ASLAM TRADERS vs ASGHAR ALI TAHIR And Others
These appeals arose from a consolidated judgment of the Lahore High Court, which had dismissed the petitioners' constitutional petitions on the ground of non-maintainability due to the availability of an alternative remedy of appeal under Section 23C(4) of the Foreign Exchange Regulation Act 1947. Despite holding that the writ petitions were not maintainable, the High Court proceeded to record findings on the merits of the case regarding the petitioners' default in repatriating foreign exchange. The Supreme Court of Pakistan considered whether a High Court, after finding a constitutional petition non-maintainable due to an alternative statutory remedy, is justified in rendering findings on the merits of the dispute. The Supreme Court held that recording findings on merits after dismissing a petition on maintainability grounds causes grave prejudice to the parties. Consequently, the Supreme Court set aside the High Court's findings on the merits, converted the petitions into appeals, and directed the petitioners to approach the proper appellate forum within twenty days, granting them condonation of delay for the period spent litigating before the High Court.
- Is a High Court justified in recording findings on the merits of a case after holding that a constitutional petition is not maintainable due to the availability of an alternative statutory remedy?
- Can a party who bypassed an alternative statutory remedy be granted benefit of the time spent in constitutional litigation before the High Court for the purposes of limitation in filing an appeal?
- Section 12(1), Foreign Exchange Regulation Act 1947
- Section 23C(4), Foreign Exchange Regulation Act 1947
- Article 199, Constitution of Pakistan 1973
JUDGMENT IRSHAD HASSAN KHAN, ACJ.- This judgment shall dispose of Civil Petitions No. 952-L/99, and 1188-L/99 to 1211-L/99 arising out of a consolidated judgment dated 8.6.1999 and involving identical questions of law and facts, passed by a learned Single Judge of the Lahore High Court in Writ Petition No. 15482/1998 and 16399 to 16422/1999.
2. It is pleaded that the petitioners herein were registered as Exporters with the Chief Controller of Imports and Exports, Karachi. They started exporting ready-made garments to what was then West Germany, through M/s Piracha Import Export Grosshandle Wurzel Str, Frankfurt Main Germany. Each time goods were exported, the petitioners were required to fill-in form E, declaring the quantity of the goods being exported, its invoice valued in foreign currency, and giving an undertaking that the amount in foreign currency when received, shall be paid into the State Bank of Pakistan Petitioners allegedly continued their said export business from 1986 onwards, and paid into the Government Treasury a huge amount of foreign exchange, itis alleged that after the unification of East and West Germany in 1989, for reasons over which the petitioner had no control, the business in Germany of the petitioners started falling, and finally in 1996-97, it reached such a law ebb that the firm had to go into liquidation, itis also alleged that the Banks, namely, Faisal Bank Limited, Citi Bank Limited and Standard Chartered Bank Limited, Faisalabad, through which the business of the petitioners was being conducted reported the matter of default to the State Bank, as required by law. The complaint was then referred u/s 12(1) of the Foreign Exchange Regulation Act, 1947 (hereinafter called the Act), to the office of Mr. Asghar Ali Tahir, Additional Director of Adjudication for Punjab, State Bank of Pakistan Building, 11th Floor, Shahrah-e-Quaid-e- Azam, Lahore, itis further pleaded that the matter was heard under the Adjudication Proceedings and Appeal Rules, 1988 and finally an order was passed on 30.6.1998 whereby a fine of Rs. 63,695,000/- (Rupees Sixty three Million, Six Hundred and Ninety five thousand only) was imposed on the petitioners "with the direction to deposit the said amount of penalty in Government Account maintained with the State Bank of Pakistan immediately, failing which the same shall be recovered from them through the District Collector, as Arrears of Land Revenue."
3. The petitioners being aggrieved with aforesaid' order, approached the Lahore High Court through Constitutional petitions, which were dismissed through consolidated order dated, 8.6.1999, being not maintainable, on the ground that the remedy of appeal under Section 23C(4) of the Act, 1947, was not invoked. 0n merits, it was also observed that the petitioners were unable to show that under the German Law a mere declaration of bankruptcy without any order of the competent authority was enough to confer the status of bankruptcy upon the declarant, itwas further observed that in view of the evidence on record the petitioners had directly received foreign currency from the importer.
4. Mr. Maqbul Elahi Malik, Senior ASC, learned Counsel for the petitioners vehemently argued that the learned Judge in Chambers after having held that the exercise of jurisdiction under Article 199, of the Constitution was dependent upon non-availability of adequate remedy, there was no justification for recording findings on merits, which has resulted into grave prejudice to the petitioners.
5. After hearing the learned counsel for the petitioners and Mr. Khawaja Saeeduz Zafar, learned Deputy Attorney General, we find that the contention raised by the learned counsel for the petitioners is not without force. Resultantly, we convert these petitions into appeals and set aside the impugned judgment of the High Court to the extent of findings on merits of the case, In consequence, the petitioners are allowed to avail remedy of appeal before the proper forum within 20, days from today, which, if filed, the said forum shall give benefit as regards delay of the period during which writ petitions remained pending before the High Court and shall decide the appeal on merits as well as the prayer for interim relief. Meanwhile, no coercive measures will be taken against the petitioners for a period of 20 days from today to enable them to approach the appropriate forum. The appeals are allowed in the above terms. There shall be no order as to costs.