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Petitioner: MESSRS DAWOOD YAMAHA LTD. VS Respondent: GOVERNMENT OF BALUCHISTAN AND 3
Court Name: Balochistan High Court Judge(s): Mir Hazar Khan Khoso, Ajmal Mian Title:MESSRS DAWOOD YAMAHA LTD. vs GOVERNMENT OF BALUCHISTAN AND 3
JUDGMENT
Reported As: PLD 1986 Quetta 148 Result: Petition dismissed Judgment JUDGMENT ' AJMAL MIAN, ACTG. C. J.-The petitioners through this petition have prayed for the following reliefs :- In the cicumstances given above it is respectfully prayed that this Hon'ble Court may be pleased to declare, that :- (i) The petitioner's factory is situated outside the area of Town Committee, Uthal therefore, the Town Committee, neither exercised nor exercises jurisdiction to collect Octroi Tax from the petitioner the taxes have been illegally collected from the petitioner is liablc to be refunded with interest or adjusted against the future taxes. (ii) The respondent No, I had no jurisdiction to direct the petitioner to make payment of taxes. Even otherwise the direction was limited to 1980-81, if at all it had any sanctity of law, it only related to a specified period ; (iii) Until 2-10-1984 the goods imported in the factory were not taxable by the Council which was exercising jurisdiction. . (iv) Although after 2-10-1984, Union Council Kenwari exercises jurisdiction to collect taxes but the C.K.D. Kits are not imported for consumption used and sale, therefore. It is not taxable by the Union Council, Kenwari. (v) If at all this Honourable Court holds that C.K D Kits are taxable, the tax in excess of one per cent is oppressive, excessive, discriminator against principles of equality before law. Even in violation of the schedule of the local councils.
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(vi) The Honourable Court may direct the respondents to refund the illegally recovered amount or to adjust it in future dues. (iii) May grant any relief to which the petitioner may be found entitled. (viii) The costs of this petition may also be allowed." 2. The brief facts leading to the filing of the above petition are that the petitioners. (which is a limited company) have their factory in Mauza Chib Mandra, rehsil Uthal, District . Lasbella as per averment in the petition, where they assemble Motor Cycles from the C.K.D. Kits imported from Japan under the patent name of "Yamaha". The respondent No, 3 i,e, the Town Committee Uthal, had levied the octroi on the various items of goods imported within its limits for consumption, use or sale at the various rates, namely. About per cent to the value of the articles. Upon the request of the petitioners by a Notificatio No, 5-158/78(PLGB)/ A01, dated 29th November. 1978 exemption from the payment of Octroi was granted by the respondent No, 1 for a period of two years commencing from 1st July, 1978 and expiring on 30th June. 1980 in respect of raw material, Kits and parts in knock-down condition, electrical and other equipment's and building material apart from grant of exemption of five years in respect of industrial and electrical machinery entering into Lasbella District. The respondent No, 3 revised the Schedule of Octroi (hereinafter referred to as the Schedule) by a Notification, dated 22nd July, 1980 (Annexures 'D/1 and D/2 to the petition). After the expiry of the above period of two years. The petitioners were called upon to pay the octroi as per Schedule, but they made again representation for further exemption, which remained under consideration. After that, the Secretary, Local Government, Rural Development and Agrovils Department (Local Councils Wing) by his letter, dated 10th November, 1981 addressed to the Chairman, Town Committee, Uthal and a copy whereof was endored to the petitioners and to Lasbella Textile Mills at Uthal, conveyed the following decision of the Governor/M.L.A. "that the balance amount of octroi charges for the year i980-81 be paid directly to the Government by Messrs Lasbella Textile Mills and Dawood Yamaha Limited." ' It seems that the petitioners again made representation, in response whereof, the Headquarter, Martial Law Administrator, Zone "D' by its letter, dated 12th January, 1982 ordered the suspension of recovery and the convening of the meeting on 20th January. 1982. But it appears that eventually it was decided to press for the payment of octroi. The petitioners as per schedule of the payments annexed to the petition started making payment in January, 1982 and continued to pay upto December, 1984, totalling a sum of Rs, 71,15,526.77. However, from the documents filed alongwith the petition, it appears that the petitioners had been making representations from March, 1981 to the effect that the percentage of octroi, namely, 3 per cent on the C K. D. Kits was excessive and was not compatible with one per cent charged by the Town Committee, Hub which was not very far away. It also seems that the Government of Baluchistan by its Notification, dated 3rd July, 1983 issued in pursuance of the powers conferred on it by section 10 read with sections 7, 8 and 11 of the Baluchistan Local Government Ordinance, 1980 (II of 1980) (hereinafter referred to as the 'Ordinance') constituted Local Councils in the District Lasbella and Kalat Division as per schedule contained therein, subject to the proviso that the above Notification shall take effect from the date to be notified by the Government in this behalf. The above schedule, inter alia, includes Union Council Kenwari i,e,, the respondent No, 4 and also Town Committee Uthal. It may be pertinent to reproduce bereinbelow the item No, 5 and items No, 13(D) of the aforesaid schedule, which give the description of the respondents Nos. 3 and 4 :- "(5) Union Council, Kenwari (1) Chib Mandra-2. (2) Winder. (3) Salarag. (4) Kenwari. (5) Watta. (6) Bohar. (7) Kharrari-1. (8) Kharrari-2"
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(1) Mari-1. (3) Mari-3. (5) Kandiara. (7) Banodi." 13(D) Town Committee, Uthal (2) Mari-2. (4) Gab Kori. (6) Awadan. 3. It may be partinent to observe that the respondent No, 4 was not in existence prior to the issuance of the above Notification, but the respondent No, 3 was constituted by the Notification, dated 12th June, 1976. It may be pertinent to reproduce the above Notification, which reads as follows :- "Government of Baluchistan Local Government Rural Development, and Agrovilles Department. (P. L. G. Board) Dated, Quetta the 12th June, 1976. NOTIFICATION ' No, 7-98/75(PLGB).-In exercise of the powers conferred under section 8 of the Local Government Act, 1975, the following Rural areas shall, with effect from 15.5-1976 be converted into. Urban areas and known by the name mentioned here under :- Limit of Town Committees Uthal S. No, Name of Name of Village/Towns Included. District T/Committee Lasbela Uthal (1) A straight line from R.C.D. Road running alongwith the Southern side of Khantra Nadi towards East upto Pillar No, 1. (2) A straight line from R.C.D. Road running alongwith the Southern side of Khantra Nadi towards West upto Pillar No, 2. (3) A straight line from R.C.D. Road running alongwith Nothern side of Landa Dhora towards East upto Pillar No, 3. (4) A straight line running alongwith Bank of Northern side of Landa Dhora towards East upto Pillar No, 4. (5) A straight line running from Pillar No, 1 (Khantra Dhora) towards Pillar No, 4 (Landa Dhora) towards the Eastern side of R.C.D. Road. (6) A straight line running from Pillar No, 2 (Khantra Nadi) towards Pillar No, 3 (Landa Dhoras) Western side of R.C.D. Road. (Sd.) (Shahzada Sultan Hamid) Additional Secretary, Local Government Department." ' It may be noticed that the boundaries given in the above-quoted Notification, dated 12th June, 1976 of the respondent No, 3 have different description than the boundaries given in the above Notification, dated 3rd July, 1983. The Octroi was levied by the respondent No, 3 on the basis of the above Notification, dated 12th June, 1976. 4. It is the case of the respondent No, I i,e,, the Provincial Government that the second Notification notifying the date for enforcing the date for enforcing the above Notification, dated 3rd July, 1983 was not issued till 29th May, 1985, where the case of the petitioners is that in pursuance of above Notification, dated 3rd July, 1983, the elections of the respondents Nos. 3 and 4 were held and the Councillors were elected and declared as elected and that they also started functioning. Be that as it may, in October, 1984, the respondent No, 4 also levied Octroi. After that, they issued notices to the petitioners for the payment of Octroi. It seems that in August, 1984, the petitioner's representative met the Secretary of the respondent No, 4 and first time contended that their factory was not situated within the limits of the respondent No, 3 but within the limits of the respondent No, 4, which is reflected from para. 1 of the respondent No, 3's Secretary letter, dated 24th February, 1985, which reads as follows :- "Para. 1.-With reference to your letter dated 4-12-1984 handed over personally by one of your employee and discussions of your various representatives it may be mentioned that it was for the first time, perhaps in the month of August, 1984 when one of your representative met me and claimed that as Dawood Yamaha factory is not situated within the limits of Town Committee, Uthal, therefore, Octroi
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duty cannot be recovered by the Town Committee, Uthal instead of Union Council concerned. The representative, however, did not produce any documentary proof about his claim, so he was satisfied that Town Committee.Is recovering octroi from Dawood Yamaha since a long time, therefore, the undersigned who- has resumed charge on 13-12-1983 cannot refrain from recovery of octroi duty being recovered from a long time. In absence of production of documentary proof by him, I presume that the said representative was satisfied about my verdicts." ' It appears that after December, 1984, the petitioners stopped making payment of the Octroi to the respondent No, 3, which continued to press for the payment. The petitioners filed the above petition on 25th April, 1985 and when it was fixed for Katcha Peshi on 28th April, 1985, the comments were sent for from the respondents Nos. 1, 3 and 4, in response to which, the comments were submitted. The petition was admitted to regular hearing on 17th June, 1985. It seems that after the filing of the above petition, the Governor of Baluchistan first issued a Notification, dated 29th May, 1985 (hereinafter referred to as the Notification) and thereafter, during the arguments on 7-11-1985 promulgated Baluchistan Local Government (Amendment) Ordinance, 1985 (hereinafter referred to as the Validation Ordinance) (Ordinance XXII of 1985) which retrospective effect from 1st July, 1980. It may be advantageous to reproduce hereinbelow the above Notification :- "NOTIFICATION No, 5-108/79 (PLGB) AO-1V/Vol-II/9522-39.----In exercise of the powers conferred by section 8 of the Baluchistan Local Government Ordinance, 1980 (li of 1980), the Government of Baluchistan is pleased to include the entire Industrial estate area situated in Mauzas Chib Mandra- II, Chak Kharari and Chak Sarkar Karari, within the limits of Town of Uthal, with effect from 1st day of July, 1980. (2) In exercise of the powers conferred by clause (d) of subsection (1) of section 70 of the Baluchistan Local Government Ordinance, 1980 (II of 1980), the Government of Baluchistan is further p eased to direct that the amount of Octroi already levied, charged, collected or realized by the Town Committee, Uthal, with effect from 1st day of July, 1980 from industrial units located in the industrial estate area, Uthal, shall be deemed to have been validly levied, charged, collected or realized, as the case may be, as if this Notificatign was in force on the day on which the Octroi was levied, charged, collected or realized. (3) In exercise of the powers conferred by section 10 read with sections 7, 8 and 11 of the Baluchistan Local Government Ordinance, 1980 (II of 1980), the Government of Baluchistan is further pleased to appoint the 1st day of November, 1983, to be the date on which Notification No, 8-34/79(PLGB) 8316- 50, dated 3rd July, 1983, shall come into force, except the provisions contained in pares. 1 and 2 above, which shall have effect on the date. Mentioned therein." 5. In support of the above petition, Mr. Tahir Muhammad Khan, learned counsel for the petitioners has urged as follows :- (1) That since the factory is not located within the limits of the respondent No, 3, the recovery of Octroi is without jurisdiction ; (ii) That under the second Schedule, to the Ordinance there is no power vested in the respondent No, 3 to levy any Octroi. (This argument was not pressed when it was pointed out to Mr. Tahir Muhammad Khan that item 2-A was incorporated by Ordinance XIII of 1980 in Part II of the Second Schedule to the Ordinance, which provides tax on the import of goods and animals for consumption, use or sale.) (iii) That since C.K.D. Kit is an item known in the commercial parlance and as it has not been included in the Schedule of Octroi, the recovery of the Octroi is illegal ; (iv) That in any case, C.K.D. Kits are not imported by the petitioners within the limits of the respondent No, 3 for consumption, use or sale and, therefore, the recovery is illegal ; (v) That in any event, the petitioners liability is to pay Octroi under item No, 163 of the Schedule at the rate of 1 per cent and not under item No, 169 at the rate of 3 per cent ad valorem ;
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(vi) That the 3 per cent ad valorem or Octroi is in violation of Article 4 of the Constitution ; (vii) That the Notification i,e, dated 29th May, 1985 has been impugned, inter alia. On the grounds that the same is ultra vires of the powers contained in the Ordinance, inasmuch as, is in violation of sections 8, 9, 11, 68, 69 and 70, mala fide, issued in colourful exercise of powers vested, being subordinate legislation cannot exceed or amend the law and that it cannot be given retrospective effect ; (viii) That the. Validation Ordinance does not affect the pending cases ; ' Mr. Muhammad Zafar, learned counsel for the respondent No, 4 supported the arguments of Mr. Tahir Muhammad Khan and further submitted that under the scheme of the Ordinance, the respondent No, 1 could not have sliced away a portion of the areas of Mauzas Chib Mandra 2, Chak Kharari and Chak Sarkar Karari and included the same through the Notification in the respondent No, 3's limits and, therefore, it is ultra vires of the powers of the respondent No, 1, besides being mala fide. ' Mr. Amirul Mulk Mengal, learned Advocate-General appearing for the respondent No, 1 has contended as follows :- (i) That the petitioners had alternate remedy in the form of an appeal, which argument was not pressed as he was unable to place enrecord any rule providing appeal in terms of section 149 of the Ordinance ; (ii) The question whether the petitioner's, factory, is situated within the limits of the respondent No, 3 or not, or the respondent No, 4, is a disputed question of fact, which cannot be investigated in a Constitutional Writ Petition ; (iii) That the petition has not been filed by a competent person ; (iv) That the petition suffers from laches ; (v) That the petition is liable to be dismissed on account of estoppel and acquiescence ; (vi) That the C.K.D. Kits are covered by item No, 169 and not by item No, 163 of the Schedule ; (vii) That the recovery of Octroi at the rate of 3 per cent is not violative of Article 4 of the Constitution ; (viii) That the Notification is valid ; and (ix) In any case, the Validation Ordinance has cured the defect, if any. ' Raja M. Afsar, learned counsel appearing for the respondent No, 3 has adopted the arguments of Mr. Amirul Mulk Mengal, learned Advocate-General and in futherance of his arguments cited a number of cases. 6. Before taking up the respective contentions of the learned counsel for the parties on merits, it may be appropriate to take up the contentions of Mr. Amirul Mulk Mengal, learned Advocate- General and of Raja M. Afsar, learned counsel for the respondent No, 3 pertaining to the incompetency of the above petition, laches, estoppel and acquiescence. ' Adverting to Mr. Amirul Mulk Mengal's contention that the petition has not been held by a competent person, it may be observed that the petition has been signed by one Mr. Humayun Zafar Hatmi, Special Attorney of the petitioners. According to Mr. Tahir Muhammad Khan, learned counsel for the petitioners, Mr. Hatmi is the General Manager of the petitioner's-Company. It has been contended by the learned Advocate-General that the petition has neither filed a copy of the Articles of Association, nor a copy of the Board of Directors' resolution resolving to file the above petition and authoriing Mr. Hatmi to file the same. It was further contended by him that neither the petition, nor the Special Power-of-Attorney contains the seal of the Company. It has- also been contended by Raja M. Afsar, learned counsel for the respondent No, 3 that even if it is to be assumed that the above formalities were complied with, the Special Power-of-Attorney produced by the petitioners, does not contain any express power either to file a writ petition or to sign the same on behalf of the petitioner's Company.
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' On the other hand, Mr. Tahir Muhammad Khan, learned counsel for the petitioners has submitted that the above point was not raised by the above respondents either in their comment.; or in the counter-affidavits and, therefore, they should not be allowed to raise the same. He has further submitted that this Court should not non-suit the petitioners on a technical ground. 7. It is true that no objection has been raised by the respondent No, 1 or 3 in their comments or in their counter-affidavits and the same has been first time raised during the arguments. We are inclined to hold that a technical objection as to the competency of the person signing a A writ petition on behalf of a Limited Company is to be raised at the earliest opportunity, so that the other party may rectify the defect if any, though it is incumbent upon a party filing a legal proceeding to ensure that the same is filed by a competent person in accordance with law after complying with the various formalities. ' Mr. Amirul Mulk Mengal, learned Advocate-General in furtherance of his above submission has referred to the following judgments :- (i) Messrs Muhammad Siddiq, Muhammad Umar and another v. The Australasia Bank Limited PLD 1966 SC 684, in which, the Honourable Supreme Court while dealing with the question of filing of a suit by a constituted Attorney of a Public Limited Company, observed that a constituted Attorney could only do so, if he was duly authorised in that behalf and occupied one or other of the offices mentioned in rule 1 of Order XXIX of the Civil Procedure Code. It was also observed that the Articles of Association of the Company, should also contain the power to authorize the Directors to delegate the power. It was further observed that it was not necessary to examine the Managing Director for ascertaining the above facts. (ii) Khan Ifiikhar Hussain Khan of Mamdot (represented by 6 heirs) v. Messrs Ghulam Nabi Corporation Ltd. Lahore PLD 1971 SC 550 In the above case, the Honourable Supreme Court while commenting upon the question of filing of a suit on behalf of a Company observed that a suit on behalf of a Company by the Director Incharge of the Company, is not competent unless he is authorised by a resolution passed by the Company's Board of Directors in a meeting, which could not have been duly convened unless due notice was given to all the Directors. It was held that since there was no competent meeting convened for passing the resolution for authorising the filing of a suit, the suit was incompetent. ' Whereas, Raja M. Afsar, learned counsel for the respondent No, 3 has referred to the following cases :- (i) Messrs Eagle Star Insurance Co. Ltd. v. Messrs Usman Sons Limited and others PLD 1969 Kar. 123, in which, a learned Single Judge of the 'erstwhile High Court of West Pakistan at Karachi Bench, while trying a suit, observed that a Power-ofAttorney must be construed strictly and that the Attorney can neither go beyond. Nor can deviate from the terms of the Powerof-Attorney. It was further observed that if the Power-of-Attorney contained the power to obtain loan on behalf of the Principal on security of the Principal's property, such authority cannot be extended so as to enable the Attorney to mortgage property of Principal for loan obtained by third party. (ii) Munir Hussain v. Mst. Mehrun Nisa (through her legal heirs) PLD 1982 Kar. 71. In the above case, a learned Single Judge of the Sind High Court after re-producing the Powerof-Attorney, observed that the same had not authorised the Attorney either to sign or verify or present the ejectment application. The appeal of the tenant was allowed on the ground that the ejectment application was not filed by a competent Attorney. ' Mr. Tahir Muhammad Khan, learned counsel for the petitioners in rebuttal has referred to the following cases (i) Lt.-Col. (Retd.) P. G. Bragan:a v. The Border Area Allotment Committee and another 1984 CLC 1479, in which, a learned Single Judge of the Lahore High Court after perusing a Power-of-Attorney executed in favour of the petitioner, held that the tenor of the same indicates that the Attorney was
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authorised to file proceeding in all the Courts which the executant could conceive of at time of execution of Power-of-Attorney including all disputes pertaining to land, inter alia, in civil Courts. It was further held by him that the above document be given beneficial interpretation and that it included the power to apply to High Court exercising Constitutional jurisdiction in a civil matter. It was also observed that technicalities are undesirable. It was also held that in a Constitutional petition wider Article 199 of the Constitution of 1973, even an oral authority to file the same cannot be excluded from consideration. (ii) Manager, Jammu. And Kashmir, State Property in Pakistan v. Khuda Yar and another PLD 1975 SC 678. In the above case, the Honourable Supreme Court while hearing a civil appeal observed that the primipal object behind all legal formalities is to safeguard the paramount interest of justice and that mere technicalities unless offering insurmountable hurdles, not to be allowed to defeat the ends of justice. (iii) Iyakku Mathoo v. Julius Elias Metropolitan AIR 1962 Ker. 19, in which, a learned Single Judge of Kerala High Court held that where the plaint is filed under the signature of one who is found not to be a recognised agent, the defect can be cured subsequently, subject however, to the requirement that the suit must have been instituted with the knowledge and authority of the plaintiff. 8. It may be observed that Mr. Tahir Muhammad Khan, learned counsel for the petitioners on 13th November, 1985 has produced a photostat copy of page 12 of the petitioners's Company's Articles of Association, clause 66 of which, provides that the Directors may delegate their powers to Committees consisting of such member or members as they think fit. He has not produced any resolution of the Board of Directors as according to him, the time available was not sufficient to send for the resolution from the Head Office of the petitioner's Company. We are inclined to hold that since the respondents Nos. I and 3 have, not raised any plea to the effect that the petition was not signed by al competent person in their comments or in their counter-affidavits, which they should have done, it will not be just and proper to dismiss the above petition on the above technical ground. The above clause 66 of the Articles of Association of the petitioner's company authorises the Directors to delegate their power. It may also be observed that undre rule 1 of Order XXIX of the Code of Civil Procedure, it has been provided that in a suit by or against a Corporation, any pleading may be signed and verified on behalf of the Corporation by the Secretary or by any Director or other Principal Officer of the Corporation, who is able t despose to the facts of The case. If Mr. Hatmi is factually the General Manager of the petitioner's Company as contended by Mr. Tahir Muhamma Khan, he is covered by the expression "other Principal Officer". We are also inclined to take the view that there is a vast difference between a sui and a constitutional petition, inasmuch as, the provisions of the Code o Civil Procedure are strictly applicable to a suit, whereas, they are not strictly applicable to constitutional petitions, though some of the provi sions thereof are pressed into service to regulate the conduct of the petitions C in the absence of any rule on a particular topic framed by the High Court for regulating the constitutional petitions. We are also inclined to hold that the Court will be…
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