' SYED HAMID ALI SHAH, J.---Petitioner is involved in the business of petroleum exploration and production and enjoys various incentives and concessions by Government of Pakistan. Production of sale of Liquefied Petroleum Gas was regulated under Liquefied Petroleum Gas Rules, 1971 and on repeal, now the sale of L.P.G. Is regulated by Liquefied Petroleum Gas (Production and Distribution)
Rules, 2001. District Government. Attock served upon the petitioner notice, dated 9-4-2005 for the payment of license fee of Rs,1 million, on account of storage and sale of LPG at Khaur. Petitioner's contested the notice, filed written reply and conveyed to the respondent that LPG is Federal subject, under Item No, 2 Part II of 4th Schedule of the Constitution of Islamic Republic of Pakistan, therefore, license fee cannot be imposed. Another notice was served on 12-5-2005, without considering the earlier reply of the petitioner. Hence this petition.
2. It is contended that matters relating to liquefied petroleum gas are Federal subjects under Item No,2 Part II of 4th Schedule of the Constitution and impugned notice, in view of Oil and Gas Regulatory Authority Ordinance, 2002, has no legal sanctity. Petitioner was deprived of the right of hearing. He has referred to the case of "Foundation Gas Limited and 4 others v. Government of Punjab and 2 others"(1992 M LD 499), whereby the impugned levy by the District Government has been declared illegal. Learned counsel further supported his contention by referring to the case of "Zila Council, Jhang, District Jhang through Administrator and others" v. Messrs Daewoo Corporation, Kot Ranjeet, Sheikhupura through Director Contract and others" (2001 SCM R 1012).
' Learned counsel for the respondent, on the other hand, has submitted that under Article 140-A of the Constitution of Islamic Republic of Pakistan, the Province has the authority to establish a Local Government System and devolve upon it the political and financial responsibilities. A Local Government has the authority to claim license fee and a license fee under sections 141, 144 and 145 of the Punjab Local Government Ordinance, 2001, is leviable.
Learned Law Officer has also adopted the line of arguments of learned counsel for the respondent Mr. S.M. Ayub Bukhari, Advocate.
3. Heard learned counsel for the parties and record perused.
4. Zila Council, Attock claimed export tax regarding the fuel and gas, on marketing Liquefied Petroleum Gas (LPG). The Foundation Gas Limited challenged the levy on the ground that natural gas is a Federal subject and it is the Federal Government alone which is competent to legislate about it's distribution and control or to levy tax thereon. It has been held by this Court in the case of Foundation Gas Limited and four others (Supra) that:- "The subject of mineral oil and natural gas has always been Federal subject. In the Constitution of Pakistan, 1956, the subject of mineral oil and natural gas is included as Item No,15 in the Fifth Schedule pertaining to the Federal Legislative List. In the Constitution of Pakistan, 1962 the said subject is included in the Third Schedule vide Item No,24 relating to exclusive powers of the Central Government to make laws. In the present Constitution of 1973, the subject of mineral oil and natural gas; liquid and substance declared by the Federal Law to be dangerously inflammable is included in the Fourth Schedule, Part II, Item 2 relating to the Federal Legislative List. Power to levy taxes on mineral oil, natural gas and minerals for use in generation of nuclear energy also vests in the Federal Government by virtue of Item No,51 in Part II of the Fourth Schedule. As discussed above, LPG is natural gas, hence the Federal Government alone is competent to legislate about its distribution and control etc., or to levy tax thereon."
5. Under the provisions of OGRA Ordinance (Ordinance No,XVII of 2002), the power to grant license for transmission, installation and distribution or sale of natural gas is conferred upon OGRA and these activities can be undertaken only when a license is granted by the Authority (OGRA). The issue has already been resolved in the above referred case, therefore, I will not dilate upon this issue any more and A hold that issuance of license or charging any tax or levy on LPG is a Federal subject, within the meaning of Para.2 Part-II of 4th Schedule of the Constitution of Islamic Republic of Pakistan. Respondent cannot stretch it's jurisdiction and claim the license fee.
6. For the foregoing, this petition is allowed and imposition of licence fee on L.P.G. Is declared without lawful authority and of no legal effect.