1. ' Petitioner through this . Constitutional petition has taken exception to the notice dated 19-9-1998 calling upon him to pay an amount of Rs,1,36,37,000.
2. ' Facts briefly for the disposal of this Constitutional petition are that the petitioner took lease rights for the collection of goods exit tax of Zila Council, Rahimyar Khan for a consideration of Rs,5.27,00,000.
3. ' Learned counsel has argued that under rule 16 of the Punjab Zila Council Exit Tax Rules, 1990, the respondents are entitled to charge 2% security and the refund claim at the rate of 5% while in the impugned notice inflated amount has been claimed.
4. ' I have considered the contentions and have gone through the documents appended with this petition. I have already in my order dated 29-10-1998 passed in Writ Petition Nos.20669 of 1998 and 21323 of 1998 repelled these contentions. Section 39 of the Punjab Local Government Ordinance, 1979, provides as under:--
39. Contracts.---(1) All contracts made by or on behalf of a local council shall be--
(a) in writing and expressed to be made in the name of the local council;
(b) executed in such manner as may be prescribed; and
(c) reported to the local council by the Chairman at the meeting next following the execution of the contract.
5. ' In section 39(1)(b) the word "prescribed" has been used which according to section 3(xxix) means prescribed by Rules. Punjab Zila Councils (Goods Exit Tax) Rules, 1990 has been framed by the Government in the exercise of powers conferred under sections 144. 167 and 137 read with Item No,7 of the Part II of the Second Schedule of Punjab Local Government Ordinance, 1979. Sub-rules (1), (3),
(8) and (9) of rule 16 are relevant for the resolution of the issue involved in these Constitutional petitions which are as under:--
16. Lease of collection of Zila Council Goods Exit Tax.----(1) The Zila Council may lease out by public auction for a period not exceeding one year, the collection of Goods Exit Tax on such terms and conditions and in such manner as may be specified by the Government.
(3) The person whose bid is accepted at the auction shall forthwith deposit with the officer conducting the auction a sum equal to one percentum of the amount of the bid as security for the performance of his obligation in regard to the collection of Zila Council Goods Exit Tax and payment of lease money to the Zila Council.
(8) (i) In addition to the security deposit referred to in sub-rule (3) the person whose bid is confirmed by the Zila Council (hereinafter referred to as the lessee) shall within seven days of such confirmation deposit with the Zila Council fifteen per cent. Of the amount of his bid, and the balance of the amount of his bid shall be paid by him to the Zila Council in ten equal monthly instalments.
(ii) Each instalment shall be paid by the 15th day of the month for which it is due.
(9) The successful bidder shall furnish sureties of an amount equal to the total amount of the monthly installments to the satisfaction of the Chairman, Zila Council or in the form of a Bank Gurantee from a Scheduled Bank.
6. ' A reference is also made to Letter No,SOVI (LG) 2-5/97, dated 27-7-1998, issued by Government of the Punjab, Local Government and. Rural Development, whereby certain instructions were issued to regulate the collection of Goods Exit Tax. Instructions Nos.VIII and IX of para. 2 are relevant which are quoted below for facility of reference:--
(viii) It should also be specifically mentioned in the terms and conditions of auction and agreement deed that the amount equal to the average amount per year calculated on the basis of refund claims received in the Zila Councils during the years 1996/97 and 1997/98 shall be paid by the contractor in the advance before taking possession of the contract for settling the refund claims. If this amount falls short due to the amount refunded on account of refund claims, it shall be recouped by the contractor at the end of every month. It should also be mentioned in the terms and conditions of auction that the cover charge/illegal charged amount of Goods Exit Tax will refunded with 11 times penalty to the concerned person. In Addition to this section the contract shall also be cancelled on account of overcharging and illegal charging of Goods Exit Tax.
(ix) 5% of the bid should be obtained as security from the contractor of Goods Exit Tax before handing over the possession of the contract. This security should be refunded after 6 months of the expiry of the lease period.
7. ' The Government of the Punjab, Local Government through memo. Bearing No,SOVI(LG) 2-5/97, dated 31-8-1998, further made certain amendments in the afore-mentioned instructions to streamline of collection of Goods Exit Tax.
8. ' The reading of section 39(1)(b) of the Punjab Local Government Ordinance, 1979, makes it very clear that a contract would not be binding upon the Local Council unless and until it is strictly executed in accordance with the provisions of law and the rules framed thereunder. Punjab Zila Councils (Goods Exit Tax) Rules, 1990 also provides that the terms and conditions of the contract would not only be regulated by the rules but also such other terms And conditions as may be specified by the Government. The afore-stated instructions issued by Punjab Government provides 5% security to be deposited by Contractor before embarking upon the collection of Goods Exit Tax.
9. Similarly the local councils are also authorised to secure certain amount calculated on the basis of refund claims of the preceding year from the Contractor as revolving fund so as to settle the refund claims. The instructions/conditions in this regard have been laid down generally by the competent authority so as to streamline the grant of contract for collection of Goods Exit Tax. They are applied uniformally without any discrimination so as to protect both sides., i,e, Contractor as well as taxpayer. The petitioners being contractors are bound to abide by these instructions before embarking upon the collection of Goods Exit Tax. In these circumstances, the challenge of the learned counsel to the charge of 5% security as well as of revolving fund is not apt. Reference in this respect is made to Khan Faiz Ullah Khan v. Government of Pakistan through the Establishment Secretary, Cabinet Secretary and another (PLD 1974 SC 291) to fortify' that such-like instructions have got the force of statutory rules.
10. ' In view of what has been stated above, if the petitioner is aggrieved of the quantum of revolving fund he may if so feels approach the Chairman, Zila Council, who may demand on the basis of refund claim during the last two years. Resultantly for what has been stated above, no exception whatsoever can be taken to the charge of 5% security of the total consideration in the presence of afore-stated instructions. Writ petition is disposed of in the above terms.