FARID KHAN VS DEPUTY COLLECTOR (ADJUDICATION) ALLAMA IQBAL INTERNATIONAL AIRPORT, LAHORE, 2014 PTD-CUSTOMS-APPELLATE-TRIBUNAL-LAHORE 237 (2013)

Customs Act (IV of 1969)---

----Ss.2(s), 3(1)(3) 16, 18 & 156(1)(89)---Imports and Exports (Control) Act (XXXIX of 1950), Ss.3(1) & 3---Allegation of "Smuggling"---Goods of foreign origin loaded on truck going from Lahore to Rawalpindi---Seizure and confiscation of such goods for being non-duty paid and smuggled one on ground that imports documents produced by appellant did not tally therewith---Dismissal of appeal by Appellate Authority---Validity---Import documents produced by appellant showing such goods to have been imported from U.A.E. and Malaysia stood corroborated by reconciliation report produced by department---Nothing on record was available to show that such goods had been either imported from any other country or brought into Pakistan through an un-authorized route without payment of duty and taxes---Department had failed to reput billties of such goods produced by appellant showing booking thereof from Karachi to Lahore---Such goods, in absence of any solid proof, would not fall within ambit of S.2(s) or definition of "smuggling" as given in Customs Act, 1969---Appellate Tribunal set aside lower appellate order and order-in-original in circumstances.

Adnan Ahmad Ch. for Appellant.

Mubarak Ali Sherazi I.O. for Respondents.

Date of hearing: 4th September, 2013.

JUDGMENT

CH. MUHAMMAD ASGHAR PASWAL (MEMBER JUDICIAL).---This appeal is directed against Order-in-Appeal No.82 of 2013, dated 2-4-2013 passed by the Collector of Customs (Appeals), Lahore.

2.Brief facts of the case are that the staff of Customs Intelligence and Investigation, Lahore intercepted a Truck No.RIC-8858 loaded with foreign origin miscellaneous goods, near Pir Makki Road, Bhatti Gate, Lahore going from Lahore to Rawalpindi. On query, the driver of the truck identified himself as Ihtisham-ul-Haq son of Muhammad Azeem R/o Abbottabad. The said vehicle was examined in the presence of respondents and other witnesses, which led to the recovery of the goods

On demand the driver produced certain Bilties Nos.8166, 8172, 8148, 7972, 8588 and 8107 dated 10-5-2012 issued by Messrs New Raftar Hazara Goods Forwarding Agency, Lahore regarding booking of loaded goods. But he could not produce any import documents regarding loaded foreign origin beauty soap. However, on the request of the said driver, foreign origin soap booked against Bilty No.8107 dated 10-5-2012 consignor nil and consignee Saif-ur-Rehman was off loaded and detained under the provisions of Customs Act, 1969. The truck along with local goods was handed over to the said driver to proceed his destination. On 11-5-2012 one person namely Fareed Khan R/o Swabi appeared in the office of the detecting agency and claimed the ownership of the detained soap. Notice under section 26 of the Customs Act, 1969 was served upon him to produce relevant import documents and Sales Tax record maintained under section 211 of the Customs Act, 1969 and Customs Rule No.126 etc. In reply to the said notice dated 11-5-2012, the said Fareed Khan produced G.D. No.CRN-I-HC-2015089-011211 in which importer was Messrs Kazmi Enterprises, Karachi and GD No.KCSI-HC-49045 dated 14-4-2012 in which the importer was Messrs Polymer Trader Corporation, Karachi. The documents produced by the appellant were carefully examined and compared with the detained goods. It was revealed that the same did not tally with the said goods. There were sufficient reasons to believe that the detained soap was non-duty paid and smuggled one thus, falling under section 2(s) of the Customs Act, 1969. Therefore after fulfilling all legal formalitiesthesamewasseizedon16-5-2013 under Section 168 after serving notice under section 171 of the Customs Act, 1969 punishable under Section 156(1) 89 of the Customs Act, 1969 for contravention of the sections 2(s) 16 and 18 of the Customs Act, 1969 read with section 3(1) & (3) of Imports and Export (Control) Act, 1950. The adjudicating authority was of the view that it is established without any shadow of doubt that the seized soap is smuggled one. It has also been observed that the soap is notified under S.R.O. 566(I)/2005 dated 6-6-2005. The adjudicating authority ordered for outright confiscation of the seized 1199-cartons of seized foreign origin soap under section 156(1)89 of the Customs Act, 1969. The appellant feeling dis-satisfaction of the said orders, filed appeal before the learned Collector (Appeals) Lahore who, also dismissed the same. Aggrieved by the said order the appellant filed the present appeal before this Tribunal on the following grounds:--

(1)That the impugned orders are against the law and facts of the case and the decision under challenge proceeds on wrongful assumption to the material facts of the case.

(2)That the respondents has not issued notice under section 171 of the Custom Act, 1969 at the spot, hence the seizure of the goods in breach of the mandatory provisions of section 171 of the Custom Act, 1969 is liable to be declared illegal and unlawful.

(3)That the order-in-Original passed by Adjudicating officer is bad in law being passed in violation of section 179(3) of the Customs Act, 1969 and no reason of delay was mentioned in order-in-original. Hence the impugned order-in-original has no legal effect being barred by time as prescribed in Law and is liable to set aside.

(4)That the Collector appeal with out considering the question of law as well as facts taken by the appellant in his appeal and without giving his finding on such grounds/question passed the. impugned order-in-appeal in cyclostyle and slipshod manner which is against the spirit of law, hence the impugned order is liable to be set-aside.

(5)That the Collector appeal has not applied its independent mind to the facts/documents of the case for which the court was required under the law, hence the impugned order is liable to be set-aside.

(6)That the impugned order is totally divorced from the facts, contrary to the law and passed in violation of section 193-A subsection (4) of Customs Act, 1969, hence the impugned order is liable to be set-aside.

(7)That the goods detained by the respondents are not restricted or banned in Import and Export Policy Order nor any notification is issued in this regard while appellant has imported the goods after fulfilling all legal formalities and paid tax and duties thereon. Hence detention/seizure of imported soap is totally illegal and unlawful.

(8)That the respondents on one side in seizure report and SCN indicated that the soap detained by them imported from UAE and on other side when the respondent submitted reconciliation report elaborated that the said soap imported from U.A.E and Malaysia which is clearly proving the version of the appellant and on very first day the appellant produced bill of entries of said soap which were imported from U.A.E and Malaysia but the respondent refused the appellant on the ground that the same did not tally with the said soap and there is no mentioned/ pointed out any discrepancy regarding this by the respondents but the forum below totally ignored this important fact of the case and passed the impugned orders which are liable to be set-aside.

(9)That the said soap detained by the respondents was imported and still owned by the Importers namely Kazmi Enterprises and Polymer Trade Corporation and appellant being agent of said importers look after their business in Punjab and in this regard the said importers submitted undertaking/affidavits before adjudicating officer and also attached with appeal filed before collector appeal but the adjudicating officer as well as collector appeal have failed to appreciate this fact and wrongly held in impugned order that the appellant failed to produced the sales tax invoice, which liable to be set-aside.

(10)That the goods are genuine imported which are crystal clear from copies of the bill of entries and other import document but the respondents has not considered the said documents and passed the impugned orders in slip shod manner which are liable to be set-aside.

(11)That the bilty indicate 1200 Cartons of soap but the seizure memo. shows 1199 Cartons and usurp one Carton of soap which is totally illegal and unlawful.

(12)That the appellant provided so many imported documents to the respondents but seizure memo. indicate only two bill of entries and also alleged that the said documents do not tally with the detain goods which is mala fide of the respondents.

(13)That initially the respondents lingered on the matter on one or the other pretext and being aggrieved from the behavior of the respondents the appellant has filed writ petition in Honorable Lahore High Court Lahore and due to this grudge the respondents decide the matter against the appellant which is illegal and unlawful. That the respondents wrongly assessed the Customs Duty and other taxes on presumption basis and totally ignored the Ruling No. 427 dated 8-2-2012 issued under section 25-A of the Customs Act, 1969 which is clearly shown the mala fide of the respondents Nos. 2 and 3.

(14)That it is well settled law the valuable rights of the parties could not be taken away without following legal formalities and in present case the respondents have not made single efforts to approach the importers for fair decision of the case and wrongly held that the importers never claimed any link with the seized goods and the appellant, hence the impugned order is liable to be set-aside.

(15)That the said act on the part of the respondents, which is other wise than in accordance with law, has taken away the rights of the appellants for conduction of lawful trade or business guaranteed under Article 18 of the Islamic Republic of Pakistan, 1973. Reliance is placed at 2008 CLC 1132.

(16)That there is not an iota of evidence in support of the allegation that the seized soap was brought into Pakistan through an unauthorized route with out payment of duty and taxes and hence not fall within the definition of "smuggling" under section 2(s) of the Customs Act, 1969. Furthermore the appellant has provided all relevant documents to prove his version but the respondents totally ignored the said documents.

(17)That the respondents forced the appellant to pay duty and taxes which has already been paid by the appellant at import stage, hence the goods already out of charge detained by the respondents without complying the mandatory provisions of sections 168 and 171 of the Customs Act, 1969. Hence the act of the respondents liable to be declared illegal and unlawful.

(18)That the respondents illegally and unlawfully without having lawful authority have cause illegal harassment to the appellant and the impugned orders have been passed mere on presumption bases and no inquiry/efforts whatsoever has ever been initiated.

(19)That the respondents while passing the impugned orders have not applied their judicious mind and passed the impugned order in utter violation of Article 24-A of the General Clause Act, 1897.

I have heard learned counsel for the appellant as well as learned Departmental Representative for the respondent and perused the record available before me. I find that the respondent department in reconciliation report dated 10-12-2012 admitted the fact that the soap was imported from U.A.E and Malaysia also proves the stance/version of the appellant. Further the GDs produced by the appellant also proves that the goods were imported from U.A.E and Malaysia, and not rebutted by the respondent. The respondent stance that the said GDs do not tally with the said soap carry no weight because in this regard the respondent failed to produce any evidence against the appellant which could show that the soap was imported from any other country/origin. There is not an iota of evidence in support of the allegation that the seized soap was brought into Pakistan through an un-authorized route without payment of duty and taxes. So without any solid evidence it can not be said that the goods in question fall within the ambit of section 2(s) of the Customs Act, 1969 or the definition of " Smuggling " . Further the bilities produced by the appellant were also not rebutted by the departmental representative that the goods were not booked from Karachi to Lahore which also proved that the impugned soap was legally imported. The departmental representative also could not say anything regarding the GD No.KCSI-HC49045 dated 14-4-2012, GD No.CRN-I-HC2015089-011211and GD No.CRN-I-HC1907194-010811 produced by the appellant which show that the same were fully matched with detained soap as mentioned in Seizure Report S.No.2 as well as reconciliation report dated 10-12-2012.

In view of the above, I find no force in the arguments advanced by the respondent side, so the impugned order in original as well as order-in-appeal are set aside and the present appeal is hereby accepted. Parties be informed through registered post A.D. or by UMS.

File be consigned to the record after completion.

SAK/176/Tax(Trib.)Appeal accepted.