' The petitioner through this Constitutional petition has sought a declaration that the order of respondent No, 1 dated 18-7-1966 is illegal. The relevant facts are that the respondent was engaged as a contractor for an execution for construction of Rasul-Qadirabad Link Canal and a new Barrage at Rasul. The Contractor has to import material both from abroad and within the country. The same was taken to site through Rail. The petitioner was charging 12 Paisas per receipt for the goods in transit from the respondent No,
2. This arrangement went un-interrupted up to August, 1965.
Thereafter the respondent No, 2 stopped this payment of transit fees. The trouble started when the petitioner served the said respondent with notice dated 18-5-1966 calling upon it to make a payment of Rs, 3,19,315.59 as Octroi charges for the goods imported by them with 10 times penalty.
The respondent No, 2 disputed the legality of the claim. It was notified, in their reply to the aforementioned notice, that they are not liable to pay the amount as neither did material enter the Town nor did it pass through any Octroi Barrier. It was clarified that earlier the material was received by it and unloaded at Railway Station Mandi Bahauddin from there it was again loaded and dispatched to the sites but this arrangement was given up and instead the Railway Wagons as they are carried to the sites, therefore, it was not liable to pay any Octroi or transit charges. The petitioner turned down the plea of the respondent No, 2 and insisted for payment of Export duty under Rule 35 of the Municipal Committee Octroi Rules of 1964 as is clear from reply of the petitioner dated 17-5-1966. The Contractor finding no way out proceeded to make a representation to respondent No, 1, who after hearing the parties accepted the representation vide order dated 18- 7-1966. This is the order subject matter of this constitutional petition.
2. The petition was admitted to regular hearing and notices were issued to respondents. The respondent No, 2 alone has contested the petition while the respondent No, 1 was proceeded ex parte.
3. The learned counsel for the petitioner in support of the petition has argued that respondent No, 2 was under legal obligations to make a declaration to the petitioner in view of the provisions of Rule 35 of the Rules 1964. Since the respondent No, 2 failed to make the necessary declaration, therefore, it will be deemed that the goods were intended for consumption, use or sale within the Octroi limits in view of the clear text of Rule 36 of the Rules of 1964. It is submitted that the word "deemed' was interpreted by Hon'ble Supreme Court in the case of Mahreen Zaib-un-Nasa v. Land Commissioner, Multan and others PLD 1975 SC 397. It means that by legal fiction a particular fact is assumed to exist.
4. The learned counsel for the petitioner further submitted that he conveyed the order of this Court passed on 9-3-1985 to the petitioner and also framed the following questions for reply:--
(i) Whether the goods of the Company used to be unloaded at any point within the Municipal Limits while they were in transit? If the answer is in affirmative, is there any evidence of this fact?
(ii) Whether the Rasul siding of the Railway Station as mentioned in the certificate R-1 is within the Municipal Limits? If yes, please furnish a certificate to that effect.
(iii) Whether there was any arrangement at the relevant time whereby Municipal Committee's Octroi Staff/checking staff could intercept or check such goods while in transit through Railways either on the Railway Station or at any other point? Was the company supposed to make a declaration as provided by Octroi Rules?
(iv) Has there been any practice of charging for goods in transit through Railways?
5. The petitioner has replied to first two questions in the negative while 3rd question was answered in the affirmative and in reply of 4th question it was submitted that transit fee at the rate of Rs,0.12 was chargable. The learned counsel has placed on record his letter dated 21-3-1985 with the reply received from the petitioner dated 25-3-1985.
6. On the other hand the learned counsel for the respondent has argued that the Rules 35 and 36 contained in Chapter V of the Rules 1964 are not attracted in the present case and the case of his client was covered by Rules 51, 52 and 53 in Chapter VII of the Rules of 1964. The learned counsel has submitted that the Chapter V dealt with presentation of goods at Octroi Post while Chapter VII dealt with assessm ent of Octroi on Rail Borne Goods. It is submitted that there is no provision for the goods in transit in this Chapter. Therefore, his client was neither liable to pay Octroi charges nor transit fee. The learned counsel further submitted that respondent No, 1 has wrongly referred to Chapter IX and the same is not relevant. It is added that the word "deems" only creates a presumption which is rebuttable.
7. The learned counsel for the Contractor has raised a preliminary objection as to the competency of the petition. The objection is that the petitioner has alternative remedy of representation to the Government under section 111 of the Municipal Administration Ordinance, 1960, therefore, the present petition is liable to be dismissed. In this behalf the learned counsel has placed reliance on AIR 1958 SC 341.
8. The learned counsel for the petitioner, while making a reply and summing up the arguments, submitted that the whole machinery has been provided in the Rules of 1964 and there is no remedy except of an appeal, which is provided under rule 216, against the order of a committee to the Controlling Authority/Commissioner. It is, therefore, clear that the petitioner has no remedy under the rules and it rightly invoked the jurisdiction of this Court. On merits it was added that since there is no provision for goods in transit in Chapter VII, therefore, the Rule 35 as incorporated in Chapter V shall hold field.
9. I have given my anxious considerations to the arguments of the learned counsel for the parties and gone through the record and precedents relied by them. The first question for determination is whether the goods of contractor were liable to be assessed under Chapter V or Chapter VII? Before proceeding any further it is relevant to refer to Chapter V rules 35 and 36. The same read as under:-- "CHAPTER V Presentation of Goods at Octroi Posts
33. Every person importing goods liable to Octroi shall present such goods at the Octroi Post specified by the Municipal Committee for intercepting import traffic from the route by which such goods are imported.
35. When goods liable to Octroi are at an Octroi Post the person,in-charge of the goods shall declare whether the goods are intended for--
(a) consumption, use or sale within the Octroi limits;
(b) consumption, use or sale within the Octroi limits for a purpose for which an exeption is to be claimed;
(c) consumption, use or sale within the Octroi limits by a party with which Octroi has been compounded, or from which Octroi is to be charged through a bill;
(d) consumption, use or sale within the Octroi limits when the goods are imported under a re- import pass;
(e) immediate export; and
(f) temporary retention within the Octroi limits and ultimate export.
36. If no declaration is made under rule 35, it shall be deemed that the goods are intended for consumption, use or sale within the Octroi limits." While the Chapter VII, rules 50, 51, 52, 53 and 55 read as under:-- CHAPTER VII Assessm ent of Octroi on Rail Borne Goods
50. In order to intercept the traffic of goods imported by rail and liable to Octroi there shall be one of more Octroi Posts to be known as the Railway Octroi Posts.
51. When any consignment of goods is received by rail and such goods are intended for consumption, use or sale within the Octroi limits, the importer shall, before taking delivery of such goods, take the Railway receipt alongwith the Invoice to the Railway Octroi Post. If the invoice or the Railway receipt are not available, the importer may furnish a written declaration showing the details of the goods to be imported.
52. (1) When the Railway receipt and the invoice or a written declaration, as the case may be, have been presented under rule 51, the Octroi Clerk shall assess the Octroi payable, and on receipt of the assessed amount, issue an Octroi Receipt.
(2) The Railway recipt and the invoice shall be returned to the importer after the Railway receipt has been stamped with the Municipal stamp to be provided for the purpose, and the necessary entries have been made in the Register of Rail Borne Goods to be maintained under rule 58.
(3) If any declaration is presented under rule 51 it shall be filed.
53. When the delivery of the goods has been taken, the goods alongwith the Octroi Receipt issued under rule 52 shall be presented at the Railway. Octroi Post.
54. If the Octroi Clerk is satisfied that the goods presented agree with the details entered in the Octroi Receipt, he shall make the necessary entries in the Register of Rail Borne Goods, stamp the Octroi receipt, return it to the importer, and allow the goods to be imported.
55. If the goods are presented in instalments, the Octroi Clerk shall record, on the reverse of the Octroi Receipt and in the Register of Rail Borne Goods, the details of the goods presented in each instalment along with the time and date of such presentation, return the Octroi Receipt to the importer and allow the goods to be imported. When the final instalment is presented and the goods actually presented agree with the details entered in the Octroi Receipt action shall be taken as under rule 54."
10. It is clear from the bare reading of the two sets of the rules that rules contained in Chapter V are not relevant for Rail Borne Goods. The goods assessable under Chapter V are presented at the Octroi Post for assessm ent and then a declaration is made by the incharge of the goods while in case of Rail Borne Goods the Importer before taking delivery of such goods takes railway receipt alongwith invoice to the Railway Octroi Post and in the absence of invoice or railway receipt Importer furnishes a written declaration showing the details of the goods imported. Then the goods are assessed, duty paid and invoice and railway receipt returned to the Importer after stamping with the Municipal Stamp. The importer thereafter takes these documents to the Railway for delivery and after obtaining delivery presents the goods at the Railway Octroi Post for verification.
The legislature has clearly provided two sets of rules for clearance.
11. Now coming to the case in hand after August, 1965 the arrangement of the contractor was that the goods were booked for Mandi Bahauddin and after accepting the delivery of the wagons, the same were taken as it is to the sites. The only difference was that loco motive Engines used by the Importer were not of Railway but their own. This made the whole difference. Neither the goods were imported into the town nor it passed any of its Octroi Posts or Barrier. The legislature in its own wisdom has made no provision for the goods in transit in Chapter VII. The reason becomes apparent from reading of rule 51 where it is provided that when consignment of goods is received by Rail and the same are intended for consumption, use or sale within the Octroi limits then the importer shall appear before the Octroi Staff alongwith Railway receipt and Invoice. The admitted position of this case is that all the goods received by respondent No, 2 were intended for consumption at new Rasul Barrage and Rasul-Qadirabad Link Canal. The same are admittedly located outside the limits of the petitioner. Therefore, the contractor was not under any legal obligations to pay any Octroi charges or even make a declaration.
12. The argument of the learned counsel for the petitioner is that the contractor was under legal obligations to obtain the transit permit in respect of all the goods because in the absence of any provision as to the transit permit in Chapter VII, the provisions of Chapter V automatically become applicable. The argument is without any merit because both the Chapters provided a comprehensive machinery for assessment of the goods and there is no provision in Chapter VII making any provision of Chapters V applicable to the goods dealt under this Chapter. The petitioner in reply to the query No, 4 has said only yes. It has failed to quote any precedent in this behalf. The rules are clear on the point. This being fiscal law the same is to be interpreted strictly and in case of possibility of two interpretations the interpretation favourable to the subject is to be adopted. In this behalf the learned counsel has referred to the case AIR 1958 SC 341 (The Central India Spinning and Weaving and Manufacturing Co.., Ltd: The Express Mills, Nagpur, Appellants v.
The Municipal Committee, Wardha, ). In this behalf reference can also be made to the judgment of Hon'ble Supreme Court in case of Government of Pakistan v. Karachi Gas Company Ltd. 1974 SCM R 237.
13. In this view of the matter the interpretation in favour of the subject and exempting it from taxation is to be adopted. The proposition when approached from this angle, there is no merit in this petition.
14. In view of the finding recorded above, it is no stage to deal with the preliminary objection as to the competency of the representation and moreso for the reason that this petition is pending since 1967.
15. The result is that this petition is dismissed on merits. However, there is no order as to costs.