AGHA FAISAL, J.----The petitioners have assailed SRO 583(1)/2017 dated 01.07.2017 ("Impugned SRO") and seek for the instrument to be declared as ultra vires / nullity in law, upon the premise that same has been issued in violation of the Constitution, per the law illumined by the august Supreme Court in Mustafa Impex 2. The respective petitions were heard conjunctively and determined vide our common short order dated 16.04.2021, announced in Court upon conclusion of the proceedings, which read as follows: "For reasons to be recorded later on, all these petitions are allowed to the extent of SRO 583(I)/2017, dated 01.07.2017, which is hereby declared to be ultra vires, being in violation of the law declared by the Honourable Supreme Court in the case reported as PLD 2016 SC 808 (Mustafa Impex {{FOOTNOTE}} 2 Mustafa Impex v . Government of Pakistan reported as PLD 2016 Supreme Court 808 ("Mustafa Impex") {{FOOTNOTE}} and others v. The Government of Pakistan and others) The securities / sureties, furnished if any, before the Nazir of this Court stand discharged. Nazir to act accordingly ."
2. Briefly stated, the petitioners were aggrieved by certain amendments to the sales tax regime, applicable thereto, brought about vide the Impugned SRO. It was articulated that while the Constitution envisaged such variation in the incidence of taxation to be brought about by the Federal Government , however , the impugned variation was brought by the Board with the approval of the Federal Minister -in-charge . It was in this context that the Impugned SRO was contended to be devoid of Cons titutional fiat. It is considered illustrative to reproduce the preamble Of the instrument under challenge herein below: "S.R.O.583(I)/2017.- In exercise of the powers conferred by section 71 of the Sales Tax Act, 1990, read with clauses (9) and (46) of section 2, sections 3 and 4, subsection (2) of section 6, section 7A, clause (b) of subsection
(1) of section 8, subsections (2A) and (3) of section 22, sections 23 and 60 thereof, the Board with the approval of the Federal Minister-in-charge is pleased to make the following furthe r amendments in the Sales Tax Specia l Procedure Rules, 2007..."
(Underline added for emphasis.)
Respective arguments
3. The crux of the petitioners' case was that the Impugned SRO cannot survive constitutional scrutiny , when subjected to the anvil of Mustafa Impex. The learned Deputy Attorney General, and the counsel for the respondents, articulated no cavil with respect to applicable ratio of Mustafa Impex; however , supported the instrument impugned by resting their case upon the subsequent insertion of section 74A3 in the Sales Tax Act, 1990 ("Act"), being a validation clause. {{FOOTNOTE}} 74A. Validation. (1) All notifications and orders issued and notified in exercise of the powers conferred upon the Federal Government, before the commencement of Finance Act, 2018 shall be deemed to have been validly issued and notified in exercise of those powers. (2) Notwithstanding any omission, irregularity or deficiency in the establishment of or conferment of powers and functions on the Directorate Genera l (Intelligence and Investigation), Inland Revenue and authorities specified in section 30A, all orders passed, notices issued and actions taken, before commencement of the Finance Act, 2018, in exercise or purported exercise of the powers and functions of the officers of Inland Revenue under this Act by the Director General (Intelligence and Investigation), Inland Revenue or the authorities specified in section 30A shall be deemed to have been validly passed, issued and taken under this Act. {{FOOTNOTE}} Scope of determination
4. We have appreciated the arguments of the respective learned counsel and considered the pertinent law .
5. In Mustafa Impex , the august Supreme Court inter alia enunciated that where a power is conferred by statue on the Federal Government then such power can only be exercised exclusively by the Federal Cabinet. It was further held that fiscal notifications enhancing the levy of any tax by a Secretary or Minister are ultra vires. The PMDC "case clarified that ratio of Mustafa Impex would apply prospectively and admitted ly Mustafa Impex preceded the Impugned SRO. It is considered imperative to reiterate that the respective learned counsel remained in accord in so far as the import of Mustafa Impex was concerned; therefore, the only issue to be determined by us is whether the Impugned SRO was saved by the subsequent insertion of the relevant validation clause in the Act.
Finance Act, 2017
6. Section 3 of the Act inter alia confers the authority to declare that in respect of any taxable goods, the tax shall be charged, collected and paid in such manner and at such higher or lower rate or rates as may be specified vide a notification. Such authority was vested in the Federal Government; however , post Mustafa Impex, vide Finance Act, 2017 ("FA, 2017"), the Act was amended to confer such authority upon the Board with the approval of the Federal Minister -in-charge.
7. The FA, 2017 also inserted section 74A in the Act which stipulated that all notifications and orders issued and notified in exercise of the powers conferred upon the Federal Government, prior to commencement of FA, 2017, shall be deemed to have been validly issued and notified in exercise of such powers.
8. It is pertinent to highlight at this juncture that the substitution of Federal Government with Board with the approval of the Federal Minister-in-charge and insertion of section 74A in the Act took place simultaneously vide the FA, 2017; and the Impugned SRO was issued subsequently , post conferment of such authority upon the Board with the approval of the Federal Minister-in-charge.
Finance Act, 2018
9. The Finance Act, 2018 ("FA, 2018") reversed the conferment of authority , upon the Board with the approval of the Federal Minister-in- {{FOOTNOTE}} PMDC v . Federation of Pakistan reported as 2018 SCMR 1956 . {{FOOTNOTE}} charge , and reinstated the relevant competence upon the Federal Government .
10. In so far as section 74A was concerned, FA, 2018 substituted the figure of 2017 therein with 2018. As a consequence thereof section 74A now read to state that all notifications and orders issued and notified in exercise of the powers conferred upon the Federal Government, prior to commencement of FA, 2018, shall be deemed to have been validly issued and notified in exercise of such powers.
Section 74A - import of Finance Act, 2017 and Finance Act, 2018
11. It is observed that the Impugned SRO was issued by the Board with the approval of the Federal Minister-in- charge, post conferment of authority there on vide amendments undertaken vide FA, 2017. In so far as the original text of section 74A was concerned, it provided no benefit to the Impugned SRO since the effect was to be in respect of notifications and orders issued and notified prior to commencement of F A, 2017.
12. The FA, 2018 extended the ambit of section 74A of the Act but only in so far as the period was concerned; i.e. in respect of notifications and orders issued and notified prior to commencement of FA, 2018. However , the crucial point to consider is that section 74A of the Act sought to validate notifications and orders issued and notified in exercise of powers conferred upon the Federal Government. At the time that the Impugned SRO was issued the relevant power was not conferred upon the Federal Government; therefore, the instrument was admittedly never issued in exercise of any power conferred upon the Federal Government.
13. Section 74A of the Act was amended vide the FA, 2018, however , it is prima facie evident from the verbiage thereof that it affords no protection to any notification or order issued and notified in exercise of powers conferred upon the Board with the approval of the Federal Minister -in-charge . The august Court has held5 that a statute was the edict of the legislature and the langua ge employed in the statute was determinative of the legislative intent. In view of the glaring omission of the legislature to save any notification issued and notified in exercise of powers conferred upon the Board with the approval of the Federal Minister-in-charge, it is observed that nothing has been placed before us to suggest that ambit of section 74A of the Act af fords any protection to the Impugned SRO. {{FOOTNOTE}}
14. Per Saqib Nisar J (as he then was) in Pakistan Television v. Commissioner Inland Revenue, reported as 2017 SCMR 1 145. {{FOOTNOTE}} Pari materia judicial edicts
14. In Premier Systems' , a Division Bench of this Court was seized of a similar matter , albeit in the analogous context of the Customs Act, 1969, wherein the competence of the Board with the approval of the Federal Minister - in-charge was under challenge. Munib Akhtar , J authored the edict and struck down the statutory provision, empowering the Board with the approval of the Federal Minister-in-charge to act in place of the Federal Government, as well as the notification issued in terms of and in purported exercise of the powers conferred by the said provision.
The appeal' filed assailing Premier Systems was disposed of by the Supreme Court leaving the issue of the validation clause8 to be raised before the Courts of competent jurisdiction and to be decided on its own merit. It is imperative to note that while the validation provision inserted in the Customs Act, 1969 contained a non obstante clause seeking to give effect notwithstand ing any order or judgment of any court, including the High Courts and the Supreme Court, no such verbiage was employed by the legislature in section 74A of the Act.
15. The matter came before this Court in Dewan Motors9 and a Division Bench of this Court held that the validation clause was ultra vires to the Constitution as through the impugned amendment the legislature had attempted to validate a Constitutional defect vide legislation subordinate thereto, without making any amendment in the Constitution itself.
16. The corresponding analogous provision/s of the Act, and a notification issued thereunder , came under challenge before this Court in Al Razzaq Fibres ", wherein a Division Bench of this Court struck down the statutory provision in the Act, empowering the Board with the approval of the Federal Minister -in-charge to act in place of the Federal Government, as well as the notification issued in terms of and in purported exercise of the powers conferred by the said provision. {{FOOTNOTE}} 6 Per Munib Akhtar J in Premier Systems v . Federation of Pakistan reported as 2018 PTD 861 .
7 Civil Appeal 321 of 2018.
Inserted in the Customs Act, 1969 vide Finance Act, 2018; post rendering of Premier Systems.
9 Dewan Motors v . Federation of Pakistan ( 2021 PTD 232 )
Al Razzaq Fibres v . Federation of Pakistan ( 2021 PTD 542 ) {{FOOTNOTE}}
17. The judgment in Al Razzaq Fibres delved into the validation provision as well and held that section 74A of the Act had no relevance to the controversy since it was in respect of validation of acts of the Federal Government and afforded no protection to powers exercised by the Board with the approval of the Federal Minister -in-charge . An identical view was taken by the honorable Lahore High Court in T. U. Plastic Industry".
18. It may be appropriate to record that the pronouncements of earlier Division Benches on this Court, in Premier Systems, Dewan Motors and Al Razzaq Fibres are binding12 upon us.
Conclusion
19. It had already been conceded by the respondents' learned counsel that the Impugned SRO was hit by the ratio of Mustafa Impex; hence, the only issue before us was the import of the validation clause. The verbiage of Section 74A of the Act demonstrates that it was never inserted to afford any protection to exercise of powers exercised by the Board with the approval of the Federal Minister -in-charge'3 ; therefore, no case is made out before us to save the Impugned SRO in reliance upon section 74A of the Act.
20. In view of the reasoning and rationale herein deliberated we are of the considered view that SRO 583(1)/2017 dated 01.07.2017 is ultra vices and of no legal effect, being in violation of the law illumined by the august Supreme Court in Mustafa Impex; hence, we had determined these petitions vide our short order dated 16.04.2021. These are the reasons for our aforementioned short order .
SCHEDULE C.P. D-4663 of 2017: Superior Steel Corp. v.
Federation of Pakistan and othersC.P. D-4664 of 2017 : Rehman Steel v.
Federation of Pakistan and others C.P. D-4665 of 2017: Masood Farooq Ind. v.
Federation of Pakistan and othersC.P. D-4666 of 2017 : Standard Steel Mills v.
Federation of Pakistan and others {{FOOTNOTE}} 11 Per Shahid Karim, J in T. U. Plastic Industry Co. (Private) Limited v. Federation of Pakistan reported as 2019 PTD 1542 .
12 Multiline Associates v . Ardeshir Cowasjee and others reported as 1995 SCMR 362 .
13 As recognized earlier in Al Razzaq Fibres. {{FOOTNOTE}} C.P. D-4667 of 2017 : Sadiq Re- Rolling Mill v.
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Federation of Pakistan and others C.P. D-3737 of 2018 : Abdul Sattar Noor Muhammad and Co. v. Federation of Pakistan and othersC.P. D-3791 of 2018: A.A. Ship Breakers v.
Federation of Pakistan and others C.P. D-3833 of 2018 : Al-Hamza Steel Mills v.
Federation of Pakistan and othersC.P. D-391 1 of 2018 : Salam's International v.
Federation of Pakistan and others C.P. D-4247 of 2018 : Shabeena v. Federation of Pakistan and othersC.P. D-4562 of 2018 : Majeed and Sons Steel (Pvt.) Ltd and others v. Federation of Pakistan and others C.P. D-4565 of 2018 : Prime Ship Breakers v.
Federation of Pakistan and othersC.P. D-4566 of 2018 : Karachi Ship and Spares Co. v . Federation of Pakistan and others C.P. D-4727 of 2018 : Usman Steel (Pvt.) Ltd. v.
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Federation of Pakistan and othersC.P. D-6617 of 2018 : Fatima Enterprises v.
Federation of Pakistan and others C.P. D-6841 of 2018: Ghaf far and Co. v.
Federation of Pakistan and othersC.P. D-7378 of 2018: Hafiz Steel Re-Rolling Mills v . Federation of Pakistan and others C.P. D-7471 of 2018 : Mustafa Steel Re-Rolling Mills v . Federation of Pakistan and othersC.P. D-7472 of 2018 : Mateen International v.
Federation of Pakistan and others C.P. D-7473 of 2018 : Star Cotton Corp. (Pvt.)
Ltd v . Federation of Pakistan and othersC.P. D-7715 of 2018 : S.A. Traders v.
Federation of Pakistan and others C.P. D-7716 of 2018 : Sikandar Steel (Pvt.) Ltd v. Federation of Pakistan and othersC.P. D-8063 of 2018 :Prime Ship Breakers v.
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Federation of Pakistan and others C.P. D-8801 of 2018 : Dadan Steel v.
Federation of Pakistan and othersC.P. D-8802 of 2018 : S.S. Enterprises v.
Federation of Pakistan and others C.P. D-8959 of 2018 : Fatima Enterprises v.
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