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(a) Municipal Administration Ordinance (X of 1960)‑

‑‑ Ss. 33 & 41 ‑ West Pakistan Municipal Committees Octroi Rules, 1964, R. 3(1) ‑ Change in tax structure by Municipal Committee ‑ Procedure for modification of taxation proposal narrated.

(b) Municipal Administration Ordinance (X of 1960)‑

--------Ss 33 & 41 ‑ West Pakistan Municipal Committees Octroi Rules. 1964, Rr. 4 & 6(6)‑Notices for imposition of tax‑Require ment‑Two distinct notices contemplated as part of procedure for imposition of tax by Municipal Committees‑First notice is to be given under R. 4 of Tax Rules inviting objections to preliminary tax proposal‑Second notice, held, is required to be given under R. 6(6) of Tax Rules inviting objections or suggestions to final taxation proposal.

(c) Municipal Administration Ordinance (X of 1960)‑

-----Ss. 33 & 41 ‑ West Pakistan Municipal Committees Octroi Rules, 1964, Rr. 4 & 6(6)‑Notice for tax proposal, held, was required to be issued by Chairman‑Notice thereof issued by Taxa tion Officer of Municipal Corporation would be nullity in law Notice would otherwise be defective where same did not specify date for filing of objections or suggestions‑Object behind issuing notice alongwith taxation programme is to enable persons likely to be affected by such proposed taxation to file objections or sugges tions qua such taxation.

(d) Municipal Administration Ordinance (X of 1960)‑

‑‑ Ss. 33 & 41‑Law Reforms Ordinance (XII of 1972), S. 3‑Cons titution of Pakistan (1973), Art. 199‑Constitutional jurisdiction- Locus standi to invoke‑Where no notice allowing 30 days, time to aggrieved persons for filing objections or suggestions qua increase in octroi duty was issued, non‑filing of objections by such aggrieved persons, held, would not debar them from assailing said increase by invoking constitutional jurisdiction of High Court ‑ A valuable right having been denied to ‑ affected persons by not allowing them time requisite for making objections‑Having been adversely affected by enhanced octroi duty, they would be aggrieved persons and would have locus stand to invoke constitutional jurisdiction of High Court‑Order of High Court declaring enhancement of octroi duty as without lawful authority and of no legal effect was upheld in Intro‑Court Appeal.

Syed Fayyaz Hussain Qadri for Appellant.

MUHAMMAD ILYAS, J.

‑This order will dispose of I. C. A. No. 116 of 1986 Lahore Municipal Corporation v. D. P. Edulji and others and L‑C. A. No. 117 of 1986 Lahore Municipal Corporation v. Raja Wines and others together as, common questions of law are involved, in these appeals.

2. In brief, the facts in each case areas follows:‑

(i) I.‑C. A. No. 116 of 1986

Respondents 1 to 3, D. P. Edu1ji & Co.; Mian Salah‑ud‑Din, Proprietor English Wine Agency; and Mian Rafi‑ud‑Din, Proprietor, French Wine, sell liquor including beer, wine, whisky and other alcoholic drinks. The said drinks when imported within the octroi limits of Lahore

Municipal Corporation are subjected to octroi duty. Before 1‑7‑1972, the rates of octroi duty being charged from these respondents were as follows:‑

Rs.

(i) Bear‑all kinds including imported ones. 0.50 per maund.

(ii) Wine‑all kinds and imported ones. 5 per maund.

On 22‑6‑1972, the Commissioner, Lahore ' Division, in his capacity as the controlling authority of Lahore Municipal Corporation issued Notification No. 1‑61(B)/6554 laying down the following new schedule of octroi rates effective from 1st July, 1972:‑

( ) Bear‑all kinds including imported ones. 15 per maund.

(ii) Wine‑all kinds including imported ones. 15.00 per maund.

The said respondents, feeling aggrieved by the said notification and increase in octroi duty, tiled Writ Petition No. 1395 of 1972 inter alia on the ground that the said notification was issued in violation of the Municipal Admini stration Ordinance, 1960 and rules framed thereunder.

(ii) I. C. A. No. 117 of 1986

Respondents 1 and 2, Raja Wines; and Phipson & Company (Pakistan) Limited were doing the business of selling liquor including beer, wine, whisky and other alcoholic drinks. When they imported the said items in the octroi limits of Lahore Municipal Corporation, they paid octroi duty which was enhanced by the Commissioner, Lahore Division, in his capacity as the controlling authority by the notification dated 22‑6‑1972. Feeling aggrieved, they tiled Writ Petition No. 1581 of 1972 on grounds similar to tae grounds in Writ Petition No. 1395 of 1972.

Both these writ petitions were placed before a learned Judge in Chambers who accepted them by one judgment dated 19‑5‑1986 impugned in these appeals. It was held by the learned Judge in Chambers that the Lahore Municipal Corporation did not issue notice under rule 4 of the West Pakistan Municipal Committees (Imposition of Taxes ‑ Rules, 1960, (hereinafter referred to as the Tax Rules). The learned Judge held that rule 4 of the Tax Rules conferred valuable rights on the tax payer to file objections against the proposed increase in duty; that the provisions of rule 4 were mandatory; and that its non‑compliance was fatal to the increase in the levy. The learned Judge, therefore, ruled that the increase in the octroi duty on alcoholic drinks made under the notification afore said was without lawful authority and of no legal effect.

3. In support of these appeals, it is contended on behalf of the appellants that the wine dealers (writ petitioners) did not file objections after issuance of public notice dated 23‑8‑1971 (Apnexure 'C. l' in Writ Petition No. 1395 of 1972 and Annexure'C' in Writ Petition No. 1581 of 1972) and as such, they had no locus standi to challenge the impugned notification dated 22‑6‑1272; secondly, the Lahore Municipal Corporation issued two notices‑one published in the daily "Pakistan Times", Lahore on 13‑8‑1971 requiring any inhabitant to submit objections or suggestions to the proposed octroi schedule in writing within thirty days of the publica tion of the notice to Administrator, Lahore Municipal Corporation and the second published in the daily "Pakistan Times", Lahore on 3‑10‑1971 notifying the taxation programme fixing the date of hearing of objections and the date of submission of report by Sub‑Committee, etc. It was, therefore, argued that there was no contravention of rule 4 of the Tax Rules justifying acceptance of the two writ petitions.

4. We have considered the contentions raised on behalf of the appellants.

5. It seems proper to examine relevant provisions of law regarding imposition of taxes by Municipal Committees. A perusal of the Tax Rule framed by the Governor of West Pakistan in exercise of the power conferred by sections 33 and 41 of the Municipal Administration Ordi nance, 1960, would show that under sub‑rule (1) of rule 3 while framing the annual or the revised budget of the Municipal Committee, the Chair man of the Committee shall review the financial position of the Committee and if in his opinion, the financial position calls for any change in the tax structure, he shall formulate tax proposals and incorporate them in an Appendix to the budget. The Municipal Committee, while sanctioning the annual budget or the revised budget, as the case may be, shall decide whether any of the taxation proposals formulated under sub‑rule (l of rule 3 shall be dropped or proceeded without modification or wit modifications as may be approved by the Municipal Committee. The budget containing the taxation proposals shall be forwarded to the control ling authority who, while considering the budget may confirm, modify o reverse any decision of the Committee under this rule. Immediately after the annual budget or the revised budget has been sanctioned, the Chairman shall issue a public notice, in respect of the taxation proposal to be proceeded with under rule 3, in accordance with rule 4 of the Tax Rules. The said rule 4 is comprehensive in nature. Sub rule (1) of rule 4 require that the notice shall specify the main features of taxation proposal, person effected thereby, the amount or rate of the proposed tax, system o assessment, justification of tax proposal and other particulars considerer necessary. Sub‑rule (2) of rule 4 provides that aloagwith the public notice under sub‑rule (1), the Chairman shall publish a taxation programme specifying the date which shall not be less than thirty days from publica tion of the notice by which objections or suggestions to the preliminary taxation proposal may be made to the Municipal Committee by the inhabi tants the date/dates fixed for hearing of the objections and suggestions; the date by which the Sub‑Committed appointed under sub‑rule (t) of rule shall submit its report to the Municipal Committee; the date when the special meeting of the Committee will be held to consider the report; the.; date by which final taxation proposal shall be sent to the Government for final approval. The taxation proposal will be finalised under rule 6 of the Tax Rules by the Municipal Committee whereafter the Chairman shall send the taxation proposal as approved by the Municipal Committee to the Commissioner endorsing copies to the Collector of the District and the Government, accompanied by the specified documents. As soon as the taxation proposal is forwarded to the Commissioner/Collector, the Chairman shall publish a public notice under rule 6(6) of the Tax Rule defining the main features of the final proposal and providing that an inhabitant may submit his objections or suggestions to the taxation proposal in writing to the Commissioner within thirty days, of the publication of sac notification.

6. It is apparent from the above analysis of various rules that a taxation proposal in order to attain finality has to pass through five different stages. Firstly, under rule 3, the Municipal Committee while sanctioning the budget has to take a decision whether to drop or to proceed with the taxation proposal and if it decides to proceed with, to incorporate the same in it. Secondly, immediately after the annual budget, a notice, under rule 4 has to be published by the Chairman specifying main features of proposal and inviting inhabitants to file objections or suggestions to preliminary proposal with Municipal Committee within thirty days of the publication of the notice. Thirdly, fixing date of hearing of the objections and suggestions to the preliminary taxation proposal. Fourthly, all objections and suggestions received from the inhabitants shall be entered in a register maintained for the purpose under rule 5 which further provides that the Municipal Committee shall appoint a Sub‑Committee consisting of its Chairman and such other members as may be specified, to examine the objections and suggestions. The Sub‑Committee, on the date fixed for hearing of objections and suggestions, shall hear the same in public and on the close of hearing draw up and send to the Municipal Committee its detailed report by the fixed date. Fifthly, finalisation of the taxation proposal by the Municipal Committee after receipt of a detailed report by the Sub‑Committee and forwarding the taxation proposal to the Commissioner with copies to the Government and also publication of a fresh public notice under sub‑rule (6) of rule 6 inviting objections or suggestions from the inhabitants to the final taxation proposal within thirty days of the publication of such notice.

7. On a perusal of the documents placed on record, it will be observed that the first public notice (Annexure 'C. 1') was published on 23‑8‑1971 in the daily "Pakistan Times", Lahore by the Administrator, Lahore Municipal Corporation. The second public notice (Annexure ' D 1') was published on 3‑10‑1971 in the daily "Pakistan Times", Lahore, by the Taxation Officer, Lahore Municipal Corporation, indicating the date fixed for hearing public objections/suggestions; the date of submission of report by the Sub‑Committee and the date by which final taxation proposal shall be sent for final sanction by the controlling authority. It was admitted by the (earned counsel that only these two public notices were issued by the Lahore Municipal Corporation. Argument of learned counsel for the appellant was that notice, Annex. 'C. I', coupled with notice, Annex. D. 1, satisfied the requirements of rule 4 and, therefore, the notification in question could not be knocked down on the ground that provisions of the said rule were not complied with before the notification was issued. It was explained by him that Annexs. C. 1 and D. 1 were issued in terms of sub‑rule (I) and sub‑rule (2) of rule 4, respectively.

8. As is evident from the notice, Annexure 'C. 1', it is a notice under rule 6(6) of the Tax Rules. It cannot, therefore, be considered as a notice under rule 4 or as a substitute thereof. A perusal of the Tax Rules clearly indicates that two distinct notices are contemplated as part of the procedure for imposition of taxes by Municipal Committees. The, first notice is to be given under rule 4 inviting objections to the preliminary taxation proposal and second notice is to be given under rule 6(6) inviting objections or sugges tions to the final taxation proposal. Annexure C. 1' is, therefore, of no avail to the appellant so far as the requirements of rule 4 are concerned.

9. As for Annexure D. 1', it appears to be taxation programme which is required to be issued under sub‑rule (2) of rule 4. It is not a notice which is to be given under sub‑rule (1) of rule 4 inasmuch as the informa tion, etc., required to be furnished to the public under sub‑rule (1) of rule 4 is not given in Annexure 'D. 1'. It cannot, therefore, be treated as a notice under sub‑rule (1) of rule 4.

10. Annex. 'D. 1' cannot be regarded as valid taxation programme either because it was not issued by a competent authority. As explained above it is to be issued by the Chairman of the Municipal Committee who, in the present case, was the Administrator of the Lahore Municipal Corporation. It was, however, issued by the Taxation office of the Municipal Corporation. It is, therefore, a nullity in the eye of law.

11. Further. Annex. D. 1' is deficient in contents. It does not specify the date for filing of objections or suggestions. It should have been a date after 30 days of the publication of the taxation programme It also does not mention the date of special meeting of the Municipal Corporation at which the report of the Sub‑Committee was to be considered. Annexure 'D. 1', therefore, does not satisfy the requirements of clauses (a) and (d) of sub‑rule (2) of rule 4.

12. What emerges from the above discussion is that no notice under sub‑rule (1) of rule 4 was given to the public. As stated above, Annexure 'C. 1' is notice under sub‑rule (6) of rule 6 and not under sub‑rule (1) of rule 4. Annex. 'D. 1' purports to be taxation programme which, under sub‑rule (2) of rule 4. is to be issued alongwith notice under sub‑rule (1) of rule 4 but, as explained above, this was not issued by a competent authority and also does not fulfil the requirements of sub‑rule (2) of rule 4. We are, therefore, unable to agree with learned counsel for the appellant that Annex. 'C.1' coupled with Annex. 'D.1' satisfied the requirements of rule 4.

13. Object behind issuing notice, alongwith the taxation programme, under rule 4 is to enable person who are likely to be affected by the proposed taxation to file objections or suggestions qua such taxation. They are to be given at least 30 days for so doing. In the present case however, no such notice was issued. Even notice, Annexure 'D. 1', which at best, is the taxation programme only, did not allow that much time fur the making of objections or suggestions. It was published on 3rd October, 1971 and the date fixed for hearing of objections or suggestions was 7th October, 1971. In this way, 4 days and not 30 days were allowed for filing objections or suggestions, in disregard of the provisions of clause (a) of sub‑rule (2) of rule 4.

14. Since no notice allowing 30 days' time to the writ petitioners for filing objections or suggestions qua the impugned increase in octroi duty was issued, their non‑filing of objections did not debar them from assailing the said increase by invoking Constitutional jurisdiction of this Court. A valuable right was denied to them by not allowing them requisite time for making objections. They were adversely affected by the notification in question because they will have to pay octroi duty at enhanced rates. They were therefore, aggrieved persons and had locus standi to file the writ petitions.

15. In result, we agree with the learned Judge in Chambers that notification under review was issued without complying with mandatory provisions of rule 4 and, therefore, it is without lawful authority and of no legal effect. This appeal, accordingly, fails and is dismissed in limine.

A. A. Appeal dismissed.

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