IN THE HIGH COURT OF SINDH, KARACHI
Suits No.302, 303, 338, 365, 366, 369, 371, 373, 381, 383, 395,
398, 410, 418, 419, 436, 469, 480, 489 and 490 of 2017
FatimaFert Limited & others in their respective suits
Federation of Pakistan & others
Order with signature of Judge
Date of hearing: 23.02.2017
Mr. Ali Almani Advocate.
Mr. Ameen M. Bandukda Advocate
Mr. Ijaz Ahmed Advocate.
Mr. Jehanzeb Awan a/w Mr. Jawwad A. Qureshi Advocates.
Mr. Shahzad Nizam Advocate.
Mr. Ravi Pinjani a/w S. Maqbool Shah Advocate.
Ms. Samia Durrani a/w Mr. Faiz Durrani Advocates.
Mr. Anas Makhdoom a/w Ahmed Farhaj Advocates.
Mr. Hafiz Muhammad Azhar Ali Advocate.
Mr. Sajid Rasool Advocate.
Mr. Salman Talibuddin, Addl. Attorney General along with Mr. Abdul Qadir Leghari, Assistant Attorney General, and Ms. Alizeh Bashir Advocate and Mr. Muhammad Nazir Malik, Director (Law) Ministry of Petroleum & Natural Resources.
Mr. Asim Iqbal along with Mr. Farmanullah Khan Advocate.
Mr. Farooq, Sr. Admn. Asstt. OGDCL.
Mohammad Shafi Siddiqui, J.- By this order I intend to dispose of the injunction applications under order XXXIX rule 1 and 2 CPC filed in the subject suits seeking to restrain the defendants from claiming the arrears as well as future Gas Infrastructure Development Cess (GIDC), which is subject matter of these suits.
The subject matter of these suits is the claim of Gas Infrastructure Development Cess (GIDC), which is otherwise declared to be ultra vires in terms of common judgment dated 26.10.2016 passed in several suits mentioned in the title of the aforesaid judgment including Suit No.1009 of 2015. The present set of suits include plaintiffs who are decree holders in terms of the above referred judgment as well as those who have opted to challenge such Gas Infrastructure Development Cess for the first time. As against the judgments and decrees in the earlier suits, the Federation of Pakistan opted to challenge in one suit the aforesaid judgment and decree i.e. in Suit No.1009 of 2015 by way of High Court Appeal No.361 of 2016 wherein by order dated 10.11.2016 the operation of the impugned judgment and decree has been suspended. Subsequently, learned Division Bench vide order dated 03.02.2017 modified the interim order that the arrears of Gas Infrastructure Development Cess shall not be recovered. Some of the consumers have received the bills including claim of arrears of Gas Infrastructure Development Cess as well as future cess which is challenged by the plaintiffs in these suits.
Learned counsels for plaintiffs at the very outset relied upon the pleadings of the High Court Appeal itself, copy of which is separately provided by learned Addl. Attorney General. They contended that Federation of Pakistan has specifically challenged the judgment and decree in Suit No.1009 of 2015 only and has also agitated that no decree has been prepared till filing of the appeal and passing of the ad-interim order on 10.11.2016. It is claimed that suits which were pending may have been clubbed together but it is the individual’s right which was dealt with by a common judgment. The individual right may be common but it is dealt with separately by an independent judgment which is deemed to be passed in all suits which were heard. He further submitted that without filing separate appeals and/or impleading other plaintiffs in the appeal, wherein ad-interim order was obtained, the rights available to them (plaintiffs) under a decree cannot be taken away. Without prejudice, he submitted that if at all the rights of all the consumers/plaintiffs are at stake in the aforesaid appeal, notices ought to have been issued to all the consumers/plaintiffs, subject to permission under the law.
Learned Addl. Attorney General on the other hand submitted that since operation of the impugned judgment and decree was suspended by learned Division Bench therefore it would operate as a judgment in rem since all the suits were clubbed together and a common judgment was passed in all suits. It is argued that none of the plaintiffs could distinguish their case from that of plaintiff in Suit No.1009 of 2015 in relation to which appeal was filed. It is contended that when the ad-interim order in Suit No.1009 of 2015 was passed it operated as an order in personam but once these suits are clubbed together it become a common point for all the consumers and/or plaintiffs and hence the suspension of the judgment and decree in one suit in High Court Appeal deemed to operate as a judgment in rem rather than in personam.
Learned Addl. A.G., without prejudiced to the above, also submitted that the consumers/plaintiffs herein are at liberty to move appropriate application to become a party in the pending appeal to which he has no objection.
I have heard the learned counsel and perused the material available be on record.
It has been a settled principle laid down by this Court as well as by the Hon’ble Supreme Court that ad-interim order passed could only operate in personum and not in rem. Each of the plaintiffs in the earlier bunch have exercised their rights in individual capacity, though their suits were clubbed together as the grievance raised by them was a common subject hence it is to be dealt with separately. Disposal of suits by any common judgment is deemed to be passed in all suits which were heard. It is the convenience of Court that these cases were clubbed together; each case was not heard separately. Without such recourse of filing appeal, the ad-interim order obtained in one High Court Appeal with reference to a particular suit cannot be deemed to operate in rem and the rights available to these plaintiffs under decree cannot be taken away, under the garb of the order passed in High Court Appeal. If at all the rights of all the consumers/plaintiffs are at stake as stated by learned Addl. Attorney General notices ought to have been issued to all the consumers/plaintiffs in separate appeals. The explanation of the learned Addl. Attorney General that they may become party in the appeal, is an inconceivable argument in view the fact that aggrieved of the judgment and decree of this Court Federation of Pakistan opted to file appeal only in one suit whereas plaintiffs have impleaded Federation of Pakistan in all suits and never raised this argument in their suit that Federation may apply to become a party.
The concerned ministry of Petroleum & Natural Resources while issuing letter to the Managing Director of SNGPL erred in recommending the recovery of Gas Infrastructure Development Cess (GIDC) in the current bills along with arrears and future cess from the consumers despite interim order passed by this Court and judgment and decree passed on the impugned demand of Gas Infrastructure Development Cess (GIDC). Reliance on High Court Appeal No.361 of 2016 could only be made in Suit No.1009 of 2015 as it operates as judgment in personem rather than in rem.
It is also pertinent to note that the appeal filed by Federation of Pakistan, referred above, itself is specific to one suit only. For the convenience sake prayer of the High Court Appeal is reproduced as under:-
“In view of the above facts and grounds, it is respectfully prayed on behalf of the appellant above named that this Hon’ble Court may be pleased to admit this appeal, call for the record of Suit No.1009 of 2015, suspend the operation of the impugned judgment and decree until the disposal of the appeal and, after hearing the parties hereto, allow this Appeal and set aside the Impugned Judgment and Decree.”
Similarly, the prayer of interlocutory application filed in the above appeal also confine to the one suit, which is reproduced as under:-
“It is most respectfully prayed on behalf of the appellant above named that for the reasons set out in the accompanying affidavit this Hon’ble Court may be pleased to suspend the operation of the impugned judgment dated 26 October 2016 passed by the learned Single Bench of this Hon’ble Court in Suit No.1009 of 2015.”
In the case of Maj. Gen. (Retd.) Mian Ghulam Jilani v. The Federal Government (PLD 1975 Lahore 65 it has been observed as under:-
“3. ……We have not the slightest doubt in our mind that any law declared by the Supreme Court is binding on all other Courts in Pakistan and all executive and judicial authorities throughout the country are to act in aid of the Supreme Court. Apart from the Constitutional obligation imposed upon us, even the propriety demands that we must follow such a law without any hesitation. However, the question which arises for consideration is whether the order of the Supreme Court suspending the operation of the impugned order of the High Court while granting special leave to appeal, is such a. decision which is contemplated under Article 189 of the Constitution. ….
4. ….In this view of the matter, this order suspending the operation of the impugned order is not covered by Article 189 of the Constitution and consequently is not binding on the Courts in Pakistan, except of course on the parties in that case.”
In the case of Colony Textile Mills Ltd. v. Federal Government (2005 PTD 911) it has been held by this Court as under:-
“It is an established law that one Division Bench of a High Court is bound by the judgment of another Division Bench passed by the same Court and that the judgment of a High Court is good law until it is reversed by the Hon’ble Supreme Court of Pakistan. The copy of CPLA No. 97-K of 2000 produced by Mr. Raja Iqbal does not show that the judgment of this Court in C.P. No. D-1582 of 1999 has been reversed. Accordingly, this petition is allowed and it is held that petitioner is entitled to the benefit of S.R.O. 454(I)/96, dated 13-6-1996 and is not liable to pay Central Excise Duty under S.R.O. Nil(I)/99, dated 16-9-1999.”
In another judgment in the case of Meeran Bibi v. Manager, Zarai Taraqiati Bank Ltd. (2012 CLD 2029) learned Single Judge of Lahore High Court has held that:-
“….That is a declaratory judgment with respect to the validity of a law and therefore, its effect operates in rem. Learned counsel informs that the Hon'ble Supreme Court has in one CPLA suspended the judgment of the learned Full Bench. However, that suspensory order is claimed to have effect inter parties only and not as a judgment in rem. Such an effect is established by the rule laid down in Gen. (Retd.) Ghulam Jilani v. The Federal Government through the Secretary, Government of Pakistan, Interior Division, Islamabad (PLD 1975 Lahore 65).”
In the case of Amin Fabrics Ltd. v. Commissioner, Aiwan-e-Mehnatkash (1998 PLC [CS] 694) it has been reported as under:-
“….With all the humility at my command, I would state that the said leave granting order is not binding in nature till the final conclusion of the matter by the Supreme Court of Pakistan. At best binding force of such interim stay order could only extend to the parties to the proceedings before the Supreme Court of Pakistan.”
In the case of Yousaf A. Mitha v. Aboo Baker (PLD 1980 Karachi 492) it has been held that:-
“15. I am, therefore, of the view that even if stay has been granted by the Supreme Court, unless the D.B. decision of this Court (reported in PLD 1975 Karachi 944) is set aside by the Supreme Court, the law laid down therein is binding on me apart from the fact that the stay granted will apply inter parties in that matter only.”
In the case of Ejaz Rasool v. Member National Industrial (2014 PLC 288) it has been held that:-
“16. The dictums laid down by the Hon'ble Supreme Court of Pakistan show that "judgment in rem is a different from the judgment in personam". A judgment in rem is a judgment against a thing as contradistinguished from a judgment against a person or a judgment whereby a status is determined. A judgment in rem is an adjudication pronounced upon the status of some particular subject-matter by a Tribunal/Court having competent authority for that purpose. It differs from a judgment in personam as this judgment is in form as well as substance between the parties claiming the right, and that it is so inter parties appears by the record itself. A judgment in rem is founded on a proceeding instituted, not against the person as such, but against or upon the thing or subject-matter itself whose state or condition is to be determined. It is a proceeding to determine the state or condition of the thing itself, and the judgment is solemn declaration of the status of the thing, and it ipso facto renders it what it declares it to be.”
Thus, it is unanimous view that an order of suspension of the operation of the judgment and decree or leave granting order would not operate to have a binding effect on other parties; it could operate inter parties since the operation of the judgment and decree was suspended in a particular suit/appeal with reference to particular party.
In view of above facts and circumstances, I am of the view that unless the judgment and decree passed in all suits which were clubbed together and were disposed of vide common judgment and decree, is challenged and set aside in each and every suit it would remain binding against all the defendants/distributors.
In view of the above the injunction applications in all these suits are granted and the defendants are restrained from recovering either arrears or future Gas Infrastructure Development Cess (GIDC) from the plaintiffs who have judgments and decrees in their favour against which no appeal is filed. However, in those suits where GIDC has been challenged for the first time, the respective interim orders already passed are confirmed till final disposal of their suits.
Dated: 03.03.2017 Judge