NAZMAFK (PVT.) LTD. through Chief Executive VS FEDERATION OF PAKISTAN, through Secretary (Revenue Division/FBR), 2009 PTD-LAHORE-HIGH-COURT-LAHORE 1463 (2009)

Customs Act (IV of 1969)---

---Ss. 32 & 195---Provisions of Ss.32 & 195 of Customs Act, 1969---Applicability---Where information from other sources and outside record of proceedings highlighted incorrect disclosure of value of goods, then provision of S.32 of Customs Act, 1969 would apply--Proceedings under S.195 of Customs Act, 1969 could be initiated on basis of inspection of record itself and not for reason of information collected from outside---Value of goods determined earlier on basis of documents submitted by assessee, if found to be low subsequently, then provision of S.32 of Customs Act, 1969 would apply with full force---Section 32 of the Act wide enough to cover under-statement or submission of wrong documents by assessee regarding value of goods---Departmental hierarchy was competent' to consider whether information with department was good enough for reappraisal of value or not---Assessee in such case would have chance to avail alternate remedy of regular appellate jurisdiction---Principles.

Messrs S.T Enterprises through Proprietor v. Federation of Pakistan through Secretary (Revenue Division F.B.R.). Islamabad and 4 others 2009 PTD 467; Messrs Zibtec (Pvt.) Ltd. through Director and another v. Collector of Customs, Model Customs Collector and 3 others 2009 PTD 246; Messrs Julian Hoshang Dinshaw Trust and others v. Income Tax Officer, Circle XVIII South Zone, Karachi and others 1992 SCMR 250; Gatron (Industries) Limited v. Government of Pakistan and others 1999 SCMR 1072; Maple Leaf Cement Factory Limited v. Collector, of Customs House, Faisalabad 2000 YLR 1989 and Messrs Toyo International Motorcycle through Proprietor v. Federation of Pakistan through Secretary (Revenue Division) Central Board of Revenue, Islamabad and 3 others 2008 PTD 1494 ref.

Mian Abdul Ghaffar and Malik M. Arshad for Petitioners.

Sh. Izharul Haq for Respondents.

Date of hearing: 6th May, 2009.

JUDGMENT

KHAWAJA FAROOQ SAEED, J.---This writ petition will dispose of Writ Petition No.18776, Writ Petition No.18777 and Writ Petition No.18778 of 2008, as the common questions of law are involved in both these writ petitions.

2. Brief facts leading to this writ petition are that the petitioner is a limited company incorporated under Companies Ordinance, 1984. The company exported consignment of Stainless Steel Scrap at unit value of US$ 400.00 to 500.00 per Metric Ton, vide bill of export outside Pakistan. All the consignments were 100% examined and assessed and thereafter allowed to be exported. The export of the aforesaid goods attracted regulatory duty @ 25% in terms of S.R.O. 482(I)/2007 dated 9-6-2007 on the assessed value and accordingly the same was sent abroad.

3. Now the petitioners were served with show-cause notices alleging therein that the respondent has received an information that the value of the aforesaid goods for export purposes and charging regulatory duty is at the lower side. Further, according to KCH data the value should have been assessed @ US$ 1450.00 per Metric Ton. The said show-cause notice has been issued under section 32(1) read with sections 178 and 179 punishable under clause (14) of section 156(1) of the Customs Act, 1969.

4. All these notices have now been challenged inter alia on the basis of following grounds:--

(a) That the initiation of the proceedings against the petitioners on the basis of the information is not justified further.

(b) That section 32 in the situation does not come into picture.

(c) That it is a case where the import is already out of charge and the goods after receipt have been further alienated to the other parties. This case has attained finality and in such situation the provision of section 32 does not apply.

5. This in his opinion is covered under section 195 and in this regard he has relied upon (2009 PTD 467) re: "Messrs S.T. Enterprises through Proprietor v. Federation of Pakistan through Secretary (Revenue Division F.B.R.). Islamabad and 4 others". Incidentally the said judgment has been decided by this court. The judgment in fact is distinguishable in the manner that it has explained the circumstances in which the section 32 can be invoked. However, it has not distinguished between the areas on which section 32 or 195 can respectively be applied. The circumstances mentioned therein are in respect of the language provided of the said section.

6. Further reliance has been placed on (2009 PTD 246) re: "Messrs Zibtec (Pvt.) Ltd. through Director and another v. Collector of Customs, Model Customs Collector and 3 others". In the judgment now referred this court has explained the jurisdiction of the Collector of Customs. It has been said that the order passed by Principal Appraiser Customs can only be re-opened by Collector of Customs while exercising jurisdiction under section 195. Further that Collector of Customs can only revise the order if any illegality or irregularity is committed by the Principal Appraiser or its subordinate. Any such order by Deputy Collector of Customs against the order of Principal Appraiser was without jurisdiction and lawful authority qua the right of the importer.

7. On an objection from the respondents side that the petitioners have alternate remedies, learned counsel claims that the writ petition in fiscal matter has been allowed to be entertained where the matter relates to the jurisdiction. Since in the present case issuance of a notice under section 32 is without jurisdiction and the case could only be reassessed under section 195, jurisdiction has not properly been exercised. Reliance is on (1992 SCMR 250) re: "Messrs Julian Hoshang Dinshaw Trust and others v. Income Tax Officer, Circle XVIII South Zone, Karachi and others", (1999 SCMR 1072) re: "Gatron (Industries) Limited v. Government of Pakistan and others" (2000 YLR 1989) re: "Maple Leaf Cement Factory Limited v. Collector, of Customs, Customs House, Faisalabad" and (2008 PTD 1494) re: "Messrs Toyo International Motorcycle through Proprietor v. Federation of Pakistan through Secretary (Revenue Division) Central Board of Revenue, Islamabad and 3 others".

8. The goods exported having properly been appraised under provision of section 25(15), therefore, had attained finality, hence the invocation of provision of section 32 is not lawful, the learned counsel finally concluded.

9. The respondents' case on the other hand is that in any case alternate remedies are available, hence, approaching this court directly is unnecessary. Further the petitioners' value being ridiculously low in comparison to the similar items exported by the other traders, the department had full right to review and re-check and consequently re-appraise the consignments exported. He again objected to the maintainability of a writ petition and referred (1999 SCMR 1881) re: "Khalid Mehmood v. Collector of Customs, Customs House; Lahore".

10. So far as the issue of maintainability of the writ jurisdiction is concerned, one would not refrain to entertain if the petitioner succeeds in persuading that the invocation of jurisdiction under the provision of section 32 is not lawful: In fact this court is not convinced with the arguments that the provision of section 32 are not invokeable in this case.

11. The petitioners made a statement before the authorities with regard to the value of their imported goods knowingly that the same was not the correct value and have also submitted documents with regard thereto on the basis of which the same was determined and made out of charge. Subsequently on the basis of parallel cases, the petitioners if have got a reason to believe that the value earlier appraised is low, section 32 would apply with full force.

12. Knowledge of a document or import value at the time of filing G.D if not disclosed truly makes the person guilty. The language is very clear and leaves no doubt with regard thereto. Hence, if information outside the record of the proceedings highlights such incorrect disclosure section 32 applies.

13. Section 195 deals with a different situation. It starts from the language that the Customs Collector or Federal Board of Revenue after calling for the record and inspection of the .proceedings can further C proceed in the matter. It does not apply where the information comes to the knowledge from the other sources.

14. It is true that it can be applied where the legality or proprietary of any decision of the subordinate is challengeable, but, however, the proceedings therein can only be initiated on the basis of the inspection of record itself and not for the reason of the information collected from out-side. Apparently, this is the basic difference; but, however, this court leaves it for some other case for detailed discussion.

15. In the present case, there are all the reasons to believe that section 32(1), is wide enough to cover the under-statement or submission of wrong documents.

16. Regarding whether the information with the department is strong enough to reappraise the value is concerned, the same is left for the consideration of the departmental hierarchy, where the petitioners shall obviously have the chance to avail of regular appellate jurisdiction.

17. The writ petition, therefore, is decided against the petitioners by holding that section 32 is applicable in principle. However, whether the facts of the case in terms of evidence with the department is good enough for reappraisal or not is left for the consideration of the respondents where the alternate remedy is available and can be invoked if so advised.

18. Disposed of.

S.A.K./N-45/L??????????????????????????????????????????????????????????????????????????????????????????????? Petition dismissed.