' MUNIR A. SHEIKH, J.----The petitioners seek leave to appeal against the judgment, dated 29-2- 2000 of the Lahore High Court through which Constitutional petition filed by the respondents against the imposition of licence fee of Rs,50,000 per annum on the trade of manufacture of shoes has been declared to be without lawful authority and of no legal effect.
2. The facts of the case are that the respondents admittedly have installed a factory of shoe- making within the local limits of petitioners-Zila Council. The petitioners-Zila Council prescribed a licence fee for carrying out the business and trade of manufacturing of shoe at Rs,50,000 per annum the legality of which was challenged by the respondents-manufacturers through Constitutional petition before the Lahore High Court on the ground that Zila Council was not vested with the powers to impose such a licence fee/tax under the Punjab Local Government Ordinance, 1979. Reliance in support of this objection was laid on section 73 read with 1st Schedule of the Local Government Ordinance. The learned Judge in Chamber of the High Court upheld the said objection and held that under the said Schedule, the petitioners-Zila Council could levy tax/licence fee only on those trades etc. Mentioned in the said Schedule which does not include the trade in question and there was no other law or provision in the Ordinance authorizing the Zila Council to levy tax or prescribe licence fee for any other trade, therefore, the levy of licence fee impugned in the Constitutional petition was without lawful authority and of no legal effect. The writ petition was accepted through the impugned judgment dated 29-2-2000 against which leave to appeal has been sought.
3. Learned counsel for the petitioners submitted that section 73 of the Local Government Ordinance relates to the powers of the Urban Council and not the Rural Council and Zila Council was a Rural Council and not Urban Council, therefore, reliance on the said provision of the Local Government Ordinance, was wholly misconceived. He referred to section 137 of the Local Government Ordinance, 1979 which empowers the Local Council which also includes a Zila Council to levy taxes on the trades mentioned in the Schedule-II. The second part of this Schedule relates to the power of the Zila Council to levy taxes Item No,12 of which reads as as under:-- "12. Tax on professions, trades, calling and employment."
He submitted that the Zila Council was fully competent under this item of the said Schedule to levy the taxes and prescribe the licence fee for any trade, as such, the findings of the learned Judge in Chamber that there was no other provision in the Local Government Ordinance authorizing Zila Council to impose such a tax was not legally correct which has altogether been ignored while passing the judgment.
4. The contentions raised by the learned counsel for the petitioners require examination, therefore, leave is granted to consider the same.
5. Till the disposal of the appeal, the operation of the impugned judgment of the High Court, dated 29-2-2000 shall remain suspended.
6. Learned counsel for the petitioners undertakes that in case, it is held by this Court that Zila Council was not vested with the authority/powers to recover the impugned licence fee as tax, it would refund the amount recovered from the respondents.