' NASIR-UL-MULK, J.--- The petitioner is a Company which has set up a hospital of 500 Beds on a plot in Sector H-8/4, Islamabad, allotted to it by the Capital Development Authority (C.D.A.) in July, 1988. The respondent (C.D.A.) issued notices in the year, 2000 to the petitioner for payment of property tax at the rate fixed for levy of the tax on commercial plots. These notices were challenged by the petitioner before the Rawalpindi Bench of the Lahore High Court by means of constitutional petition on the ground that the petitioner was liable to pay property tax as an "Institution", for which it was allotted the plot. The writ petition was disposed of in the terms that the petitioner was directed to first of all avail the statutory remedy by moving the Director Revenue C.D.A. For the redressal of its grievance. Failing to obtain relief from the administrative hierarchy of the Capital Development Authority, the petitioner once again approached the Court by filing constitutional petition before the Islamabad High Court. The petition was dismissed on 3-3-2009 from which the petitioner filed the present petition for leave to appeal.
2. Mr. Zaheer Bashir Ansari, Advocate Supreme Court appeared for the petitioner. We issued notices to the respondents in order that we may be assisted on the legal points raised by learned counsel for the petitioner as well as on certain factual aspects. Mr. Afnan Karim Kundi, Advocate Supreme Court appeared for the respondent (C.D.A.).
3. The petitioner claims that the plot allotted to it is one of the plots reserved for 'special institutions' under Regulation 3(4) of the Islamabad Land Disposal Regulation, 1993. That accordingly the property tax used to be charged under S.R.O. No,805(I)/91 from the petitioner at the rate prescribed for 'Institutions'. It was pointed out that the commercial plots were separately categorized and different higher rates of property taxes prescribed therefor. That the said S.R.O. Was superseded by S.R.O. No,24(I)/2001 dated 12-1-2001 whereby the plots for the purpose of tax were split into two categories, residential and commercial. It was pointed out that even under the latter S.R.O., the petitioner's plot did not fall under the commercial category. However, by an amendment through S.R.O. No,783(I)/03 dated 9-8-2003. Nonresidential properties, outside the commercial areas, were included in the commercial category, and it was on the strength of this amendment that the impugned notices were issued. The learned counsel argued that since the plot allotted to the petitioner was categorized as an 'Institutional Plot' under the Islamabad Land Disposal Regulations, 1993 and its nature had been changed, the Capital Development Authority was not empowered to bring the petitiondr's plot under the category of commercial plots for the purpose of taxation.
4. Responding to the above contentions, the learned counsel for the respondents brought to our notice that the petitioner has' already paid the entire tax now under challenge. Referring to Mrs. Bilquis Anwar Khan v. Pakistan through Secretary, Cabinet Division Government of Pakistan, Islamabad and others 2001 SCM R 809, the learned counsel argued that this Court had already acknowledged the power of the Capital Development Authority to impose and bring about changes in the rates of property tax. It was submitted that admittedly the petitioner was running the hospital for profits and that it was included in commercial category so as to bring at par with those private hospitals set up on commercial plots.
5. The dispute arises out of the interpretation of certain provisions of two sets of notifications, one issued under section 51 read with section 49 of the Capital Development Authority Ordinance, 1960 (hereinafter referred to as 'Ordinance of 1960') and the order under section 15-A of the Ordinance.
Section 51 empowers the Capital Development Authority (C.D.A.) to make Regulations necessary or expedient regarding any matter provided for in the Ordinance, whereas Section 49 titled as "Power to Dispose of Land" provides that "the Authority may retain, lease, sale, exchange, rent or otherwise dispose of any land vested in it". In exercise of these powers, the Capital Development Authority issued the Islamabad Land Disposal Regulation, 1993, dated 18th December, 1993, making classification of plots in Islamabad into Residential, Commercial and Business Plots, Community Buildings and Facilities Plots, Administrative Building, Public Offices and Industrial Plots etc. The Regulation laid down the procedures for the disposal of these different categories of plots. The Regulation of 1993 has now been substituted by the Islamabad Land Disposal Regulations, 2005 and although certain other changes have been brought about, the category of Community Buildings and Facilities Plots remain the same.
6. Section 15-A of the Ordinance under which the second set of notifications were issued provides as under:-- "(1) During such period and for such areas within the Islamabad Capital Territory as the Central Government may by notification in the official Gazette, specify, the Authority may, notwithstanding anything contained in any other law for the time being in force, exercise, and perform such powers and functions as a Municipal Committee may exercise and perform in relation to a Municipality under the Municipal Administration Ordinance, 1960.
(2) For the purpose of subsection (1), the provisions of sections 18, 33 to 73, 77 to 106, 109, 115 to 118 and 122 of the Municipal Administration Ordinance, 1960, and the Second Third and Fifth Schedules thereto shall, so far as may be, apply to the Islamabad Capital Territory as they apply to a municipality, references therein....... "
' Before the exercise of powers under section 15-A The Capital Development Authority had by S.R.O.806(1) of 1991 under Rule 6(1) of the Capital Development Authority (Imposition of Taxes) Rules, 1981 levied property tax in Islamabad at different rates for the different categories of plots. The Capital Development Authority (Imposition of Taxes) Rules, 1981 were made by the Federal Government in exercise of the powers conferred under section 50 read with section 15-A of the Ordinance, 1960. Category 'AM' relating to Industrial / Institutional Plots and Commercial Plots, with higher rates of tax, were separately categorized. The next notification in line, was issued on 21st June, 1995 in exercise of powers conferred upon the Capital Development Authority under section 15-A of Ordinance, 1960 and read with sections 33 and 34 of the Municipal Administration Ordinance, 1960, and Capital. Development Authority (Imposition of Taxes) Rules, 1981. This did not bring about change regarding imposition of tax as far as the petitioner was concerned. Under the same powers, the C.D.A. Issued another notification on 12-1-2001 wherein for the purpose of taxation the plots were broadly categorized as Residential and Commercial. Each category was further subcategorized with different rates of taxes. The petitioner's plot was not included in the commercial category. However, an amendment was made in the said notification by notification dated 9th August, 2003 by making addition to Sr.No,3 of category (B)-Commercial of the table of the notification of 12 the January, 2001. The original reads as followst-- Rating Areas and CategoriesPlot Area Per Sq.Yd.Covered Area per Sq.ft.
1. 2. 3.
(A) Residential 1.. ------
2. ------
3. ------
4. I-Series
(a) Plot and area upto 356 Sq.yds2.00 3.00
(b) Plot area more than 356 Sq.yds3.00 4.50
(B) Commercial
1. ------
2. ------
3. Markaz G and I Series, I and T Centre/Class"
III Shopping Centres3.50 5.50 ' The Notification of 9th August, 2003 added "and non-residential properties outside commercial area" to Sr.No,3 of category (B). By this amendment, the petitioner's property was brought under the commercial category and consequently, subjected to higher rate of tax.
7. The petitioner's main reliance is upon the categorization of its plot as 'Institutional Plot' under' the Islamabad Land Disposal Regulations, 1993. This Regulation and its replacement, Islamabad Land Disposal Regulations, 2005, were made for the purpose of laying down procedure for the disposal, by lease, sale, exchange etc. Of different categories of the lands in the Islamabad Territory by the Capital Development Authority. The object of categorization under these Regulations was to provide different modes for the disposal of each category and not for the purpose of taxation. For the purpose of taxation the categorizations have been provided in the notifications issued by the Capital Development Authority in the exercise of its powers conferred by section 15-A of the Ordinance, 1960 read with sections 33 and 34 of the Municipal Administration Ordinance, 1960. The C.D.A. Is empowered to make its own categorization of plots under these powers for the purpose of taxation, which may be different than the classification provided in the Islamabad Land Disposal Regulation. Thus a plot classified as residential in the Regulations may be brought in the category of commercial for the purpose of taxation. In this view of the matter, no exception can be taken to the inclusion for, the purpose of levy of tax at commercial rates on "non-residential properties outside commercial areas".
8. Though located in a non-commercial area, admittedly, the petitioner, is a profit making concern.
The inclusion of the petitioner in the tax net for commercial properties is based on the nature of its activities. Such inclusion cannot be termed unreasonable as the petitioner is now being brought at par with the other private hospital located in commercial areas already subjected to tax at commercial rates.
9. For the foregoing reasons, we do not find any merit in this petition, which is consequently dismissed and leave declined.