' SARDAR MUHAMMAD RAZA, J.----M/s. Wil'y Foods (Pvt.) Limited were formed into a Company by the Joint Registrar of Companies through certificate of incorporation issued on the 8th day of November, 1992 based on the Memorandum and Articles of Association so offered. The Company was to carry on the business and manufacture of all kinds of foodstuffs including Jams, Jellys and Pickles etc. The site of industry was to be located at Industrial Estate Hatter, Haripur with its Head Office in Model Town, Lahore.
2. When the Company got incorporated, a Notification No,SRO 580(1)/91 dated 27-6-1991 issued by the Federal Government under section 13(1) of Sales Tax Act, 1990 was in field whereby all the goods produced or manufactured by such industries set up between the Ist of July, 1991 to 30th of June, 1996 were to be exempt from the payment of sales tax for a period of five years from the date, the Industry was set-up. This related to the Industries in different areas including the North-West Frontier Province. M/s. Wily Foods (Pvt) Limited was set up accordingly but another Notification No,SRO 561 (1)/94 dated 19-6-1994 was issued whereby the aforesaid exemption granted was restricted to the Industries set up between the Ist of July, 1991 and 30th of June, 1994. This happened to adversely affect M/s. Wily Food (Pvt) Limited because, as per the explanation of word "set-up", the Industry had gone into trial production on 30-5-1995. The authorities concerned demanded the payment of sales tax and hence the subsequent Notification dated 19-6-1994 is challenged by M/s. Wily Foods (Pvt) Limited before this Court under Article 199 of the Constitution.
3. The simple claim of the petitioner-Company is that under the incentive given through Notification No, SRO 580 (1)/91 dated 27-6-1991, they had initiated to install an Industry at Industrial Estate Hattar, Haripur and had gone into production in-between the period of Ist July, 1991 to 30th of June, 1996 and hence were exempt from payment of sales tax for a period of five years. That such exemption could not be withdrawn through the subsequent Notification aforesaid dated 19- 6-1994, on the ground that an important right had stood accrued to the Company.
4. Learned counsel for the petitioner relied upon Collector, Central Excise v. Azizuddin Industries Chittagong (PLD 1970 Supreme Court 439-B). We had an opportunity of going through this judgment and observed that although Azizuddin Industries were established at Chittagong and subsequently shifted to Chittagong Hill Tracts and the circumstances are clearly distinguishable yet the Supreme Court had settled down the principle that a person acquiring vested right of exemption from levy of excise duty for a given period of time could not be deprived of such right. It was so settled with reference to section 21 of the General Clauses Act and held that although an authority passing some order does have the authority to withdraw the same but such power cannot be exercised, once a right is accrued to someone. In the light of this principle we will have to see as to what right, if any, had accrued to the petitioner-Company and also as to what is meant by an accrual of right.
5. Al Samrez Enterprise v. Federation of Pakistan (1986 SCM R 1917) is a famous case which defines exemption in the light of "Corpus Juris Scandium and it has amicably gone to define the terms" liability, non-liability, immunity and exemption." It also made a reference to Azizuddin's case and ultimately held a firm view that if in the light of a pre-existing Notification granting exemption, a binding contract is entered into by the A party concerned or steps had been taken by such party creating a vested right qua such Notification, the same could not be taken away on the ground that under section 21 of the General Clauses Act the Government had the power. In brief, an exemption could not be withdrawn when contractual commitment has taken place in the light of the facilities given.
6. A similar view was taken by the Supreme Court in Army Welfare Sugar Mills v. Federation of Pakistan (1992 SCM R 1652) that an authority competent to make order has power to undo it but the order cannot be withdrawn or rescinded once it has taken legal effect and certain rights are created in favour of any individual. Having gone through the case-law, we are convinced that an order cannot be rescinded, altered, withdrawn or modified to the detriment of a party concerned after when the principle of promissory estoppel comes into play. In the case of Army Welfare Sugar Mills, the Supreme Court has given certain conditions under which the principle of promissory estoppel is not attracted. The first is the Legislature which is not involved in the instant case. The principle of promissory estoppel is not attracted for doing an illegal thing and cannot be applied against a promise not lawfully extended. In the instant case these two conditions also are not applicable. The fourth condition is that the principle of promissory estoppel cannot be invoked by a party that happened to obtain such promise or representation through fraud. This also is not applicable to the present case because the exemption was never obtained by the petitioner-firm at all and not through fraud of course. The last but not the least is the condition that the principle of promissory estoppel will not apply where no steps have been taken consequent to the representation or inducement, so as to irrevocable commit the property or reputation of the party invoking it.
7. The aforesaid last principle is almost the same which is finally determined in case of Al-Samrez Enterprise and thus we have to see as to whether any act was done by the petitioner-Company under the incentive given by the Notification granting exemption and as to whether such company had made any commitments binding thereon as well as irrevocable.
8. It is an admitted fact that the Notification granting exemption and relevant to the petitioners' case is that issued on 27-6-1991 in the light whereof, any business concern was required to be set up between Ist of July, 1991 to 30th of June, 1996. It was after the issuance of this Notification that the present company was incorporated on 8-11-1992. It was after such exemption that the present company obtained a plot for the installation of Industry at Industrial Estate, Hattar on 1-3-1993 through a lease deed between the company and the Governor of N.-W.F.P. Plot No,150 so obtained measured 1 acre (8 Kanals) and was leased out for 99 years with effect from the 23rd day of December, 1992. The petitioner-Company further entered into an agreement for the purchase of entire machinery to be installed in the Industry with Manka System Developers, Lahore. Such agreement was entered into on 5-2-1994 i,e, prior to the issuance of impugned Notification of withdrawal of exemption dated 19-6-1994. Subsequently the petitioner-Company went into trial production on 30-5-1995 which squarely fell within the ambit of the initial Notification No,SRO 580(1)/91, dated 27-6-1991.
9. All the aforesaid major actions were taken by the petitioner after the issuance of Notification of exemption on 27-6-1991. A one acre plot for the installation of Industry was obtained and an agreement of sale of entire machinery was entered into with Manka System Developers, Lahore. A perusal of such agreement would reveal that it was binding upon the parties thereto. Such were the material commitments made by. The petitioner-Company before the issuance of Notification withdrawing such exemption. The subsequent Notification, therefore, is hit by the principle of promissory estoppel qua the petitioner and the exemption cannot be withdrawn on grounds of powers derived from section 21 of the General Clauses Act.
10. A very important question has struck our minds, although not agitated at the Bar, as to whether such exemption from the payment of sales tax was the only exemption or was the only attraction under which the industry was proposed to be installed and hence was a deciding factor. There could be many other attractions as well which -might have motivated the petitioner-Company to install the industry and hence, whether or not, the entire motivation could be attributed to such exemption alone.
11. No doubt, there might be other attractions for the Enterprise, like Tax Holiday, exemption from custom duty etc. Qua installation of Industry in a backward area like Industrial Estate, Hattar which might have given incentive to petitioner-Industry or almost all the other Industries installed in the Industrial Estate, Hattar and exemption from payment of sales tax might not be the only incentive involved yet this exemption is one of the many attractions offered by the Government and is not capable of being isolated from the entire package offered to the Enterprise. It is the sum-total of all the exemptions, tax holidays and facilities that attract the entrepreneurs and hence is to be taken in its totality.
12. The aforesaid reason attains all the more important dimensions when one observes that the incidence of a sales tax is on the producer/manufacturer but the impact thereof is on the consumer. The burden is shifted to the consumer by an increase in the price. Thereafter, in a state of competition in the market with industries placed in similar situation, the prices fixed by an industry enjoying exemption shall be much lower than the prices fixed by an industry denied such exemption. The petitioner-firm has referred to such industries in competition with it, namely, Tops Foods and 'Beverages, (ii) Hattar Food Factory and (iii) Quince Food Limited.
13. All business concerns created under similar incentives given, involved in similar business and production are entitled to equal facilities specially when the facilities are offered by the Government itself. Different treatment meted out to different concerns involved in similar business and thereby facilitating one to get an edge over the other, is a clear discrimination offending the provisions of Article 25 of the Constitution.
14. In Asharwani's case (1991 SCM R 1041-D) a similar view was taken by the Supreme Court, further elaborating that any classification made qua such business concerns is bound to be a reasonable classification based on reasonable distinction and reasonable basis. In Central Board of Revenue v.
7-Up Bottlers (1996 SCM R 700), the same principle of equality before law was reiterated by the Supreme Court with reference to Article 25 of the Constitution and it was impressed that a duty is cast on the Government to ensure enactment of laws which shall provide equal protection to all citizens.
15. In view of the circumstances of the present case, we hold that the petitioner-Company is entitled to the exemption granted by SRO No,580-(1)/91, dated 27-6-1991 and the subsequent Notification No, SRO 561(1)/94 dated 19-6-1994 is ineffective upon the rights having already accrued to the petitioner. We would, therefore, accept this writ petition to the above effect.