TARIQ SALEEM SHEIKH, J. The Petitioner is carrying on business under the name and style of Hafiz Oil-Traders at Badami Bagh; Lahore, and essentially deals in Tube oil -- commonly known as mobil oil. His grievance is that the officers of Police Station Lorry Adda, Lahore (Respondents Nos.4 to 6), interfere, in his lawful business and harass him. He moved an application under section 22-A, Cr.P.C. before the Ex-officio Justice of Peace, seeking protection against their alleged excesses which he dismissed vide Order dated 11.11.2021 (the "Impugned Order") holding that it was mala fide.
The Ex-officio Justice of Peace, however, observed that he could file a private complaint if he had a genuine issue. Through this petition under Article 199 of the Constitution of Pakistan, 1973, the Petitioner has assailed that order before this Court.
The submissions
2. The counsel for the Petitioner, Mr. Sheraz Zaka, Advocate, contends that Article 18 of the Constitution grants the Petitioner fundamental right to enter upon any lawful trade or business so he set up a shop at Badami Bagh, Lahore. It was all smooth until recently when Respondents Nos.4 to 6 started meddling in his affairs due to ulterior motives. He contends that he is not engaged in the sale of any fake, adulterated or substandard products and if there is a complaint only the authorities designated under the Pakistan Petroleum (Refining, Blending and Marketing Rules), 1971 (the "1971 Rules"), can take action against him. Respondents Nos. 4 to 6 have no jurisdiction to raid at his premises, register FIR and arrest him. In support of his contentions he has relied upon Naeem Akhtar and 2 others v. The State (1993 MLD 577); Liaquat Ali v. The State (1993 MLD 2279); Sh.
Mahboob Ahmad v. SHO Police Station Rail Bazar, Faisalabad and others (PLD 1999 Lahore 390); Tariq Mahmood v. Muhammad Jehangir Gorayia and 2 others (2003 YLR 239); Muhammad Sadiq v. Regional Police Officer, Muzaffargarh and 3 others (PLD 2008 Lahore 335); Cool Industries (Pvt.) Ltd. v. Shafique Ahmed and 4 others (2010 MLD 435); Raja Ansar Nadeem Ahmad v. The State and others (2012 YLR 2855) and Imam Ahsan v. Station House Officer and another (2014 PCr.LJ 838).
3. The Deputy Attorney General, Mr. Asad Ali Bajwa, contends that the Petitioner requires a licence under the Pakistan Oil (Refining, Blending, Transportation, Storage and Marketing) Rules, 2016 (the "2016 Rules"), for his business but he is operating without it so it is illegal. He further contends that the Petitioner is a security hazard as he works without the safety measures necessary for undertaking such business. Hence, the police have an obligation.
4. The Assistant Advocate General, Mr. Mukhtar Ahmad Ranjha, contends that the present petition is mala fide. According to him, the Petitioner wants to use it as a tool to pressurize the police and stop them from performing their functions. He argues that the Impugned Order is well reasoned and does not call for interference by this Court. Adds that the police have not transgressed their authority.
5. This Court impleaded the Oil and Gas Development Authority (OGRA) as Respondent No.11 in this case vide Order dated 01.02.2022. OGRA has submitted its report/comments stating that it has exclusive authority to grant licence to the lubricant marketing companies under Rule 45 of the 2016 Rules. These companies may not only import but also purchase lube oil products mom the local blending plants and then sell/market them through their retail distribution outlets. In addition thereto, OGRA also grants licence for operation of lube oil blending plant, reclamation plant and grease plant but the licensee cannot sell refined lubricants to any person other than his authorized dealer, agent or consumer as per Rule 18. The report further says that the Ministry of Energy (Petroleum Division) notifies the specification of refined oil products under Rules 11 and 11A of the 1971 Rules. Inasmuch as the lubricants have flash, point over 200 F, they are categorized as non- dangerous petroleum products and a licence is not required for their sale as- such. As regards the Petitioner, it is contended, he is subject to regulation under Rules 12, 13, 60, 62 and 63 of the 2016 Rules.
Opinion
6. Article 18 of the Constitution declares that every citizen shall have the fundamental right to enter upon any lawful trade or profession subject to such qualifications or conditions as may be prescribed by law. It reads:
18. Freedom of trade, business or profession. ---Subject to such qualifications, if any, as may be prescribed by law, every citizen shall have the right to enter upon any lawful profession or occupation, and to conduct any lawful trade or business: Provided that nothing in this Article shall prevent- -
(a) the regulation of any trade or profession by a licensing system; or
(b) the regulation of trade, commerce or industry in the interest of free competition therein; or
(c) the carrying on, by the Federal Government or a Provincial Government, or by a corporation controlled by any such Government, of any trade, business, industry or service, to the exclusion, complete or partial, of other persons.
7. In Messrs East and West Steamship Company v. Pakistan through-the Secretary Government of Pakistan and 2 others [PLD 1958 SC (Pak) 41], while considering Article 12 of the Constitution of 1956 which was pari materia with the present Article 18 reproduced above, Cornelius J. said: "[Article 12] declares in unequivocal terms that every citizen shall have the right to conduct any lawful trade or business. In so doing, the Article merely furnishes a fresh and authoritative declaration of a pre-existing right under the common law ... [A]mong the considerations which guided the Constitution makers in the drafting of Article 12, so as to secure freedom to the citizens of Pakistan to conduct any lawful trade, the place of greatest importance must be given, firstly, to the necessity of ensuring to every individual member of the community, a right to engage in lawful trade according to his choice and to exercise that trade in a mode settled by him at his own discretion and choice, within the legal requirements, and secondly that the interests of the community should be advanced, by the grant of such liberty to individual citizens, and that every action which tends to interfere with that liberty should be repressed, since it would be injurious to the interests of the State."
8. The right conferred by Article 18 is not absolute and it can be regulated by law. Proviso (a) expressly permits regulation of a trade or profession by licensing system. The American Jurisprudence, Vol. 33, p. 32, elucidates the definition and general nature of a licence as follows: "In its specific sense, to license means to confer on a person the right to do something which otherwise he would not have the right to do. A license is in the nature of a special privilege rather than a right common to all, and is often required as a condition precedent to the right to carry on business or to hold certain classes of property within the jurisdiction."[1]
9. After the Independence the Regulation of Mines and Oil-fields and Mineral Development (Government Control) Act, 1948, was enacted to regulate, as its title suggests, mines, oil fields and mineral development. The Federal Government framed the 1971 Rules[2] under that Act. About three decades later the Oil and Gas Regulatory Authority Ordinance, 2002 (the "Ordinance"), was promulgated to "foster competition, increase private investment and ownership in the midstream and downstream petroleum industry, protect the public interest while respecting individual rights, and provide efficient regulation"[3] of the industry and to this end established the OGRA. Then, in exercise of the powers conferred on it under section 41 of the Ordinance, OGRA framed the 2016 Rules.[4]
10. The Federal Government, vide SRO No. 236(1)/2006 dated 13-03-2006, transferred a number of powers exercised by the DG Oil to OGRA. Now that the 2016 Rules have been framed, they override the 1971 Rules to the extent of inconsistency under the doctrine of implied repeal.
11. Section 21 of the Ordinance empowers the Federal Government to issue policy guidelines to OGRA which it must follow while discharging its functions. Section 22 provides that OGRA shall have the exclusive power, subject to the rules framed under section 41, to grant a licence in respect of any regulated activity. According to the 2016 Rules, licence is mandatory for the following purposes:
(a) refining (Part-II); (b) blending (Part-III); (c) transportation of oil through pipelines and associated facilities (Part-IV); (d) storage (Part-V); (e) marketing of petroleum products (Part-VI);
(f) marketing of lubricants (Part-VII); and (g) oil testing facility (Part-VIII).
12. Part-X of the 2016 Rules makes provision for inspection, sampling and quality control. Rule 54 stipulates that the Inspection Officers (which includes the members of OGRA and any person including the District Coordination Officer authorized by it in writing) may at any reasonable time enter and inspect any premises or facility owned or operated by an oil marketing company, refinery, blending plant, reclamation plant or grease plant. They may also take samples and make inquiries to ascertain whether the 2016 Rules are being complied with. Rule 55 confers 'additional powers on the Inspection Courts and provides that they may further check and satisfy themselves that the provisions of the Ordinance and the 2016 Rules and the orders of OGRA are followed by all the concerned. Rules 57 to 60 deal with sampling and spot testing. Rules 61 to 63 prohibit adulteration of petroleum products and their possession and sale. The offences under the Ordinance are punishable with sentence of imprisonment and fine.
13. It is not clear from the available record as to whether the Petitioner is running any blending, reclamation or grease plant or produces or packs refined lubricating oils or greases for sale. Even during the hearing of this case his counsel, Mr. Zaka, was evasive. These are regulated activities and if he is engaged in any of them, he requires a licence in terms of Rules 10 and/or 43 of the 2016 Rules. Anyway, paragraph-4 of the petition suggests that the Petitioner has set up an oil depot.
Licence is mandatory for that business activity under Rule 28 but he has not presented it to this Court. Indeed, he is liable to be prosecuted if he is engaged in any regulated activity without a licence. It must, however, be pointed out that this matter falls within the purview of the Inspection Officers - and OGRA - because Rule 55 ordains that they would ensure compliance of the Ordinance and the 2016 Rules in letter and spirit by all and sundry.
14. Respondents Nos.4 to 6, however, have a different case here. They allege that the Petitioner sells substandard/ unbranded Tube oil which constitutes a cognizable offence under section 285 of the Pakistan Penal Code, 1860. The Petitioner denies the allegation and contends that even if it is true the question as to whether any petroleum product is substandard cannot be determined without proper sampling by the Inspection Officer (or other authorized officer) and laboratory analysis in terms of Part-X of the 2016 Rules. Thus, according to him, this matter also falls within the domain of OGRA and the local police have no jurisdiction.
15. As adumbrated, Rules 61 to 63 of the 2016 Rules prohibit adulteration of petroleum products and their possession and sale. Clause (i) of Rule 2(1) states that "'adulterate' means to produce, prepare, mix or blend any petroleum product with any other substance which reduces its quality below the required specifications and the terms 'adulteration' and 'adulterated' shall be construed accordingly." As per clause (xix) of Rule 2(1), "'petroleum products' include refined oil products, lubricating oils and greases excluding LPG under Schedule-III." Substandard lube oil falls within the definition of adulteration. Therefore, it has to be dealt with under Part-X of the 2016 Rules and action by other agencies, including the police, is barred. The authorities relied upon by Mr. Zaka lay down the same principles.[5]
16. The counsel for OGRA, Barrister Haroon Dugal, has apprised this Court that OGRA conducts quality inspection of lube oil products of licenced companies at the time of import and that of the blending pants on quarterly basis through its approved laboratory, i.e. Hydrocarbon Development Institute of Pakistan. Besides, it conducts random inspections under Rule 54 of the 2016 Rules through any person, including the District Coordination Officer, authorized in writing. Therefore, it is clarified that Respondents Nos.4 to 6 may also inspect the Petitioner's premises if they are authorized by OGRA.
17. It needs to be noted that section 285, P.P.C. is not attracted to the sale of adulterated petroleum products. True, it is a cognizable offence but it empowers the police to proceed in the following two situations: (i) where a person does any rash or negligent act with regard to any combustible matter which endangers human life or is likely to cause hurt or injury to any other, or (ii) where a person knowingly or negligently omits to take appropriate steps to ensure that the combustible matter in his possession does not become threat to human life. I do not have any facts before me from which I may determine whether the Petitioner has committed the illicit act. Therefore, I refrain from making any observation in that respect and direct Respondents Nos.4 to 6 to act strictly in accordance with the dictates of this provision.
18. The Petitioner has a right to be treated in accordance with law under Article 4 of the Constitution. He is at liberty to undertake legal proceedings where that right is denied to him. This petition is disposed of accordingly.
1. Approvingly cited by Muhammad Munir CJ in Messrs East and West Steamship Company v.
Pakistan through the Secretary Government of Pakistan and 2 others [PLD 1958 SC (Pak) 41]
2. Pakistan Petroleum (Refining, Blending and Marketing) Rules, 1971.
3. Preamble of the Oil and Gas Regulatory Authority Ordinance, 2002.
4. Pakistan Oil (Refining, Blending, Transportation, Storage and Marketing) Rules, 2016.
[5]Pakistan Oil (Refining Blending, Transportation, Storage and Marketing) Rules, 2016.