ABDUL GHAFOOR through Muhammad Aleem Khan VS SECRETARY, REVENUE DIVISION, ISLAMABAD, 2008 PTD-FEDERAL-TAX-OMBUDSMAN-PAKISTAN 626 (2004)

Customs Act (IV of 1969)---

----S.18---Imports and Exports Control Act, (XXXIX of 1950)---Establishment of Office of Federal Tax Ombudsman Ordinance (XXXV of 2000), S.2(3)---Goods dutiable---Non-issuance of 'no objection certificate' (NOC) by the customs authorities to Excise and Taxation Department for the purpose of transfer of vehicle in the name of purchaser/complainant in spite of payment of duties by the seller on the ground that vehicles were imported under the scheme of temporary importation even after lapse of seven years---Department contended that importer approached the Central Board of Revenue for permission to retain goods, Central Board of Revenue allowed retention of vehicles on payment of duty and taxes---Permission was granted without prejudice to any action under Import and Export Control Act, 1950---Central Board of Revenue had not allowed subsequent sale of goods in the market---Otherwise, instead of approaching the customs authorities, the complainant should have asked the seller to obtain No Objection Certificate under Import and Export Control Act, 1950---Even after payment of duty and takes the permission of Ministry of Commerce was necessary for transfer of vehicles in the name of importers and the importer or the complainant should have approached the Ministry of Commerce---Validity---If it was necessary to obtain No Objection Certificate from the Ministry of Commerce, the complainant should have been advised of this requirement in 1997 when he first applied to the Collector---Matter was a simple one but due to neglect, inattention, inordinate delay due to incompetence and inefficiency, no decision had been taken for more than seven years which constitute mal administration---Duty and taxes were paid with the approval of Central Board of Revenue on temporarily imported trucks on 25-5-1996 but the transfer of vehicles in the name of the complainant/assessee applied in 1997 had not been allowed by the Excise & Taxation Department for want of No Objection Certificate from the customs---Federal Tax Ombudsman recommended that Central Board of Revenue should direct the Collector of Customs to issue No Objection Certificate to the complainant within thirty days.

Muhammad Aleem Khan for the Complainant.

Abid Hakro, Assistant Collector and Saleem Akhtar, Examiner for Respondent.

FINDINGS/DECISION

JUSTICE (RETD.) SALEEM AKHTAR (FEDERAL TAX OMBUDSMAN).---The Complainant has stated in the complaint that on 30-6-1996 he purchased 6 trucks of 1985 model from a company, which issued a transfer letter to the Excise and Taxation Department for transfer of vehicles in his name. He approached the E&T Department who wanted no objection certificate (NOC) from the customs. He applied to the Customs Department for issue of NOC on 3-9-1997.

2. It was stated that the company had imported these trucks against bank guarantee and the guarantee was released when duty and taxes amounting to Rs.210,86,741 were paid on 25-5-1996. Inspite of the payment of duty etc. the customs authorities did not issue NOC and the matter has been kept pending for mala fide reasons. It was further stated that on 8-3-2004 another application was sent to the Collector but with no result. It was alleged that all officers were in favour of issuing NOC except one person who wanted the matter to be referred to the Ministry of Commerce. The complainant stated that he did not understand why, after more than seven years, the need of referring the matter to Ministry of Commerce has been felt except that it was intended to harass him. He requested that the customs authorities be directed to issue NOC so that the vehicles could be transferred in his name.

3. The Deputy Collector of Customs, in his reply to the complaint, stated that complaint was not maintainable for the reasons that (1) since the matter related to 1997, it was barred by time under section 10(3) of the FTO Ordinance and (2) the vehicles were purchased by the Complainant without obtaining NOC from the respondent. He requested that since the purchaser was not relevant in this case, the complaint be dismissed.

4. It was stated that the vehicles were imported along with construction machinery and equipment under the scheme of temporary importation against bank guarantee and such goods were not transferable. When the importer approached the C.B.R. for permission to retain goods, C.B.R. allowed retention of vehicles etc. vide letter dated 20-3-1995 on payment of duty and taxes. The permission was granted without prejudice to any action under Import and Export Control Act. C.B.R. had not allowed subsequent sale of goods in the market. It was stated that instead of approaching the customs, the complainant should have asked the seller to obtain NOC under Imports and Exports Control Act. The Deputy Collector stated that the complaint be dismissed with the direction to the complainant to approach Ministry of Commerce to issue NOC.

5. During the hearing of the complaint, Mr. Muhammad Aleem Khan, Advocate, stated that after applying to the customs on 3-9-1997, he remained constantly in touch with the customs authorities at personal level but did not receive any reply. The Customs Examiner replied that even after the payment of duty and taxes the permission of the Ministry of Commerce was necessary for transfer of vehicles in the name of the importers and, therefore, the importer or the Complainant should have approached the Ministry. This information was verbally conveyed to the representative of the Complainant but not in writing.

6. He stated that the Advocate representing the Complainant has now approached the Collector vide letter dated 8-3-2004 to issue NOC for the vehicles. The Collector has referred the matter to the C.B.R. vide letter No.SI/Misc/229/90-VI (BG Cell) dated 13-4-2004 conveying the view that for issue of NOC the Ministry of Commerce was the competent authority but the importers were of the view that after C.B.R. permission for retention of vehicles on payment of duty and taxes the sale of the goods to a buyer should be allowed and requested the C.B.R. for advice in the matter. Custom House would take a decision as soon as the order or advice was received from the C.B.R.

7. The application of the Complainant has been pending decision for the last more than seven years and the special circumstances surrounding the complaint warrant investigation and appropriate action to redress this long outstanding grievance. This office has taken cognizance of the complaint in view of the special circumstances referred to in the foregoing paragraphs. The argument that the jurisdiction of this office was barred by time under section 10(3) of the Ordinance No.XXXV of 2000 is not maintainable.

8. If it was necessary to obtain NOC from the Ministry of Commerce, the Complainant should have been advised of this requirement in 1997 when he first applied to the Collector. It was a simple matter but due to neglect, inattention, inordinate delay due to incompetence and inefficiency, no decision has been taken for more than v seven years which constitute maladministration as defined under sub-section (3) of section 2 of the Ordinance.

9. The duty and taxes were paid with the approval of the C.B.R. on temporarily imported trucks on 25-5-1996 but the transfer of vehicles in the name of the Complainant applied for in 1997 has not been allowed by the E&T Department for want of NOC from the Customs. It is recommended that C.B.R.---

(i) direct the Collector of Customs to issue NOC to the complainant within thirty days; and

(ii) compliance be reported to this office within forty-five days.

C.M.A./335/FTO(K)Order accordingly.