MUHAMMAD ATHAR SAEED, J.---This petition for leave to appeal has been filed impugning the judgment of the learned Judge in Chambers of the Peshawar High Court, Peshawar dated 25-11- 2010 passed in Writ Petition No,945 of 2009 whereby the learned Judge in Chambers has allowed the petition filed by the present respondent challenging the applicability of the notification No,SO(Tech)ED/V544/2044/KC/1203-28 dated 16th February, 2005 whereby the forest duty on timber imported/brought from Afghanistan was fixed at Rs,90 per cft. And the forest development charges were also levied at the following rates:- "Rs,10 per Cft on deodar; Rs, S per Cft on Kail; and Rs, 6 per Cft on Fir/Spruce."
2. Brief facts of the case are that present respondent is an importer who brings/imports timber from Afghanistan which was earlier allowed to be imported through FATA route by charging forest duty @ Rs,40 per cft. The present responder applied to the Government to allow him to import such timber from Bin Shahi route which was initially regretted by the present petitioners i,e, Government of KPK against which the present respondent filed Writ Petition No,693 of 2002 before the Peshawar High Court, praying that government may be directed to allow him to bring timber from Afghanistan through Bin Shahi route and the learned Peshawar High Court disposed of this writ petition on the production of the new approved policy dated 16-3-2003 whereby the import of timber from Afghanistan to Pakistan through Bin Shahi route was allowed as per order of the Court dated 22-10-2003. The respondent then applied for permission to import Afghanistan origin timber to Pakistan through Bin Shahi route and also furnished undertaking to the department on 26-4- 2004; and also paid the forest duty @ Rs,90 per cft. On such import. He, however, filed Writ Petition No,327 of 2005 challenging the levy of the duty @ Rs,90 per cft. Instead of Rs,40 per cft. Which was in vogue at that time and this petition was disposed of vide judgment dated 3-2-2009 and the following directions were given to the petitioners:-- "Therefore, respondent No,1 is directed to decide the representation of the petitioner positively, within a period of one month after hearing both the parties but strictly according to law, rules and practice and procedure of rules of propriety."
' In compliance to this direction the impugned notification mentioned earlier was issued and the petition which has been disposed of vide the impugned judgment was filed challenging the notification levying forest duty @ Rs,90 per cut. On timber brought/imported through Bin Shahi route which was allowed Hence this petition for leave to appeal.
3. We have heard Mr. Naveed Akhtar, learned Additional Advocate-General KPK for the petitioners and Mr. Imtiaz Ali, Advocate Supreme Court learned counsel for the respondent.
4. The main contention of the learned Additional A.-G. Is that Bin Shahi route was an unauthorized route and during the pendency of the first writ petition it was decided to allow the present respondent to bring timber from Afghanistan through this route and the policy dated 16-10-2003 was formulated for this purpose. According to the learned Additional A.-G. As per Para 11 of this policy the charges of forest duty and forest, development fund on timber brought from Afghanistan Through Bin Shahi route were specified. This Para reads as under:--{{TABLE TEXT}} .
"Timber being carried out from Afghanistan will be charged as under:- i. (i) Forest duty = Rs. 90 per cft. i. (ii) Forest Dev.Fund = Rs. 10 per cft for Deodar, Rs. 8 per cft for kail, Rs. 6 per cft for Fir/Spruce.
' In addition, customs duty will be recovered at the prevailing rate by Customs Department. The owners of Afghan timber will be personally responsible in this behalf. "
' He stated that the present respondent applied for bringing timber in Pakistan in accordance with such policy and also filed the undertaking on 26-4-2004 whereby in Para 6 he had undertaken that payment of duty at the specified rate i,e, Rs,90 per cft. And development charges for different types of timber shall be paid by him on the basis of this undertaking. He was allowed to import timber from Afghanistan in Pakistan through Bin Shahi route on the payment of duty as per the undertaking. He, further argued that the present respondent after giving the undertaking that he will pay the duty as per the policy and actually paying the duty before the timber was allowed to be brought in Pakistan was hit, by the doctrine of Estoppel and was estopped from challenging the levy of the duty etc. However, he filed fresh petition i,e, W.P. No,327 of 2005 before the High Court and the Court had disposed of the same with the directions as stated hereinabove. The learned Additional A.-G. Then argued that since there was no duty prescribed for timber being brought in Pakistan through Bin Shahi route, therefore, in compliance with the direction of the learned High Court, the notification dated 16-2-2005 was issued which was to come into effect from 16-1-2004 in accordance with the policy issued on 16-10-2003. He stated that the effect of the notification was not retrospective but it was only to give it effect from the date which had already been prescribed under the scheme and duty already collected at this rate on the timber being brought in Pakistan through Bin Shahi route. He further submitted that impugned judgment is based on misreading of the facts of the case and the law on the subject. He, therefore, prayed that the judgment of the learned High Court may be set aside and the writ petition filed by the present respondent may be dismissed.
5. The learned A.A.-G also filed a comparative statement of the schedule of the duties being collected on timber being brought through the FATA route and the duties being collected on the timber being brought through the Bin Shahi route. This schedule is being reproduced below :- {{TABLE TEXT}} "11. Comparative statement showing taxes and Forest Duties:--
(A) Under FATA policy.
(i) Permit fee of political Agent= Rs.20,000
(ii) Forest Development Fund by PA.= Rs.8,000
(iii) Forest Duty by Forest Department= Rs.24,000
(iv) FDF by Forest Department = Rs.6,000
(v) Golden Jublee by Forest Department= Rs.18,00 For 600 cft. Which work out Rs,99.66 per cft. Or say = Rs,100
(B) Under N.-W.F.P. Provincial policy:- i. Forest duty = Rs. 90 per cft. i. Forest Development Fund = Rs. 10 per cft. Total= Rs. 100 per cft."
' On the basis of this schedule he argued that gross collection made is almost the same in both these cases.
6. The arguments of the learned Additional A.-G. Have been vehemently opposed by the learned counsel for the respondent who supported the impugned judgment and stated that it was an unexceptionable judgment in which the facts have been properly considered and decided on the basis of settled law. He submitted that Provincial Government derives its power of levying forest duty under section 56 of the N.W.F.P. Ordinance Forest, .2002 (hereinafter referred to as 'the Ordinance') wherein it has been provided that the Government may by notification, levy a duty or forest development charges, or both, in such manner at such places and at such rates as may be prescribed on any timber or other forest produce which is produced in the Province or brought from any place outside the Province, or is transported from or through any place within the Province or from beyond the frontier or elsewhere. He submitted that there is no power with the Government to levy duty through a notification retrospectively. He further submitted that Government does not have any power or authority to prescribe the rates of the duty through a policy as was done by executing the policy dated 16-10-2003 and the Government has itself candidly admitted this ground by issuing the notification dated 16-2-2005 and tried to give it effect from an earlier date which is not in accordance with the settled law. He further submitted that superior Courts have consistently held that the notification cannot be given retrospective effect and vested right accrued cannot be taken away retrospectively by a notification. He relied upon the judgments earlier relied on before the learned Peshawar High Court in this case i,e, Chief Administrator Auqaf v. Mst. Amina Bibi (2008 SCMR 1717), Mst. Umatullah v. Province of Sindh (PLD 2010 Karachi, 236), Muhammad Ashiq v. Chief Administrator of Auqaf (PLD 1977 SC 639), Muhammad Suleman v. Abdul Ghani (PLD 1978 SC 190), Mina Musarat Shah v. Government of West Pakistan (PLD 1974 Peshawar 18), Imtiaz Ahmad v. Punjab Public Service Commission (PLO 2006 SC 472), Commissioner of Sales Tax v. Messrs Kruddsons Ltd. (PLD 1974 SC 180), ANOUD Power Generation Ltd. v. Federation of Pakistan (PLD 2001 SC 340), Messrs Army Welfare Sugar Mills Ltd. v.
Federation of Pakistan (1992 SCMR 1652) and Messrs Pfizer Laboratories Ltd. v. Federation of Pakistan (PLD 1998 SC 64)."
7. The learned counsel read out the provisions of the impugned notification and pointed out that this notification was an amendment and addition to the departmental notification No SOFT: I (FFD)/V-221/73 dated 12-7-1994. He then referred to the notification No SOFT-I (FFW) V-105/99 dated 18-9-1999 to show that the earlier notification which has been mentioned in this impugned notification was also mentioned therein and through this notification the forest duty was enhanced from Rs,20 per cut. To Rs,40 per cut and till the issuance of impugned notification, notification dated 18-9-1999 was in field whereby the forest duty was being levied at Rs,40 per cut and till the issuance and publication of the impugned notification in the official gazette which was published on 5-5-2005 the notification dated 18-9-1999 issued earlier was in field and the respondent was liable to pay forest duty @ Rs,40 per cut. He, therefore, prayed that petition being without merit may be dismissed.
8. The learned Additional A.-G. Rebutted the contentions of the learned counsel for the respondent and stated that notification' issued was specific for the import of the timber through Bin Shahi route as this route was not an approved route and no duty had been prescribed for this route.
9. We have examined the petition in the light of the arguments of the learned counsel and have carefully perused the records of the case including the impugned judgment and the scheme prescribed by the Government and the law on the subject including the notification dated 16-2- 2005.
10. Section 56 of the Ordinance is the charging section which is reproduced below as it is one of the main ingredients of the subject-matter of this petition:-- "56. Duty and forest development charges on timber and other forest produce--(l) Government may, by notification, levy a duty or forest development charges, or both, in such manner at such places and at such rates may be prescribed on any timber or other forest produce which is
(a) produced in the Province, or
(b) Brought from any place outside the Province, or is transported from or through any place within the Province, or from beyond the frontier or elsewhere.
(2) In every case in which such duty or forest development charges, or both, are directed to be levied ad valorem. Government may fix, by notification, the value on which such duty or forest development charges or both, shall be assessed.
(3) All duties on timber or other forest produce listed in Schedule-I and all forest development charges, or both, which at the time when this Ordinance comes into force, are levied therein under the authority of Government shall be deemed to have been duly levied under the provisions of this Ordinance: Provided that the fees and Forest development charges so levied shall not exceed in any case a fair estimate of twenty five per Cent of the average market price realizable on the sales.
(4) The amount realized from duties and forest development charges shall be credited to the Forest Development Fund."
' A perusal of the above section leads to the conclusion that the Government has been empowered to levy forest duty by a notification. The relevant notification which was in force at the time, the respondent applied to the government to allow him to bring timber from Afghanistan through Bin Shahi route was notification No SOFT:I (FFD)/V-221/73 dated 12-7-1994 as amended by notification No SOFT-I (FFW) V-105/99 dated 18-9-1999 but since at the time of the application made by the respondent, Bin Shahi route was not opened for bringing timber in Pakistan therefore he was not allowed to bring timber through this route and when the respondent filed petition before the learned Peshawar High Court, the Government formulated a policy for transport/carriage of timber via Bin Shahi route from Afghanistan on 16-10-2003 and in this policy vide para 11 it was mentioned that certain duties will be charged. This para has already been reproduced hereinabove.
11. The petitioner once again filed a petition before the learned Peshawar High Court who directed the present petitioners to decide present respondent's representation within a month in accordance with law and in compliance to these directions the Government rejected the representation. In the meantime the Government had also issued notification No,SO(Tech)ED / V- 544 / 2044 / KC / 1203-28 dated 16th. February, 2005 which reads as under:-- "No,SO(Tech)ED/V-544/2004/KC/1203-28---In exercise of the Powers conferred by section 56 of the North-West Frontier Province Forest Ordinance, 2002 (N.-W.F.P OR No XIX of 2002) Government of North-West Frontier Province is pleased to direct that in this Department's Notification No SOFT-I (FFD)/V-221/73 dated 12-7-1994 and SOFT:I (FFW)/V105/99/7640-49 dated 18-9-1999, the following sub-item is added, in schedule-I after serial No 1(a) namely:-- Discription of timber/firewood and other forest produceRate of Duty
(b) Coniferous timber imported/ brought from Afghanistan via Bin Shahi.(i) Rs. 90 per cubic foot.
(ii) Forest Development Charges at the rate given below:- Rs. 10 per Cft.on deodar; Rs. 8 per cft.on Kail, and Rs. 6 per cft. On Fir/spruce ' This notification provided the levy of the forest duty @ Rs,90 per cut and also provided an addition to S.No,1 of notification No SOFT:I (FFD)/V-221/73 dated 12-7-1994 and SOFT:I (FFW)/V-105/99/7640- 49 dated 18-9-1999, levying enhanced duty on timber imported/brought via Bin Shahi route. This notification was given effect from 10-1-2004.
12. Being aggrieved by this notification, the respondent once again filed a petition before the learned Peshawar High Court seeking following reliefs:- "I. Declare the impugned policy of respondent No, 1 dated 16-10-2003 is without lawful authority and of no legal effect.
II. Declare the impugned policy as unreasonable, discriminatory and illegal to the extent of imposition of forest duty at the rate of Rs,90 per cut. III. Declare that the notification dated 5-5-2005 as illegal and ultra vires to the Constitution and the fundamental rights of the petitioner. IV. Declare that the petitioner is/was liable to pay similar amount of Rs,40 per cut. As forest duty on importation of timber from Afghanistan through Bin Shahi.
V. Declare Respondent to refund the forest duty paid/exacted from the petitioner in excess of Rs,40 per cut. And the amount of Rs' One Million held as security by the respondents.
' Any other remedy deemed appropriate in the circumstances but not specifically asked for may also be granted, graciously." and this petition was allowed vide impugned judgment.
13. A perusal of the impugned judgment leads to the conclusion that the learned Peshawar High Court has very ably dealt with the basic issues i,e, whether forest duty can be levied by a policy of the Government; whether any undertaking given by the respondent can act as an estoppel and prevent him from seeking legal remedy and whether the notification issued in exercise of the powers under section 56 ibid can be given retrospective effect. After examining the precedents of this Court on the subject the learned court came to the conclusion that notification cannot be given retrospective effect and even if an undertaking has been given under mistake of fact or law and the excess amount has already been paid, it can be recovered from the Government and also that it is settled. Law that tax/duty can only be levied strictly in accordance with IC and within the parameters of the statute by which such charge is to be levied and after having been satisfied that it has been held by the judgments examined by the Court that notification levying or enhancing the duty with retrospective effect cannot be given effect to as it will impair the vested rights which the taxpayer has acquired in accordance with the provisions in force at the time the notification had come into effect, the learned Peshawar High Court allowed the petition.
14. We find ourselves in full agreement with the judgment of the learned Peshawar High Court. It is a trite law as already been stated above that the, charge of tax/duty should be made strictly in accordance with the parameters provided in the charging section which in the present case is section 56 of the Ordinance which empowers the government to levy forest duty by issuance of notification and therefore the enhanced forest duty levied by the policy issued by the government on 16-10-2003 for brining timber through Bin Shahi route is of no legal effect and IF cannot be implemented.
15. It has been held by this Court in its judgment in the case of Messrs Army Welfare Sugar Mills Ltd.
Quoted supra that "instructions by Central Board of Revenue and Budget Speech of the Finance Minister cannot be equated with a legislative instrument sufficient to take away a vested right, if any" and in the present case at the time the present respondent had brought timber through Bin Shahi route the levy of forest duty was Rs,40 per cft. In accordance with the notification No SOFT-I
(FFW) V-105/99 dated 18-9-1999 which was in force at that time and therefore the present respondent had acquired a vested right to pay the duty at the rate which had been specified at Rs,40 per cft. And the policy cannot take away this vested right.
16. At this juncture we have carefully examined the comparative statement of collection made in respect of timber being brought through FATA route and the collection being made through Bin Shahi route. A perusal of this comparative statement which is also reproduced hereinabove shows that the schedule has been made for a unit of 600 cft and in the collection to be made under the FATA policy, permit fee of political agent, forest development fund by PA, forest duty by forest department, forest development fund by forest department, golden jubilee by forest department as already collected has been worked out and it has been computed at almost Rs,100 per cft. A perusal of the Ordinance shows that Permits fees and other cesses are leviable under section 57 of the Ordinance and this section is reproduced as under:-- "57. Permits fees and other cesses.---(1) In addition to the forest duty and forest development charges, Government may levy permit fees and other cesses on timber coming from Federally Administered Tribal Areas or areas outside Pakistan into the settled part of Province.
(2) The amount realized from such cesses shall be charged to the Forest Development Fund."
' A perusal of this section shows that Permits fees and other cesses leviable on timber from FATA or areas outside Pakistan into the settled part of Province cannot be equated with Forest Duty but are chargeable under another section and therefore they cannot be considered for comparison of forest duties. Since it has not been shown that any Permit fee has been levied on timber being brought through Bin Shahi route, therefore the schedule could not help the cause of the petitioners to justify their case to levy forest duty Rs,90 per cft.
17. We now come to the legal proposition as to whether a notification can take away or impair a vested right acquired by a payer. From 1970 onwards starting from the case of Collector of Central Excise and Land Customs and others v. Azizuddin Industries (PLD 1970 SC 439) this Court has been consistently holding that although the legislature can through specific words impose a tax with retrospective effect, however, the government or any other authority authorized to issue notification cannot issue notification giving it retrospective effect so as to impair or take away a vested right. In this connection we would just like to refer first the judgment in' the case of Messrs Army Welfare Sugar Mills (supra) wherein this Court has held as under:-
15. "21. It seems to be well-settled proposition of law that a notification which purports to impair an existing or vested right or imposes a new liability or obligation, cannot operate retrospectively in the absence of legal sanction, but the converse i,e, a notification which confers benefit cannot operate retrospectively, does not seem to be correct proposition of law. It may be observed that para. 2 of the above SRO.814(1)/85 was a beneficial provision and, therefore, in the absence of any prohibition in the Act or any other law, it was valid. It is also significant to note that the above SRO.814(1)185 was issued by the Federal Government in exercise of power conferred on it under section 12-A of the Act, whereas, the above impugned notices dated 18-4-1989 have been issued by the Collector. It is not understandable as to how the Collector, Central Excise and Land Customs, could have declared the above SRO as void ab initio in presence of sections 38 and 41 of the Act. The former section provides that 'all rules made and notifications issued under this Act shall be made and issued by publication in the official Gazette. All such rules and notifications shall thereupon
16. ' have effect as if enacted in this Act', whereas, the latter section lays down that 'all officers and persons employed in the execution of this Act and the rules made thereunder shall observe and follow the orders, directions and instructions of the Central Board of Revenue'."
17. The second judgment is a recent judgment of this Court authored by his lordship Hon'ble Mr. Justice Iftikhar Muhammad Chaudhry, the present Chief Justice of this Court, in which this Court has held as under.--
18. "8. A perusal of impugned judgment indicates that the amending Notifications i,e, SRO.584(1)/95 dated 1st July, 1995, has been declared discriminatory qua the Companies, who have opened letters of credits or submitted bills of entry before the date of issuance of notification, thus holding that it will have no effect retrospectively but prospectively. The conclusion so drawn by learned High Court if entirely in consonance with the law laid down by this Court from time to time that a notification cannot operate retrospectively and benefits and advantages if already accrued in favour of a party during subsistence of the notification shall be available to it until the notification is amended or rescinded as held in Messrs Army Welfare Sugar Mills Limited and others v. Federation of Pakistan 1992 SCMR 1652; Taj Mahal Hotel Limited v.
Karachi Water and Sewerage Board 1997 SCMR 503; Hashwani Hotels limited v. Federation of Pakistan and others PLD 1997 SC 315; Messrs Elahi Cotton Mills Limited and others v. Federation of Pakistan through Secretary, Ministry of Finance, Islamabad and 6 others PLD 1997 SC 582; Federation of Pakistan v. Shaukat Ali Mian and others PLD 1999 SC 1026. At this juncture another important aspect of the retrospectively of notification may also be noted that if the notification has been used for the benefit of the subject then it can be made operative retrospectively but if its operation is to the disadvantage of a party who is the subject of the notification then it would operate prospectively. This point has been elaborately discussed by this Court in the judgment pronounced in the case of Messrs Army Welfare Sugar Mills Limited and others 1992 SCMR 1652."
19. It is, therefore, clear that the impugned notification which was issued on 16-2-2005 cannot be given effect from 1-4-2004 but has to H come into effect on the date of its publication i,e, 5-5-2005 as held by this Court in the case of Tehsil Municipal Administration, Faisalabad v. Secretary, Local Government, Government of the Punjab, Lahore etc. (PLJ 2006 SC 783).
20. We have, therefore, no hesitation in holding that the impugned notification will come into effect prospectively from 5-5-2005 and will not be applicable to the timber imported/brought in the province through Bin Shahi route by the present respondent prior to that date.
21. Now we come to the last contention of the learned AAG, whereby he argued that since the respondent had furnished an undertaking on 26-4-2004 that he will pay the duty in accordance with policy dated 16-10-2003 @ Rs,90 per cut, therefore, he is estopped from challenging the same.
We have already held that forest duty cannot be enhanced through a policy but only through a notification issued by the government in accordance with provisions of section 56 of the Ordinance J and therefore the enhancement of duty through a policy is not in accordance with law and is illegal and of not legal effect. It is trite law that consent or undertaking given in connection to policy which is not in accordance with law is not binding upon the person giving such an K undertaking/consent. We therefore hold that the respondent was not estopped from seeking legal remedy against levying illegal forest duty upon him and thus the forest duty can be refunded to him in accordance with judgment of this Court in case of Messrs.' Pfizer Laboratories Ltd. (supra) where this Court has laid down the following principles.
"Following are the principles on the point in issue:--
(i) If one party under a mistake, whether of fact or law, paid some money to another party (which includes a Government department), which was not due by law or contract or otherwise, that must be repaid in view of section 72 of the Contract Act, 1872.
(ii) The customs duties and charges referred to in section 33 of the Customs Act should be chargeable and payable by an importer or exporter and that due to inadvertence, error or misconstruction, more amount was paid or recovered than what was due and payable, the claim for the refund of such an excess amount should be made within six months as envisaged in section 33, Customs Act, 1969, but where the duty or tax charged and recovered was not payable at all, section 33 had no application.
(iii) If the customs duty or any other levy was realized and its realization was outside the Statutory Authority, the provision providing limitation of six months was not attracted.
(iv) When any excise duty was recovered which was not loveable, limitation of one year provided in Rule 11 of the Central Excises and Salt Rules, 1944 was not applicable nor an alternate remedy by way of a suit will be a bar to a Constitutional petition under Article 199 of the Constitution of Pakistan.
(v) Payment of excise duty or any other tax without knowledge that the same was exempted under a notification was refundable on the same footing as if there was no lawful imposition.
(vi) To return what has been taken wrongly is as much a duty and grace of Government as to levy relentlessly and fully what is due.
(vii)Where some money is-received by the Government not lawfully due, the plea of limitation by its departments was violative of the principles of morality and justice.
(viii) When moneys are paid to the State which the State had no legal right to receive, it was ordinarily the duty of the State, subject to special provisions of any particular statute or special facts and circumstances of the case, to refund the amount so received and in case of failure, a superior Court in exercise of its Constitutional jurisdiction could direct the refund of the same if no disputed questions of facts were involved.
(ix) There may not be legal liability on the part of a Government functionary to refund any amount received by its 'as a. Tax or other levy by virtue of certain special provisions under the special law but keeping in view democratic. Society governed by the rule of law and every Government, which claims to have ethical and moral values, must do what is fair and just to the citizens regardless of legal technicalities.
(x) The fact that the amount of tax of which refund was claimed was voluntarily paid, did not preclude the right to claim refund, if it was not lawfully payable.
(xi) The money paid by a citizen to a public authority in the form of taxies or other levies paid pursuant to an ultra vires demand by the authority was prima facie recoverable by a citizen as of right. The retention of moneys known to have been paid under a mistake at law, although it was a course permitted to. An ordinary litigant was not regarded as a 'high-minded thing' to do, but rather as a 'shabby thing' or a 'dirty trick'."
22. From what has been discussed above, we are of considered opinion that this petition does not merit consideration and therefore dismiss the same and uphold the impugned judgment of the learned Peshawar High Court.