SALEEM AKHTAR, J.--1. The petitioner is 78 years old and is a senior member of the Bar. Few years back he developed an ulcer in the heal of his right foot. He was treated in the University of Washington Hospital, Harborview Medical Centre, University Hospital, Seattle, Washington and his left leg was amputated below the knee. He thus became a disabled person. Respondent No. 5 by SRO 1101(I)/83, issued on 23rd November, 1983 under section 19 of the Customs Act and section 7 of the Sales Tax Act, 1951 exempted from whole of the customs duty and sales-tax chargeable thereon such of the motors vehicle of engine capacity not exceeding 1300 cc fitted with special gadgets for compensating disability imported by a disabled person for his own use, whom disability certificate has been issued by the Federal Disability Board (respondent No. 1). The petitioner applied to respondent No. 1 for issuance of disability certificate. In support of his application he produced his national identity card, valid driving licence, an affidavit that the car will be used by him exclusively, invoice from the manufacturer abroad, income-tax certificate and land ownership certificate duly attested by the Deputy Commissioner. The petitioner was called for interview on 24th April, 1988 when he explained to respondent No. 1 that his professional income was low in the year 1985-86 and for the year immediately preceding and succeeding that year on account of his ill health. The petitioner declared his income from profession, agriculture, rent and dividends at Rs. 150,000 per annum. He also filed tax payment receipt showing payment of Rs. 7,062 as income tax for the year 1985-86. Respondent No. 1 deferred the case and required the petitioner to produce certificate of his agricultural earning upto date and also assessment order from the Income Tax Officer for the last three preceding years. The petitioner produced all these documents.
The petitioner was again called for interview on 1st August, 1988 when he submitted copies of maps of his two bungalows one of which has been rented out to the United Nations for Rs. 6,000 per month. He also submitted documents of his plot situated in Ayubia and the plot in the Karachi Bar Cooperative Housing Society. It has been alleged that throughout the attitude of respondent No. 1 was hostile and negative and ultimately on 24th October, 1988 the application of the petitioner was rejected by respondent No. 1 which was communicated by respondent No. 2. The petitioner filed this petition on 31st January, 1989 challenging the decision of respondent No. 1.
2. The respondents have not filed any counter-affidavit. The matter came up for hearing on 28th September, 1989 when the learned Standing . Counsel pointed out that respondent No. 1 has called the petitioner on 30th September, 1989 for reconsidering the case. Accordingly the hearing was adjourned to 3rd October, 1989. On that date Mr. S.A. Wadood, the learned Deputy Attorney- General, appeared and filed an original office memorandum written by the Deputy Controller for Controller of Imports and Exports in which a reference was made to the meeting with the petitioner, on 30th September, 1989 and it was stated that respondent No. 1 has asked the petitioner to produce the following documents:--
(1) Latest income certificate duly signed by the Deputy Commissioner verifying income from 2C Kanals (Orchard) in village Qisba, Abbottabad, as the certificate produced seems to be very old and the date on photo-copy produced seems to be 10th August, 1982.
(2) Income certificate issued by Deputy Commissioner, Mansehra District shows income of Rs.
150,000 which as per statement of Mr. Aziz- ur-Rehman Khan, is the joint income from joint family property. He was asked to produce latest certificate showing separate income of each partner/family member alongwith holding of land in villages Jarid and Chanool (Tehsil Balakot).
(3) Proof of income from rent of a bungalow at Abbottabad rented out to U.N.O, on Rs. 6,000 per month and Rs. 72,000 per annum. For this income, which is taxable, Income-tax Assessment Orders and tax payment receipt, may be produced. It is further pointed out that the house was leased to U.N.O, for 2 years from 1st November, 1988 while his case was rejected on 1st August, 1988-this requires clarification.
The Deputy Attorney-General was requested to convey this information to the Court.
3. On 3rd October, 1989 the learned Deputy Attorney- General appeared but did not support the stand taken by respondent No. 1. We therefore heard the arguments of the learned counsel which had almost concluded but for want of time the hearing was adjourned to 5th October, 1989 at the joint request of the learned counsel for the parties. On this date the learned Deputy Attorney- General stated that respondent No. 1 has issued the disability certificate oh 4th October, 1989.
4. From the facts narrated it is clear that the attitude of respondent No. 1 was unreasonable and not in accordance with law. According to Mr. Makhdoom Ali Khan respondent No. 1 has acted mala fide.
He has contended that although the petitioner did not produce the documents required by respondent No. 1 in its memorandum dated 3rd October, 1989, the certificate has been issued which shows that it was withheld merely to harass the petitioner and not on any legal ground.
5. There is no dispute that under the Import Policy Order import of cars, wheel chairs and three wheelers for disabled persons on conditions notified by the Licensing Authority is permitted for actual use. Item 2.2 provides the eligibility of a person to import it and its relevant part reads as follows:- "Unless otherwise specified licence will be issued to the following: ~
(a) ...........................
(b) ....................................
(c) ...........................
(d) Actual users without import registration subject to the provisions of paragraph 2.16 if the amount for which import is to be made exceeds Rs. 25,000."
Paragraph 2.16 reads as follows:-- "Import by actual user:
(i) Actual users desiring to import any of the following items for an amount exceeding Rs. 25,000 shall submit their applications to the' Licensing Authority with an undertaking that the goods imported against licence applied for will be for their own use only. ........................... ...........................
(ii) Cars, motorised wheel chairs and three wheelers for disabled persons on condition notified by the Licensing Authority.
Such provision appeared in Import Policy of 1987 as well."
6. SRO 1101(I)/83, dated 23rd November, 1983 issued under section 19 of the Customs Act and section 7 of the Sales Tax Act which reads as follows:-- "S.R.O. 1101(I)/83.-In exercise of the powers conferred by section 19 of the Customs Act, 1969 (IV of 1969), and section 7 of the Sales Tax Act, 1951 (III of 1951) and in supersession of this Ministry's Notification No. SRO 827(I)/78, dated the 2nd October, 1978, the Federal Government is pleased to exempt, from whole of the customs duties and sales-tax chargeable thereon, such of the motor vehicles of engine capacity not exceeding 1300 cc, motorised wheel chairs and three wheelers, fitted with special gadgets for the purpose of compensating disability, hereinafter referred to as the vehicle, as is imported for his own use by a disabled person to whom a disability certificate has been issued by the Federal Disability Board consisting, of an officer possessing medical qualifications nominated by the Ministry of Health and one representative each of the Central Board of Revenue and Chief Controller of Imports and Exports subject to the following conditions, namely: ~ The vehicle shall not be sold or transferred to any person before the expiry of five years from the date of its arrival in Pakistan except-
(a) to a disabled person on production of a disability certificate from the said Federal Disability Board;
(b) to the Department of Supplies, Government of Pakistan, on the usual terms and conditions relating to such sale, or
(c) In case of death of the disabled person owning the vehicle, by any of his heirs to any person.
2. The purchaser or transferee of the vehicle, other than a disabled person or the Department of Supplies, Government of Pakistan shall pay the same customs duty and other taxes as were leviable thereon at the time of its import."
7. Section 3 of the Import and Export (Control) Act, 1950 empowers the Federal Government to regulate the import and export of goods. It has power to impose conditions for grant of import licence. In order to achieve this object orders and Notifications are issued by the Federal Government/Chief Controller, Import and Export. Import Policy Order is one such document which regulates the import. The licence is issued by the Chief Controller of Imports and Exports in accordance with the Import Policy Order. Accordingly the actual user of a car. For disabled person is entitled to apply for licence for importing it on conditions mentioned in para 2.16 reproduced above. No condition has been imposed that before applying for import licence for car for disabled person a disability certificate should be obtained. Such certificate is required if the importer wants exemption from payment of customs duty and sales-tax. It is required after the import and not before it. Under the Notification dated 23rd November, 1983 exemption can 'be granted to a disabled person .Who has imported the vehicle for actual use and has obtained disability certificate from respondent No. 1. Another condition is that it will not be sold for five years except to a disabled person having a certificate from respondent No. 1 or the Government. It further provides that persons other than disabled persons purchasing the vehicle will have to pay customs duty and sales tax, leviable at the time of import. This clearly demonstrates that respondent No. 1 is saddled with a duty to issue disability certificate certifying that the importer is a disabled person.
The stage at which respondent No. 1 is required to act, and the duty it is required to perform clearly indicates that it has nothing to do with the financial ability of an importer. While considering the importer's case in terms of Notification dated 23rd November, 1983 respondent No. 1 cannot investigate into his financial condition. This is a matter which may be taken care of by the Licensing Authority.
8. The authority of respondent No. 1 is derived from the Notification issued by the Central Board of Revenue reproduced above. The disability certificate is required by an importer if he applies for exemption from customs duty and sales tax and not for obtaining import licence. The Notification has not prescribed any guideline, rule or regulation for the purpose of granting the disability certificate. In such circumstances the Board has to exercise its discretion according to well- recognised principles of justice, equity and fairplay without being tainted with malice, mala fides or bias. The object of the Notification and the purpose for which import is allowed and exemption is granted should be kept in view while granting import licence or disability certificate.
9. Mr. Makhdoom Ali Khan has contended that the discretion should be proper and legal, on principles enunciated in N.M. Khan and another v. The Deputy Settlement Commissioner, Lahore, 1970 SCMR 158 and Manthar Jatio's case 1988 PLC (Service) 344. In the last case after an exhaustive review of several judgments following observation was made by Naimuddin, C.J. (as he then was):- "The competent authority may have discretion in the matter still the discretion has to be exercised on well-settled principles, that is, it should be exercised in good faith having regard to all relevant considerations and for public purpose and in accordance with law and it should be exercised justly, fairly and reasonably. It should not be exercised arbitrarily or capriciously."
10. An authority has to exercise his discretion taking into consideration the facts and circumstances of the case and in such manner that the remedy provided by .The Statute is advanced and not stifled. The discretion is not the whim, caprice or desire of any authority. Nor is it an unfettered and absolute power. When a discretion is vested in an authority then it is an unwritten code that it cannot be exercised arbitrarily, unreasonably or mala fide. It should be judiciously exercised.
Maxwell in Interpretation of Statutes 12th Ed. Page 146 observed as follows:- "Enactments which confer powers are so construed as to meet all attempts to abuse them, and so the Court will always be ready to inquire into the bona fides of purported exercise of a statutory power (Biddulph v. St. George's Hanover Square, Vestry, (1864) 33 LJ. Ch. 411). The modern tendency seems to be against construing statutes so as to leave the person or body upon whom a power is conferred absolutely untrammed in the exercise of it. 'A discretion', said Lord Wrenbury, does not empower a man to do what he likes merely because he is minded to do so he must in the exercise of his discretion do, not what he likes but what he ought. In other words, he must, by use of his reason, ascertain and follow the course which reason directs. He must act reasonably (Roberts v.
Hopwood, 1925 A.C. 578). In the words of Lord Macnaghten. It is well-settled that a public body invested with statutory powers.....Must take care not to exceed or abuse its power. It must keep within the limits of the authority committed to it. It must act in good faith. And it must act reasonably {Mayor, etc. Of Westminster v. L-. & N.W. Ry. Co. 1905 A.C. 426)."
It was father observed: "Even though an act done is< ostensibly in execution of a statutory power and within its letter, it will nevertheless be held not to come within the power if done otherwise than honestly and within the spirit of the enactment. A discretion is to be 'regulated, according to. Known rules of law' (Loc v.
Budo & Torrington Junction Ry. Co. 1871 L.R. 6 C.P 576), and not the mere whim <5r caprice of the person to whom it is entrusted on the assumption that he is discreet.'When', said Lord Halsbury L.C., it is said that something is to be done according to the rules of reason and justice, not according to private opinion; Rooke's Case (1598) 5 Rep. 99b); according to law and not humour. It is to be, not arbitrary, vague, and fanciful, but legal and regular. And it must be exercised within the limit, to which an honest man competent to the discharge of his office ought to confine himself (Sharp v.
Wakefield, 1891 A.C. 173).
11. These principles have neither been followed nor practised by respondent No. 1.
12. The learned Deputy Attorney-General has contended that the respondent has to take into consideration the financial resources of the applicant in order to avoid misuse of the concession granted by the Notification. It is true that such factors have to be taken into consideration not by the respondent No. 1 but by the Controller of Import and Export while granting licence. Respondent No. 1 is merely an authority to certify that the applicant is a disabled person. As the disability certificate is required for purposes of obtaining exemption it will be needed after the car has been imported. For issuing disability certificate it is completely irrelevant for respondent No. 1 to investigate the financial stability and solvency of the applicant. If a person does not wish to claim exemption he can obtain an import licence and after payment of customs duty and sales tax take delivery of the car without the intervention of respondent No. 1 which can be completely bypassed.
Respondent Authority was therefore not justified in making fishing inquiries into the financial stability of the petitioner. The conduct of the Board particularly by issuing letter on 30th September, 1989 requiring the petitioner to produce certain documents regarding financial stability and without their production and without taking any further step by the petitioner it issued the certificate, to say the least, demonstrates the irresponsible manner in which discretion was exercised completely ignoring the principles of justice, fairplay and responsibility which is expected to be practised and exhibited. For these reasons by a short order the petition was disposed of as the certificate had been issued by the respondent No. 1.