1. Plaintiff has filed this suit for declaration, permanent injunction and recovery of a sum of Rs,71,33,100. Plaintiff is a limited company incorporated under the Companies Ordinance, 1984, having its registered office at Plot No,NWZ/l/P-1, Port Qasim Authority, Karachi. That the plaintiff has set up an industrial undertaking for manufacture of Toyota range of vehicles in the Industrial Estate of Port Qasim Authority at Plot No,NWZ/1/P-1, Port Qasim Authority, Karachi, the area is presently situated within the jurisdiction of the District Council, Karachi. That the plaintiff as a manufacturer for the sale of Toyota vehicles and promotion of trade and commerce throughout Pakistan has set up an Exclusive Dealership Network throughout the country and the intending purchasers of Provinces of Punjab, N.-W.F.P., Balochistan and Azad Kashmir are supplied vehicles through these authorised dealers. That according to Article 151 of the Constitution of the Islamic Republic of Pakistan, 1973, which ensures freedom of Trade and Commerce and intercourse throughout Pakistan and that defendant have no lawful authority to impose restrictions in the exercise of trade and commerce and intercourse throughout Pakistan by the plaintiff. That defendant No,3 claims to have acquired rights for collection of export tax purportedly levied by defendants 1 and 2 in the purported exercise of powers under section 60 of the Sindh Local Government Ordinance, 1979.
2. That defendant No,1 through Notification No,DCK/TAX/95, dated 16-10-1995 revised the rates of items of export tax of District Council, Karachi and thereby increased the existing rates of export tax on chassis and other assembled vehicles of all kinds. That even the revision of the export tax was made inconsistent with the provisions of the relevant laws. That the defendant No,3 despite the serious objections raised by the plaintiff refused to allow export of Toyota Corolla vehicles in the absence of payment of alleged Export Tax at the rate of Rs,750 per vehicle. The plaintiff during the period commencing from 27-10-1995 to 31-12-1996 has exported 6,554 Toyota Corolla vehicles towards dealers in other Provinces of Pakistan and the defendant No,3 during this period has illegally recovered a sum of Rs,49,15,500 from the plaintiff allegedly on the ground of unlawful demand of export tax from the plaintiff at the rate of Rs,750 per vehicle. The vehicles were exported by the plaintiffs to various parts of Pakistan situated in other Provinces. Likewise plaintiff during the period commencing from 1-1-1996 to 31-12-1996 has exported 1,848 Toyota Hi-Lux Pick-Ups through authorised dealers in other Provinces of Pakistan. The defendant No,3 despite serious objections of the plaintiff refused to allow the export of the said vehicles in the absence of payment of alleged export tax at the rate of 1200 per vehicle and has recovered a sum of Rs,22,17,600, the vehicles were exported by the plaintiff to various cities of Pakistan situated in other Provinces.
3. After institution of the Suit C.M.A. 1863 of 1997 under Order 39, Rules 1 and 2, C.P.C. was filed by the plaintiff with a prayer to temporarily restrain the defendants or any person acting through or under them to demand or recover the export tax in respect of Toyota Corolla and Toyota HI Lux Pick Ups being exported by the plaintiff to other Provinces of Pakistan. In support of the application affidavit of Saeed Jung Principal Officer of the company has been filed. Notice of this application was issued to the defendants for 1-4-1997 defendants Nos.l and 2 were served but notice issued to defendant No,3 was returned unserved. Defendants were called absent, since counter-affidavit to this C.M.A. was not filed, under the circumstances ad interim injunction was granted till 24-4-1997 and now counter-affidavit has been filed by Abdul Aziz Baloch the partner of the defendant No,3.
4. Mr. Syed Sharifuddin Pirzada, learned counsel for defendant No,3 has contended that under the Sindh Local Government Ordinance, 1979 under entry 6 of Part II of Schedule V is in respect of the charges/levy of export tax/tool/ Rawangi Mahsool on goods produced/manufactured within and going out of the territorial limits of the District Council (taxable limits) is, thus, charged and collected on goods going out of the territorial limits/jurisdiction of District Council. According to the decisions of learned D.B. of this Court reported in 1990 M LD 317 and PLD 1990 Kar. 402 that the goods that were not only going out of a District Council's statutory limits while ultimately to other Provinces and that such goods could not be made subject of the local tax as the same would be violation of freedom of inter-Provincial trade guaranteed under Article 151 of the Constitution of Pakistan. The learned D.B. directed the proof of goods having been actually taken to other Provinces for which purpose the observations continuing in para. 9 (page 322) points to the imperative necessity for the Government of Sindh to issue necessary directive or to frame due rules with a view to give effect to the conclusion reached in these petitions. Unless this is done, there would be no end to acrimony and Court directed that copies of the orders in these petitions shall be forwarded to the Secretaries of the Government of Sindh in the law, Local Government and Rural Development Departments for needful to be done at the very earliest. That pursuant to the above- referred directions 1990 M LD 317 at p.322 (para.9) the defendant No,1 issued the requisite directive (SOV-DC-VII(94)/96 to the following effect:-- "That the exporter from the District Council was to show that at the tool post he paid the export tax (and produced evidence/receipt of the said payment).thereafter if the goods were sold to/in other Provinces, the sufficient acceptable proof must be adduced in the said behalf for claiming immunity under Article 151 of the Constitution and; On the basis of the aforesaid submissions/proofs application for refund be made and if the case is made out, refund shall be allowed."
5. That the plaintiff did not declare itself as the exporter or that the vehicles were being sold outside the Sindh Province. That in the absence of the compliance of the requirement under the observations of this Court referred hereinabove or the Provincial directive there is no basis for filing of the suit. That claim by plaintiff is by a person who did not export or paid the export tax. The plaintiff is an alien to the situation. That even according to the plaint it is averred that plaintiff is the exporter of Toyota vehicles or such vehicles were sold in any other Province or contains declaration nor is it a fact that the export tax/tool/Rawangi Mahsool was charged from or paid by the plaintiff.
6. That plaintiff has no locus standi in the matter and that claim in suit has no nexus or entitlement with the plaintiff. That without prejudice-to the above the vehicles if exported out of the territorial limits of the Rawangi Mahsool (the taxable territory) the refund of export tax, could be claimed back as refund through other procedure laid down otherwise than by the present suit. That there is adequate remedy for refund. That the real persons who paid export tax, and if established relevant facts, can claim the refund in view of the two decisions of 1990 referred hereinabove. That no prima facie case has been made out by the plaintiff, balance of convenience also does not favour the plaintiff. That realisation of the tax was lawful. That serious and irreparable harm and injury shall afflict the defendant No,3 Mr. Akhtar Ali Mahmood has referred; (1) Muhammad Matin v. Mrs. Dino Manekeji Chinoy and others PLD 1983 Kar. 387. The decision of learned D.B. of this Court consisting of by their Lordships Abdul Hayee Kureshi and Munawar Ali Khan (Acting Chief Justice and Judge as they then were), the rule, laid down by their Lordships is that for the grant of an injunction at an interlocutory stage of the suit, the plaintiff only needs to show that he has a prima facie case, that the balance of convenience between the parties as well as for avoidance of complications would lie in favour of the party seeking the injunction, and lastly that the plaintiff would suffer irreparable harm by refusal of an injunction.
2. Messrs Bisvil Spinners Ltd. v. Superintendent, Central Excise and Land Customs Circles, Sheikhupura and another PLD 1988 SC 370. Their Lordships dealing with the Sales Tax and interpretation of statute citing the case Corporation of Madras v. Madras Electric Tramways Ltd. AIR 1931 Mad. 152, reproduced the dictum which is as follows:-- "If the special Act is made after the general Act, the position is even simpler. Having made the general Act if the Legislature afterwards makes a special Act in conflict with it, we must assume that the Legislature had in mind its own general Act when it made the special Act and made the special Act, which is in conflict with the general Act, as an exception to the general Act.
7. The special provision made in SRO-580(1)/83 would be an exception to the earlier general provision made in SRO-666(1)/81 and, therefore, will hold away and the earlier S.R.O. will yield."
8. In my humble opinion this case-law is not relevant to the case in hand. Admittedly the tax involved in the matter is being charged by the defendant No,3 which is .sanctioned by defendant No,1 under Sindh Local Government Ordinance, 1979 and subsequently, in pursuance to the observations of the case reported in 1990 M LD 317, the observations are already referred hereinabove in the earlier part of the order and the Government of Sindh issued Notification bearing SOV-DC-VII(94)/96, dated 19th September, 1996 the relevant portion is as follows:-- "In view of the above and in the interest of the Councils, till such time any proper rule is framed, the exporters shall deposit the amount of export tax with the Chief Executive of the Council and on production of proof that the goods have been exported outside the territorial limits of Sindh to any other area of Pakistan, the amount of export tax so deposited with the Chief Executive shall be refunded to the exporters."
9. The defendant No,3 is charging tax being contractors who has taken the contract from defendant No,2 which was duly approved by defendant No,1, tax so levied and charged in any case is not In violation of the Article 151 of the Constitution. Under the circumstances this authority in my humble opinion is not applicable to the matter in hand.
3. Sayphire Textile Mills Ltd. and others v. Government of Sindh and others PLD 1990 Kar. 402. The learned D.B. consisting of his Lordships Saleem Akhtar Judge (as he then was) and my learned brother Wajihuddin Ahmed, J. has held that:-- "Here, too, though not on the arguments of the petitioners, we have to record favourable findings, by holding that an export tax, of the kind questioned in these proceedings, on inter-Provincial movement of goods cannot be levied or enforced, being in contravention of Article 151 of the Constitution of Pakistan."
10. As referred hereinabove the export tax/tool/Rawangi Mahsool is not being charged on inter- Provincial movement of goods if any charge has been made. The mechanism for refund of the same has been provided by the Government in their notification referred hereinabove, therefore, the tax so charged or collected by the contractor in my humble opinion is duly sanctioned lawfully and is not in violation of the Article 151 of the Constitution, therefore, this authority in my humble opinion is not favourable to the case of the plaintiff.
4. Mc Carthy and Stone (Developments) Ltd. v. London Borough of Richmond Upon Thames 1994 SCM R 1393 wherein it has been held that Local Government cannot charge for a service unless it is required by statute to provide such service and is also authorised by law to charge for such service. The tax which is being charged by the Contractor is duly sanctioned by the defendant No,1 under the provisions of Sindh Local Government Ordinance and the subsequent Notification issued by the Government of Sindh Local Government, dated 19-9-1996 referred hereinabove also provide mechanism for the refund, if due. With due respect to the authority I am of the firm opinion that this authority is not relevant to the facts of the present case.
11. I have gone through the material placed with the case and I have also minutely perused the case- law referred and discussed hereinabove. Admittedly defendant No,3, the contractor is charging the tax which is duly sanctioned under the provisions of Sindh Local Government Ordinance, subsequently, the Government of Sindh in pursuance to the observations made in the case reported in 1990 M LD 317 and PLD 1990 Kar. 402 the tax on the inter-Provincial movement of goods is not being charged but Rawangi Mahsool/tool tax is being charged for the vehicles which are to be used in the Province of Sindh only. The plaintiff himself is not exporter and he himself does not pay the export tax whereas persons who took away the vehicles outside the jurisdiction of District Council have to pay the tax and after proper proof that the vehicle so taken out of jurisdiction of District Council was actually taken away to the up-country viz. Punjab, Balochistan, N.-W.F.P. and Azad Kashmir, after proper and authentic proof regarding the vehicle that the same is used in the above Provinces the Concerned persons can get the refund of the amount if so paid.
12. Mr. Syed Sharifuddin Pirzada learned counsel for defendant No,3 stated at the Bar that if any proof is furnished in pursuance to the Notification issued by the Government of Sindh, Local Government referred hereinabove the concerned party will definitely get the refund as provided in the Notification. The basic principles for the grant of injunction are prima facie balance of convenience, arguable case and irreparable loss and injury if any to be suffered by the party as well as for avoidance of complications that would lay in favour of the party seeking injunction. In my humble opinion prima facie neither balance of convenience is in favour of the plaintiff nor there arguable case on their behalf. Moreover, they are not likely to suffer an irreparable loss or injury. Furthermore, in order to avoid further complications application is liable to be dismissed which must fail and order dated 1-4-1997 is hereby recalled.
13. After hearing the parties by short order I have rejected the application on 24-4-1997 and these are the reasons for the same.