MR. JUSTICE HAMID ALI MIRZA.-(l). Civil Appeal Nos. 512 of 1999 and 1686 of 1999 with leave of this Court and Civil Petition Nos. 1916-L of 1999 and 185-L, 198-L, 865-L, 951- L, 1060-L, 1061-L and 1064-L of 2000 are being disposed of by this common judgment as they involve common question of law and arise out of the judgments/orders of various dates impugned before us whereby the writ petitions filed by the private respondents were allowed.
2. Leave was granted by this Court in the two petitions giving rise to C. A. Nos. 1512 and 1686 of 1999 to examine the contentions raised by the leamed counsel for the appellants/petitioners (i) whether the question of fact with regard to fixation of the retail price and its determination for the purpose of recovery of taxes in the mater could have been determined in the constitutional jurisdiction; and
(ii) whether the respondents, without exhausting the statutory remedies under the Central Excises Act, 1944, could invoke the jurisdiction of the High Court for the relief under Article 199 of the Constitution.
3. The brief facts of the case are that the respondents are the manufacturers of beverages of different brands, which are chargeable with duty under section 4(2) of the Central Excises Act, 1944 at the retail price fixed by the manufacturers inclusive of all charges and taxes other than sales tax levied and collected under section 3 of the Sales Tax Act, 1990 which articles are to be sold to the general body of consumers provided the retail price of such goods has been legibly, prominently and indelibly printed or embossed on each article, packet, container, package, cover or label, as the case may be.
The appellants/petitioners as per Letter No. l(2)-CEB/94, dated 29.10.1994 stated that the chilling charges will not be included in the retail price of aerated water and same shall be excluded but after five years another letter was issued by the Central Board of Revenue whereby the earlier letter was withdrawn and directions were issued to all the Collectorates that chilling charges shall now be included while calculating retail price of the products. The respondents made representations against the said decision but their representations were rejected by the appellants/petitioner, consequently the respondents filed constitutional petitions under Article 199 of the Constitution of Islamic Republic of Pakistan wherein they claimed that the appellants/petitioner were not entitled under the law to direct the respondents to include chilling charges while fixing retail price. The writ petitions were heard and allowed by the High Court as per judgments/orders of different dates impugned in these appeals and petitions.
4.We have heard the learned counsel for the parties and perused the record.
5.The only contention raised and pressed before us by the learned counsel for the appellants/petitioner is that the respondents are supplying beverages of different brands in chilled condition therefore chilling charges are to be included in the retail price consequently impugned orders/notifications passed by the appellants/petitioner are legal and valid in terms of section 4(2) of the Central Excises Act, 1944. The learned counsel has referred to letters dated 27.9.1994, 9.10.1994, 13.4.1995 and 12.6.1999 issued by the appellants/petitioner from time to time in the said respect. At the end of his arguments, the leamed counsel for the appellants/petitioner conceded that at the factory gate the beverages are passed in un-chilled condition but refrigerators are supplied to the retail shopkeepers by the respondents for chilling aerated water.
6.The leamed counsel for the respondents have submitted that all the beverages which are manufactured/produced in the factories of the respondents are supplied in un-chilled condition therefore the respondents cannot be compelled to include chilling charges in the -detail price in terms of section 4(2) of the Central Excises Act, 1944. It was further submitted that as per letters dated 27.9.1994 and 9.10.1994 the chilling charges were excluded from the consumer price even of chilled bottles, but subsequently illegally as per impugned notification/order No. l(7)-CEB/99, dated 12.6.1999, the circular, notifications/orders were recalled/withdrawn and it was directed that the central excise duty shall be calculated and paid on the basis of retail price and no deduction whatsoever on account of chilling charges shall be made by any manufacturer of aerated waters and fruit juices. It was further submitted that the Board of Revenue, the final authority, had decided against the respondents, therefore, there was no justification to again approach the subordinate functionaries of the Central Board of Revenue for redress of the grievance. It is further submitted that no question of fact is involved and the only legal question with regard to section 4(2) of the Central Excises Act, 1944 required its true construction and scope whereunder the manufacturer has been given right to fix retail price of the goods/articles to be sold. Reliance is placed upon Atlas Battery Limited, Karachi Vs. Superintendent Central Excise and Land Customs Circle 'C' Karachi and others (PTCL 1984 CL. 250=PLD 1984 SC 86), Souvenir Tobacco Co. Ltd. Vs. Deputy Collector (PTCL 1989 CL. 522=1989 CLC 1134), Julian Hoshang Dinshaw Trust Vs. I. T. O. (PTCL 1992 CL. 181=1992 SCM R 250), Deputy Collector Vs. Premier Tobacco Industries Ltd. (1993 SCM R 447), Attock Cement Pakistan Ltd. Vs. Collector of Customs (PTCL 2001 CL. 509=1999 PTD 1892) and Edulji Dinshaw Limited Vs. Income Tax Officer (PTCL 1990 CL. 604=1990 PTD 155).
7.Sub-section (2) of Section 4 of the Central Excises Act, 1944 reads:- "(2) Notwithstanding the provisions of sub-section (1), the Federal Government may, by notification in the official Gazette, declare that in respect of any goods oi class of goods the duty shall be charged on the retail price fixed by the manufacturer, inclusive of all charges and taxes, other than sales tax levied and collected under section 3 of the Sales Tax Act, 1990, at which any particular brand or variety of such article should be sold to the general body of consumers or, if more than one such price is so fixed for the same brand or variety, the highest of such price: Provided that the retail price shall be legibly, prominently and indelibly printed or embossed on each article, packet, container, package, cover or label, as the case may be." The above provisions of the sub-section show that for the assessment of excise duty "retail price" has been basis/foundation which is to comprise of viz. (i) Duty shall be charged on the retail price, (ii) The retail price shall be fixed by the manufacturer, (iii) The retail price shall be inclusive of all charges incurred by the manufacturer and tax payable by him, (iv) The retail price shall not include the tax under Sales Tax Act, 1990, (v) The goods/articles shall be sold to general body of consumers at the fixed price, and (vi) In case more than one such price is so fixed for the same brand or variety, the highest of *such price. It is quite clear from the above provisions of law that retail price of the goods/articles chargeable with duty is to be fixed by the manufacturer which would include all the charges and taxes other than the sales tax levied and collected under section 3 of the Sales Tax Act, 1990. Admittedly, the retail price is to be fixed by the manufacturer but while fixing such price he has to include all charges and taxes incurred and payable by the manufacturer. It is only the charges incurred by the manufacturer/producer and tax payable by him which are to be taken into account while fixing retail price of the goods. It is the right of manufacturer to fix retail price of the goods/articles consequently he cannot be dictated to include the chilling charges when he has not incurred in the production of saleable goods/articles. It has been conceded by the leamed counsel for the appellants/petitioner that aerated water/juices are supplied to the whole-sellers and retailers in un-chilled condition consequently the chilling charges could not be included in the retail price of articles/goods sold. It has also been admitted before us that retail price is printed on each bottle or packet as required by sub-section (2) of section 4 of the said Act, therefore, excise duty would be charged only on the retail price fixed by the manufacturer, considering that the manufacturer has not incurred any amount on the chilling process therefore cannot charge the same towards the retail price fo be fixed by him. The inclusion of the chilling charges towards the retail price of the article when the same is not incurred by him would be against the spirit of sub- section (2) of section 4 of the said Act. Even if it be assumed that the retailers sell their aerated water/juices in chilled condition, then also, because the factories supply the said beverages/juices in un-chilled condition, the expenses incurred on chilling cannot be included in the retail price by the manufacturers. There is no logic to burden the retailers, who have to sell the articles to the consumers, with the chilling charges when the same have not been received by them in chilled condition. In the circumstances, the respondents cannot be compelled to add chilling charges, not incurred by them, towards the retail price.
8.No other plea has been raised before us consequently we do not find any merit and substance in the contention of the learned counsel for the appellants/petitioners. However, there is force and substance in the submissions made by the learned counsel for the respondents. The facts of the cases cited above are quite different and distinguishable to the facts of the instant appeals and petitions except the facts of Atlas Battery Limited, Karachi Vs. Superintendent Central Excise and Land Customs Circle 'C' Karachi and others (PTCL 1984 CL 250=PLD 1984 SC 86) which to some extent support the case of the respondents that in terms of sub-section (2) of section 4 of the Central Excises Act, 1944 it would be the prerogative of the manufacturer to fix the retail price. The leamed Judge in Chambers has given cogent and valid reasons in support of the impugned judgments/orders. In view of the aforesaid reasons, we do not find any merit in these appeals and the petitions, which are hereby dismissed. revisions by the competent authorities. Therefore, it is advisable to consult the official sources or legal professionals for the most up-to-date and accurate information.