Messrs FLYING BOARD AND PAPER PRODUCTS (PVT.) LIMITED VS DEPUTY COLLECTOR OF CUSTOMS, DRY PORT, LAHORE, 2006 PTD-SUPREME-COURT 2354 (2006)

(On appeal from the judgment, dated 23-10-2002 of the Lahore High Court, Lahore, passed in Customs Appeals Nos. 430 to 450 of 2002).

(a) Customs Act (IV of 1969)---

----S. 81---Constitution of Pakistan (1973), Art.185(3)---Leave to appeal was granted by Supreme Court to consider that: whether the 8 Bills of Entry relied upon by the Tribunal as well as the High Court had been confused with the 14 Bills placed reliance upon by the petitioners; that whether the import was made by the petitioners through 14 Bills of Entry at the rate of U$$ 350/370 pursuant to the interim order, dated 25-11-1996 passed by Lahore High Court; that which of the Bills of Entry pertained exactly to the period of import and assessment; that what evidence was required to be brought on record on either side and what evidence had the importers practically brought on record to substantiate their claim of decline in prices and that what effect section 81 of the Customs Act, 1969, had on the prevailing assessment in question.

(b) Customs Act (IV of 1969)---

----Ss. 25 & 80---Imported goods---Transaction value, determination of---Importer's claim for assessment of goods at a price lower than declared price alleging fall in its prices in international market---Validity---Importer after importing goods at declared price could not claim its assessment at a price lower than declared price, even if he had succeeded to establish decline in price after purchase of goods--Principles.

Messrs Flying Board and Paper Products v. Deputy Collector, Customs 2004 PTD 2201 rel.

(c) Customs Act (IV of 1969)---

----S. 81---Provisions of S.81 of Customs Act, 1969 requiring finalization of assessment within 180 days---Not applicable to provisional assessment made in pursuance of an interim order passed by High Court in a pending case.

Abdul Hafeez Pirzada, Senior Advocate Supreme Court for Appellant.

A. Karim Malik, Senior Advocate Supreme Court, Raja Muhammad Irshad, D.A.-G. and Mumtaz Ahmad, Member (Legal) C.B.R. for Respondent.

Date of hearing: 25th May, 2006.

JUDGMENT

ABDUL HAMEED DOGAR, J.---By this single judgment, we intend to dispose of the above 21 appeals which are directed against a common judgment, dated 23-10-2002 passed by a learned Division Bench of the Lahore High Court, Lahore whereby Custom Appeals Nos.430 to 450 of 2002 filed by appellant in the above appeals were dismissed.

2. Briefly, stated the facts of the cases are that appellant imported 21 consignments of Bleached soft wood sulphate pulp against Bills of Entry through Messrs Zawah Apex Company Customs Clearing Agent, Lahore, against Clean Report of Finding (hereinafter referred to as "C.R.F.") under section 25 of the Customs Act, 1969 in which price of the goods was declared at US$ 500 per metric ton. However, Pre-shipment Inspection Company (hereinafter referred to as "PSI") determined the value at US$ 510.05 per metric ton. As the price of the goods had fallen due to downwards trend in the International Market, appellant claimed assessment of goods at the lower value and invoked constitutional jurisdiction of the Lahore High Court through Writ Petition No.21049 of 1996 wherein vide interim order, dated 25-17-1996 the goods were provisionally released at the rate of US$ 350 plus 10% of the declared market value subject to furnishing bonds qua differential amount. However, Deputy Collector Customs vide order, dated 22-2-2002 directed appellant to clear the consignment at the invoice value of the goods at US$ 510.05 per metric ton which order was assailed in appeal before the learned Customs, Excise and Sales Tax, Appellate Tribunal, Lahore, wherein appellant pleaded that since the price of the goods in the market had declined, therefore, the Custom Authorities should assess its value in terms of section 25 of the Customs Act. Appellant referred to 14 Bills of Entry wherein the indented goods were cleared by the Customs Authorities at the value of US$ 350 and 370 per metric ton in between the period from 18-9-1996 to 7-5-1997. The plea was repelled by the Tribunal vide order, dated 28-6-2002 on the ground that the evidence of lower value relied upon by the appellant in support of contentions pertained to their own 14 consignments six of which were assessed at lower value in pursuance of the interim order, dated 25-11-1996 passed by the learned Lahore High Court while the remaining eight consignments were cleared at the declared import prices, which were less than the declared import price in the 21 consignments in question. This order was assailed before learned High Court through Custom Appeals Nos.430 to 450 of 2002 which were dismissed vide impugned judgment.

3. On 30th July, 2003, this Court granted leave to appeal in these matters to consider the following points:

(a) Whether the 8 bills of entry relied upon by the Tribunal as well as the High Court have been confused with the 14 bills placed reliance upon by the petitioners;

(b) Whether the import was made by the petitioners through 14 Bills of Entry at the rate of US$ 350/370 pursuant to the interim order, dated 25-11-1996 passed by Lahore High Court;

(c) Which of the Bills of Entry pertained exactly to the period of import and assessment;

(d) What evidence was required to be brought on record on either side and what evidence have the importer practically brought on record to substantiate their claim of decline in prices;

(e) What effect section 81 of the Customs Act, 1969, has on the prevailing assessment in question?

4. We have heard Mr. Abdul Hafeez Pirzada, learned Senior Advocate Supreme Court for the appellant and Messrs A. Karim Malik, learned Senior Advocate Supreme Court and Raja Muhammad Irshad, learned Deputy Attorney-General for respondent and have gone through the record and the proceedings of the case in minute particulars.

5. Learned counsel for the appellant contended that the impugned judgment is based on a total non-reading/misreading of the record and such order cannot be sustained in law. He further contended that the goods imported by the appellant were released @ US$ 350 with an increase of 10% i.e. at US$ 385 per metric ton due to the decrease in the international market which factor was taken into consideration by the learned High Court while releasing the goods provisionally. According to him, in fact the goods were cleared and the duty was levied keeping in view the decline of the price of the goods in the International Market. He further contended that at least 8 out of 14 Bills of Entry pertained to dates before the interim order of the High Court which were never challenged by the Customs Authorities and attained finality upon the expiry of six months in view of section 81 of the Customs Act, 1969. Learned counsel mainly stressed that appellant had brought on record the copies of 14 Bills of Entry indicating the value of identical goods which were cleared by Customs Authorities at the value of US$ 350 and 370 per metric ton during the period from 18-9-1996 to 7-5-1997 and contended that the same value should be applied in the instant cases. According to him, though the import prices of the 21 consignments at the time of import was declared at US$ 500 MT by appellant but by the time he filed ex-bond Bill of Entry for clearance of goods, the value had declined due to downward trend in the international market. Accord ingly, it was necessary for the Customs Authorities under section 25 of the Customs Act, 1969 to determine the actual value of the goods for the purpose of levy of customs duty and other charges by holding an inquiry and determining the value of the goods and such finding was to be based on some evidence which in the instant cases was not collected by the Adjudicating Officer or any other customs authority.

6. On the other hand, learned counsel for the respondent vehemently controverted the above contentions and contended that the appeals in hand do not relate to the above mentioned 14 Bills of Entry but relate to 21 ex-bond Bills of Entry which have been called in question in these above civil appeals by the appellant and such statement disclosing its description is placed on record. According to him, appellant had himself declared the value of goods at US$ 500 per metric ton, therefore, cannot claim the benefit of determination of import price at a lower rate in pursuance of the assessment in the other 14 consignments. The appellant in the said statement though assessed the value for the clearance of the goods at US$ 350 per metric torn but did not produce any evidence to substantiate the same. The appellant cannot have the benefit of provisions of section 81 of the Customs Act, 1969 as assessment of six Bills of Entry referred to above was made provisionally on the interim order of the High Court and had nothing to do with the actual value declared by them in the Bills of Entry. This Court while dealing with the same aspect of the matter in between the same parties in the case titled Messrs Flying Board and Paper Products v. Deputy Collector, Customs 2004 PTD 2201, rejected the claim of the appellant.

7. We have also gone through the statement showing the particulars of 21 ex-bond Bills of Entry, the subject-matter of these appeals in which the appellant himself declared the value of goods at the rate of US$ 500 M.T. and as per C.R.F. issued by PSI, the value was determined at US$ 510.05 per metric ton. Out of total 21 Bills of Entry 11 ex-bond Bills of Entry were filed during the same period while the remaining 10 were filed shortly afterwards i.e. after a period of one to two months within the tolerance limit provided under CGO No.1/1981, dated 16-12-1981. We, therefore, do not see any merit in the appellant's contention that there was fall in the prices due to declining trend in the international market and the consignments sought to be cleared through the 21 Bills of Entry ought to have been assessed at the lower prices of US$. 350/370 per metric ton. The appellant having imported the 21 consignments at the declared price of US$ 500 per metric ton could not claim to be assessed at a price lower than the declared price even if it had succeeded to establish that the prices had gone down after the purchase of the above consignments which they failed to establish. Even otherwise the contention of assessment at a lower price would be without any substance in the wake of evidence of higher import prices declared by other importers which proved beyond doubt that during the relevant period import price of similar goods was much higher than the price of US$ 510.05 per metric ton assessed by the Adjudicating Officer which was determined keeping in view the price, quality and origin of goods. In the case of Flying Board and Paper Products referred (supra), this Court declined the relief claimed under the similar circumstances to the appellant and dismissed its petition and refused leave to appeal. It would be advantageous to refer para.6 of the judgment which reads as under:

"(6) Since the petitioner raised the plea that the value of the goods had gone down on account of fluctuation in the country from where the goods were imported, therefore, the onus was on the petitioner to prove by evidence as to what extent, the value of the goods had decreased. No evidence was produced by the petitioner. The Customs Authorities who were vested with the power to assess the actual value of the goods for the purpose of customs duty, therefore, in the absence of any such evidence were justified in law to accept the value as declared in the bill of entry as the value for the purpose of customs duty to which no exception can legally be taken by the petitioner."

8. Provision of section 81 of the Customs Act, 1969 requiring finalization of provisional assessment of the duty within six months was not attracted in these cases as the goods were released on the provisional assessment made in pursuance of an interim order passed by learned High Court pending decision.

9. Accordingly, finding no merit in the appeals the same are dismissed with no order as to costs.

S.A.K./F-15/SCAppeals dismissed.