Policy Decision Concerning Setting Up New Sugar Mills in Punjab

Policy Decision Concerning Setting Up New Sugar Mills in Punjab Alternate Remedy Case Laws Civil Law Constitutional Law Freedom of Trade - Business Industrials Knowledge - Civil Law Knowledge - Constitutional Law Litigation & Arbitration Maintainability Mala fides Policy Decision Public Interest Solutions - Civil Law Solutions - Constitutional Law Supreme Court Mr. Justice Qazi Faez Isa in his judgment has decided the issue of policy decision concerning setting up new sugar mills in Punjab and/or expanding the existing ones in Civil Appeals No. 1242 of 2013 etc.

1. Through a common judgment dated 26th February 2013 of the Lahore High Court at Lahore a number of writ petitions were dismissed including those filed by the appellants herein. This Court through the following order granted leave to appeal against the impugned judgment:

“Leave is granted to consider the scope of the provisions of Sections 3 and 11 of the Punjab Industries (Control on Establishment & Enlargement) Ordinance, 1963 (the Ordinance, 1963); whether the government has any power under the aforesaid provisions of law to impose a ban upon the establishment/enlargement of sugar industry as has been done by notification dated 6th December, 2006 and in this context the application of the petitioner has been dismissed by the Secretary, Government of Punjab, Industries Department on 24.1.2011; the correctness of the law enunciated in the judgment reported as Madina Sugar Mills Vs. Secretary, Ministry of Industries and others (PLD 2001 Lahore 506) and the effect of the judgment reported as Arshad Mehmood and others Vs. Government of Punjab through Secretary, Transport Civil Secretariat, Lahore and others (PLD 2005 SC 193) upon the facts of this case in relation to the Ordinance, 1963.”

It may however be clarified that The Punjab Industries (Control on Establishment and Enlargement), Ordinance, 1963 was promulgated by the Governor of West Pakistan on 25th January 1963 and was approved by the Provincial Assembly of West Pakistan with amendments on 27th March 1963 and after receiving the assent of the Governor was published in the West Pakistan Gazette (Extra Ordinary) dated 27th March 1963 at pages 1269-1272 as The Punjab Industries (Control on Establishment and Enlargement), Act, 1963. Notices were also issued to the Attorney General for Pakistan and the Advocate General of Punjab under Order XXVII-A of the Code of Civil Procedure.

2. Khawaja Muhammad Farooq, the learned senior counsel representing the appellants in C.A. Nos. 1242 and 1244 of 2013, Mr. Noor Muhammad Chandia, the learned senior counsel representing the appellant in C.A. No. 1243 of 2013 and Mr. Haq Nawaz Chattha, the learned counsel representing the appellant in C.A. No. 1245/2013, have assailed the judgment of the High Court. They stated that the appellants had challenged the Notification dated 6th December 2006 (“the impugned Notification”) issued by the Industries Department of the Government of Punjab, which had imposed a complete ban on the setting up of new sugar mills and enlarging the installed capacity of existing sugar mills in the Province of Punjab. This was done by inserting a new clause 3 in the earlier Notification dated 17th September 2002. The learned counsel stated that though the impugned Notification was issued under section 11 read with section 3 of the Punjab Industries (Control on Establishment and Enlargement), Act, 1963 (“the Act”) neither of these sections of the Act, or for that matter any other section, envisaged such a ban therefore the same was ultra vires of the Act and of no legal effect. It was next contended that an application, seeking permission to establish or expand an industrial undertaking, should be dealt with under section 3 of the Act and can only be rejected after first giving a person an opportunity of showing cause against it or if the grant of the permission is prejudicial to the national interest or it is either injurious to health or could be a source of nuisance for the residents of the local area in which the industrial undertaking is proposed to be set up or expanded and not by simply referring to the impugned Notification.

3. Mr. Noor Muhammad Khan, the learned counsel for the appellant in C.A. No. 1243 of 2013, added to the above contentions by stating that his client had placed reliance upon the Notification dated 15th July 2005, which had permitted the establishment of new sugar mills up to a capacity of 16,000 TCD (tons crushing per day), consequently, the appellant-company was set up to establish a sugar mill with a capacity of 8,000 TCD and it had purchased 255 kanals of land, had applied to a financial institution for provision of finances, and made payment of an amount of two hundred thousand rupees to the financial institution as processing fee. He also referred to the earlier Writ Petition No. 8473/2007 filed by the appellant-company before the Lahore High Court which was dismissed vide order dated 16th April 2008, by holding that the appellant had, “an alternate remedy of filing an appeal before the competent authority”. The order of the High Court was impugned in Intra Court Appeal No. 130/2008 which was disposed of vide order dated 26th May 2008, the operative part whereof is reproduced here under:

“2. Having examined the writ petition file and the impugned judgment, we find that the original order i.e. dated 27.8.2007 (Annex-B to the writ petition) is subject to a revision or an appeal under section 7 of the Punjab Industries (Control on Establishment and Enlargement) Ordinance, 1963. The learned counsel was confronted accordingly. He has tried to argue that the order does not fall under section 3 of [sic] section 4 of the said Ordinance.

3. Upon our query, the learned counsel has frankly conceded that the said impugned order has the effect of stopping or obstructing of the Industrial Project proposed to be installed by the appellant. This being so, the matter squarely falls under section 3 of the said Ordinance which is subject to a revision under the said section 7. Needless to state that section 3 of the Law Reforms Ordinance, 1972, lays down that the instant ICA would not be competent where the law under which the original order has been passed provides that, inter alia, a revision against the same. The ICA is not competent and is accordingly disposed of.”

The appellant aggrieved by the above orders approached this Court in Civil Appeal No. 310-L/2011 which was disposed of vide order dated 30th January 2012, reproduced here under:

“According to the learned counsel for the appellant the notification dated 6.12.2006, on the subject, has also been challenged by the appellant in another writ petition which is still pending before the High Court.

2. In this view of the matter, we are of the opinion that the adjudication of the question involved in this matter is only of academic nature and the adjudication of the substantive notification dated 6.12.2006, is pending in the High Court, this appeal is dismissed.

3. The decision in the writ petition shall not be prejudiced by any finding of the instant appeal.”

4. Mr. Mudassar Khalid Abbasi, the learned Assistant Advocate General of the Government of Punjab (hereinafter “AAG” and “Government” respectively), stated that none of the appellants had availed of the alternate remedy of filing a revision or an appeal under section 7 of the Act therefore the writ petition was not maintainable before the High Court in terms of clause (1) of Article 199 of the Constitution of the Islamic Republic of Pakistan (“the Constitution”).

Further information regarding setting up new sugar mills in Punjab and/or expanding the existing ones can be solicited from AUJ LAWYERS. Feel free to contact us in case you need any clarification and/or require legal assistance regarding similar matters.