Table of Contents
Capital Development Authority (CDA) – Extractive Governance and Exploitation of the Public. 2
The Distinction Between a Tax and a Fee. 3
The Public Notice Requirement 4
The Root Cause: Centralized Bureaucracy and Overlapping Mandates. 4
Capital Development Authority (CDA) – Extractive Governance and Exploitation of the Public
Imagine driving into a newly developed commercial district to drop off a colleague or pick up coffee, only to be stopped by a toll collector demanding an “entry fee”, essentially a tax disguised as a fee, just for using the service road[1]. This is the reality for a large proportion of people living in Pakistan today.
In a constitutional democracy, public authorities exist to facilitate the citizens who fund them. Roadways, service lanes, and public parks are built with taxpayer money to enable commerce and transit. Yet across Pakistan, authorities such as the Capital Development Authority (CDA), Metropolitan Corporation Islamabad (MCI), and various provincial highway and municipal authorities view public infrastructure not as a necessity for the public to lead their lives, but rather as a cash generator.
When these charges are questioned in court, an age-old drama unfolds; authorities point fingers at one another, cite unpublished internal rules, and leave the public confused, trapped in a reality where no single entity is ever held accountable.
The New Blue Area Incident
A striking illustration of this administrative breakdown recently played out before the Islamabad High Court (IHC). A petition was filed challenging a Rs 100 fee collected from anyone entering the service road of New Blue Area, Islamabad’s most recent commercial hot spot housing corporate offices, shops, and restaurants. The ‘parking fee’ was levied regardless of whether the driver was parking or merely passing through. Therefore, InDrive drivers, or other cab-hailing service providers, as well as courier boys, were having to pay this fee, for merely entering the area and exiting within a matter of minutes.
When the court summoned municipal representatives to explain the legal authority behind this charge, a classic game of institutional tennis ensued.[2]
Counsel for the Metropolitan Corporation Islamabad (MCI) informed the court that MCI was not acting on its own whim but was merely collecting the fee under the “Parking Regulations 2023,” framed and approved by the CDA Board.[3]
Because MCI shifted responsibility to CDA’s policy, the High Court was forced to direct that CDA be formally added as a party to the lawsuit.[4]
The core legal justification presented by the authorities relied on the ‘PARKING REGULATIONS 2023’. However, these regulations were never published in the official public gazette or made accessible to the public prior to, or even after, enforcement. Upon further research, it appears that the regulations were indeed approved in 2023, as per the board meeting minutes of CDA, but it was never published on the authority’s website, which houses all its other rules and regulations, ranging back to the year of its inception.[5]
This litigation highlights a clear defect in Pakistani administrative governance. Two civic entities, one a municipal corporation, the other a development authority, operate in overlapping territorial jurisdictions. When grievances arise, each body points to the other. Meanwhile, private contractors continue collecting unwarranted fees at the site, drawing millions from citizens under the guise of “traffic management”, while no single authority accepts any responsibility.
The Distinction Between a Tax and a Fee
Under Article 77 of the Constitution of Pakistan, no tax can be levied except by or under the direct authority of an Act of Parliament or Provincial Assembly.[6] In the case Ch. BASHARAT ALI HANJRA and another versus CAPITAL DEVELOPMENT AUTHORITY (CDA), ISLAMABAD through its Chairman and others [PLJ 2025 ISLAMABAD 320][7], IHC established that CDA had absolutely no authority to impose any right of way charges, which is essentially what was being carried out in New Blue Area. It is further pointed out that prior government approval is also required for any such tax or fees to be levied, which seems to be sorely lacking in the case at hand.
Moreover, Pakistani legal jurisprudence draws a sharp distinction between a tax and a fee. As laid out in the landmark judgement of Federation of Pakistan versus Durrani Ceramics and others [2014 SCMR 1630][8], ‘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.’ The element of quid pro quo is also noted as being an essential part of a fee, where the people get some service in return for the money paid, as per the case Shell Pakistan Ltd versus CDA [2024 MLD 261][9].
Simply put, a tax is a general compulsory payment collected by the state for public revenue without the provision of a direct service in return, while a fee is a specific charge levied to cover the cost of a direct service, facility, or privilege provided specifically to the person paying it.
So the question is, when the CDA or MCI charges Rs 100 just to enter a service road, what direct service is being provided? The roads already exist, built with public funds. Charging citizens money simply to access public space is not a “fee” for a service, it is an unlegislated tax disguised as a parking charge.
The Public Notice Requirement
As per the Islamabad Capital Territory Local Government Act 2015 (ICTLGA 2015), every notification, regulation, or by-law proposing a tax, fee, or levy to be collected from the public must be published prior to enforcement, so as to attract and resolve any objections of the public.[10]
Enforcing parking or entry fees based solely on unpublished regulations, without any prior notification presenting the charge before the masses for objection violates the basic procedure provided and renders the collection legally void. This is further supported by the case MCI versus Chairman CDA [2021 PLD 144][11], which lays out the proper procedure to be followed in paragraphs 12, 27 and 28.
The Root Cause: Centralized Bureaucracy and Overlapping Mandates
The root cause behind this administrative exploitation lies in how civic authorities are structured. The board members of these development authorities, including CDA, are appointed bureaucrats instead of elected representatives answerable to locals. This then reflects in their priorities, which lean towards generating unprecedented levels of revenue despite what the public cost may be, rather than serving the masses.
Additionally, development authorities existing alongside local municipal corporations creates unnecessary confusion. When both claim jurisdiction over the same commercial roads, each uses the other as an excuse to dodge judicial action. At the end, nobody is held accountable, and the matter is, once again, swept under the rug.
The Remedy
To resolve this administrative confusion and protect the public from exploitation at the hands of authorities that have made a habit of over-stepping their mandate, stringent legal boundaries must be maintained.
CDA must be confined strictly to its core statutory mandate; master planning, urban development, and land management. It must cease acting as a municipal authority, given that those powers lie with the MCI since the body’s establishment in 2015, or passing “parking regulations” which are consequently used to extract money from the public, without any due notice or proper publication of the concerned regulations.
Courts must committedly strike down any such levy lacking explicit parliamentary authorization, that fails to provide a direct, measurable service (quid pro quo), declaring it to be an unconstitutional tax wearing the garb of a lawful fee.
Conclusion
The ongoing litigation over Islamabad’s New Blue Area entry fee is more than just a dispute over a 100 rupee fee. It is a voice being raised against a governance model where autonomous authorities overstep their statutory mandates and treat citizens as revenue targets.
The solution is easier than what one might expect; instead of creating a new legal system, the strict enforcement of existing administrative law and judicial guidelines will suffice perfectly. CDA must stay in its development lane while municipal entities must be kept in check to operate transparently. Enforcing mandatory public gazette notifications and prior public objection periods will restore accountability and ensure that resources intended for public use are never gatekept from the masses.
[1] MCI’s legal authority to collect Rs100 entry fee in New Blue Area challenged
[2] IHC summons MCI administrator over entry fee in New Blue Area
[3] Court directs CDA’s inclusion as respondent in plea against New Blue Area parking charges
[4] IHC issues notices to CDA in New Blue Area entry fee case
