M/s ABDUL WAHID ABDUL MAJID vs GOVERNMENT OF PAKISTAN and others

ORDER

' AJMAL MIAN, J.---This is a petition for leave to appeal against the judgment dated 16-5-1991 passed by a Division Bench of the High Court of Sindh in CP No,D-897/87 filed by the petitioner, dismissing the same on the ground that the case was covered by the three judgments of the Division Benches of the High Court of Sindh referred to in the impugned judgment. The petitioner has, therefore, filed the present petition.

2 The brief facts are that the petitioner obtained two import Licences in 1986-1987 for the import of Edible Vegetable Oil. It is the case of the petitioner that when they obtained the above import licenses and opened L/C, the customs duty was payable @ Rs,2350 per metric ton, which was increased to Rs3,000 per metric ton by a notification dated 24-9-1986 besides imposing regulatory duty. According to the petitioners the above increase in the rate of customs duty has impaired their vested rights, as per ground No,2 of the petition, which reads as follows:-- "(ii) The petitioner's vested rights to import the said oil against payment of import duty @ Rs,2350 per metric ton (which was prevailing on the date of grant of import licences and opening of Letter of Credits) has been violated by arbitrary unwarranted and uncalled for increase in duty".

3. In support of the above petition Mr. Nasim Akhtar Farooqi, learned ASC for the petitioners have vehemently urged that section 31-A of the Customs Act 1969 hereinafter referred to as the Act is violative of Article 73 of the Constitution as while enacting it the procedure laid down therein was not followed inasmuch as the above section 31-A was incorporated by the Finance Ordinance 1988 and thereafter by Finance Act 1989. We have noticed that no such ground was raised by the petitioners in their memo of Constitutional Petition before the High Court. In our view, h is not necessary to go into the above controversy as the petitioners' case falls under section 30 of the Act.

Suffice to observe that such a contention was raised before this Court in a number of appeals decided recently, but the same was not found favour with the Bench, which heard the said appeals.

4. We may point out that section 30 of the Act provides dates on the basis of which the value and the rate of duty are to be determined, which inter alia provides that in case of goods cleared for home consumption under section 79, the value of the imported goods and rate of duty shall be, on the basis of date on which a bill of entry is presented under that section. The petitioners have been charged custom duty as aforesaid and, therefore, they cannot have any legitimate grievance to agitate. It may be observed that the date of issuance of an import licence or the fact= of issuing of an import licence has not nexus with the rate of custom duty payable on the goods imported, as the State while issuing an import licence does not make any representation, that it will not impose new custom duty or will not increase the rate of it if already imposed.

5. However, it may be stated that the judicial activitism innovated doctrine of promissory estoppel.

One of the earliest judgments of this Court is in the case of Collector of Central Excise and Land Customs and others v.Azziuddin Industries Ltd. Chittagong (PLD 1970 SC 439) in respect of excise duty, wherein it has been held that since, the appellant had set up cigarettes manufacturing factory on the basis of notification granting exemption from payment of excise duty for the period from 1-7-1961 to 30-6-1962, the executive authority cannot in exercise of the rule making power or the power to amend, vary or rescind an earlier order, take away the rights vested in the citizens. The above doctrine was reiterated and re-inforced by this Court first time in a case pertaining to payment of Custom Duty in the case of Al-Samraze Enterprise v. Federation of Pakistan (1986 SCM R 1917) wherein it was held that "the exemption notification is basically addressed to public at large or in any case to prospective importers. It will be inequitable and unjust to deprive a person who acts upon such assurance of the right to exemption and expose him to unforeseen loss in the business transaction by suddenly withdrawing, the exemption after he has made legal commitments. It is in this perspective that right is created in his favour and a subsequent withdr' awal of exemption cannot be given retrospective operation by an executive act to destroy this right.

' In order to nullify the effect of the above judgment section 31-A of the Act was enacted in 1988. In a recent judgment in the case of Mian Nazir Sons Industries Ltd. And another v. Government of Pakistan (1992 SCM R 883) this Court has considered the effect of section 31-A as follows:- "In a recent case which specifically dealt with the doctrine of promissory estoppel, this Court in Pakistan v. Salahuddin (PLD 1991 SC 546) has held that the same cannot be invoked against legislature or laws framed by it because the Legislature cannot make a representation. The case of Muhammad Aslam from this Court also dealt with the Import Policy and the right to obtain an import licence. Therefore the cases relied upon are distinguishable. In the case in hand the question is whether a concession once extended under section 21 on the basis of which contract was entered into, created vested rights so as to deprive the competent authority from rescinding such a special order. As it is not disputed that the payment of duty is not discharged in such a case, it is idle to pursue the matter, because no vested right would accrue in favour of an importer to refuse payment of duty subsequently upon recission or revocation of such an order. Additionally as discussed hereinabove, section 31-A now clearly stipulates that any amount of duty which become payable in consequence of withdrawal of a concession from duty, even though such withdrawal takes place after the conclusion of a contract for the sale of goods or opening of a letter of credit, would now be payable in terms of section 30 with reference to the date of filing of the Bill of Entry."

6. In the case in hand no exemption from the payment of custom duty was granted and, therefore, the ratio decidend of Al-Samraze's case Supra cold not have been pressed into service by the petitioners even when it was holding the ground. But after the incorporation of section 31-A Al- Samraze's case is no longer available for invoking in aid the doctrine of promissory estoppel in case of withdrawal of exemption from payment of custom duty.

' The petition has no metis, and, therefore, leave is refused.