REAL TRADING CO. through Wali Muhammad, Karachi VS COLLECTOR OF CUSTOMS, MODEL CUSTOMS COLLECTORATE OF PaCCS, KARACHI, 2010 PTD-KARACHI-HIGH-COURT-SINDH 826 (2010)

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

----S.27-A---Importer seeking benefit of S.27-A of Customs Act, 1969 after filing declaration of goods---Validity---Such benefit could be extended to importer, if same was claimed by him prior to filing of said declaration, but not thereafter in any case---No provision would be read in a manner to render same as redundant or superfluous---Granting of such benefit to importer as claimed by him would render provision of S. 27-A of Customs Act, 1969 as redundant---Such benefit was not available to importer in circumstances---Principles.

Collector of Customs v. Muzammil Ahmed 2009 PTD 266; Sunny Traders v. Federation of Pakistan 2009 PTD 281 and Messrs K&N's Poultry Farms (Pvt.) Ltd., Karachi v. Additional Collector of Customs, Karachi and others 2006 PTD 2780 ref.

Tanveer Hussain v. Ravi Ryan Ltd. 2007 SCMR 737; Master Molty Foam v. Government of Pakistan PLD 2005 SC 373; Afteb Shaban Mirani v. Muhammad Ibrahim PLD 2008 SC 779 and Accountant General Sindh v. Ahmed Ali U. Shaikh PLD 2008 SC 522 rel.

(b) Interpretation of statutes---

----No provision would be read in a manner to render same as redundant or superfluous.

Tanveer Hussain v. Ravi Ryan Ltd. 2007 SCMR 737; Master Molty Foam v. Government of Pakistan PLD 2005 SC 373; Afteb Shaban Mirani v. Muhammad Ibrahim PLD 2008 SC 779 and Accountant General Sindh v. Ahmed Ali U. Shaikh PLD 2008 SC 522 rel.

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

----S.196---Reference to High Court involving question of fact or law not arising from impugned order for the Tribunal-Validity-High Court had no jurisdiction to decide such question.

Ammar Yaseer for Applicant.

Sibtain Mahmood for Respondent.

Ashiq Raza, Dy. A.-G. on court notice.

ORDER

IRFAN SAADAT KHAN, J.---By this Special Customs Reference Application, order dated 7-10-2008 of the Customs, Excise and Sales Tax Appellate Tribunal, Bench-II, Karachi (CESTAT) is assailed in which following questions of law have been raised:

(1) Whether on the facts and circumstances of the case the term "...before the filing of the goods declaration" as mentioned in section 27A of the Customs Act, 1969 means that importer is aware of the exact sizes of the imported goods?

(2) Whether on the facts and circumstances of the case if importer is not well aware of `exact/sharp sizes' of the imported goods, does it mean that the amnesty granted by legislature by the provisions of section 27A would declare that importer got deprived of that amnesty, as he could not file the request?

(3) Whether on the facts and circumstances of the case if importer has not made request "...before the filing of the goods declaration" (in case of his being unaware) for denaturing or mutilation or scrapping of the imported goods which are ordinarily used for more than one purpose, then does Custom Department is at right side to hold that importer has not filed request for same purpose with mala fide intentions and he was aware of sharp sizes of the imported goods?

(4) Whether on the facts and circumstances of the case goods were not liable to "duty at such rate as may be applicable if the goods had been imported in denatured or mutilated form or scrap" instead of 50% of the ascertained value of goods?

2. Mr. Ammar Yasser Advocate appeared on behalf of the applicant and submitted that the department Was not justified in not granting the benefit as available and provided under the provisions of section 27A of the Customs Act, 1969 ('The Act'). According to the learned counsel he was not aware of the actual shape and sizes of the goods imported by him and only came to know about the size and shape of the goods after receipt of the said consignment. According to the learned counsel, the department was not justified in not granting him the said concession, as there is no deliberate concealment of this fact on his part. He submitted that the concession provided in S.R.O. 462(I)/2007 is available to him and was incorrectly denied by the Custom Authorities. As per the learned counsel his goods are classifiable under PCT heading 7204.4910 whereas the department has incorrectly applied the PCT Heading 7303.0000. He further pointed out that the order passed by the CESTAT suffers with a legal defect that the same has been passed by a Member (Technical) sitting singly and in support thereof has relied upon the decision given in the case of Collector of Customs v. Muzammil Ahmed (2009 PTD 266). In the end the learned counsel has submitted that the procedure of valuation adopted by the Custom Authorities was not in accordance with the law and in this regard has relied upon the decision given by the Lahore High Court in the case of Sunny Traders v. Federation of Pakistan (2009 PTD 281).

3. Mr. Sibtain Mahmood Advocate appeared on behalf of the department and submitted that firstly no question of law is arising out of the order passed by the CESTAT and all the questions raised are questions of fact and hence are not liable to be answered by this Court under the provisions of section 196 of the Act. He thereafter, submitted that the applicant deliberately declared incorrect PCT Heading to take advantage of the said S.R.O. 462. He further submitted that he request under section 27A was only made by the applicant after detection by the Custom Authorities that they had misdeclared their goods. According to the learned counsel, the applicant were in full knowledge of their imported goods and intentionally tried to deceit the Government functionaries to get their goods cleared without payment of the due duty/taxes. He further submitted that as no plea regarding hearing of the appeal by a Member (Technical) sitting singlly in respect of a question of law has been raised in the reference application, hence the same could not be agitated before this Court at this stage. Finally the learned counsel argued that this reference application is misconceived and is liable to be dismissed in limine.

4. Mr. Ashiq Raza D.A.-G. appeared on Court notice and adopted the arguments of Mr. Sibtain.

5. We have heard both the learned counsel at length and have also gone through the record of the case.

6. Briefly stated the company electronically filed its Goods Declaration (GD) bearing CRN-383819 dated 7-9-2007 declaring that they have imported "Remeltable Rerollable Iron and Steel Scrap" under the PCT Heading 7204.4910 and claimed the benefit of S.R.O. 462(I)/ 2007 that no sales tax is payable on the above imported goods. The applicant thereafter determined its tax liability and sought the clearance under the provisions of section 79(1) of the Act. The GD of the applicant was selected for detailed scrutiny under the provisions of section 80 of the Act and on examination of the said goods, it was found that the same do not fall under the heading 7204.4910 as declared by the applicant rather as per the respondent these goods fall under the PCT Heading 7303.0000. The respondent thereafter, found the applicant to be guilty of not only misdeclaring the goods but also incorrectly and illegally claiming the benefit of the above referred S.R.O. The respondent thereafter on the basis of the data available in respect of similar goods determined the value of the goods under question. A show-cause notice dated 27-9-2007 was thereafter issued by the respondent through which it was confronted to the applicant that they have not declared their goods in the correct PCT Heading and they have deliberately misdeclared their goods. Therefore, the Deputy Collector vide his Order in Original No.2002 of 2007 dated 27-10-2007 found the applicant to be guilty of firstly getting the goods cleared which otherwise were not importable and secondly claiming the benefit of the S.R.O., which also was not available to them. Being aggrieved with the Order in Original the applicant thereafter filed an appeal before the Collector who vide his order dated 15-12-2007 allowed the appeal by observing that in the case of companies importing identical goods the department has been allowing the release of the said goods hence same treatment should be given to the applicant also. Therefore, the department preferred an appeal before the CESTAT which vide its order dated 7-10-2008 allowed the appeal of the department by observing that the benefit of section 27A of the Act is not available to the applicant as they had admittedly not made any request for denaturing or mutilation or scraping of their goods prior to the filing of GD, as specifically provided under the above referred section.

7. Before advancing further in the present reference application it would be advantageous if the relevant provision of the Act is first dealt with which is hereby reproduced as under:---

"[27A. Allowing denaturing or mutilation of goods.---At the request of the owner, [to be made before the filing of goods declaration,] the denaturing or mutilation or scrapping of imported goods, which are ordinarily used for more than one purpose, may be allowed, as prescribed by rules so as to render them unfit for one or more such purposes and where any goods are so denatured or mutilated or scrapped they shall be chargeable to duty at such rate as may be applicable if the goods had been imported in the denatured or mutilated form or as scrap.]" (underline ours)

8. A perusal of the above referred section would reveal that a benefit has been provided by the law to the owner of the goods to make a request for denaturing and mutilation or scrapping of imported goods, which request has to be made before the filing of the GD by the said importer. No benefit under the above section could be provided to any person who fails to make the said request before the said declaration. In the instant case admittedly the present applicant made the said request after the filing of the said GD, hence the benefit of section 27A of the Act, which clearly lays down "before the filing of goods declaration", could not be extended to them as the applicant has failed to take the prescribed steps at the appropriate time as provided in the above referred section. Reference in this regard may be made to the decision given by this Court in the case of Messrs K&N's Poultry Farms (Pvt.) Ltd., Karachi v. Additional Collector of Customs, Karachi and others 2006 PTD 2780) wherein under somewhat similar situation this Court observed as under:--

S.27---Damaged or deteriorated goods---Abatement of duties---Claim---Importer sought abatement against import of chicks made in August, 1998, for loss sustained to previous consignment of chicks imported in July, 1998---When earlier imports were made, the consignment was got released upon payment of customs duties and charges without lodging any complaint in writing with regard to dead chicks---Complaint was lodged for the first time after more than one month of earlier import---Abatement of duty was declined by Customs Appellate Tribunal---Validity---Importer failed to take prescribed steps at the appropriate time provided under section 27 of Customs Act, 1969---Customs Appellate Tribunal rightly found that provisions of section 27 of Customs Act, 1969, were not followed and therefore, claim of importer was not legally maintainable---High Court declined to interfere in the order passed by Tribunal---Appeal was dismissed accordingly.

9. Moreover, if the benefit of section 27A of the Act as claimed by the applicant is granted to them, it would defeat the very purpose, of this section as it has clearly been mentioned in the said section that the request from the owner has to come prior to the filing of GD and thus in our view the said benefit is not available to the present applicant. We are also of the view that if the said benefit is granted to them', the provisions of section 27A would become redundant. It is a trite proposition of law that no provision is to be read in a manner to render the same as redundant or superfluous. Reference in this regard may be made to the following decisions:

(i) Tanveer Hussain v. Ravi Ryan Ltd. (2007 SCMR 737)

(ii) Master Molty Foam v. Government of Pakistan (PLD 2005 SC 373)

(iii) Afteb Shaban Mirani v. Muhammad Ibrahim (PLD 2008 SC 779)

(iv) Accountant General Sindh v. Ahmed Ali U. Shaikh (PLD 2008 SC 522)

10. The learned counsel has also submitted that the exporters had not given them the actual sizes of the goods imported by the applicant and that they did not have been proper facility to measure the size of the goods. We do not comprehend to the above proposition made by the learned counsel for the simple reason that there is a marked contradiction in this statement as at para 5 of the Reference Application they have assailed that the exporters had not given them the exact sizes and in the same para they have asserted that they had to rely upon the seizes mentioned by the exporters.

11. It would not be out of place to mention that the applicant preferred a Constitutional Petition before this Court vide C. P. No.D-198/2008'wherein Nazir was appointed as Commissioner to inspect the consignment, who vide his report dated 12-7-2008 affirmed that the goods under question are not scrap rather the same consist of pipes and guarders. Moreover, the above mentioned petition was withdrawn by the then counsel of the applicant and the same was dismissed as not pressed on 28-8-2008 by this Court.

12. The learned counsel for the applicant has relied upon the decision in the case of Muzammil Ahmed quoted supra by submitting that the Member (Technical) has no jurisdiction to decide question of law sitting singly. On examination of the record we do not find that any question of law has been decided by the learned Member (Technical). From the reading of the question 1 to 4 we have found out that the Tribunal has decided the appeal on pure and simple appreciation of the fact that as admittedly no request for denaturing or mutilation was filed by the applicant as provided under the provisions of section 27A of the Act before filing of the GD, hence no benefit could be granted to the applicant. Therefore, in our considered opinion all the questions which are sought to be referred are based on the factual finding of the case and therefore, the present case does not fall within the ambit of the judgment as given by the learned bench in the case of Muzammil Ahmed quoted supra. As it is a trite law that while exercising advisory jurisdiction this Court has no jurisdiction to decide any question of fact or that of law which does not arise from the order of the Tribunal.

13. The learned counsel for the applicant has also relied upon the decision given by the Lahore High Court quoted supra but that decision in our view is not on all fours with the facts pertaining to the present reference application.

14. Hence in the light of the discussion made above, we do not find any merit in this reference application which is hereby dismissed in limine, along with the listed-applications.

S.A.K./R-/KReference dismissed in limine.