COLLECTOR OF CUSTOMS and another VS TARIQ SULTAN AND COMPANY and another
2004 P T D 1929
[Supreme Court of Pakistan]
Present: Nazim Hussain Siddiqui, CJ., Javed Iqbal and Abdul Hameed Dogar, JJ
COLLECTOR OF CUSTOMS and another
Versus
TARIQ SULTAN AND COMPANY and another
Civil Appeals Nos.1804 and 163/K OF 1997, decided on /01/.
st
April, 2004. (On appeal from the judgment of the High Court of Balochistan, Quetta, dated 8‑5‑1997 passed in C.P. No.290 of 1996).
(a) Customs Act (IV of 1969)‑‑‑
‑‑‑S.30‑‑‑Central Excise Act (I of 1944), S.3(c)‑‑‑Central Excise Rules, 1944, R.96 ZZ‑‑‑Notification S.R.O. No. 457(1)/96, dated 13‑6‑1996‑‑ onstitution of Pakistan (1973), Art. 185(3)‑‑‑Leave to appeal was ranted by Supreme Court to consider; whether central excise duty case of ship breaking was to be recovered as customs duty under S.30 of Customs Act, 1969, with reference to the date of entry was filed and whether benefit of Notification S.R.O. No.457(1)/96, dated 13‑6-1996, could be availed by the respondents, and whether the value was to be determined in the instant case with reference to S. 3(c) of Central Excises Act; 1944, and as such, R. 96 ZZ of Central Excise Rules, 1944, did not apply.
(b) Customs Act ‑(IV of 1969)‑‑‑
‑‑‑‑S. 30‑‑‑Central Excises Act (I of 1944), S.3(c)‑‑‑Central Excise Rules, R.96 ZZ‑‑‑Notification S.R.O. No. 457(1)/96, dated 13‑6‑1996‑‑ Central Excise duty, recovery of‑‑‑Levy of such duty‑‑‑Crucial date‑‑ Bill of entry was filed on 9‑6‑1996 and the Notification S.R.O. No.457(1)/96, dated 13‑6‑1996; was made applicable with effect from 1‑7‑‑1996‑‑‑Plea raised by the authorities was that duty was to be levied on the date on which the bill of entry was filed‑‑‑Validity‑‑ Counsel for the authorities admitted that Notification S.R.O. No.457(1)/96, dated 13‑6‑1996, was never withdrawn‑‑‑In view of such admission, the date of bill of entry would be immaterial‑‑‑Had the S.R.O. in question been withdrawn, only then the date of bill of entry had been material‑‑‑Exemption having been granted by means of S.R.O. No. 457(1)/96, dated 13‑6‑1996, which was intact, same could be availed by the respondents‑‑‑Other duties/taxes which were not included in the S.R.O. in question regarding which no exemption was granted could be recovered from the respondent in accordance with law‑‑‑Judgment passed by High Court being well‑based did not warrant interference by Supreme Court‑‑‑Appeal was dismissed.
Federation of Pakistan, through Ministry of Finance and others v. Noorie Trading Corporation (Pvt.) Limited and others (1992 SCMR 710) and Federation of Pakistan and others v. Amjad Hussain Dilwari and 2 others (1992 SCMR 1270) distinguished.
(c) Constitution of Pakistan (1973)‑‑‑--
‑‑‑‑Art. 185(3)‑‑‑Appeal to Supreme Court ‑‑‑Expunction of remarks‑‑ Misuse of authority‑‑‑High Court, while accepting the Constitutional petition filed by importer had made certain remarks against the Customs official‑‑‑Plea raised by the official was that the remarks were uncalled for‑‑‑Validity‑‑‑Customs official had acted whimsically, arbitrarily and had misused his authority by deducting duties/taxes in a fraudulent manner which was apparent on record and had rightly been taken notice of in the judgment passed by High Court‑‑‑No illegality or irregularity had been committed by passing the remarks which were in consonance with record‑‑‑Supreme Court directed the Central Board of Revenue to take action pursuant to the observations as made by High Court‑‑ Question raised by the official might be a question of personal grievance but no question of law of public importance was involved in matter‑‑‑, Leave to appeal was refused.
Raja M. Irshad, Deputy Attorney General and Ahhlaq Ahmed Siddiqui, Advocate‑on‑Record for Appellants (in Civil Appeal No. 1804 of 1997).
Mirza Muhammad Siddiqui, Advocate Supreme Court and M.S. Khattak, Advocate‑on‑Record for Respondent No.1 (in Civil Appeal No 1804 of 1997).
Muhammad Bilal, Senior Advocate Supreme Court and Akhlaq Ahmed Siddiqui, Advocate‑on‑Record for Petitioner (in Civil Petition No. 163‑K of 1997).
Nemo‑for Respondents.
Date of hearing: 1st April, 2004.
JUDGMENT
JAVED IQBAL, J.‑‑‑This appeal with leave of the Court alongwith civil petition for leave to appeal arising out of the same judgment have been preferred against the judgment, dated 8‑5‑1997 whereby the Constitutional petition preferred on behalf of respondents has been accepted and the letter/notice, dated 1‑9‑1996 issued by the Assistant Collector, Customs House Gadani was declared as illegal, which are being disposed of by this common judgment.
2. Leave to appeal has been granted by this Court vide order, dated 3‑11‑1997 which is reproduced hereinbelow to appreciate the legal and factual aspects of the controversy:‑‑
"Having heard the learned counsel for the parties, we find it a case of first impression and leave is granted to consider the questions:
(i)Whether central excise duty in case of ship‑breaking is to be recovered as customs duty under section 30 of the Customs A Act, 1969 with reference to the date on which the bill of entry was filed and whether benefit of S.R.O. No. 457(1)/96, dated 13‑6‑1996 can be availed by the respondents.
(ii)Whether the value is to be determined in the instant case with reference to section 3(c) of the Excises Act, 1944 and as such, rule 96 ZZ of the Central Excise Rules does not apply.
2.The respondent is directed to furnish security of immovable property to the tune of a sum of rupees one crore twenty five lac to secure the amount claimed by the Customs Authorities within one month to the satisfaction of Assistant Collector Customs, Gadani. The amount already deposited by the respondent shall be adjusted against the dues already determined. Learned counsel for the Customs Department has no objection to such adjustment."
3. Raja Muhammad Irshad, learned Deputy Attorney General, entered appearance on behalf of the appellants and contended that central excise duty was to be recovered from respondent No.1 as customs duty pursuant to the provisions as contemplated in section 30 of the Customs Act, 1969 which aspect of the matter has been ignored by the learned High Court resulting in serious miscarriage of justice. It is urged strenuously that the duty was leviable on the date on which the bill of entry was filed and accordingly; the benefit of S.R.O. No. 457(1)/96, dated 13‑6‑1996 (hereinafter referred to as the S.R.O. in‑question) could not have been extended in favour of the respondents. It is argued that the learned High Court has misinterpreted and misconstrued rule 96 ZZ(4) of the Central Excise Rules, 1944 causing serious prejudice against the appellants.
4. We have carefully examined the view‑point as canvassed by learned Deputy Attorney General in the light of relevant provisions of law and record of the case. It is an admitted fact that the S.R.O. in question was made applicable w.e.f. 1‑7‑1996 and undisputedly bill of entry was filed on 9‑6‑1996 prior to the issuance of the S.R.O. in question. The learned Deputy Attorney General when pointedly asked that on which particular date the S.R.O. in question was withdrawn, he replied in an unequivocal manner that it was never withdrawn. In view of such a categoric statement, the date of bill of entry would be immaterial. Had the S.R.O. in question been withdrawn, the date of bill of entry would have been material. The exemption granted by virtue of S.R.O. in question was intact at the time of arrival of vessel namely VLCO COYSSEA which was permitted to be dismantled on 31‑10‑1996 which would be crucial date for the purpose of levying tax/duty, if any, pursuant to section 3(c) of the Central Excises Act, 1944. If any authority is needed reference can be made to case titled Federation of Pakistan, through Ministry of Finance and others v. Noorie Trading Corporation (Pvt.) Limited and others 1992 SCMR 710. The dictum as laid down in case titled Federation of Pakistan and others v. Amjad Hussain Dilwari and 2 others 1992 SCMR 1270, relied upon heavily by the learned Deputy Attorney General is not applicable in this case because exemption granted was withdrawn on a specific date in the above mentioned case whereas the S.R.O. in question remained intact and exemption was not withdrawn in this case which depicts a significant difference between the law laid down in the above mentioned case and the present appeal. The exemption being granted by means. of S.R.O. in question being intact could have been availed by the respondents. The other duties/taxes which are not included in S.R.O. in question regarding which no exemption was granted can be recovered from respondent No.1 subject to all legal exceptions and in accordance with law. The judgment being well‑based does not warrant interference.
5. We have heard Mr. M. Bilal, learned Senior Advocate Supreme Court on behalf of petitioner in Civil Petition bearing No. 163‑K of 1997 who mainly contended that adverse remarks passed against the Assistant Collector, Customs House Gadani are uncalled for having no nexus whatsoever with the record of the case and based on conjectural presumptions and baseless assumptions. It is argued that no notice whatsoever was served upon the Assistant Collector, Customs House Gadani and therefore, adverse remarks could not have been passed against him without affording proper opportunity of hearing. It is urged firmly that the Assistant Collector, Customs House Gadani was competent to assess and deposit the duty recoverable under the relevant law and thus no illegality whatsoever has been committed but on the contrary by depositing the recoverable duty benefit was given to the Government exchequer and the question of any personal advantage of the petitioner does not arise. Prior to adverting to the above mentioned contentions it may be appropriate to reproduce hereinbelow the adverse remarks given by the learned High Court for ready reference:‑‑‑
"What had happened that the Assistant Collector had encashed the above Pay Order and out of it deposited Rs.11,627,698.00 on 30th September, 1996 under his own signatures as it is indicative from the challan copy whereof has been annexed with the petition by the Department itself. Column No.1 of the Challan is meant for particulars of the person who has tendered the amount. In this column designation of the Assistant Collector Gadani with his seal and signature has been affixed. We failed to understand that what was object to commit such forgery by the concerned Officer because apparently petitioner had not done so as it is indicative from the facts particularly when no such instructions were ever given to the Assistant Collector. Even otherwise if the importer had agreed to pay the excise duty then what was the occasion for instituting instant Constitutional petition before this Court on 17th September, 1996 and also of obtaining interim stay order on 18th September, 1996.
It is quite surprising to note that the Assistant Collector Gadani despite of service had not appeared nor he has filed a counter affidavit to explain his position. We are anxious to know, whether he 'was competent to encash the Pay Order and thereafter withdraw some amount from it for the purpose of depositing in the different Head. However, in absence of any explanation either by him or the Deputy Attorney General we are inclined to hold that this exercise has been done by the Assistant Collector Gaddani with mala fide intentions, therefore, we direct that copy of the judgment be sent to Central Board of Revenue for the purpose of taking action against him as far as possible within the period of six weeks after receipt of the order and if on the expiry of stipulated period compliance report is not submitted. Registrar shall put up the file in Chambers for further orders."
6. A bare perusal of the above reproduced observations would indicate that petitioner had acted whimsically, arbitrarily and misused his authority by deducting duties/taxes in a fraudulent manner which is apparent on record and has rightly been taken care of in the judgment impugned. No illegality or irregularity whatsoever has been committed by passing the said remarks which are in consonance with record. The Central Board of Revenue shall take action pursuant to the observations as made by the learned High Court after affording proper opportunity of hearing to the petitioner. It may be a question of personal grievance but no question of law of public importance is involved in the matter persuading us to grant leave to appeal. The petition being merit less is dismissed and leave refused.
M.H./C‑92/SPetition dismissed.