' SHAHID ANWAR BAJWA, J.--- With the consent of learned counsel this constitutional petition was finally heard at Katcha Pethi stage and is being decided accordingly.
2. Section 47 of the Employees Old-Age Benefits Act, 1976 provides as under:-- "47. Act not to apply certain persons.--- Nothing in this Act shall apply to--
(a) persons in the service of the State, including members of the armed forces, police force and railway servants;
(b) persons in the service of a local council, a municipal committee, a Cantonment Board or any other local authority;
(c) persons who are employed in services or installations connected with or incidental to the Armed Forces of Pakistan including an Ordnance Factor maintained by the Federal Government or Railway Administration;
(d) persons in the service of Water and Power Development Authority;
(e) persons in the service of a bank or a banking company;
(f) persons in the service of statutory bodies other than those employed in or in connection with the affairs of as denied in section 2(j) of the Factories Act, 1934 (XXV of 1934), or a mine as defined in the Mines Act, 1923 (VI of 1923):
(g) Provided that workshops maintained exclusively for the purposes of repair or maintenance of equipment or vehicles used in such statutory bodies shall not be treated as factories for the purposes of this clause;
(h) (g) members of the employer's family that is to say, the husband or wife and dependent children of the employer living in his house in respect of their work for him; and
(i) (h) Omitted by the Finance Act, I of 1986, 5.11.
(j)
3. Through Finance Act, 2008 the following amendments were made in the Act of 1976:---
(k) "9. Amendments of Act XIV of 1976.--- In the Employees' Old-Age Benefits Act, 1976 (XIV of 1976), the following further amendments shall be made, namely:---
(1) In Section 1, in subsection (4),---
(a) in clause (I),---
(i) for the word "ten", occurring twice, the word "five" shall be substituted; and
(ii) for the colon at the end, a full stop shall be substituted and thereafter the proviso shall be omitted; and
(b) in clause (ia) for the word "twenty", the, word "five" shall be substituted;
(2) in section 9, in subsection (1), for the word "six" the word "five" shall be substituted;
(3) in Section 22, in subsection (2), in clause (ii) for the full stop at the end, a colon shall be substituted and thereafter the following proviso shall be added, namely: Provided that nothing in this section shall apply to an employee insured under, this Act on or after 1st day of July, 2008.
(4) in section 47, clause (e) shall be omitted; and
(5) In the Schedule-
(a) for paragraph (2), the following shall be substituted, namely:-- "(2)The monthly wages of an insured person, referred to in paragraph (1), shall be calculated on the basis of wages on which contributions were paid in respect of the twelve calendar months immediately preceding the date on which insured person fulfils the conditions for entitlement to any benefits under this Act: ' Provided that the old-age pension or invalidity pension payable to an insured person and survivor's pension payable to the survivors of the deceased insured person shall not be less than two thousand rupees per month for pension commencing on or after 1st day of July 2008"; and
(b) in paragraph (3) for the figure "2007" the figure "2008".shall be substituted."
4. Learned counsel for the petitioners submitted that the Act of 1976 is not an Act which can be called a money-bill and therefore it could not be amended through a Finance Act, which can be passed only by the National Assembly and not by the Senate.
5. Learned counsel for the petitioner relied judgment of this Court in the case of Employer's Federation of Pakistan v. Federation of Pakistan, C.P. No,D-260 of 2008, decided on 26-2-2011.
Learned counsel also relied upon judgment of the Supreme Court reported as Sindh High Court Bar Association through its Secretary and another v. Federation of Pakistan through Secretary, Ministry of Law and Justice, Islamabad and others PLD 2009 SC 879 and Mir Muhammad Idris and others v.
Federation of Pakistan through Secretary Ministry of Finance and others, PLD 2011 SC 213. Learned counsel also relied upon Messrs Saif Textile Mills Limited v. Pakistan through Secretary, Finance (Finance Division), Islamabad and 3 others, PLD 1998 Peshawar 15. Learned counsel also placed on record a copy of the letter written by the Director, Workers' Welfare Fund and contended that the Workers Welfare Fund, an arm of the Federal Government is asking industry to comply the judgment of this Court in Employer's Federation of Pakistan's case (Supra).
6. Learned counsel for Employees Old-Age Benefit Institution submitted that the contribution to be made under the Act of 1976 is a tax and therefore it has been validly amended through the Finance Act. Learned counsel referred to Corpus Juris Secundum Vol. 84 and to it following part:--- "Essentials of tax. As indicated in its definitions, the essential characteristics of a tax are that it is not a voluntary payment or donation, but an enforced contribution, exacted pursuant to legislative authority, in the exercise of the taxing power, the contribution being of a proportionate character, payable in money, and imposed, levied, and Collected for the purpose of raising revenue, to be used for public or governmental purposes, and not as payment for some special privilege granted or service rendered."
7. Learned counsel further submitted that employees Old-Age Institution pays unemployment compensation and by referring to Words and Phrases, Permanent Edition Vol. 41 page 270, submitted that contribution made in respect of unemployment is a tax. Said observations are as under:-- "Contributions under the unemployment compensation law; by whatever name designated, constitute a "tax". Prudential Ins. Co. of America v. Powell, S. S E 2d 619, 621 217 N.C.
495.
' The compulsory contribution which an employer is required to make to unemployment compensation fund is a "tax".
' Contributions to state unemployment insurance fund are "taxes" imposed on employers and the amounts thereof are governed by employer's payroll. In re McClatchey's Estate, 11, N.Y. S.2d 266, 272 Misc.
696.
' The "contribution" imposed by the unemployment compensation act is a "tax". Unemployment Compensation Commission v. L.Harvey & Son Co., 42 S.E.2d 86,91, 227 N.C.291."
9. Regarding fee learned counsel referred to Corpus Juris Secundum and to the following observations:--- "Fee" means the payment for services done, or to be done; and it may be for acts or services done or performed, partially done or rendered, or to be done or rendered, or for services rendered at regular periods, especially for personal, profession, or special services; and usually the particular acts or services should be done or rendered in the line of some duty; at though in a particular connection the term has been held broad enough to include ex officio compensation without specific regard to the performance of any particular service; and, as used in some statutes, the word "fees" is not restricted to charges which may be collected by a public official for services rendered by him to the public, while under other statutes it has been held to be so limited.
' The general rule is that fees should be paid by the persons obtaining the benefit of the acts, or receiving the services, or at whose instance they were done or performed."
8. Learned counsel relied upon Muhammad Ismail & Co., Ltd., v. Chief Cotton Inspector PLD 1966 SC 388 and Messrs Fatima Enterprises v. Federation of Pakistan through Secretary, Education Ministry of Education, Islamabad and others, 1999 M LD 2889. Learned counsel also referred to Article 38 of the Constitution of Islamic Republic of Pakistan and submitted that the Act of i976 is a step in that direction. Learned counsel lastly submitted that petitioner in C.P. No,D-1558 of 2012 himself applied to the Institution after amendment was brought about and therefore stop by his conduct.
9. Learned Standing Counsel submitted that the petitions may be decided in accordance with the law.
10. We have considered the submissions made by the learned counsel and have also gone through the record.
11. In Employer's Federation's case (Supra) in which case amendments in certain Labour laws including Employees Old-Age Benefits Act, 1976 by the Finance Act, 2007 were challenged. The Division Bench relied upon judgment of the Supreme Court in the case of Sindh High Court Bar Association's case (Supra) and observed as under:--- "7. A perusal of the above para indicates that any amendment made through a money bill in any substantive law dealing with the subject other than what is defined as money bill in Article 73(2) of the Constitution would be valid and effective only for the purposes of making financial provisions but would not have the effect of changing piece of legislation which does not squarely fall within the ambit of scope of money bill as given under Article 73(2) of the Constitution."
' Thereafter it was observed as under:-- "Through section 12 amendment has been made in the Employees Old-Age Benefits Act, 1976. None of these has any connection or link with any of the items specified in Article 73(2) of the.
Constitution. None of these amendments relate to imposition, abolition, remission or regulation of any tax. They do not concern with barrowing of money or giving of any grant by Federal Government or any law relating to the financial obligation to the Federal Government They have no link whatsoever with the custody of Federal Consolidated Fund and payments of money into or issue of money from it. They do not deal with imposition of any charge upon the Federal Consolidated Fund or the abolition, alteration of any such charge. They do not impact upon receipts of moneys on account of Public Account of the Federation or to the audit of accounts of the Federal Government. None of them by any stretch of logic therefore can be treated as money bill.
15. Constitution of a country, is the fundamental document laying down, among others, structures of the State and powers and functions of various organs of the State. All such organs are creations of the Constitution and derive their powers from the Constitution and subject to the Constitution from laws enacted in accordance with the dictates of the Constitution. Power to enact laws is one of the most essential powers in existence of any State. Our Constitution has conferred all necessary powers in this regard on the Parliament and the Provincial Assemblies and powers of issuing Ordinances though valid for defined periods upon the President or, as the case may be, a Governor of a Province. Where it deals with power of the Parliament to legislate it clearly created a dichotomy between money bills and other legislation. Money bill can originate only in the National Assembly and after having been passed by the National Assembly are to be transmitted to the President for his assent and are not required to be passed by the Senate: Scope of money bills has been defined under Article 73(2) of the Constitution. If a bill which does not fall within the scope of money bill defined is passed as money bill it amounts to depriving Senate of Pakistan of the powers conferred upon it by the Constitution. Mandate of the Constitution must be respected and should not be sacrificed at the alter of political expediency.
16. As far as contention that certificate issued by the Speaker of National Assembly cannot be challenged is concerned, suffice it to say that we have followed judgment of the Supreme Court in Sindh High Court Bar Association's case (Supra).
17. We are fully cognizant of the fact that all Labour legislation is primarily designed to be beneficial in nature and it aims at protecting a weaker segment of the society and at reducing rigors of their lives. The noble sentiments behind changes in the Labour Laws cannot have the effect of conferring legitimacy on a piece of legislation which otherwise has not been validly enacted. In Sindh High Court Bar Association's case (Supra) since Islamabad High Court as created in 2007 was found to have been created in exercise of powers which were not available with the then President/Chief of Army Staff, the Supreme Court held that Chief Justice and Judges of the Islamabad High Court shall cease to hold office. Thereafter in Para 183 of the judgment the Supreme Court noted that under Article 37 of the Constitution, the State is obliged, inter alia, to ensure inexpensive and expeditious justice. Thereafter the Supreme Court observed as under:--- "The establishment of the Islamabad High Court was commendable step in aid of the right of access to justice in line with the above constitutional mandate and the law laid down in the aforesaid cases. However, it ... unfortunate that the said Court was not established in accordance with the provisions of the Constitution, rather it was so done by a person not empowered under the Constitution to do so, with ulterior motive. General Pervez Musharraf, as held in the preceding paragraphs, mixed up his mala fide acts of removal of Judges of the superior Court in violation of the Constitution and his own purported validation of all such unconstitutional and illegal acts by means of Article 270AAA, with the act of establishing a High Court for the Islamabad Capital Territory, otherwise an act, which would tend to advance or promote the good of the people, so that he was able to get validation and affirmation from the Parliament, as had happened in the cases of Begum Nusrat Bhutto and Zafar Ali Shah. Thus, having been so unconstitutionally established in a highly objectionable manner, it was not possible to project it. It is, therefore, added that notwithstanding what has been declared and ordered above, the relevant and competent authorities may take steps to establish such a court in accordance with the Constitution and law."
18. We can only observe that it is within competence of both the Legislature to legislation for providing similar, better or different provisions and benefit but that can only be done in accordance with the procedure prescribed under the Constitution."
12. After Sindh 'High Court Bar Association's case the Supreme Court had occasion to visit the same question in Mir Muhammad Idris's case (Supra) and in respect of certain amendments in the Banks (Nationalization) Act, 1974 and declared those amendments as not valid on the same ground . Mr. Mehmood Abdul Ghani pointed out that a number of applications under section 12(2), C.P.C. were filed for recalling judgment of this Court in Employer's Federation's case which were dismissed vide order dated 10-4-2012. Mr. Mehmood Abdul Ghani also pointed out that Workers Welfare Fund which admittedly is one of the arms of the Federal Government has written letters to employers calling upon them to comply with judgment of this Court in Employer's Federation's case.
13. Thrust of arguments of learned counsel for respondent No,2 was that what is collected by respondent No,2 is a tax because according to him it is collected for the purpose of providing unemployment compensation. Contention is clearly misconceived. Under section 4 of the Act of 1976 the Employees Old-Age Benefits Institution is a body corporate. It has separate accounts and the contribution made by employer or by the employees is paid to the institution and is not paid to the government. Contribution is paid in respect of each employee and institution is then liable to provide benefits under the Act to such employees. It is therefore contribution for a service to be rendered by the institution in future and each penny of the institution has nexus with a particular employee employed by the employers. It therefore, cannot be by any stretch of imagination called the tax. Question in Muhammad Ismail & Co.'s case (supra) was regarding, validity of a fee imposed by the Provincial Government under the provisions of the West Pakistan Cotton Control Act, 1949. Section 26 of that Act provided requisite powers for the Provincial Government to impose fee on occupiers of factories, managers of companies and cotton dealers to cover cost of staff appointed under the Act or for improvement of agriculture relating to the cotton crop grown in Punjab. The Supreme 'Court observed as under:-- "The matter was examined in the light of the provisions of the Indian Constitution and the general connotation of the terms "tax" and "fee". The learned Judges adopted the definition of "tax" given by Latham, C.J. of the High Court of Australia in Mathews v. Chicory Marketing Board (5). A tax", said the learned Chief Justice, "is a compulsory exaction of money by public authority for public purposes enforceable by law and is not payment for services rendered". A fee, according to learned Judges, may be generally defined to be "a charge for a special service rendered to individuals by some governmental agency". It was added that the amount of fee levied is supposed to be based on the expenses incurred by the Government in rendering the service, though in many cases the costs are arbitrarily assessed. The learned Judges were, however, conscious of the fact that there may be various kinds of fee and that it was not possible to formulate a definition that may be applicable to all cases."
14. Learned counsel relied upon Fatima Enterprises' case (Supra) which was regarding federal education fee. It was observed by a learned Single Judge of Lahore High Court as under:
15. "(14) This article provides that no tax can be levied for the purposes of the Federation except by or under the authority of an Act of Parliament. There is no cavil that the prohibition under Article 77 is in respect of taxes and not fees and there is a clear distinction between a tax and a fee and Constitution recognizes this distinction. The main distinction between a tax and a fee is that a tax is levied as part of a common burden, while a fee is a payment for special benefit, privilege or services. In regard to fees there must be co-relation between the fee collected and the service intended to be rendered. In the case of a fee, it is the special benefit or privilege according to an individual which is the reason for its payment, whereas in the case of a tax the particular advantage, if it exists at all, is an incidental result of a State action. There is also no cavil in the prohibition levied by a statute amounts to a fee or tax will always be a question of fact to be determined in the circumstances of each case."
15. The two cases are clearly distinguishable. It may be noticed that when Employees Old-Age Benefits Act, 1976 was promulgated it was promulgated after it having been passed by both houses of the Parliament. In any case, since we have reached the conclusion that the contribution, made to the Employees Old-Age Benefit Institution is made in respect of a specific designated employee for services to be rendered by the institution to that particular employee and other employees in accordance with the provisions of the Act, the contribution is in the nature of fee and not a tax. We consequently hold that amendments brought in the Act of 1976 by the Finance Act, 2008 are without lawful authority and of no legal effect.
16. Needless to observe that it is always available to the Federal Government to initiate/promulgate legislations in accordance with the provisions of the Constitution.