IN THE SUPREME COURT OF PAKISTAN 
(APPELLATE JURISDICTION) 
 
PRESENT: 
MR. JUSTICE MUSHIR ALAM 
MR. JUSTICE FAISAL ARAB 
MR. JUSTICE SYED MANSOOR ALI SHAH 
 
CIVIL APPEALS NO.1113 TO 1155 OF 2017 AND CIVIL 
PETITIONS NO.3124, 387-P, 389-P, 392-P, 393-P, 394-P, 399-P, 
400-P, 3027, 3028, 3029, 3030, 3138, 3241, 3259, 3260, 3327 
AND 3411 OF 2017 AND 3385 OF 2018 
(On appeal against the judgments dated 31.05.2017, 28.5.2019, 9.8.2017, 18.8.2017, 21.8.2017, 
11.6.2015 passed by the Peshawar High Court, Peshawar in Writ Petition Nos. 2178-P/2015 & 2729 
to 2731, 3056, 3057, 3058, 3081, 3082, 3109, 3110, 3111, 3112, 3113, 3118, 3137, 3157, 3216, 
3268, 3297, 3413, 3489, 3890 of 2014, 542, 858, 885, 2160 to 2166, 2179 to 2182, 2164 to 2166, 
2179 to 2198, 2210 to 2233, 2254, 2263 to 2265, 2287 to 2290, 2305, 2307, 2308, 2329, 2373, 
2466 to 2468, 2533, 2556, 2558. 2575, 2576, 2589 to 2591, 2593, 2606, 2607, 2608, 2723, 2820, 
2852, 2870, 3133, 3163, 3496, 3881, 3915, 3974, 4074, 4522 of 2015, 19, 165, 1415, 1757, 3569, 
3849 of 2016, 1601, 1650, 1849, 3270-P, 33104-P, 3302-P, 2843-P of 2017, 2293-P, 778-A, 2232-P 
to 2234-P, 2427-P to 2429-P, 2472-P, 2938-P, 2939-P, 2940-P, 4300-P of 2016, 589-P, 2408-P of 
2017, 3085-P/2014) 
 
AND 
 
CIVIL MISC. APPLICATIONS NO. 20, 86, 812, 813, 814, 815, 
1022, 2014 OF 2020 AND 8277, 8278, 8279, 3076, 9149, 9186, 
9301, 9305, 9521, 9746, 9844, 10608 OF 2019 AND 8497 OF 
2018 AND 5307 & 9153 OF 2017 
(Applications for Impleadment) 
 
AND  
 
CIVIL MISC. APPLICATIONS NO.5295, 5511, 5635, 5637, 5639, 
5641, 5643, 5645, 5647, 5649, 5651, 5678 TO 5686, 5689 TO 
5696, 5699, 5701, 5703, 5705, 5707, 5709, 5711, 5713 AND 
5715 TO 5721 OF 2017 
(Applications for Stay) 
 
Sr. 
No.  
 Party Names 
 Case No.  
1. 
 M/s Khurshid Soap & Chemical 
Industries (Pvt.) Ltd represented 
through Mr. Sheikh Muhammad 
Ilyas, KPK  
Versus 
(1) Federation of Pakistan through 
M/o 
Petroleum 
& 
Natural 
Resources etc 
 
 CA 1113/2017 in 
CP 2687/2017 
 
&  
 
CMA 5295/2017 
 
  
2. 
 Ghani Glass Limited through Mr. 
Zakir Mian, Manager Legal 
Versus 
(1) Federation of Pakistan through 
M/o Petroleum, Islamabad etc 
 
 
 CA 1114/2017 in 
CP 2786/2017 
& 
CMA 5511/2017 
  
 
3. 
 AJ Textile Mills Limited through 
its Authorized Director  
Versus 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc. 
 
 CA 1115/2017 in 
CP 2898/2017 
& 
CMA 5635/2017 
 
  
 
4. 
 AJ Textile Mills Limited through  CA 1116/2017 in 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 2 :-
its Authorized Director  
 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
CP 2899/2017  
& 
CMA 5637/2017 
 
  
 
5. 
 (1) Saif Textile Mills Ltd, Peshawar 
etc. 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1117/2017 in 
CP 2900/2017 
& 
CMA 5639/2017 
 
  
6. 
 (1) Saif Textile Mills Ltd, Peshawar 
 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad 
 
 CA 1118/2017 in 
CP 2901/2017 
& 
CMA 5641/2017 
 
  
7. 
 Sarhad 
Textile 
Mills 
Ltd, 
Peshawar  
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1119/2017 in 
CP 2902/2017 
& 
CMA 5643/2017 
 
  
8. 
 (1) Rahman Cotton Mills Ltd, 
Mardan etc 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad 
 
 CA 1120/2017 in 
CP 2903/2017 
& 
CMA 5645/2017 
 
  
9. 
 Sarhad 
Textile 
Mills 
Ltd, 
Peshawar  
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1121/2017 in 
CP 2904/2017 
& 
CMA 5647/2017 
 
   
10. 
 M/s Babri Cotton Mills Ltd, Kohat 
 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad 
 
 CA 1122/2017 in 
CP 2905/2017 
& 
CMA 5649/2017 
 
  
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 3 :-
11. 
 M/s Bannu Wollen Mills Ltd, 
Peshwar 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1123/2017 in 
CP 2906/2017 
& 
CMA 5651/2017 
 
  
12. 
 M/s Ashraf Industries Pvt Ltd, 
Peshawar 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1124/2017 in 
CP 2926/2017 
& 
CMA 5678/2017 
 
  
 
13. 
 M/s Ashraf Industries Pvt Ltd, 
Peshawar 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1125/2017 in 
CP 2927/2017 
& 
CMA 5679/2017 
 
  
 
14. 
 M/s Khyber Tubaco Co. Ltd, 
Mardan 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1126/2017 in 
CP 2928/2017 
& 
CMA 5680/2017 
 
  
15. 
 M/s Hussnain Daud Oil & Ghee 
Mills Ltd, Peshawar 
 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 
 CA 1127/2017 in 
CP 2929/2017 
& 
CMA 5681/2017 
 
  
 
16. 
 Royal Textile Mills Limited, Swabi 
 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1128/2017 in 
CP 2930/2017 
& 
CMA 5682/2017 
 
  
17. 
 Swat Tyre & Rubber Co. Pvt Ltd, 
Peshawar 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
 CA 1129/2017 in 
CP 2931/2017 
& 
CMA 5683/2017 
 
  
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 4 :-
Resources, Islamabad etc 
 
18. 
 (1) M/s Khyber Electric Lamps 
Manufacturing Co. Ltd etc 
 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1130/2017 in 
CP 2932/2017 
& 
CMA 5684/2017 
 
  
19. 
 Al Jasmin Pvt Ltd, Peshawar 
 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1131/2017 in 
CP 2933/2017 
& 
CMA 5685/2017 
 
  
20. 
 Pakistan Accumulators Pvt Ltd, 
Peshawar 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1132/2017 in 
CP 2945/2017 
& 
CMA 5686/2017 
 
  
21. 
 M/s MB Dyes Chemical & Silk 
Industry Pvt Ltd 
 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1133/2017 in 
CP 2946/2017 
& 
CMA 5689/2017 
 
  
22. 
 (1) 
M/s 
Sarhad 
Ceramics 
Industries, Mansehra etc 
 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1134/2017 in 
CP 2942/2017 
& 
CMA 5690/2017 
 
  
23. 
 Taj Enterprises Plaster of Paris, 
Peshawar 
 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1135/2017 in 
CP 2948/2017 
& 
CMA 5691/2017 
 
  
24. 
 MKB 
Enterprises 
Pvt 
Ltd, 
Peshawar 
 CA 1136/2017 in 
CP 2949/2017 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 5 :-
 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
& 
CMA 5692/2017 
 
  
25. 
 M/s 
Unisa 
Pharmaceutical 
Industries Ltd 
 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1137/2017 in 
CP 2950/2017 
& 
CMA 5693/2017 
 
  
26. 
 Frontier 
Foundry 
Pvt. 
Ltd, 
Peshawar 
 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1138/2017 in 
CP 2951/2017 
& 
CMA 5694/2017 
 
  
27. 
 TKM Enterprises, Peshawar 
 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1139/2017 in 
CP 2952/2017 
& 
CMA 5695/2017 
 
  
28. 
 M/s Deans Industries, Peshawar 
 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1140/2017 in 
CP 2953/2017 
& 
CMA 5696/2017 
 
  
29. 
 M/s Amin soap & Oil Industries 
Pvt Limited 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1141/2017 in 
CP 2954/2017 
& 
CMA 5699/2017 
 
  
 
  
  
30. 
 Brightex Industries Pvt Limited, 
Swabi 
 
Versus 
 
(1) Federation of Pakistan through 
 CA 1142/2017 in 
CP 2955/2017 
& 
CMA 5701/2017 
 
  
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 6 :-
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
31. 
 Zainab 
Textile 
Mills 
Limited, 
Haripur 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1143/2017 in 
CP 2956/2017 
& 
CMA 5703/2017 
 
  
32. 
 The 
Premier 
Sugar 
Mills 
& 
Distillery Co. Limited, Mardan 
 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1144/2017 in 
CP 2957/2017 
& 
CMA 5705/2017 
 
  
33. 
 M/s 
Associated 
Industries 
Limited, Nowshera 
 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1145/2017 in 
CP 2958/2017 
& 
CMA 5707/2017 
 
  
34. 
 Khazana Sugar Mills, Peshawar 
 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 
 
 CA 1146/2017 in 
CP 2959/2017 
& 
CMA 5709/2017 
 
  
35. 
 Swat Ceramics Company Ltd, 
Nowshera. 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1147/2017 in 
CP 2960/2017 
& 
CMA 5711/2017 
 
  
36. 
 Peshawar Chemicals, Peshawar 
 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CA 1148/2017 in 
CP 2961/2017 
& 
CMA 5713/2017 
 
 
37. 
 Peshawar 
Ceramics 
Pvt 
Ltd,  CA 1149/2017 in 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 7 :-
Peshawar 
Versus 
 
(1) 
SNGPL 
through 
its 
M.D, 
Lahore etc 
 
CP 2962/2017 
& 
CMA 5715/2017 
 
  
38. 
 (1) M/s Economic Fuels Pt Ltd, 
Peshawar etc 
 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
& 
Natural 
Resources, Islamabad etc 
 
 
 CA 1150/2017 in 
CP 2963/2017 
& 
CMA 5716/2017 
 
  
 
39. 
 (1) M/s Gas Mahal CNG Filling 
Station, Akora Khattak, District 
Nowshera etc 
 
Versus 
 
(1) Pakistan through Secretary 
Ministry of Petroleum & Natural 
Resources, Islamabad 
 
 CA 1151/2017 in 
CP 2964/2017 
& 
CMA 5717/2017 
 
  
 
40. 
 (1) M/s Khushal CNG Station, 
Pabbi etc 
Versus 
 
(1) Pakistan through Secretary 
Ministry of Petroleum & Natural 
Resources, Islamabad etc 
 
 
 CA 1152/2017 in 
CP 2965/2017 
& 
CMA 5718/2017 
 
  
41. 
 (1) 
M/s 
Orion 
Traders 
CNG 
Station No.2, Jehangira etc 
 
Versus 
 
(1) Pakistan through Secretary 
Ministry of Petroleum & Natural 
Resources, Islamabad etc 
 
 CA 1153/2017 in 
CP 2966/2017 
& 
CMA 5719/2017 
 
  
42. 
 (1) M/S Universal Gas CNG, 
Swabi etc 
 
Versus 
 
(1) Pakistan through Secretary 
Ministry of Petroleum & Natural 
Resources, Islamabad etc 
 
 
 CA 1154/2017 in 
CP 2967/2017 
& 
CMA 5720/2017 
 
  
43. 
 (1) M/s Evergreen CNG Station, 
Peshawar etc 
 CA 1155/2017 in 
CP 2968/2017 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 8 :-
Versus 
 
(1) Pakistan through Secretary, 
Ministry of Petroleum and Natural 
Resources, Islamabad etc 
 
& 
CMA 5721/2017 
 
  
44. 
 (1) Mohsin Match Factory (Pvt.) 
Ltd., Peshawar 
 
Versus 
 
(1) Pakistan through Secretary 
Ministry of Petroleum & Natural 
Resources, Islamabad etc 
 
 CP 387-P/2017 
 
  
45. 
 (1) Wadud Woolen Mills Ltd., 
Peshawar etc 
 
Versus 
 
(1) Govt. of Pakistan through 
Secretary Ministry of Petroleum & 
Natural Resources, Islamabad etc 
 
 CP 389-P/2017 
 
  
 
46. 
 (1) 
M/s 
Maclone 
Lubrication, 
Peshawar 
Versus 
 
(1) Federation of Pakistan through 
Secretary Ministry of Petroleum & 
Natural Resources, Islamabad etc 
 
 CP 392-P/2017 
 
  
47. 
 (1) M/s Bilour Industries Pvt. 
Ltd., Peshawar 
 
Versus 
 
(1) Federation of Pakistan through 
Secretary Ministry of Petroleum & 
Natural Resources, Islamabad etc 
 
 CP 394-P/2017 
 
  
48. 
 (1) M/s AGE Industries Pvt. Ltd., 
Peshawar 
Versus 
 
(1) Federation of Pakistan through 
Secretary Ministry of Petroleum & 
Natural Resources, Islamabad etc 
 
 CP 399-P/2017 
 
  
49. 
 (1) M/s Elahi Match Pvt. Ltd., 
Peshawar 
 
Versus 
 
(1) Federation of Pakistan through 
Secretary Ministry of Petroleum & 
 CP 400-P/2017 
 
  
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 9 :-
Natural Resources, Islamabad etc 
 
50. 
 (1) M/s Ejaz Poultry Protein (Pvt.) 
Ltd., Haripur 
 
Versus 
 
(1) Federation of Pakistan through 
Secretary Ministry of Petroleum & 
Natural Resources, Islamabad etc 
 
 CP 3027/2017 
 
  
51. 
 (1) M/s Hattar Rendering Plant 
(Pvt.) Ltd. Haripur  
 
Versus 
 
(1) Federation of Pakistan through 
Secretary Ministry of Petroleum & 
Natural Resources, Islamabad etc 
 
 CP 3028/2017 
 
  
 
52. 
 (1) M/s Pan Asia Food Products 
(Pvt.) Ltd., Hattar, KPK 
 
Versus 
 
(1) Federation of Pakistan through 
Secretary Ministry of Petroleum & 
Natural Resources, Islamabad etc 
 
 CP 3029/2017 
 
  
53. 
 (1) M/s Pakistan Services Limited 
 
Versus 
 
(1) Pakistan through Secretary 
Ministry of Petroleum & Natural 
Resources, Islamabad etc 
 
 
 CP 3124/2017 
 
  
54. 
 (1) 
Lucky 
Cement 
Limited, 
Peshawar 
Versus 
 
(1) Pakistan through Secretary 
Ministry of Petroleum & Natural 
Resources, Islamabad etc 
 
 CP 3138/2017 
 
  
55. 
 (1) M/s Sohail Vegetable Ghee 
Mills (Pvt.) Ltd. Peshawar  
 
Versus 
 
(1) Federation of Pakistan through 
Secretary Ministry of Petroleum & 
Natural Resources, Islamabad etc 
 
 CP 393-P/2017 
 
  
56. 
 (1) M/s Usman Ghee Industry  CP 3030/2017 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 10 :-
(Pvt.) Ltd., Swabi 
 
Versus 
 
(1) Federation of Pakistan through 
Secretary Ministry of Petroleum & 
Natural Resources, Islamabad etc 
 
 
  
57. 
 Khyber Match Factory Pvt Ltd 
 
Versus 
 
(1) Federation of Pakistan through 
M/o Petroleum, Islamabad etc 
 
 CP 3241/2017 
 
  
 
58. 
 Sana Aluminum Industries Pvt 
Ltd 
Versus 
 
(1) Federation of Pakistan through 
M/o Petroleum, Islamabad etc 
 
 CP 3259/2017 
 
  
 
59. 
 Top Star Industries Pvt Ltd 
 
Versus 
 
(1) Federation of Pakistan through 
M/o Petroleum, Islamabad etc 
 
 CP 3260/2017 
 
  
 
60. 
 M/s Mohsin Enterprises Pvt Ltd 
 
Versus 
(1) Federation of Pakistan through 
M/o Petroleum, Islamabad etc  
 
 CP 3327/2017 
 
  
 
61. 
 M/s Frontier Dextrose Limited, 
Haripur 
Versus 
 
(1) Federation of Pakistan through 
M/o Petroleum, Islamabad 
 
(2) 
OGRA 
through 
Chairman, 
Islamabad 
 
(3) 
SNGPL 
through 
its 
M.D, 
Lahore 
 
(4) G.M. SNGPL, Peshawar 
 
(5) Province of KPK through Chief 
Secretary 
 
 
 CP 3385/2018 
62. 
 M/s Abasement Steel Re-Rolling 
Mills 
 CP 3411/2017 
 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 11 :-
 
Versus 
 
(1) Federation of Pakistan through 
M/o Petroleum, Islamabad etc 
 
  
 
63. 
 AJ Textile Mills Limited  
 
Versus 
 
K-Electric Limited 
 
 CMA 9153/2017 
 
64. 
 (1) M/s Alamyar CNG Station, 
Lakki Marwat etc 
 
Versus 
 
(1) Federation of Pakistan through 
M/o 
Petroleum 
and 
Natural 
Resources, Islamabad etc 
 
 CMA 3076/2019 
in CA 1132/2017 
in CA 1113-
1115/17 
 
65. 
 (1) Iqbal Baig sole proprietor of 
M/s 
Labaik 
CNG 
Station, 
Hyderabad etc  
 
 CMA 9149/2019 
 
 
66. 
 M/s Citi CNG Zone, Karachi 
 CMA 
9305/2019 
in 
CMA 
9149/2019 in CP 
3138/2017 
 
(For Impleadment 
and for deletion of 
name) 
 
67. 
 M/s Habib-ADM Limited, Karachi 
 CMA 10608/2019 
in CP 3138/2017 
 
 
68. 
 (1) Prime Coat Pvt Ltd, Karachi 
etc 
 
 CMA 20/2020 in 
CP 3138/2017 
 
 
69. 
 (1) 
International 
Industries 
Limited, Karachi 
 
(2) International Steel Limited, 
Karachi 
 
(3) 
Pakistan 
Cable 
Limited, 
Karachi 
 
(4) Colgate-Palmolive (Pakistan) 
Limited, Karachi 
 
(5) M/s Popular Food Industries 
Pvt Limited, Karachi 
 CMA 
9746/2019 
in CP 3138/2017 
 
 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 12 :-
 
(6) M/s Popular Juice Industries 
Pvt Limited, Karachi 
 
(7) M/s Popular Aseptic Packaging 
Pvt Limited, Karachi 
 
(8) M/s Popular Fiber Mills Pvt 
Ltd, Karachi 
 
(9) M/s Popular Fabrics Pvt Ltd, 
Karachi 
 
(10) 
M/s 
Popular 
Match 
Industries, Karachi 
 
(11) Ghulam Ali Bhatia proprietor 
of M/s S.A. Brothers, Karachi 
 
(12) Asif Kazani proprietor of M/s 
Mehboob Re Rolling Mills, Karachi 
 
70. 
 (1) M/S Model Service Station, 
Karachi etc 
 
 CMA 
8497/2018 
in CP 3138/2017 
71. 
 M/s Shahjee CNG Rawalpindi 
 
 CMA 8279/2019 
72. 
 M/s 
Panthar 
CNG 
Station, 
Peshawar and another 
 
 CMA 8278/2019 
73. 
 M/s Daudzai CNG Filling Station, 
Peshawar and others  
 
 CMA 8277/2019 
74. 
 Fauji 
Fertilizer 
Company 
Ltd, 
Rawalpindi 
 
 CMA 9186/2019 
75. 
 M/s Enam Industries (Pvt) Ltd etc 
 
 CMA 5307/2017 
76. 
 M/s SNGPL 
 
 CMA 812/2020 
77. 
 M/s SNGPL 
 
 CMA 813/2020 
78. 
 M/s SNGPL 
 
 CMA 814/2020 
79. 
 M/s SNGPL 
 
 CMA 815/2020 
80. 
 Century Paper & Board Mills 
Limited 
 
 CMA 1022/2020 
81. 
 M/s Al-Muizz Group CNG Station, 
Kohat 
 
 CMA 9521/2019 
82. 
 Fauji 
Fertilizer 
Bin 
Qasim 
Limited, Islamabad 
 
 CMA 9301/2019 
83. 
 M/s 
Badhan 
CNG 
Station,  CMA 9844/2019 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 13 :-
Nowshera 
 
84. 
 M/s Akram Cotton Mills Limited 
and another 
 
 CMA 2014/2020 
85. 
 M/s Akram Cotton Mills etc 
 CMA 86/2020 
 
 
For the appellant(s)/ 
Applicant(s)/petitioner(s): 
Mr. Makhdoom Ali Khan, Sr. ASC 
Mr. Saad Hashmi, Adv. 
(In C.As.1150 to 1155/2017) 
 
Mr. Rashid Anwar, ASC (via video link @ 
Karachi) 
Syed Rifaqat Hussain Shah, AOR 
(In C.As.1115 to 1123/2017) 
 
Mr. Isaac Ali Qazi, ASC (via video link @ 
Peshawar) 
Mr. M. S. Khattak, AOR 
(In C.As.1124 to 1127, 1133, 1134/17, 
CPs.3027-3030 & 3411/17) 
 
Mr. Anwar, Kamal, Sr. ASC 
Br. Ahmed Pervaiz 
(In CMA 86/20) 
 
Kh. Muhammad Saeed, ASC 
(In CA 1114/17) 
 
Syed Haziq Ali Shah, ASC 
Mr. M. S Khattak, AOR 
(In C.As.1128 to 1131, 1135 to 1140/2017 
& 
C.Ps.3124, 3259 & 3260/2017) 
 
Sardar Muhammad Ghazi, ASC 
Syed Rifaqat Hussain Shah, AOR 
(In C.A.1132/2017 & C.M.As.8277, 8278 & 
9521/2019) 
 
Ms. Navin Merchant, ASC  
(In C.M.A. 9746/2019) 
 
Mr. Abid S. Zuberi, ASC  
(In C.M.A. 9153/2019) 
 
Qazi Ghulam Dastgir, ASC 
(in C.As.1113, 1141-1149/17, 3076/19) 
 
Salman Akram Raja, ASC (via video link @ 
Lahore) 
Mr. Mehmood A. Sheikh, AOR 
(In C.P.3138/2017 & CMA 9186, 9301/19) 
 
Mr. Ijaz Ahmed Zahid, ASC 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 14 :-
Mr. Habib Bhatti, ASC 
(in CMA 1022/20) 
 
Mr. Abdul Munim Khan, ASC  
Mr. Tasleem Hussain, AOR  
(via video link @ Peshawar) 
(In C.Ps.387-P, 389-P, 3327/2017) 
 
Mr. Tasleem Hussain, ASC/AOR 
(via video link @ Peshawar) 
(In C.Ps.392-P to 394-P, 399-P, 400-P & 
3241/2017) 
 
Mr. Muneer A. Malik, Sr.ASC  
Ch. Atif Rafique, ASC (via video link @ Kar) 
Mr. Kassim Mirjat, AOR 
Syed Rifaqat Hussain Shah, AOR 
(in CMA.8497/18 & 9149/19) 
 
Syed Iqbal Hashmi, ASC 
Ch. Akhtar Ali, AOR 
(in CMA.9746/19) 
 
 
For SNGPL: 
 
 
For SNGPL: 
 
Mr. Waqar Ahmed Rana, ASC 
(In all Appeals/Petitions)  
 
Br. Mian Belal, ASC 
Br. Muhammad Adil Fayyaz 
(in CMAs.812-815/20) 
 
For Federation: 
 
 
 
 
For ICT: 
Mr. Anwar Mansoor Khan, Attorney General 
Ch. Aamir Rehman, Addl. AGP 
Mr. Sohail Mehmood, D.A.G. 
Mr. Sajjid Ilyas Bhatti, Addl. AG 
  
Mr. Niaz Ullah Niazi, Advocate General 
 
For Govt. of Balochistan: 
Mr. M. Ayaz Swati, Addl. AG  
Mr. M. Farid Dogar, AAG 
 
For Govt. of Punjab: 
 
For Govt. of KP: 
Ch. Faisal Farid, Addl. AG  
 
Mr. Shumail Butt, AG   
 
For Accountant General 
for Pakistan: 
 
For OGRA: 
 
 
 
 
 
 
 
 
Mr. Sardar Azmat Shafi, Accountant Gen. of 
Pak. 
 
 
Mr. Rizwan ul Haq, Sr. Executive Dir. 
(Litigation) (OGRA)  
Mrs. Taybbah Ahsan, JED, Fin. (OGRA) 
Ms. Samia Khalid, ASC (OGRA) 
Mr. Aatif Sajjad, Executive Dir. Fin. (OGRA) 
Mr. Sajid Zahid Rauf, JED Gas (OGRA) 
Syed Faisal Ishtiaq, Law Officer (OGRA)) 
Dr. Abdul Basit Qureshi, Registrar, OGRA 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 15 :-
 
 
For Finance Division, 
Govt. of Pakistan: 
 
 
 
For ISGCL: 
 
For M/o Petroleum: 
 
Mr. Atif Hussain, JED Fin. OGRA 
Mr. Asif, JED (Gas) OGRA 
 
Mr. Anwar, Sr. JS Fin. Div. 
Mr. Tanvir Butt, Sr. JS (Budget) Fin. Div.  
Mr. Sajjad Azhar, Dy. Secy. Budget Resources 
Mr. Javed Iqbal Khan, JS, B-II Fin. Div. 
 
Mr. Mobeen Solat, MD, ISGCL 
 
Mr. Abdul Maqsood Malik, EDG, Dir. 
Petroleum 
 
 
 
Dates of hearing: 
03.02.2020, 10.02.2020, 11.02.2020, 
12.02.2020, 13.02.2020, 17.02.2020, 
18.02.2020, 19.02.2020 & 20.02.2020 
 
JUDGMENT 
FAISAL ARAB, J. - The appellants as well as the petitioners 
and the intervenors all utilize natural gas for their industrial and 
commercial activities. Some of them even use natural gas as fuel 
for their in-house power generation facilities. Those who own CNG 
stations use natural gas for converting it into Compressed Natural 
Gas (CNG) at their filling stations and then sell it to their 
customers. 
2. 
Before discussing the controversy involved in the case we 
find it appropriate to briefly discuss the background of the laws 
that imposed Cess from the year 2011. 
3.    In the year 2011 the Gas Infrastructure Development Cess 
Act, 2011 (GIDC Act, 2011) was legislated through a bill 
introduced in the National Assembly as a Money Bill by treating 
the imposition thereunder as a specie of ‘tax’ whereby Cess was 
imposed on industrial and commercial consumers of natural gas. 
This was done to finance the cost which Pakistan has to bear for 
laying the overland pipelines through which natural gas was to be 
imported into the country from Iran and Turkmenistan. Apart from 
import of natural gas from the above two countries, LNG imported 
from Qatar on ships, after its discharge at the Karachi port, was to 
be gasified and transported up-country through a pipeline called 
North-South pipeline. The said Act was challenged by the 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 16 :-
industrial and commercial consumers of natural gas located in the 
Province of Khyber Pakhtunkhwa in the Peshawar High Court in 
the year 2011 and they succeeded in seeking a declaration that it 
is ultra vires the Constitution in the year 2013. The Federal 
Government appealed which was dismissed by this Court on 
22.08.2014 after holding that the GIDC Act, 2011 in its character 
is a fee-imposing enactment, its bill could not have been 
introduced in the National Assembly as a Money Bill under the 
provisions of Article 73 of the Constitution. The said Act was thus 
declared to be ultra vires the Constitution, which decision has 
come to be known as Durrani Ceramics case reported in 2014 
SCMR 1630. 
4. 
Soon after the decision in Durrani Ceramics case, the 
President on 25.09.2014 promulgated the Gas Infrastructure 
Development Cess Ordinance, 2014 through which Cess on 
natural gas was again imposed, which Ordinance was also given 
retrospective effect from 15.12.2011, the date when the GIDC Act, 
2011 came into effect. While the GIDC Ordinance, 2014 was still in 
the field, the Federal Government sought review of Durrani 
Ceramics case which was dismissed by this Court vide judgment 
dated 15.04.2015 reported as Federation of Pakistan v. Durrani 
Ceramics (PLD 2015 SC 354).  
5.   Within a month of the dismissal of the review petition, the 
Parliament 
on 
15.05.2015 
passed 
the 
Gas 
Infrastructure 
Development Cess Act, 2015 (GIDC Act, 2015) whereby Cess was 
again imposed on all consumers of natural gas excluding the 
domestic sector consumers. The purpose of its imposition was the 
same as was stated in the GIDC Act, 2011. In terms of Section 8 of 
GIDC Act, 2015 the levy and collection of Cess made under the 
GIDC Act, 2011 as well as under GIDC Ordinance, 2014 was also 
legitimized with retrospective effect.  
6. 
In this second round of litigation the industrial and 
commercial consumers assailed the vires of the GIDC Act, 2015 
before the Sindh High Court as well as in the Peshawar High Court 
claiming that like GIDC Act, 2011 the GIDC Act, 2015 be also 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 17 :-
declared ultra vires the Constitution as it has been enacted by the 
parliament beyond its legislative competence. The Sindh High 
Court declared the levy unconstitutional vide judgment dated 
26.10.2016 whereas the Peshawar High Court upheld the levy vide 
judgment passed on 31.05.2017 declaring the GIDC Act, 2015 to 
be intra vires the Constitution. These appeals have arisen from 
such decision with the leave of this Court. 
7. 
On 22.10.2019 when this case came up for hearing, it was 
pointed out to us by Mr. Muneer A. Malik, one of the counsel for 
the intervenors that 377 suits were filed by invoking Original 
jurisdiction of the Sindh High Court in which the vires of GIDC 
Act, 2015 were challenged and all were decreed vide common 
judgment dated 26.10.2016 whereby the GIDC Act, 2015 was 
declared to be ultra vires the Constitution. He further pointed out 
that the Federal Government has filed only one appeal bearing 
High Court Appeal No. 361 of 2016 against the plaintiff of one suit 
and not against the plaintiffs of the remaining 376 suits, including 
his client. They were not even made party in the said appeal and 
the time for filing appeal against them had already gone by. He 
contended that on account of such omission the decision rendered 
by the Single Judge has attained finality on the principle of res 
judicata for the rest of the plaintiffs and accordingly the GIDC Act, 
2015 in their cases is to be treated as ultra vires the Constitution 
and Cess cannot be charged from them. In support of this 
argument Mr. Muneer A. Malik relied upon the judgment of this 
Court rendered in the case of Pir Bukhsh & Others vs. Chairman 
Allotment Committee (PLD 1987 SC 145). As these appeals and 
connected petitions have emanated only from the decision of the 
Peshawar High Court which declared the GIDC Act, 2015 to be 
intra vires the Constitution this led us to pass an order on the said 
date that in identical matters pending in other High Courts 
opportunity be given to such litigants and their counsel to present 
their case before us on the merits of the controversy. This was 
done so that the challenge to the vires of the said Act be 
adjudicated upon once and for all at this Court’s level. Pursuant to 
our order dated 22.10.2019 several miscellaneous applications for 
joining in these proceedings as party were filed by those who had 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 18 :-
challenged the vires of the GIDC Act, 2015 in various other High 
Courts. All of them were given opportunity to present their point of 
view on the merits of the controversy. Certain other petitions which 
were filed against the judgment of the Peshawar High Court but 
did not come up for hearing at the time of grant of leave of these 
appeals were also taken up for hearing so that the same could be 
decided together with the appeals.  
8. 
Before we proceed to decide the merits of the main 
controversy we prefer to address the plea of res judicata raised by 
the intervenors first. 
9. 
The principle of res judicata is a principle of peace. Once a 
controversy with regard to a right in property or a right to office is 
adjudicated 
upon 
and 
attains 
finality 
through 
a 
judicial 
pronouncement of a competent Court of law, it no more remains 
open to challenge in any subsequent judicial proceedings between 
the same parties on the same subject matter. This principle is 
intended not to afford a litigant more than one opportunity for 
resolution of a judicial dispute and thus eliminates the chances of 
repetitious and successive litigation against a party on the same 
issue. The maxim that there should be an end to litigation is 
germane to such matters.  
10. 
Any relief which a litigant seeks in a judicial proceeding with 
regard to any power or a right or an obligation connected with 
some property or an office which power or right or obligation is not 
dependent upon the legitimacy of a legislative enactment and 
stands or falls on its own strength then in such cases when the 
decision rendered by a court of competent jurisdiction attains 
finality, there is no difficulty in applying the principle of res 
judicata to such a decision. However, it would be difficult to apply 
such a principle in matters where a power or a right or an 
obligation solely depend upon the very legitimacy of the enactment 
that has come under challenge in a Court of law on the touchstone 
of the Constitution. In such a situation the existence of such power 
or right or obligation would solely depend on the final adjudication 
as to the legal validity of the enactment itself. This could be 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 19 :-
understood from a situation where a controversy as regards 
constitutional validity of an enactment has come under challenge 
before two High Courts, one declaring the enactment ultra vires the 
Constitution and the other intra vires. If the principle of res 
judicata is applied to the decision of the High Court that declared 
the law ultra vires as the same was not challenged any further by 
the Government then two conflicting declarations would stand side 
by side on the legitimacy of a legislative enactment, one party 
treating the law valid and the other invalid. This would lead to 
treating an Act of the parliament valid for some and invalid for 
others though both the set of persons are similarly placed. If the 
decision rendered by the High Court that declared the law intra 
vires the Constitution is only challenged before the Supreme Court 
and after examining the merits of the case the enactment is 
declared by this Court to be intra vires the Constitution, then in 
such peculiar situation when this Court finally validates the 
legislative enactment then the same has to be applied uniformly to 
every person falling within its ambit. Such final judicial 
determination on the legitimacy of a legislative enactment has to be 
treated as a judgment in rem regardless of the fact that the 
judgment of the High Court that invalidated the very same 
enactment was not challenged before this Court. Such a situation 
warrants departure from the doctrine of res judicata. Omission of a 
public functionary to file appeal cannot put fetters on the universal 
application of a legislative enactment declared by this Court to be 
constitutionally valid as it would amount to repealing the statute 
for some and treating it valid for others. Hence conflicting 
decisions on the vires of a legislative enactment of two High 
Courts, decision of one remains unchallenged in the hierarchy as 
no appeal was preferred and the other is challenged before this 
Court, then the verdict of the High Court that went unchallenged, 
which is in conflict with the final decision of this Court has to be 
treated as outmoded and no longer executable. The Supreme Court 
of the United States of America took note of a similar situation in 
the case of United States vs. Stone & Downer Co. [274 U.S. 225 
(1927)] and held that if some of the persons are released from the 
application of a provision of legislative enactment on the principle 
of res judicata, it will lead to inequalities and discrimination 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 20 :-
causing injustice and confusion. It was held that in such a 
situation the plea of res judicata cannot be sustained. Following 
passages from the said judgment of the Supreme Court where it 
refused to apply the principle of res judicata in a revenue matter 
can be quoted with considerable advantage:  
‘………. One large importing house may secure a judgment in its 
favor from the Customs Court on a question of fact as to the 
merchandise of a particular importation or a question of construction 
in the classifying statute. If that house can rely upon a conclusion in 
early litigation as one which is to remain final as to it and not to be 
reheard in any way, while a similar importation made by another 
importing house may be tried and heard and a different conclusion 
reached, a most embarrassing situation is presented. The importing 
house which has by the principle of the thing adjudged obtained a 
favorable decision permanently binding on the government will be 
able to import the goods at a much better rate than that enjoyed by 
other importing houses, its competitors. Such a result would lead to 
inequality in the administration of the customs law, to discrimination 
and to great injustice and confusion. In the same way, if the first 
decision were against a large importing house and its competitors 
instituted subsequent litigation on the same issues with new 
evidence or without it and succeeded in securing a different 
conclusion, the first litigant, bound by the judgment against it in 
favor of the government must permanently do business in 
importations of the same merchandise at great and inequitable 
disadvantage with its competitors. 
These were doubtless the reasons which actuated the Court of 
Customs Appeals when the question was first presented to it to hold 
that the general principle of res judicata should have only limited 
application to its judgments………………………………The fact that 
objection to the practice has never been made before in the history of 
this court or in history of the Court of Customs Appeals in 18 years 
of its life is strong evidence, not only of the wisdom of the practice, 
but of general acquiescence in its validity. The plea of res judicata 
cannot be sustained in this case.’ 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 21 :-
11. 
In the case of Pir Bukhsh & others V. Chairman Allotment 
Committee (PLD 1987 SC 145), on which much reliance was placed 
by Mr. Muneer A. Malik, the learned counsel for one of the 
intervenors, the controversy was with regard to a right of allotment 
of land which did not depend on the constitutionality of a 
legislative enactment. In that case, the principle of res judicata 
clearly applied but this principle, as discussed above, cannot be 
applied in the same manner to a case where any power or a right 
or an obligation of a person solely depend upon the legitimacy of a 
legislative enactment without which such power or right or 
obligation has no existence of its own. Hence, when the power of 
the government to charge and the obligation of the persons to pay 
a tax or a fee depends on the determination of vires of a legislative 
enactment then the final determination of this Court has to be 
uniformly applied on all those upon whom the law was intended to 
apply otherwise it would be applied in a discriminatingly manner 
to a section of persons belonging to one and the same class of 
persons. The final determination of this Court on the legitimacy of 
a law has to apply even to those who had succeeded in obtaining a 
judgment from a Court lower in the hierarchy that the law is ultra 
vires the Constitution, they too would be bound by the judgment of 
this Court which being the final Court of the judicature has 
through a judicial pronouncement declared a legislative enactment 
to be valid. The power of the Federal Government to charge the 
Cess and the obligation of the payers to pay under GIDC Act, 2015 
would depend upon such final determination by this Court. Such 
power or obligation arising from an enactment will not cease to 
exist for the reason that the High Court in some other proceedings 
has declared the said Act ultra vires the Constitution which 
remained unchallenged. We in our minds are therefore clear that 
where there are two conflicting adjudications with regard to the 
constitutionality of a legislative enactment, standing side by side, 
then the one that has the binding effect on the other has to become 
the law of the land on the subject without any distinction 
whatsoever as an Act of the Parliament in its application cannot be 
allowed to be regarded as intra vires the Constitution for one set of 
persons and ultra vires for another at the same time when both 
belong to the same class of persons. If this is allowed, it would 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 22 :-
result in discrimination as some would be bound to discharge the 
obligation arising from the Act of the Parliament thereby putting 
them in disadvantageous position against those who are 
discharged from the obligation on the principle of res judicata. 
Such a position cannot be allowed to be sustained.  
12. 
The validity of the plea of res judicata can be looked at from 
another angle also. The learned Additional Attorney General has 
pointed out that one High Court Appeal has been filed against the 
common judgment of the Single Judge of the Sindh High Court 
rendered in 377 suits and those decree holders who have been left 
out in that appeal would be made party in the pending appeal. If 
that has already been done then this Court in similar situation has 
held in the cases of Mehran Zaibun Nisa etc. versus Land 
Commissioner, Multan etc. (PLD 1975 SC 397) and Province of 
Punjab versus Muhammad Tayyab (1989 SCMR 1621) that a matter 
filed after the period of limitation can also be decided on merits 
with a connected case that was filed within time. So belated joining 
of some of the parties in the appeal as respondents who were 
initially not made party would not be of much consequence. In any 
case, the right of the Federal Government to challenge the 
judgment of the Single Judge of the Sindh High Court cannot be 
said to be altogether lost as one appeal is still pending. So, the 
decision of the Sindh High Court cannot be said to have attained 
finality in the strict sense of the word. Even otherwise, the right of 
the Federal Government to defend the decision of the Peshawar 
High Court in these proceedings before us does not get swallowed 
by the judgment of the Sindh High Court. That right also still 
subsists. There is yet another aspect of the matter. We vide our 
order dated 22.10.2019 had decided to hear all the parties who 
have challenged the GIDC Act, 2015 in the High Courts so that 
their point of view on the controversy could also be heard on 
merits. So, as intervenors, not only the plaintiff against whom High 
Court Appeal has been filed joined the proceedings and through its 
counsel addressed this Court on the merits of the main 
controversy but the counsel of those plaintiffs against whom no 
appeal was filed have also addressed this Court on merits of the 
controversy so that the controversy relating to the validity of GIDC 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 23 :-
Act, 2015 is finally decided. For this reason too the principle of res 
judicata would also not come in the way of the Federal 
Government. In these circumstances the maxim that there should 
be end to litigation once the matter has been finally decided is not 
attracted as finality with regard to validity or otherwise of the GIDC 
Act, 2015 is yet to be reached in these proceedings. In the peculiar 
situation stated above, the plea of res judicata cannot be 
sustained.  
13. 
We shall now proceed to examine the merits of the main 
controversy.  
14. 
The bill of GIDC Act, 2015 was introduced under the 
provisions of Article 70 of the Constitution by treating it as a specie 
of fee-levying enactment which was accordingly passed by both 
houses of the Parliament. This was done for the reason that when 
the bill of GIDC Act, 2011 was introduced in the National Assembly 
through a Money Bill as a tax-imposing enactment the same was 
struck down in Durrani Ceramics case for the reason that the levy 
being a fee imposing enactment, its bill could not have been 
introduced in the National Assembly under Article 73 of the 
Constitution as a Money Bill. 
15. 
Mr. Makhdoom Ali Khan as lead counsel for the appellants 
argued the case, whose arguments were adopted by several 
counsel appearing on behalf of the appellants, petitioners and the 
intervenors. The counsel who also made additional submissions 
were Mr. Muneer A. Malik, Mr. Salman Akram Raja, Mr. Rashid 
Anwar, Mr. Isaac Ali Qazi, Mr. Anwar Kamal, Syed Haziq Ali Shah, 
Sardar Muhammad Ghazi, Mr. Abid S. Zuberi, Qazi Ghulam 
Dastgir, Mr. Ijaz Ahmed, Mr. Abdul Munim Khan and Mr. Tasleem 
Hussain. Barrister Mian Bilal argued on behalf of Sui Northern 
Gas Pipeline Limited and Chaudhry Aamir Rehman, learned 
Additional Attorney General argued on behalf of the Federation. 
16. 
The arguments that were advanced on behalf of the counsel 
for appellants / petitioners / intervenors, which are relevant for 
the disposal of these cases on merits of the main controversy can 
be summarized as follows:- 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 24 :-
a) The GIDC Act, 2015 would survive only if the Federation can 
demonstrate that it is a fee-levying enactment and that too 
within the ambit of Entry 2 read with Entry 15 of Part II of the 
Federal Legislative List contained in the Fourth Schedule to the 
Constitution. The GIDC, Act, 2015 is neither a tax nor a fee 
which places it outside the Fourth Schedule, hence ultra vires 
the Constitution. 
 
b) Fee can only be levied and collected if the state provides a 
service directly in return to the payer otherwise it would be a 
tax-imposing enactment. It is the direct nature of the service 
which marks the boundary between tax and fee. The Federation 
could not show that any direct or special service would be 
provided to the appellants as a reward or recompense for 
payment of the fee. There is no quid pro quo in the enactment.  
 
c) There can be compulsory exactions but must be based on 
services which are available or may be made available 
immediately or shortly after the payment of the fee. It is not 
necessary that a service is rendered in full immediately on 
payment of fee as it can be rendered incrementally. There may 
also be a gap between the payment of fee and provision of 
service, however the provision of the service cannot be 
indefinitely postponed on a hope to be provided in the 
unforeseeable future. 
 
d) Section 4 of the Act, 2015 provides that Cess is to be used for 
the development of Iran-Pakistan Pipeline Project (IP) as well as 
Turkmenistan-Afghanistan-Pakistan-India 
Pipeline 
Project 
(TAPI). Both projects mentioned in Section 4 of the Act 2015 
have neither commenced nor has the government given any 
tangible timeframe for their launch or completion. The two 
terminals that are operated by Engro and PGPCL at Karachi 
port are financed from other sources so the Cess is no longer to 
be utilised for LNG and now can only be utilised for IP and TAPI 
projects and projects ancillary thereto. 
 
e) Under Section 4 of GIDC Act, 2015, the Cess is a specific 
purpose levy, the Federation is not free to use it as it pleases. 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 25 :-
There was no evidence of the amount collected towards Cess 
ever having been spent for the specified purposes. Between 
2011 and 30th June 2019 a sum of Rs.295,402,787,597.67 has 
been 
collected 
out 
of 
which 
Rs.279,575,000 
and 
Rs.207,664,501 have been spent. The Government has failed to 
justify the collection of Cess. 
 
f) Revenue of Cess so far collected has not been put in any special 
fund but has been made part of general revenues of the state 
and retained in the Federal Consolidated Fund. 
 
g) The Second Schedule to GIDC Act, 2015 only mentions the 
maximum rates of tax but the actual rate of tax to be charged 
was not specified. 
 
h) The supply of gas in the province of Khyber Pakhtunkhwa is in 
excess of the demand, therefore, the GIDC Act, 2015 conferred 
no benefit on its residents. The shortage was created for 
reasons extraneous to the demand in the Province. 
 
i) Section 3(1) of the GIDC Act, 2015 used the terms ‘levied’ and 
‘charged’ which indicate that it is a tax imposing enactment and 
not ‘fee’ and while enacting GIDC Act, 2011 which is a similar 
Act, legislated as a tax-imposing enactment. 
 
17. 
In support of their arguments learned counsel for the 
appellants / petitioners / intervenors have placed reliance on the 
cases of Collector of Customs v. Shaikh Spinning Mills (1999 SCMR 
1402), Abdul Majid v. Province of East Pakistan (PLD 1960 Dacca 
502), Sohail Jute Mills v. Federation of Pakistan (PLD 1991 SC 329), 
Nishat Tek Ltd, Lahore v. Federation of Pakistan (PLD 1994 Lahore 
347), M/s Fatima Enterprises Ltd. v. Federation of Pakistan (1999 
MLD 2889), M/s Coca-Cola Beverages v. Cantonment Board 
Chaklala Rawalpindi (2011 MLD 1987), Soneri Bank Ltd v. 
Federation of Pakistan (2013 PLC Labour 134), East Pakistan 
Chrome Tannery (Pvt.) Ltd. v. Federation of Pakistan and others 
(2011 PTD 2643), Pakcom Ltd v. Federation of Pakistan (PLD 2011 
SC 44), Azgard Nine v. Government of Pakistan (2013 PTD 1030), 
Tata Textile Mills v. Federation of Pakistan (2013 PTD 1459), M/s 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 26 :-
Shahbaz Garments Pvt. Ltd v. Federation of Pakistan (2013 PTD 
969),  Associated Industries Ltd v. Government of Pakistan (2015 
PTD 193), Workers’ Welfare Funds, M/o Human Resources 
Development, Islamabad and others v. East Pakistan Chrome 
Tannery (Pvt.) Ltd. and others (PLD 2017 SC 28), Flying Cement 
Company v. Federation of Pakistan (PLD 2016 Lahore 35), Dr. 
Mahmood-ur-Rehman Faisal v. Secretary Ministry of Law (PLD 1992 
FSC 195), ABN Amro Bank N.V. v. M.D KW&SB (2006 CLC 597), 
Kewal Krishan Puri and others v. State of Punjab and others (1980) 
1 SCC 416), State of Maharashtra v. Salvation Army (AIR 1975 SC 
846), Al-Samrez Enterprises v. Federation of Pakistan (1986 SCMR 
1917), The Hingri-rempur Coal Co. Ltd and Ors. v. The State of 
Orissa and Ors. (AIR 1961 SC 459), Sona Chandi Oaz Committee v. 
State of Maharashtra (AIR 2005 SC 635), FECTO Belarus Tractor 
Ltd v. Government of Pakistan (PLD 2005 SC 605), Dr. Mohashir 
Hassan v. Federation of Pakistan (PLD 2010 SC 265), Contempt 
Proceedings against Chief Secretary, Sindh (2014 PLC (CS) 82), Pir 
Baksh v. the Chairman, Allotment Committee (PLD 1987 SC 145). 
Human Rights Case No.14392 of 2013 and Suo Motu Case No.1 of 
2013 (2014 PTD 243), Shahtaj Sugar Mills Ltd v. Province of Punjab 
(1998 SCMR 2492), The Town Municipal Committee, Amravati v. 
Ramchandra Vasudeo Chimote and Another. (AIR 1964 SC 1166), 
M/s. Ujagar Prints and others v. Union of India and others (AIR 
1989 SC 516), Baz Muhammad Kakar v. Federation of Pakistan 
(PLD 2012 SC 923), Kewel Krishan v. State of Punjab (AIR 1980 SC 
1008) and State of Maharashtra v. Salvation Army (AIR 1975 SC 
846).  
 
18. 
Learned Additional Attorney General has placed reliance on 
the cases of B.S.E. Brokers’ Forum, Bombay and others v. Securities 
and Exchange Board of India and others (2001 (3) SCC 482), Krishi 
Utpadan Mandi Samiti v. Ashok Kumar Dinesh Chandra and 
another (1996 (10) SCC 100), The City Corporation of Calicut v. 
Thachambalath Sadasivan and others (AIR 1985 SC 756), M/s. 
Gasket Radiators Pvt. Ltd. v. Employees’ State 
Insurance 
Corporation and another (AIR 1985 SC 790). Barrister Mian Bilal 
has placed reliance on the case of The City Corporation of Calicut v. 
Thachambalath Sadasivan  (AIR 1985 SC Court 756), Gasket 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 27 :-
Radiators (Pvt.) Limited v. Employees’ State Insurance Corporation 
(AIR 1985 SC 790), The Hinger-Ramper Coal Co. Ltd v. The State of 
Orissa & Others (AIR 1961 SC 459), Municipal Corporation of Delhi 
v. Mohd. Yasin (AIR 1983 SC 617), Sudhindra Thirtha Swamiar v. 
The Commissioner for Hindu Religious & Charitable Endowments, 
Mysore  (AIR 1963 SC 966) and Jaora Sugar Mills (Pvt.) Limited v. 
The State of Madhya Pradesh (AIR 1966 SC 416).  
 
19. 
Under the Constitution it is the prerogative of the legislature 
to raise revenue for the government on matters that fall within its 
legislative competence. The legislature enjoys the privilege to 
identify the base of the levy i.e. those upon whom the incidence of 
the levy would fall and also determine the quantum to be charged 
from them, which could either be at a fixed rate or ad valorem. 
Under our Constitution the legislature can levy taxes as well as 
fees. As GIDC Act, 2015 has been enacted by the Parliament as a 
fee-levying enactment, we deem it appropriate to briefly discuss the 
legal concept of such enactments. 
 
20. 
There are two kinds of fee-imposing legislative enactments 
which have been defined in various judicial pronouncements, both 
from our as well as foreign jurisdictions. One is based purely on 
the principle of quid pro quo i.e. a charge is payable for rendering a 
specific service or extending a specific privilege which the payers 
can avail subject to the conditions that may be attached to it. In 
other words, it can be called as ‘fee-simplicitor’. In such an 
enactment there is direct and immediate correlation in absolute 
terms between the service that is rendered and the fee that is 
charged for it. The other kind of a fee-levying legislation is where 
Cess is imposed as a compulsory exaction in the same manner 
where taxes are imposed with the distinction that it is imposed for 
achieving a specific purpose promised in the enactment itself 
which when realized would bring some advantage or benefit for the 
payers in future. It can be described as ‘purpose specific’ and in 
many judicial pronouncements have been termed as ‘Cess-fee’. In 
such a form of levy, the specified purpose is pre-committed to the 
payers before the revenue is collected under the legislation. To 
quote a few examples, Cess is imposed to meet the extraordinary 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 28 :-
costs involved in providing infrastructure such as construction of 
dams or for importing oil or gas from abroad through pipelines or 
to build farm to mill roads in order to facilitate marketing of the 
agricultural produce or for conducting research and development 
in some specialized field. In such a form of levy the rule of quid pro 
quo does not exist in the same sense as it exists in a case where an 
existing service is rendered or a privilege is extended directly to the 
payer for a fee. What needs to be taken into consideration is 
whether the enactment has promised some benefit or advantage for 
the payers to be made available in future by utilizing the revenue, 
making it more akin to a fee then a pure revenue raising measure 
like taxes in general are imposed with no precondition attached for 
their spending. In a case from the Indian jurisdiction cited by one 
of the counsel of the appellants reported as Hinger-Rampur Coal 
Co. Ltd and others V. The State of Orissa (AIR 1961 SC 459) the 
Supreme Court of India in paragraphs 9 and 10 while discussing a 
fee-imposing enactment observed as follows: 
‘If specific services are rendered to a specific area or to a 
specific class of persons or trade or business in any local 
area, and as a condition precedent for the said services or in 
return for them cess is levied against the said area or the said 
class of persons or trade or business, the cess is 
distinguishable from a tax and is described as a fee. 
 
21.  In the case of Sona Chandi Oal Committee vs. State of 
Maharashtra (AIR 2005 SC 635) the Indian Supreme Court while 
describing fee based levy observed as follows: 
 
‘……… The levy does not cease to be a fee merely because 
there is an element of compulsion or coerciveness present in it, 
nor is it a postulate of a fee that it must have a direct relation 
to the actual service rendered by the authority to each 
individual who obtains the benefit of the service. Quid pro quo 
in the strict sense was not always a sine qua non for a fee. All 
that is necessary is that there should be a reasonable 
relationship between the levy of fee and the services rendered 
and it is not necessary to establish that those who pay the fee 
must receive direct or special benefit or advantage of the 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 29 :-
services rendered for which the fee was being paid. It was 
held that if one who is liable to pay, receives general benefit 
from the authority levying the fee, the element of service 
required for collecting the fee is satisfied.’ 
 
22.   Then in the case of State of West Bengal v. Kesoram Industries 
Limited (AIR 2005 SC 1646) the Indian Supreme Court in 
paragraph 145 of its judgment observed as under: 
‘……. The impugned cess can, therefore, be justified as a fee 
for 
rendering 
such 
services 
as 
would 
improve 
the 
infrastructure and general development of the area, the 
benefits whereof would be availed even by the stone-crushers. 
 
23. 
Barrister Mian Bilal has placed reliance on the case of M/s. 
Gasket Radiators Pvt. Ltd. v. Employees’ State 
Insurance 
Corporation and another (AIR 1985 SC 790) wherein it has been 
held as under:- 
“Merely because the benefits to be received are postponed, it 
cannot be said that there is no quid pro quo. It is true that 
ordinarily a return in praesenti is generally present when fee 
is levied but simultaneity or contemporaneity of payment and 
benefit is not the most vital or crucial test to determine 
whether a levy is a fee or not. In fact, it may often happen that 
the rendering of a service or the conferment of a benefit may 
only follow after the consolidation of a fund from the fee 
levied. Hospitals, for instance, cannot be built in a day nor 
medical facilities provided right from the day of the 
commencement of the scheme. It is only after a sufficient 
nucleus is available that one may reasonably expect a 
compensating return. The question of how soon a return may 
be expected or ought to be given must necessarily depend on 
the nature of the services required to be performed and 
benefits required to be conferred.” 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 30 :-
24.  The basic difference between the enactment where fee-
simplicitor is imposed and where Cess-fee is imposed is that in the 
former a service or a privilege is made available to the payer 
directly on the strict principle of quid pro quo whereas in the latter 
case, the declared purpose comes with a promise to bring some 
benefit or advantage in future which is basically meant for its 
payers. Such benefit or privilege once made available on the 
ground may be availed by others as well but that would not change 
the status of such fee-levying enactment. It would remain a specie 
of fee-levying enactment in contradistinction to tax-levying 
enactment in which no specific purpose or specific service needs to 
be disclosed by the legislature in order to justify its imposition. 
25.    When Cess as a fee is levied to meet an earmarked financial 
exigency spelt out in an enactment, it preserves the levy for such 
purpose only even with the change in the government setup. It 
cannot be levied as a general revenue collecting tool and the 
government would not be justified to collect it if the funds are 
diverted to some other expenditure. So it is like a ‘promised 
spending’ to be applied to the specific purpose described in the 
enactment. Hence, in order to remain as a fee-levying enactment, 
the purpose for which the Cess is to be charged should be well 
spelled out and defined in the enactments as narrowly as possible 
lest it may convert it into a tax-levying enactment. The proceeds of 
Cess should be clearly identifiable in the accounts by using 
separate accounting codes so that its collection and utilization is 
reconcilable with the purposes stated in the enactment. A 
correlation between the revenue collected and the expenditure 
incurred for the promised specific purpose should always be 
maintained. In this manner the earmarked levy also provides 
information on the amount collected and spent. This also 
inculcates confidence in the payers as it contains the promise that 
the revenue would be utilized for the specific purpose only for 
which it was collected and they would have a claim to 
transparency and accountability of the utilization of the revenue so 
collected. They can claim that the revenue cannot be utilized for 
any other purpose other than for which they have been charged. 
When the revenue can only be utilized for the purpose promised in 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 31 :-
the fee-levying enactment then in that sense the levy could also be 
regarded as a temporary levy. Once the purpose for which it was 
imposed stands served, the justification for its imposition also 
comes to an end. The collection of Cess therefore should be based 
on some calculation keeping in view the funding requirements and 
as and when the purpose is achieved, the government loses it right 
to collect Cess regardless of the fact that the enactment continues 
to remain in force. 
26. 
After discussing the two kinds of fee-levying enactments, we 
shall now proceed to examine whether the GIDC Act, 2015 is a fee 
or tax-levying enactment and whether it was legislated within the 
legislative competence of the Parliament.  
27. 
The counsel for the appellants in support of their argument 
that the Cess levied under GIDC Act, 2015 is a tax, basically made 
its comparison with such fee-levying enactments where the 
principle of quid pro quo was the only consideration i.e. comparison 
was made with service specific enactments describable as ‘fee-
simplicitor’. The controversy in the present case is comparable with 
the enactments that impose fee for a specific purpose that is 
promised to be achieved for the benefit of the payers in future i.e. a 
category described in various judicial pronouncements as ‘Cess-
fee’. In Durrani Ceramics case also it was held that practically the 
Federal Government has demonstrated that GIDC Act, 2011 was a 
fee imposing enactment, which for its object and purpose was no 
different from GIDC Act, 2015. In paragraph 22 of Durrani 
Ceramics case it was observed ‘……. Similarly, in the Annual Budget 
Statement (Federal Budget 2013-14) that carries a similar worded 
preface, 'Gas Infrastructure Development Cess' has again been 
listed at C03916 as Non-Tax Revenue. Thus on the Government's 
own showing, as reflected in the Annual Budget, GIDC is not a 'tax'. 
No argument has been advanced on behalf of the appellants to 
explain away the categorization of GIDC as Non-Tax Revenue by the 
Government in the Annual Budget… . The above determination is 
sufficient to hold that being a 'fee' the same could not have been 
imposed through a money bill and on this score the levy was liable 
to be struck down.’ Thus what invalidated the GIDC Act, 2011 in 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 32 :-
Durrani Ceramics case, as is evident from its paragraphs 22 was 
that GIDC Act 2011 being a fee-levying enactment its bill could not 
have been introduced in the National Assembly as a Money Bill 
under Article 73 of the Constitution.  This is precisely the ratio of 
Durrani Ceramics case which is evident from its concluding 
paragraph 45 also.  
28. 
Keeping in mind the above legal infirmity with which the 
legislative process suffered in the legislation of GIDC Act, 2011 
which led this Court in Durrani Ceramics Case to declare it invalid, 
the legislature introduced the bill of GIDC Act, 2015 under Article 
70 of the Constitution which was passed by both the houses of the 
Parliament as a fee-levying enactment. By recasting the GIDC Act, 
2015 as a fee-levying instead of tax-levying enactment the 
constitutional requirements that lacked in the GIDC Act, 2011 
were met. This Court in several cases has recognized the right of 
the legislature to re-enact a law on the same subject, which on 
account of legal infirmities in its enactment process had been 
declared invalid by a Court of law, by removing the causes that led 
to its invalidity. The legislature is also competent to make the re-
enacted law applicable retrospectively in order to bind even the 
past transactions that had been declared invalid. In the case of 
Molasses Trading & Export (Pvt.) Limited Vs. Federation of Pakistan 
(1993 SCMR 1905) this Court at page 1920 held as follows:-  
"Before considering this question it would be appropriate to 
make certain general observations with regard to the power of 
validation possessed by the legislature in the domain of taxing 
statute. It has been held that when a legislature intend to 
validate a tax declared by a Court to be illegally collected 
under an invalid law, the cause for ineffectiveness or 
invalidity must be removed before the validation can be said 
to take place effectively. It will not be sufficient merely to 
pronounce in the statute by means of a non-obstinate clause 
that the decision of the Court shall not bind the authority, 
because that will amount to reversing a judicial decision 
rendered in exercise of the judicial power, which is not within 
the domain of the Legislature. It is therefore necessary that 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 33 :-
the conditions on which the decision of the Court intended to 
be avoided is based, must be altered so fundamentally, that 
the decision would not any longer be applicable to the altered 
circumstances. One of the accepted modes of achieving this 
object by the Legislature is to re-enact retrospectively a valid 
and legal taxing provision, and adopting the fiction to make 
the tax already collected to stand under the re-enacted law. 
The Legislature can even give its own meaning and 
interpretation of the law under which the tax was collected 
and by `legislative fiat' make the new meaning biding upon 
Court. It is in one of these ways that the Legislature can 
neutralize the earlier decision of the Court. The Legislature 
has within the bound of the Constitutional Limitation the 
power to make such a law and give it retrospective effect so 
as to bind even past transaction. In ultimate analysis 
therefore a primary test of validating piece of legislation is 
whether the new provision removes the defect, which the 
Court had found in the existing law, and whether adequate 
provisions in the validating law for a valid imposition of tax 
were made." 
 
29.   In the case of Mamukanjan Cotton Factory Vs. Punjab Province 
(PLD 1975 SC 50) this Court at pages 53-54 held as follows:-  
 
“Mr. A. K. Brohi, appearing in support of these two petitions, 
frankly conceded, that he did not find it possible to question the 
vires of the validating Ordinance on the grounds canvassed in 
the High Court. With the permission of this Court, learned 
counsel, however, attacked the vires of the Ordinance and the 
resultant action of the Provincial Government on a fresh ground. 
His argument in nutshell was that the validating Ordinance 
purports to enable the Provincial Government to retain and claim, 
what according to the judgments of the High Court, the 
Government could not have at the material time, levied and 
collected. These judgments are rendered by the High Court, in 
exercise of its jurisdiction conferred by the Constitution itself. The 
validating Ordinance on the other hand, is sub-constitutional 
legislation, which according to learned counsel cannot undo or 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 34 :-
destroy, what he described as the "end product" of the 
Constitutional jurisdiction. 
 
The argument, in my opinion, is without substance and which 
ii accepted would indeed lead to startling results. It would strike 
at the very root of the power of Legislature, otherwise competent 
to legislate on a particular subject, to undertake any remedial or 
curative legislation after discovery of defect in an existing law as 
a result of the, judgment of a superior Court in exercise of its 
constitutional jurisdiction. The argument overlooks the fact, that 
the remedial or curative legislation is also "the end product" of 
constitutional jurisdiction in the cognate field. The argument if 
accepted, would also seek to throw into serious disarray the 
pivotal arrangement in the Constitution regarding the division of 
sovereign power of the State among its principal organs; namely, 
the executive, the Legislature and the judiciary each being the 
master in its own assigned field under the Constitution. 
  
The argument of learned counsel also conveniently overlooks 
string of cases, in which the vires of the remedial legislation, 
competently made, was upheld by this Court, notwithstanding 
the earlier judgments of the Superior Courts, in exercise of their 
constitutional jurisdiction, to the contrary effect. The foremost and 
exactly in point among these cases is the judgment in Dossa Ltd. 
v. The Province of the Punjab, in which as in these cases, the 
vires of the validating Ordinance of 1971, was called in question. 
It was inter alia observed in that case:- 
  
"The last contention, namely, that the Ordinance of 1971 could 
not validate something which was void ab initio in terms of the 
Act of1949, loses sight of the fact that it is open to the Legislature 
to confer retrospective operation on the laws made by it. A 
reference to the provisions of this Ordinance leaves no doubt that 
the law maker expressly made its operation retrospective with 
the avowed object of conferring validity on a demand which was 
not valid under the original Act of 1949. 
 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 35 :-
30. 
To the same effect are the judgments of this Court rendered 
in the cases of Molasses Trading & Export (Pvt.) Ltd Vs. Federation 
of Pakistan (1993 SCMR 1905), FECTO Belarus Tractor Ltd Vs. 
Government of Pakistan through Finance Economic Affairs (PLD 
2005 SC 605), Dr. Mobashir Hassan Vs. Federation of Pakistan 
(PLD 2010 SC 265) and Contempt Proceedings against Chief 
Secretary, Sindh (2014 PLC (C.S.) 82). 
 
31. 
In many landmark cases this Court has also held that 
Courts should lean towards the constitutionality of a legislative 
enactment instead of destroying it, keeping in view the rules of 
constitutional interpretations. A seventeen member full Court in 
paragraph 39 of its judgment rendered in the case Dr. Mobashir 
Hassan Vs. Federation of Pakistan (PLD 2010 SC 265) in paragraph 
39 stated as follows:- 
‘There is another principle of law, which casts duty upon 
this Court to the effect that it should normally lean in 
favour of constitutionality of a statute and efforts should be 
made to save the same instead of destroying it. This 
principle of law has been discussed by this Court on a 
number of occasions. Reference in this behalf may be made 
to the cases of Abdul Aziz v. Province of West Pakistan 
(PLD 1958 SC 499), Province of East Pakistan v. Siraj-ul-
Haq Patwari (PLD 1966 SC 854), Inam-ur-Rehman v. 
Federation of Pakistan (1992 SCMR 563), Sabir Shah v. 
Shad Muhammad Khan (PLD 1995 SC 66), Multiline 
Associates v. Ardeshir Cowasjee (PLD 1995 SC 423), Tariq 
Nawaz v. Government of Pakistan (2000 SCMR 1956), Asif 
Islam v. Muhammad Asif (PLD 2001 SC 499) and 
Federation of Pakistan v. Muhammad Sadiq (PLD 2007 SC 
133). This principle has been appropriately dealt with in 
the case of Elahi Cotton Mills Ltd. v. Federation of Pakistan 
(PLD 1997 SC 582) in the following terms:- 
  
"that the law should be saved rather than be destroyed 
and the Court must lean in favour of upholding the 
constitutionality of legislation, keeping in view that the rule of 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 36 :-
constitutional interpretation is that there is a presumption in 
favour of the constitutionality of the legislative enactments 
unless ex facie it is violative of a constitutional provision."’ 
32.    As to the legislative competence of the Parliament to pass the 
GIDC Act, 2015 as a fee-imposing enactment, in a case from the 
Indian jurisdiction reported as Ujagar Prints V. Union of India and 
others (AIR 1989 SC 516) cited by one of the counsel of the 
appellants the Indian Supreme Court in paragraph 23 while 
discussing the application of legislative entries to an enactment 
observed that entries to the Legislative Lists are not the source of 
legislative power but are merely topics of fields of legislation and 
must receive a liberal construction inspired by a broad and 
generous spirit and not in a narrow pedantic sense. In paragraph 
25 it was further observed that if a legislation purporting to be 
under a particular legislative entry is assailed for lack of legislative 
competence, the State can always show that the law was 
supportable 
under 
any 
other 
entry 
within 
its 
legislative 
competence. In the case of Elahi Cotton Mills Ltd. v. Federation of 
Pakistan (PLD 1997 SC 582) relied upon by one of the appellants’ 
counsel this Court held that the entries in the Legislative List of 
the Constitution are not powers of legislation but only fields of 
legislative heads and allocation of the subjects to the lists is not by 
way of scientific or logical definition but by way of mere simple 
enumeration of broad catalogue.  
33.   The provision of the Constitution that enables the legislature 
to legislate GIDC Act, 2015 is Entry No.54 of Part I of the Federal 
Legislative List contained in the Fourth Schedule. This entry states 
‘Fees in respect of any of the matters in this Part, but not including 
fees taken in any court.’ When we glance through the entries of 
Part I of the Federal Legislative List in order to see which specific 
entry enables the Parliament to cover the subject stated in the 
GIDC Act, 2015, we find Entry No.27. It provides ‘Import and export 
across customs frontiers as defined by the Federal Government, 
inter-provincial trade and commerce, trade and commerce with 
foreign countries; standard of quality of goods to be exported out of 
Pakistan’. This entry, inter alia, covers legislation that relates to 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 37 :-
subjects of import into Pakistan and trade with foreign countries 
and the mode through which natural gas can be cheaply and 
efficiently imported from nearby countries where it is more than 
sufficient for their needs is through overland pipeline. This is 
exactly the purpose and object of the GIDC Act, 2015 as reflected 
by its Section 4 which provides that the revenue that is to be 
generated from Cess shall be utilized for facilitating import of 
natural gas into Pakistan through two separate transnational 
pipelines and for ancillary projects. It states ‘The cess shall be 
utilized by the Federal Government for or in connection with 
infrastructure 
development 
of 
Iran-Pakistan 
Pipeline 
Project, 
Turkmenistan-Afghanistan-Pakistan-India (TAPI) Pipeline Project, 
LNG or other ancillary projects.’ For such purpose trade agreements 
have also been executed with Iran and Turkmenistan separately. In 
addition to this Section 4 of the GIDC Act, 2015 also provides that 
the Cess was required for the purposes of LNG which under a 
trade agreement with Qatar is being imported on ships and after 
its discharge at the port of Karachi and gasification, is planned to 
be transported upcountry through a pipeline project named ‘North-
South pipeline’. From this it has become evident that the whole 
purpose of enacting GIDC Act, 2015 was to facilitate import of 
natural gas, a very important source of energy from the nearby 
countries under trade agreements executed with them. The fee 
imposed under the GIDC Act, 2015 is clearly intended to facilitate 
import into Pakistan natural gas on the basis of trade agreements 
executed with foreign countries which acts clearly fall within the 
ambit of Entry No. 27 of Part I of the Federal Legislative List 
contained in the Fourth Schedule to the Constitution.  
34. 
The industrial and commercial consumers of natural gas of 
this country, from whom Cess is being collected, consume about 
76% of the total supply of natural gas, which fact was also brought 
to the notice of this Court in the Durrani Ceramics case. They 
would be mainly benefited once the promised projects are 
completed. It does not matter if domestic consumers of natural gas 
would also be benefitted. Mr. Salman Akram Raja had argued that 
as his client is getting sufficient supply of natural gas from the 
wellhead located very near to its installation therefore the imported 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 38 :-
gas would be of no benefit for his client who may be exempted from 
the levy of Cess as there exists no quid pro quo. In a legislative 
enactment where there is an element of compulsion, which can be 
even in an impost such as Cess-fee, the payer does not enjoy the 
privilege of avoiding the obligation at his choice. If such a plea is 
accepted then every consumer would be able to take it and that 
would virtually nullify the Act itself at the choice of the payers. In 
the case of Hinger-Rampur Coal Co. Ltd. V. The State of Orissa (AIR 
1961 SC 459) the Indian Supreme Court in its paragraph 10 has 
observed:- 
‘There is, however, an element of compulsion in the imposition 
of both tax and fee. When the Legislature decides to render a 
specific service to any area or to any class of persons, it is not 
open to the said area or to the said class of persons to plead 
that they do not want the service and therefore they should be 
exempted from the payment of the cess.’ 
 
35. 
It was also argued that in Section 3(1) of the GIDC Act, 2015 
the terms ‘levied’ and ‘charged’ are used which demonstrate that it 
is a tax imposing enactment and not ‘fee’. The learned counsel 
attempted to strengthen this argument by relying on the stand 
which the Federal Government in Durrani Ceramics case took that 
the levy in the GIDC Act, 2011 was a tax-imposing enactment. 
When the terms like ‘levy’ or ‘charge’ are used in any revenue 
raising enactment, it does not mean that it cannot be a fee 
imposing enactment. A plea taken by a party on a point of law 
which was not accepted by a Court in an earlier round of litigation 
cannot be used against such party which on account of such 
decision has accordingly changed its plea in subsequent legal 
proceedings. In any case the terms ‘levied’ or ‘charged’ mean ‘to 
impose by legal authority’. Whether tax is being imposed or a fee, it 
entirely depends upon the object of the legislation and has nothing 
to do with the use of such terms. Even in Article 279 of the 
Constitution the term ‘levied’ is used for tax as well as for fee 
imposing legislations. So mere use of terms like ‘levied’ or ‘charged’ 
cannot be made basis to describe a law as tax imposing enactment. 
As the GIDC Act, 2015 contains a well-defined object meant for 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 39 :-
making future availability of natural gas more convenient and 
without interruption that would mainly benefit the industrial and 
commercial consumers which the appellants, the petitioners and 
the intervenors undeniably are, therefore, in pith and substance 
the GIDC Act, 2015 is a fee-imposing enactment and use of terms 
like ‘levied’ or ‘charged’ would not change the object with which it 
was legislated. 
 
36. 
It was also argued that in Section 3 (1) of the GIDC Act, 2015 
it is stated that Cess shall be levied and charged by the Federal 
Government which means that Federal Government has been 
empowered to levy it as and when it so decides which decision is 
yet to come. It was contended that until the Federal Cabinet so 
decides and upon such decision the Federal Government issues 
notification in this behalf, Section 3 (1) would remain inoperative. 
When an Act of Parliament provides that it will come into force at 
once then every provision of it becomes enforceable from the day 
the Act receives the assent of the President unless any provision of 
the Act itself suggests that it will come into force only when some 
authority nominated in this behalf so decides or on the happening 
of an event. No such precondition has been attached to Section 3 
(1) for its coming into operation. It clearly states that the Cess shall 
be levied and charged by the Federal Government from the gas 
consumers of the companies which are listed in the First Schedule 
and such companies shall be responsible for billing and collection 
and making onward payment of the Cess so collected from the gas 
consumers to the Federal Government. When such is the 
unqualified mandate of Section 3(1) of GIDC Act, 2015 and the 
responsibility of billing and collection has already been cast upon 
the companies listed in the First Schedule from the day when it 
comes into effect then the Cess becomes chargeable from that very 
day without leaving it to the Federal Government to first decide 
when to bring Section 3(1) into operation. On the other hand, 
where the legislature intends to leave a matter for the Federal 
Government to decide before it is given effect to then it specifically 
states so in the law itself. This can be seen from the contents of 
Section 7 of the GIDC Act, 2015 which provides ‘The Federal 
Government may, by notification in the official Gazette, make such 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 40 :-
amendments in the First Schedule as it deems fit.’ No such 
precondition is contained in Section 3 (1) of the GIDC Act, 2015. 
 
37. 
It was also argued that the GIDC Act, 2015 is discriminatory 
as the domestic consumers of natural gas have been excluded from 
the levy. From the contents of Section 3 (1) of the GIDC Act, 2015 
it is evident that the incidence of Cess falls only on commercial and 
industrial concerns. In our opinion this may have been for the 
reason that the Cess which the industrial and commercial 
concerns pay becomes part of the cost of the goods which they sell 
or the cost of the services they render and thus is ultimately borne 
by the buyers of their goods and services. Same is the case with 
the consumers of CNG. The burden of the Cess payable by the 
owners of CNG stations on their purchases of natural gas gets 
factored in towards fixation of sale price of CNG. Every industrial 
and commercial entity using natural gas for its business activity is 
entitled to claim the burden of Cess as their business expense, 
being part of the cost of their goods sold or services rendered, and 
get it adjusted against their business profits. They must have 
already done so in their books of account and the annual returns 
of their income must have been filed before the Income tax 
authorities accordingly. Thus the Cess under GIDC Act, 2015 has 
been levied only on those consumers of natural gas who on 
account of their industrial or commercial dealings pass on its 
burden to their customers/ clients. This is not the case with the 
domestic consumers of gas as the question of passing on the 
burden in their case obviously does not arise. For this reason, the 
domestic consumers may have been treated an altogether different 
class of gas consumers and consciously excluded from the levy of 
Cess, which reason appears to be very sound. This could be the 
only distinction on the basis of which the domestic consumers 
were not burdened with the incidence of Cess under GIDC Act, 
2015. Needless to point out that the domestic consumers are 
indirectly burdened with the incidence of Cess in a way that 
whatever product or service they buy/avail from an industrial or 
commercial enterprise or purchase CNG from a CNG station, the 
element of cost of Cess having already been factored in the price of 
their purchases, it ultimately passes on to them. So looking from 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 41 :-
that angle too, the domestic consumer or an ordinary person 
becomes the ultimate payer of the Cess that is levied on industrial 
or commercial concerns who consume natural gas for their 
business activity. What emerges from this is that domestic 
consumers of natural gas being treated as a distinct class of 
consumers from industrial and commercial consumers, no 
discrimination in favour of domestic consumers emerges on 
account of their exclusion from the levy of Cess under GIDC Act, 
2015. 
38. 
Whatever Cess has been collected right from the day when 
when GIDC Act, 2011 came into force has been accounted for by 
the Federal Government in its annual accounts recording it under 
separate code numbers and is thus identifiable separately from the 
other revenues of the Federal Government. This would facilitate in 
seeking information on the amount collected as against the 
amount that is going to be spent for the purposes promised in the 
GIDC Act, 2015. Thus a correlation between the revenue collected 
and the expenditure which is going to be incurred for the promised 
specific purpose can be maintained. It matters not if the revenue 
so collected forms part of the Federal Consolidated Fund as it is 
the mandate of Article 78 of the Constitution itself that all 
revenues of the Federal Government has to made part of Federal 
Consolidated Fund. 
39. 
The background of the legal history of the controversy in 
question can be traced back to 2011, when the levy under GIDC 
Act, 2011 was challenged before the Peshawar High Court which in 
2013 declared the levy as ultra vires the Constitution and struck 
down the GIDC Act, 2011. The Islamabad High Court followed the 
same course in its judgment in 2014. As a result of these 
decisions, the matter came before this Court in the case which has 
come to be known as Durrani Ceramics case. This Court in its 
judgment refused to interfere with the decision rendered by the 
Peshawar High Court and declared the GIDC Act, 2011 as 
unconstitutional, holding that the levy in question was in fact a fee 
and not a tax, hence, it could not have been imposed through a 
Money Bill. The case came before this Court again in review, which 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 42 :-
was dismissed in 2015. Later, the Government enacted the GIDC 
Act, 2015 as a fee imposing enactment. The constitutional validity 
of the said Act was also challenged before the High Courts. The 
Sindh High Court declared the levy unconstitutional vide its 
judgment dated 26.10.2016 whereas the Peshawar High Court 
upheld the constitutionality of the new Act vide its judgment dated 
31.05.2017. 
While 
several 
other 
similar 
matters 
awaited 
adjudication before other High Courts issue came before this Court 
for a second time, in which we vide order dated 22.10.2019 allowed 
the parties concerned to join the present proceedings as 
intervenors so that they can have a chance to assist us in the 
present proceedings and get an opportunity to present their 
version of the case before us. If we look at this matter in retrospect, 
there 
has 
been 
continuous 
litigation 
pertaining 
to 
the 
constitutional validity of the GIDC cess right from 2011 till July 
2020 when we are finally deciding the controversy in these 
proceedings. Apart from continuous litigation on the issue, we were 
also told that due to international sanctions on Iran, the response 
to international tender for EPC contract was very poor as no 
contractor was willing to undertake the project. On TAPI it is 
stated that land acquisition proceedings is at an advance stage 
however work on laying of the pipeline could not start in 
Afghanistan on account of the insurgency in Afghanistan. It is also 
stated at the bar that now there are signs that work on laying the 
pipeline in Afghanistan may commence soon as the final draft of 
TAPI Project Land Management Law is on final review of the 
Government of Afghanistan. Hence the delay in the commencement 
of work on laying the pipelines on account of continuous 
proceedings in the High Courts as well as before this Court and the 
levy under both the enactments having been struck down as 
unconstitutional in the year 2013 and 2016, geopolitical situations 
in the neighboring countries which are beyond the control of the 
Federal Government. This means that the projects have not been 
deliberately abandoned and there is also no material on record to 
doubt the intentions of Federal Government in this behalf. The 
Executive, therefore, cannot be blamed for not laying down the 
pipelines in question. In such a situation where work has not yet 
started on the laying of the pipelines and no contract has been 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 43 :-
awarded it would also be premature to ask for laying any report 
before the National Assembly. 
 
40. 
At this stage, we like to refer to Entry No.51 of Part I of the 
Federal Legislative List contained in the Fourth Schedule to the 
Constitution. It reads ‘Taxes on mineral oil, natural gas and minerals 
for the use in generation of nuclear energy.’ As regards generation of 
nuclear energy is concerned, the scientific reality is that it originates 
from splitting of atoms of the uranium which generates heat. This 
process of splitting the atoms of uranium is called fission. The heat 
so generated helps in producing steam which is then used to 
operate turbines to generate electricity. As nuclear energy is 
produced only through the process of fission, fuels such as mineral 
oil or natural gas cannot be used for such purpose. Resultantly, no 
greenhouse gas emissions are produced while generating nuclear 
energy, hence it is also a clean source of energy. There are several 
other primary sources of generating energy such as fossil fuels like 
coal, petroleum, natural gas and sources like hydroelectric, solar 
and wind. None can be used as nuclear fuel to generate nuclear 
energy except uranium and its by-product plutonium. When such is 
the scientific reality then mineral oil and natural gas appearing in 
Entry No.51 on which the process of fission cannot apply to 
generate nuclear energy are to be read disjunctively, as both are 
sources of energy other than nuclear energy. 
41. 
While discussing the scope of Entry No.51 of Part I of the 
Federal Legislative List contained in the Fourth Schedule to the 
Constitution which was also examined in Durrani Ceramics case, we 
feel the need to highlight the fact that prior to the framing of the 
1956 Constitution the subject of mineral development was under the 
exclusive domain of the Federal Government for legislation which was 
administered under the federal law i.e. ‘The Regulation Mines and Oil 
Fields and Mineral Development (Government Control) Act, 1948.  
Hence legislation with regard to all minerals before 1956 Constitution 
came into force, fell within the domain of the Federal Government. 
Under the 1956 Constitution only two sources of energy, the mineral 
oil and natural gas were exclusively retained by the Federal 
Legislature as is evident from its Entry No.15 and iron, coal and 
other minerals were placed under Entry 12 of the Part II of the 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 44 :-
Concurrent List and under Entry No.41 regulation of mines and 
mineral development, excluding those mentioned in the Federal and 
Concurrent Lists fell in the Provincial List. Now for the first time an 
item described as ‘mineral resources for generation of nuclear energy’ 
was added in the 1962 Constitution under Entry No. 23 of the 
Federal Legislative List and mineral oil and natural gas were listed 
under Entry No.24 of the Federal Legislative List. This also recognizes 
the fact that mineral oil and natural gas though being sources of 
energy are distinct from the source that generates nuclear energy. In 
the 1973 Constitution mineral oil, natural gas and minerals for use 
in generation of nuclear energy were clubbed together under Entry 
No.51 for the simple reason that all three denote a common feature 
i.e. these are all sources of energy which the Federal legislature 
continued to retain for itself for legislation. Placing all three items 
under one and the same Entry is understandable. However, mere 
mention of all three sources of energy in one and the same entry does 
not mean that scientific reality has changed and the first two sources 
of energy i.e. mineral oil and natural gas can now also be used to 
generate nuclear energy. In the Durrani Ceramics case all items 
contained in Entry No.51 were read conjunctively, meaning thereby 
that Federal Government can levy tax on natural gas and mineral oil 
only if these sources of energy can be used to generate nuclear 
energy. It appears that no proper assistance on scientific lines was 
rendered by the law officers to this Court during the hearing of the 
Durrani Ceramics case hence the scientific fact that it was not 
possible to generate nuclear energy from mineral oil and natural gas, 
as these sources cannot be used as nuclear fuel was not taken into 
consideration. In view of the fact that nuclear energy can only be 
generated from uranium and its by-product plutonium and not from 
natural gas or mineral oil, the National Assembly was fully competent 
to impose tax on natural gas through a Money Bill on the strength of 
Entry No.51 of the Federal Legislative List. However, in these 
proceedings we leave this aspect at that as the law which was the 
subject matter of the controversy in Durrani Ceramics case is not in 
existence anymore and in light of decision in that case, the Federal 
Government also changed its stance and opted to impose fee. 
42. 
From what has been discussed above it can be concluded 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 45 :-
that the whole purpose of enacting GIDC Act, 2015 was to facilitate 
import into the country a very important source of energy i.e. 
natural gas / LNG from nearby countries in order to meet the ever 
expanding energy needs of the country as our own resources of 
energy are fast depleting and the cheapest way to import it is 
through overland transnational pipelines. The supply of imported 
LNG to various parts of the country after its import on ships 
through trans-provincial pipeline is also a project of the Federal 
Government. The incidence of the cost involved in doing so falls on 
the industrial and commercial consumers whose consumption 
account for more than three-fourth of the total supply of natural 
gas, which fact was also brought to the notice of this Court in 
Durrani Ceramics case. Such consumers, apart from being major 
beneficiaries of the imported gas, would on account of their 
business activity pass on the burden to their clients/customers 
being part of the cost of their goods or services which they sell to 
their customers / clients. The object which the Parliament has 
promised in the GIDC Act, 2015 is clearly ‘purpose based’ which is 
distinctly defined and carries with it an element of quid pro quo, 
making it a fee-imposing enactment instead of a pure revenue 
raising measure like taxes in general are imposed with no 
precondition attached for their spending. After seeing the purpose 
of the enactment clearly and the fact that its revenue is duly 
accounted for and has also not been diverted to any other use, we 
hold that the imposition of Cess under GIDC Act, 2015 is not a 
tax-imposing enactment. It was passed through a bill moved in the 
Parliament under Article 70 of the Constitution deriving its 
legislative competence from Entry 54 read with the enabling Entry 
No. 27 of Part I of the Federal Legislative List contained in the 
Forth Schedule to the Constitution thereby curing the defect which 
lead to the invalidation of the GIDC Act, 2011 in Durrani Ceramics 
case. The provisions of Section 8 of the Act, which give 
retrospective effect to the charge and recovery of ‘Cess’ levied from 
the year 2011 are also declared to be valid being within the 
legislative competence of the Parliament. Exercise of such a power 
has been recognized by this Court in the Case of Mamukanjan 
Cotton Factory Vs. Punjab Province (PLD 1975 SC 50). The levy 
imposed under Gas Infrastructure Development Cess Act, 2015 is 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 46 :-
therefore in accordance with the provisions of the Constitution. 
However, keeping in view the ground realities discussed in the 
preceding paragraph and the fact that around 295 billion rupees 
have already been collected towards Cass-revenue and together 
with the outstanding amount the total sum by the end of this 
month would be in the vicinity of seven hundred billion rupees, 
which is more than what is the estimated cost of the projects 
mentioned in Section 4 of the GIDC Act, 2015, we are constraint to 
issue following directions: - 
(i) 
From the date of this judgment, we restrain the Federal 
Government from charging Cess which power of the Federal 
Government shall remain suspended until the Cess-revenue 
collected and that which is accrued so far but not yet 
collected is expanded on the projects listed in Section 4 of 
the GIDC Act, 2015. 
 
(ii) 
In the remaining period of the financial year 2020-21 while 
considering fixation of sale price of CNG, OGRA shall not 
take into consideration the element of Cess under GIDC Act, 
2015 as one of the cost of sale of GNG. 
 
(iii) 
As all industrial and commercial entities which consume gas 
for their business activities pass on the burden to their 
customers / clients therefore all arrears of ‘Cess’ that have 
become due upto 31.07.2020 and have not been recovered 
so far shall be recovered by the Companies responsible 
under the GIDC Act, 2015 to recover from their consumers. 
However, as a concession, the same be recovered in twenty-
four equal monthly installments starting from 01.08.2020 
without the component of late payment surcharge. The late 
payment surcharge shall only become payable for the delays 
that may occur in the payment of any of the twenty-four 
installments.  
 
(iv) 
The Federal government shall take all steps to commence 
work on the laying of the North-South pipeline within six 
months and on TAPI pipeline as soon as its laying in 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 47 :-
Afghanistan reaches the stage where the work of laying 
pipeline on Pakistan soil can conveniently start and on IP 
pipeline as soon as the sanctions on Iran are no more an 
impediment in its laying. In case no work is carried out on 
North-South pipeline within the prescribed time and for 
laying any of the two other major pipelines (IP and TAPI) 
though the political conditions become conducive, the 
purpose of levying Cess shall be deemed to have been 
frustrated 
and 
the 
GIDC 
Act, 
2015 
would 
become 
permanently in-operational and considered dead for all 
intents and purposes. 
43. 
 
Subject to the directions contained herein above, all 
these appeals and connected petitions are dismissed. In the light of 
this decision and the directions contained therein all listed 
applications also stand disposed of.   
 
 
JUDGE 
 
 
 
JUDGE 
 
 
I with respect disagree with the reasoning and conclusion of 
the majority judgment and have therefore appended my own 
judgment separately.  
JUDGE 
 
Islamabad 
Approved For Reporting 
 
Announced on 13.08.2020 by Justice Mushir Alam 
 
Khurram  
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 48 :-
Syed Mansoor Ali Shah, J.-  
44.  
I have had the privilege of reading the judgment authored by 
my learned brother Faisal Arab J. with which my learned brother 
Mushir Alam J. has concurred (“Majority Judgment”). I, with 
respect, do not agree with the reasoning and conclusion of the 
Majority Judgment. I look at the issue somewhat differently. The 
principal question that concerns me is whether a fiscal levy 
imposed for a service to be rendered – a service dependent on the 
completion of long-term multinational infrastructural projects tied 
to the vagaries of international politics, exist without a reasonable 
timeline ? Is reasonable time, therefore, an essential constituent of 
quid pro quo?  Can a fee levying legislation, resting on reciprocity, 
impose a one sided obligation on the gas consumers to pay the levy 
while providing no timeline nor any consequences for failure to 
deliver the proposed service ? I venture to examine the 
constitutionality of the impugned levy (GIDC) in this background. 
45. 
Constitutionality 
and 
legality 
of 
Gas 
Infrastructure 
Development Cess ("GIDC”) imposed under the Gas Infrastructure 
Development Cess Act, 20151 ("Act") has come up for our 
consideration. Two provincial High Courts  have expressed 
contrary views; Sindh High Court has struck down the levy and the 
Act, as being unconstitutional, vide judgment2 dated 26.10.2016, 
whereas, Peshawar High Court has upheld the levy, vide judgment3 
dated 31.05.2017. Matters are still pending in other Provincial 
High Courts. 
46. 
GIDC is levied and charged4 by the Federal Government from 
the gas consumers5, other than the domestic sector consumers.  
According to the Act, GIDC is to be utilized6 by the Federal 
Government for infrastructure development of Iran Pakistan 
Pipeline Project (IP), Turkmenistan-Afghanistan-Pakistan-India 
(TAPI) Pipeline Project, LNG or other ancillary projects.   
                                       
1 ACT IV of 2015 which received the assent of the President on 21.05.2015 and was published in 
the Gazette of Pakistan Extraordinary, part-1 on 23.05.2015.  
2 M/s Century Paper & Board Mills Ltd and others vs. Federation of Pakistan and others.   
3 Passed in W.P 2178/2015, etc titled M/s Umair Steel vs. Federation of Pakistan and others, etc. 
4 section 3 of the Act 
5 Defined in section 2(a) of the Act. 
6 Section 4 of the Act. 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 49 :-
47. 
As a matter of background almost similar Cess (GIDC) was 
earlier imposed under The Gas Infrastructure Development Cess 
Act, 2011 (“Act, 2011”).7  Considering it to be a “tax” under item 
no.51 of Part I of the Federal Legislative List of the Constitution8, it 
was passed as a Money Bill under Article 73 of the Constitution. It 
was soon challenged after its promulgation by the gas consumers, 
primarily on the grounds; that GIDC was infact a Fee and could 
not have been introduced through a Money Bill bypassing the 
bicameral legislative procedure provided under Article 70 of the 
Constitution; and that the Parliament did not enjoy the legislative 
competence to impose “Tax” on “natural gas.”   
48. 
Peshawar and Islamabad High Courts struck down the Act, 
2011 and declared the levy of GIDC as being unconstitutional in 
Ashraf Industries (Pvt) Ltd9 and Master Textile Mills.10  Finally, the 
matter came up before this Court in Durrani Ceramics11.  This 
Court also declared the law unconstitutional on the ground that 
GIDC under Act, 2011 was not a Tax but a Fee and therefore could 
not have been passed as a Money Bill. Review filed against the 
same was also dismissed in Durrani Ceramics -II.12  
49. 
The Gas Infrastructure Development Cess Act, 2015 was 
promulgated on 21.05.2015 with modifications once again 
imposing GIDC (Cess) on all the gas consumers other than the 
domestic sector consumers. It drew its legislative competence from 
item no. 213 of Part II of the Federal Legislative List. The new Act is 
substantially a repeat of the previous Act, 2011 except that its 
legislative routing is through both the Houses of the Parliament in 
terms of Article 70 of the Constitution. The new legislation does not 
set out the essential constituents of the new levy (Fee) to show that 
GIDC is no more a Tax but a Fee. Perhaps the legislature simply 
                                       
7 ACT No. XXI of 2011. Received the assent of the President on 13.12.2011 and was published 
for general information in the Gazette of Pakistan Extraordinary on 15.12.2011. 
8 Item 51: Taxes on mineral oil, natural gas and minerals for use in generation of nuclear energy. 
9 Ashraf Industries (Pvt) Ltd. vs. Federation of Pakistan through Secretary, Ministry of Petroleum 
and Natural Resources, Control Secretariat and 3 others (2013 PTD 1732). 
10 Master Textile Mills & 275 others vs. Federation of Pakistan & others (PLD 2014 Islamabad 83) 
11 Federation of Pakistan through Secretary M/o Petroleum and Natural Resources and another vs. 
Durrani Ceramics and others (2014 SCMR 1630). [three member bench] 
12 Federation of Pakistan through Secretary Ministry of Petroleum and Natural Resources and 
another vs. Durrani Ceramics and others (PLD 2015 SC 354). 
13 Item no.2:  Mineral oil and natural gas; liquids and substances declared by Federal law to be 
dangerously inflammable. 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 50 :-
banked on the declaration given in Durrani Ceramics and thought 
that no additional legislative design was required. 
50. 
The constitutionality and legality of the new Act was 
challenged before the provincial High Courts in the country.  Sindh 
High Court vide judgment dated 26.10.2016 struck down the levy 
as being unconstitutional, however, the Peshawar High Court 
upheld the levy in its judgment dated 31.05.2017. Litigation is still 
pending in other Provinces, therefore, this bench vide order dated 
22.10.2019 had allowed parties in pending matters to join these 
proceedings as intervenors so that their contention and viewpoint 
can be heard. The matter has now come up before us for final 
determination. 
Grounds of challenge  
51. 
Several legal questions of varying complexities were raised 
before us in the startling backdrop of this case; the more 
fundamental and pivotal being; whether the Act imposes a Fee 
under 
our 
constitutional 
framework, 
especially 
when 
the 
corresponding service or quid pro quo is to be rendered in some 
distant future; whether different Cess rates provided in the Second 
Schedule to the Act are discriminatory; the failure to seek prior 
approval of the Federal Cabinet before initiating the legislative 
process of the Act; whether the Parliament can legislate without 
first allowing Council of Common Interest (CCI) to deliberate on the 
subject of natural gas which falls in Part II of the Federal 
Legislative List and without considering its recommendations. And 
in the absence of any notification and specification of the rates 
under section 3 of the Act, whether GIDC could be levied and 
charged; and finally whether the validation provision under section 
8 of the Act holds water and GIDC for the period prior to the Act 
was lawfully charged. I deal with the constitutionality of the Fee 
imposed and therefore some of the questions raised are not 
required to be answered in this case.   
52. 
I have had the opportunity of hearing the learned counsel for 
the parties and the intervenors extensively over days. I have 
examined the record of the case; the current status of the 
infrastructure development gas projects on the ground; the recent 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 51 :-
trends in the sub-continental comparative jurisprudence on the 
subject of Tax and Fee; and tried to understand the contemporary 
concept and meaning of Fee (with future service), now used for 
raising public finance for large infrastructure projects and have 
examined its constitutionality and legality under our living 
Constitution. 
OPINION 
 
Concept of Fee    
 
53. 
Summarizing the sub-continental jurisprudence14 on Tax 
versus Fee, I see that normatively, theoretically and legislatively 
three prominent tasks have been entrusted to taxation, namely; 
revenue augmentation, redistribution of wealth in society and 
regulatory function to ensure expected economic behaviour. Fee, 
on the other hand, has a narrower scope and is premised on a 
corresponding service in return or quid pro quo.  While tax is 
                                       
14 See:  Haji Dossa Limited, Karachi vs. Province of Punjab through Collector, 
Sahiwal and others (1973 SCMR 2), Workers' Welfare Funds, M/O Human 
Resources Development, Islamabad through Secretary and others vs. East 
Pakistan Chrome Tannery Pvt. Through G.M. Finance Lahore and others (PLD 
2017 SC 28), Sheikh Muhammad Ismail & Co. Ltd., Lahore vs. The Chief Cotton 
Inspector, Multan Division, Multan and others (PLD 1966 SC 388), Pakistan 
Flour Mills Association and another vs. Government of Sindh and others (2003 
SCMR 162), Hirjina Salt Chemicals (PAK.) Ltd. vs. Union Council, Gharo and 
others (1982 SCMR 522), Noon Sugar Mills Ltd. vs. Market Committee and 
others (PLD 1989 SC 449), Azad Government of the State of Jammu & Kashmir 
through Chief Secretary, Azad Kashmir Government, Civil Secretariat, 
Muzaffarabad vs. Haji Mir Muhammad Naseer and others (1999 PLC (C.S.) 
1173), Pakcom Limited and others vs. Federation of Pakistan and others (PLD 
2011 SC 44), Collector of Customs and others vs. Sheikh Spinning Mills (1999 
SCMR 1402), The Hingir-Rampur Coal Co vs. The State of Orissa (1961 SCR (2) 
537), Sreenivasa General Traders vs. State of Andhra Pradesh (AIR 1983 SC 
1246), Upaj Mandi Samiti vs. Orient Paper and Industries (1995 RRR (1) 327), 
Bangalore Development Authority  vs. Air Craft Employee Society (2012 (1) JLJR 
503), H.H. Sudhundra Thirtha Swamiar and others vs. The Commissioner for 
Hindu Religious and Charitable Endowments, Mysore and another (AIR 1963 SC 
966), Southern Pharmaceuticals and Chemicals, Trichur and others vs. State of 
Kerala and others (AIR 1981 SC 1863), The Chief Commissioner, Delhi and 
another vs. The Delhi Cloth & General Mills Co. Ltd. and others (AIR 1978 SC 
1181),  Calcutta Municipal Corporation and others  vs. Shrey Mercantile Pvt. 
Ltd. and others (AIR 2005 SC 1879), Bhagwan Dass Sood vs. State of Himachal 
Pradesh and others (AIR 1997 SC 1549), Bangalore Development Authority  vs. 
Air Craft Employee Society (2012 (1) JLJR503), Kewal Krishan Puri and another 
vs. State of Punjab and others (AIR 1980 SC 1008), Agriculture Market 
Committee, Rajam and others vs. Rajam Jute and Oil Millers Association, Rajam 
(AIR 2003 SC 1742), Upaj Mandi Samiti vs. Orient Paper and Industries (1995 
(1) RRR 327), The City Corporation of Calicut vs. Thachambalath Sadasivan and 
others (AIR 1985 SC 756), Kishan Lal Lakhmi Chand vs. State of Haryana 
(1993 Supp (4) SCC 461), The Commissioner, Hindu Religious Endowments, 
Madras vs. Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutt (AIR 1954 SC 
282), The State of West Bengal and another vs. Kesoram Industries Ltd. and 
others (AIR 2005 SC 1646), Municipal Corporation of Delhi and others vs. Mohd. 
Yasin (AIR 1983 SC 617) and Gasket Radiators Pvt. Ltd. vs. Employees' State 
Insurance Corporation and another (AIR 1985 SC 790). 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 52 :-
devoid of quid pro quo, it is a sine qua non for Fee. Tax and Fee 
both properly belong to the world of public finance.15 
54. 
A tax is a compulsory contribution to the government, 
imposed in the common interest of all, for the purpose of defraying 
the expenses incurred in carrying out the public functions or 
imposed for the purpose of regulation, without reference to the 
special benefits conferred on the one making the payment.16 As a 
corollary, tax being instrumental in revenue augmentation, its 
quantum need not commensurate with costs incurred by such 
public authority. Further, tax is devoid of any quid pro quo. Even 
where any benefit seems to flow, in case of tax, it is merely 
incidental and not primary. In other words, there exists no 
connection, whether direct and immediate or broad and casual 
between the contributor of tax and benefits. 
55. 
In a glaring contrast, Fee, is generally defined to be a charge 
for a special service rendered to individuals by some governmental 
agency. Ordinarily, Fees are uniform and no account is taken of 
the varying abilities of different recipients to pay. A Fee may either 
be regulatory or compensatory. Where a Fee is commensurate with 
the cost of rendering the service, though not in exact arithmetical 
equivalence, it is a compensatory Fee. On the other hand a Fee 
charged to regulate or control, is validly classifiable as regulatory 
Fee, provided it is not excessive or not dominantly intending to 
raise revenues for the public authority. Whilst both tax and Fee are 
compulsory exactions of money by public authority, their real 
distinction comprise in primarily what is known as quid pro quo 
test and proportionality of amount test.    
56. 
Accordingly a levy to be identified as Fee must have an 
element of quid pro quo between the payer and the public authority 
that imposed it. This quid pro quo or service rendered in return 
envisages an intimate and immediate relationship between 
rendition of service and the payer, who is direct beneficiary of such 
service, on a one-on-one basis. This proximity between the 
                                       
15 Pathak, Neha: “SLIPPERY SLOPES OF COMPENSATORY TAX AND FEE” – Journal of the 
Indian Institute  56   
16 Martin T Crowe, The Moral Obligation of Paying Just Taxes 12 (Catholic University of 
American Press, Washington D.C, 1944) 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 53 :-
beneficiaries and services can also be categorized for simplicity as 
“proximate quid pro quo.17” So the classical approach of Fee 
comprises the following: a) proximate quid pro quo i.e., rendition of 
certain services to the payers by government agency which 
amounts 
to 
special 
benefit/advantage 
to 
the 
payer; 
b) 
proportionality i.e., the amount imposed ought to commensurate 
with cost of services to be rendered; c) specific fund that ensures 
dedicated spending from an earmarked fund for specific purpose of 
that service. Merger of proceeds with general revenue to be spent 
for general purposes was not acceptable; d) primary objective that 
is to enquire whether the primary purpose of imposing levy is 
rendition of services and it is not merely incidental to 
augmentation of revenue. If latter predominates, it acts as negative 
restriction and the levy will be a tax18. 
57.  As the economy grew, Fee was imposed to render services to 
a large class of people or specified sector or area as a whole. In 
such cases, the relationship between the beneficiary and the 
services rendered became more generic, broad and remote. This is 
because such a service is to reach a general class of people or a 
specified sector or a designated area and not to an individual per 
se and therefore the service may also extend to free riders who are 
not the payers of Fee, hence the bond of proximity stands diluted. 
This shift has also been termed as “remote quid pro quo”19 which is 
used to describe the situation where services target beneficiaries 
which is a generic class comprising of a certain free riders but 
inclusive of payers. The shift from proximate to remote quid pro 
quo overtime does not mean that the service to be rendered to the 
payers of Fee would be any different or in any manner less. The 
scope and depth of service to be rendered depends on the nature of 
the service. Like in the instant case, the service of continuous and 
increased supply of natural gas, inspite of being a generic service, 
extending to a class of gas consumers including those who are not 
payers of GIDC, must still reach all the industrial gas consumers 
paying GIDC (Fee).    
                                       
17 phrase used by Pathak, Neha (supra note 15)  
18 supra note 15 
19 ibid 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 54 :-
58. 
The requisite earmarking of funds stands diluted in 
subsequent case law. Merely because collections for services 
rendered or grant of a privilege or license are taken to the 
consolidated fund of the state and not separately appropriated 
towards the expenditure for rendering the service is not by itself 
decisive.  
59. 
With proximate quid pro quo test replaced with remote quid 
pro quo test and the specific fund test being considered non-
determinant factor, the only test that remained untouched from 
the classical package was proportionality test. This test coupled 
with primary object test became new determinants of Fee. The 
modern approach to Fee therefore consists of three point check: (a) 
Primary object test- whether the plenary objective of the levy is 
rendition of service to specified class and this service is something 
other than something merely incidental; (b) Remote quid pro quo 
test- whether the payer receives a general benefit from the 
authority imposing levy; (c) Proportionality test - whether there 
exists a broad and generic co-relationship between services 
rendered and the amount of Fee charged20.    
Durrani Ceramics I and II    
60. 
In Durrani Ceramics this Court held that GIDC was not a Tax 
but a Fee and declared Act, 2011 to be unconstitutional for having 
been passed as a Money Bill. Relevant extracts are as under:-   
19. Upon examining the case-law from our own and other 
jurisdictions it emerges that the 'Cess' is levied for a 
particular purpose. It can either be 'tax' or 'fee' depending 
upon the nature of the levy. Both are compulsory exaction 
of money by public authorities. Whereas 'tax' is a common 
burden for raising revenue and upon collection becomes 
part of public revenue of the State, 'Fee' is exacted for a 
specific purpose and for rendering services or providing 
privilege to particular individuals or a class or a community 
or a specific area. However, the benefit so accrued may not 
be measurable in exactitude. So long as the levy is to the 
advantage of the payers, consequential benefit to the 
community at large would not render the levy a 'tax'. In the 
                                       
20 ibid. 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 55 :-
light of this statement of law it is to be examined whether 
the GIDC is a 'tax' or a 'fee'.  
20. To recapitulate the 'Cess' collected is to be utilized for 
specific purposes, namely, development of infrastructure of 
Iran Pakistan Pipeline Project, Turkmenistan Afghanistan 
Pakistan India (TAPI) Pipeline Project, LNG or other projects 
or for price equalization of other imported alternative fuels 
including LPG. An annual report regarding utilization of the 
amount so collected is to be regularly placed before the 
House after three months of the end of each fiscal year (See 
S. 4 of GIDC Act). The levy therefore is to be utilized only for 
the purposes mentioned in the GIDC Act. The same is not a 
common burden for raising revenue generally. The money 
so collected from the levy is to be utilized for a specific 
purpose for the advantage and benefit of the consumers of 
gas. The 'Cess' is basically to be levied on all consumers of 
gas 
with 
certain 
exemption, 
mainly 
for 
domestic 
consumers. This exemption is by way of relief to such 
consumers. Even otherwise the data so provided to us 
regarding consumption of gas by different sectors shows 
that the domestic sector consumes only 20.3% of the total 
gas whereas 76 % of the total gas is consumed by those 
from whom the 'Cess' is collected (see Pakistan Energy Year 
Book, 2012. The latter sector has invested in development 
of the infrastructure for utilization of gas for their respective 
concerns. As envisaged in section 4 of GIDC Act, the 'Cess' 
is mainly to be utilized for development of the pipelines 
from other countries and other similar projects in order to 
ensure continuous and increased supply of gas to this 
sector. Undoubtedly other consumers of country as a whole 
would also benefit from such Projects but the same is 
inconsequential compared to the advantage that will accrue 
to the payers. 
….. 
22. Another formidable argument on behalf of the 
respondents was based upon the National Assembly for the 
Financial Years 2012-13 and 2013-14….This Annual 
Budget Statement along with money bill is to be 
simultaneously transmitted to the Senate so that it may 
make recommendations to the National Assembly. Page-6 of 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 56 :-
the Statement contains list of Non-Tax Revenue, which 
under the Object Code C03916 includes 'Gas Infrastructure 
Development Cess'. Similarly in the Annual Budget 
Statement (Federal Budget 2013-14) that carries a similar 
worded preface, 'Gas Infrastructure Development Cess' has 
again been listed at C03916 as Non-Tax Revenue. Thus on 
the Government's own showing, as reflected in the Annual 
Budget, GIDC is not a 'tax'. No argument has been 
advanced on behalf of the appellants to explain away the 
categorization of GIDC as Non-Tax Revenue by the 
Government in the Annual Budget. This is not a mere 
accounting procedure as urged by Mr. Salman Akram Raja, 
Advocate Supreme Court, who in this context had relied 
upon Sheikh Muhammad Ismail & Co. v. Chief Cotton 
Inspector Council (supra), but were part of the Annual 
Budget Statements. As submitted by Mr. Makhdoom Ali 
Khan, Senior Advocate Supreme Court, the possible reason 
why the levy has been reflected as Non-Tax Revenue in the 
Budget was to exclude it from the divisible pool under the 
National Finance Commission (NFC) Award. The above 
determination is sufficient to hold that being a 'fee' the 
same could not have been imposed through a money bill 
and on this score the levy was liable to be struck down. 
…. 
31. Entry 51 mentions three items, namely 'mineral oil', 
'natural gas' and 'minerals' which are followed by the words 
"for use in generation of nuclear energy". The basic rule for 
interpretation of statutes is to give the words their ordinary 
and 
natural 
meaning. 
Deviation 
from 
this 
rule 
is 
permissible only when it becomes necessary, for example to 
avoid or overcome absurdity or render certain words 
meaningless. This exercise is undertaken when assigning 
the words their ordinary meaning does not reflect the true 
intention of the Legislature. By the use of 'and' in between 
'natural gas' and 'minerals' in Entry 51, all the three items 
are to be read conjunctively with the words following them. 
In the said Entry 'and' could have been substituted by 'or' 
only if without the change absurd consequences would 
have followed. Restricting 'mineral oil' or 'natural gas' to 
their use in the generation of nuclear energy would not lead 
to any absurdity….After all the Constitution is a living 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 57 :-
document which caters for future development and 
progress. Thus Entry 51 can only be accorded its natural 
meaning and the same shall be read conjunctively. 
Similarly the Last Antecedent Rule is of no help to the 
appellants when the plain reading does not admit of any 
other interpretation but that only such items mentioned 
therein can be subjected to tax that are used in the 
generation of nuclear energy. 
…. 
34. Admittedly 'natural gas' is subject to levy of Sales Tax 
and GIDC Act does not appear to suggest that it is another 
instance of Sales Tax levied by the Parliament on the supply 
of natural gas. As held in the above cited judgment, double 
taxation can be imposed only by clear and specific language 
and not by implication.   
35. Thus under section 2(46) of the Sales Tax Act, 1990 the 
'Cess' is one of the cost added to the price of the product for 
the calculation of sales tax. It cannot therefore be termed as 
another Sales Tax. 
…. 
36. Coming to Entry 52, Mr. Salman Akram Raja, Advocate 
Supreme Court, had not urged that the GIDC can be levied 
under the said Entry. The learned Attorney General initially 
made submissions with regard to the said Entry but 
ultimately did not seriously press the same. Mr. Makhdoom 
Ali Khan, Senior Advocate Supreme Court, in response to 
the said argument submitted that Entry 49 imposing Sales 
Tax on 'natural gas' and other commodities and Entry 52 
empowering the imposition of tax on capacity are mutually 
exclusive. That since the 'natural gas' has already been 
subjected to Sales Tax no additional tax can be levied on 
the capacity. The learned counsel in this context had 
referred 
to 
Kohinoor 
Industries 
Ltd., Faisalabad 
v. 
Government of Pakistan (ibid), Central Board of Revenue v. 
Seven-Up Bottling Company (Pvt.) Ltd. (ibid) and Ellahi 
Cotton Mills Ltd. v. Federation of Pakistan (supra). The 
above authorities clearly lay down, with reference to Entry 
52 and other Entries in Part-1 of the Federal Legislative 
List, that tax cannot be levied under the said Entry if the 
goods or activity has already been subjected to tax or duty 
under any other Entry. It follows that the GIDC is not 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 58 :-
covered by either of the three Entries, i.e. 49, 51 or 52 of 
Part-I of the Federal Legislative List. It was admitted on 
behalf of the appellant that for a 'tax' to fall under the said 
Federal Legislative List it must be covered by Entries Nos. 
43 to 53. Apart from the said three no other Entries were 
pressed in service on behalf of the appellants for declaring 
the 'Cess' as 'tax'. On this count too the 'Cess' could not 
have been introduced through a money bill under Article 73 
of the Constitution. 
…. 
42. It was pointed out on behalf of the respondents that the 
Ministry of Petroleum and Natural Resources was of the 
view that the issue of levy of the 'Cess' may be placed for its 
approval before the Council of Commons Interest, which 
represents all the federating units. Similar was the opinion 
expressed 
by 
the 
Ministry 
of 
Law, 
Justice 
and 
Parliamentary Affairs. This fact was expressly averred in the 
Constitution Petitions filed before the Peshawar High Court 
and was not denied by the Federal Government. True that 
such an advice or opinion or non-reference of the matter to 
the Council of Common Interest would not render the levy 
illegal or invalid, nevertheless it would have been 
appropriate had the federating units been taken into 
confidence, particularly in the context of Article 160(3) of 
the Constitution. 
…. 
45. To conclude the GIDC is a fee and not a tax, in the 
alternative it is not covered by any Entry relating to 
imposition or levy of tax under Part-I of the Federal 
Legislative List. On either counts the 'Cess' could not have 
been introduced through a money bill under Article 73 of 
the Constitution. The same was, therefore, not validly levied 
in accordance with the Constitution. 
61. 
Durrani 
Ceramics 
declared 
that 
setting 
up 
of 
the 
infrastructure development gas projects would ensure continuous 
and increased supply of gas for the gas consumers, thereby 
constituting a service against the Fee (GIDC) charged. The 
continuous and increased supply of gas to the gas consumers was 
an assumption drawn by the Court, as no such legislative promise 
is borne out from Act, 2011.  However, this assumption remained 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 59 :-
unchallenged in the review (Durrani Ceramics-II) by the parties and 
came to be the service rendered or quid pro quo under Act, 2011. 
The argument of the appellants that Durrani Ceramics has a 
limited precedential value, as it was restricted to the question of 
Tax and the legislative procedure of Money Bill, is not correct. This 
Court in answering these questions has also declared that GIDC is 
a Fee. This declaration was re-affirmed in review filed by the 
Federal Government. In the background of the jurisprudence 
discussed above, I see no reason to take a view different from that 
of Durrani Ceramics which simply holds that the concept of 
infrastructure development of gas pipeline projects leading to 
continuous and increased gas supply in the country constitutes 
service or quid pro quo for the appellants. The ground reality of the 
gas projects at the time of Durrani Ceramics was not so noticeable 
or stark as it is now (discussed hereunder) and, therefore, the 
delivery or actualization of the service, has come to be of critical 
importance.  
62. 
Moved by the facts on the ground, I feel it necessary to re-
examine the meaning and concept of Fee and the scope and extent 
of its inbuilt reciprocity - quid pro quo. The question, regarding 
“future service” which is of pivotal importance to this case, though 
raised in Durrani Ceramics, was not addressed or answered. I now 
move beyond Durrani Ceramics to grapple with the question of 
future service and look for a more contemporary meaning of quid 
pro quo. 
FUTURE SERVICE & TIMELINE 
63. 
Existing jurisprudence informs us that it is not that all the 
required services against a Fee must be in place before a Fee can 
be levied.21 Merely because the benefits to be received are 
postponed, it cannot be said that there is no ‘quid pro quo’. It is 
true that ordinarily a return in praesenti is generally the case when 
Fee is levied but simultaneity or contemporaneity of payment and 
benefit is not the most vital or crucial test to determine whether a 
levy is a Fee or not, especially in long-term projects. In fact, it may 
                                       
21 Agriculture Market Committee, Rajam and others vs. Rajam Jute and Oil Millers Association, 
Rajam (AIR 2003 SC 1742) 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 60 :-
often happen that the rendering of a service or the conferment of a 
benefit may only follow after the consolidation of a fund from the 
Fee levied. Hospitals, for instance, cannot be built in a day nor 
medical facilities or gas supply provided right from the day of the 
commencement of the scheme. It is only after infrastructure 
development is available that one may reasonably expect a 
compensating return. How soon a return may be expected or ought 
to be given must necessarily depend on the nature of the services 
required to be rendered and benefits required to be conferred.22 So 
while “service to be rendered” or quid pro quo in future is 
permissible it is equally important that the prospects of such a 
future service are certain, as if tied in time, with the payment of 
Fee. I come to this important question later in the judgment.  
- Instant case and its unique facts 
64. 
Let’s leapfrog from 2011 (imposition of GIDC) to 2014 
(Durrani Cermaics) and finally to 2020 (current case). The facts and 
figures of this case are admitted and show that utilization of GIDC 
as per the earlier and the recent statute is for setting up 
infrastructure development of Iran Pakistan Pipeline Project (IP), 
Turkmenistan-Afghanistan-Pakistan-India (TAPI) Pipeline Project, 
LNG or other ancillary projects. These projects were financed 
through the imposition of GIDC (Fee), used as a tool of public 
finance. The gas consumers have been paying GIDC for almost a 
decade, as is established from the accounts and the status of the 
projects placed before us by the Interstate Gas System (Pvt) Ltd, 
which we are informed, is the company that is to set up these 
projects on behalf of the Federal Government. The figures 
hereunder undisputedly reveal that there has been no work on the 
ground and these gas projects have no physical existence, 
whatsoever, 
in 
Pakistan. 
Letter 
of 
the 
Finance 
Division, 
Government of Pakistan dated 18.02.2020 signed by the Deputy 
Secretary (Budget Resources) filed23 in Court reveals that the total 
amount of GIDC accrued, collected and outstanding as on 
                                       
22 M/s. Gasket Radiators Pvt. Ltd. v. Employees' State Insurance Corporation & another (AIR 
1985 SC 790)  
23 through CMA 1259/2020 in CA Nos. 1113 to 1155/2017 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 61 :-
30.6.2019 is as under and does not include Late Payment 
Surcharge under section 3(3) of the Act.  
TOTAL COLLECTION OF GIDC 
 
Levy and Collection of GIDC 
Rs. In Million 
Sr.# 
Sector 
GIDC 
Accrued 
GIDC 
Collected 
GIDC  
Outstanding 
1 
Fertilizer Feed (old) 
192,240.31 
111,814.62 
80,425.69 
2 
Fertilizer Feed (New) 
68,281.71 
1,142.89 
67,138.82 
3 
Fertilizer – Fuel 
31,772.12 
15,205.66 
16,566.46 
4 
General Industry 
70,729.64 
24,402.27 
46,327.37 
5 
IPPs 
60,845.19 
51,713.50 
9,131.69 
6 
KESC 
40,421.05 
3,912.18 
36,508.87 
7 
GENCO/WAPDA 
67,317.33 
44,753.78 
22,563.55 
8 
Captive Power 
119,247.65 
17,522.73 
101,724.92 
9 
CNG Region-I 
53,420.68 
11,765.63 
41,655.05 
10 
CNG Region-II 
48,073.10 
13,169.51 
34,903.59 
 
Grand Total 
752,348.78 
295,402.77 
456,946.01 
 
The details of the funding and expenditure are as follows:-  
INTER STATE GAS SYSTEM (PVT.) LIMITED 
Summary of expenditure and funding of gas infrastructure projects:24  
 
Project 
Iran 
Pakistan  
(IP) Gas 
Pipeline 
Project 
TAPI 
Pipeline 
Project 
North 
South Gas 
Pipeline 
Project 
Underground 
Gas Storages 
Total 
                                     All amounts in PKR 
Estimated 
Project 
Cost 
271 
billion 
1,500 
billion 
405 billion 
75 billion 
2,251 
billion 
Pakistan share 
271 
billion 
31.353 
billion 
20.25 
billion 
75 billion 
397.6 
billion 
Development 
Phase expenditure 
– already incurred 
funded 
through 
GIDC 
(received 
todate) 
Nil 
0.483 
billion 
Nil 
Nil 
0.483 
billion 
                                       
24 1. No funds have been released to date for above gas infrastructure projects 
from GIDC except GOP equity contribution in TAPI Pipeline Company Limited 
(TPCL). The amount released is only PKR 482.57 million, an equivalent of USD 
4.1 million in respect of two cash calls (First and second financial closing) from 
TPCL for TAPI Project. The first tranche of USD 2.65 million was released in 
May 2016 and the second tranche of USD 1.45 million was in June 2019. ECC 
of the Cabinet approved to inject 5% equity into TAPI Project vide case 
No.ECC-164/23/2015 dated 18th December, 2015. 
2. As a stopgap arrangement, financing from GHPL for projects have been 
arranged by ECC. 
 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 62 :-
Development Phase 
expenditure-
already 
incurred 
funded by GHPL 
3.3 
billion 
0.756 
billion 
0.135 
billion 
0.040 billion 
4.2 
billion 
Total development 
and 
construction 
cost- to be funded 
through GIDC 
271 
billion 
30.513 
billion 
20.250 
billion 
75 billion 
396.7 
billion 
 
65. 
The Letter further states that a meeting was held in the 
Petroleum Division attended by relevant officers of Petroleum 
Division and Finance Division and the proposal for the way 
forward was that “the amount of GIDC (Rs. 295.403 billion) shall 
be utilized against projects to be submitted by Petroleum Division 
through budgetary mechanism in line with GIDC enactments.” 
This proposal was to be approved by ECC/Cabinet. This was the 
state of affairs on 18.02.2020, almost nine years after the levy of 
GIDC.  
66. 
Status of these projects has been attached with Letter dated 
11.02.2020 issued by the Interstate Gas Systems (Pvt) Ltd and 
filed in Court.25 The Project Brief on Turkmenistan-Afghanistan-
Pakistan-India (TAPI) Gas Pipeline Project does not mention about 
the actual development of the pipeline infrastructure in Pakistan or 
the date when supply of gas will be made available. And the Project 
Brief on Iran-Pakistan (IP) Gas Pipeline Project mentions that “the 
current status of the Project is that Pakistan’s contractual 
obligations are suspended under the Agreement, however, the 
legally binding agreement is still in place and the Government of 
Pakistan is still committed with the Project. The two sides have 
recently given themselves a further period of five years for the 
implementation of the Project by signing Amendment Agreement 
No. 3 of GSPA on 5th September, 2019.”  The details of the Projects 
as given by the Federal Government are as follows:- 
INTER STATE GAS SYSTEM (PVT.) LIMITED 
a. 
Turkmenistan – Afghanistan – Pakistan-India (TAPI) Pipeline Project 
Description 
USD 
PKR3 
Estimated Project Cost 
10,000 million 
1,500,000 million 
Pakistan share @ 5% equity share under 
Investment Agreement 
209.02 million 
31,353 million 
Development Phase expenditure-already 
 
 
                                       
25 Through CMA 1058/2020 in CA Nos. 11113 to 1155 /2017 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 63 :-
incurred 
Project development Cost – Paid by GoP through 
Supplementary Grant 
1.5 million 
153 million 
Project development cost – funding through 
GIDC 
4.1 million 
483 million 
Project development and operational 
expenditure – funded by GHPL 
4.02 million1 
603 million1 
Future development cost – to be incurred 
5 million2 
750 million2 
Future construction Cost – to be incurred 
194.4 million2 
29,160 million2 
Total development and construction cost – 
to be funded through GIDC 
203.42 million 30,513 million 
1 
The other development and operational costs were funded by GHPL, the parent company 
of ISGS, hence require replenishment from GIDC to settle the same with GHPL. 
2 
Development and construction expenditure are expected to be incurred in next 24 
months. 
3 
All amounts have been converted @ PKR 150/US$. 
________________________________________ 
INTER STATE GAS SYSTEM (PVT.) LIMITED 
b. 
Iran Pakistan (IP) Gas Pipeline Project: 
Description 
          USD 
         PKR3 
Estimated Project Cost 
1,806 million 
270,900 million 
Development 
Phase 
expenditure-already 
incurred 
 
 
Project development cost – funded from GIDC 
Nil 
Nil 
Project development and operational cost –  
Funded by GHPL 
22.06 million1 
3,300 million1 
Development cost – to be incurred 
5 million2 
750 million2 
Construction Cost – to be incurred 
1.779 million2 
266,850 
million2 
Total development and construction cost –  
to be funded through GIDC 
1,806.06 
million 
270,900 
million 
1 
The project development and operation costs were funded by Government Holding 
Private Limited (GHPL), the parent company of ISGS, hence require replenishment from 
GIDC to settle the same with GHPL. 
2 
Construction of the project will take 36 months after awards of construction contract, 
subject to easement of International sanctions on Iran. 
3 
All amounts have been converted @ PKR 150/US$. 
___________________________________________________ 
INTER STATE GAS SYSTEM (PVT.) LIMITED 
c. North South Gas Pipeline Project (NSGP) 
Description 
USD 
PKR3 
Estimated Project Cost 
2,700 million 
405,000 million 
Pakistan share of Cost  @ 5% equity share  
135 million 
20,250 million 
Development 
Phase 
expenditure-already 
incurred 
 
 
Project development cost – funded from 
GIDC 
Nil 
Nil 
Project development and operational Cost – 
funded by GHPL 
0.9 million1 
135 million1 
Future development cost – to be incurred 
4 million 
600 million 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 64 :-
Future construction cost – to be incurred 
130.1 million 
19,515 million 
Total development and construction cost – 
to be funded through GIDC 
135 million2 
20,250 
million2 
1 The other development and operational costs were funded by GHPL, the parent company 
of ISGS, hence require replenishment from GIDC to settle the same with GHPL. 
2 Development and construction expenditure are expected to be incurred in next 2 to 3 
years. 
3 All amounts have been converted @ PKR 150/US$. 
___________________________________________________ 
 
INTER STATE GAS SYSTEM (PVT.) LIMITED 
d. 
Underground Gas Storages 
Description 
USD 
PKR3 
Estimated Project Cost 
500 million 
75,000 million 
Development 
Phase 
expenditure-already 
incurred 
 
 
Project development cost – funded from 
GIDC 
Nil 
Nil 
Project development and operational Cost – 
funded by GHPL 
0.27 million1 
40 million1 
Future development cost – to be incurred 
3 million 
450 million 
Future construction cost – to be incurred 
497 million 
74,550 million 
Total development and construction cost – 
to be funded through GIDC 
500 million2 
75,000 
million2 
1 
he other development and operational costs were funded by GHPL, the parent company 
of ISGS, hence require replenishment from GIDC to settle the same with GHPL. 
2 
evelopment and construction expenditure are expected to be incurred in next 2 to 3 
years. 
3 
ll amounts have been converted @ PKR 150/US$. 
 
___________________________________________________ 
67. 
The above record undisputedly reveals that no development 
phase expenditure has taken place and that project development 
cost funded by GIDC is Nil.26 Even though, there is nothing on the 
ground, these projects were announced in 2011 and GIDC is since 
then being collected. The representatives of the concerned 
Ministries were at sea when asked to give a definite timeline for the 
service in return.  
-Position of the Projects in the Pakistan Economic Survey  
                                       
26 except the initial payment made in TAPI 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 65 :-
68.  The Pakistan Economic Survey 2014-1527 mentioned that 
the Government is taking steps to overcome the shortfall of natural 
gas by, inter alia, importing natural gas from Iran and 
Turkmenistan. It further provides as follows; 
The two transnational gas pipelines that Pakistan has 
pursued for over two decades have been delayed due to 
reasons beyond control. The 750 MMCFD Iran-Pakistan 
(IP) gas pipeline has been delayed due to international 
sanctions (although there is hope for removal of the 
sanctions) and 
the 
1,325 
MMCFD 
Turkmenistan-
Afghanistan-Pakistan-India (TAPI) pipeline has been 
delayed due to the security situation in Afghanistan 
and structural issues with project transaction.   
The Government of Pakistan is now successful to 
import 500 million cubic feet per day (mmcfd) of LNG 
from Qatar. 
The same Survey (2014-15)28 further states: 
During the recent visit of the Prime Minister to 
Turkmenistan….the 
review 
of 
Turkmenistan-
Afghanistan-Pakistan-India (TAPI) pipeline and energy 
security remained main focus of the meeting. The 
project is expected to be materialized by end of 2017 
will be providing the gas of 1.3 billion cubic feet to 
Pakistan. 
69. 
There is no mention of IP or TAPI pipeline projects in the 
Pakistan Economic Surveys of 2015-16, 2016-17, 2017-18, 2018-
19 and 2019-20. And Chapter-14 on “Energy” in the latest 
Pakistan Economic Survey 2019-20   states as follows29:  
Pakistan is successfully overcoming energy crisis, which 
has direct and indirect impact on all sectors of the 
economy. Presently, Energy Sector is confronted with 
demand supply gap….in terms of energy-mix, Pakistan’s 
reliance on thermal which includes imported coal, local 
coal and RLNG and natural gas has been decreasing over 
the last few years. Pakistan’s dependence on natural 
gas in the overall energy mix is on decline and the 
reduction of its share in the energy mix may be 
attributed to declining natural gas reserves as well as to 
the introduction of LNG since 2015.  
Gas Sector 
Natural Gas is a clean, safe, efficient and environment 
friendly fuel. Its indigenous supplies contribute about 38 
percent in total primary energy supply mix of the country.  
Pakistan produces around four (4) Billion Cubic Feet Per 
Day 
(Bcfd) 
of 
indigenous 
natural 
gas 
against 
an 
unconstrained demand of over six (6) Bcfd. To meet the 
shortfall, the GoP has initiated the import of LNG.  
(emphasis supplied)  
                                       
27 pp. 241 & 242. 
28 P. 236 
29 pp. 273 & 276 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 66 :-
70. 
Pakistan Economic Survey is silent regarding these projects 
since 2015 and shows that the shortfall in natural gas is being 
successfully 
plugged 
through 
the 
import 
of 
LNG, 
which 
surprisingly, is not a GIDC funded Project. The above documents 
show that after a decade of charging GIDC from gas consumers 
and after having collected Rs 295.40 billion to-date there is no sign 
of development of the gas pipeline projects in Pakistan. Absence of 
the said projects and emphasis on the import of LNG in the latest 
Pakistan Economic Survey hazards a guess that the Government of 
Pakistan is either not willing to or is unable to complete these 
projects and therefore the shortfall in gas supply is being 
increasingly plugged through LNG imported from Qatar.    
- Annual Reporting to the Parliament under section 4(2) of the Act & 
Parliamentary Practice. 
71. 
The Act, in its wisdom, considering the long-term nature of 
the infrastructure development gas pipeline projects required the 
Federal Government to inform both the Houses of the Parliament 
regarding the utilization of GIDC by tabling an Annual Report 
under Section 4 (2) of the Act, which provides as follows: 
The annual report in respect of the utilization of the 
cess shall be laid before the both houses of Majlis-e-
Shoora (Parliament) after three months at the end of 
each fiscal year. 
72. 
This is the closest the Act came to realizing that the levy of 
Fee is not contemporaneous and entails a time-lag and therefore 
requires a Parliamentary oversight on the utilization of GIDC. This 
was to ensure that the Government delivers the promised service of 
continuous and increased gas supply, to the gas consumers, at the 
earliest and also to check that the funds collected are earmarked 
and utilized for these projects only. It is an admitted position that 
not a single Annual Report was tabled before the Houses of the 
Parliament except the one placed before the Parliament on 
30.06.2019 after the filing of these cases. The Government has 
unabashedly and successively hoodwinked the Parliamentary 
oversight, paying little heed to the Energy crisis in the country; the 
interest of the gas consumers who have been regularly paying 
GIDC and the welfare of the general public. More disturbingly, the 
Parliament itself, inspite of acute Energy crisis in the country, 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 67 :-
never took the Federal Government to task and allowed a decade to 
pass by. The Executive and the Legislature both have failed the 
appellants and public expectations besides wasting valuable time 
and opportunity to utilize and divert the money collected to some 
other projects to alleviate the gas shortage in the country. I 
completely disagree with Majority View that the Executive has not 
been at fault. Had the Executive apprised the Parliament under the 
Act, legislative intervention may have followed, saving everyone 
this long drawn litigation and better financial management and 
use of Rs.295 Billion, which is sitting unused with the Federal 
Government.30 
73. 
According to the legislative design behind section 4(2) of the 
Act, these Annual Reports would have disclosed the status of the 
projects and their funding to the Parliament. In case of inordinate 
delay or non-development of the projects the Parliament could take 
appropriate action. Under the Rules of Procedure and Conduct of 
Business of the National Assembly, 2007 (“Rules”) these Annual 
Reports under section 4(2) of the Act would stand referred to a 
Standing Committee concerned under Rule 181 read with Rules 
198, 201 and 235 of the Rules. The Rules provide that the 
Standing Committees can examine the expenditure, administration 
and policies of the Ministry concerned and may forward its report 
of findings and recommendations to the Ministry to submit its 
reply to the Committee. This never happened as the Government 
admittedly failed to submit Annual Report regarding GIDC and the 
Projects to the Parliament. Timely interference by the Parliament 
would have borne different results. 
74. 
It might not be out of place to mention that Parliament today 
has become more and more a multi-functional institution 
performing variety of roles. Some of the cardinal roles and 
functions of the Parliament are: Legislation, Oversight of the 
Government 
actions 
and 
Financial 
Accountability 
of 
the 
Government and the public sector. Parliament makes laws, 
authorizes the Government to spend public money, scrutinizes the 
Government activities and is a forum for debate on national issues.  
                                       
30 Subject to some payments made as indicated above. 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 68 :-
75. 
The worst thing that the Government in a parliamentary 
system can do is to deny information to the Parliament. The 
Executive is answerable to the Parliament. Article 91(6) of the 
Constitution declares it in unequivocal terms that the Cabinet, 
together with the Ministers of State, shall be collectively 
responsible to the Senate and the National Assembly. It is the 
function of Parliament to exercise political and financial control 
over the Executive. To call for information is perhaps the greatest 
power of Parliament. Even otherwise, it is the duty of the 
Government itself to feed Parliament with information, which is 
full, truthful, precise and supplied in time. This is seen by 
Ministers making statements on the floor of the House, laying 
reports and papers on the Table of the House. All these constitute 
a wealth of information, which becomes immediately public and 
can be issued to raise discussion in the House.31   Nothing of the 
sort took place in the Parliament on GIDC and almost ten years 
passed without a whimper. This failure on the part of the two 
prime institutions of the country reflects poor governance and 
unsatisfactory performance of their constitutional duties, to say 
the least. 
Timeline – essential requirement for quid pro quo 
76. 
I now re-visit the constitutional concept of Fee, a levy which 
appears as “Fee for any service rendered” in Articles 72(3)(a), 
115(3)(a), 165(3) and as “Fee” in Articles 203B(c), 270AA(7), 279 
and item nos. 54 and 15 of Parts I and II of the Federal Legislative 
List, respectively.  In the present case, Fee is being charged as a 
tool of public finance for raising funds for the infrastructure 
development of gas projects, with the corresponding service of 
continuous and increased supply of natural gas for the gas 
consumers, to meet the energy shortfall in the country. It is 
axiomatic that, in this case, service rendered in return or quid pro 
quo will materialize after the gas pipeline projects are set up, hence 
the service will be rendered after a time-lag and will therefore be a 
future service.   
77. 
It is jurisprudentially settled that the concept of Fee, as 
opposed to Tax, is premised on a service in return or quid pro quo. 
                                       
31 Subhash C Kashyap, Parliamentary Procedure. Universal. 2006 pp. 19, 23 & 25 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 69 :-
This essential constituent of Fee needs further elaboration in the 
backdrop of the present case. Examination of the existing 
jurisprudence shows that courts have over time laboured to 
determine whether in a particular case there existed a service in 
return in order to justify the levy as a Fee as opposed to a Tax. The 
question never arose regarding the actual delivery of the service, 
perhaps for the reason that in most of the cases either the service 
was available or was easily made available in short span of time, so 
the payer never had a concern regarding the actual delivery of the 
service. This dimension of time has not come up for discussion in 
the existing jurisprudence or writings on “Tax vs Fee” in any detail. 
The facts of the present case have prompted me to consider the 
time dimension of service to be rendered in return for the payment 
of a Fee. It cannot be denied that words and phrases take colour, 
shape and character in a context and mean differently in different 
contexts. It is worthwhile to remember that there is a living content 
behind words and phrases, which breathes, and so, expands and 
contracts with changing times. 
78. 
The staggering facts of this case beg the question whether 
the fundamental constituent of Fee i.e., service in return or quid 
pro quo or future service should have a certain timeline?  Service in 
return or quid pro quo seems to exist at two levels. First, at the 
theoretical level - the examination of the legislative design should 
show that there is a quid pro quo or service to be rendered in 
return for the Fee. Second, at the applied level - this deals with the 
actual delivery of the service or a definite timeline for the delivery 
of future service. The legitimization of Fee requires the existence of 
service at both the levels: theoretical, as well as, applied. It will be 
absurd and illogical to conceive that a payer of Fee, who is subject 
to compulsory exaction of money by the State, is left to grope in the 
dark, guessing when the promised service is to be rendered. Fee is 
a constitutional levy against a service rendered, which cannot be 
structured on assumptions, suppositions, expectations and verbal 
commitments of the Executive but require a clear, crisp and 
certain statutory timeline. For the Fee to have a constitutional 
existence, the service to be rendered in return or the quid pro quo 
must be certain, clear, unambiguous and within a definite time-
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 70 :-
frame. Durrani Ceramics settles the case at the theoretical level 
only. The case did not touch the applied level, because the facts of 
the case in the year 2014 did not necessitate the examination of 
this aspect, as the Court and the parties assumed at that time that 
the service would be rendered in a reasonable period of time.  
79. 
The underlying theme of a Fee is based on relationship of 
reciprocity and mutuality- the quid pro quo. The legislation that 
imposes a Fee must cater for this reciprocity and guard this 
relationship premised on quid pro quo. While there is an obligation 
of the payer to deposit Fee on time which is subject to a surcharge 
for late payment, there must also be a corresponding obligation on 
the State or the authority responsible to provide the service in 
return, to do the same within a definite timeline. Without this 
corresponding obligation, the legislation fails to recognize the core 
ingredient of a Fee – the quid pro quo. It is by all means a legitimate 
expectation of the payer of Fee to know when will the service be 
delivered. His rights to property, trade and business under the 
Constitution require it. The payment of Fee by the payer cannot be 
towards a service that floats in a timeless zone; is open-ended and 
uncertain. Any service to be rendered in such like cases becomes a 
disservice. The relationship in a Fee must exist till the end. Failure 
in providing future service within reasonable timeline, deprives the 
Fee of its essential character, sheds its complexion as a Fee and 
gives that of a Tax, as such failure and the uncertainty of time 
diminishes the requisite degree of correlation between the payment 
of Fee and provision of service in return. This indefiniteness 
negates the concept of Fee and partakes the character of a Tax. 
Therefore, service against a Fee is not simply a theoretical 
recognition of the service to be rendered but must also have 
certainty in its applied form i.e., the timeline for the actual 
delivery.  The theoretical and applied constituents of the levy must 
exist in the legislative design, for the levy to stand as a Fee under 
the Constitution otherwise it passes for a Tax.  
80. 
The Act is silent on these counts and therefore passes for 
colourable legislation as it actually imposes a levy unknown to the 
constitution in the garb of a Fee. The Act does not provide a level-
playing field for the parties and is devoid of the basic fairness, 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 71 :-
protection and due process that is required to be meted out to a 
payer who is the source of the public finance required for funding 
these long-term gas projects. Such a law offends and renders 
constitutional protections of right to property, business and non-
discrimination, absolutely hollow and meaningless.   
81. 
This unexpected delay and uncertainty in the supply of gas 
(service to be rendered or quid pro quo) is both a Legislative and an 
Executive failure. The Federal Government should have tabled 
Annual Reports before both the Houses of the Parliament under 
section 4(2) of the Act and apprised the Parliament of the delay and 
its reasons or furnished a timeline for the completion of these 
projects. Irrespective of these responsibilities, Executive is there 
only to implement the law and if the law is silent regarding the 
timeline of delivery of service, the Executive carries no obligation to 
provide the service, except an expectation or assumption of a 
reasonable time, which is not actionable under the law, as the law 
envisages no penalty for such an omission. There is even no 
penalty for not tabling the Annual Reports before the Parliament by 
the Executive. In the absence of any statutory obligation and 
corresponding penalty, the real failure is of the legislative design.      
-nature of fiscal statute 
82. 
The above discussion becomes more nuanced when 
considered in the backdrop of a fiscal statute. The principles of 
interpretation of a fiscal statute apply equally to a Fee as they do 
to a Tax - both being compulsory exactions of money by the State. 
It was expressed by Rowlatt J. in Cape Brandy Syndicate v. IRC32 
that ‘in a taxing statute, one has to look at what is clearly said. 
There is no room for any intendment. There is no equity about a 
tax. There is no presumption as to a tax. Nothing is to be read in, 
nothing is to be implied. One can look fairly at the language 
used33.’ It is settled that interpreting a taxing statute, equitable 
                                       
32 Cape Brandy Syndicate vs. IRC ([1921] 1KB 64). 
33 Pakistan Television Corporation Limited vs. Commissioner Inland Revenue 
(Legal), LTU, Islamabad and others (2017 SCMR 1136), Commissioner of Income 
Tax and another vs. Baluchistan Concrete and Block Works Ltd. and others 
(2017 SCMR 1), Chairman, Federal Board of Revenue, Islamabad vs. Al-
Technique Corporation of Pakistan Ltd. and others (PLD 2017 SC 99), 
Commissioner of Income Tax Legal Division, Lahore and others v. Khurshid 
Ahmad and others (PLD 2016 SC 545), Zila Council Jehlum through District 
Coordination Officer vs. Pakistan Tobacco Company Ltd. and others (PLD 2016 
SC 398).  
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 72 :-
consideration are entirely out of place. Nor can taxing statute be 
interpreted on any presumptions or assumptions. The court must 
look squarely at the words of the statute and interpret them. The 
court cannot imply anything that is not expressed, it cannot 
import provisions in the statutes so as to supply an assumed 
deficiency.34 A taxing statues, if it professes to impose a charge, its 
intention 
must 
be 
expressed 
in 
clear, 
unequivocal 
and 
unambiguous language. A hunt into the intention to find a charge 
is impermissible. No equitable construction of a charging section is 
to be applied. The charging section is to be construed strictly 
regardless of its consequences that may appear to the judicial 
mind to be. It is not the function of the court to hunt out 
ambiguities 
by 
strained 
and 
unnatural 
meaning.35 
Fiscal 
legislation requires that any law that levies a Fee must first 
unambiguously and clearly spell out the nature of the service to be 
rendered in return (quid pro quo) and then provide for a reasonable 
and definite timeline for the delivery of such service. The 
legislature must also consider the entire mechanism at work 
behind this relationship of reciprocity – for example, the 
obligations of the provider of Fee, the consequences of delay and 
failure to render service including refund.    
- Our Constitution and the living tree doctrine 
83. 
I know that the Constitution is organic and a living 
testament of the aspirations of the people it governs. The “living 
tree” doctrine36 allows the Constitution to change and evolve over 
time while still acknowledging its original intentions. The doctrine 
achieves a balance between two seemingly contradictory goals: 
predictability and flexibility.  To be effective, the Constitution must 
                                       
34 Bechu Company vs. Assistant Commissioner. (2003 STC (132) 68) (also See N.S. Bindra’s – 
Interpretation of Statutes. p.863 (12th Edition). 
35 Film Exhibiter’s Guild vs. State of Andhra Pardesh (AIR 1987 AP 110) (also See N.S. Bindra’s 
– Interpretation of Statutes. p.863-864 (12th Edition). 
36 The Living Tree doctrine was first conceived of in a 1929 decision, Edwards vs 
Canada otherwise known as the ‘Persons Case’, issued by the Canada’s highest 
court at the time, the Judicial Committee of the Privy Council (JCPC) in Britain. 
After analyzing the Constitution’s use of the term ‘persons’, which had always 
referred to men, the JCPC decided that both men and women were now 
‘persons’, and therefore could be equally called to sit in the Canadian senate. 
According to the historically celebrated words of Justice Sankey, while 
constitutional stability and integrity are of crucial importance, the Constitution 
‘also planted in Canada a living tree capable of growth and expansion within its 
natural limits’. Women may not have been able to vote or hold office in 1867, 
but times had changed and so had to change constitutional interpretation: the 
decision led women to gain a measure of equality to men in the political arena36.  
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 73 :-
consist of a predictable set of rules. On the other hand, flexible 
interpretation accommodates the realities of changing modern life.  
If the Constitution could not be interpreted this way, it would be 
frozen in time and become more obsolete than useful. Therefore, 
contemporary interpreters must focus on what the originators 
intended it to accomplish rather than what the text actually states 
before allowing the Constitution to evolve or remain unchanged.37 I 
know that stability without change is degeneration. Change 
without stability is anarchy. The role of a judge is to help bridge 
the gap between the needs of the society and the law without 
allowing the legal system to degenerate or collapse into anarchy. 
The judge must ensure stability with change, and change with 
stability. Like the eagle in the sky, which maintains its stability 
only when it is moving, so too is the law stable only when it is 
moving. The life of law is complex. It is not mere logic. It is not 
mere experience. It is both logic and experience together.38 As 
Roscoe Pound said “the law must be stable, yet it cannot stand 
still.”39 Progressive interpretation is to preserve the vitality of the 
constitution: unless interpreted in this way, it would be frozen in 
time and become more obsolete than useful. Our courts have 
repeatedly underlined that our Constitution is a living document 
and encouraged its progressive interpretation.40 Therefore, the 
word “Fee” and the phrase “service rendered in return” or “quid pro 
quo” must also evolve to meet the new fiscal realities of the State. 
Fee, therefore, under the Constitution today would mean a fiscal 
levy that clearly and unambiguously describes the service rendered 
in return, so that Courts don’t have to unnecessarily hunt the 
meaning and nature of the levy in the letter of the law. Secondly, 
                                       
37 Living Tree Doctrine, Centre for Constitutional Studies.  Also see: Edwards vs. Canada 
(Attorney General) (1930 AC 124) and Reference Re Same Sex Marriage, (2004 SCC 79) 
(CanLII)[Same-Sex] 
38 Barak, The Judge in Democracy.  Princeton University Press. 2006 
39 “Hence all thinking about law has struggled to reconcile the conflicting demands of the need to 
stability and of the need of change. Law must be stable and yet it cannot stand still.” 
Interpretations of Legal History 1 (1923)  
40 Sindh Revenue Board through Chairman Government of Sindh and another vs. The Civil 
Aviation Authority of Pakistan through Airport Manager (2017 SCMR 1344), Lahore 
Development Authority through D.G. and others vs. Ms. Imrana Tiwana and others (2015 SCMR 
1739), Province of Sindh through Chief Secretary and others vs. M.Q.M. through Deputy 
Convener and others (PLD 2014 SC 531), Reference by the President of Pakistan under Article 
186 of the Constitution of Islamic Republic of Pakistan, 1973 (PLD 2013 SC 279); Rana Aamer 
Raza Ashfaq and another vs. Dr. Minhaj Ahmad Khan and another (2012 SCMR 6); Al-Raham 
Travels and Tours (Pvt) Ltd and others vs. Ministry of Religious Affairs, Hajj, Zakat and Ushr 
through Secretary and others (2011 SCMR 1621), Arshad Mehmood and Others vs. Government 
of Punjab through Secretary, Transport Civil Secretariat, Lahore and others (PLD 2005 SC 193);  
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 74 :-
the reciprocal service to be rendered in return or the quid pro quo 
must be structured to have a reasonably certain and definite 
timeline. If the constituent of time is missing (the applied part), the 
service becomes practically non-existent and the levy no more 
retains the character of Fee and becomes a Tax rendering the levy 
unconstitutional.    
Distinguishing Durrani Ceramics   
84. 
The factual matrix of the instant case is very different from 
that of Durrani Ceramics. It is settled law that if a new case is 
dissimilar to an earlier case in ways that seem important, the court 
will ‘distinguish” it and reach a result different from what the 
precedent would otherwise suggest or even dictate. In common 
parlance, either the precedent or the pending case may be said to 
be “distinguished” from the other.41 In this way, the former 
decision might be said to be “rerationalized42.”  A precedent, 
whether persuasive or binding, need not be applied or followed if it 
can be distinguished; that is, there is a material distinction 
between the facts of the precedent case and the case in question. 
According to Zander, ‘distinguishing between factual situations 
and applying the appropriate rule of law is one of the lawyer’s and 
judge’s most crucial functions.”43  The technique of distinguishing 
past case is a powerful engine of legal change.44 Distinguishing 
means that each case was decided correctly based solely on its own 
facts because the facts were materially different. Joseph Raz 
argues that the boundaries of distinguishing “are far from fixed,” 
he asserts that, the [boundaries] undergo continual change.”45 The 
crucial question is: Are there any material differences between the 
facts of the case at bar and the facts of the prior cases to warrant 
the rule being different? In principle, the distinguishing of an 
apparent decision presents no problem for the doctrine of 
precedent.46 The facts of this case, showing that the gas projects 
have not even started for almost a decade yet the Fee is being 
constantly charged since 2011 present us with new facts that were 
                                       
41 Bryan A Garner. The Law of Judicial Precedent, 2016  p.97 
42 Joseph Raz, The Authority of Law  186 (1979) 
43 Zander, The Law, p.270 (Also see Muhammad Munir, Precedent in Pakistan Law, Oxford, 
2014) 
44 Theodore, The Rule of Precedent, op cit. p. 99   
45 Raz, The Authority of Law, p. 185 
46 Muhammad Munir, Precedent in Pakistan Law, Oxford, 2014. P.219 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 75 :-
not so gravely present at the time of Durrani Ceramics, hence the 
said precedent is clearly distinguishable and stands on its own 
facts.   
Cess Rates- discriminatory  
85. 
The Act provides for the following rates for different 
Industrial Gas consumers:- 
SECOND SCHEDULE OF THE ACT 
S.No. 
Sector 
Maximum Rate of Cess 
(Rs./MMBTU) 
(1) 
(2) 
(3) 
1. 
Fertilizer-Feed (Old) 
300.00 
2. 
Fertilizer-Feed (New) 
300.00 
3. 
Fertilizer-Fuel 
150.00 
4. 
Captive Power 
200.00 
5. 
Industry 
100.00 
6. 
KESC/GENCO 
100.00 
7. 
IPPs 
100.00 
The purpose of the Act is to raise public finance for the 
infrastructure development of the gas projects mentioned in 
section 4 of the Act through levy of Fee on the above-mentioned 
gas consumers. There appears to be no intelligible differentia 
amongst the different gas consumers mentioned in the Schedule 
for the purposes of the Act.  One justification for charging different 
rates from amongst the industrial gas consumers could have been 
their overall consumption of natural gas.  The data provided by the 
latest Pakistan Energy Year Book 201847 shows as follows: 
Natural Gas Consumption by Sector 2017-2018 
 
Sr. No. 
Industry 
Consumption(%) 
Maximum Rate of Cess 
(Rs./MMBTU) 
1.   
Fertilizer 
(feedstock) 
12.49% 
300 
2.  
Fertilizer (fuel) 
4.57% 
150 
3.  
Power 
37.44% 
200 (captive power); 100 
(IPPs); 100 
(KESC/GENCO) 
4.  
Gen. Industry 
18.84% 
100 
5. 
Transport (CNG) 
4.84% 
263.56 (Region-1) and 
200 (Region-II) 
                                       
47 Issued by Ministry of Energy (Petroleum Division) and Hydrocarbon Development Institute of 
Pakistan. 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 76 :-
The above shows that the differentiation of rates is not based on 
the consumption pattern of the gas consumers. The rates of GIDC 
fixed 
for 
different 
gas 
consumers 
are, 
therefore, 
ex-facie 
discriminatory and cannot be allowed to stand.   
86. 
I, therefore, hold that any fiscal legislation that imposes a 
Fee, must clearly spell out the nature of service to be rendered and 
the reasonable timeline for the delivery of such service. The 
legislation (including subordinate legislation) must provide a 
complete mechanism including the consequences of stoppage of 
collection of Fee or extension of time or refund of Fee in case the 
project is delayed or cannot be executed in the proposed timeline, 
respectively. The legislation must safeguard and protect the 
reciprocity behind a Fee (unlike a tax) by providing corresponding 
obligations and duties on the parties to the levy.  The present Act 
does not meet this fundamental requirement of a Fee levying 
legislation, resulting in imposing an unconstitutional levy in the 
garb of a Fee. This unlawful exaction (levy) offends the rights to 
property, trade and non-discrimination of the appellants and is 
hereby declared to be unconstitutional and illegal in its present 
form.  
Refund of the amount collected 
87. 
As a consequence, the amount of GIDC collected over the 
years should be returned and refunded to the payers in full, unless 
in some cases, it is impractical to so do. The Federal Government 
shall constitute a Committee to work out a mechanism for refund 
of GIDC so that payers of GIDC are fully restituted; be it the gas 
consumers under the Act or the final consumers (people of 
Pakistan). Even if the gas consumers have passed on the Fee to its 
customers, technology may be available to credit such customers, 
so that there is no unjust enrichment on the part of the State. The 
amount of GIDC that cannot be refunded after exploring all other 
avenues, shall remain earmarked and be utilized only for the 
infrastructure development of the gas sector.   
 
 
 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 77 :-
Refund after Six Months 
88. 
I cannot lose sight of the fact that Energy is vital to 
industry, 
transport, 
infrastructure, 
information 
technology, 
agriculture, household users and more. Any nation with a growing 
economy and improving living standards must secure a robust 
energy supply. The future of economic development hinges on 
energy security. Shortage of natural gas in the country is still a 
reality and the Energy Sector is confronted with demand supply 
gap which needs to be filled up.  According to the latest Pakistan 
Economic Survey, 2019-20 the indigenous natural gas contributes 
around 38% in total primary energy supply mix of the country. 
Pakistan produces around 4 Billion Cubic Feet Per Day (Bcfd) 
against an unconstrained demand of 6 (Bcfd); the gas pipeline 
projects in question are based on bilateral and multilateral 
international agreements with other countries; a sum of Rs.295 
billion has been collected as GIDC for the last almost 10 years.  
Keeping these facts in mind, and especially the issue of energy 
security, in the larger national interest, I allow the Federal 
Government a period of six months to initiate appropriate 
legislation in the light of the principles settled in this judgment 
including a clear description of the services being rendered, 
provision of a reasonable timeline for the delivery of service (supply 
of natural gas) to the gas consumers and a statutory mechanism of 
obligations and consequences that may arise, if the service is 
delayed or is not delivered at all. In case the Federal Government 
fails to do so, it shall refund the amount of GIDC, in the manner 
mentioned above.  
89. 
These appeals are allowed in the above terms and the 
petitions are converted into appeals and also allowed.  
 
 
Islamabad, 
APPROVED FOR REPORTING 
Iqbal 
 
 
 
 
 
 
 
Judge 
 
 
Civil Appeals No.1113 to 1155 of 2017 etc. 
-: 78 :-
ORDER OF THE COURT 
 
 
 
By majority of two to one (Syed Mansoor Ali Shah, J 
dissenting), all these appeals and petitions are dismissed. In the 
light of this decision and the directions contained therein all listed 
applications also stand disposed of.   
 
JUDGE 
 
JUDGE 
 
JUDGE 
Islamabad, the 
13th of August, 2020