Messrs UNIVERSAL BUSINESS EQUIPMENT (PVT.) LIMITED through Chief Executive VS DEPUTY COLLECTOR OF CUSTOMS, CUSTOMS HOUSE, KARACHI
2004 P T D 1944
[Karachi High Court]
Before Ata‑ur‑Rehman and Sarmad Jalal Osmany, JJ
Messrs UNIVERSAL BUSINESS EQUIPMENT (PVT.) LIMITED through Chief Executive
Versus
DEPUTY COLLECTOR OF CUSTOMS, CUSTOMS HOUSE, KARACHI and another
Spl. Custom Appeal No.26 of 2000, decided on /01/.
th
April, 2002. (a) Customs Act (IV of 1969)‑‑‑
‑‑‑‑S. 196‑‑‑Appeal‑‑‑Questions formulated being questions of fact related to issue, whether subject machines were in fact typewriter or type‑setting machines‑‑‑Order‑in‑original and appellate order had dealt with such aspect of matter by concluding that such machines could be used as type‑writer as well‑‑‑High Court dismissed appeal by, refusing to interfere in such matter.
(b) Limitation‑‑‑
‑‑‑‑ Issue of limitation could be agitated before any forum including Supreme Court, although same had not been agitated before any of lower Courts.
Messrs Faran Enterprises v. The Appellate Tribunal, Customs, Excise and Sales Tax 1999 CLC, 735 and Messrs Baba Khan v. Collector of Customs, Quetta 2000 SCMR 678 ref.
(c) Administration of Justice‑‑‑--
‑‑‑‑Legal issues, which are specifically not pleaded before any judicial forum, can be taken up and decided by higher forum, since a duty is cast upon such forum to take notice of such legal issues itself.
(d) Customs Act (IV of 1969)‑‑‑--
‑‑‑‑Ss. 32(2)(3) & 196‑‑Issuance of show‑cause notice ‑‑‑Limitation‑‑ Goods were released on 16‑7‑1987‑‑‑Show‑cause notice was issued on 4‑2‑1988‑‑‑Tribunal was of view that case of importer was not of intentional mis declaration or concealment of facts so as to attract provision of S.32(2) of Customs Act, 1969, rather same was a case falling under S.32(3) thereof‑‑‑High Court remanded case to Tribunal to consider, whether show‑cause notice issued on 4‑2‑1988 was within time or not.
Sattar Silat for Appellant.
Raja Muhammad Iqbal for Respondent.
Date of hearing: 4th April, 2002.
JUDGMENT
SARMAD JALAL OSMANY, J.‑‑‑The questions of law as raised in this appeal are as follows:‑‑
(1.1)Whether the respondent No.1 having physically not only examined the goods imported by the appellant but also having been satisfied though practical demonstration through the following observations as incorporated in the relevant file of the respondent bearing No.SI/Misc/610/87‑VI:‑‑
"Basically the work of the this apparatus is typesetting, therefore, it ought to be assessed under 874.34."
(Sd.)
D.C. 1,
. 15‑7‑1987"
The subsequent show‑cause notices, dated 4‑2‑1988 are maintainable? The Appellant respectfully prays for an answer in negative.
(1.2) Whether the respondent No.1 in view of the decision/order passed on 15‑7‑1987 has the jurisdiction to re open and/or review the order earlier passed in favour of the appellant. The appellant respectfully prays for an answer in negative.
(1.3) Whether the Hon'ble Tribunal having came to: the conclusion that there is a very thin line of demarcation between the machines that is typewriters falling under 'PCT Heading 84.51 and typesetting machines falling under PCT Heading 84.34 should have exercised the discretion in favour of the appellant based on the fundamental. principle of justice that in case of two interpretations the one going in favour of the taxpayer should have been adopted. The appellant respectfully prays for an answer in affirmative:
(1.4) Whether in view of the conclusion of the Hon'ble Tribunal that there is a very thin line of demarcation between the typewriters falling under PCT Heading 84.51 and type setting machines failing under PCT Heading 84.34 can the appellant be said to have submitted a false declaration to the respondents in terms of section 32 of the Customs Act, 1969? The appellant respectfully prays for an answer in negative.
(1.5) Whether for invoking the provisions of subsection 1 and subsection (2) of section 32 of the‑Customs Act, 1969, prima facie the element of mens rea that is a wilful and deliberate false declaration is necessary. The appellant respectfully prays for an answer in the affirmative:
(1.6) Whether as a result of the statement made by the appellant on the Bill of Entry amounts to an opinion of the appellant, which may or may not be accepted by the respondent? The appellant respectfully prays for an answer in the affirmative.
(1.7) If the answer to the above mentioned question is in affirmative whether as a result of the opinion of the appellant as stated in the Bill of Entry can be respondent invoke the provisions of subsections 1 and 2 of section 32 of the Customs Act, 1969 for the purpose of, issuance of the show‑cause notice to the appellant. The appellant respectfully prays for an answer in the negative.
After having heard both the learned counsel we are of the view that Questions Nos. 1.1, 1.2, 1.3, 1.6 and 1.7 are basically questions of fact relating to the issue whether the machines, which are the bone of contention between the parties are in fact typewriters or typesetting 'machines. As' both the order‑in‑original as, well as the appellate order' have dealt with this aspect of the matter and have reached the conclusion that in fact these machines can be used as typewriters as well, we are not inclined to interfere in the matter. We would, accordingly, dismiss this Appeal insofar as these questions are, concerned.
However, as far as the Questions No. 1.4 and 1.5 are concerned, these raise issue of limitation with regard to the show‑cause notices served upon the appellants by the Department under section 32(2) of the Customs Act. Per learned counsel for the appellant in view of final observation made it, the impugned order to the effect that there is a very thin line of demarcation between the two types of machines in question viz., typewriting and typesetting, the personal penalty, imposed upon the‑appellant was remitted, therefore there could not be any question of menu rea on the part of the appellant. Hence, the provisions of section 32(2) of the Customs Act would not be attracted. In the opinion of the learned counsel, in view of such observations, by the learned Tribunal, the more appropriate section would be 32(3) of the Customs Act; which provides for re-opening of those cases whereby reason of any inadvertence; error, or misconstruction, any duty or charge has not been levied or has been short‑levied or has been erroneously refunded for which the time limitation to issue the show‑cause notice was then six months (now three years as amended by the Finance Ordinance, 2000). In view of the above stated position learned counsel has therefore, submitted that those show‑cause notices in which the goods were released after finalizing all the payments on 16‑7‑1987 are patently time‑barred since these notices were issued on 4‑2‑1988, which is beyond the period of six months prescribed by section 32(3) in its un‑amended form. Consequently, learned counsel has prayed that the impugned order be set aside inasmuch as the following consignments are concerned:‑‑
| Importer | Model No | Date of Index Arrival of the consignment vide IGM No. | No. of Pill of entry A/W date of payment of taxes |
| 1. Silver Reed Int. | EZ‑50 | 12256/87 25‑6‑1987 | 113 | DA1206 16‑7‑1987 |
| 2.Silver Reed Int. | EX‑300 | 1483/87 30‑6‑1987 | 67 | C‑5780 |
| 4. Universal Business Equipment Ltd. | EZ‑45 | 1256/87 26‑6‑1987 | 109 | DA‑1207 16‑7‑1987 |
| 5. Universal Busi‑ ness Equipment | EZ‑50 | 1256/87 25‑6‑1987 | 108 | DA‑1207 16‑7‑1987 |
On the other hand Mr. Raja Muhammad Iqbal learned counsel for the respondent has submitted that in terms of section 196 of the Customs Act only legal issues arising out of the Tribunal can be referred to this court and since no such issue of limitation was either presented before the Tribunal or argued before it, therefore, this issue cannot be examined by this Court. In support of his submissions learned counsel has relied upon Messrs Faran Enterprises v. The Appellate Tribunal, Customs, Excise and Sales Tax (1999 CLC 735) and Messrs Baba Khan v. Collector of Customs, Quetta (2000 SCMR 678).
We have heard both the learned counsel and our conclusions are as follows:‑‑
It would, be seen that as per well‑settled law right up to the Honourable Supreme Court the issue of limitation can be agitated before any forum including the Honourable Supreme Court although it has not been agitated before any of the lower Courts. This principle of law is sod well‑settled that no reference need be made to the decided cases. Further, it is also well‑settled that legal issues, which are specifically not pleaded before any judicial forum have to be taken up and decided by that forum since a duty is cast upon such forum to take notice of such C legal issues themselves. In the present case, it does not appear that the learned Tribunal considered the issue of limitation. However, upon reading of the last para. of the impugned order, it appears that the learned Tribunal was of the opinion that perhaps this was not a case of misdeclaration or concealment of facts intentionally so as to attract the penal provision of section 32(2) but rather a case falling under section 32(3) of the Customs Act. In such view of the matter in our opinion the matter is to be remanded back to the learned Tribunal to consider whether the show‑cause notice issued on 4‑2‑1988 insofar as the consignments mentioned above are within time or not. Order accordingly.
As regards the other consignments in question learned counsel for the appellant has conceded that the show‑cause notice would be within time since these were cleared on 31‑8‑1987. As far as the cases cited by the learned counsel for the respondent are concerned, we are of the opinion that these would not apply to the facts of the present case since therein the Honourable Supreme Court and a Division Bench of this Court came to the conclusion that it was a willful misdeclaration on the part of the appellant/Importer, which should be visited with penal consequences. We have already observed that in view of the learned Tribunal's order, this does not appear to be so in which event penal consequences may not result in terms of section 32(2) of the Customs Act. The learned Tribunal shall be at liberty to form its own views regarding limitation without being influenced by this order.
S.A.K./U‑1/KCase remanded.