MUHAMMAD RIAZ VS SECRETARY, REVENUE DIVISION, ISLAMABAD, 2009 PTD-FEDERAL-TAX-OMBUDSMAN-PAKISTAN 2042 (2009)

Customs Act (IV of 1969)---

----S. 168---Establishment of Office of Federal Tax Ombudsman Ordinance (XXXV of 2000), Ss.9, 10 & 11---Confiscation of vehicle---Complaint against---Vehicle in question was seized by Customs Authorities on suspicion of being smuggled one and vide ex parte order it was confiscated---Appeal filed by the complainant/owner of vehicle having been dismissed by Collector of Customs (Appeals), complainant filed appeal before the Customs Appellate Tribunal which was decided in favour of the complainant---When vehicle in question was stolen F.I.R. was lodged and Police arrested the thief and recovered the vehicle from him---Additional Sessions Judge ordered the vehicle to be returned on superdari to the complainant after verifying his credentials---Computer printout from Custom House also proved that the vehicle in question had been lawfully imported by the complainant---Customs Authorities, however, did not return the vehicle to the complainant, even after the decision of the Tribunal in favour of the complainant---Evidence produced by the complainant on record had, fully proved that the complainant had lawfully imported vehicle in question, but despite that the complainant was made to suffer twice; once by the car lifters who stole his vehicle and changed its chassis number; and secondly by the Customs Authorities whose investigation miserably failed to reach the right conclusion---Recommendations were- made to the effect that Federal Board of Revenue to hold a formal inquiry as to why Customs Officers had failed to do justice in the case; that Federal Board of Revenue also look into the propriety of fixing the dates of hearing in a hurry and deciding the matter ex parte; propriety and legality of selling the vehicle on nominal price of Rs.25,000 only also needed to be thoroughly inquired into; that as the address of the complainant/owner of the vehicle mentioned in the order-in-original was incomplete, same be ascertained whether show-cause notice and hearing notices were duly and actually delivered to him; that inefficiency and arbitrariness involved in the case be adequately investigated and those found responsible dealt with under the Removal from Service (Special Powers) Ordinance, 2000; and that compliance be reported within specified period.

Shamim Ahmad, Advisor (Dealing Officer).

Muhammad Riaz for the Complainant.

Ms. Zahra Haider, D.C. (Customs) for Departmental Representative.

FINDINGS/RECOMMENDATIONS

DR. MUHAMMAD SHOAIB SUDDLE, (FEDERAL TAX OMBUDSMAN).---Brief facts of the complaint are that the Customs authorities, Islamabad intercepted a Mitsubishi Intercooler motor vehicle, Model 1992 with Registration No. SGG-57 and asked its owner, Mr. Muhammad Riaz to produce documents to prove that it was .imported legally. As a measure of further scrutiny, the vehicle was subjected to examination of the chassis and engine numbers through necessary chemical process which revealed that the original chassis number had been rubbed off and new digits had been added. Therefore, the vehicle was seized by Islamabad Customs on 16-11-2007 on suspicion of being smuggled.

2. The Customs authorities issued a show-cause notice (SCN) to the Complainant and hearings were fixed for 29-11-2007 and 4-12-2007. The Complainant did not attend these hearings. It is doubtful whether the show-cause notice and hearing notices were duly delivered to the Complainant as his address on the Order-in-Original is also incomplete. Therefore, ex parte Order-in-Original No.92/2007 dated 31-12-2007 was passed confiscating the vehicle. The Complainant filed an appeal before the Collector of Customs (Appeals), Islamabad. He, too rejected the appeal vide his, Order-in-Appeal No. 152 of 2008 dated 5-3-2008. The Complainant filed an appeal before the Customs Appellate Tribunal, Islamabad (Bench-II), which was decided on 26-7-2008 in his favour.

3. The Tribunal in its decision discussed the circumstances surrounding the case at length and noted the, arguments of the Complainant that the vehicle was legally imported vide Index No.98 IGM No. 1376 dated 15-7-1992 under Import Permit No. IP 548012 and that it was duly registered with Motor Registration Authority under registration No. SGG 57. After the vehicle in question was stolen on 5-3-2006 (F.I.R. No. 138 dated 5-3-2006 lodged with Police Station, Civil Lines, Rawalpindi), the Peshawar Police arrested the thieves and recovered the vehicle from Mardan. The Additional Sessions Judge Mardan ordered the vehicle to be returned on superdari to the Complainant after verifying his credentials. A computer printout from Custom House, Karachi also proved that the vehicle had been lawfully imported under chassis number CONV 440NJO 1295.

4. The customs authorities, however, did not return the `vehicle to the complainant as per the decision of the Tribunal, hence he filed the Complaint under reference before the FTO.

5. The Revenue Division in their comments inter alia stated the following: ---

(i) That the vehicle was sold to SSP in Islamabad for Rs.25,000. This was done in the light of the instructions of F.B.R. issued vide their letter dated 18-10-2006 which laid down the rules for disposal of tampered confiscated vehicles. Para 1(ii) of the said rules inter alia states that such vehicle may be sold to the Government/semi-Government departments or organizations on the highest price offered by them.

(ii) The Complainant did approach the customs department a number of times. However, he is wrong in stating that no action was taken. A request was made to the SSP, Islamabad for returning the vehicle. An offer was made to replace the vehicle with another one. Even a letter was written to the I.-G. Police, Islamabad so that the decision of the Tribunal could be implemented. However, the SSP office did not return the vehicle.

6. In order to resolve the issue, hearings, were held in the FTO Secretariat, Islamabad on 14-1-2009 and 21-9-2009. Both the Complainant, Mr. Muhammad Riaz, and D.R. Ms. Zahra Haider, Deputy Collector Customs, Islamabad attended. The Complainant contended that there was no justification for retaining the vehicle after the Tribunal had decided the case in his favour. He further informed that the Honourable High Court, Islamabad, had also decided the case in his favour. Therefore, the vehicle must be returned at the earliest.

7. The Departmental Representative was accordingly asked to retrieve the vehicle from SSP Islamabad at the earliest. The FTO Secretariat also wrote to both the Deputy Collector Customs and SSP Islamabad Police to confirm return of the vehicle to the Complainant. The Deputy Collector Customs responded vide letter No. C-1919/2008 dated 7-8-2009 confirming return of the vehicle to the complainant.

8. It is observed from the facts stated above that owner of the vehicle, Mr. Muhammad Riaz, possessed evidence of lawful import of the vehicle in the form of the import documents and registration of the vehicle with the Motor Registration Authority. Print out of the vehicle could have also been obtained by the investigating staff from PRAL to E confirm its legal import as was later done by the Tribunal. Besides, the fact of theft was also well-known. In addition, there was evidence available that Additional Sessions Judge Mardan had ordered to hand over the vehicle on superdari to the owner (the Complainant in this case).

9. The disturbing question therefore, is why the available evidence, which effectively convinced the Additional Sessions Judge Mardan and alter the Customs Appellate Tribunal and the Honourable High Court, Islamabad, could not so convince the Customs authorities at the investigation stage that the vehicle was legally imported; that it lawfully belonged to the Complainant and that the owner had no role in tampering the chassis number. Were the Customs authorities not under obligation to conduct investigation fairly and competently to dispense justice to the owner? Indeed, the owner of the vehicle was made to suffer twice; once by the car lifters who stole his vehicle and changed its chassis number; and secondly, by the Customs Authorities whose investigation miserably failed to reach the right conclusion.

10. In view of the above findings, the following recommendations are made:

(i) FBR to hold a formal inquiry why the Islamabad Customs officers failed to do justice in this case through their fact finding investigation at the initial stage which were later reached by the Customs Appellate Tribunal and the Honourable High Court Islamabad;

(ii) FBR to also look into the propriety of fixing the dates of hearing in a hurry; on 29-11-2007 and 4-12-2007, and deciding the matter ex parte on 11-12-2007. The propriety and legality of selling the vehicle for Rs.25,000 only also needs to be thoroughly inquired into;

(iii) As the address of Mr. Muhammad Riaz, owner of the vehicle, mentioned in the Order-in-Original is incomplete, it be ascertained whether show-cause notice and hearing notices were duly and actually delivered to him.

(iv) The inefficiency and arbitrariness involved in this case be adequately investigated and those found responsible dealt with under the Removal from Service (Special Powers) Ordinance, 2000.

(v) Compliance be reported within 30 days.

H.B.T./134/FTOOrder accordingly.