Haji MUHAMMAD IQBAL VS COLLECTOR OF CUSTOMS (APPRAISEMENT) DRY PORT MUGHALPURA, LAHORE
2005 P T D 1189
[Lahore High Court]
Before Nasim Sikandar and Muhammad Sair Ali, JJ
Haji MUHAMMAD IQBAL and 7 others
versus
COLLECTOR OF CUSTOMS (APPRAISEMENT) DRY PORT MUGHALPURA, LAHORE and another
Customs Appeal No.9 of 2000, heard on /01/.
19th October, 2004. Customs Act (IV of 1969)---
----Ss.194-B, 196 & 156---Appeal to High Court---Allegation of smuggling---Imposition of fine---Member of the Appellate Tribunal disposed of the appeal by using general, vague and uncertain observationswhichweredevoidofreasons---Operativepartoftheorder of the Tribunal was not an effective disposal of the appeal before judicial forum---Such kind of order could be suffixed to any factual background---Such order showed rather lack of proper application of mind---Not the conclusion but the reason was the hallmark of a judicial order---Contentions placed before the Collector were wrongly rejected which were not even considered and ruled upon by the Members of the Tribunal---High Court accepted the appeal and set aside both the orders of the forums below and fine imposed by the Collector on the appellants was ordered to be remitted altogether---Principles.
Mian Abdul Ghaffar for Appellants.
Muhammad Zafar Iqbal Choudhry for Respondents.
Date of hearing: 19th October, 2004.
JUDGMENT
NASIM SIKANDAR, J.---This appeal under section 196 of the Customs Act, 1969 assails an order of the Customs, Central Excise and Sales Tax Appellate Tribunal, Lahore Bench, Lahore, dated 18-11-1999. ThroughthatorderaDivisionBenchoftheTribunalrejectedtheappeal filed by the present appellants against the order-in-original, dated 25-10-1997 recorded by Collector Customs, Lahore.
2.The factual background giving rise to this appeal being that on an information the Anti-Smuggling Wing of the Customs Department, Lahore kept a surveillance over two trailers/trolleys which were reportedly parked near MughalpuraBridge, Railway Crossing Lahore. On 17-8-1982 when these trailers/trolleys were moving towards Dharampura were stopped and taken to Customs House, Lahore. On search these containers led to recovery of 76 maunds Charas concealed in gray water proof bags packed in 21 bales of canvas cloth covered by gunny bags along with 9180.50 meters gray cloth and 292 cartons containing 29200 apparels of canvas cloth (gray). A case F.I.R. No. 176 of 1982, dated 19-8-1982 was registered under sections 156(1)(8) and (89) and 157 of the Customs Act, 1969 read with section 3(3) of Imports and Exports Control Act, 1950 with Police Station Mustafa Abad, Lahore.
3.After seizure of Charas and other goods the matter was investigated by different Officers of the Department and on completion thereof a challan was submitted in the Court of Special Judge Customs Lahore. At the same time the seizure report was forwarded to respondent No.1, Collector Customs (Appraisement), Lahore for initiating adjudication proceedings. Learned Special Judge Customs on usual proceedings acquitted appellants Haji Muhammad Iqbal, Muhammad Zubair, Muhammad Tariq and Muhammad Zahid. Appellants Muhammad Khalid, Muhammad Qasim, Muhammad Asif and Muhammad Nadeem were found innocent during investigation and, therefore, were placed in Column No.2 of the challan. They were also exonerated by Special Judge Customs. The orders were recorded by him on 20-4-1987, 26-6-1987 and 28-6-1987.
4.On adjudication side the learned Collector Customs on conclusions of adjudication proceedings imposed a penalty of Rs.1 million on each of the appellants as well as other persons mentioned in the show-cause notice. The appeal filed by the appellants before respondent No.2, the learned Customs, Excise and Sales Tax Appellate Tribunal, as noted above, was rejected. The operative part of the order reads as under:--
We have examined the case record thoroughly, heard both sides in detail, addressed ourselves to the relevant provisions of law on the subject and find that there is hardly any justification for remission of fine or reduction thereof because the appellants had intentionally chosen to indulge in the act of smuggling of a heavy quantity of Charas. We fully endorse and confirm the findings of the learned Collector and hold that the orders appealed against are correct in law and on facts. The appeal stands dismissed.
5.Having heard the parties we will readily agree with the learned counsel for the appellants that the operative part of the order as reproduced above is not an effective disposal of the appeal before a judicial forum. After recounting the facts as given in the order in original learned members of the Tribunal disposed of the appeal byway of the operative part as reproduced above. That kind of order can be suffixed to any factual background. It rather shows lack of proper application of mind.
6.Learned counsel for the appellant is also correct in saying that despite having earlier reproduced their main contentions learned members failed to rule upon them. These contentions being that at best it was a case punishable under Articles 3 and 4 of the Prohibition (Enforcement of Hadd) Order, 1979 as no provisions of the Customs Act, 1969 were attracted because the Charas in question was seized outside the customs area and till then no document such as shipping bill had been presented before the Customs Authorities; at the most it could be taken as a case of preparation under the Customs Act, 1969 and not even as attempt to smuggle inasmuch as the goods seized were not of foreign origin; that proceedings under the provisions of sections 156(1), 8 and 89 of the Customs Act, 1969 were totally uncalled for; that the appellants having been acquitted in the criminal case by the Special Judge Customs Lahore the imposition of heavy penalties even thereafter by the Collector Customs were legally unsustainable and that neither any evidence was recorded by Collector Customs nor any documentary evidence was considered to bring home guilt to the appellants. 7.It is true that mere acquittal by the criminal Court did not bar any proceedings before the Collector Customs under the said provisions of the Customs Act. However, it is equally correct that the Collector while imposing fine failed to pinpoint the exact role played by the appellants who were Managing Director and Directors of two Limited Companies namely Messrs Hafeez Woollen Mills Limited, Kot Lakhpat, Lahore and Messrs Iqbal Woollen Mills Limited, Kot Lakhpat, Lahore. His observation that these two companies had financed the export and smuggling of seized goods was not based upon any material available on record.
8.We are also in agreement with the submissions made at the bar that the goods in question having not entered in the customs area and no customs document having ever been presented to the authorities for their intended export abroad it was only a case punishable under Articles 3 and 4 of the Prohibition (Enforcement of Hadd) Order 1979. Mere fact that the raiding party comprised of Customs Officials did not make it a case of smuggling or even attempt to smuggle. Apparently the anti-smuggling staff of the Customs Department became impatient and intercepted the trailers/trolleys before these entered the customs area. They ought to have waited the entry of the trailers in the customs area as also the presentation of export documents. In that manner only they could being the real culprits to picture. In the given situation it was only trailers/ trolleys drivers who were directly found connected with the commission of offence. Rest of the persons connected therewith including the appellants was mere an act of Police Karvai. We are also of the view that the learned Collector before imposition of fine ought to have gone through the judgment of the Special Judge Customs, Lahore while acquitting the appellants. It also appears strange that the learnedCollector proceeded to impose fine on appellants Muhammad Khalid, Muhammad Qasim, Muhammad Asif and Muhammad Nadeem who were earlier declared innocent by the Customs Authorities themselves.
9.Even on legal side the findings of the Collector that it was not an attempt and that it was an actual act of smuggling on the part of the appellants is neither supported by any material on record nor any of the provisions of law under which the appellants were charged.
10.As not earlier, learned members of the Tribunal disposed of the appeal by using general, vague and uncertain observations which were devoid of reasons. Needless to remark that it is not the conclusion but the reason which is hallmark of a judicial order. The aforesaid contentions placed before the Collector were wrongly rejected while these were not even considered and ruled upon by the learned members of the Tribunal.
11.Therefore, we will accept this appeal and set aside both the orders of the forums below. Resultantly the fine imposed by the Collector on the appellants shall be remitted altogether.
M.B.A./M-928/LAppeal accepted.