' This judgment will dispose of Writ Petitions Nos. 17174, 21981, 22145 and 22146 of 1996, as common question of law is arising for determination.
2. In each of the petitions, the petitioner is a manufacturer of certain products having his plant/factory at Gujranwala. For the purposes of manufacture, each of the petitioner imports raw material/goods from abroad which are cleared through Dry port, Sambrial District Sialkot, and after clearance, are transported by road to the factory premises of the petitioners. While the goods leave the limits of the Zila Council, Sialkot, the consignments have to pass through the barriers and the check-posts erected/maintained by the Zila Council for the purposes of Goods Exit Tax. It is the case of the petitioner that although the goods are in transit from Dry port and are not manufactured/created/grown within the limits of the Zila Council, the respondent-Zila Council, the agent/contractor/servants compel the petitioners to pay the Exit Tax on the consignments. It is further alleged that respondents threaten to use force to compel compliance of their demand and in case of refusal the consignments are detained which results in malfunctioning of the factories and causes financial loss to the petitioners. In each of the petitions, by giving particulars with reference to the date and consignments, the amount illegally charged and recovered, is mentioned. The prayer made is that act of the respondents in subjecting such consignments to the tax be declared as without lawful authority and respondents be directed to refund the amount overcharged and also to desist from charging the same in future.
2-A. The claim in each of the petitions is contested. The respondents entered appearance in response to the notice for temporary injunction and petitions were formally admitted to regular hearing in presence of all the learned counsels on 2-12-1996 and 3-12-1996. Thereafter, the parties filed their documents which have been received on record.
3. A preliminary objection to the maintainability and grant of the petitions has been raised by Dr. Mohy-ud-Din Qazi, Advocate, learned counsel appearing for respondent No,5 on the ground that under the relevant provisions contained in the Punjab Local Government Ordinance, 1979 since repealed and re-enacted as Punjab Local Government Act, 1996, (hereinafter referred to as the Act) read with Rule 14 of the Punjab Zila Council (Goods Exit) Tax Rules, 1990 (hereinafter referred to as the rules), each of the petitioners has an adequate and alternate remedy of appeal/revision/supervision and without availing of the same the Constitutional petitions are not maintainable in terms of Article 199 of the Constitution. Learned counsel has drawn comparison of the provisions of the Ordinance and the Act, in particular section 149, read with sections 166 and 167 of the Act, to emphasize the point that the alternate remedy is adequate in the facts and circumstances of the case. Emphasis was also laid on Rule 14 ibid to highlight the argument because Rule 14 gives a right of appeal against assessment made and order passed under the Rules before the respective hierarchy mentioned therein. Rule 15 of the Rules has been read to show that a revision is also competent before the Secretary Government of the Punjab, Local Government and Rural Development Department or any officer especially authorised by him and that in exercise of the revisional power a Secretary or the authorised officer can redress the wrong such as is being pointed out in these Constitutional petitions. In reply Mr. Khalid Pervaiz Khawaja, Advocate, appearing for each of the petitioners has stated that the petitioners seek resolution of a pure legal question which ultimately will be declared law by this Court and in the circumstances the exercise of availing of alternate remedy is not that effective. It is also urged that the representations at one time or the other were made to the relevant functionaries i,e,, Commissioner as well as Secretary, Local Government, against the high-handedness of the Contractor incomplicity with the functionaries of the Zila Council but no relief has been provided to the petitioners. He has relied on Messrs Chenab Cement Product (Pvt.) Ltd. v. Banking Tribunal, Lahore and others PLD 1996 Lah. 672, a Full Bench judgment of this Court in support of the assertion that where the difficult question of law is involved which has to be resolved after interpretation of the statutory provisions, resort to alternate remedy can be dispensed with.
4. It is true that exercise of the Constitutional jurisdiction and issue of writ of mandamus, prohibition or certiorari is conditioned upon the non-availability of other adequate remedy in law. Generally speaking, therefore, a litigant must first avail of the alternate remedy available in law and can directly invoke this jurisdiction only if it is shown that the remedy, even if provided, is not adequate or efficacious. Further, efficacy and adequacy of other remedy depends upon the facts and circumstances of each case and what may be efficacious and adequate in given circumstances may not be so in other circumstances. By and large where resolution of some question of law is required to be made, direct approach to the High Court is permissible. The reason is that the persons performing functions in connection with the affairs of the Federation/Province are sometimes themselves in need of guidance from superior Courts on questions which they are required to determine. There is preponderance of judicial view that in such cases the party need not be compelled to avail of the other remedies because under the Constitution, the interpretation of law is the responsibility of the superior judiciary.
5. Applying the above test to the facts and circumstances of the present cases, I am of the opinion that although under the relevant provisions of the Act and the rules, the assessment made on the consignments of each of the petitioners can be challenged by way of appeal/revision, but decision on appeal/revision is dependent upon the interpretation of statutory rules and ultimate interpretation can only be done by this Court. During the course of hearing each of the learned counsel agreed that the point required to be determined does not seem to have been earlier- decided either by this Court or by the other High Courts or, for that matter, the Supreme Court. In any case, none of the learned counsel was able to get hold of a precedent directly applicable to the question of law involved. I further find that appeal/revision is before the executive authorities who, in the circumstances of these cases, may not be in a position to judicially decide the question involved. Reliance of the learned counsel for petitioner on the Chenab Cement Product (Pvt.)
Limited's case (supra) is appropriate and I respectfully reply upon the follow the view taken by the full Bench at page 681, which reads thus:-- ..............The remedy of appeal even if available before a Tribunal of limited jurisdiction is not effective in ousting the Constitutional jurisdiction of the superior Courts. The invocation of Constitutional jurisdiction under Article 199 is not allowed in cases where the remedy of statutory appeal is available and such remedy is effective and adequate. Even otherwise, if the right of appeal provided by statute is inadequate or is available under such conditions which has the effect of denying the right of appeal, the Constitutional jurisdiction is allowed to be invoked to afford relief to an aggrieved person in order to do justice. It is subject to these considerations that the discretionary extraordinary Constitutional jurisdiction is regulated by the High Court."
' The preliminary objection is, therefore, repelled.
6. Under section 147 of the Act, a Zila Council is entitled to levy and recover taxes on items/goods mentioned in Part II of the Second Schedule of the Act. Its item No,7, which is relevant and is reproduced below:-- "(7) Tax for the export of goods and animals from the Zila Council."
' The Punjab Zila Council (Goods Exit) Rules, 1990, have been framed under sections 144, 167 and 137 read with item No,7 of Part II of the Second Schedule of the Ordinance and were promulgated on 24-4-1990. The same have been adopted and are in force under the provisions of the Act. The Rules lay down the method of levy and recovery of the Goods Exit Tax. Under rule 5 thereof a Zila Council has the authority to levy and collect the exit tax on export of goods produced within its limits or which remained during their transit through the limits of Zila Council beyond the time allowed for the purpose under these rules. The time allowed is mentioned in sub-rule (5) which states that goods in transit shall be exported from the limits of Zila Council within 24 hours "from their entry into such limits", but the time limit may be extended by the Taxing Officer for such reasonable period as he may deem fit. Under sub-rule (6) the driver of every vehicle carrying goods liable to tax, is obliged to stop the vehicle at the tax-post. Under sub-rule (7), the Exit Tax Officer on duty at the check-post can inspect and weigh the goods presented. Under rule 6, the method of assessment of collection of tax has been provided. Rules 10 and 11 deal with inspections and checking of goods and the organization of raids. Rule 12 authorises the Taxation Officer or, with his permission, the Tax Inspector, to investigate the case of evasion. Under this rule, if the Taxation Officer is satisfied that the tax liable to payment has not been paid on any goods which have been exported from the limits of a Zila Council, a case of evasion shall be registered against the exporter of such goods and such exporter shall be called upon through notice in Form 9 to pay the tax within seven days, failing which the amount shall be recovered as arrears of land revenue. Rule 13 provides that if the Taxation Officer has reason to believe that any goods on which the tax is liable but has not been paid, he may order for seizure of such goods or seize or cause such goods to be seized. In the absence of Taxation Officer this seizure can be done by Inspecting Officer or Clerk on duty, but the latter have to immediately submit a report to the Texation Officer. The manner of release of seized goods has also been provided. Rules 14 and 15 confer a right of appeal and revision. Under rule 19, any dispute between the Zila Council and the lessee with regard to any provision of the agreement or any other matter arising out of the lease shall be decided through arbitration under the Arbitration Act, 1940, and the Commissioner has been designated as the sole Arbitrator. Under rule 20, the lessee can recover the Goods Exit tax through the Zila Council staff.
7. During the course of hearing, it was made clear by the learned counsel for the respondents that it is not the case of the Zila Council or the contractor that the goods in transit are liable to pay Exit Tax. It is agreed that the goods cleared through the Customs Dry port Sambrial, and meant for transportation outside the limits of Zila Council are goods in transit and, therefore, not liable to pay the Exit Tax. The dispute between the parties is really as to when the period of 24 hours for export of goods in transit as allowed in rule 5(5), commences. The petitioners' case is that the Dry port at Sambrial is an extension of the Karachi Port and the consignments imported through Karachi Port remain in the custody of the trustees of the Port and are physically transported from Karachi Port to Sambrial Dry port by them, either through rail or by road. The dry port at Sambrial has been established under section 9 of the Customs Act, 1969 by the Federal Government vide SRO No,308(i)/85, dated 1-4-1985. The territory thus is exclusively the Federal Government's territory and, therefore, beyond the limits of not only the Zila Council but the Provincial Government. The goods in the dry port are thus of the trustees of the port until treatment under the Customs Act/Sales Tax Act and other legal provisions is over and the goods are physically handed over to the Importer/Consignee. The consignee is duly issued a gate-pass by the Port Authorities which gives the time and date of delivery. It is, thereafter, that the vehicle leaves the port premises and enters the limits of Zila Council and, if from that time onward the vehicle drives out of the limits of Zila Council within 24 hours, the goods will be in transit and will not be liable to pay the Exit Tax.
8. On the other hand, the contention of learned counsel for respondents as well as the Assistant Advocate-General, Punjab, is that the permissible period of 24 hours will start when possession of the goods is delivered to the consignee or his agent by the Port Authorities and, according to Dr. Mohyuddin Qazi, learned counsel for the contractor, the possession should be deemed to be delivered when the payment of customs duties, Sales tax etc. Have been made/deposited. Mr. C.A.
Rehman, Advocate, appearing for the Zila Council has gone a step further. He has asserted that the period of 24 hours should reckon from the time when the consignments enter the revenue limits of District Sialkot (which is the limit of Zila Council also) either through rail or by road, while these goods are coming from Karachi. He has pointed out that such revenue limits fall somewhere between Wazirabad and Sambrial and as soon as the consignment enter District Sialkot, the permissible time of 24 hours should be deemed to commence. According to the learned counsel, if the consignments are not delivered to the consignee after clearance by the Customs within 24 hours, it is the petitioners who must suffer but Zila Council will have the right to charge the tax if 24 hours have gone by. Learned counsel was not prepared to give any allowance in time, for reasons/factors beyond the control of the importers or, for that matter, of the Customs Authorities or of the Port Authorities.
9. As noted above, rule 5(5) provides that "The goods in transit shall be exported from the limits of a Zila Council within 24 hours from their entry into such limits... ... ...". The answer, therefore, to the controversy will depend upon the question as to when the goods can be said to have entered the limits. This will have to be answered with reference to the purpose of the Act, the Rules and the application of the Customs Act and the other relevant statutory provisions. It has not been seriously contested that till their arrival in the Dry port at Sambrial, the goods and consignments remain in possession and control of the Port Trust Authorities and the importer/consignee comes into the picture when the consignments reach the Dry port. It is there that the consignments are checked, assessed and the consignee is asked to pay the amount of Import duty, Sales tax and other dues.
Once this has been done, the Trust Authorities are duly informed and it is they who thereafter, in accordance with their procedure and after recovering their dues, give physical delivery of the consignments/goods to the importer. It is clear that in all this exercise there is no room for application of the Local Government Act, 1996, or the rules framed thereunder. Consequently, neither Zila Council nor its lessee/agents come into picture. They come in the picture once the goods are "imported" into the Zila Council or "enter" the limits of Zila Council. In the facts and circumstances of the case, such import or entry only takes place once the goods are physically delivered to the consignee by the Port Authorities and they leave the limits of Dry Port.
10. There is no force in the argument of either of the learned counsel appearing for respondents that the delivery be deemed when the Customs duties etc. Are deposited. As noted prior to delivery to consignee and while the goods are on the territory of dry port, neither the Act or the Rules nor the Zila Council has any business. It is possible that after deposit, the delivery of goods is not made by the Port Trust Authorities or cannot be made or is not taken by the consignee for reasons which may be within the control of either of the parties or beyond the control of either of party. The argument of Mr. C.A. Rehman, Advocate, that the entry into limits should be construed as entry in the revenue limits of the District when the goods are with the Port Trust people and have not yet reached Dryport is too wild to attend any serious consideration. It is quite likely that after entering in the revenue limits the transport may breakdown and the goods may not reach the Dry port for number of days but, according to Mr. C.A. Rehman, such goods should be deemed liable to pay the Exit Tax after passage of 24 hours from the time of entry. The argument may be novel but, on deeper analysis, holds no water for number of reasons one of which has been recounted above.
The word "entry" in rule 5(5) is entry into the limits of Zila Council for the purposes of taking it outside the limits of Zila Council and that is why under sub-rule (6) only the driver of the vehicle has been obliged to stop. There is no rule or a direction and there cannot be one under the Act or the Rules obliging the engine driver of the Railway to stop at the entry point of District Sialkot. The arguments is too frivolous to need further examination.
11. For the reasons noted, above, it is held and declared that the permissible time to 24 hours or the extended time under sub-rule (5) will commence as soon as the consignments leave the Dry port premises and not before. If the consignments clear out of limits of Zila Council within 24 hours or the extended time the same are not liable to pay any Exit Tax under the Act or the Rules. Any demand of the respondents on such consignment will be illegal and is hereby so declared. It is further directed that claims of refund of the petitioners shall now be processed in the light of this judgment and any amount illegally recovered will be refunded to each of the petitioners within three weeks from the date of submission of the claim or this judgment. Respondents are further restrained from charging any Exit Tax on consignments in transit, as explained in the, judgment.
12. Before leaving the judgment, it may be observed that under the Act or the Rules neither the lessee nor his servants/workers/agents have any authority to detain a consignment which in their opinion is chargeable to Exit Tax but is not being paid. It is only the Taxation Officer or the Taxing Inspector or the Clerk as mentioned in the Rules who was the authority. It is further clarified that use of force or the threat to use the force by the contractor or its agents to force recovery on consignments not liable to goods tax is a criminal act and in appropriate cases such action must be initiated.
13. A copy of the judgment should be sent to Chief Secretary, Punjab, and the Secretary Local Government and Rural Development Department, for circulating necessary instructions in the light of this judgment.
14. These petitions .Are allowed tin the above terms. Since new and difficult question of law is involved, the parties are left to bear their own costs. revisions by the competent authorities. Therefore, it is advisable to consult the official sources or legal professionals for the most up-to-date and accurate information.