' Petitioner is a contractor of respondent No,3 and under a written agreement (Annexure "A"), is entitled to collect the octroi duty in the name and on behalf of respondent No,3. The contract has been entered into and is governed by the provisions of the Punjab Local Councils (Lease) Rules, 1990, promulgated by Governor of Punjab in exercise of the powers conferred under section 144 read with section 167 of the Punjab Local Government Ordinance, 1979 (VI of 1979), hereinafter referred to as the Ordinance. (For the purpose of convenience the petitioner is referred to as the lessee while respondent No,3 as lessor). The lessee bid for and obtained the right to collect the octroi for the period from 1-7-1995 to 30-6-1996. The lessee has stated in this petition that respondent No,5 under a contract with the Government of Pakistan, is constructing a motorway. A stretch of about three kilometres of this motorway passes through the territory of the lessor- Committee. Respondent No,5 brings within the territory of the respondent/lessor-Committee, the construction material like earth, bitumen etc. For laying down the motorway. The petitioner-lessee has been demanding the payment of octroi on such goods and machinery and respondent No,5 has been resisting it. It is stated that the matter was off and on considered/negotiated and finally vide Memo. No,SOVI(LG)7-9/92, dated 7-2-1996, issued under the signatures of Sohail Ahmad, Additional Secretary-II, respondent-Government wrote to the Administrator/respondent Committee lessor informing him that "In view of the importance of the Project, the Articles of the Project of Daewoo Corporation are exempted from Octroi". Aggrieved the lessee-contractor has filed this petition under Article 199 of the Constitution for a declaration that this order of respondent-Government dated 7-2-1996 is without lawful authority and is of no legal effect. A further declaration is sought that respondent No,5 is liable to pay the octroi tax. It is also prayed that the Administrator-respondent-Committee-lessor be directed to take appropriate action on the application of petitioner dated 18-2-1996. It may be noted here that in this application (copy Annexure "E"), the petitioner has requested the Administrator-respondent-Committee to take suitable action under the relevant provisions of the Ordinance, 1979, against respondent No,5 for evasion of the octroi duty.
2. In its report and parawise comments respondent No,1 (Government of Punjab) has defended its order and has maintained that since Lahore-Islamabad Motorway Project is of national importance, the exemption was necessary. It is also stated that in fact the original exemption was made in 1992 and the same has been extended now. In 1992 it was Mayor, Lahore Metropolitan Corporation, who was directed by the Punjab Government not to charge octroi on the articles of respondent No,5.
3. The case of respondent-Committee-lessor is that the exemption has been validly granted, that the Government has the power to exempt and that in any case the respondent-Committee is bound under the provisions of the Ordinance, 1979 to abide by the directions of the Government. It is accordingly maintained that the petitioner is not entitled to charge the octroi. Respondents Nos.4 and 5 have filed a separate written statement and they have of course supported the impugned order. They have additionally taken preliminary objections as to the locus standi of the petitioner- lessee and further that in terms of the agreement between the lessor and the lessee the lessee is estopped from claiming the octroi from respondent No,5.
4. Lengthy arguments have been addressed on the question of legality of the exemption granted.
The respondent-Government has claimed the authority to exempt from the Municipal Committee Octroi Rules, 1964, made in exercise of the powers conferred under section 36 of the erstwhile Municipal Administration Ordinance, 1960. This power is challenged on the ground at the Octroi Rules, 1964 can only survive if a similar provision of exemption exists in the Ordinance of 1979. It is urged that in the Ordinance of 1979 the Government has the authority to abolish or suspend a tax but has no such authority to exempt from the payment of tax. Comparison is made between section 36 of the Ordinance of 1960 and section 139 of the Ordinance of 1979 to show that the word "exemption" existing in the 1960 Ordinance has been omitted from the Ordinance of 1979. Reference has been made to Mukhtar Ahmad Shaikh v. Government of Sindh and others (PLD 1991 Karachi 372), which itself follows the unreported judgment of the Supreme Court dated 8-11-1989 entitled State Cement Corporation v. Abdullah & Co. (Civil Appeal No,39-K/84).
5. The relied upon judgments arose under Sindh Local Government Ordinance (XII of 1979). In that Ordinance sections 60 to 62 are parallel to sections 137 to 139 of the Punjab Ordinance of 1979.
Section 62 of the Sindh Ordinance is pari materia to section 139 and except for addition of certain words, not material to the present controversy, the substance of the two sections is almost the same. While interpreting section 62 of the Sindh Ordinance, the Supreme Court has held that there is no power of exemption with the Government. The dictum applies with equal force to the case in hand; Following the same, with profound respects, I hold that the impugned directive dated 7-2- 1996 issued by respondent-Government is without legal backing.
6. In view of the Supreme Court's Judgment, the other arguments challenging the validity of the impugned order may not be examined, although it may be added that there is considerable force in the submission of Mr. Asif Saeed Khosa, Advocate, learned counsel for the petitioner, that even if the respondent-Government did have the power to exempt under the Octroi Rules, 1964, the impugned order is still bad because that power can only be used under 1964 Rules by the Government and by issuing a notification. Admittedly in this case, although the order purports to be that of the respondent-Government, it has not been issued in the official notification.
7. However, the above declaration does not lead to the success of this Constitutional petition.
Serious objection as to the locus standi of the petitioner-lessee has been taken and lengthy arguments for and against the same have been addressed before me on number of dates of hearing. Bar of estoppel is also raised against the petitioner-lessee on the strength of clause 20 of the agreement (Annexure "A"). It is contended by Dr. Khalid Ranjha, Advocate, learned counsel for respondents Nos.4 and 5, that the petitioner-lessee cannot be permitted to wriggle out of clause 20 of the agreement. Mr. Khosa, on the contrary, has cited large number of decided cases to show that the petitioner can maintain this petition, inasmuch as, the petitioner is an aggrieved party within the meaning of Article 199 of the Constitution.
8. This question would not have assumed difficulty had the respondent-Committee not opposed this petition and its stand would have been in support of the petitioner-lessee. As it is the respondent-Committee has taken a stand not only contrary to the petitioner-lessee, but during the course of hearing its learned counsel has strongly defended the direction contained in the impugned order. It has also been maintained that respondent No,3/Committee in any case is bound to abide by the instructions of the Government which are binding upon it under the provisions of Ordinance of 1979.
9. One way of looking at this question is that the petitioner being a lessee, has the same rights as the lessor has. And if the lessor is accepting the validity of the impugned exemption, the lessee should be equally bound by it. Mr. Khosa has, however, strenuously contended to the contrary and has referred to Mian Fazal Din v. Lahore Improvement Trust, Lahore and another (PLD 1969 SC 223), to show that in order to maintain a Constitutional petition, the petitioner need not sow that he has a right in the strict juristic sense, it is enough that the impugned order/action is adverse to his interests. Dr. A.N.M. Mahmood v. The Syndicate of the University of Dacca and others (PLD 1970 Dacca 85), has also been relied for this purpose by Mr. Muhammad Hanif Niazi, Advocate, another counsel appearing for the petitioner-lessee. This Dacca judgment also gives a liberal definition to the expression "aggrieved party".
10. As I have noted, the difficulty would not have arisen had the case of the lessor and lessee be the same. The judgments in Mian Fazal Din (supra) and Dr. A.N.M. Mahmood (supra) would have clinched the issue. The divergent stand of the lessor and lessee would of necessity lead to the examination of the contract entered into between the two. This contract is Annexure "A" to the writ petition. An examination of the same shows that following clauses are relevant to the controversy and are reproduced below:- {{URDU TEXT}
11. Clause 26 is simple and only substitutes the lessee in place of the lessor in so far as the right to collect the octroi at the current rate of schedule is concerned. Clause 20 is material. Its wording clearly shows that if the Government has exempted any item to the payment of octroi, the lessee will be bound by this exemption. The question arises as to whether the lessee can be relieved of this clause in terms of the agreement in the fact and circumstances of the case. I am of the view that the lessee could have been so relieved had the lessor also challenged the impugned exemption and had sided with the petitioner in the present controversy. Left alone, the petitioner-lessee is bound by his own agreement and neither in equity nor in law he can be permitted to wriggle out of the same. It is not something as holding that the petitioner-lessee has no locus standi. In view of the fact that aggrieved party/person is being given liberal and extended meanings, the petitioner's right to maintain the petition may be there. But he has agreed to be bound by exemption under clause 20 of the agreement, and his lessor is supporting the exemption, as such he cannot be allowed to turn around and plead to the contrary.
12. Condition 19 of the agreement is again relevant. This clause contains what can be described as arbitration clause in the agreement. The lessor and lessee have serious differences as regards the grant of exemption to respondent No,5. The difference/dispute is clearly covered by the terms of clause 19. Again no valid reason has been shown as to why the petitioner should be permitted to bypass the arbitration clause and have this question resolved in these Constitutional proceedings.
It may be very well open to the lessee in proper proceedings to claim compensation/damages from his lessor on the ground that the acceptance of the impunged exemption on the part of the lessor was illegal and, therefore, has caused him serious financial losses. This claim may well be covered under clause 19 and the Arbitrator, or, if assuming that it is not so covered, the petitioner may as well maintain a civil action for recovery of compensation/damages. In view of these two clauses, I, therefore, hold that no relief can be provided to the petitioner-lessee in these proceedings even though the controversy on merits stands clinched by the judgment of the Supreme Court, noted above.
' For the above reasons, this petition is dismissed leaving the parties to bear their own costs.