial difficulties, however, the scheme remained suspended until 1942 in which year, on the 2nd June, a resolution of the Government of Sind reviving the post of the District and Sessions Judge, Nawab Shah, "which had been held in abeyance" was published and on the following day a notification appointing a certain officer as District and Sessions Judge of Nawab Shah was issued. There was no separate notification, however, about the creation of Nawab Shah as an independent sessions division, though on the 14th of October 1942 a notification was issued to operate in retrospect. It was contended in respect of a trial held four months after the Sessions Judge had exercised powers that in the absence of a formal notification powers had been exercised without juris diction. It was held by a Full Bench, repelling this contention, that the notification of 14th October 1942 was unnecessary and that the entire history of the case pointed to the inference that a Sessions Division had been created. As regards the effect of a notification, it was observed: "After all, there is no particular virtue in a formal notifi cation. The notification does not confer the powers. Section 9, Criminal Procedure Code, confers the necessary powers, so does section 7. ‑ A Government notification merely declares or records the acts of Government. The powers themselves are conferred by and exercised under the sections. Neither section 7 nor section 9 of the Code requires formal publication in the Government Gazette. Whether a Court of Session is established is a question of fact. Whether the limits of a sessions division or district are altered is a question of fact." As regards the notification of 14th October 1942 it was pointed out by Davis, C. J.:‑‑ "So far as it purports to give retrospective effect to the orders therein contained, I think this direction both super fluous and of no effect. In matters of criminal law, such as this, retrospective effect can be given only by a validating Act, and not by the executive orders of Government." That is quite obvious. Thus Government cannot by notification validate a conviction made without lawful powers. If, however, the powers are given although not notified, there is nothing wrong in the exercise thereof. The language or section 9 of the Excise Act is no more than directory. It merely says that an Excise Commissioner may be appointed by notification. It does not say that the appointment would be invalid in the absence of a notification. While arguing that Agha Muhammad Yusaf could not issue the licenses because his appointment had not been pro perly notified, learned counsel discovered that the licenses had to be issued by the Collector (see Order 21'42 of the Opium Orders and section 35 of the Excise Act) and attacked the validity of their issue on that ground, This argument, however, ignores the existence of two notifications issued on the 19th of October 1946 (No. 1813‑E. & T. and No. 1814‑E. & T.) by which all Deputy Excise and Taxation Commissioners were appointed Collectors in exercise of powers conferred by sec tion 3, subsection (3) of the Excise Act and rule 21.1 (f ) of Punjab Opium Orders. I have already shown that Agha Muhammad Yusuf held the additional charge of the Deputy Excise and Taxation Commissioner until the 25th of May 1948, when he was relieved by Ch. Muhammad Afzal, and it may well be regarded as a formal defect in the proceedings that Agha Muhammad Yusaf was not shown in his capacity as Deputy Excise and Taxation Commissioner while sanctioning these licenses. Next it was argued that temporary licenses on fixed fee basis could be issued only by the Financial Commissioner and not by the Excise Commissioner or the Government. It will be seen that the Excise Commissioner before issuing these licenses obtained the sanction of the Governor. (See Exh. D. 26 in the liquor case of which a copy has been placed on the file of the opium case also.) This is a letter from the Deputy Secretary, Development to the Excise Commissioner, dated the 25th September 1947, and although it purports to be from the Governor, it must not be overlooked that the Deputy Secretary, Development, in fact issues orders on behalf of the Financial Commissioner, Development, who is in charge of Excise. Immediately after the Partition, offices were in the hands of inexperienced officials who were not conversant with formalities and it was apparently believed that the Financial Commissioner when issuing orders did so as the mouthpiece of the Government. But apart from this consider ation, if the order was actually issued by the Excise Commis sioner, its validity is not affected by the circumstance that the Financial Commissioner or the Government were consulted before its issue. It may happen, not infrequently, that when making an experiment, an officer who is himself empowered to issue an order, should do so after consultation with his superior and this is what appears to have happened in the present case. So far as the Excise Act goes, the powers of the Financial Commissioner were delegated to the Excise Commissioner in 1946 for all relevant purposes. See Order 3.13 (A) in the Second Volume of the Punjab Excise Manual. So far as the Opium Act goes, the delegation had been made earlier by Punjab Government Notification No. 7142‑Excise, dated the 15th December 1945; when throughout the Opium Orders the words "Financial Commissioner," were substituted by Excise. Commissioner (See Correction Slip No. 192, dated the 9th of December 1946 affixed to Chapter 21 of the Second Volume of Punjab Excise Manual.) "That the Financial Commissioner had power to grant licenses on payment of a fixed free, was not denied and cannot be denied. Under rule 5'27 of the Punjab Liquor License Rules, licenses in Form 1‑14‑A for the retail vend of country spirit are normally granted on fee fixed by auction, but the Financial Commissioner has reserved the right to grant any such licenses on payment of a fixed fee. As regards the retail vend of opium, Order 21'42 of the Punjab Opium Orders states in clause (4) :‑ "For the purpose of fixing the fee payable for any retail license, or for all or any of such licenses to be held within the limits of, any one district, or part of a district, the Collector may either direct that such retail license or licenses be put up for sale by public auction or call for tenders for such license or licenses as he may think fit." And it would appear prima facie that there are only two recog nised methods granting retail licenses, one by auction and the other by inviting tenders. The language of the clause, how ever, does not exclude the grant by any third method. The object of clause (4) would appear to be to enable the Collector to get an idea of the demand in the market. In putting the license to public auction or in calling for tenders he adopts a method which is less profitable for the licensee and more profitable for the Government. In view of the special condi tions then prevailing it was apparently intended to encourage the licensees by eliminating competition. The object of the clause is clearly stated in the opening words "for the purpose of fixing the fee payable for any retail license" so that if the Collector has no doubt as to how lie should fix the fees, he may fix them without resorting to auction or tenders, in which case he could not be said to have exceeded his powers. It was also argued that the licenses could not be granted for any period shorter than a year. Under Order 4'2 of the Punjab Intoxicants License and Sale Orders a license "may only be given for a period of one year from the 1st of April to the 31st of March, provided‑ (a) a license may be given from any date to the 31st March following ; (b) the Financial Government may sanction shorter periods for such licenses or classes of licenses as he thinks fit." Now in the first place what the Order means is that the maximum term of a license shall not exceed a year. That it may be given for shorter periods is clear from the fact that it can be given at any time of the year provided that it termi nates on the 31st March following. Secondly the Financial Commissioner has power to sanction shorter periods. So much for liquor licenses. For opium licenses Order 21'42 of the Opium Orders states in clause (3) that retail licenses may be granted for a period of one year only and that each license shall cease to operate and determine on the expiry of the financial year in which it was .granted. Here also it is clear that only the maximum period is prescribed and again the financial Commissioner has power under Order 21'40 to impose fresh conditions consistent with the terms of the agree ment and of the Opium Orders. It cannot be said that the language of Order 21'42, clause (3) would be violated if the Financial Commissioner orders the grant for a shorter period. This seems enough to dispose of the points of law, but the learned Government Advocate having also raised questions as to the jurisdiction of the Civil Court it would be proper to examine them in some detail. He first referred to section 42 of the Excise Act which maybe reproduced here for ready reference. Section 42, subsection (1)

`No license, permit or pass granted under this Act shall be deemed to be invalid by reason merely of any technical defect, irregularity or omission in the license or in any proceedings taken prior to the grant thereof. (2) A decision of the Financial Commissioner as to what is a technical defect "irregularity or omission shall be final." He argued that the defects which. had been pointed out by the learned counsel for the plaintiffs were either technical defects or irregularities and that if a question arose whether or not they fell into that class, the decision rested with the Financial Commissioner. That seems to be the sense of section 42, but a prerequisite to the application of that section is that the license is one "granted under this Act," which means that it should have been granted under powers con ferred by this Act. It those powers have been exceeded the license would not be under this Act. If, for instance, the Financial Commissioner had no power to give a license on fixed fee or for any period short of a year, it could not be said that the defect was technical, in which case it would be futile to resort to sub‑section (2). It could of course always be argued, whenever a question of the validity of the license arose, that the so called invalidity is merely a technical defect and that consequently the matter should be decided by the Financial Commissioner. The correct interpretation of the section, however, would seem to be that in the first place it should be found that the licenses were granted under the Act and when that has been shown to be the case, any further f irregularity in the license should be a matter for the Financial Commissioner to decide. In similar circumstances, where the question was whether a certain order had been made "in exercise of powers conferred by the Act," the Privy Council observed in Emperor v. Vimla Devi 1946 P C 123 that "if the orders made by the Police or the Government were invalid, they were not made in exercise of a power conferred by the Act." An almost identical provision in respect of opium licenses is contained in Order of 21'66 of the opium orders. These orders were made by the Provincial Government in exercise of powers conferred by section 5 of the Opium Act. The section provides that Government may make rules "to regulate ........... ...... ; all or any of the following matters :‑ (a) the possession of opium ; (b)

; (c)

; (d) the sale of the opium, and the form of duties leviable on the sale of opium by retail." Now although rules may be made to regulate the sale of opium, and as such sales are to be regulated by licenses, rules may also be made as to the form of licenses and the conditions governing them, it is certainly beyond the power conferred by the Act to make a rule excluding the jurisdiction of a civil Court to decide whether a certain license is in accordance with the Act. If, therefore, Order 21'66 was intended to exclude any jurisdiction, it is to that extent ultra vires of section 5 of the Act. ' The next argument of the learned counsel for the Crown was that since the demand made against the plaintiffs was to be realized as an arrear of land revenue it fell within section 158, subsection (2) clause 14 of the Land Revenue Act and was a matter excluded from the jurisdiction of the Civil Court. The argument is of no avail so far as the demand under the Excise Act goes. Under section EO of the Excise Act all excise revenue and all amounts due to the Crown by any person on account of any contract relating to the excise revenue may be recovered "by distress and sale of his movable property, or by any other process for the recovery of arrears of land revenue due from land‑holders or from farmers of land or their sureties." The demand is, therefore, not to be treated as an arrear of land revenue. The only kinship it has with such arrears is that it may be recovered by the use of any process which is used for the recovery of arrears of land revenue. One of the methods employed in the recovery of arrears of land revenue, namely, the distress and sale of movable property, is stated in the section and for the sake of convenience reference has been generally made to the other modes of such recovery, but it does not mean that because the same methods are employed for the realization of both demands, incidents attached to one of those demands are necessarily the incidents attached to the other demand. Section 23 of the Opium Act, however, clearly states that: "Any arrear of any fee or duty imposed under this Act or any rule made hereunder

may be recovered from the person primarily liable to pay the same to the Provincial Government or from his surety (if any)." "as if it were an arrear of land revenue." Under section 158 subsection (2) of the Land Revenue Act ; "a Civil Court shall not exercise jurisdiction over any of the following matters namely‑ (xiv) any claim connected with, or arising out of the collection by the Government, or the enforcement by the Government of any process for the recovery of land‑revenue or any sum recoverable as an arrear of land‑revenue." This clause seems to cover :‑

1. Any claim connected with or arising out of the collec tion of land‑revenue by the Government ;

2. Any claim connected with or arising out of the enforcement by the Government of any process for the recovery of land‑revenue ; and further provides that,

3. A sum recoverable as an arrear of land‑revenue would be treated on the same footing as land‑revenue. Mr. Kaikaus argued that this clause included only the claims of third parties against whose property a process for the recovery of land‑revenue might be issued under an erroneous mistake of fact that it belonged to the defaulter, and pointed out that if clause (xiv) had been intended to cover the liability to assessment, there would not have existed for the same purposes a separate provision in clause (viii), and since there is no reference in clause (viii) to any demands recoverable as arrears of land‑revenue, it was apparently not intended to apply these provisions to such demands. Clause (viii) relates to "the claim of any person liable for an assessment of land revenue or of any other revenue assessed under this Act." It is obvious, however, that liability to the assessment of land‑revenue cannot be conveniently classed together with liability to any other demand for which any special law may have provided a mode of recovery as an arrear of land revenue, for if liability to assessment is established, liability to pay arrears follows as a matter of course. But so far as the argument of Mr. Kaikaus goes, it does not meet the first part of clause (xiv) which relates to "any claim connected with or arising out of the collection by the Government" of a sum recoverable as an arrear of land‑revenue. There is no divergent opinion on this point. In Mst. Rukman Devi v. Sasn Das 73 P L R 1912 the plaintiffs sued the defen dant, both being proprietors in the village, for certain sums of money which they asserted to have been recovered by Government from them as land‑revenue, whereas in fact these sums were payable not by them but by the defendant. It was observed by Chevis J., that section 158 (2) (xiv) of the Land Revenue Act "certainly seems to apply, for it seems to me clear that the present claim is one arising out of the collection by the Government of land‑revenue." In Shafi Muhammad v. Jahangir A I R 1934 Lah. 157 (2) a suit had been brought by a village Lambardar for the recovery of a certain sum which had been paid by him to Government as land‑revenue on behalf of a defaulting proprietor. Bhide J., held. that clause (xiv) of section 158 applied and that the suit was excluded from the jurisdiction of the Civil Court. The language used in clause (xiv) is more or less identical with the language used in the 6th clause of section 65 of the Land Revenue Act of 1871 and the meaning of the words employed in them has been brought out very clearly in Devi Singh v. Kali Ram (27 Punjab Record 1876). In that case a claim had been brought by a lambardar for puchotra against the proprietors' who instead of paying the land revenue through him had paid it direct to the Government assignee, Boulnois J. observed. "It is clear that what those words mean is that civil suits are not to be brought by persons alleging themselves to be aggrieved in the collection of the land‑revenue by those who have to collect it" and Campbell J. agreeing said, "We must look at the general tenor of the Act and look ing at that it is clear that what is meant is that Civil Courts shall not hear suits in which the action of the Revenue authorities in the matter of the amount of revenue to be collected or the mode of collection is at issue. It is true that taking the broad construction of the words many other suits have their indirect origin from the procedure of the Revenue authorities, but in the sentence quoted the word 'collection' merely means the actual action taken by the Collector to recover the land revenue due to the State." The claim of the lambardar, however, was held not to arise from the action of the collection of the Government demand and the suit was, therefore, held to be cognizable by a Civil Court. In Kahal Shah v. Barkat Khan (54 Punjab Record 1885) another Division Bench followed this ruling in a case where the plaintiffs had sued to recover from the defendant money which, they alleged, he had improperly collected from them on accounts of the land‑revenue due for land held by him. It was held that the suit was cognizable by a Civil Court because it. "does not relate to the action taken by the revenue authorities for the recovery of arrears of land revenue, but to a sum alleged to have been collected by the defendant from the plaintiffs." In this view of the case, if the collection is by Government the Civil Courts are excluded, but not so if the collection is not by Government. I would, therefore, hold that in respect of the demand in, opium case the suit was not competent in the Civil Court. There now remains the question of estoppel, and although it, is not often a. doctrine which can be unhesitatingly applied to a certain set of facts, in this particular case its application should present no difficulty Neither opium nor liquor can be sold without a license, and both the plaintiffs having accepted the position that they were licensees, having dealt with the Excise Department in that capacity and having received a benefit on that account, they should not be allowed to chal lenge the authority of the licensor to grant a licence. Sec tion 117 of the Evidence Act is directly involved, for it says "Nor shall any bailee of licensee be permitted to deny that his bailee or licensor had, at the time when the bailment or license commenced, authority to make such bailment or grant such license Mr. Kaikaus argued that perhaps "license" in this section referred to a license to use land, which was equivalent to an inferior sort of lease or tenancy. This, however, could not be correct, because licenses of that kind are the subject matter of section 116, which, in addition to debarring a tenant: of immovable property from denying his landlord's title, estops also a "person who came upon any immovable property by the license of the person in possession thereof." Section 117, therefore, should be deemed to apply to other classes of licenses, I not relating to immovable property. That it applies to licenses from the owner of a patent and the licensee of a trade‑mark is clear from the cases cited in Monir's Commentary. I do not see why it should not apply to other licensees, such as those of liquor and opium, the principle being that a person who could not do a certain thing except with the authority of another should not be heard to say, after he has done the thing and profited thereby, that his licensor himself had no authority ; particularly so in the present case, when the license is granted on behalf of the Government by an officer appointed in that behalf and the question only is whether at any material time that officer was possessed of formal investiture. But the law of estoppel goes beyond the limits of a license. Estoppel in pais, or equitable estoppel, has been said to arise firstly from agreement or contract ; secondly, independently of contract, from an act or conduct of misrepresentation which had induced a change of position in accordance with the real or apparent intention of the party against whom the estoppel is alleged. (Woodruff s Law of Evidence) Section 115 deals with the second kind, while sections 116 and 117 afford examples of the first, of estoppel by agreement, but they are not exhaustive. At least that is what we have been hearing) for along time, and on good authority. Thus in Rup Chand Sarbessar Chandra Chunder 10 C W N 747 (1906) it was said that "there are some transactions which are so obviously based on a conventional state of facts that for that very reason the parties never in practice come to an express agreement about them at all and the estoppel is but the carrying out of what the parties as honest men must have intended if they thought about the matter at the time they made their bargain." It was) also observed in the same case that the question of the existence of such an estoppel must be dealt with on broad grounds of legal principle and that the question in each case should be‑is there an agreement on which an estoppel should be justly founded? Or, as Lord Coke said : "It is called an estoppel or con clusion because a man's own act or acceptance stopped or closeth up his mouth to allege or plead the truth." And there was not much of truth here on the plaintiffs' side. The only truth there was rested on the doubtful ground that Agha Muhammad Yusaf's powers had not been notified, although in very truth he was acting as Excise Commissioner. Then there is a class of cases where a benefit having been received by a person under an invalid deed or contract, he has not been allowed to deny execution or to repudiate the con tract. See the Exchange Bank of Yarmouth v. Blethen (10 A C 293) ; Great Western Railway Co. v. Midland Railway Co. (1908) (2 Ch. 644) and District Board Kistra v. Lakshmayva (1937 M W N 1223). The generality and benevolence of these rules is not denied, but it is contended that there is no estoppel against statute. That, again, is a widely accepted rule, though the limits of its acceptance have varied with the facts of each case. One plain case would arise when the plea of estoppel would defeat the plain provisions of a statute, as in the case of docu ments requiring compulsory registration, and here the conse quences of non‑registration are stated. Again, no estoppel can be pleaded against the directions and prohibitions of statute law, and against the rights accruing to any party by reason of such directions and prohibitions. Thus where an agriculturist's residential house has been rendered by law immune from attachment and sale, the execution of an agreement by him foregoing that right in the event of attachment in execution of a money decree does not estop him from raising an objection. As the Privy Council said in another context Maritime Electric Co. v. General Dairies, 1937 P C 114, a party cannot by representation, any more than by any other means raise against himself an estoppel so as to create a state of affairs which he is under a legal disability of creating. Then there are statutes intended for the public benefit, grounded on public policy, such as an Act requiring an electric company not to charge above a certain maximum or below a certain minimum figure for the energy supplied, of which the Mari time Electric Company's case provides an example. The company had by mistake charged a lesser rate from a certain dairy which employed the energy in the manufacture of milk products and which had in consequence charged a proportion ately less amount from its own customers. In an action for the recovery of the balance due according to the law the dairy pleaded estoppel. Repelling this contention, their Lordships observed : "In case of a statute enacted for the benefit of a section of the public, that is, on grounds of public policy, where the statute imposes a duty of a positive kind, not avoid able by the performance of a formality, for the doing of the very act which the party suing seeks to do, it is not open to the party to set up an estoppel to prevent it." Another example of this kind will he found in Fairtitle v. Gilbert (2 T. E. 169) (1887), where the trustees under a Turnpike Act, although empowered to mortgage only the tolls, had mortgaged both the tolls and toll‑houses. This had the effect of placing at a disadvantage other mortgages of tolls, for the Act also provided that there shall be no priority amongst the several mortgages, irrespective of the date of mortgage. Ashhurst J. observed that although in general the party granting the mortgage is estopped to say that the mortgagee had no interest, that general principle did not apply here as the trustees acted for the benefit of the public, and it would be hard if other creditors, who were not parties to this deed, should lose the benefit given to them by the Act. Besides, there was a still further reason : this was a public Act of Parliament and the Court was bound to take notice that the trustees had no power to mortgage the toll‑houses. Then it is to be observed that in some instances the law is imperative while in others it is merely directory, and " with regard to the doctrine of ultra vires, this, it appears, is not as a rule allowed to beset up in contradiction to the general rules of equity, except when the enactment is very precise and prohibitory, and not merely directory and the enactment will be construed very strictly against the party who attempts to set it up". (Everest and Strode on the Law of Estoppel, third edition page (176). The Barrow Mutual Insurance Co. v. Ashbuner (54 L J Q B 377) is a typical example of this interpretation. In that case, a member of a mutual insurance company had vessels on the books of the company as insured and paid calls regularly and otherwise acted as a member. A policy was issued to him for each vessel in the first instance, and the practice was, after the expiration of the first time policy, to issue no new policy in writing, but to give stamped receipts for calls. This was in violation of the relevant Insurance Act which required by section 7 that " no contract for sea insurance shall be valid unless the same is expressed in a policy, and every policy shall specify the particular risk pr adventure, the names of the subscribers or underwriters, and the sum or sums insured and in case any of the above mentioned particulars shall be omitted in any policy, such policy shall be null and void to all intents and purposes." Section 9 provided that no policy shall be pleaded or given in evidence unless duly stamped, but subsequent stamping was permitted on payment of a penalty. Section 13 imposed penalty of 100 on any person becoming an insurer unless the insurance was in writing and duly stamped. The action arose out of the member's refusal to pay three calls which were made to meet actual losses which had happened to vessels whose owners had paid the usual entrance fee and who had made proposals which were duly accepted, but; as in the case of this particular member, no policy had been issued for any of these vessels. It was argued for him that the sums which he was asked to contribute were paid on contracts prohibited by the statute Brett, M. R. ex pressed himself strongly when he said : "I must . . . express my absolute abhorrence of the defence, which is a mean and disgraceful attempt to back out of a liability, but which I am happy to say is wholly unsuccessful . . . . . The new society was formed and registered, and the defendant assumed to be a member of it on the terms that ships were to be insured against losses and if his ship were lost, the others should pay him, but if the ship of one of the others were lost, he and the rest should pay him . . . . He acted as if the other persons had validly insured their ships. : . The other members entered into the insurance in the faith that he would pay, but he misled both those who paid calls and those who received for losses, as well as the society representing the members. In such a condition of things he is estopped from saying that the calls were improperly made or losses impro perly paid. If the estoppel set up was against a criminal or prohibited contract, there would be no estoppel." Further, "when the Legislature requires a writing and a stamp it imposes an obligation to do something which there is no obligation to do at common law. The consequences of not doing it are a novelty invented by the Legislature. In the same statute in which the obligation is imposed, the consequences of disobe dience are enacted. I am of the opinion that under those circumstances the only consequences are those expressly enacted." Bowen L. C. put it shortly in these words. "In regard to the interpretation of the Acts, I think it is not that the contract is prohibited, but that a penalty is attached to making 'it in a certain way." In short, the rule that there is no estoppel against statute prevails only if the contract is in clear terms forbidden by it, and to decide whether that was the intention of the Act, its language should be construed strictly and on the side of enquiry. In Prem Parkash v. Mohan Lal A I R 1943 Lah. 266, a Full Bench of this Court decided that a school‑master who had agreed to the attachment of his salary and provident fund was not estopped from pleading that these were not attach able under the proviso to section 60 Criminal P. C. because such an agreement was in express contravention of the proviso which states that " the following particulars shall not be liable to such attachment or sale." But the following sentence in the judgment is eloquent : "This view is, however, based on the supposition that the prohibitions contained in the proviso to section 60, Criminal P. C., are mandatory and not merely directory, and that in any case the exemptions contained in the proviso were made on grounds of public policy." Now what is there in the Excise and Opium Acts that conveys such an absolute mandate from the Legislature as a Court of law must carry out to the exclusion of common justice between contracting parties? Can an intention be ascribed to those Acts to render unlawful all acts of the Excise Commissioner if his appointment does not appear in the Gazette, although in actual fact he was appointed by Government and acted as such? Can it be said that the issue of short‑term licenses on fixed fees were foreign to the intention of the Legislature and were absolutely forbidden? Confining ourselves strictly to the language of the Acts, we should find that they merely require certain formalities to be observed in the grant of licenses but that they do riot forbid the grant of licenses. It is in the very essence of those Acts to grant them, and they are so anxious to find a suitable person for such grants that they expressly declare the licenses immune from invalidity by reason of any technical defect, irregularity or omission, whether in themselves or in the proceedings relating thereto. And in order that they should not take chances, they ask us to refer all such matters to the Financial Commissioner, the head of the Excise Department. It is further to be observed that there is nowhere in these Acts a single word to indicate the consequences of ‑an illegality or irregularity committed in the grant of licenses, or of carry ing on the business of a licensee ‑obtaining opium from the treasury and liquor from the distillery‑with the open approval of the department although without a regular license. In these circumstances, it should be held that the plaintiffs had entered into an agreement which was not forbidden by the Acts, that they acted as though they had been licensees and that having accepted the contracts and thus made it impossible for the department to look for other licensees, they were estopped from questioning the authority of the Excise Com missioner to grant them. The appeals are consequently accepted. The suit of the opium contractor, Akbar Husain, is dismissed with costs throughout. The liquor contractor, Akbar Khan, however, had a good reason to be aggrieved against the demand notes, embracing as they did the price of the liquor‑‑about sixty thousand rupees‑transferred from him to Messrs Eduljee & Co., and failing as they did to account for short supply made by the Rawalpindi brewery. This demand should be revised. In this respect the order of the trial Court is restored, and there will be no order as to costs. Perhaps it may be possible for the Excise Commissioner to pay more attention than has hitherto been paid to the re presentation of the licensees that they have suffered by reason of unsettled conditions or other circumstances and I think that, legal rights apart, they might have a good case for partial remission, if presented afresh. A. H. Appeals accepted.