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Petitioner: CROWN BUS SERVICE LTD. VS Respondent: CENTRAL BOARD OF REVENUE AND 2 OTHERS
Court Name: Lahore High Court Judge(s): K. Muhammad A. Samadani, Karam Elahi Chauhan Title: CROWN BUS SERVICE LTD. vs CENTRAL BOARD OF REVENUE AND 2 OTHERS Case No.: Writ Petition No, 1380 of 1971 Date of Judgment:1976-04-05 Reported As: 1976 PTD 321 Result: Petition dismissed
JUDGMENT
JUDGMENT ' KARAM ELABEH CHAUHAN, J.-The petitioner is a limited company which is doing transport business with its head office at Baghbanpura, Lahore. It was being assessed to income-tax by the Income- tax Officer, Ward-II, Lahore, under the Commissioner of Income-tax, Lahore Zone, Lahore, The Central Board of Revenue vide its order bearing No, C. No, 55(18) L T. P. 61-Part. IV, dated 3-11-1967 issued a direction under subsection (2) of section 5 of the Income-tax Act XI of 1922 that the Commissioner of Income-tax (Investigation), Karachi shall perform, to the exclusion of any other Commissioner, the functions of a Commissioner of Income-tax in respect of the cases of the petitioner-Company. The effect of this direction was to transfer the jurisdiction of the cases of the petitioner to the Commissioner of Income-tax (Investigation), Karachi. The said Commissioner of Income-tax (Investigation), Karachi, vide his order bearing No, Jud-15(A) 1967-68/185e, dated 14-11- 1967 assigned the cases of the petitioner to the Income-tax Officer (Investigation), Circle-II, Lahore. The Income-tax Officer concerned, therefore, passed the assessment orders for the assessment years 1964-65 and 1965-66 on 30-6-1970 and for the assessment years 196t-67, 1967-68 and 1968- 69 on 2t-6-1971. The tax levied in pursuance of the aforesaid assessment orders was later sought to be recovered from the petitioner. The petitioner has consequently filed the present writ petition in which he has challenged the constitution composition of the Central Board of Revenue with a view to get out of the orders transferring the jurisdiction of the cases of the petitioner to the Commissioner of Income-tax (Investigation), Karachi and the Income-tax Officer (Investigation), Circle-II, Lahore. As a matter of fact this case is being heard along with a number of other cases in which the assessees concerned have similarly challenged the analogous respective orders of the Central Board of Revenue whereby their cases were also transferred to other Income-tax Officers.
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We gave opportunity to all the counsel concerned to argue the point above mentioned and the present judgment and order disposes of the said point as hereinafter follows. Re : Constitution of Central Board of Revenue 2. Mr. Javaid Hashmi learned counsel for the petitioner referred to sections 2 and 3 of the Central Board of Revenue Act IV of 1924, which in their original form read as follows:- "2. Constitution of Central Board of Revenue.-As soon as may be after the commencement of this Act, the Governor-General-in-Council shall constitute a Central Board of Revenue, consisting of one or more persons appointed by it, which shall be subject to the control of the Governor- General-in-Council in the exercise of such powers and the performance of such duties as may be entrusted to it by the Governor General-in-Council or by or under any law. 3. Procedure of the Board.-(1) The Governor-General-in-Council may make rules for the purpose of regulating the transaction of business by the Cefltral Board, of Revenue, and every order made or act done in accordance with such rules shall be deemed to be the order or act, as the case may be, of the Central Board of Revenue. (2) Any rules under subsection (1) may be made so as to be retrospective from any date not earlier than the commencement of this Act and such rules may also validate any acts done or orders made by, or any proceedings of, the Central Board of Revenue or any of its Members or officers before the making of such rules which, management of those rules, would not be inconsistent therewith. (3) No act, order or proceeding validated under subsection (2) shall be called in question merely on the ground that such act, order proceeding was not valid at the time when it was done, made or taken." (The words "Governor-General-in-Council" were substituted by the words "Central Government' by the Adaptation of Laws Order, 1937 and subsections (2) and (3) to section 3 were added by section 13 read with Sixth Schedule, item No, 2 of the Finance Act XII of 1967). According to the learned counsel for the petitioner, on 29-3.1924, there was issued a notification constituting the Central Board of Revenue and appointing its first members. This notification, which was published in the Gazette of India, 1924, Part I, page 256, reads as follows:- "THE CENTRAL BOARD OF REVENUE ACT, 1924 (IV of 1924) ' Constitution of a Central Board of Revenue No, 755, dated the 29th March, 1924.-In exercise of section 2 of the Central Board of Revenue Act, 1924 (IV of 1924), and section 22 of the General Clauses Act, 1897 (X of 1897), the Governor-General-in-Council is pleased to constitute a Central Board of Revenue consisting of the following persons, namely :- ' Mr. Alexander Robers Loftus Tottenham, I. C. S. And Mr. Alan Hurbert Lloyd, I. C. S." ' The argument of the learned counsel was that according to a strict construction of section 2 of Act IV of 1924 Central Government was required to do two things; firstly to constitute a Central Board of Revenue and secondly to appoint its members. The initial notification dated 29-3-1924, according to the learned counsel, fulfilled both these requirements, inasmuch as, it constituted the Central Board of Revenue and, at the same time, appointed its members as well. This, according to the learned counsel, was quite in order. The things remained like this but after partition of the country there was issued a notification on 29-8-1947, which reads as follows:- "THE GAZETTE OF PAKISTAN, KARACHI, FRIDAY, AUGUST 29, 1947 PART I-SECTION 2 ' Karachi, the 29th August, 1947. ' No, 3.-Mr. J. B. Sherer, 0. B. E., I. C. S. Is appointed Joint Secretary to the Government of Pakistan, Ministry of Finance (Revenue Division), and Member, Central Board of Revenue with effect from the 15th August, 1947.
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' Mr. A. A. Burney is appointed Deputy Secretary to the Government of Pakistan, Ministry of Finance (Revenue Division) and First Secretary, Central Board of Revenue with effect from the 15th August 1947. ' Mr. Zafar Ullah is appointed Under Secretary to the Government of Pakistan, Ministry of Finance (Revenue Division) and Second Secretary, Central Board of Revenue with effect from the 15th August 1947. ' Mr. L. G. Leary is appointed Specialist Officer, Central Board of Revenue, with effect from the 15th August, 1947. (Sd.) V. A. C. Turner, Secy." ' Learned counsel argued that according to section 17(1) of the Government of India Act, 1935 all executive actions of the Central Government were required to be done in the name of the Governor-General. Learned counsel submitted that as the notification dated 29-8-1947 was not issued in the name of the Governor-General, therefore, the same was invalid and ineffective, with the result that thereafter and thereunder there did not remain a validly manned composed and constituted Central Board of Revenue. The contention has no force. In Khalid Waheed and another v. The Crown (1) it was laid down that the provisions of section 17(1) hereinbefore mentioned were merely directory in nature non-observance whereof could not effect the acts of the Central Government if otherwise they had been performed by competent authority. See also Khandkar All Afzal v. Pakistan and another (2) decided with reference to Article 41(2) of 1956 Constitution, 3. The next point argued was that though the notification pertained :o the appointment of a member of the Central Board of Revenue and his Secretariat but it was not enough and did not amount to constitution of Central Board of Revenue, as such, for which there should have been a separate recital to that effect in the said notification which, however, was not there. In Act IV of 1924 no particular mode of constituting a Central Board of Revenue has been mentioned except, perhaps, by making appointments of its member and we are doubtful as to whether any such plea in this context can be successfully advanced by the petitioner. The objection of the learned counsel for the petitioner is based on the assumption that under section 2 of Act IV of 1924 two formalities viz. (a) constitution of Central Board of Revenue and (b) appointments of its members, had to be independently and distinctly performed and if, for instance, certain person r persons are straightaway appointed as members of the Central Board of revenue that probably is not enough. We do not agree, because, there is nothing to lead to such a corollary in the wording of section 2 of Act IV of 924. Confining ourselves to the notification dated 29-8-1947 we may observe as a matter of principle, all that the Courts of law are required to examine while considering a document or an instrument is the intention and not merely the form of any order or direction contained therein depending pan the facts, circumstances and the context of each case. Acting on that principle we hold that if the intention of making appointments of certain officer or officers as members of the Central Board of Revenue is for example it a view to establish the Central Board of Revenue and similarly if the appointments cannot be made except when it implies a creation of the central Board of Revenue, then on the facts and overall circumstances in such situations, it can be safely held that the aforesaid appointment Inter lia implied the constitution of the Central Board of Revenue as well and a pacific and independent recital regarding the creation of the Central Board of Revenue is not to be considered as a must, especially when, as already pointed out, in Act IV of 1924 no particular form and procedure for Constituting a Central Board of Revenue had been laid down. There is no magic in the words "Central Board of Revenue is hereby constituted". When the Central Board of Revenue for the British India was created :he act of creation was not distinct from the act of appointment of its first members. Mr. Mumtaz Hussain has referred in this behalf to the West Pakistan Board of Revenue Act and drawn our attention to the fact that the notification constituting the West Pakistan Board of Revenue was issued separately, first, and then by a second
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notification the members of the Board were appointed. In view of this fact he argued that it was necessary for the Central Government also to issue a notification constituting s Central Board of Revenue before appointing Mr. Sherer or anybody else is a member of the Board. But in the first place it is to be noted that he law relating to the Provincial Board is not in the same terms as the Act V of 1924. The corresponding provisions in the two laws being different, (1) PLD 1956 Lah. 541 (2) PLD 1959 Kar. 105 it is understandable that the mode of creation should also be different. Secondly what was done by the Executive authority in the Province cannot have the force of a precedent either for the Central Government or for this Court. However, as we have no intention to interpret the provisions of a Provincial law which is not directly in issue before us, we would not like to say anything further about the same. The result is that judged from any point of view the notification dated 29-8.1947 can very well be held to have constituted a Central Board of Revenue, inasmuch as, it made appointment of its member as also of its First Secretary and Second Secretary etc. 4. It was then argued that the powers to constitute a Central Board of Revenue and appoint its members was given by Act IV of 1924 to the "Central Government", which according to the General Clauses Act X of 1897 meant the "Governor-General". This could be read with sections 7 and 41 of the Government of India Act, 1935 which laid down that executive actions in connection with the affairs of the Federation were to be performed and all appointments in connection therewith were to be made by the Governor-General or his delegates. It was submitted that the appointment of Mr. Sherer as a member of the Central Board of Revenue in 1947 was neither made by the Governor-General nor by any of his delegates and, therefore, the same was invalid and of no legal consequence. The notification is signed by the Secretary, Ministry of Finance, and proceeding on the principle that official acts are presumed to have been regularly done no material has been placed before us to rebut that presumption. It was laid down in Masudul Hassan v. Khadam Hussain and another (1) that "it is well-settled that when the writ is moved by a law officer on behalf of th State, it is for the respondent to establish his legal right to retention of the office in question. But where a private petitioner seeks the writ, the burde of proving that the respondent does not have the right to hold such offic is placed upon the petitioner". The objection regarding the appointment o Mr. Sherer was being raised for the purpose of advancing a plea that after creation of Pakistan there was not constituted and there did not come into being any Central Board of Revenue, inasmuch as, even uptill now no specifi order/notification so reciting specifically has been issued and that mere appointments of various members from time to time was not enough on the subject. Mr. Mumtaz Hussain, Advocate who appeared in some o the cases took up an extreme stand on the subject in hand and submitted that every time member of the Central Board of Revenue was appointed simultaneously therewith there should have been issued an independent and specific order under section 2 of Act IV of 1924 indicating that the Central Board of Revenue was also being thus constituted or created with that member. We have already repelled the principle on which the objection is founded but if the argument of Mr. Mumtaz Hussain is to be taken seriously then each appointment on the view we have adopted can very well be taken to be a constitution of the Central. Board of Revenue with the induction of the concerned appointee. Facing this situation learned counsel in some cf the cases started questioning appointments of various members which had taken place at the time relevant to their cases but we must say that no material was placed before us to find any fault therein. 5. Though what has been written above was sufficient to repel the objection regarding the constitution of the Central Board of Revenue but lot of time was consumed by the learned counsel for the petitioners in presenting their cases from another point of view to which we will now (1) PLD 1963 SC 203 1976 CROWN BUT SERVICE LTD. V. CEN
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advert. They argued that the Central Board of Revenue was an authority or a legal entity which had to be first constituted and after it was so don appointments of its members could be made thereto or therein. The Central Board of Revenue was, according to the learned counsel, thus constituted in 1924 by virtue of the notification, dated 29-3-1924. They submitted that after partition of the country any such forum, institution or authority, which earlier exercised jurisdiction in British India, had to be re-constituted in the from of what they called an "adaptation" for the Dominion of Pakistan separately by a notification under Article 9 of the Pakista (Adaptation of Existing Pakistan Laws) Order, 1947 (G. G. 0. No, 20 of 1947, promulgated on 14-8-1947). According to the learned counsel as this was not done there did not come into being a proper and lawful Central Board of Revenue for Pakistan and mere appointment of certain officers as members of the Central Board of Revenue from time to time was not enough with the result that they neither constituted as valid members and nor did there exist, in the eye of law, any validly constituted Central Board of Revenue. The later part of this argument has already been dealt with, but taking up its first limb Article 9 to which reference is being made by the learned counsel reads as follows:- "Article 9.-(1) Any reference in an existing Pakistan law to a tribunal, authority, officer or official body whose jurisdiction or authority immediately before the appointed day extends- (a) to the whole of India or British India or over parts of British India which on the said day fall partly within the Dominion of India and partly within the Dominion of Pakistan, or (b) to the whole of the Province of Bengal or over parts of that Province which on the said day fall partly within the Province of East Bengal and partly within the Province of West Bengal, or to the whole of the Province of Assam or over parts of that Province which on the said day fall partly within the Province of Assam and partly within the Province of East Bengal, or (c) to the whole of the Province of the Punjab or over parts of that Province which on the said day fall partly within the Province of East Punjab and partly within the Province of West Punjab, shall be construed as references to such tribunal, authority, officer or official body as the appropriate Government may by notification in the official Gazette constitute or appoint in that behalf, and any such direction may be given so as to have retrospective effect from the appointed day. (2) For the purposes of this article, the expression "appropriate Government" means, as respects a law relating to a matter enumerated in List I of the Seventh Schedule to the Government of India Act, 1935, the Central Government, and as respects any other law, the Provincial Government of East Bengal or West Punjab, as the case may by." ' This provision of law, In our opinion, should be read with section 18 and section 9 of the Indian Independence Act, 1947 (10 and 11 G. E. 0 6, C. H. 30). They read as follows:- "18. Provisions as to existing laws, etc.-(1) In so far as any Act of Parliament, Order-in-Council, order, rule, regulation or other instrument passed or made before the appointed day operates otherwise than as part of the law of British India or the new Dominions, references therein to India or British India, however worded and whether by name or not, shall, in so far as the context permits and except so far as Parliament may hereafter otherwise provide, be construed as, or as including, references to the new Dominions, taken together, or taken separately, according as the circumstances and subject-matter may require : ' Provided that nothing in this subsection shall be construed as continuing in operation any provision in so far as the continuance thereof as adapted by this subsection is inconsistent with any of the provisions of this Act other than this section. (2) Subject to the provisions of subsection (I) of this section and to any other express provision of this Act, the Orders-in-Council made under subsection (5) of section three hundred and eleven of the Government of India Act, 1935, for adapting and modifying Acts of Parliament shall, except so
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far as Parliament may hereafter otherwise provide, continue in force in relation to all Acts in so far as they operate otherwise than as part of the law of British India of the new Dominions. (3) Save as otherwise expressly provided in this Act, the law of British India and of the several parts thereof existing immediately before the appointed day shall, as far as applicable and with the necessary adaptation, continue as the law of each of the new Dominions an the several parts thereof until other provision is made by laws o' the Legislature of the Dominion in question or by any other Legislatur or other authority having power in that behalf. (4) It is hereby declared that the Instruments of Instructions issue before the passing of this Act by His Majesty to the Governor General and the Governors of Provinces lapse as from the appointee day, and nothing in this Act shall be construed as continuing in fore any provision of the Government of India Act, 1935, relating to such Instruments of Instructions. (5) As from the appointed day, so much of any enactments as require the approval of His Majesty- in-Council to any rules of Court shall not apply to any Court in either of the new Dominions. Section 9.-Order for bringing this Act into force. -(1) The Governor General shall by order make such provision as appears to him to b necessary or expedient- (a) for bringing the provisions of this Act into effective operation; (b) for dividing between the new Dominions, and between the new Provinces to be constituted under this Act, the powers, rights, property, duties and liabilities of the Governor-General-in- Council or, as the case may be, of the relevant Provinces which, under this Act, are to cease to exist; (c) for making omissions from, additions to, and adaptations and modifications of, the Government of India Act, 1935, and the Orders-in-Council, rules and other instruments made thereunder, in their application to the separate new Dominions; (d) for removing difficulties arising in connection with the transition to the provisions of this Act; (e) for authorising the carrying on of the business of the Governor-General-in-Council between the passing of this Act and the appointed day otherwise than in accordance with the pro visions in that behalf of the Ninth Schedule to the Government of India Act, 1935; (f) for enabling agreements to be entered into, and other acts done, on behalf of either of the new Dominions before the appointed day; (g) for authorising the continued carrying on for the time being on behalf of the new Dominions, or on behalf of any two or more of the said new Provinces, of services and activities previously carried on behalf of British India as a whole or on behalf of the former Provinces which those new Provinces represent; (h) for regulating the monetary system and any matters pertaining to the Reserve Bank of India; and (1) so far as it appears necessary or expedient in connection with any of the matters aforesaid, for varying the Constitution, powers on jurisdiction of any Legislature, Court or other authority in the new Dominions and creating new Legislatures, Courts or other authority is therein. (2) The powers conferred by this section on the Governor-General shall, in relation to their respective Provinces, be exerciseable also by the Governors of the Provinces which, under this Act, are to cease to exist ; and those powers shall, for the purposes of the Government of India Act, 1935, be deemed to be matters as respects which the Governors are, under that Act, to exercise their individual judgment. (3) This section shall be deemed to have had effect as from the third day of June, nineteen hundred and forty-seven, and any order of the Governor-General or any Governor made on or after that date as to any matter shall have effect accordingly, and any order made under this section may be made so as to be retrospective to any date not earlier than the said third day of June Provided that no person shall be deemed to be guilty of an offence by reason of so much of
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any such orders as makes any provision thereof retrospective to any date before the making thereof. (4) Any orders made under this section, whether before or after the appointed day, shall have effect- (a) up to the appointed day, in British India ; (b) on and after the appointed day, in the new Dominion or Dominions concerned ; and (c)outside British India, or, as the case may be, outside the new Dominion or Dominions concerned, to such extent, whether before, on or after the appointed day, as a law of the Legislature of the Dominion or Dominions concerned would have on or after the appointed day, but shall, in the case of each of the Dominions, be subject to the same, powers of repeal and amendment as laws of the Legislature of that Dominion. (5) No order shall be made under this section, by the Governor of any province, after the appointed day, or, by the Governor-General, after the thirty-first day of March, nineteen hundred and forty- eight, or such earlier date as may be determined, in the case of either Dominion, by any law of the Legislature of that Dominion. (6) If it appears that a part of the Province of Assam is, on the appointed day, to become part of the new Province of East Bengal, the preceding provisions of this section shall have effect as if. Under this Act, the ' Province of Assam was to cease to exist on the appointed day and be reconstituted on that day as a new province." In the preamble of the Pakistan (Adaptation of Existing Pakistan Laws) Order, 1947 it was written that the aforesaid Order was being issued in pursuance of the two provisions of law hereinbefore quoted. If read in that way it becomes quite clear that under section 18(3) of the Indian Independence Act the old laws were to continue in…
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