SABIHUDDIN AHMED, J. -- All these petitioners are based on similar facts and raise identical questions of law. As such are being disposed of by this common judgment.
2. The facts in C.P. No. D-1552 of 1987 as stated in the memo, of petition appear to be that the petitioner wished to import certain machinery, i.e. 15 Suttlers looms for their Textile mills under the BMR Scheme. They submitted an application dated 24.5.1987 to the then Controller of Exports and Imports for grant of import licence to the extent of Rs.10 millions and deposited an amount of Rs.200,000/- in the treasury by way of prescribed import licence fee at the rate of 2% of the value of goods proposed to be imported. Subsequently, they realised that their entitlement to import under the BMR Scheme was only to the extent of Rs.9,546,000/- and by a letter dated 3.6.1987 requested that the value of the licence be reduced accordingly and that they would utilise the balance licence fee for subsequent import licence. However, by a Notification dated 13th June, 1987, the Licences and Permit Fee Order, 1979 was amended, so as to increase the licence fee from 2% to 4% of the value of goods. By a letter dated 16.6.1987 from the Assistant Controller, Imports and Exports the petitioner were required to pay licence fee at the enhanced rate. Since the petitioner required the machinery urgently they made payment of additional amount of Rs. 181,840/- under protest and subsequently demanded refund of the amount of Rs. 190,290/- being the additional 2% fee imposed vide the Notification dated 13.6.1987. Their application for refund however, came to be rejected vide letter dated 29.9.1987.
3. In all the remaining petitions the facts are more or less similar to the extent that applications for import licence for different goods of different value were made by the respective petitioners prior to 13.6.1987 and import licence fee at the rate of 2% was deposited. Such applications appear to be under process at one stage or another when the aforesaid Notification was issued and thereafter the concerned authorities demanded payment of enhanced fee before issuing the requisite import licence. The petitioners paid the amount demanded under protest but subsequently claim refund of the same and the request for refund came to be rejected on different dates.
We have had the benefit of hearing able arguments from M/s. Muhammad Ali Sayeed, H.A.
Rehmani, Rashid Akhund on behalf of the petitioners and M/s. Muhammad Akram Zubari and Hisam-ud-Din on behalf of the respondents that doubling the import licence fee, from 2% to 4% vide impugned Notification dated 13.6.1997 was itself unconscionable and liable to be declared ultra vires the powers of the Federal Government, It was further urged that in any event the enhanced fee could not be applied to applications for licences submitted prior to the date of the Notification as this would amount to give it retrospective effect. On the other hand it was urged on behalf of the respondent that no vested right had arisen in favour of the petitioners by merely submitting application for import licence and they were liable to pay fee at the rate prevailing on the date when such licences were duly granted.
4. Before considering in detail the respective arguments of the leaned counsel however, it may be appropriate to mention that licences are issued by the Federal Government regulating import of goods into Pakistan under Section 3(1) of the Imports and Exports (Control) Act, 1950, which reads as under:- "3. Powers to prohibit or restrict imports and exports. - (1) The Federal Government may, by order published in the official Gazette and subject to such conditions and exceptions as may be made by or under the order, prohibit, restrict or otherwise control the import or export of goods of any description, or regulate generally all practices (including trade practices) and procedure connected with the import or export of such goods, and such order may provide for applications for licences under this Act, the evidence to be attached to such applications, the grant, use, transfer, sale or cancellation of such licences, and the form and manner in which and the periods within which appeals and applications for review or revision may be preferred and disposed of, and the charging of fees in respect of any such matter as may be provided in such orders."
The relevant provisions of the Licences and Permit Fee Order, 1979, prior to the impugned notification read as follows:- "3. (1) Every person in whose favour an import licence, import permit or clearance permit is granted or who applies for opening of a letter of credit for the import of any goods for which a specific import licence, import permit or clearance permit is not required, shall pay fee at the rate of 2% ad valorem on the face value of each import licence, import permit, clearance permit or letter of credit, as the case may be: -------
(2) A receipted treasury challan showing payment of fee on the face value of a licence shall be submitted alongwith the application for grant of licence; --------
5. Mr. Muhammad Ali Sayeed, learned counsel for the petitioner in C.P. No. 392 of 1989 in the first place argued that amendment of the figures 2% to 4% occurring in para 2(1) of the Order quoted- above, through the impugned Notification dated 13.6.1987 was itself invalid. He contended that in the first instance such an amendment has not been brought about by the legislature itself but only by the executive purporting to exercise powers delegated by the legislature. He argued that power delegated by the legislature must be subject to reasonable limits and the power to double the licence fee without any justification would itself amount to excessive or impermissible exercise of delegated power. Alternatively, he contended that executive power as distinguished from legislative power must be exercised reasonably, rationally and no rationale having been offered for doubling the licence fee abruptly, the Notification in question was liable to be struck down as such.
Elaborating his contention, argued that the import licence fee was not a tax for general revenue purposes and a fee by its very connotation implies that it is levied for services rendered. Therefore, doubling the amount of fee without showing any substantial increase in the value of services alleged to be rendered was itself unlawful.
6. With all deference to the learned counsel we are entirely unable to subscribe to the arguments premised on the concept of excessive delegation of legislative power. The amplitude of the scope of delegation of legislative power in our Constitutional through system Is authoritatively settled by the Honourable Supreme Court in the cases of Zaibtan Industrial Mills v. Central Board of Revenue (PLD 1983 S.C. 358) and Shaikh Abdul Rahim Allah Ditta v. Federation of Pakistan and others (PLD 1988 S.C. 670) and we are unable to see how the power to determine the quantum of fee for grant of licence in terms of Section 3(1) of the Import and Export (Control) Act can be held to be impermissible delegation of legislative power.
7. Mr. Muhammad Ali Sayeed and Mr. Rashid A. Akhund, however, appear to be right in contending that all discretion vested in public functionaries must be exercised reasonably, fairly and in the public interest for the purpose for which it was conferred. Recent trend of judicial authority and the insertion of Section 24-A in the General Clauses Act, shows that the vesting of discretion in public functionaries imposed a duty to act reasonably and the expression "unfettered discretion" has no meaning in public law. When the statute has conferred the power to impose licence fee on the Government without providing any guide-lines such power ought to be exercised within reasonable limits and its arbitrary exercise can always be struck down by Courts. The observations of the Honourable Supreme Court in the cases of Federation of Pakistan and others v. Chaudhry Muhammad Aslam and others (1986 S.C.M.R. 916) and Independent Newspaper Corporation v.
Chairman Fourth Wage Board (1993 S.C.M.R. 1533), cited by Mr. Sayeed fully support the contention of the learned counsel.
8. To determine whether the impost in question was reasonable or otherwise however, it would be necessary to examine the nature of the levy, the measure of increase and all relevant circumstances. We are not impressed by Mr. Sayeed's contention that the mere fact of the fee being raised by 100% would itself be sufficient for being struck down as unreasonable. For instance if a licence fee or a toll is being charged for rendition of certain services at the rate of Rs.5/- it cannot be struck down for being raised to Rs.10/-. Learned counsel however, emphatically argued that the levy in question being only a fee for the purpose of rendition of services and not a tax for general revenue purposes an element of quid pro quo must be available. He contended that to justify the increase it was incumbent upon the respondents to show that the costs of services had - multiplied to such an. Extent that over night doubling of the quantum of fee had become necessary. Indeed in Ayaz Textile Mills v. Federation of Pakistan (PLD 1993 Lah. 194) it was observed that when reasonableness of a levy in the shape of fee is challenged, it was for the authorities to justify the charge. With profound respects however, we are unable to subscribe to the proposition so broadly stated, In our humble opinion, (assuming the levy in question be a fee for rendition of services) if the petitioner desired to question the levy as unreasonable it was incumbent upon him to at least present some data to show prima facie that no nexus between the costs of services and the quantum of fee collected existed. We are fortified in this view by the following observations of the Honourable Supreme Court in Noon Sugar Mills v. Market Committee (PLD 1989 S.C. 449): "As regards the contention that the fee levied should be commensurate with the quantum of services provided none of the appellants has cared to place any data before us which might indicate that the market committees were charging fee at a rate much beyond their legitimate requirements or out of proportion to the services rendered by them in their respective areas. We have, therefore, no hesitation in repelling the contention of the learned counsel."
9. Moreover, it would not be quite correct to describe the import licence fee as a levy for rendition of services relating to processing of application for import licence etc. It needs to be kept in view that under Section 3(1) of the Import and Export (Control) Act, 1950, the Federal Government has the power to ban or restrict the import of certain goods in the country. The mere requirement of obtaining a licence shows that import of the goods has been restricted under the regulatory power of the Government which has also been authorised to levy a fee in beneficiaries of the grant of a licence, It may more appropriately be described as a charge upon those on whom the privilege of using the country's limited foreign exchange reserves is conferred, In this context it may be pertinent to reproduce the following observations of Nazir Akhtar, J. In Ayaz Textile Mills v.
Federation of Pakistan (PLD 1993 Lahore 194):- "As mentioned above, the quantum of fee and the value of the privilege and services rendered cannot be computed or measured with arithmetical accuracy and the scale may tilt on either side, It is more so in case of licence for import or export of goods which is part of a regulatory system and is a category apart from the ordinary cases of market fee, fee for radio, television or arms licence, or for admission to a club or use of a bus stand in which the principle of quid pro quo is applied essentially with reference to the services rendered by the authorities/public functionaries to justify the levy. The import licence fee is a composite charge for the privilege conferred as well as the services rendered in the field of import of goods. However, the levy of fee for grant of import or export licence should. Be reasonable and not excessive or exorbitant."
10. In view of the above we agree that a levy of this kind could be struck down if it was shown to be palpably unreasonable, unconscionable or confiscatory in nature. Nevertheless keeping in view relevant circumstances, particularly the fact that the additional liability does not exceed 2% of the value of the imported goods, a privilege to import goods is conferred upon the licensee which is not available to other citizens and the burden is casted upon the more affluent section of the people, we find it difficult, in the absence of any material to establish otherwise, to hold the same to be ex facie unreasonable. We are also aware of the well-settled principle that in fiscal matters Courts are slow to interfere with imposts levied by competent authorities unless there is sufficient material on record justifying such action. We are, therefore, unable to hold the increase in fee to be unreasonable.
11. Mr. H. A. Rehmani, learned counsel for the petitioners in most of the petitions argued that by submitting an application alongwith payment of the prescribed fee at the rate applicable at the relevant time, the petitioner had acquired a right to be granted the import licence in question and such right could not be impaired or affected by the impugned Notification. He relied, inter alia, on the judgment of the Honourable Supreme Court in Al-Samrez Enterprises v. Federation of Pakistan (1986 S.C.M.R. 1917) and Molasses Trading & Exports (Pvt.) Ltd. v. Federation of Pakistan and others (1993 S.C.M.R. 1905). Indeed the judgments fully support Mr. Rehmani to the extent that in case a right to be granted the licence had become vested in the petitioner the impugned Notification would have no bearing upon the same.
12. The assumption that the petitioner being otherwise eligible for grant of licence had acquired a vested right to be granted the same upon having made an application accompanied by deposit of the prescribed fee, however, does not appear to be correct in view of the pronouncements of the Honourable Supreme Court relied upon by Mr. Muhammad Akram Zubari learned counsel for the respondents, In Government of Pakistan V. Zamir Ahmed Khan (PLD 1975 SC 667), the respondents had applied for the grant of import of cinematograph films on 04.08.1972 the import policy thereafter, was however, amended and such films could only be imported through an agency to be specified by the Ministry of Information. Consequently licensing authority declined to authenticate respondent's application for the licence and upon such action being challenged before the High Court the Letters Patent of the Court directed the licencing authority to issue such licence in accordance with law. Upon an appeal preferred by the Federal Government the Honourable Supreme Court held that it was wrong to suggest that the respondents had acquired any legal right for the grant of licence by merely applying for the same and depositing the necessary fee and there was no substance in the arguments that the amendment in the Import Policy Order on 10.08.1972 could not impinge upon the respondent's entitlement on the basis of his earlier application dated 04.08.1972. Learned counsel for the respondents also relied upon the judgment of the Honourable Supreme Court in Zamir Ahmed Khan v. Federation of Pakistan (1978 SCMR 327) where another Bench of the Court decided an application for review of the afore-mentioned judgment. Review was inter alia sought on the ground that the Court had omitted to notice certain observations in an earlier judgment in Pakistan and others v. S. Hussain AH Shah Fazlani (PLD 1960 SC 310). In this case under the relevant import policy import licences for films were to be granted to those who had exported Pakistani films to India. The petitioner having exported such a film applied for an import licence which was granted on 12.9.1957, but cancelled without notice on 25.11.1957.
Holding such cancellation to be unlawful, the Court observed:- "The licence granted was not mere act of discretion or unilateral act on the part of the Government, It was granted in fulfilment of an undertaking, which imposed certain prior conditions upon the applicant, which conditions he had fulfilled, and thereby there had accrued in his favour, something in the nature of a legal right to an import licence of equivalent value."
13. Discussing the effect of the above observations the Honourable Supreme Court pointed out that the two cases were distinguishable in as much as in Fazlani's case an import licence had already been issued upon fulfilment of certain conditions whereas in Zamir Ahmed's case no licence had been granted at all and reiterated that making of an application alone did not create a vested legal rights in favour of the applicant, In view of the above authoritative pronouncements it is not possible for us to hold that any vested right to licence had enured for the benefit of the petitioners which could not be affected by the amendment in the policy.
14. For the fore-going reasons we are unable to uphold any of the contentions raised on behalf of the petitioners and would therefore, dismiss these petitions with no order as to costs. We are grateful to the learned counsel for the parties for the valuable assistance rendered.