' SYED SAJJAD HASSAN SHAH, J.---Through the instant constitutional petition, the petitioners have impugned the levy of tobacco development cess (T.D.C) on the harvests of tobacco crop transported from the Province of Punjab into the limits of D.I. Khan Division on the grounds that it is without lawful authority. They prayed for restraining the respondents concerned from realizing the cess. It is alleged in the writ petition that the T.D.C. Is levied under the Federal Law and in view of this law, the Provincial Government is not authorized to levy, this cess; otherwise, it would amount double taxation. They have prayed for declaring the levy of cess as illegal and without lawful authority.
2. The contesting respondents resisted the plea of the petitioners by filing comments. The, main point taken by them is that the sale of tobacco is regulated by Pakistan Tobacco Board Ordinance, 1968 and the Rules framed thereunder and section 11 of the N.-W.F.P. Province Act, 2004 amended from time to time.
3. Both the learned counsel for the parties submitted their arguments in line with their pleadings.
We have perused the relevant law i,e, N.-W.F.P. Finance Act, 2004. The amended section is reproduced below:--- "6. Amendment of N.-W.F.P. Act I of 1996.---In the North-West Frontier Province Finance Act, 1996 (N.-W.F.P. Act I of 1996), in Section 11,--
(1) in subsection (la). For clause (b), and the Explanation thereunder, the following shall be substituted, namely:- "(b) persons dealing in tobacco business, who purchase tobacco from growers or any other source or transport tobacco to:--
(i) any of the cigarette manufacturing/ re-drying factories, processing centers, in the North-West Frontier Province; or
(ii) any area other than the areas mentioned in clause (i) above: ' Provided that no cess shall be leviable in relation to such quantity of the tobacco for which the cess has already been paid under clause (a): ' Provided further that persons bringing tobacco from any place outside the Province of the North- West Frontier to any place within the said Province shall also be liable to pay the cess at the rate specified in subsection, (1).
' Explanation. ---For the purpose of this section the word "person" used in, this clause shall also include cigarette manufacturing/ re-drying factories, processing centres, these factories/centres are transporting tobacco, as aforesaid, in addition to the quota allocated to them by the Pakistan Tobacco Board. "
(iii) after subsection (la), as so amended, the following new subsection (lb) shall be inserted, namely: "(lb) The cess levied under subsection (1) shall be collected at the entry point of the cigarette manufacturing factories and re-drying factories or, as the case may be, at the check point established for the purpose.
4. It appears from above provision that the cess is levied and collected at the specified rates from the persons, other than tobacco factories, dealing in tobacco business, who are transporting tobacco from Punjab Province to Khyber Pakhtunkhwa. The above Act has been duly passed by the Provincial Assembly. Under the said Act, the Provincial Government has also notified Rules of 2004 which provide the detail of levying and collection of tobacco cess. So, keeping in view the above provision, the tobacco cess is being levied legally. In fact, there are two "levy" i,e, one is Federal levy which is collected by Pakistan Tobacco Board working under the Federal Government and the other one is Provincial levy which is collected by the Provincial Government through excise and Taxation Department. Both these "levy" are controlled under the Federal and Provincial Governments duly promulgated by the respective Governments. There is no question of double taxation and are not violative of Article 151 of the Constitution of Islamic Republic of A Pakistan, 1973.
Moreover, on behalf of the Federal Government, the Pakistan Tobacco Board collects cess called F.T.C. Which is not divisible under Finance Distribution Formula is realized under Pakistan Tobacco Ordinance, 1965 and Rules made thereunder. Therefore, the tobacco cess levied by the Provincial Government would not come. Under the definition of double taxation and not violative of Articles 4 and 148 of the Constitution of Islamic Republic of Pakistan, 1973. We rely upon a case titled Pakistan Tobacco Co. Ltd. v. N.-W.F.P. Through Secretary Law, Government of N.-W.F.P., Peshawar and 9 others (2002 CLC 1910) wherein it is held that:--- "(5) Applying the above principle of interpretation to the present case, we should now refer to the impugned section 11 of the Finance Acts of 1996-97. The plain reading of the sections would indicate that the development cess/tax is levied on the movement of tobacco from certain Districts and is not at all a tax on the sales and purchases. As the wordings of the sections are totally unambiguous, we should not refer to any speech of the Finance Minister because the speech, rather, goes to create ambiguity. The sections a e neither ambiguous nor obscure nor lead to absurdity. We, therefore, hold that the cess/tax is levied on the movement of goods. We have been using the words "cess" and "tax" alternately because as held by our own High Court in Haji Multan Zarin and others v. Government of N.-W.F.P. PLD 1980 Pesh. 137 words "tax" and "cess" are not distinct from each other. The aforesaid ruling is also relied upon by the learned counsel for the petitioners but it is distinguishable, in that, it dealt with a cess which was levied on the sale of marble chips and not on the movement thereof and hence was rightly held to be offending the provisions of Entry 49 read with 59 of Federal Legislative List."
' We also refer to para.6 of the said judgment which reads:--- "(6) Next argument assailing the tax in question was that it was a double taxation and the tobacco companies are subjected to the payment of cess already levied. Syed Zahid Hussain, learned counsel for the petitioner argued that though no prohibition is laid down in the Constitution on double taxation yet it is deprecated by the superior Courts of the country. Case of Kohi Noor Industries v. Government of Pakistan 1989 M LD 1 was relied upon where double taxation was held not permissible but it is also distinguishable because double taxes were imposed under the provisions of the same Act i,e, under section 3(1) of Central Excises and Salt Act. It was held therein that imposition of excise duty on production capacity under section 3(4) of the Act could be only in lieu of and not in addition to the excise duty specified in section 3(1) of the said Act. We could not be convinced as to how in the instant case the provisions of section 11 of the Finance Acts, 1996 and 1997 could be hit by principle of double taxation."
' It is further held in para.14 that: "(14) A close reading of Article 151(3)(b) of the Constitution would clearly suggest that a Provincial Assembly or Government is restrained from imposing tax which discriminates between goods manufactured or produced in the Province and goods not so manufactured or produced outside the Province. The imposition of tax is also allowed when it does not discriminate between the goods manufactured or produced outside the Province and the goods manufactured or produced in any area in Pakistan. We would like to further explain the point of discrimination in giving the example of tobacco. ' Had the tobacco not been produced in the Province of Punjab and had it only been produced in the Province of North-West Frontier, the imposition of tax on the movement thereof from N.-W.F.P. To the Punjab Would have certainly attracted the prohibition and would have been un-constitutional. Had the tobacco been exported to many other Provinces but the imposition of tax been restricted to one Province alone, it would have discriminated between the other two Provinces and would have been un-constitutional. In the instant case the tobacco is also produced in the Province of Punjab and hence the prohibition contained in Article 151(3)(b) of the Constitution is not at all attracted. The logic behind this legislation is obvious because had the tobacco not been produced in Punjab, it would have been a restriction towards the freedom of trade throughout Pakistan. Distinguishing the aforesaid ruling given in the case of Sapphire Textile Mills and strictly taking the matter out of the discrimination aimed at by sub-Article (3)(b) of Article 151 of the Constitution, we hold that the imposition of tax on movement of tobacco from N.-W.F.P. To the Punjab is not violative of Article 151 of the Constitution. It does not in any way cause discrimination alluded to and prohibited by Article 151(3)(b) of the Constitution."
5. Another fact to be noted is that the petitioners have pleaded the tobacco cess is double taxation which means that they have also impugned the "Federal Levy" being collected by Pakistan Tobacco Board, hence, the Pakistan Tobacco Board is necessary party which is not impleaded in this writ petition, which is a defect.
6. Moreover, it appears from the contents of writ petition and prayer made therein that the petitioners have impugned the N.-W.F.P. Finance, 2004 but they have not challenged it. This has also made the maintainability of writ petition as doubtful.
7. As discussed above, the levy of Tobacco Development Cess D (T.D.C.) is quite in accordance with the provisions duly regulated by Finance Act, 2004. We also rely on PLJ 2002 SC 625 (sic) and PLD 2005 Karachi 55.
8. In view of above discussion, this writ petition has no substance E which is hereby dismissed.