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P L D 1999 SC 1026

FEDERATION OF PAKISTAN AND OTHERS
V/S
SHAUKAT ALI MIAN AND OTHERS

Per Ajmal Mian C.J.

(a) Constitution of Pakistan (1973) Arts. 4 & 2A

Restriction on withdrawal of foreign exchange from foreign currency accounts by account holders—Vires of S. 2, Foreign Exchange )Temporary Restrictions) Act, 1998—Section 2 of the Act does not confer unbridled, arbitrary and unstructured powers on the functionaries of the State Bank of Pakistan and therefore, is not hit by the doctrine excessive delegation and is not ultra vires the Arts. 4 & 2A of the Constitution—Reasonable classification—Any circular which may be issued by the State Bank of Pakistan for granting permission to the foreign currency account holders to operate their foreign currency accounts, not founded on reasonable classification, will not be sustainable—Principles.Section 2 of the Foreign Exchange (Temporary Restriction) Act, 1998 does not confer unbridled, naked, arbitrary and unstructured powers on the functionaries of the State Bank of Pakistan and, therefore, it is not hit by the doctrine of excessive delegation and is not ultra vires the Articles 4 and 2A of the Constitution. No doubt, that no foreign currency account holder could operate foreign currency account without prior permission of the State Bank of Pakistan, but it is implied and inherent that such permission is to be granted on the basis of reasonable classification, which should be based on an intelligible differentia, which distinguishes person or companies that are grouped together from those who have been left out and that the differentia must have retional nexus to the object sought to be achieved by such classification.[p. 1057] W

Any circular which may be issued by the State Bank of Pakistan for granting permission to the foreign currency account holders to operate their foreign currency accounts, not founded on reasonable classification, will not be sustainable. In order to eliminate discrimination, non-resident Pakistani and foreginers, maintaining foreign currency accounts as on 28-5-1998, will be entitled to utilise the interest/profits payable to them under the arrangements between them and the bank concerned in any manner including the right to remit the same abroad. [p. 1057] X
(b) Constitution of Pakistan (1973) Art. 25
Equality of citizens—Discriminatory provision—Concept—Marked distinction exists between a provision of a statute which may ex facie, discriminatory and a provision thereof which may be capable of being pressed into service in discriminatory manner—Former provision would be liable to be struck down on the ground of violation of Art. 25 of the Constitution but the latter provision cannot be struck down on the ground that same was capable of being used in discriminatory manner—Any discriminatory action which may be taken pursuant to such provision can be struck down. [p.1057] Y
(c) Constitution of Pakistan (1973) Art. 25

Equality of citizens—Discriminatory provision—Provision of S. 2,Foreign Exchange (Temporary Restrictions) Act, 1998 is not ex facie discriminatory even though it may be capable of being used in a discriminatory manner. [p. 1058] Z
(d) Constitution of Pakistan (1973) Art. 141

A colourable legislation is that which is enacted by a Legislature which lacks the legislative power, or is subject to Constitutional prohibition, but it is framed in such a way that it may appear to be within the legislative power or to be free from Constitutional prohibition or where the object of the law is not what is contemplated under the Constitutional provision pursuant whereof it is framed. [p. 1059] AA
(e) Constitution of Pakistan (1973) Art. 141

Doctrine of colourable legislation—Provision of S. 2, Foreign Exchange (Temporary Restrictions) Act, 1998 is not hit by doctrine of colourable legislation. [p. 1059] BB

Constitutional Law of India, A Critical Commentary, 3rd Edn. by H.M. Seervai; Attorney-General of Albert V. Attorney-General of Canada and others AIR 1939 PC 53 and The State of Bihar V. Sir Kameshwar Singh AIR 1952 SC 252 ref.

(f) Constitution of Pakistan (1973) Art. 141

Protection of Economic Reforms Act (XII of 1962), Ss. (5)4 & 10— Constitution of Pakistan (1973), Art. 141—Parliament is competent to pass any law in the absence of any constraint contained in the Constitution— Contention that in view of the assurance contained in Ss. 5(4) & 10 of the Protection of Economic Reforms Act 1992, parliament was not competent to enact S. 2, Foreign Exchange (Temporary Restrictions) Act, 1998, was repelled. [p. 1059] CC

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