2004 PLP 1676 (YLR)

(iii) the tax was collected by various contractors appointed by respondent No. 1; (iv) no tax was directly collected by Zila Council or its functionaries; (v) in the impugned decision dated 22‑11‑2003 respondent No.2 admitted the refundable claim of the petitioner at Rs.28,25,679 but held claim of Rs.20,84,323 as unascertainable; and (vi) the refundable amount was stated to be in the hands of various contractors listed in the impugned memo. and the respondents did not accept the liability for payment of the petitioner's claim.

5. The learned counsel for the petitioner admitting the collection of tax by the contractors, fixed the liability on the respondents as the principal of the contractors. Applicability of rule 8 of the Lease Rules, 1990 was denied while rules 16 and 18 of the Punjab Zila Councils (Export Tax) Rules, 1990 were stated to be the applicable rules.

6. To my mind, if the Export Tax Rules, 1990 are the applicable Rules, the learned counsel for the petitioner seems to have overlooked the specific provisions contained in rules 16 and 18 referred to by him as well as those of the rules, 14, 15 and

20. Rule 16 provides that a Zila Council may lease out through public auction for a period not exceeding one year the collection of Export Tax. The procedure thereto has been detailed in this rule.

7. All important provisions of rule 18 prescribe that all Export Tax Posts, after grant of lease, shall operate under the control of lessee/contractor. And all amounts collected as export tax. Shall belong to the lessee (Sub Rule 1) and "the, tax due shall be retained by the lessee".

8. Furthermore, under rule 20(2), the lessee was authorized to receive the export tax at the Export Tax Post either himself or through a person authorized by him. Zila Council was not to be responsible "for any loss or deprivation of Export Tax Income". The essence of this rule is that the amount of tax was to be collected, kept and retained by the lessee/contractor and the same belonged to him. Zila Council was not to be responsible to the lessee/contractor for any loss or deprivation of Export Tax Income. In case of a dispute regarding assessment made and orders passed under the Export Tax Rules, 1990, appeal was provided under rule 14 and a remedy of revision was available under rule 15 thereof.

9. In view of the existence of Statutory Rules regulating the relationship of the principal (the Zila Council) and the agent (the recovery contractor), the ordinary canons of agency cannot be C applied to the present case in their pristine form. Even otherwise, the contract between the Zila Council and the lessee will obviously be subject to the rules regulating the grant, of lease to the recovery contractor.

10. It is the admitted case of the petitioner that during the above stated period (1993 to 1999), the alleged illegal tax collection was made by the various contractors and not directly by Zila Council. The money so collected obviously belonged to the lessee, who was only liable to the Zila Council for the lease amount at the time of signing of the lease contract. The amounts of tax so collected by a contractor/lessee were not paid to the Zila Council.

11. In my opinion, irrespective of the provisions contained in rule 16 of the Export Tax Rules; 1990 relating to grant of lease specifically for collection of the Export Tax, the applicable rules in general to the leases for collection rights of tax, fee, rates, toll, cess and other charges levied by a Local Council are the Punjab Local Council (Lease) Rules, 1990. Wherefore, rule 8 thereto was applicable to the case of the petitioner. As such, in case of over charging the tax, the lessee was liable to refund the same alongwith penalty.

12. Under rule 8(3) of the Lease Rules, 1990, if any excess amount was charged from any person owing to miscalculation or error by a lessee, such person had the remedy to apply to the Taxation Officer of the Local Council for refund of the amount so charged in excess within a period of two days. The Taxation Officer under sub‑rule 4 thereof, was obliged to investigate the claim and to order refund of the same and in case of over charging, to impose penalty on the lessee. Against such an order, appeal, by a person or a lessee could be maintained under sub‑rule 5 of rule 8 of the Lease Rules, 1990.

13. Even under the above referred Lease Rules, 1990, the amount collected by the lessee was, refundable alongwith penalty by the lessee upon orders of the Taxation Officer etc. Zila Council, despite being the principal was not liable under the rules for any over charging or wrong charging by the lessees. Its only duty was to investigate the matter and to order refund and impose penalty upon an application by a taxed person against wrong or over charging.

14. In the present case, the respondents have fulfilled their obligations by passing the requisite order on the claim of the petitioner through impugned memo. dated 22‑11‑2003. Since the amounts were admittedly received, collected and recovered by the contractor/lessee, therefore, the respondents cannot be held to be liable for any illegal recovery made by the lessee. The respondents have also correctly relied upon judgment dated 25‑3‑2003 passed in Writ Petition No.13510 of 2002 holding that the petitioner cannot call upon Zila Council to reimburse the over charged amount to him in Zila Council as Zila Council had not received the amount from the contractor itself. The liability, if any in this context, is that of the contractor only.

15. It is also note‑worthy that the petitioner has not pleaded any of the contractors/lessees as respondents to the present Constitutional petition. Wherefor, H the petition fatally suffers for non impleadment of the necessary and proper parties.

16. In view of what has been observed above, this Constitutional petition is dismissed in limine alongwith C.Ms. The petitioner may, however, avail of its remedies to effect recovery of its I refundable claim against the lessee/contractors in accordance with law. The respondents at maximum will be proforma parties but not the liable parties in the recovery proceedings. S.A.K./P‑14/L Petition dismissed.