1984 PLP 2694 (CLC)

‑‑‑S.55(a)‑Constitution of Pakistan (1973), Art.199‑‑‑Demand Notice for payment of certain amount issued to petitioner by Excise and Taxation Officer‑‑Amount thus payable/demanded not determined/established in any judicial proceedings‑‑Demand, held, without lawful authority‑‑Provisional Constitution Order (1 of 1981), Art.9 Ashfaq‑ur Ratman v. Chaudhri Muhammad Afzal P L D 1968 S C 230; Sind Industrial Trading Estate Ltd.,Karachi v. Central Board of Revenue and 3 others P L D 1975 Kar. 129; Appaya v. Collector I L R 4 Mad. 155; The Secretary of the State v. Municipal Committee of Karachi A I R 1931 Sind 55 and Messrs Pakistan Pipe & Construction Co. Ltd. v. City Mukhtiarkar, Karachi East Deputy Commissioner's Office, Karachi and another P L D 1984 Kar. 28 ref. Naimuddin, J.‑‑ By this constitution petition under Article 199 of the Constitution of the Islamic Republic of Pakistan, 1973, filed in 1978, the petitioner has challenged the demand for payment of Rs.6,17,900 made by the Excise & Taxation Officer (Execise)/Administration, Civil Lines, Karachi by a notice dated Ist February,1978,,as being without lawful authority in the following circumstances.

2. The petitioner is the proprietor of Messrs Unique Traders, having an office at 88‑K, Block 6, P.E.C.H. Society, Karachi. In the year 1974, the petitioner obtained a licence for import and export of spirit and liquor. He however, received a charge sheet No.10/5/72, Excise 1982, dated 23rd October,1976, issued by the Director Excise & Taxation, Karachi, respondent No.2, wherein it was alleged that the petitioner had imported spirit in the quantity of 3,200 bulk gallons under bogus permits it collusion with the Central Excise Officer. It may be convenient if the charge‑sheet is reproduced here in below. It reads as follows:‑‑ "The Excise Staff of West Division‑II, Excise Wing detected‑18 Drums (Eighteen Drums), containing 720 B, Gallons of Rectified .Spirit from the house situated in Kashmir Colony, Karachi on the night between 27th and 28th November, 1975. A case under section 43(3), Abkari Act, 1878 was registered vide FIR No.43/75, dated 20th November,1975. During the course of investigation F.C.Sardar Ali of Matmoodabad Police Station, Mr.Moosa Rajput, Excise & Taxation Sub‑Inspector and Raisuddin, Junior Clerk of Veno Fee Office (Excise & Taxation Department) were arrested. Investigation revealed the said rectified spirit was imported by you from Messrs Crescent Sugar Mill and Distillery Ltd., Lyallpur. Under bogus Permit No.109 dated 19th April, 1976 and No. 31 dated 19th September, 1976 under the above permits 3,200 bulk gallons of Rectified spirit were imported in two consign ments you got these permits fraudulently with the help of accused Mohammad Moosa Rajput and Raisuddin, Junior Clerk of the E & T Department. In this way you have evaded a huge amount of Excise duty also. Thus you have not only contravened the licence conditions of the Ordinary Trade and Import Licence granted to you but rendered yourself liable to prosecution far illegal import of 3,200 bulk gallons of rectified spirit under section 43(3) of Sind Abkari Act, 1878. You are therefore, called upon to show cause within fifteen days of the receipt of this charge‑sheet as to why the ordinary Trade and Import Licence granted to you should not be cancelled besides your prosecution in the Court of law. Please also state whether you wish to be heard in person."

3. The petitioner submitted a reply to the charge‑sheet. However, by the order dated 5th January,1977, respondent No.2, cancelled the licence of the petitioner. The order reads as follows: "I have gone through the reply of charge‑sheet submitted by Messrs Unique Traders, Karachi, which is not found satisfactory. From the perusal of the case papers it would be in the fitness of things that the licence of Trade and Import granted cancelled. I, Jamil Ahmed K. Siddiqui, Collector/Director of Excise, Karachi hereby order to cancel the ordinary Trade 8 Import Licence No.26/76 granted in favour of Messrs Unique Traders, Karachi, with immediate effect. As the licence is cancelled as punishment and the case is therefore, finally disposed of under section 55 (a) of Sind Abkari Act, 1978 against Messrs Unique Traders only." Thereafter, the notice impugned in this petition was issued.

4. We have heard Mr.Nasim Faruqui learned counsel for the petitioner and Mr.M.I.Memon learned Additional Advocate‑General, Sind for the respondents.

5. The learned counsel for the petitioner submitted that the demand made by respondent No.3 by the impugned notice is without lawful authority inasmuch as the amount claimed has not been determined in any judicial proceedings and is even otherwise not an admitted amount and in support submission he had relied on Ashfaq‑ur Rahman v. Chaudhri Muhammad Afzal L D 1968 S C 230; Sind Industrial Trading Estate Ltd. Karachi v. Central Board of Revenue and 3 others P L D 1975 Kar.129, Appaya v. Collector I L R 4 Mad. 155, The Secretary of the State v. Municipal Committee of Karachi, A I R 1931 Sind 55 and Messrs Pakistan Pipe & Construction Co. Ltd. v. City Mukhtiarkar, Karachi East Deputy Commissioner's Office, Karachi and another P L D 1984 Kar. 28 which support the contention of the learned Counsel.

6. The learned Additional Advocate‑General, Sind submitted that since the petitioner's licence was cancelled on the ground of illegal import of 3,200 bulk gallons of spirit, the damand made is justified. He however, conceded that the liability ox the petitioner to pay the amount of demand by the respondents has not been determined in any proceedings. However, he has not relied on any law in support of the demand. Moreover, we fine that by the order dated 6th Novemoer,1977, the Collector/Director Excise & Taxation (Excise), respondent No.2, had cancelled the licence as a punishment and the case was finally disposed of. No fine or penalty was imposed thereunder. Mr.Memon however, referred to the letter dated 2nd February,1978, written by the petitioner to the Director Excise & Taxation and submitted that by this letter the petitioner undertook to pay the amount but a perusal of it does not support the claim of Mr.Memon. In this letter the petitioner denied his involvement in case and requested for time to consult his legal adviser to give proper reply. We may here reproduce the contents of the letter in extenso for the sake of ready reference. "To The Director, Excise and Taxation (Excise), Karachi. Sir, The undersigned has been served a notice bearing No.Excise/ C‑L/Admn/78, dated 1st February,1978, to pay sum of Rs.6,17,900 received on 2nd February,1978 on account of alleged duty of R/spirit. I hereby request you that my company was not involved and the Director Excise has disposed of this case under section 55A. Therefore, I do not stand responsible for this alleged excise duty. But even then I request you to give me 15 days time to consult my legal adviser to give the proper reply of this threatening letter which is also harassing one. Thanks."

7. We therefore, hold that the demand made by the impugned notice without determining the amount in any proceeding, is without lawful authority and is therefore, of no legal effect. However, we clarify this will not preclude the respondents from taking any proceedings in accordance with law. The parties are left to bear their own costs. M.B.A. Petition accepted.