1. ' SAIYED SAEED ASHHAD, C.J.---In this Constitutional petition, the petitioner have sought the following reliefs:--
(1) Direct respondents Nos.1 and 2 to exempt the petitioner-Corporation from the. Deduction of Zakat.
(2) Declare that the inclusion of the petitioner-Corporation as a Sahib-iNisab person under section 2(xxiii) of the said Ordinance for the purposes of the deduction of Zakat is unlawful and ultra vires of Articles 1-A, 4 and 25 of the Constitution.
(3) Direct respondent No.4 to refund Rs.3,707,414 deducted as Zakat on the N.I.T. Units, and any other amount so deducted till final disposal of this petition.
(4) Direct respondent No.3 to stop deducting Zakat on the N.I.T. Units held by the petitioner.
(5) Grant the cost of the petition.
(6) Grant such other relief as this ' Honourable Court may deem fit in the circumstances.
2. ' The brief facts as stated by the petitioner in the memo. Of petition are that the petitioner is a statutory Corporation established under the Pakistan Insurance Corporation Act (XXXVII of 1952), 51% of the equity of the petitioner-Corporation is held by the Federal Government while the other 49% shares are held by general public including the petitioner which held approximately 28% of the shares. It was further stated by the petitioner-Corporation that it made huge investment in N.I.T.
3. Units since 1980 on which it used to receive annual dividends, which were not subject to payment of Zakat from 1980 to 1983. However, later on in 1984 respondent No.3 deducted Zakat at the rate of 2.5% of the face value of the N.I.T. Units held by the petitioner. The petitioner further stated that they being a statutory Corporation were not liable to payment or deduction of Zakat, but in spite of the above respondent No.3 continued to deduct Zakat on the N.I.T. Units held by the petitioner. The stand of the petitioner was that they were not Sahib-i-Nisab as defined in section 2(xxiii) of the Zakat and Ushr Ordinance, 1980 (hereinafter referred to as the "Ordinance of 1980"). They further submitted that on further pressing the matter, respondent No.3 informed the petitioner that they had referred the matter to respondent No.4 who informed the petitioner that their case was not covered by the exemption on the ground that Pakistan Industrial Credit Investment Corporation, a statutory Corporation was being subjected to compulsory deduction of Zakat on the N.I.T. Units held by it vide directions of the Administrator General dated 9-9-1980. The petitioner further submitted that the interpretation of the relevant provisions of the Ordinance of 1980 by respondents Nos.3 and 4 was unlawful and incorrect as a statutory Corporation, irrespective of the fact that it was wholly, or partly owned by the Federal Government or Provincial Government or a Local Authority was exempt from payment of Zakat as the petitioner were neither a Sahib-i-Nisab nor a natural person in accordance with Shariah, but to no avail. The petitioner haying no other adequate, efficacious and alternative remedy were forced to invoke the Constitutional jurisdiction of this Court. Hence this Constitutional petition.
4. Parawise comments were filed, on behalf of respondent No.1, wherein the stand taken was that the .Petitioner- Corporation was not wholly owned directly or indirectly by the Federal Government as it held only 51% shares while the remaining 49% shares were held by the general public and other Corporation etc. It was submitted that the definition of Sahib-i-Nisab given in section 2 (xxiii) of the Ordinance of 1980 included even a Corporation and no deduction of Zakat during the years 1980 to 1983 was on account of a mistake on the part of the Zakat Collection Office. It Was further submitted that. The mistake on the part of the Zakat Collector Office is not deducting the Zakat for a particular period would not exempt. The petitioner from the deduction of Zakat in future. It was further .Submitted that the petitioner never applied for exemption from deduction of Zakat by providing documentary evidence to establish that they were excluded from the definition of Sahib- i-Nisab as required by Rule 21 of the Zakat (Collection and Refund) Rules, 1981. They admitted that payment of Zakat was liable only by a Sahib-i-Nisab but denied that treating the petitioner as Sahib-i-Nisab was unlawful or ultra vires of the Sharia or Article 2-A of the Constitution of Islamic Republic of Pakistan. It was further submitted that for claiming exemption from liability of paying Zakat on its assets a statutory Corporation must fulfil the conditions laid down in sub-clause (b) of clause (xxiii) of section 2 of the Ordinance of 1980, which required that the Corporation should be wholly owned, directly .Or indirectly by the Federal Government, Provincial Government or a Local Authority either singly or jointly with one or with more of the others, which was not the case of the petitioner as only 51% of the shares were held by the Federal Government. It was prayed on behalf of respondent No.1 that the petition was without substance and deduction of Zakat from the N.I.T.
5. Units held by the petitioner was in accordance with the provisions of Ordinance, 1980 not resulting in any illegality or irregularity and the petition was liable to be dismissed.
6. ' We have heard the arguments of Mr. Muhammad Farid, Advocate on behalf of the petitioner, Mr. Niaz Ahmed, Advocate on behalf of respondents Nos.1 and 2 and Mr. Sajjad Ali Shah, the learned Standing counsel on behalf Of the Federation of Pakistan, Mr. Ahmed Pirzada, learned Addl. A.-G.
7. Sindh was present on Court Notice. We have also perused the relevant provisions of law material on record.
8. ' The issue involved in this Constitution'al petition is whether the petitioner-Corporation comes within the definition of Sahib-i-Nisab as defined in section (xxiii) of the Ordinance of 1980 so" as to be liable to deduction of Zakat on the N.I.T. Units held by it. Mr. Muhammad Farid and Mr. Niaz Ahmed, Advocate advanced their respective arguments which were to the same effect as ' the facts narrated above on behalf of the petitioner in their memo. Of petition and the facts/objections raised by respondent No.1 in the comments filed on his behalf. Mr. Niaz Ahmed emphatically submitted that exemption from deduction of Zakat on its assets could oe claimed by a statutory Corporation which was wholly owned by the Federal Government, a Provincial Government or a Local Authority or jointly with one or more of the others which meant that the entire shares should belong to the statutory Corporation which was not the case with the petitioner-Corporation as the Federal Government did not own entire 100% shares of the petitioner-Corporation but held only 51 % shares as a result of which it could not be said that the petitioner-Corporation was wholly owned by the Federal Government. The contention raised by Mr. Muhammad Farid, Advocate was that in determining whether a statutory Corporation was covered by the definition of Sahib-i-Nisab the important factor to be decided was whether the majority shares of which was owned or the beneficial ownership of Which was held by Muslim citizens and that in the case of the petitioner- Corporation the majority shares were not held by Muslim citizens nor the beneficial ownership was held by them as admittedly 51 % shares were held by the Federal Government and as Muslim citizens were not deriving majority benefits were not having beneficial ownership, the petitioner- Corporation did not come within the definition' of Sahib-i-Nisab. In support of his above contention he placed reliance on the case of Bank of Punjab v. Administrator General, Central Zakat Administrator, Islamabad and 3 others PLD 1994 Lah.
207. In this case the question before the Lahore High Court was whether Bank of Punjab wherein more than 60% of the equity/shares was owned and held by the Provincial Government would be covered by the definition of Sahib-i-Nisab as given in the Ordinance of 1980 so as to be subjected to payment of Zakat on the N.I.T. Units held by it. The Lahore High COurt after taking into consideration and examining the provisions of the Ordinance of 1980 made the following observations:-
(1) "The Legislature while defining the term 'Sahib-i-Nisab' has used the word 'means' which shows that the definition given is unhaustive and no other meaning is to be assigned to the expression than is put in the definition subject, however, to the condition that there is anything repugnant in the subject or context. But at the same time the Legislature has used the words, does not include'.
9. These words indicate that the Governments, bodies, companies, statutory Corporation, funds or the persons mentioned in clauses (a) to (n) are not to be taken to be falling within the definition of the term 'Sahib-iNisab'. The omission of a particular Corporation, company or association of persons etc. From clauses (a) to (n) would not necessarily mean that the same necessarily fall within the definition of the term `Sahib-iNisah'. The question whether or not a company or statutory Corporation, or body of persons, falls within the ambit of the term `Sahib-i-Nisab' has to be answered by examining the meaning assigned to the term and with reference to the other provisions of the Zakat and Ushr Ordinance, 1980. This brings us back to the main definition of the term 'Sahib-iNisab' which is to the effect that "a person who owns or possesses assets not less than `nisab-. The term 'person', however, has not been defined in this Ordinance.
10. According to section 329 of the General Clauses Act, 1898, a `person' shall include any company or association or body of individuals whether incorporated or not. So a juridical person also falls within the ambit of the term `person' but it is to be noted that a person natural or juridical has to be one to whom or to which the Zakat and Ushr Ordinance applies and the assets owned or possessed by him are those assets which under Sharia are liable to Zakat as the term `nisab' so provides. This conclusion stands fortified from the provisions of section 3 as well which provides that Zakat in respect of 'assets mentioned in the First Schedule shall be charged and collected on compulsory basis in each Zakat year at the rates and in manner specified therein subject to provisions of this Ordinance'. The other provisions which is relevant is contained in subsection (2) of section 1 of the Ordinance for the purpose of finding out a person natural or legal/juridical who are which is liable to pay Zakat on compulsory basis."
(2) "It is apparent from very perusal of subsection (2) quoted above, that a company or other association of persons or body of individuals whether incorporated or not, majority of the shares of which is owned or the beneficial ownership of which is held by Muslim citizens, falls within the purview of the Ordinance. Thus, subject to other provisions of the Ordinance which have created certain exceptions, Zakat is payable by the following two categories of persons:---
(i) Muslim citizens of Pakistan;
(ii) a company or other association of persons etc. Majority of the shares of which is owned or the beneficial ownership of which is held by Muslim citizens.
11. ' It, therefore, follows that in case of those companies or association of persons, the majority of the shares of which is not owned or the beneficial ownership of which is not held by Muslim citizens, the Zakat and Ushr Ordinance does not apply to them and the question of charging and collecting Zakat from their assets on compulsory basis does not arise. In this view of the matter, omission of such company, the majority of shares of which is held by a Government, from the exclusion 'clause of the term `Sahib-i-Nisab' would not make any difference. This interpretation is in accord with the consensus of the Muslim Jurists."
12. ' Upon the above observations the Lahore High Court made the following pronouncement:-- "For these reasons, it is held and declared that Zakat and Ushr Ordinance, 1980 does not apply to the petitioner-Bank and as such the investment made in the N.I.T. Units with National Investment Trust respondent is not liable to compulsory deduction of Zakat. As a consequence of the above declaration, the N.I.T. Units Trust respondent is restrained from deducting Zakat from N.I.T. Units and the respondents are further directed to refund the amount of Zakat on N.I.T. Units which was kept in .a separate account to the petitioner-Bank. The petition stands accepted."
13. ' The case of the petitioner-Corporation is bn the same footings as that of Bank of Punjab in the cited case, 51% of the shares of the petitioner-Corporation are held by the Federal Government, therefore, it cannot be said that the majority of the shares or the beneficial ownership of the petitioner-Corporation is held by Muslim citizens so as to be covered by the definition of Sahib-i- Nisab. The pronouncement made by the Lahore High Court is applicable on all fours to the facts of this case. Mr. Niaz Ahmed was unable to advance any cogent or plausible ground in support of his contention that the observations made and the judgment pronounced by the Lahore High Court were not applicable to the facts of this case except the fact that in the cited case Provincial Government held more than 60% of the equity/shares, whereas in the present case the Federal Government held only 51% of the equity/shares of the petitioner-Corporation. Be that as it may, the fact is that the Federal Government held the majority shares and Muslim citizens were not holding the majority shares or beneficial ownership of the petitioner-Corporation so as to bring the same within the definition of Sahib-i- Nisab.
14. For the foregoing reasons and discussions we find that this Constitutional petition merits consideration and is allowed. It is declared that the petitioner do not come within the definition of Sahib-iNisab and respondents Nos. 3 and 4 National Investment Trust Ltd. And National Bank of Pakistan as well as respondent No.1 Administrator General Zakat are not entitled to deduct Zakat on the N.I.T. Units held by the petitioner-Corporation and they are restrained from deducting Zakat from the said N.I.T. Units. The above respondents are further directed to refund the amount of Zakat deducted by them on the N.I.T. Units from 1980 to 1983. The parties are left to bear their own costs.