MAMOON KAZI, J.- Brief facts of the case are that, in 1994 the Government of Pakistan initiated "Awami Tractor Scheme", which allowed import of tractors into the country without levy of customs duty and other charges. In furtherance of the said Scheme, vide SRO 921 (1)/94, dated 22.9.1994, the Federal Government exempted tractors and their parts from whole of customs duty and sales tax if imported by the importer authorised by the Ministry of Food, Agriculture and Livestock. Further, on 11.12.1994, vide SRO 1189(1)/94 CKD components of tractors were exempted from whole of customs duty and sales tax if imported by local manufactures.
2. On 13.6.1996 SRO 921 (1)/94 and SRO 1189(1)/94 were amended by SRO 388(1)/96 and SRO 414(1)/96 respectively and customs duty upto 10 per cent was levied and further exemption of the whole sales tax was withdrawn. However, it was decided by the Federal Government that import of tractors under the Awami Tractor Scheme shall not be governed by the said decision.
3. In pursuance of the said scheme, the respondent, which had an assembly plant of Belarus medal tractors in the country, offered to import the aforesaid tractors. The respondent was issued letter of authorisation, dated 26.6.1996, by the said Ministry, permitting it to import 11000 Belarus tractors and expressly providing that, all concessions provided under the first phase of the said scheme would be available to the importer. The respondent was however bound down to sell the tractors at Rs. 2,30,000/- per unit and to open a letter of credit before 30.6.1996.
4. It may be pointed out that in the meanwhile when the Caretaker Government was in power in Pakistan, the Federal Government decided to revise the whole tractor scheme and the matter was referred to the Economic Coordination Committee of the Cabinet which approved the proposal to terminate the scheme. However, when the matter was still pending with the government, the respondent filed writ petition before the Lahore High Court seeking injunction to restrain the petitioners from withdrawing or modifying the said scheme.
5. On 24.2.1997 when the matter came up for hearing before a learned Single Judge of the High Court, the Deputy Attorney General for Pakistan made a statement before the Court indicating that a decision had already been taken by the Government to discontinue the said scheme whereupon the petition was disposed of as infructuous.
6. The said order was, however, assailed by the respondent in an Intra-Court Appeal before a Division Bench of the same Court which accepted the appeal, holding that the respondent's rights were protected under section 6 of the Protection of Economic Reforms (Act XII of 1992), which had overriding effect over other laws. The case of the respondent was also held to be governed by the principle of promissory estoppel which, according to the learned Judges, bound the Federal Government to honour the letter of authorization, dated 26.6.1996, which had extended. Benefit of the same concessions as were earlier applicable under the said scheme. The contention raised on behalf of the petitioners that section 31-A of the Customs Act empowered the Federal Government to withdraw exemptions or concessions granted under the said Act was also repelled. On the other- hand, doctrine of legitimate expectation was applied.
7. Leave was granted to examine the effect of the different notifications issued by the Federal Government, referred to earlier in this judgment.
8. We have heard Ch. Muhammad Farooq, learned Attorney General for Pakistan on behalf of the Federal Government and Mr. S. Sharifuddin Pirzada on behalf of the respondent.
9. The learned Attorney General has argued that, vide the said notifications, dated 13.6.1996, the respondent was liable to pay customs duty and sales tax. On the imported tractors at the rate of 10 per cent and 18 per cent respectively. The learned Judges in the High Court were therefore, clearly in error while allowing the appeal on the strength of the said letter of authorization; dated 26.6.1996, which having been issued by the Ministry of Food, Agriculture and Livestock, against the provisions of section 31A of the Customs Act, could not authorise waiver of any levy legally imposed on the said goods. It has been further argued that; after insertion of section 31-A in the Customs Act, the doctrine of promissory estoppel could not be invoked by the respondent, as it was liable to pay customs duty and other charges at the rate obtaining at the time of import of the tractors in terms of sections 30 and 31 of the said Act, notwithstanding the earlier concessions granted in pursuance of the said scheme.
10. Challenging the aforesaid contentions, Mr. Sharifuddin Pirzada has, on the other hand, argued that, vide authorization letter, dated 26.6.1996, the respondent was allowed similar concessions as had been allowed under the first phase of Awami Tractor Scheme, therefore, the tractors imported by the respondent under the said scheme enjoyed complete exemption from payment of customs duty and sales tax, vide SRO 921 (1)/94 and SRO 1189(1)/96, respectively, which continued to remain in force after the said letter of authorization. It has been further contended that, having induced the respondent to place order with foreign suppliers for import of the said tractors, the Federal Government could not be permitted to repudiate its own undertaking to the detriment of the respondent. Support for the said contentions has been sought to be obtained by Mr. Sharifuddin Pirzada from the equitable doctrine of estoppel which is embodied in Article 114 of Qanun-e- Shahadat Order, 1984.
11. Reference in this regard has been made by the learned counsel first to the observations made by this Court in Mukhtar Ahmad v. Government of West Pakistan (PLD 1971 SC 846). In this case, the Government of West Pakistan has launched a scheme for training of Assistant Agricultural Engineers whereunder candidates were first to be selected for appointment. Candidates selected by the Public Service Commission although, satisfied all the conditions but when they were about to complete their training, they were informed by the government that they would have to appear again before the said Commission for their final selection. The candidates asserted that after completion of their training the condition subsequently imposed by the Government was unjustified. This Court in this case observed:- "The offer of the government and its acceptance by the appellants constituted a valid agreement and the Governor's: order dated, the 1st July, 1965 provided the authority for such an agreement.
This agreement is capable of being enforced in law. The Government was both competent and obliged to implement that agreement."
Reliance has also been placed by Mr. Pirzada on the case of Robertson v. Minister of Pensions (1948) 2'A11 E.R. 766. In this case, decided by the King's Bench Division, the claimant was injured in an accident while on military service. After he had been examined by a medical hoard and tbund unfit for general service, he wrote to the War Office which, without consulting the Minister of Pensions, replied to the claimant that his disability had been accepted as attributable to military service. On the faith of such assurance, the claimant took no further steps to obtain independent medical opinion. The question, therefore, arose, whether the assurance contained in the letter of the War Office was binding on the Minister of Pensions. It was held that the letter from the War Office was on the face of it an authoritative decision intended to be binding and to be acted on the fact that the claimant had, as a result of that letter, forborne from getting a medical opinion was sufficient to have made the letter bending. Reliance has further been placed by Mr. Sharifuddin Pirzada on the case of M/s. Motilal Padampat Sugar Mills Co. Ltd. ,Vs. The State of Uttar Pradesh (AIR 1979 SC 621).
In this case the Supreme Court of India while examining the scope of the doctrine of estoppel embodied in section 115 of the Indian Evidence Act, which is identical in terms with Article 114 of our own Qanun-e-Shahadat, observed that:- "It is only if the Court is satisfied, on proper and adequate material placed by the Government, that overriding public interest requires that the Government should not be heid bound by the promise but should be free to act unfettered by it, that the Court would refuse to enforce the promise against the Government."
12. It may be pointed out that the principle of estoppel invoked by Mr. Sharifuddin Pirzada, which is now referred to by the Courts as the doctrine of promissory estoppel, has been examined by this Court in a number of judgments and it has been held in these cases that although, the said doctrine is available in this country against the government or its functionaries, but it has been further held that the said doctrine is not available against the Legislature. Although, no executive action can operate retrospectively so as to impair vested rights or impose new obligations but the same principle cannot apply in case of a legislative provision. The learned Attorney General has referred to a number of cases wherein effect of section 31-A of the Customs Act has been examined by this Court and it has been held that, even if a contact has been entered into by a party upon exemption granted under section 19 of the Customs Act, no vested right would be created so as to deprive the competent authority from rescinding such exemption as section 31-A now clearly stipulates that any amount of duty which becomes payable in consequence of withdrawal of a concession concession or exemption from duty, even though such withdrawal takes place after conclusion of a contract for sale of goods or opening of a letter of credit, would now he payable in terms of section 30 of the Customs Act. The said section provides that, the rate and amount of duty applicable to any imported goods shall be the rate and amount chargeable on the date of the presentation of the bill of entry. The rule of promissory estoppel earlier laid down by this Court in the case of Al-Samrez Enterprise v. Federation of Pakistan (1986 SCMR 1917) putting an embargo on the power of the go 'e, Iment to withdraw an exemption after a contract had already been entered into by a party or letter of credit had been opened by it, has been further held to be no longer applicable. Section 31-A of the Customs Act is tem corporated here for convenience of reference as under:- "31-A. Effective rate of duty.--Notwithstanding anything contained in any other law for the time being in force or any decision of any Court, for the purposes of sections 30 and 31, the rate of duty applicable to any goods shall include any amount of duty imposed under section 18, section 2 of the Finance Ordinance, 1982 (XII of 1982), and section 5 of the Finance Act, 1985 (1 of 1985), and the antidumping or countervailing duty imposed under the Import of Goods (Antidumping and Countervailing Duties) Ordinance, 1983 (III of 1983), and the amount of duty that may have become payable in consequence of the withdrawal of the whole or any part of the exemption or concession from duty whether before or after the conclusion of contract or agreement for the sale of such goods or opening of letter of credit in respect thereof.
(2) For the purpose of determining the value of any imported or exported goods, the rate of exchange of which any foreign exchange is to be converted into Pakistan currency shall be rate of exchange in force,-
(a) in the case of goods referred to in clause of section 30, on the date referred to in that clauses;"
Cases referred to by the learned Attorney General in this regard are reported as Messrs Nizam Impex and another v. Government of Pakistan (1990 'SCMR 1187), Mian Nazir Sons Industries Ltd. V.
Government of Pakistan (1992 SCMR 883), Molasses Trading and Export Ltd. Vs. Federation of Pakistan (1993 SCMR 1905), M/s. Army Welfare Sugar Mills Limited v. Federation of Pakistan (1992 SCMR 1652), Messrs M. Y. Electronics Industries Ltd. V. Government of Pakistani (1998 SCMR 1404) and Collector of Customs v. Ravi Spinning Ltd. (1999 SCMR 412).
13. Consequently, when SRO 921 (1)/94 and SRO 1189(1)/94 which were applicable earlier, wee amended vide SRO 388 (1)/96 and SRO 414(1)/96, dated 13.6.1996, the earlier notifications ceased to be operative and customs duty and sales tax on the said tractors after the subsequent notifications came into force became payable in accordance with the rates applicable in terms of section 31A of the Customs Act. Although, the letter dated 26.6.1996, issued by the Ministry of Food, Agriculture and Livestock had authorised the respondent to avail benefit of exemption under the earlier notifications which were applicable during the first phase of the said scheme and on the faith of the said letter, the respondent claims to have entered into an agreement with the foreign supplier for import of the said tractors, but promissory estoppel cannot be invoked against provisions of any legislation even if they authorise the government to impose new obligations or to withdraw existing concessions. Consequently, the doctrine of promissory estoppel appears to have been erroneously invoked by the High Court to defeat the provisions of section 31-A of the Customs Act.
14. Mr. Sharifuddin Pirzada has further argued that the provisions of section 31-A of the Customs Act are liable to yield to the provisions of sections 6 and 10 of the Protection of Economic Reforms (Ad XII of 1992) as the provisions of the said Act have been given overriding effect over-those of the former. Reliance has been placed by him on Messrs. Ellahi Cotton Mills Ltd. V. Federation of Pakistan (PLD 1997 SC 582), M/s Zaha Ltd V. Agrcultural Development Bank of Pakistan (PLD 1993 Lah. 914) and an unreported judgment of this Court in Civil Appeal No. 223 of 1994 (Gudoon Industries Limited v. Government of Pakistan) decided on 16.12.1998. In these cases, no doubt, the provisions of Act XII of 1992, which is a special statute, have been held to prevail over those of the general statutes on account of their overriding character. The learned Attorney General has however argued that section 6 has been erroneously invoked by the learned Judges of the High Court as they have failed to take into consideration the purpose and object of "economic reforms" as defined by section 2 (1)(b) of Act XII of 1992. The said definition is as under:- "(h) "economic reforms" means economic policies and programmes , laws and regulations announced, and after the seventh day of November, 1990, relating to privatization of public sector enterprises, and nationalised banks, promotion of savings and investments, introduction of fiscal incentives for industrialization and deregulation of investment, banking, finance, exchange and payments systems, holding and transfer of currencies; and
(c) all other expressions used in this Ordinance shall have the meanings respectively assigned to them under the relevant laws.
15. Section 6 of Act XII of 1992 upon which Mr. Pirzada has relied provides for protection of fiscal incentives for setting up of industries. It lays down that:- "6. Protection of .Fiscal incentives for setting up of industries.--The fiscal incentives for investment provided by the Government through the statutory orders listed in the Schedule or otherwise notified shall continue in force for the term specified therein and shall not be altered to the disadvantage of the investors."
Section 10 which is the other section relied upon by the learned counsel, further provides:- "10. Protection of financial obligations.-- All financial obligations incurred including those under any instrument, or any financial and contractual commitment made by or on behalf of the Government shall continue to remain in force, and shall not he altered to the disadvantage of the beneficiaries.
16. Preamble of the said Act same into force was to provide legal protection to economic reforms introduced by the government and to create a liberal environment for savings and investments and other matters related thereto. As has been pointed out by the learned Attorney General, section 6 is intended only to provide protection to fiscal incentives for investment and industrialisation in the country. Therefore, it cannot he extended to matters, where such object is not intended to he achieved. The section also provides protection to Notifications No. SRO 1283(1)/90 and SRO 1284 (1)/90, both dated 13.12.1990, which have been referred to in the Schedule to the said Act. So far as section 10 is concerned, no doubt it provides that all financial obligations including those under any instrument incurred on behalf of the government shall continue to remain in force and shall not he altered to the disadvantage of the beneficiaries, but the provisions of sections 6 and 10 cannot be interpreted in isolation without taking into account the purpose and object of the statute. Therefore, as was pointed out earlier, the object behind Act XII of 1992 only appears to be to provide fiscal incentives for economic reforms as defined by section 2 of the Act and industrialisation in the country as part of the economic policies and programmes of the government. Therefore, no general protection appears to have been intended to be provided to any importer of finished industrial products by the said section. It is pertinent to point out that, in Collector of Customs v. Ravi Spinning Ltd. (1999 SCMR 412), the question as to power of the government to impose regulatory duty under section 18(2) of the Customs Act was examined by this Court in the light of section 6 of Act XII of 1992 and the contention that the government could not withdraw concessions or exemptions earlier allowed to the importer of goods in view of the provisions of section 6 was emphatically repelled by this Court. Consequently, in our view, reference to the provisions of Act XII of 1992 appears to be completely misplaced. Equally misconceived is invocation of the doctrine of legitimate expectation by the learned Judges of the High Court as the doctrine cannot be invoked to nullify effect of a legislative provision. The judgments relied upon by the learned Judges in this regard are also not applicable to the facts of the present case.
17. Lastly, Mr. Pirzada while relying upon Muhammad Baran v. Member (Settlement and Rehabilitation Board of Punjab) (PLD 1991 SC 691) and Muhammad Saleem Vs. Superintendent of Police, Sialkot (PLD 1992 SC 369) has argued that even if the order impugned in the case is found to he technically defective, but if it is otherwise justifiable, the order must be sustained. According to the learned counsel, heavy loss would be suffered by the respondent on account of breach of undertaking by the petitioners. Therefore, the judgment of the High Court can be sustained on moral grounds. The contention, however, equally appears to be unsustainable as the question involved in the present case relates to recovery of public revenue. If claim of the government to recover duty or tax is otherwise sustainable under the law, relief cannot be granted to a party at the cost of public revenue even if its claim to the same is founded on high moral grounds.
Therefore, the cases referred to by Mr. Pirzada are distinguishable as in none of them any question of recovery of duty or tax was involved.
18. In the result, there appears to be force in the contentions raised by the learned Attorney General.
Resultantly, the appeal is allowed and the judgment of the High Court is set aside. There will, however, be no order as to costs in view of the question raised by the parties.