MUHAMMAD YOUNUS SHAIKH VS FEDERATION OF PAKISTAN, 2006 PTD-KARACHI-HIGH-COURT-SINDH 1036 (2006)

2006 P T D 1036

[Karachi High Court]

Before Muhammad Mujeebullah Siddiqui and Sajjad Ali Shah, JJ

MUHAMMAD YOUNUS SHAIKH

Versus

FEDERATION OF PAKISTAN through Secretary Revenue Division, Central Board of Revenue, Islamabad and 3 others

Constitutional Petition No. D-134 of 2006, decided on 15/02/2006.

(a) Export Processing Zones Authority Ordinance (IV of 1980)---

---S.11 (3)---Export from Zone to Tariff area---Control---No power has been conferred upon 'Export Processing Zones Authority, under S.11 (3) of Export Processing Zones Authority Ordinance, 1980, to control export from the Zone to Tariff area or to other countries---Industry set up in Export Processing Zone, under S.11 (3) of Export Processing Zones Authority Ordinance, 1981, cannot take out any material ,or manufactured goods from the Zone to Tariff area except to the extent and in the manner to be specified by the authority in each case---Permission in such behalf is to be accorded by the authority with the prior approval of Federal Government.

(b) Export Processing Zones Authority Ordinance (IV of 1980)---

----S. 27---Power to make rules---Federal Government and Export Processing Zones Authority---Jurisdiction---Scope---Power to make rules under S.27 of Export Processing Zones Authority Ordinance, 1980, has been conferred on Federal Government and not on the Authority---Export Processing Zones Authority has been conferred the power to make regulations with prior approval of Federal Government not inconsistent with the provisions of Export Processing Zones Authority Ordinance, 1980, or the rules.

(c) Interpretation of statutes-

----Provisions of statute, reading of---Principles---No provision is to be read in isolation and entire scheme is to be kept in view while interpreting a particular provision---Expressions and provisions take their colour and complexion from the context in which they are used.

(d) Interpretation of statutes---

----Subordinate legislation---Effect---Rules are in the category of subordinate legislation and such legislation can never have overriding effect on an Act of Parliament---Even if one subordinate legislation is repugnant to other subordinate legislation, it does not make either of them to be invalid---In order to make a subordinate legislation to be invalid it has to be shown that either it is beyond the jurisdiction of the authority exercising power of delegated legislation or it was violative of the provisions of the Act of Parliament or is repugnant to any provision of the Constitution.

(e) Customs Export Processing Zone Rules, 1981---

----R.6--- Goods produced in Zone---Home consumption---Procedure---Goods produced by investors in a Zone to Tariff area for home consumption may be allowed subject to import restrictions---Such goods may be taken out of Zone after fulfilling all the requirements prescribed under Customs Act, 1969 and rules made thereunder for direct import from abroad into the Tariff area.

(f) Interpretation of statutes---

----Deeming provision---Scope---Legislature is empowered to enact deeming provisions, meaning thereby to give a particular meaning and connotation by fiction of law, which in fact does not exist---Such deeming provisions by fiction of law are to be treated at par with actual acts to all intents and purposes and are to be taken to their logical conclusions---While taking deeming provisions to their logical conclusion, the vision is not to be marred or blurred.

(g) Customs Act (IV of 1969)---

----Ss.16 & 219---Imports and Exports (Control) Act (XXXIX of 1950), S.3 (3)---Export Processing Zones Authority Ordinance (IV of 1980), S.26---Notifications S.R.O. No.46.1 (I)/2004, dated 12-6-2004 & S.R.O. No.634(1)/2004, dated 22-7-2004---Constitution of Pakistan (1973), Art.199---Constitutional petition---Vires of Notifications S.R.O. No.461 (I)/2004, dated 12-6-2004 & SRO No.634(1)/2004, dated 22-7-2004--Scope-Federal Government being empowered under S.26 of Export Processing Zones-Authority Ordinance, 1980, to frame rules it had framed the Export Processing Zones Authority Rules, 1981---Central Board of Revenue had issued notification S.R.O. 249(1)/81, dated 25-3-1981, whereunder R.6 of Customs Export Processing Zone Rules, '1981, had rightly dealt with the levy of taxes and duties only if and when export or import under Export Processing Zones Authority Ordinance, 1980, took place---Notification S.R.O. No. 634(I)/2004, dated 22-7-2004, issued by Federal Government in exercise of powers conferred by S.3(1) of Imports and Exports (Control) Act, 1950, in the form of Import Policy Order, 2004, was a valid piece .of delegated legislation---By virtue of provisions contained in S.16 of Customs Act, 1969, read with S.3 (3) of Imports and Exports (Control) Act, 1950, the Central Board of Revenue was empowered to frame rules in exercise of powers under S.219 of Customs Act, 1969, therefore, Notification S.R.O. No.461(1)/2004, dated 12-6-2004, amending various rules in Customs Rules, 2001, including addition of sub-rule (4) in Rule 228 was in accordance with the law and was not open to any exception---Petition was dismissed in limine.

Writ Petition No. 1644 of 2004 distinguished.

Messrs Sikandar & Brothers v. Government of Pakistan PLD 1986 Kar. 373 ref.

Sultan Ahmed Shaik for Petitioner.

Nemo for Respondents.

Date of hearing: 15th February, 2006.

JUDGMENT

MUHAMMAD MUJEEBULLAH SIDDIQUI, J.---The petitioner has sought the following reliefs:--

"It is therefore prayed that:-

(A) The S.R.O. No.461(I)/2004, dated 12th June, 2004 and S.R.O. No.634(1)/2004, dated 22nd July, 2004 may be declared as repugnant to the provisions of the Ordinance and also illegal, void and of no legal consequence.

(B) Direct the Respondents not to give effect to the said two S.R.Os.

(C) Any other/further/better relief, which this Hon'ble Court may deem fit and proper in the circumstances of the case.

(D) Cost of the proceedings."

2. We have specifically asked the learned counsel for the petitioner to show the provision in the Export Processing Zones Authority Ordinance, ' 1980, of which the two impugned S.R.Os? are violative. The learned ' counsel is not able to show us any such provision in the said Ordinance. The learned counsel for the petitioner has placed reliance on S.R.O. No'.249(I)/81 issued by the C.B.R. under section 219 of the Customs Act, 1969. The learned counsel was pointed out that S.R.O. No.249(I)/81 and the impugned S.R.O. No.461 of 2004, have been issued in exercise of the powers conferred under section 219 of the Customs Act, 1969, and has been confronted to show as to how the subsequent S.R.O. issued under the same provision can be ultra vires, when the earlier S.R.O. issued by the same authority under the same provision is being relied upon by the petitioner as a good piece of delegated legislation. The learned counsel' has no explanation. The learned counsel has not addressed any arguments, so far, S.R.O. No.634(I) of 2004 is concerned.

3. In addition to his contention that the two impugned S.R.0's are violative of the provisions contained in Export Processing Zones Authority Ordinance, 1980, he has placed reliance on an unreported D.B. Judgment of the Peshawar High Court, in Writ Petition No.1644 of 2004, dated 4-10-2005.

4. We have gone through the above judgment, and with due defence, and all respects for the Honourable Judges of the Peshawar High Court, we are not able to persuade ourselves to agree with the opinion recorded in the said judgment.

5. After arguing at length, Mr. Sultan Ahmed Shaikh, sought permission to withdraw the petition. The permission is not granted for the reason that a judgment of the Peshawar High Court is in the field with which we do not agree and therefore, we feel it imperative, that a judgment be recorded by us containing our reasons for disagreeing with the view of the Hon'ble Judges of the Peshawar High Court.

6. A perusal of the D.B. Judgment of the Peshawar High Court, in Writ Petition No.1644 of 2004, dated 4-10-2005, shows that the validity of S.R.O. No.461(I)/2004, dated 12-6-2004, issued by C.B.R. under section 219 of the Customs Act, making amendments in the Customs Rules, 2001 and S.R.O. No.634(I)/2004 issued by the Government of Pakistan, Ministry of Commerce on 22-7-2004 were challenged to the extent of provisions specifying that the units established for the Export Processing Zones shall export only upto 20% of their total production to tariff areas in Pakistan and the remaining to other .countries. It was argued on behalf of the petitioners in the above -petition that where a special incentive under special package was given to the entrepreneurs for establishing Export Processing Zones, on their export therefrom could be made after the units established went into production. It was further contended that the extent of export of the materials and manufactured goods from the zones to the tariff areas could be specified only in accordance with the provisions of the Ordinance, (Export Processing Zones Authority Ordinance, 1980) and not otherwise, therefore, the S.R.Os. specifying the extent to which export could be made to tariff areas were repugnant to the provisions of the above Ordinance and rules made thereunder which were liable to be struck down.

7. The learned counsel -representing Export Processing Zones Authority conceded that the impugned S.R.Os. Were not in consonance with the provisions of the Ordinance and rules made thereunder. He stated that he would not oppose the prayer of the petitioner for striking . down the S.R.Os.

8. The learned Deputy Attorney General appearing for the Ministry of Commerce argued that the Export Promotion falls within the purview of Commerce Division under the Rules of Business, 1973, therefore, the S.R.O. issued by the Ministry of Commerce restricting the export was competently issued under section 3(4) of the Import and Export (Control) Act, 1950. He further argued that the Federal Government had the powers to restrict or impose condition on the clearance whether for home consumption or shipment abroad of any imported goods or class of goods and therefore, the S.R.O's. were in accordance with the law.

9. The learned Judges of the Peshawar High Court examined the definition of expressions "tariff areas" and "zone" under the Export Processing Zones Authority Ordinance, 1980 (hereinafter referred to as the Ordinance). It was observed that the activity of export into tariff areas from the zone or import into the zone has been elaborately dealt with by Rule 11(5) of the export Processing Zones Rules, 1981, which reads as under:--

"Imports into the Zones from the tariff area shall be deemed to be export from Pakistan and imports into tariff area from the Zones shall be deemed to be imports from abroad and shall be subject to the same conditions and restrictions as are applicable to similar imports from abroad."

10. Rule 6(1)(2) of the Customs Export Processing Zone Rules, 1981 were also considered which read as follows:--

"(6) Removal of goods from the Zone to Tariff Area.---(l) Removal of imported raw materials, imported goods in the same state and goods produced by investors in a Zone to Tariff Area for home consumption may be allowed subject to the import restrictions and formalities applicable to imports from abroad, customs-duties and other taxes levied on imports into Tariff Area from the Zone shall be the same as duties and taxes levied on similar imports from aboard.

(2) Any goods permitted by the aforesaid authority for entry into the Tariff Area under sub-rule (1) may be taken out of the Zone after fulfilling all the requirements prescribed under the Act and the Rules made thereunder for the direct import from abroad into the Tariff Area."

11. After reproducing the above provisions, the learned Judges observed that a question crops-up whether the activity of import into a tariff area and export to any zone can be subject to any restriction by the general law of the land. Thereafter the learned Judges observed that before answering the question, it is worthwhile to refer to section 11 of the Ordinance. (The provisions of section 11 subsection (1) has been wrongly typed in the judgment). The contents of section 11 of the Ordinance are as follows:---

"(11). Sanctioning of industries, etc."---(1) The Authority may, with the approval of the Federal Government, frame schemes and lay down procedure in respect of sanctioning the establishment and operation of industries in the Zones.

(2) Any industry sanctioned under subsection (1) shall operate subject to such terms and conditions as may be enunciated in the letter of sanction issued by the Authority.

(3) The materials and manufactured goods shall not be exported from the Zones into the tariff area except to the extent and in the manner to be specified by the Authority in each case with the prior approval of the Federal Government."

12. The learned Judges of the Peshawar High Court, thereafter observed that a perusal of the above quoted provisions would reveal that the extent and manner of the goods to be exported from the zones and tariff areas shall be specified by the authority with the prior approval of the Federal Government. The Government of its own could not specify the extent and manner of the goods to be exported from the zone into tariff areas, notwithstanding the provisions contained in section 3 of the Import and Export (Control) Act, 1950, which deals into the export and import in general. It was further held that while the Ordinance in general and the rules made thereunder in particular deal with a different situation altogether inasmuch as they by virtue of the deeming clause, deeming incoming goods into the Zones and outgoing Zones into the tariff areas as export and import respectively. It was further held that their Lordships were of the view that the provisions of the Act, 1950 cannot be imported into the Ordinance, which provides its own mode, method and mechanism for regulating export. It was further observed that rule 6 of S-:R.O. 249(1)/81, dated 25-3-1981 also does not limit or reduce the power or authority in specifying the manner and extent of the materials and goods to be exported except emphasizing the levy of the taxes and duties if and when export or import under the Ordinance takes place.

13. It was observed that no doubt `export promotion' as per schedule to the Rules of Business, 1973 falls within the domain of the Commerce Division, but specification of the extent and manner of import into the tariff areas cannot be made by the said division in derogation of the provisions contained in the Ordinance and Rules as the Commerce Division has no power to issue S.R.O. regulating specification as no such justification has been put forth by the counsel for the respondents. It was observed that the counsel appearing for the respondents appeared to be apologetic in their instance with regard to the impugned S.R.Os and tend to shift the entire burden on the Export Processing Zones Authority. It was further observed that the learned Advocates have not attended to the point as to what prevailed with the C.B.R. while issuing S.R.O. No.461, dated 12-6-2005 and what is the rationale behind it.

It was also observed by the learned Judges of the Peshawar High Court that the petitioners and other entrepreneurs investing in the zones protested to the notification notified by the S.R.Os. because it is not advantageous to their enterprise. It was held that no change can be made in the original incentive package, unless it is more advantageous to them. It was also held that "The moreso when, it is clearly provided by Rule 24-A of the Export Processing Zones Authority Rules, 1981, that change in the incentive package under which investment has been sanctioned in a zone shall not be made except that such change is more advantageous to investor and is also accepted by him. The meaning behind section 11(5) of the Ordinance, become all the more, clear when read along with the above mentioned rule".

14. We have given our anxious consideration to the findings by the learned Division Bench of the Peshawar High Court. With all due deference and respect for the learned Judges, we are not able to persuade ourselves to subscribe to their views.

15. After very careful consideration of the Peshawar High Court judgment, we are not able to find out as to how the impugned S.R.Os. are violative of or repugnant to any provisions contained in the Export Processing Zones Authority Ordinance, 1980. The only section of this Ordinance referred to in the judgment of Peshawar High Court is section 11, which deals with the sanctioning of industries. Subsection (3) of this section merely provides that the materials and manufactured goods shall not be exported from the Zones into the Tariff area except to the extent and in the manner to be specified by the authority in each case with the prior approval of the Federal Government. By no stretch of imagination this provision can be read in a manner so as to confer power on the Export Processing Zones Authority, to control the export from the Zone to the Tariff area or to other countries. It merely provides that an industry set up in the Export Processing Zone shall not take out any A material or manufactured goods from the Zone to the Tariff area except to the extent and in the manner to be specified by the authority in each case. The permission in this behalf is to be accorded by the authority with the prior approval of the Federal Government. A perusal of the Export Processing Zones Authority Rules, 1981, framed by the Federal Government in exercise of powers conferred under section 26 of the Ordinance, shows that Rule 17(1) provides that entry and exit of persons and goods into and from a Zone shall be in accordance with the regulation framed by the authority. This provision is in consonance with the provisions contained in section 27 of the Ordinance, which provides that the authority may, with the approval of the Federal Government, make regulation, not inconsistent with the provisions of the Ordinance, or the rules, for carrying out the purposes of the Ordinance. It is pertinent to note here that under the Ordinance the power to make the rules has been conferred on the Federal Government and not the authority which has been conferred the power to make regulations with B prior approval of the Federal Government not inconsistent with the provisions of the Ordinance or the rules. Thus, the only power vested in the authority is to frame the regulations which have to be in consonance with the provision in the Ordinance and the rules framed under section 26. Thus, the authority has not even the power of framing the rules. By no stretch of imagination it can be held to be vested with the jurisdiction to control the export and import to and from the zone. So far, Rule 11 of the Export Processing Zones Authority Rules, 1981, framed by the Federal Government is concerned, it pertains to the dealings in foreign exchange. The entire Rule 11 is reproduced below:-

"(11). Dealings in foreign exchange, etc.---(1) The Bank may issue licences to the branches for transacting foreign exchange business in the Zones.

(2) The rules applicable to the import into, and export from, Pakistan of Pakistani currency shall apply to the import into, and export from, the zones to the tariff area.

(3) Foreign currency notes and other foreign currency.

(4) All imports into the Zones shall be paid for out of the importers own foreign exchange resources abroad without involving, either directly or indirectly, Pakistan resources.

(5) Imports into the Zones from the tariff area shall be deemed to be exports from Pakistan and imports into the tariff area from the zone shall be deemed to be imports from abroad and shall be subject to the same conditions and restrictions as are applicable to similar imports from abroad."

16. The provisions contained in sub-rule (5) of Rule 11 cannot be read in isolation as it would be against the principles of interpretation of statute to the effect that no provision is to be read in isolation and entire scheme is to be kept in view while interpreting a particular provision and further that the expressions and provisions take their colour and C complexion from the context in which they are used. When sub-rule (5) of Rule 11 is read in conjunction with other sub-rules of Rule 11, we find that it is in respect of matters relating to foreign exchange. The entire scheme in this behalf is that the branches of the Banks which have been issued licences by the State Bank of Pakistan, shall while dealing with the foreign exchange keep in view the rules applicable to the import into, and export from, Pakistan. Under sub-rule (4), all imports into the Zones shall be paid for out of the importers own foreign exchange resources abroad without involving, either directly or indirectly, Pakistan resources and in the same context sub-rule (5) provides that imports into zones from the tariff area shall be deemed to be export from Pakistan and imports into the tariff area from the zones shall be deemed to be imports from abroad and shall be subject to the same conditions and restrictions as are applicable to similar imports from aboard. This rule framed by the federal Government no where provides that the Export Processing Zones Authority, is empowered to control import and export or an Act of Parliament shall be overruled by these rules. It needs no emphasis that rules are in the category of subordinate legislation and a subordinate legislation can never have overriding effect on an Act of D Parliament. There is no non obstante clause in the entire Export Processing Zones Authority Ordinance, 1980 as well as the rules framed thereunder. There is only one law in Pakistan pertaining to the control of Import and Export which is the Import and Export (Control) Act, 1950, empowering the Federal Government to prohibit, restrict or otherwise control the import and export of goods of any specified description or regulate generally all practices (including trade practices) and procedure connected with the import or export of such goods. It further provides that all goods to which any order under subsection (1) applies shall be deemed to be goods of which the import or export has been prohibited or restricted under section 16 of the Customs Act, 1969 and all the provisions of that Act shall have effect accordingly. For the sake of convenience section 3 of the Imports and Exports (Control) Act, 1950, is reproduced below:--

"3 (1) The Federal Government may, by order published in the official Gazette and subject to such conditions and exceptions as may be made by or under the order, prohibit, restrict of otherwise control the import or export of goods of any specified description, or regulate generally all practices (including trade practices) and procedure connected with the import or export of such goods, and such order may provide for applications for licences under this Act, the evidence to be attached to such application, the grant, use, transfer, sale or cancellation of such licences, and the form and manner in which and the periods within which appeals and applications for review or revision may be preferred and disposed of and the charging of fees in respect of any such matter as may be provided in such order.

(2) No goods of the specified description shall be imported or exported except in accordance with the conditions of a licence to be issued by the Chief Controller or any other officer authorised in this behalf by the Federal Government.

(3) All goods to which any order under section 1 applies shall be deemed to be goods of which the import or export has been prohibited or restricted under section 16 of the Customs Act, 1969 and all the provisions of that Act shall have effect accordingly.

(4) Notwithstanding anything contained in the aforesaid Act the Federal Government may, by order published in the official Gazette, prohibit, restrict or impose conditions on the clearance whether for home consumption or warehousing or shipment abroad of any imported goods or class of goods."

17. Keeping above provisions in view, it has been held by a Division Bench of this Court in the case of Messrs Sikandar and Brothers v. Government of Pakistan PLD 1986 Kar. 373, that goods prohibited under section 3 of the Import and Export (Control) Act, shall also be deemed prohibited and restricted under section 16 of the Customs Act and whole Customs Act, shall apply. Relevant findings read as follows:

"(24) It may further be noticed that subsection (1) of section 3 of the Imports and Exports (Control) Act, 1950 provides that the Federal Government may, by order, published in the official Gazette, and subject to such conditions and exceptions as may be made by or under the order, prohibit, restrict or otherwise control the import or export of goods of any specified description, or regulate generally all practices (including trade practices) and procedure connected with the import or export of such goods. Subsection (2) of this section prohibits the import or export of goods, except in accordance with the conditions of a licence to be issued by the Chief Controller, or any other officer authorized in this behalf by the Federal Government. Sub-section. (3) enacts that all goods to which any order under subsection (1) applies, shall be deemed to be goods of which the import or export has been prohibited and restricted under section 16 of the Customs Act and all the provisions of that Act shall have effect."

18. In the judgment of Peshawar High Court Rule 6 of the Customs Export Processing Zones Rules, 1981, has been referred. However, the aspect as to who has framed these rules and under what authority, has not been adverted to. A perusal of these rules shows that they have been framed by the Central Board of Revenue in exercise of the powers conferred by section 219 of the Customs Act, 1969. Rule 6 of these rules has been produced in the earlier part of this judgment. A perusal whereof shows that the goods produced by investors in a zone to tariff area for home consumption may be allowed subject to import restrictions and the E goods may be taken out of the zone after fulfilling all the requirements prescribed under the Act and the rules made thereunder for the direct import from abroad into the tariff area. It would be advantageous to refer Rule 5 of the Customs Export Processing Zones Rules, 1981 as well, which provides that any goods removed from a Zone for exportation shall be exported under the export procedure as laid down in the Act and the rules made thereunder. The expression `Act' used in these rules mean the Customs Act, 1969, as defined in Rule 2 thereof, neither any provision contained in these rules have been assailed before this Court nor before Peshawar High Court. By virtue of the provisions contained in section 3(3) of the Import and Export (Control) Act, 1950 read with section 16 of the Customs Act, 1969, the Federal Government is empowered to prohibit or restrict the bringing into and out of Pakistan of any goods of specified description by air, sea or land. On account of these provisions, the Customs Rules, 2001 contain provisions in Chapter XII with the caption Export. Sub-chapter (C) specifying deals with Export Processing Zone. Neither before this Court nor before Peshawar High Court these rules which spread from Rules 225 to 236 have been assailed at any time from the year, 2001, when these rules framed, uphill now. It is not shown as to how an amendment in Rule 228 of the Customs Rules, 2001 by S.R.O. 461(I)/2004, dated 12-6-12004 can be assailed when the rules pertaining to Export Processing Zones have not been assailed at any time. Our learned brothers of the Peshawar High Court have referred to Rule 24-A of the Export Processing Zones Authority Rules, 1981, with the observation that any change in the incentive package under which investments have been sanctioned in Zone shall not be made except where such change is more advantageous to the investor and is also accepted by him. However, the contents of incentive package if any in favour of petitioners in the Peshawar High Court, or in favour of petitioners before us have riot been produced and it has not been shown as to what were the contents of alleged incentive package if any and how the restrictions placed in the two S.R.Os. validity whereof is assailed as disadvantageous to the petitioners, vis-a-vis the alleged incentive package. We would further like to observe that if in any case there is any incentive package in favour of a particular investor then any change in the said incentive package under which an investment has been sanctioned in a zone shall not be made except where such change is more advantageous to the investor and for that purpose any particular person affected by any change is required to show that the change has affected his vested rights and is less advantageous. Nothing of the sort has been produced either before Peshawar High Court or before this Court. We would further like to clarify that if there is any change which has adversely affected any investor vis-a-vis a particular incentive package then to that extent the change shall be inoperative in respect of that particular investor only and it shall not make any rule or notification in this behalf to be invalid. We further find that in Para. 13 of the judgment of Peshawar High Court Rule 11(5) of the Export Processing Zones Authority Rules, 1981, has been referred as section 11(5) of the Ordinance. This appears to be an inadvertent mistake. However, it has certainly affected the decision because the impugned S.R.Os. have been held to be violative of a provision contained in the Export Processing Zones Authority Ordinance, 1980, which is factually incorrect.

19. At this stage we would further like to clarify that even if one subordinate legislation is repugnant to other subordinate legislation it will not make either of them to be invalid. In order to make a sub-ordinate legislation to be invalid it has to be shown that either it is beyond the jurisdiction of the authority exercising power of delegated legislation or it is violative of the provisions of the Act of Parliament or is repugnant to any provision of the Constitution.

20. A perusal of the judgment of the Peshawar High Court further shows that a question was formulated to the effect whether the activity of import into a Tariff area and Export from the Zone can be subjected to any restriction by the general law of the land? The question was answered as follows:

"The Government of its own cannot specify the extent and manner of the goods to be exported from the Zone into tariff areas notwithstanding the provisions contained in section 3 of the Import and Export (Control) Act, 1950 which deals with the imports and exports in general. While the Ordinance in general and the rules made there under in particular deal with a different situation altogether inasmuch as they by virtue of the deeming clause, deem incoming goods into the Zones and outgoing goods there from to the tariff areas as export and import respectively. Therefore, we do not think, that the provisions of the Act of 1950 can be imported into the Ordinance, which provides its own mode, method and mechanism for regulating exports. Rule 6 of S.R.O. No. 249(1)/81, Islamabad, dated 25-3-1981 also does not limit or reduce the power of the authority in specifying the manner and extent of the materials and goods to be exported except emphasising the levy of the taxes and duties if and when export or import under the Ordinance takes place."

21. We are of the opinion that this question was framed on account of the fact that import of goods. into the Zone either from abroad or tariff area meaning thereby any area in Pakistan, outside the limit of a Zone has been treated as import from abroad and likewise export from Zone to tariff area has been deemed to be export outside Pakistan. The Legislature, is empowered to enact deeming provisions, meaning thereby to give a particular meaning and connotation by fiction of law, which in fact does not exist. Such deeming provisions by' fiction of law are to be treated at par with actual acts for all intents and purposes and the deeming provisions are to be taken to their logical conclusions. While taking the deeming provisions to their logical conclusion the vision is not to be marred or blurred. Thus, once under a deeming provision the import into Zone and export out of Zone is treated by the legislature as import in Pakistan and export outside Pakistan respectively, then in the absence of any special provisions it shall be treated that such imports and exports are actual imports and exports and all the provisions of the law relating to export and import shall become applicable. We have not been able to find out any law excluding the general law dealing with the import and export and control thereof. So far S.R.O. 249(I)/81, dated 25-3-1981, is concerned, it contains Customs Export Processing Zones, Rules, 1981. These rules have not been framed by the Export Processing Zones Authority under the Ordinance. As already observed in fact the authority has no power to frame rules under the Ordinance. Section 26 of the Ordinance empowers Federal Government to frame Rules and the Federal Government has framed the Export Processing Zones Authority Rules, 1981. S.R.O. No. 249(1)/81 has been issued by C.B.R., therefore, Rule 6 thereof rightly deals with levy of Taxes and duties only if and when export or import under the Ordinance takes place. Thus, H S.R.O. 634(I)/2004, dated 22-7-2004 issued by the Federal Government in exercise of powers conferred by subsection (1) of section 3 of the Import and Export (Control) Act, 1950, in the form of Import Policy Ordinance, 2004, is a valid piece of delegated legislation. Para. 13 of the Import Policy Ordinance, 2004, which reads as follows, is not open to any exception:---

"(13) Imports into export processing zones,-

(1) The units operating in export processing zones may import goods from abroad as well as from the tariff area in accordance with the rules and procedure prescribed under the Customs Export Processing Zone Rules, 1981.

(2) Units operating in the export processing zones may sell defective goods, wastes, used packing materials, empty drums and cartons, to the tariff area subject to the condition that the total value of such sales during an year does not exceed 3 per cent of their FOB exports. Besides, such sales will be subject to payment of normal duties and taxes.

(3) The warehouses established in the export processing zones may sell only such imported raw materials to the tariff area, as may be specified by the Federal Government by notification in the official Gazette from time to time.

(4) Plant and machinery imported for export processing zones or already installed therein will be allowed to be sold or shifted to tariff area by approval of Export Processing Zone Authority irrespective of whether the machinery is old or new and whether it has remained installed in Export Processing Zones for any period provided its import is otherwise permissible into tariff area under the import policy.

(5) The units established in the export processing zones shall export only up to twenty per cent of their total production to tariff areas in Pakistan while eighty per cent shall be exported to foreign countries.

22. By virtue of the provisions contained in section 16 of the Customs Act, 1969 read with section 3(3) of the Import and Export (Control) Act, 1950 the C.B.R. is empowered to frame the rules in exercise of powers under section 219 of the Customs Act and therefore, it is held that S.R.O. 461(I)/2004, dated 12-6-2004 amending various rules in the Customs Rules, 2001 including the addition of sub-rule(4) in Rule 228 is in accordance with the law and is not open to any exception.

23. For the foregoing reasons, we do not agree with the view of Hon'ble Judges of the Peshawar High Court holding the two impugned notifications as invalid in the judgment, dated 4-10-2005 (Writ Petition No.1644 of 2004, Major (R) Hussain Haider v. Pakistan).

24. After hearing learned counsel for the petitioner, the petition was dismissed in limine on 15-2-2006, by a short order. These are the detailed reasons in support thereof.

Petition dismissed.

M.H./M-32/K????????????????????????????????????????????????????????????????????????????????????? Petition dismissed.