EVERLUCK ENTERPRISES VS FEDERATION OF PAKISTAN through Secretary, Revenue Division (FBR), Islamabad, 2013 PTD-KARACHI-HIGH-COURT-SINDH 471 (2012)

Customs Act (IV of 1969)---

----Ss.157, 168, 171, 180, 181, 185-B(b) & 185-C---Notification S.R.O. No.761(I)/2012, dated 21-6-2012---Constitution of Pakistan, Art.199---Constitutional petition---Special and general law---Applicability---Scope---Mis-declaration---Confiscation of goods and registration of F.I.R.---Scope---Petitioners were importers who were charged for mis-declaration and their imported goods were confiscated with the option to redeem the goods under S.181 of Customs Act, 1969---Authorities also got F.I.R. registered against petitioners, which were pendingtrial---Validity---Such provisions of Criminal Procedure Code, 1898, so far they were not inconsistent with the provisions of Customs Act, 1969, would apply to the proceedings of Court of Special Judge (Customs)---Process of adjudication or prosecution under Customs Act, 1969, like in any other special statute, was required to be in consonance with the provisions of Customs Act, 1969, whereas provision of Criminal Procedure Code, 1898, or any other law, could be invoked only to the extent as provided in the statute itself---Specific provisions were available under Customs Act, 1969, for the purposes of confiscation, seizure, auction and release of confiscated goods by adjudicating authorities, the same being part of Special law would prevail upon provisions of general law i.e. Criminal Procedure Code, 1898---Findings recorded by authorities, whereby release of goods were made subject to production of "No Objection Certificate" from the Court of Special Judge (Customs), were erroneous in law and the same were set aside---Goods which did not fall within the category of prohibited articles or the same were not smuggled goods, could not be considered as case property---Such goods, in absence of any order passed by adjudicating authority should be dealt with by Special Judge (Customs) in accordance with law---Petition was disposed of accordingly.

Government of Pakistan through Additional Secretary (Customs), Ministry of Finance, Islamabad and another v. Mahmood Ahmed Qureshi and another 2002 SCMR 1527; Adam v. Collector of Customs, Karachi PLD 1969 SC 446; Khuda-e-Nazar v. The State 1987 PCr.LJ 9; The State v. Ghulam Jaffar and others PLD 1970 Pesh. 66; Muhammad Sarwar v. Federal Government of Pakistan and others 1988 PCr.LJ 213 and State through Director General, Pakistan Coast Guards, Turbat v. Sabro and another 1992 PCr.LJ 1795 ref.

Zain A. Jaoti and Sameer Ghazanfar for Petitioners.

S. Mohsin Imam for Respondents Nos. 3 and 4.

Dilawer Hussain, Standing Counsel.

Date of hearing: 18th September, 2012.

JUDGMENT

AQEEL AHMED ABBASI, J.---Through this common judgment, we intend to dispose of the above mentioned petitions, which involve similar facts and require resolution of similar controversy by this Court.

2.Brief facts as stated in the instant petitions are that the petitioners imported different consignments, which were intercepted by the respondents. The petitioners were charged with mis-declaration of description, PCT heading and quantity of goods. The allegation of evasion of duty and taxes was made against the petitioners, whereafter adjudication proceedings were initiated and the order-in-original was passed by respondent No.4, whereby offending goods were ordered to be confiscated, however, the petitioners were given an option to redeem the confiscated goods under section 181 of the Customs Act, 1969 read with S.R.O. 499(I)/2009 dated 13-6-2009, on payment of fine equal to 35% of ascertained value, in addition to duty and taxes otherwise leviable. In addition to adjudication proceedings, an F.I.R. was also registered against the petitioners for above mentioned charges, which is pending adjudication before the Special Judge Customs Court.

3.Learned counsel for the petitioners has argued that pursuant to order-in-original passed in the case of the petitioners, the petitioners availed amnesty granted by the Federal Government of Pakistan, vide Notification i.e. S.R.O. No.761(I)/2012 dated 21-6-2012, whereby the amounts of fine, penalty and surcharge was remitted and the petitioners were required to pay the amount of duty and taxes, which according to learned counsel for the petitioners were paid in the government treasury on 30-6-2012 by the petitioners. Per learned counsel, on payment of duty and taxes under the amnesty as referred to hereinabove, the confiscated goods were required to be released to the petitioners, however, in view of restraining order passed by the respondent No.4, which reads as "However, as the criminal case in respect of the subject Show Cause Notice is pending before the Court of Special Judge (Customs), Karachi, release of goods (being case property) shall be subject to production of an NOC fromthe said Court (through the detecting Agency)", the goods have not yet been released to the petitioners.

4.It has been further contended by the learned counsel for the petitioners that the impugned finding of the respondent No.4 as referred to hereinabove paragraph is erroneous in law as the Special Judge (Customs), Karachi has no jurisdiction to pass an order of confiscation of goods, auction or its release under the Customs Act, 1969. Per learned counsel, the confiscation, auction or release of the confiscated goods falls within the domain of adjudicating authority, whereas the Special Judge (Customs) has no authority in law to pass such orders. Learned counsel has referred to the provisions of sections 157, 168, 171, 179, 180 and 181 read with section 185-B(b) and Section 185-C of the Customs Act, 1969 and submitted that the confiscation, auction or release of the confiscated goods is the part of independent adjudication proceedings, which are undertaken by the customs authorities, who are responsible to impose and collect duty and taxes, whereas the Special Judge (Customs) Court has the jurisdiction to conduct the criminal proceedings against the accused nominated therein and to punish the offender in accordance with law. It has been contended by the learned counsel for the petitioners that since the petitioners have availed the amnesty and have also paid duty and taxes, whereas the confiscated goods do not fall within the category of prohibited articles, therefore, the same are required to be released by the adjudicating authority without any intervention or condition of obtaining NOC from the Special Judge (Customs) Court. In support of his contention, learned counsel for the petitioners has placed reliance in the following judgments:

(1)Government of Pakistan through Additional Secretary (Customs), Ministry of Finance, Islamabad and another v. Mahmood Ahmed Qureshi and another 2002 SCMR 1527

(2)Adam v. Collector of Customs, Karachi PLD 1969 SC 446

(3)Khuda-e-Nazar v. The State 1987 PCr.LJ 9

(4)The State v. Ghulam Jaffar and others (PLD 1970 Peshawar 66).

5.On the other hand, Mr. S. Mohsin Imam, learned counsel for the respondents Nos.3 and 4 has submitted that since a criminal case is pending before the Special Judge (Customs) Court, therefore, the same may not be allowed to be released to the petitioners. It has been further contended that since the criminal proceedings are separate from adjudication proceedings, therefore, the Special Judge Customs Court can pass orders regarding confiscation, auction or release of such goods. However, while confronted with legal provisions relating to confiscation, auction and release of the confiscated goods as provided under the Customs Act, 1969 and the ratio of the judgments relied upon by the learned counsel for the petitioners, learned counsel for the respondents could not controvert such legal position. On a query of this Court with regard to any provision of law which may impose any condition for obtaining NOC for the release of confiscated goods by the Special Court Customs, learned counsel for the respondents could not refer to any such provision of law under the Customs Act, 1969.

6.Mr. Dilawer Hussain, learned Standing Counsel adopted the arguments of the learned counsel for the respondents, however, could not dispute the legal position emerging from the perusal of the statutory provisions and the case-law as referred and relied upon by the learned counsel for the petitioners.

7.We have heard both the learned counsel, perused the record and examined the case-law relied upon by the learned counsel for the petitioners. It will be advantageous to reproduce hereunder paras. 13 and 14 of the judgment of the Hon'ble Supreme Court in the case of Government of Pakistan through Additional Secretary (Customs), Ministry of Finance, Islamabad and another v. Mahmood Ahmed Qureshi and another 2002 SCMR 1527, which reads as follows:--

"13. Relying upon aforesaid judgment, learned High Court in the case reported as Muhammad Sarwar v. Federal Government of Pakistan and others (1988 PCr.LJ 213), authored by Mr.Justice Rustam S. Sidhwa, in para 20, observed as follows:--

"20. In the instant case, the right of the Special Judge, Customs, to punish the petitioner for smuggling and that of the Customs Officers to adjudicate whether the smuggled goods should be confiscated, both arise out of the same provision of law, namely item (89) of subsection (1) of section 156 of the Customs Act, 1969. As held by the Supreme Court in Adam's case (PLD 1969 SC 446), the proceedings before the Special Judge are judicial proceedings for the determination of the guilt of the person concerned for committing the act of smuggling and entailing a punishment of imprisonment for the same and the proceedings before the Customs Officers for the confiscation of the goods are departmental proceedings and such Custom Officers are not Judicial Tribunals and that through the State has concurrent remedies, but each is independent of the other and they cannot be termed to be mutually exclusive. Earlier, the Supreme Court in Messrs S.A.Haroon and others v. The Collector of Customs, Karachi and the Federation of Pakistan (PLD 1959 SC 177 at 201) had held that though the Adjudicating Officer was not a judicial tribunal, yet principles of natural justice applied before him, as proceedings before him were at least of a quasi-judicial character, if not of a judicial character."

14.On above point in the case reported as State through Director General, Pakistan Coast Guards, Turbat v. Sabro and another (1992 PCr.LJ 1795) authored by Munawar Ahmed Mirza, C.J., as he then was, relying upon the case of Adam (supra) he held as follows:--

"However, adjudication of property subject-matter of seizure exclusively falls within the domain of Customs Authorities contemplated by sections 179 and 181 of the Customs Act."

8.In the case of Khuda-e-Nazar v. The State reported as 1987 PCr.LJ 9, learned Single Judge of this Court while dealing similar provisions of the Customs Act, 1969 has held as follows:--

"In case adjudication proceedings are pending or even if a notice had been issued under section 168 of the Customs Act by the Customs Authorities in respect of the offending goods, the competent authority for passing an order for disposal of the property would be the Customs Authorities and not the learned Special Judge. This is so, as in respect of the disposal of properties there should not be two different authorities who should be competent to pass such orders as it may then result in conflicting or contradictory orders. In case, however, no proceedings are pending before the Customs Authorities for adjudication, and the matter has only gone before the learned Special Judge for trial of the offender under the provisions of the section 156 of the Customs Act, in my view, the learned Special Judge, Customs, would be the authority to pass an order under section 517, Cr.P.C. read with section 185-C of the Customs Act for disposal of the property."

9.From perusal of the provisions of section 157 and various sections as contained in Chapter XVIII of the Customs Act, 1969 relating to powers of search, seizure, arrest and adjudication of offences, it is observed that the powers to confiscate, seize, auction and release of confiscated goods vests in the adjudicating authority and the forums provided under the Customs Act, 1969 for such purpose. Whereas, in terms of section 185-C of the Customs Act, 1969, it has been provided that the provisions of Code of Criminal Procedure, 1898, (Act V of 1898), so far as they are not inconsistent with the provisions of this Act, shall apply to the proceedings of the court of a Special Judge. Process of adjudication or prosecution under the Customs Act, 1969, like in any other special statute, is required to be in consonance with the provisions of Customs Act, 1969, whereas provisions of Criminal Procedure Code or any other law, can be invoked only to the extent as provided in the statute itself. Since there are specific provisions provided in the Customs Act, 1969 for the purposes of confiscation, seizure, auction and release of the confiscated goods by the adjudicating authorities the same being part of Special Law shall prevail upon the provisions of general law i.e. Criminal Procedure Code.

10.The Hon'ble Supreme Court in the case of Government of Pakistan through Additional Secretary (Customs), Ministry of Finance, Islamabad and another v. Mahmood Ahmed Qureshi and another 2002 SCMR 1527;Court has approved the finding recorded by Munawar Ahmed Mirza, C.J (as he then was) in the case of State through Director General, Pakistan Coast Guards, Turbat v. Sabro and another (1992 PCr.LJ 1795) to the effect that adjudication of property subject-matter of seizure, exclusively falls within the domain of Customs Authorities contemplated by sections 179 and 181 of the Customs Act.

11.Keeping in view the above referred provisions of law and respectfully following the dicta laid down by the Hon'ble Supreme Court in the above referred judgments, we are of the view that the impugned finding recorded by the respondent No.4 whereby release of goods (being case property) has been made subject to production of an NOC from the Court of Special Judge (Customs), Karachi, is erroneous in law, which is hereby set aside. We may further observe that the goods, which do not fall within the category of prohibited articles or the same are not smuggled goods, cannot be considered as case property. Such goods, in the absence of any order passed by the adjudicating authority, may be dealt with by the Special Judge (Customs) in accordance with law. Accordingly, the petitioners are at liberty to seek release of the confiscated goods from the adjudicating authority or from the forums provided under the Customs Act, 1969, who shall pass appropriate orders in accordance with law preferably within a period of one week from the date when the petitioners may approach them for such purpose.

Petitions are disposed of in the above terms along with listed application.

MH/E-8/KOrder accordingly.