' WAJIHUDDIN AHMED, J.--This petition is directed, inter alia, to challenge the realization of Export tax/Rwangi Mehsool from the petitioner Mills in relation to purchases of Sugar-cane, in turn, made by them from various and sundry growers,
2. On hearing the Petition, we had allowed the same, vide our Order dated 23-8-1989. Herein are recorded our reasons:
3. On 16-6-1983 the Chairman, District Council, Badin addressed a letter to the petitioners, enclosing an undated notification therewith and claimed that all Mills, outside District Badin, were liable to pay Export tax on Sugar-cane coming to their respective Mills for crushing from District Badin.
Schedule attached to the enclosed notification indicated the incidence of the levy on such Mills, outside the jurisdiction of District Badin, for due recovery. The petitioners objected and later appealed before the Appellate Tribunal for Sindh Local Councils, Karachi on 2-7-1983 but such tribunal, per order dated 5-1J-1983, dismissed the Appeal, basically, on the ground that the Sindh Councils (Validation of Tax) Ordinance, 1982, duly validated the levy which, accordingly, could not be questioned.
4. We find that neither the levy, in relation to its incidence on the petitioner Mills nor the Order of the Appellate Tribunal For Sindh Local Councils, aforesaid, is sustainable.
5. As per notification, dated 3-6-1980, issued under section 60(1) of the Sindh Local Government Ordinance, 1979, delegation of power of the Provincial Government, under section 60(1) ibid, has been made to the councils, where under such councils have been empowered to sanction levies, in the prescribed manner, of all or any of the taxes, tolls and fees mentioned in Schedule V to the Sindh Local Government Ordinance, 1979. The term "prescribed" has been defined in the Ordinance to mean "prescribed by rules". Neither such Ordinance nor the District Councils Export Tax Rules anywhere envisage that a purchaser of goods, such goods having moved out and crossed the limits of the District, can be made liable for or even compelled to collect Export tax in relation to the referred goods. On the contrary, the cumulative effect of Rules 17 to 20 and 47 to 52 of the District Councils Export Tax Rules would appear to be that the collection of Export Tax is to be made either through a functionary of the concerned District Council or a contractor appointed for that purpose.
It is thus clear that a District Council cannot appoint an unwilling agent to effectuate its purpose of making recovery.
6. On the other hand, it is equally clear that the incidence of the tax is at a point or points where the physical limits of the relevant district council end and other jurisdiction(s) begin. Once such limits are crossed by any goods, liable to Export Tax, the remedy of recovery, if any, attaches to the person or persons responsible to carry out such goods through such limits but bona fide purchaser(s) of the goods cannot be reached for realization or recovery of the purportedly, evaded Export Tax unless it is shown that they had collected or realized such tax at the time they came to acquire the relevant goods, in which latter event, of course, they can, in a manner appropriate, be subjected to due recovery. It is, nobody's case that any such recovery was made or deduction effected by the petitioner Mills.
7. The notification, fixing the incidence, could at best, be only persuasive in nature for effecting recoveries and making the same over. If so, voluntariness cannot be equated with duty and discretion cannot be converted into compulsion.
8. Even otherwise, under the Sugar Factories Control Rules, 1950, sugar mills cannot make any deduction from the price of sugar-cane, except for adjustment of costs of transportation or against loans advanced to the relevant grower. In this legal situation also, unless the grower was to concur in making payment of Export Tax to the purchasing sugar mills, the convenient though enforced agency of such mills, to make recoveries for the District Council, is unworkable and cannot be employed, except on contravention of the aforesaid Sugar Factories Control Rules, 1950.
As regards the defence, based on the operation of the Sind Councils (validation of Tax) Ordinance, VIII of 1982, no more need be said except that such validating Ordinance only cured procedural and technical defects and not defects of or complete lack of jurisdiction. Indeed a validating law, even if enshrined in the Constitution, cannot either be presumed or lightly inferred to have any such effect, as observed by the Supreme Court of Pakistan in Ms. Benazir Bhutto v. Pakistan PLD 1988 SC 416 and Federation of Pakistan v. Mustafa Khar PLD 1989 SC 26 wherein the dicta in Federation of Pakistan v. Saeed Ahmad Khan PLD 1974 SC 151 was re-affirmed. It is to be seen that an Export tax, as of necessity, is to be recovered at an Export Tax post, expected to be situated on the outer limit of a District Council area and can be recovered at the point of leaving such jurisdiction and never, except in the rarest of circumstances and, perhaps, by contract outsides such limit, unless, of course, law was to provide otherwise. It does not so provide either now or at any point of time earlier on. Patently, therefore, the incidence of the levy or its realization was without jurisdiction and cannot be held to be validated solely in token of the above referred validating statute.
9. It is for the foregoing reasons that we had allowed the above petition, declared the Notification DC/BDN/2263/81, dated 7-10-1982, providing for recovery of export tax from petitioners-Mehran Textile Mills Limited, in Tando Allah Yar District, Hyderabad, to be without lawful authority and of no legal effect and, as a consequential relief, directed that the sum of Rs,1,00,000 recovered by the respondent No,1, on encasing a bank guarantee in that amount, shall be refunded to the petitioner within one month.
Order accordingly. /Order accordingly.