SHAMS MEHMOOD MIRZA, J.---- This writ petition calls into question notices dated 19.02.2016 and 25.02.201 issued by respondent No.3 requiring the petitioner to make payment of the NHA tax for installation of unauthorized advertisement board.
2. The facts of the case in brief are that the petitioner operates McDonald's restau rant located near Jhelum River toll plaza. The petitioner has installed an advertisement board/pylon on the premises for identification of the restaurant. Through the impugned notices the petitioner was directed to make payment of Rs.75,000/- per month as advertisement tax for installation of the pylon. It is stated that the petitioner informed respondent No.1 that it was not liable to pay the tax but to no avail.
3. Learned counsel submits that respondent No.1 has no authority under the National Highway Authority Act, 1991 (the Act) and the rules framed thereunder to charge such a fee from the petitioner as the restaurant is operated from a private property which does not fall in the jurisdiction of National Highway Authority (the Authority). It is furthermore submitted that respondent No.2 being a private contractor has no authority to issue notices to the petitioner for payment of the tax in ques tion. The petitioner places reliance on the judgment reported as Shell Pakistan Limited v. Capital Development Authority PLD 2015 Islamabad 36. The petitioner also pleads that certain amounts under protest were paid to the Authority which are liable to be returned to it.
4. Learned counsel for the Authority submits that by virtue of section 10(2)(vi) and (viii) of the Act read with Rule 12 of the National Highways and Strategic Roads Control Rules, 1998 (the Rules) the petitioner is liable to pay the tax.
Learned counsel for respondent No.2 adopted the arguments of learned counsel for respondent No. 1 .
5. Arguments heard, record perused.
6. It is settled law that rules and regulations being subordinate legislation cannot go outside the ambit and scope of the parent statute. The mere fact that power has been conferred on the Authority to make rules and regulations does not authorize framing of delegated legislation that is inconsistent or repug nant to the parent Act. In the present case, the rule making power is couched in general language permitting the Federal Government to frame rules for carrying out the purposes of the Act without laying down any guidelines for the exercise of such power . In such a case, it is the duty of the Court to find out the object and purpose of the Act to satisfy itself that the Rules framed do not create any substantive rights and obligations or disabilities not envisaged by the Act.
7. The learned counsel for the Authority placed reliance on section 10(2)(vi) and (viii) of the Act to justify the Rules and by extension the levy of advertisement fee on the petitioner through a private contractor . Section 10 authorizes the Authority to take such measures and exercise such powers as it considers necessary or expedient for carrying out the purposes of the Act. Clauses (vi) and (viii), of subsection (2) read as under:
(vi) enter into and perform all such contracts as it may consider necessary;
(viii) license facilities on roads under its control on such terms as it deems fit;
8. Rule 12 (1) insofar as it is relevant reads as under:
(1) The Authority may, at its discretion, with due regard to the safety and convenience of the road user and subject to such conditions as it may impose and on payment of such fees and rental charges/lease charges as it may fix, permit any person or agency to; (a) setup filling/CNG stations; hotel/motel, restaurants sign boards , nurseries, shops, khokhas, hoardings, banners for a specific period;
9. Without entering into the question of the validity of Rule 12, the power to charg e fee/rent from the utilities and signboards under this Rule is predicated on the safety and convenience of the road user. Read with section 10(2)
(viii), it becomes evident that the signboard must be on the road controlled by the Authority for it to charge fee from the person who installed it. Section 10(2)(viii), however , only authorizes the Authority to license facilities which would include the Petrol/CNG stations, restaurants/hotels, shops/khokhas etc. The Act by the terms of section 10 did not authorize the Authority to levy and charge fee on the advertisement and signboards.
10. It has not been denied by the respondents that the restaurant is being operated on a property which is privately owned and does not fall within the jurisdiction of the Authority . The conditions stipulated in Rule 12 read with section 10(2)(xiii) are thus not met with notwithstanding the fact that the charging of fee on advertisement/signboards under Rule 12 prima facie is not in conformity with section 10 of the Act. This question does not require any finding by this Court as the petitioner has not challenged the validity of Rule 12.
11. A similar issue was agitated in the case relied upon by the petitioner . The learned Islamabad High Court made the following pertinent observations:
37. The last question relates to the authority of NHA for imposing levy upon the advertisements displayed on the building line across the Highways/Motorways. The response submitted by the NHA is evasive and nothing has been brought on record whereby requirement of fee/rent or permission has been made mandatory for installing the sigh board on provide premises falling on the Building Line of the Highways and Motorways. The contention that NHA is empowered to generate income by subjecting its Right of Way to commercial way is devoid of force because Right of Way does not include building line, the term 'Right of Way' has been defined in section 2(j) of NHA Act, 1991, as follows:
(i) 'Right of Way' (ROW) means the land acquired for the purpose of construction of National Highway or any other road assigned to Authority .
Similarly , 'Right of Way' has been further explained in Rule 2(xx) of the National Highway and Strategic Roads (Control) Rules, 1998 [amended in 2002], as follows:
(xx) "Right of Way" (ROW) means the land acquired for the purpose of construction of a National Highway or any other road assigned to the Authority or taken over, ROW of the roads declared as National Highway or Strategic Road under the NHA Act and controlled by the Authority including bridges constructed and owned by the Authority ."
38. The Corridor Management under no circumstances, include levy of fee/rent for the boards displayed on private premises on the building line of the Highway. According to Rule 2(c) of NIIA Road s Maintenance Accounts Rules, 1998 the jurisdiction of NHA concerning regulation of building line is restricted to removal of encroachments, ribbon development, utilities, access or approach roads, afforestation, commercialization, roadside facilities (service and rest area; filling stations, amenities), traffic and highway safety operations (enfor cement of traffic law and rules, road side emergency telephone service, mobile vehicles repairs and rescue servic e, para medical service), weight station operations, and toll operations. The commercialization mentioned in this rule cannot be presumed to mean that NHA has authority to impose levies upon commercial activities rather the same is meant to oversee the commercialization in the back drop of road safety . Moreover , no authority can be clothed with unbridled powers to levy fees/taxes upon a class of persons which has not been specifically mentioned in statute or regulation. At this juncture it is relevant to mention that a novel stance has been taken by the authority in their written arguments whereby it is claimed that prime function of the Authority/Respondent No.3 is to generate revenue (raise funds) through commercial use. This contention is neither rationale nor legal and amounts to ruthless disregard of section 4 of National Highway Act, 1991, which enumerates following functions of Authority: "4. Purpose and functions of Authority .--- The purpose and functions of the Authority shall be to plan, promote, organize and implement programmes for constructions, development operation, repairs and maintenance of National Highways and strategic roads specially entrusted to it by the Federal Government or other authority concerned."
In this connection the demand of fee/rent for the sign board on the private premises falling on the building line of Highway is held to be illegal and ultra vires to the NHA Act, 1991 as well as the relevant rules. The NHA, however , may regulate the size and other characteristics of Sign Board in view of carriage way visual and road safety .
12. This Court is in respectful agreement with the observations made by the learn ed Islamabad High Court in the afore-mentioned passage. Rule 12 by its terms is not applicable to the facts of the present case as it does not entitle the Authority to charge rent/fee/tax on the advertisement board/pylon in the private property of the petitioner over which it has no jurisdiction. The Act and the Rules do not grant any power to the Authority to charge, levy and recover rent/fee/tax from a person in respect of any advertisement board installed in the private property . The impugned notices are accordingly liable to be set aside. Having come to this conc lusion, there is no need to dilate upon the question whether the Authority could delegate its powers to collect rent/fee/tax to a private contractor .
13. In view of the foregoing, this writ petition is allowed and the impugned notices arc declared to be without lawful authority and of no legal effect. The petitio ner may approach the Authority for refund of the amounts deposited with it for the fee under Rule 12, which refund shall be made expeditiously .