' RANA BHAGWAN DAS, J.---The petitioners a limited company and engaged in the production of parts and accessories for automobiles, through this petition have called in question the action of respondent No,1, K.M.C. As well was respondent No,3 acting as controlling authority in withholding refund of octroi to the petitioners as illegal and without lawful authority. There is another prayer for declaring the action of respondent No,1 in withholding enlistment of the petitioners for grant of Transit Pass Facility as without lawful authority and of no legal effect.
2. Petitioners through their letter dated 15-1-1986 applied to the respondent K.M.C. For their enlistment in respect of the goods to be imported for their manufacturing plant situated in Mouza Pathra, Tehsil Hub (Balochistan) seeking exemption from levy of octroi on such goods within octroi limits. Petitioner's request for their enlistment was pending consideration when in April, 1986 they imported seven consignments of machinery and accessories for their manufacturing unit and after satisfying the requirements of Rule 35 of West Pakistan Municipal Committees Octroi Rules, 1964 (hereinafter referred as the Octroi Rules) requested the octroi staff to clear the goods for transportation to Lasbella District which was not granted. Finding no way out in order to minimize their losses and to avoid payment of demurrage on such consignments at the port of Karachi, petitioners through letter dated 26-4-1986 offered to pay the octroi amounting to Rs,2,57,748 under protest expressly stating that the octroi would be refunded on production of payment receipts at Hub, Lasbella. Later, on production of such receipts they requested for refund of the octroi which was declined and the petitioner was advised to prefer an appeal before the Mayor of Karachi Metropolitan Corporation. Since Karachi Metropolitan Corporation was dissolved in the meanwhile petitioners' appeal was heard and dismissed by the Administrator vide order dated 4-4-1987.
Petitioners impugned this order before the Appellate Tribunal Local Councils, Sindh i,e, respondent No,2 who by order dated 28-6-1987 allowed the appeal with directions to respondent No,1 to refund the amount of octroi with interest at 10% from the date of payment to the date of refund. Since the order passed by the Appellate Tribunal was not implemented by respondent No,1 petitioners moved the respondent No, 3 for enforcement of such order who by his letter dated 26-24989 rejected the request of the petitioners. Hence this petition on the grounds inter alia that the petitioners goods were not meant for consumption, use or sale within the octroi limits of Karachi.
3. The petition was admitted to consider the ground that since the goods were directly taken from the port to Hub and that the octroi was paid under protest, the required declaration in fact was given and, therefore, respondents were not justified in withholding refund of the amount.
4. In the counter-affidavit filed on behalf of K.M.C. Material facts narrated hereinabove were not disputed. It was, however, averred that the petitioners were not entitled to exemption from payment of octroi within the meaning of Rules 136 and 137 read with Appendix 'B' and 'C' of the Octroi Rules. It is their case that the request of the petitioner for grant of transit pass facility remained pending for want of certain documents which the petitioners did not furnish, and thus, there was delay. With regard to the order passed by Appellate Tribunal Local Councils it is urged that the said Tribunal had no jurisdiction to hear appeals against the order of the Mayor, K.M.C. As under the provision of Rule 216 read with Item 3 of Appendix 'G' of Octroi Rules such appeals can only be filed before the Additional Chief Secretary, Housing Town Planning, Local Government, and Rural Development Department, Government of Sindh. Respondent has demonstrated its attitude of rigidity and unreasonableness by pleading that there is no provisions in the Octroi Rules for refund of Octroi paid under protest.
5. At the hearing, learned counsel for the petitioners referred to the letters addressed to the Director K.M.C. Karachi requesting for exemption from payment of Octroi at Karachi as the goods were being imported for installation at Hub and not meant for consumption, use or sale within the octroi limits of K.M.C. Which fact indeed is not disputed. The case set up by the respondent K.M.C. Is that the request for enlistment of the petitioners for temporary retention of goods at Karachi could not be finalized before the actual import of the goods for the reason that they had asked for certain documents which were not supplied. We are least impressed by this contention raised on behalf of the respondent K.M.C. No such letter or communication is placed on record to justify the withholding of reasonable request of the petitioners for enlistment for the purposes of exemption from payment of octroi. Inordinate and unreasonable amount of delay in finalizing the request of the petitioners without any justifiable cause can hardly be accepted as a ground for .Withholding such concession which otherwise was due and liable to be granted. In the face of a categorical statement of the petitioners that the goods were imported for the purpose of immediate transportation to Hub in Balochistan and such goods were not brought within octroi limits of K.M.C.
For consumption, use or sale by itself is sufficient to hold that such goods could not be subjected to levy of octroi within the meaning of section 60 relating to the power of Local Councils for levy of taxes. Indeed the expression 'octroi' has been defined in Rule 2(m) as under:-- "Rule 2(m). 'Octroi' means a tax on the import of goods for consumption, use, or sale within the octroi limits;"
Reference to Rules 136 and 137 read with Appendix 'B' and 'C' of the octroi Rules relating to Articles which shall be exempted from the payment of octroi and in respect of which an exemption may be claimed is completely misconceived for the basic object/purpose of the Octroi Rules permits the respondents to levy octroi on goods imported within its octroi limits for consumption, use or sale and not otherwise. Indeed the case of the petitioners is governed by Rule 35 of the Octroi Rules which reads as under:-- "Rule 35. When goods liable to Octroi are presented at an Octroi Post, the person incharge of the goods shall declare whether the goods are intended for--
(a) consumption, use or sale within the Octroi limits;
(b) consumption, use or sale within the Octroi limits for a purpose for which an exemption is to be claimed;
(c) consumption, use or sale within the Octroi limits by a party with which Octroi has been compounded, or from which Octroi is to be charged through a bill;
(d) consumption, use or sale within the Octroi limits when the goods are imported under a re- import pass;
(e) immediate export;
(f) temporary retention within the Octroi limits and ultimate export.
6. Since the petitioners consistently pleaded with the respondent K.M.C. That the goods imported by them were neither meant for consumption nor use or sale within the octroi limits of K.M.C. The latter cannot be permitted to agitate otherwise. We are supported in this view by letter Exh.'C' to the memo. Of petition addressed by the petitioners to the Director, Octroi K.M.C. Requesting for temporary pass facility for their consignment and to allow the payment of octroi under protest which should be refunded on production of receipts of octroi payment at octroi post Hub, District Lasbella. It is pertinent to note that on this letter the respondent K.M.C. Promptly allowed the payment of octroi by the petitioners and recovered the amount without any hesitation. This act on the part of the respondent K.M.C. Manifests indiscreet exercise of executive power with the least regard for the sanctity of law and the rules made thereunder. Merely because the Petitioners had chosen to offer the payment of octroi under protest for the reason that they would have otherwise incurred heavy demurrage charges cannot by any stretch of reasoning justify the illegal act of the respondents.
7. It is amazing to note that after the rejection of request for refund of the octroi amount they preferred an appeal before the Appellate Tribunal, Local Councils Sindh presided over by a Judicial Officer who rightly directed the refund of octroi amount recovered illegally and paid under protest but the respondent K.M.C. Was adamant by ignoring a just order on the plea that it was passed without any lawful jurisdiction.
8.. Appellate Tribunal Local Councils was constituted in terms of Rule 3 of Sindh Councils (Appeal)
Rules, 1982, with authority to hear appeals arising out of the orders passed under the Ordinance and the Rules made thereunder. Indeed in exercise of powers under Sindh Local Government Ordinance, Sindh Councils (Appeal) Rules, 1982 were promulgated. In the light of such Rules certainly Appellate Tribunal was justified in hearing an appeal from the order passed by the Administrator K.M.C. In fact the respondent K.M.C. Had submitted to the jurisdiction of the Appellate Tribunal knowing fully well that it had the jurisdiction to determine the issue raised before him. We are, however, not unmindful of the well-known maxim that jurisdiction cannot be conferred on an authority by consent of the parties.
9. Rule 4 of the Sindh Councils (Appeal) Rules, 1982 expressly lays down that appeal from an order of Mayor or Chairman shall lie to the Appellate Tribunal except in cases expressed otherwise in the Sindh Local Government Ordinance or any rules or Bye-laws framed thereunder. We are of the view that the Appellate Tribunal rightly exercised jurisdiction in the matter of hearing an appeal from the order passed by the Administrator K.M.C. Declining the refund of the amount of octroi deposited by the petitioners under protest. Reliance on Rule 216 read with Appendix 'G' to the Octroi Rules by the respondent K.M.C. In our view is completely ill advised and highly misconceived. This Rule relates to an appeal against the assessm ents made and orders issued under these Rules as specified in Appendix 'G' to the Rules providing the forums to hear appeal from any assessment made under the Octroi Rules. It may however, be observed that petitioners in this case were not agitating the order of assessm ent on the goods but essentially claiming refund of the amount for the reason that the goods were exempted from payment of octroi as these were imported for immediate export. Assuming for the sake of argument that the Administrator K.M.C. Was competent to hear the appeal made by the petitioners yet another appeal before the Appellate Tribunal is neither expressly barred under the provisions of the Ordinance nor the Rules made thereunder. On the contrary Rule 4 of the Rules referred to hereinabove clearly tends to show that an appeal from an order passed by the Mayor/Chairman shall lie to the Appellate Tribunal unless provided otherwise.
Indeed no, provision to the contrary has been shown to exist to take the, case out of the jurisdiction of the Appellate Tribunal. One may wonder to conceive of a situation whether respondent K.M.C.
Knowing fully well of the legal position and having contested the appeal before the. Appellate Tribunal on facts should be allowed to agitate at this stage that the Appellate Tribunal had no jurisdiction to hear the appeal. It is equally difficult to reconcile with the position taken by the respondent that on the one hand they had submitted to the jurisdiction of the Appellate Tribunal and on the other hand they ignored to comply with the lawful direction made by the learned Tribunal.
10. Adverting to the position in law, it may be pertinent to refer to the view taken by the Lahore High Court in Municipal Committee, Multan v. Burmah Shell Storage and Distributing Co. PLD 1976 Lahore
726. Paras. 7 and 8 of the report are relevant and of some assistance for the view taken in this petition. These read as under.: "7.' Admission by representative of the company acknowledging; the liability before the Chairman, Municipal Committee, Lyallpur, would not stand in his way, for the imposition of duty was not in accordance with law, upon the well-known principle of expressum facit cessare taciturn. (If doing of a particular thing is made lawful, doing of something in conflict of that will be unlawful). Reliance is placed on E.A. Evans v. Muhammad Ashraf PLD 1964 SC 536.
8. The last objection has equally no force, for, if the amount demanded to be recovered has been illegally imposed by an authority not competent to levy the same the realisation of the amount cannot be given effect to, for, if the basic order is wrong the superstructure raised thereon falls to the ground. Yousaf Ali v. Muhammad Aslam Zia and others PLD 1958 SC (Pak.) 104, refers."
11. Similar view was expressed by a Division Bench of this Court in Firdous Spinning and Weaving Mills Ltd. v. K.M.C. 1987 MLD 240 laying down that goods in transit could not be kept in warehouse established by Municipal Committee for more than 60 days. It was ruled by the Bench consisting of Abdul Qadeer Chaudhry and Munawar Ali Khan, JJ. (as they then were) that breach of the Rules, would not entail levy of octroi on such goods, but at the most penal rent could be charged for excess period in accordance with scale fixed by Municipal Committee in that respect. Identical view was expressed by another Division Bench of this Court in Muhammad Amin Muhammad Bashir Ltd. v. Administrator of Karachi Metropolitan Corporation 1993 MLD 849 defining the scope of Rule 35(e) of Octroi Rules as under:-- "R.35(e). Goods not meant for consumption and use within octroi limits.--Such goods whether liable to octroi--Where goods in question, were not meant for consumption and use within the octroi limits but were directly exported to Iran under custom bonded facilities, such goods could not be subjected to octroi--Authority was not empowered to refuse a transit pass under rule 35(e), West Pakistan Municipal Committees (Octroi) Rules, 1964 in circumstances."
12. In view of the aforementioned discussion and a detailed analysis of the case law, we are of the considered view that the act of the respondent K.M.C. In withholding enlistment of the petitioners for grant of transit pass facility is without lawful authority and of no legal effect. Consequently the view taken by respondent K.M.C. As well as respondent No,3 in exercise of supervisory jurisdiction cannot be maintained. Accordingly this petition is allowed with costs and it is declared that the collection of octroi on the goods of the petitioners amounting to Rs,2,57,748 was completely without jurisdiction and in contravention of the Octroi Rules. Respondent K.M.C. Is directed to refund this amount to the petitioners alongwith 10% interest from the date of credit till payment within 30 days.
Aforesaid are the detailed reasons for the short order announced at the conclusion of the hearing on 10-12-1998.