HIRJINA & CO. (PAK.) LTD. Versus ISLAMIC REPUBLIC OF PAKISTAN
The petitioners challenged the levy of excise duty on services provided by hotels, restaurants, and bars in relation to alcoholic liquor, arguing that under section 3(1) of the Central Excises and Salt Act, 1944, the levy constitutes a duty on 'alcoholic liquor' itself. They contended that such a levy is prohibited by the bar contained in Entry 43(b) of the Third Schedule of the 1962 Constitution. Furthermore, the petitioners questioned the constitutional validity of imposing excise duty on services rendered by these establishments. The Supreme Court observed that the issues raised regarding the constitutional competence of the levy and the interpretation of the relevant constitutional provisions were of general public importance requiring an authoritative adjudication. Consequently, the Court granted leave to appeal, allowed the petitions, and directed that the appeals be heard on the existing record, while permitting parties to file additional documents. The Court also issued notice regarding the petitioners' request for interim relief.
- Does the levy of excise duty on services rendered by hotels, restaurants, and bars in relation to alcoholic liquor constitute a duty on the liquor itself?
- Is the levy of excise duty on services provided by hotels, restaurants, and bars constitutionally permissible under the 1962 Constitution?
- Section 3(1), Central Excises and Salt Act 1944
- Entry 43(b), Third Schedule, Constitution of Pakistan 1962
ORDER
1. ABDUL QADIR SHAIKH, J.‑ Learned counsel for the petitioners submit that the excise duty levied under section 3(1) of the Central Excises and Salt Act, 1944 in relation to excisable services provided or rendered in rela tion to alcoholic liquor is in its pith and substance, a duty on "alcoholic liquor" and cannot, therefore, be levied due to the bar contained under Entry 43 (b) of the Third Schedule of the 1962 Constitution. '
2. Learned counsel further submitted that even otherwise levy of duty on services by hotel, restaurant and bar, as an excise duty, is constitutionally not permissible.
3. These and other questions raised by the learned counsel are of general public importance and deserve an authoritative decision of this Court.
4. Leave is granted and the petitions are allowed. Security Rs. 2,500 in each case. Appeals will be heard on the present record. It is, however, open to the parties to file additional documents, if any.
5. Notice of Miscellaneous Petitions for grant of interim relief to issue to the Deputy Attorney‑General for a date in office.
6. Leave granted.