1. This writ petition is addressed under section 44 of Azad Jammu and Kashmir Interim Constitution Act, 1974.
2. The succinct facts forming the background of the instant writ petition are that on 5-5-1997, on the application of Ch. Talib Hussain and others, non-petitioner No.1, gave an assurance and commitment to them, that if they will install a Flour Mills in Sehala Humak, Rawalpindi, then, the Food Department of Azad Jammu and Kashmir shall supply 1000 tons wheat monthly for grinding purposes. Subsequently, on 16-1-1998, another assurance was given that instead of 1000 tons, 1875 tons wheat shall be provided to the Mills for grinding. Later on, the petitioner could not install the Mills at Sehala Humak and the petitioner moved an application that the installation of Mills at Sehala Humak is not feasible, therefore, he wants to install the Mills at 17-Miles Kalyam More, near Rawat, Rawalpindi. He also wants to change the name of the Mills as United Kashmir Flour Mills Limited instead of Kashmir United Mills Limited, therefore, the quota may be allocated in the name of United Kashmir Flour Mills, 17-Miles Kalyam More, near Rawat, Rawalpindi, upon which, the quota was allocated in the name of proposed United Kashmir Flour Mills, Rawat. On this assurance and commitment of the Government, the petitioner took necessary steps for the establishment of the Flour Mills. He established a Flour Mills at 17-Miles Kalyam More, near Rawat, after spending millions of rupees. Now, all of a sudden, through notification dated 17-9-2002, the notification dated 10-7- 1998 has been canceled, whereby the quota of wheat of 1875 tens monthly was fixed for the proposed Mills. This notification has been challenged through the instant writ petition.
3. This writ petition was admitted for regular hearing. Notices were issued to the non-petitioners who have filed their respective written statements. Arguments have been heard.
4. Haji Muhammad Afzal, the learned counsel for the petitioner argued that when once a commitment and assurance was given by the non-petitioners to the petitioner that 1875 tons of wheat shall be supplied to the proposed Mills and on the assurance and commitment of the non- petitioners, he spent millions of rupees and established a Flour Mills at 17-Miles Kalyam More, Rawat, then the non-petitioner No. 1 was not competent to rescind or withdraw from the commitment. He further submitted that although initially the sanction was obtained for the Mills at Sehala Humak because the petitioner wants to establish the Mills at Sehala Humak but when it was not found feasible then, the petitioner sold the plot at Sehala and obtained another plot at Kalyam More, near Rawat with the consent of non-petitioner No. 1. He moved an application in this respect to the non---petitioners which was allowed by him, thus, the petitioner established the Mills at Kalyam More near Rawat with the consent of the non-petitioners and before the establishment of the Mills, the non-petitioner also gave a commitment and assurance through Government notification dated 10-7-1998 that 1875 tons monthly wheat shall be supplied to the proposed Mills at Kalyam More, near Rawat. He submitted that when this assurance was given by the non- petitioners, at that time, the Mills was not established but the Mills was-established after the assurance of the non---petitioners, as it has clearly been mentioned in the notification dated 10-7- 1998. It was next maintained by the learned counsel that after the aforesaid commitment and assurance, the non-petitioner was estopped from the cancellation of the aforesaid Notification on the basis of the doctrine of promissory estoppel. He submitted that only on the assurance and commitment of the non---petitioners, the petitioner established the Mills after spending a huge amount, therefore, the non-petitioners have been estopped from deviating and resiling from their assurance and commitment. It was submitted by the learned counsel that the principle of promissory estoppel has also been affirmed by the Supreme Court of Azad Jammu and Kashmir in the case 1998 PTD 3200 relevant page 3205. He further referred PTCL 1993 CL 219 (sic) and 220 in support of his contentions.
5. It was next maintained by the learned counsel for the petitioner that no opportunity of hearing was provided to the petitioner as it is evident from the notification dated 17-9-2002. He has been condemned unheard. He submitted that it is most unfortunate, that on the commitment and assurance of the non---petitioners. The petitioner spent huge amount and established a Mills but now, the non---petitioners have tesiled from their commitment and assurance without providing an opportunity of hearing to the petitioner, while it was incoumbent upon them to pass any notification after hearing the petitioner. It was next maintained by the learned counsel that the Notification dated 17-9-2002 also did not contain any reason. It simply contained that the Notification dated 10-7-1998 was violative of the Rules of Business but it did not contain that which provision on the Rules of Business was violated, therefore, this notification is not sustainable and it is mala fide. He submitted that no violation of any Rules of Business was committed.
6. While controverting the arguments of the learned counsel for the petitioner, Raja Bashir Ahmad Khan, the learned counsel for the non-petitioners contended that no assurance and commitment was given to the petitioner. According to him, the assurance and commitment was given to the Kashmir United Flour Mill, which was being installed by Ch. Talib Hussain and Mst. Zabida Rashid and it was to be established at Sehala Humak. Subsequently, the quota of this Mills was transferred to the present petitioner which was illegal, and no assurance was given to the Mills which was established at Kalyam near Rawat, thus, no question arises about the promissory estoppel It was next maintained by the learned counsel for the non-petitioners that the notification dated 10-7- 1997 was not passed according to the Rules of Business, but he could not point out that how and which provision of Rules of Business was violated, upon which the learned counsel for the petitioner was confronted whether the impugned notification passed by the non---petitioners was passed according to the Rules of Business? He submitted that although it was also not passed according to the Rules of Business, but the basic notification in favour of the petitioner was illegal and he wants to protect the ill-gotten gains through the writ petition which is not permissible. It was next submitted by the learned counsel that although the notification dated 17-12-2002 did not contain that an opportunity of hearing was provided to the petitioner but the Prime Minister directed the Secretary that an opportunity of hearing may be provided to the petitioner. It was next maintained by the learned counsel that the writ petition has been filed by Muhammad Saeed Chaudhry who has been shown as Chief Executive of the Mills, while there is nothing on the record on the basis of which it could be said that he was the Chief Executive of the Mills. In this respect, he referred Annexure P.13, Certificate of Incorporation and submitted that it nowhere contained the name of Muhammad Saeed Chaudhry as Chief Executive and he was not authorised to file the present writ petition, thus this writ petition entails dismissal on this ground.
7. I have heard the learned counsel for the parties, perused the relevant record and have given my utmost muse to the respective arguments advanced by the learned counsel for the parties.
8. The doctrine of promissory estoppel for the first time, was introduced in case "Hughes v.
9. Metropolitan Rly. Co. (1877) AC 439 and Birmingham and District Land Co. v. London and North- Western Rly. & Co. (1888) 40 Ch. D. 268 decided about a century ago by the House of Lords. This doctrine was re-inforced in 1947 by the most imminent respected Judge Mr. Justice Denning, who enjoyed remarkable respect in the legal fraternity of Europe. In his judgment in. The case "Central London Property Trust Ltd. v. High Trees House Ltd. (1956) 1 All. ER 1956. He pressed into service the doctrine of promissory estoppel against the landlord and held that the tenant was liable to pay the reduced rent at 1250 per year in place of 2500 per year on the basis of terms made by the landlord for certain years. The aforesaid view was reiterated by the learned Judge Mr. Justice Denning in the case of Robertson v. The Minister of Pensions" reported in (1949) 1 KB 227 in which the appellant, a serving Army Officer, wrote to the War officer regarding his disability and received a reply accepting the above disability as attributable to the military service. Relying upon the above assurance, he did not obtain an independent medical report. Later on, the Minister of the Pensions declined the appellant's claim. Denning Judge, while hearing the appeal held as follows:-- "Held that as between subjects such as assurance would be enforceable because it was intended to be binding, intended to be acted upon, and was in fact acted upon, (ii) that the assurance was binding on the Crown because no term could be implied that the Crown was at liberty to revoke it, and (i.e) that the assurance was, therefore, binding on the Minister of Pensions, the appellant having become entitled to assume that the War Office had consulted any other department concerned before it gave the assurance."
10. This doctrine is also known as "Equitable estoppel", (ii) Quasi-estoppel, and (i.e) New estoppel. It is based on equity. This principle was followed in U.S.A. And India on various occasions. Now it has also been recognized in Pakistan. The Supreme Court of Pakistan followed this principle in various pronouncements.
11. It would also not be out of place to mention here that in case of "Falmouth Boat Construction Ltd. v.
12. Howell (1950) 1 All ER 538, Justice Denning the learned Judge, while expressing his opinion, pressed into service the doctrine of promissory estoppel and observed as follows:-- "The principle is this: Whenever Government officers, in their dealings with a subject, take on themselves to assume authority in a matter with which the subject is concerned, he is entitled to rely on their having the authority which they assume. He does not know and cannot be expected to know, the limits of their authority and he ought not to suffer if they exceed it. That was the principle which I applied in Robertson v. Minister of Pensions and it is applicable in the present case also. It was not canvassed in Jackson Stansfield. v. Butterworth (1948) 2 All ER 558 and that case is, therefore, no obstacle to its adoption. In my judgment, therefore, the plaintiffs were guilty of no illegality, and their claim is not be defeated on that account. The appeal should be allowed. "
13. I would also like to refer some cases from the Indian jurisdiction. In case of Union of India and others v. Messrs Anglo Afghan Agencies reported in AIR 1968 SC 718, the Textile Commissioner published a scheme called as Export Promotion Scheme on 10-10-1962 by which an incentive was given to the exporters of woollen goods. The exporters were invited to register themselves to the Textile Commissioner for exporting the woollen goods and it was represented that the exporters would be entitled to import raw materials of the total amount equal to 100 percent. Of the F.O.B.
14. Value of the exports.
15. However, clause 10 of the scheme entitled the Commissioner to reduce the value of the import certificate if it was found that fraudulent attempt was made to secure an import certificate in excess of the true value of the goods exported. The respondents who exported woollen goods of Rs.5,03,471,73 applied to the Textile Commissioner for the issuance of import entitlement certificate but instead of issuing for the full amount certificate for Rs.1,99,459 was issued. Thereupon, the respondents filed a Constitutional petition before the High Court of Punjab for directing the Textile Commissioner, Chief Controller of Imports and Exports; Bombay to issue a licence permitting import of wool tops, raw wool, wool waste and rags of the value of Rs.3,04,012.73 which was allowed.
16. Against the above judgment of the High Court, the Union of India filed an appeal in the Supreme Court of India which was dismissed and while dismissing the appeal, the following observations were made:-- "We hold that the claim of the respondents is appropriately founded upon the equity which arises in their favour as a result of the representation made on behalf of the Union of India in the Export Promotion Scheme, and the action taken by the respondents acting upon that representation under the belief that the Government would carry out the representation made by it. On the facts proved in this case, no ground has been suggested before the Court for exempting the Government from the equity arising out of the acts done by the exporters to their prejudice relying upon the representation. This principle has been recognised by the Courts in India and by the Judicial Committee of the Privy Council in several cases. In Municipal Corporation of the City of Bombay v. Secretary of State (1940) ILR 29 Bom. 580 it was held by the Bombay High Court that even though there is no formal contract as required by the Statute, the Government may be bound by a representation made by it..."
17. This case is in our judgment, a clear authority that even though, the case does not fall within the terms of section 115 of the Evidence Act, it is still open to a party who has acted on a representation made by the Government to claim that the Government shall be bound to carry out the promise made by it, even though the promise is not recorded in the form of a formal contract as required by the Constitution."
18. 1986 SCMR 1917, the Government of Pakistan had issued a Notification on 8-6-1972 in exercise of the powers conferred by section 19 of the Customs Act, 1969 exempting certain items of the machinery or articles for use with the machinery or as, component part or spare parts of the machinery as defined in the said notification. The appellant acting upon the above notification, opened an irrevocable letter of credit. However, when the machinery arrived at Karachi Port and before the goods were cleared, the above notification granting exemption was rescinded. The appellant's efforts to get the redress from the High Court proved fruitless. Thereupon, an appeal with the leave of the Court was filed in the Supreme Court and the Supreme Court has held as under:-- "The principle of law enunciated above has been recognized in corpus juris of this country and also statutorily in section 6 of the General Clauses Act. For instances of the application of this rule of interpretation reference may be made to In re: March Madder v. Harris (1884) 27 Ch. D. 166 and Jones v. Ogle (1872) LR 8 Ch. A 192. We are, therefore, clearly of the opinion that if a binding contract was concluded between the appellants and the foreign exporter or steps were taken by the appellants creating a vested right to the then existing notification granting exemption, the same could not be taken away and destroyed in modification of the earlier one, on the ground that under section 21 of the General Clauses Act, the Government could exercise the power of modification. "
19. The crux of the aforesaid case-law is that, where one party has, by his word or conduct, made to the other party a clear promise which is intended to create a legal relation or effect a legal relationship to arise in future knowing or intending that it would be acted upon by the other party to whom the promise is made and it is, in fact, so acted upon by the other party; that promise would be binding on the party making it and he is not entitled to resile from it. Thus, if, in the instant case, the assurance and commitment was given by the non-petitioners they were not entitled to resile or deviate from it on the basis of doctrine of promissory estoppel.
20. Now, the question which perturbs my mind is whether the assurance was given by the non- petitioners in the instant case. Although, the learned counsel for the non---petitioners contended that no assurance was given to the petitioner, but it was given to the Kashmir United Flour Mills whose directors were Ch. Talib Hussain, Muhammad Aziz Khan and Mst. Zabida Rashid and which was to be installed at Sehala Humak but it has no substance for the reasons that first, the petitioner moved an application for the installation of the Mills at Humak Sehala but subsequently, when, he could install it at Sehala as it was not feasible then, he moved an application that instead of Sehala, he wants to set up the said Mills, at 17 Miles-Kalyam More, near Rawat and he also craved for the deletion of the name of Sardar Muhammad Aziz Khan and Mst. Zabida Rashid from the Kashmir United Flour Mills and this application was allowed. Subsequently, on 10-7-1998, the notification was issued which reads as under:-- According to the aforesaid notification, an assurance was given to the United Kashmir Flour Mills owned by Ch. Talib Hussain, which was to be set up at Kalyam near Rawat. It is also pertinent to note that when this assurance was given, at that time, the Mills was not installed or set up because the aforesaid notification contained the words, "Majawaza" United Kashmir Flour Mills which means that it was a proposal but on this assurance of the non---petitioners, the Mills was installed and set up at Kalyam More. Subsequently, the non---petitioners started the delivery of 1875 tons wheat monthly to the said Mills according to the notification but after the lapse of four years, now, on 17- 12-2002, the non---petitioners have cancelled the said notification, which was already acted upon by the non-petitioners, therefore, it could not be said that this notification was for the Mills which was to be installed at Sehala Humak. It would also not be out of place to mention here that an application of Sardar Muhammad Aziz Khan has been placed on the record as Annexure "RA", according to which it was craved by him that the quota of his Mills situated at Sehala Humak should not be transferred to any other Mills.
21. Now, the question emerges whether the quota of Sardar Muhammad Aziz Khan was transferred to the petitioner's Mills. There is nothing on the record on the basis of which it could be said that the quota of the Mills of Sardar Muhammad Aziz Khan was transferred to the present Mills, but there is also a photostat copy of the writ petition on record, which was filed by Sardar Muhammad Aziz Khan against Ch. Talib Hussain and others but subsequently, this writ petition was also withdrawn on the ground that his quota was not transferred to any other Mills, therefore, it could not be said that the quota of the Mills of Sardar Mohammed Aziz Khan was transferred to the petitioner's Mill. It is clear from the notification, dated 10-7-1998 that a commitment and assurance was given to the petitioner that 1875 tons wheat shall be provided to the Mills owned by Ch. Talib Hussain proposed at Kalyam More near Rawat, thus, the contention raised by the learned counsel for the non -- petitioners that no assurance was given to the Mills of the petitioner is without any substance.
22. Another question arises that if no assurance was given to the petitioner, then, why the notification, dated 10-7-1998 was cancelled because if no assurance would have been given to the petitioner, then, there was no need for the cancellation of this notification. It clearly transpires that the assurance was given to the petitioner through the aforesaid notification which was subsequently cancelled.
23. It is also pertinent to note that at the time of cancellation of notification, dated 10-7-1998, no opportunity of hearing was provided to the petitioner. The notification, dated 19-9-2002, whereby the aforesaid notification was cancelled, did not contain that an opportunity of hearing was provided to petitioner. Although, the learned counsel for the non-petitioners submitted that the Prime Minister directed the Secretary to provide an opportunity of hearing to the petitioner, but it does not mean that an opportunity of hearing was provided to him. There is nothing on the record, on the basis of which it could be said that any opportunity of hearing was provided to the petitioner. It is to be noted that, if the non---petitioners would have provided an opportunity of hearing to the petitioner, then they would have placed on record the proof of it. The requirement of opportunity of hearing is that, a notice should be served to the concerned party, in respect of the proposed action against him and he should be asked to show cause, that why not the proposed action may be taken against him.
24. This view finds support from 2002. CLD 8238 (852), which reads as under:-- "The requirements of an opportunity of hearing means that the person must be issued a letter/notice informing him of the action proposed to be taken against him and asking him to explain why it, should not be done so. After service of such notice, it is necessary that an opportunity be provided to the person to whom the show-cause notice has been issued to appear in person and explain his position verbally or in writing."
25. It is to be noted that, in the instant case, an assurance was given to the petitioner and on the assurance of non-petitioners, he invested a huge amount and set up a Mills but now, the notification regarding the assurance and commitment has been cancelled without providing any opportunity of hearing to him. He has been condemned unheard. Even no show-cause notice was given to him while under law, it was obligatory upon the non-petitioners to issue a show-cause notice to the petitioner containing the allegation on the basis of which, the non-petitioners want to cancel the said notification, but when on such show cause was given to the petitioner, then the notification issued by the non-petitioner No. 1 is not sustainable. This view finds support from 2002 CLD 1714 (1725), which reads as under:-- "It is also not disputed in the present case that the Company has not been served with a show- cause notice mentioning all the allegations on the basis of which the order of appointment of the Inspector was passed."
26. As the next contention of the learned counsel for the non-petitioners is concerned, that Muhammad Saeed Chaudhry was not the Chief Executive of the Company and he was not competent to invoke the extra jurisdiction of this Court, it has no substance, for the reason that: "under section 205 of the Companies Ordinance, 1984, every company keeps a register at its registered office, containing the details of its Directors, Officers, including Chief Executive, Managing Agent, Secretary, Chief Accountant, Auditors and Legal Advisor etc. And after every year, the Company has to inform about any change made in its register". In the instant case, the copy of Form No.29 is on the file as Annexure P.9, which contained the details of Director, Officers, including Chief Executive and Managing Agent etc. As provided in section 205 of the Companies Ordinance, 1984. P.9 clearly contained that Muhammad Saeed Chaudhry is the Chief Executive of the company, therefore, the contention raised by the learned counsel for the non-petitioners, that he was not a Chief Executive, is without any substance.
27. As the other contention of the learned counsel for the non-petitioners is concerned that Muhammad Saeed Chaudhry was not authorised to file the present writ petition, it has also no substance, because the Board of Directors, through a resolution, has authorised Muhammad Saeed Chaudhry for filing the writ petition. The resolution of the Board of Directors is also on file.
28. The nub of the above discussion is that this writ petition is accepted and the impugned Notification No.FS/H-6(19)/49---1742/2002, dated 17-9-2002 is hereby set aside and declared to be without lawful authority and the non-petitioners are directed to restore the monthly quota of wheat of 1875 tons to the petitioner according to notification, dated 10-7-1998. Keeping in view, the peculiar circumstances of the case, no order as to costs.