AUTOMOBILE CORPORATION OF PAKISTAN (PVT.) LTD. VS THE SECRETARY REVENUE DIVISION ISLAMABAD
2011 P T D 1590
[Federal Tax Ombudsman]
Before Dr. Muhammad Shoaib Suddle, Federal Tax Ombudsman
Messrs AUTOMOBILE CORPORATION OF PAKISTAN (PVT.) LTD.
Versus
THE SECRETARY REVENUE DIVISION ISLAMABAD
Complaint No.28/ISD/CUS(05)/213/2011, decided on 14/04/2011.
Customs Act (IV of 1969)---
----S. 168---Establishment of Office of Federal Tax Ombudsman Ordinance (XXXV of 2000), Ss.2(3), 9, 10 & 11---Seizure and confiscation of vehicle---Vehicle imported by the complainant was seized and confiscated by Customs Anti-Smuggling Unit vide order-in-original---Appeal filed by the complainant against order-in-original having been rejected by the Collector, complainant filed second appeal before Appellate Tribunal, which was accepted and Appellate Tribunal, directed Customs authorities to release vehicle in question---Despite said direction of the Appellate Tribunal, authorities not only failed to release the vehicle, but also threatened the complainant with seizure of the other vehicle of the complainant as well---Tribunal while passing judgment in favour of the complainant had observed that vehicle in question had been imported and sold by the complainant as per law---Non-release of vehicle in question without any stay order of the High Court, against the Appellate Tribunal's judgment in favour of the complainant, was unlawful, arbitrary and offensive, which was tantamount to maladministration---Recommendations, were made to Federal Board of Revenue, to ensure implementation of judgment of the Appellate Tribunal forthwith and release the vehicle to its lawful owner without any further delay; to investigate as to why the Federal Board of Revenue Officials were repeating maladministration again and again by refusing to implement orders/judgments of Appellate fora, without any stay order of superior fora, and make effective arrangements to forestall the chances of repetition of any such violation? in? future;?? and?? to?? report?? compliance,? within? 21? days.?
?????? Yasin Tahir, Senior Advisor Dealing Officer.
?????? Danish Ali Qazi Authorized Representative.
?????? Rashid Habib, DC, MCC, Peshawar Departmental Representative.
FINDINGS/RECOMMENDATIONS
DR. MUHAMMAD SHOAIB SUDDLE, FEDERAL TAX OMBUDSMAN.---Messrs Automobile Corporation of Pakistan (Pvt.) Ltd., Karachi, a private company, has alleged maladministration on the part of Customs Anti-smuggling Unit, Nowshera, as also the Noshwera police .? It? is? stated? that? the? Company? purchased? the? following? six Mercedez Benz ?vehicles? from? Messrs? Tools? and? Jigs? (Pvt.) Ltd.? on? 14-1-2005 which is stated to be a subsidiary of Kahuta Research Laboratories (KRL):
| Sr. No. | Engine No. | Chassis No. |
| 1 | 541922-00-037933 | WDB-9540332K311130 |
| 2 | 541922-00-037293 | WDB-9540332K309290 |
| 3 | 541922-00-038044 | WDB-9540332K311051 |
| 4 | 541922-00-009814 | WDB-9540332K250280 |
| 5 | 541922-00-010171 | WDB-9540332K250060 |
| 6 | 541922-00-012154 | WDB-9540332K250534 |
2.??? The vehicles are stated to have been imported by KRL through its commercial organization Messrs Tools and Jigs (Pvt.) Ltd., vide GD No.5366 dated 4-11-2003 (IGM No.598 dated 31-10-2003), and cleared free of Customs duty and taxes as 'Defence Stores' under S.R.O.358(I)/2002 dated 15-6-2002. After purchasing from KRL, the vehicles were sold in October, 2008, to Afghan refugees namely Messrs Abdul? Walid? Khan? and? Muhammad? Naeem? Khan,? both? residents? of? Azakhel,? Refugee? Camp,? Nowshera. One? of? thes e vehicles No.WDB-9540332K311051 was subsequently seized by Customs Anti-smuggling? Unit, Nowshera, and? confiscated? vide? Order-in-Original (O-in-O) No.131 of 2009 dated 7-7-2009. The said O-in-O was impugned before Collector (Appeals), who rejected the appeal. Second appeal was filed? by the owners before Customs Appellate Tribunal. Accepting the appeal, the Tribunal directed the Customs? vide? No.CUS-200/PB/2010? dated? 13-7-2010 to release the vehicle.
3.??? As the vehicle was not released despite the aforesaid judgment of the Tribunal, the complainant reminded the Customs vide his application dated 20-9-2010 to give appeal effect at the earliest. The Customs are alleged to have instead threatened the owners with seizure of the remaining vehicles as well. It is also alleged that the Nowshera Police also started harassing the owners. As a result, the vehicles stopped plying on the road for fear of seizure. In such view of the matter, the complainant has prayed for implementation of the judgment of the Tribunal and requested that the Customs Anti-smuggling Unit and Police at Nowshera be directed to refrain from threatening the owners.
4.??? The complaint was referred for comments to the Secretary Revenue Division as required under section 10(4) of the FTO Ordinance, 2000. In response, the Collector Customs, Peshawar filed parawise comments stating that they had already filed an appeal in the Hon'ble High Court, Peshawar, against the judgment of the Tribunal. The request of the complainant for release of the vehicle in pursuance of the impugned judgment of the Tribunal therefore was not maintainable. As regards five other vehicles, the Collector stated that since no other such vehicle was detained/seized, therefore, the assertion of the complainant about any threats was without substance. A copy of Collector's parawise comments was supplied to the complainant in the FTO Secretariat and his legal counsel filed a rejoinder. Parties were also heard on 7-4-2011 during which both DR and AR appeared and reiterated the averments of their written pleadings.
5.??? The complaint has been examined in the light of written and oral submissions of the parties. The Tribunal while passing judgment in favour of the complainant observed: "it is found that the Prime Mover has been imported and sold as per law and it is ordered to be released to the rightful owner. The case stands disposed of accordingly." As the operation of Tribunal's judgment has not been suspended by the Hon'ble High Court it is an established legal position that mere filing of appeal in a higher forum does not suspend judgment of the lower forum. The Hon'ble President of Pakistan has also confirmed this principle vide Order No.14/2007-Law(FTO) dated 31-1-2008 in the following words:--
?????? "It is trite rule that the appeal by itself does not have the effect of staying the operation of the order appealed against. Thus, the Customs' appeal before the High Court does not have the effect of staying the operation of the Additional Collector's O-in-O No.194 of 2005 dated 16-5-2005. The FTO's recommendation is in accord with law. It has been decided by the President in numerous cases that the Customs must implement the order of the lower forum unless its operation is stayed by the higher forum. The Customs can delay implementation of such order only during the period prescribed for making the appeal. After the expiration of the limitation for making appeal they should implement the order or obtain stay. This is the rule of law. We must respect it."
?????? FINDINGS:--
6.??? In view of the foregoing, non-release of the vehicle without any stay order of the Hon'ble High Court, against the Appellate Tribunal's judgment in favour of the complainant, is evidently unlawful, arbitrary and oppressive, and is tantamount to maladministration as defined under section 2(3)(i)(b) of the FTO Ordinance, 2000. As regards the complainant's prayer for issuing instructions to Nowshera Police, a copy of these findings along with a copy of the Tribunal's judgment shall also be endorsed to DPO Nowshera for appropriate legal action.
?????? RECOMMENDATIONS:
7.??? F.B.R.to-
(i)??? ensure implementation of the judgment of the Appellate Tribunal forthwith and release the vehicle to its lawful owner without any further delay, without prejudice to the final outcome at the level of Peshawar High Court;
(ii)?? investigate why the F.B.R. officials are repeating maladministration again and again by refusing to implement orders/judgments of appellate fora, without any stay order of superior fora, and make effective arrangements to forestall the chances of repetition of any such violation in the future; and
(iii)?? report compliance within 21 days.
H.B.T./152/FTO????????????????????????????????????????????????????????????????????????????????? Order accordingly.