' Hajvairy Associates (Pvt.,) Ltd. And another filed this Constitutional petition against the Federation of Pakistan through Defence Secretary and Director-General, Civil Aviation Authority. On 13-11-1994, the Director-General Civil Aviation Authority (hereinafter referred to as the Authority) was asked to submit report and parawise comments, which were filed in Court on 5-12-1994. Subsequently, applications were made by the writ petitioners to implead the Airport Manager, Lahore Airport, Lahore and Shaheen Air International, Karachi as the respondents. The applications were allowed and accordingly on 21-12-1994 amended writ petition against all the four respondents was filed.
2. According to the writ petition, Hajvairy Associates (petitioner No,1) was incorporated as private limited company in the year 1991 and petitioner No,2 was incorporated in the year 1993 under the Companies Ordinance, 1984.. Petitioner No,1 and Aeroflot Russian International Airlines (hereinafter referred to as 'Aeroflot') had entered into a Pre-incorporation Agreement (copy Annexure L) on 28- 11-1992 according to which both the parties agreed to form, promote and incorporate private limited company, as a joint venture, by the name, "Hajvairy Airlines (Pvt.) Limited". According to Clause 9 of Pre-Incorporation Agreement, 51% of the share capital of the joint venture company was to be subscribed by petitioner No,1 and 49% by the Aeroflot. It is stated by Mr.Tauqir Sultan Avian, the Chief Executive of the petitioners that the joint venture company was also incorporated as a company under the Companies Ordinance, 1984. He further stated that under the Articles of Association of petitioner No,2, Aeroflot had nominated two Directors on the Board of Directors who, in the year of 1995, resigned and that at present there is no , Director on behalf of the Aeroflot on the Board of Directors.
3. On 18-1-1995, the writ petition was admitted to regular hearing. Respondents Nos.1 to 3 filed joint written statement whereas respondent No,4 filed separate written statement. Earlier the petitioners had also filed rejoinder to the parawise comments of the respondents.
4. The relevant facts are that through press advertisement respondent No,2 invited Private Sector Airlines to operate flights on Domestic and International routes and also announced policy- package, offering incentive to the Private Sector which included the following:---
(i) The domestic fares shall be de-regulated and all .Airlines allowed to operate freely on all domestic routes....
(ii) Only one Pakistani Airline shall be permitted to operate on an international air route. All locations available under. Air Services Agreements (ASAs) where a Pakistani Airline is not already operating and all new locations as may be agreed in future by Aeronautical Authorities, may be allocated to all Pakistani Airlines, on first-cumfirst-serve basis.
' New Airlines may operate on any existing international routes by agreement with the Airline already operating on that route.
5. Accordingly, Hajvairy Associates and Aeroflot on behalf of their above joint venture, made an application ' on 23-10-1992 to respondent No,2 for Licence of Air Traffic Service. In the formal application, prescribed by the Authority, the required information was supplied to respondent No, 2.
This application was also accompanied by "letter of understanding" dated 23-10-1992 (Annexure E).
In response to this application, the Authority issued. Airline Licence No, 011/92 to the applicants vide letter dated 12-11-1992 (Annexure F),This licence was valid for a period of one year. Vide challan dated 10-12-1992, the petitioners deposited Rs,16 lacs in the Habib Bank Ltd., for credit to the Authority finally vide letter dated 18-1-1993 (copy at Annexure K), the Authority permitted the petitioners to operate on domestic routes Lahore Karachi-Lahore and Islamabad-Karachi- Islamabad subject to production of Air Operator's Certificate and deposit of Route Fee in the Authority's account. Accordingly, on 21-3-1993, the petitioners operated first flight from Karachi to Islamabad and announced its regular operation with effect from 15-4-1993.
6. Before and after operating on the domestic routes, the petitioners made repeated requests to respondents Nos.! And 2 to approve its international routes. In the letter dated 30-1-1993, the Authority informed the petitioners that there was no Air Service Agreement existing between Pakistan and Belgium and no Pakistani Airline was designated on the route, that the operation on this route would be allowed on production of valid Air Operator's Certificate and deposit of route fee. Accordingly, Rs,1,60,000 were deposited by the petitioners for 1.6 were international routes and Rs,20,000 for 4 domestic routes on 18-2-1993 in the Habib Bank Limited (Annexure R).
7. It is submitted by the learned counsel for the petitioners that for the purpose of operating on the international routes, the petitioners brought into Pakistan foreign investment to the tune of U.S.$ 100 million and made arrangement for the aircrafts which were being used by Aeroflot all over the world. The petitioners also hired about 1600 employees for various jobs and set up offices at different places to operate the Airline. The petitioners had also approached their Civil Aviation and Tourism Authorities of the Emirate of Sharjah who accordingly, gave them the traffic rights in the following terms:--- "We are pleased to grant HAJVAIRY AIRLINES of Pakistan full traffic rights to operate,' Chartered & Scheduled flights into and out of Sharjah, U.A.E. And points beyond."
' This authorisation was valid for a period of one year from the date of operation. The petitioners accordingly informed respondent No 2 and requested to approve the Schedule of Flights to Sharjah but no action was taken on the petitioners' requests.
8. The trouble arose with the Authority's demand to the petitioners to pay the outstanding dues which according to the Authority were about Rs,39 million. On 24-1-1994, the Authority sent a letter to the petitioners informing that their Compulsory Security Deposit of Rs, 1.5 million was adjusted against the outstanding dues of the Authority in accordance with the Terms and Conditions of the Airline licence dated 12-11-1992 and consequently the petitioners were required to replenish the Compulsory Security Deposit of Rs, 1.5 million within one month, otherwise the Licence would stand' revoked. It appears that the same day i,e, on 24-1-1994, a meeting was held between the petitioners and the Deputy Director-General of the Authority and an amount of Rs,500,000 was also paid through bank draft to the Authority by the petitioners. However, on 27-1-1994, the Authority sent Fax message to the petitioners stating that an amount of Rs,39 million was outstanding against them on account of the Landing/Housing Charges and Embarkation Fee etc. This letter was replied by the petitioners on 29-1-1994 wherein it was, inter alia, contended that in the bills sent by the Authority major discrepancies existed, which were not being removed in spite of repeated requests, and that in the meeting held on 24-1-1994 all these issues were settled with the Director- General and the Deputy Director-General of the Authority and the payment of dues was proposed to be rescheduled. However, the rescheduled programme of payment was not accepted by the Authority as mentioned in their letter dated 27-1-1994 (Annexure X to the amended writ petition).
' It appears that nothing was done practically. In spite of exchange of respondence, the matter relating to the payment of dues and re-depositing the compulsory Security Deposit were not settled. In the month of March, 1994, e petitioner No, 1 made complaint to the learned Ombudsman, who on -3-1994 directed the petitioners to pay the outstanding dues to the respondent o.2. On 14- 11-1994 the Airline Licence No,011/92 was to expire, therefore, 13-11-1994 the petitioner No,2 applied for its renewal. But the renewal was so not granted. Meanwhile the operation of flights even on domestic routes mined suspended since the month of January, 1994.
10. Ultimately the present writ petition was filed wherein the following lief is claimed:---
(i) Order the respondents to honour their undertaking and the purpose for which the petitioners floated the Airlines. The petitioners' licence may not be cancelled except in accordance with law; which is Part. XV of Civil Aviation Rules, 1978.
(ii) The respondents are directed to approve the schedules regarding international operations and take all necessary steps including negotiating and finalizing air services agreements to ensure that all the international destinations are available to the petitioners.
(iii) That in order to facilitate smooth operation of the airline the respondents be directed to inspect the aircraft of the petitioners in Pakistan as the respondents have done in the past and to accept air worthiness certificates and other related documents issued by the relevant authorities of the concerned countries of the origin as prima facie evidence of the facts stated therein.
(iv) Respondents are directed not to dispossess the petitioners from allocated spaces at Airports.
(v) Respondents be directed to provide parking, cargo and other related facilities in order to facilitate the petitioner to use Lahore as the Operating Base as per the original understanding.
(vi) That immediate permission may be given to start international operations on already approved routes.
(vii) That the licence of the petitioners may not be cancelled and the international routes approved in favour of petitioners by the respondents may not be offered to any other Airline. Secondly, the petitioners may be allowed to operate regular scheduled flights to Sharjah, since the Sharjah Government has already permitted the petitioners to use its Airspace and Airport facilities.
(viii)That this petition may be accepted with costs.
(ix) That any other relief may be given which may be deemed appropriate by this Honourable Court.
(x) That respondent No,4 may not be allowed to operate Dubai.
11. In the written statement of respondents Nos.1 to 3 as many as 19 preliminary objections have been raised. These pertain to the maintainability of the writ petition on various grounds; locus standi of petitioners; misjoinder of the parties and non-availability with the petitioners of aeroplanes to operate on any route. It is also averred that the petitioners previously filed complaint before the learned OMBUDSMAN who directed the petitioners to deposit Rs,25 crores outstanding dues against which a representation was filed before the President of Pakistan under Article 32 of the President's Order No,1 of 1983 and that Airline Licence of the petitioners stood revoked w,e,f, 24- 1-1994; and that in any case it expired on 14-11-1994; and that there existed agreement between the parties, therefore, contractual liability could not be enforced through this Constitutional petition: Lastly it was stated that the alternate remedies under Civil Aviation Rules, 1978 and 1994 were not availed, before coming to this Court.
12. On merits respondents Nos. 1 to 3 stated in the written statement that the petitioners had to pay approximately a sum of Rs, 25 crores to them and others which they failed to pay in spite of the order dated 20-3-1994 passed by the learned Ombudsman and that the petitioners Airline Licence stood revoked in the month of February, 1994 on their failure to replenish Compulsory Security Deposit within the stipulated period, in terms of Clause 8 of the Terms and Conditions of the Airline Licence. In any case the Licence was valid only up to 14-11-1994 and was not renewed thereafter. It was also contended that the Airline Licence was granted to the joint venture, namely, "M/s. Hajvairy Associates (Pvt.) Limited-Aeroflot Joint Venture" and not to the petitioners; that the aircrafts which were being operated by the petitioners belonged to Aeroflot of Russia who had withdrawn their all aircrafts due to the default in payment of their dues amounting approximately to U.S.$ 64 million.
13. Malik Saeed Hassan, Advocate, learned counsel for the petitioners submitted that the present writ petition could not be dismissed for not having availed alternate remedy because the remedy under Rule 312 of the Civil Aviation Rules, 1978 was not available to the petitioners. He further submitted that it could also not be revoked as done by respondent No,
2. According to him, the licence was valid up to 14-11-1994 and stood automatically renewed for another year on depositing the licence fee of Rs,50,000 on 13-11-1994 in the name of the Authority which accompanied the application dated 13-11-1994 (copy at Annxure C to the Rejoinder) for the renewal of licence for the year 1994-95. According to the learned counsel for the petitioners after depositing the licence fee and submitting application on 13-11-1994, the petitioners had nothing more to do for getting the licence renewed, therefore, the renewal was automatic particularly in view of the fact that after 13- 11-1994 the petitioners did not receive any intimation refusing to renew licence. He has referred to condition No,4 of the Terms and Conditions of the Airline Licence No,011/92 demure F) which is to the following effect:---
(a) This licence is renewable annually. (b) This licence is non-transferable.
14. Learned counsel for the petitioners also submitted that the petitioners were given to understand by the Authority that the domestic routes would be renewed and the international routes granted to them. In this connection he referred to Annexure R to the amended writ petition, showing that the licence for the international routes and domestic routes as mentioned in the authority's Letter dated 9-2-1993 was deposited on 18-2-1993.
15. Learned counsel for the petitioners submitted that 'the Civil Aviation rules,1978 were silent about the renewal of the licence. However, under Rule 40 of the Civil Aviation Rules,1994 the renewal could be refused by the 'authority after due notice to the licence holder. Rule 340(2) of these Rules reads under:-- "the reasons for such a refusal shall be given in writing by the Director-General to the applicant, including a statement of the facts or circumstances that justify the refusal."
' In the strength of this Rule 340 (2), the learned counsel for the petitioners contended that neither the refusal was communicated to the petitioners nor reasons for the same nor was the statement of facts or circumstances justifying refusal to renew the licence of the petitioners given, therefore, the petitioners' Airline Licence, remained valid for at least another year after 14-11-1994.
16. On the contrary, Mr. Ljaz Ahmad Ch., learned counsel for respondents Nos.1 to 3 contended that the petitioners' Airline Licence stood revoked w,e,f, 12-2-1994 because of non-deposit of Compulsory Security within one month after 13-1-1994 when the security deposit of Rs, 1.5. Million of the petitioners was adjusted towards the outstanding dues of the Authority in accordance with the terms and conditions of the Airline Licence. He has referred to the Authority letter dated 24-1-1994 (Annexure V to the amended writ petition) whereby the petitioners were informed of the adjustment of the security deposit on 13-1-1994 under the terms of the licence and were asked to replenish Compulsory Security Deposit within one month. Since the compulsory security was not deposited within the stipulated period or even thereafter the Airline Licence of the petitioners remained revoked w,e,f, 12-2-1994. He has also referred to Condition No,8 of the Terms and Conditions of Airline Licence No,011/92 under which the Authority could adjust Compulsory Security Deposit of the licence-holder against the outstanding dues whereupon the licence-holder had to redeposit the Compulsory Security or replenish the same within one month from the date of notice failing which the licence would stand revoked.
17. The admitted position is that the Compulsory Security Deposit of the petitioners was adjusted by the Authority towards its dues in accordance with Condition No, 8 of the Terms and Conditions of Airline Licence. This provision of the Terms and Conditions of the Licence authorised the Authority to hold the Compulsory Security Deposit as permanent security during the validity of the licence and to adjust any of its outstanding dues out of the Compulsory Security Deposit and if such an action was taken by the Authority the licence-holder had to re-deposit the Compulsory Security or replenish the same so as to bring the Compulsory Security Deposit to the required level of Rs,1.5 million within the period of one month. The petitioners failed to re-deposit the amount of Compulsory Security Deposit or replenish the same to bring it to the level of Rs,1.5 million. Similarly the other dues which the Authority was demanding from the petitioners were also not paid by the petitioners. In the letter dated 27-1-1994 (Annexure X to the amended writ petition), the. Authority informed the petitioners that dues amounting to Rs,39 million were outstanding against them. This letter states that: "It may please be noted that huge dues amounting to about Rs,39 million are outstanding against you for non-payment by you of Landing/Housing Charges and your failure to reimburse Embarkation Fees collected by you on behalf of C.A.A."
18. It was in these circumstances that the petitioners submitted complaint to the learned Ombudsman against the Authority who on 20-3-1994 passed the following order:- "The complainant was asked as to how much amount according to his own calculation he owed to the Civil Aviation Authority, and others. He admitted that the amount was in the neighborhood of about Rs,25 crores: some of which was due to the Civil Aviation Authority; some to the Fuel Companies or for catering or ground handling facilities and for hiring of aircrafts etc. He was asked to make payment of these amounts first and to produce receipts before me where after a fresh date for hearing will be fixed."
' Against this order the petitioners filed Review Petition whereupon the following order was passed on 8-6-1994 by the learned Ombudsman:--- "This petition was filed by the complainant to get reviewed my order dated 20-3-1994, therein he was asked to make payments of Rs,25 crores owed to the Agency and other Fuel Companies or for catering or ground handling facilities and for hiring of aircrafts etc. Already admitted by the complainant and after production of payment receipts fresh date for hearing in the main case will be fixed.
(2) Both the parties were heard. No solid reason in support of his claim was put-forward by the complainant. Hence the review application having no forces, is accordingly dismissed."
19. It is also established on record that the dispute arose and the litigation started between the Hajvairy Associates (Private) Limited and Aeroflot, partners of the joint venture whereupon the latter intended to take out of Pakistan its aircrafts which the petitioners were operating. To restrain them from taking aircrafts out of Pakistan, Hajvairy Associates filed civil suit in the Court of IInd senior Civil Judge, Karachi South for permanent injunction. On the application of Hajvairy Associates for temporary injunction, the learned Court passed the following order on 19-2-1994:- "Perusal of Annexures A to D-1 and D-3, E, F, G, reveal that the plaintiff has not acted with prior permission and consent of the defendant but he has concealed the true facts from defendant, not only dishonestly but also malafidely. He has filed a Form 29 under Companies Ordinance, 1984 which so that the plaintiff has not come for seeking and interim injunction with clean hand. Plaintiff himself admitted that he has not paid lease money as required under the incorporated agreement, due to heavy losses. It has further appeared that plaintiff has also not informed about increase of the capital from 500 to 500 (sic) to the defendant. Otherwise I have no hesitation to say that plaintiff has no prima facie case, whereas it is also an admitted position that the operation of aircraft bearing No,II-86, TU-154M have been suspended by the defendant w,e,f, 2-1-1994 and 23-1- 1994 respectively, and the lease agreement has also been expired on 30-1-1994 being valid up to the said date. Hence the plaintiff's application itself has become infructuous and rather than prima facie. Plaintiff has also no legal character under section 42 of Specific Relief Act, beside of arguable case.
' I have gone through the authorities cited by both the counsel and have reason to say that the authorities referred by plaintiff's counsel are not concerned with the case of plaintiff.
' The upshot of the above discussion is that the plaintiff is not entitled for temporary injunction as he has not come with clean hand and being a third party. He has no right to file any proceeding in respect of lease agreement.
' The Aircraft being the property State of Russian Federation cannot be restrained, by temporary injunction and under the International Law Aircraft of any foretime injunction. Plaintiff being stranger is not defendant. Application under consideration has no merits which stands dismissed as no order to costs."
20. On 9-2-1994 the 'Manager for Pakistan of Aeroflot International ' Airlines wrote a letter to the Authority (copy at Annexure VI to the written statement of respondent No,4), inter alia, stating:- "We are bringing the above facts to your notice with a view to bring the true position to you and to request you that since the licence was granted to Joint Venture Company and since there was in law no Joint Venture Company and also since Mr. Awan has in fact violated his covenants with Civil Aviation Authority by not paying their dues and since he has been filing fraudulent cheques which repeatedly bounced, the licence may be cancelled in accordance with the law.'
21. From the above narration, the clear position emerging is that the Airline Licence was supplied by Hajvairy Associates (Private) Limited, petitioner No,1, and its Russian partner, namely, Aeroflot Russian International Airlines for the Joint Venture Company, named "Hajvairy Airlines (Private)
Limited". The Airline Licence NO.011/92 was, however, issued in the name of M/s. Hajvairy Associates (Pvt.) Ltd. Aeroflot Joint Venture" for a period of one year w,e,f, 12-11-1992 on the joint application of the two partners of the joint venture as is evident from the Licence dated 12-11-1992 (copy at Annexure F to the amended writ petition). This Licence was renewed for another year. The parties to the Joint Venture entered into a Pre-Incorporation Agreement (Annexure L to the amended writ petition) which, inter alia, provided that:-
1. The parties shall jointly establish and operate an Airline in Pakistan in accordance with the terms and conditions stipulated in this Agreement. For this purpose, the parties had submitted a joint application to the Civil Aviation Authority of Pakistan CAA' and the CAA has granted 'Licence in the name of Hajvairy Associates (Pvt.) Ltd.---(Aeroflot Joint Venture, dated 12th November, 1992.
6. The parties shall jointly promote. And incorporate or cause to be incorporated a private limited company to be named Hajvairy Airlines (Private) Limited 22. It is stated by the petitioners that the Joint Venture Company was formed and incorporated in accordance with Pre-Incorporation Agreement and the Companies Ordinance, 1984. However, the legal status of petitioner No,2, Hajvairy Airlines (Pvt.) Ltd. Has become doubtful in view of the letter of the Manager for Pakistan of Aeroflot dated 9-2-1994 sent to the Authority which states:--- "During all this period Aeroflot was led to believe by Mr. Tauqir Sultan Awan that Aeroflot is a shareholder and the HAL is a joint venture whereas neither in fact nor in law it was so. The HAL has all along been managed by Mr. Awan to the total exclusion of Aeroflot and in a way violative of the Pre-Incorporation Agreement."
23. From the record before me, it is manifest that at the time when the writ non was filed the Airline Licence No,011/92 stood revoked in terms of the authority's aforesaid letter dated 24-1-1994 (Annexure V to the amended writ petition). The Authority under Condititon No,8 of the Terms and Conditions of Licence adjusted the petitioners' amount of Compulsory Security Deposit other dues and required the licence-holder to re-deposit the amount of Compulsory Security. This was not done by the petitioners nor were the other does paid by the petitioners to the Authority as is evident from the order of the bed Ombudsman referred to above Thus, besides the fact that the liability not discharged, the financial viability of the petitioners appeared to be such an Airline could not be operated by them either on domestic or international debutes.
24. The petitioners established their Airline with five aircrafts brought in Pakistan by the Aeroflot a partner in the joint venture, with whom the petitioner 1 had entered into a separate Lease Agreement for These aircrafts which tired on 31-12-1993, where after the Lease was statedly renewed for further months. However, all these aircrafts were initially grounded by the Russian lots, who operated the same, in the month of January, 1994 and were sequently taken away to Russia as also indicated in the aforesaid order of the d Senior Civil Judge, Karachi dated 19-2-1994. Mr. Tauqir Sultan has, however stated that under Pre-Incorporation Agreement, Aeroflot was bound to vide these aircrafts for five years, although for some technical reasons, the for the aircrafts was executed only for six months at a time. He further that the last lease period was up to 30-6-1994.
25. The written statement was also filed on behalf of Shaheen Air international, respondent No,4, wherein some of the preliminary objections, as re taken by respondents Nos.1 to 3 in their written Statement, were repeated. Qureshi Muhammad Hafiz, Advocate, learned counsel for the respondent No,4 submitted that the permission to operate three flights in a week on the international routes i,e, Peshawar-Dubai-Peshawar was granted to respondent o.4 by the competent Authority with the consent of the Federal Government. The further submitted that the only relief claimed by the petitioners against respondent No,4 is, "That respondent No,4 may not be allowed to operate Dubai". According to the learned counsel, respondent No,4 has been operating Peshawar-Dubai-Peshawar route with the consent of the P.I.A. Who had prior permission to operate on this route, and with the approval of the competent authority after it fulfilled all the necessary conditions and that the petitioners ere never allowed to operate, on this route before permission was granted to respondent No,4 to operate.
26. The submission of Mr. Ijaz Ahmad Chaudhary, Advocate, learned counsel for respondents Nos.1 to 3, that by virtue of the Authority's letter dated 4-1-1994, the Airline Licence stood revoked, appears to be correct as the petitioners failed to deposit/replenish the Compulsory Security Deposit within one month from the date of adjustment, as the previously deposited amount of the Compulsory Security Deposit of 1.5 million of the petitioners was adjusted by the Authority against its outstanding dues on 13-1-1994. In any case the Airline Licence stood revoked w,e,f, 24-2-1994, considering the Authority's letter dated 24-1-1994, a notice of 30 days as well.
27. The petitioners admittedly did not avail the alternate remedies provided under the Civil Aviation Rules, 1978. Under Rule 312 the petitioners could demand review of the adverse orders, including adjustment of the Compulsory Security Deposit and fresh demand to re-deposit the same, by the Board of Review. Rule 384 provided remedy by way of appeal to the Federal Government against the order or action taken by the Authority. This rule is as follows:--- "Any person aggrieved by any order passed or action taken by the Director-General under these rules may appeal to the Federal Government and the Federal Government shall have the power to modify or annul the order appealed against or issue direction to the Director-General as to the manner in which such action is to be taken by him."
28. The aforesaid Rules were repealed and replaced by the Civil Aviation Rules, 1994 w,e,f, 3-10-1994 which also provided remedy by way of Review to the Board of Review. The relevant Rule reads as follows:--- "343. Board of Review.---(1) A person aggrieved by a refusal by the Director-General to grant or renew his licence under Part V of these rules, or by the suspension or cancellation of his licence under rule 342 may request that the matter be considered by a Board of Review except that a request made by a person who had the granting or renewal of a licence refused under clauses (b),
(c) or (d) of sub-rule (1) of rule 340, shall not be entitled to make such a request. A request under this rule shall be lodged within fourteen days of the notification and shall be submitted to the Director-General in writing together with a deposit of two thousand five hundred rupees."
28-A These remedies were not availed by the petitioners before filing the present writ petition, although these appear to be adequate and proper to resolve the disputed questions of facts involved in this case. On this ground alone the writ petition is liable to be dismissed.
28-B Lastly the learned counsel for the petitioners vehemently argued that the principle of "Promissory Estoppel" operated against the respondents inasmuch as they by conduct and representation made the petitioners believe that on undertaking operation on domestic routes, they would be allowed to operate on international routes simultaneously. This created right in the petitioners to operate on both these routes for which Licence ought to have been granted. In this connection he referred to "Federation of Pakistan and others v. Ch.Muhammad Islam and others"
1986 SCM R 916 wherein the Hon'ble Supreme Court was pleased to observe as follows:- "An agency or Authority not empowered to override or impair vested rights cannot achieve that end simply by giving its dispensation in the form of a declaration."
' Such a vested right was protected and preserved in the case of Union of India and others v. Anglo- Afghan Agencies AIR '1968 SC 718 by invoking in aid the principle of promissory estoppel in the words that follow:--- ...We hold that the claim of the respondents is appropriately founded upon the equity which arises in their favour as a result of the representation made on behalf of the Union of India, in the Export Promotion Scheme, and the action taken by the respondents acting upon that representation under the belief that the Government would carry out the representation made by it. On the facts proved in this, case, no ground has been suggested before the Court for exempting the Government from the equity arising out of the acts done by the exporters to their prejudice relying upon the representation. This principle has been recognised by the Court in India and by the Judicial Committee of the Privy Council in several cases."
29. Learned counsel for the petitioners also referred to "Pakistan through Secretary, Ministry of Commerce and 2 others v. Salahuddin and 3 others" PLD 1991 SC 546 wherein the Hon'ble Supreme Court has observed as follows:--- ' "The contention of the learned Deputy Attorney-General that the doctrine of promissory estoppel does not extend to legislative, executive or sovereign functions of the State is correct to the extent that it does not indeed extend to legislative and sovereign functions, but executive actions are not excluded from the operation of the doctrine."
' It is further held that:- "The doctrine of Promissory estoppel' is subject to the following limitation none of which is attracted in these appeals before us:---
(1) The doctrine of Promissory Estoppel cannot be invoked against the Legislature or the laws framed by it because the Legislature cannot make a representation;
(2) promissory estoppel cannot be invoked for directing the doing of the thing which was against law when, the representation was made or the promise held out;
(3) no agency or authority can be held bound by a. Promise or representation not lawfully extended or given;
(4) the doctrine of Promissory Estoppel will not apply where no steps have been taken consequent to the representation or inducement so as to irrevocably commit the property or the reputation of the party invoking it; and
(5) the party which has indulged in fraud or collusion for obtaining some benefits under the representation cannot be rewarded by the enforcement of the promise."
30. Relying upon the aforesaid judgment of the Hon'ble Supreme Court, learned counsel for the petitioners submitted that the respondents by their conduct and representation gave understanding to the petitioners that their licence would be renewed annually and that they would be allowed to operate on the domestic and international routes. According to him it was for that purpose that the respondents asked the petitioners to give choice for the international routes and pay fees for the same which was accordingly done by the petitioners. He further submitted that it is known to the respondents that the domestic routes in Pakistan are not profitable, therefore, to compensate them the Airlines are allowed to operate on' international routes which earn profits.
31. The Hon'ble Supreme Court has held in "Pakistan through Secretary, Ministry of Commerce and 2 others v. Salahuddin and 3 others" (PLD 1991 SC 546) that the doctrine of 'Promissory Estoppel' would not apply where no steps were taken consequent to the representation or inducement: It is established on record that the petitioners/licence-holders in the present case failed to fulfil the necessary conditions. They were found liable to pay huge amount to the respondent No,2, and others, which entitled respondent No,2 to invoke Condition No, 8 of the Terms and Conditions of the Licence and to adjust Compulsory Security Deposit against their dues. In spite of this adjustment the claim of respondent No,2 against the licence-holder, at least to the extent of admitted liability, remains unsatisfied uptil now.
32. With regard to the objection of the learned counsel for respondents Nos.1 to 3 that the claim of the petitioners being based on the provisions of the contract executed between them and respondent No,2, the contractual obligations, if any, cannot be enforced through a writ petition under Article 199 of the Constitution of Islamic Republic of Pakistan, 1973, suffice it to say that the obligations of the parties are, in the final analysis, based on the Statutory Rules, such as the Civil Aviation Rules of 1978 and 1994 and other legal documents, therefore, to enforce such contractual liabilities the writ petition is competent. This objection appears to be misconceived and is not, therefore, entertained.
33. The learned counsel for respondents Nos.1 to 3 has also argued that the petitioners have no locus standi to file the present writ petition and to get the relief as claimed for. According to him, the application for Airline Licence was made by and the Airline Licence No, 011/92 was issued in the name of "M/s. Hajvairy Associates (Pvt.) Ltd. (Aeroflot Joint Venture)", a joint venture of petitioner No,1 and the Aeroflot, whereas the writ petition has been filed by Hajvairy Associates (Pvt.) Ltd. And Hajvairy Airlines (Pvt.) Ltd. Through Mr. Tauqir Sultan Awan, Chairman and Chief Executive, Nawa-i- Waqt Building, 4-Shahra-e-Fatima Jinnah, Lahore. He submitted that petitioner No,2 is not a company incorporated under the Companies Ordinance, 1984 in accordance with the Pre- Incorporation Agreement. The objection of the learned counsel for respondents Nos.1 to 3 is not correct. According, to Mr. Tauqir Sultan the petitioner No, 2 was formed by the petitioner No,1 and the Aeroflot; and was subsequently incorporated under the Companies Ordinance, 1984 in terms of the Pre-Incorporation Agreement. The licence is said to have been renewed in the year 1993 in the name of petitioner No,2, therefore, the petitioner No,2 could apply for further renewal of the licence.
This objection is, therefore; overruled. However, it appears that the Aeroflot, the only other shareholder in the Joint Venture Company i,e, the petitioner No,2, is not presently associated with the business and affairs of petitioner No,2.
34. The fact remains that none of the petitioners deposited the amount of security as demanded by the Authority through its letter dated 24-1-1994 nor were financial liabilities discharged at any time by them as mentioned in the Authority letter dated 27-2-1994 and the order of the learned Ombudsman dated 20-3-1994. It is admitted by Mr. Tauqir Sultan Awan that the amount of Rs, 39 million as demanded by respondent No,2 has not been paid to them by the petitioners, as according to him, the amount was not finally determined. The petitioners' application dated 13-11- 1994 for renewal of licence had become irrelevant in view of the letter dated 24-1-1994 of the Authority according to which the petitioners were required to re-deposit/replenish the amount of Compulsory Security within 30 days, but this was not done. Similarly, no amount was paid to respondent No,2 against Rs, 39 million as demanded by them through letter dated 27-1-1994. Since the Airline Licence stood revoked under the Authority's letter dated 24-1-1994, which according to me became effective on 24-2-1994, the demand for renewal on 13-11-1994 was legitimately not accepted by respondent No,2. Besides, during intervening period many events took place. Aeroflot, the only other partner of the joint venture company, has dissociated itself with the business and affairs of the joint venture company and has taken away its fleet of aircraft which has left the petitioners without any aircraft. It is established on record and admitted by the petitioners that since the month of January, 1994, the petitioners did not operate flights even on domestic routes because the aircrafts were initially grounded by the Russian pilots and subsequently taken away from Pakistan. Even according to Mr. Tauqir Sultan the lease for these aircrafts expired on 30-6- 1994 which was not renewed/extended thereafter. The legal existence of petitioner No,2 has also become doubtful inasmuch as the Directors of the Aeroflot have also been resigned and fresh nomination has not so far been made, which has made the Board of Directors legally non-existent or in any case non-functional. There is nothing on record to indicate that Aeroflot is again willing to participate in the joint venture with petitioner No,1 and induct its aircrafts again.
35. Taking into consideration all these factors which are discussed in the preceding paragraphs, this writ petition has no merit and is accordingly dismissed without any order as to costs.