SHOUKAT ALI VS SPECIAL JUDGE (CUSTOMS AND TAXATION), 2014 PTD-KARACHI-HIGH-COURT-SINDH 42 (2013)

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

----Ss.156(1), 179, 181 & 185-Constitution of Pakistan, Art. 199---Constitutional petition---Seizure of Oil Tanker carrying foreign origin High Speed Diesel---Registration of F.I.R. against three persons including Driver---Conviction of such persons by Special Judge (Customs and Taxation) while ordering confiscation and auctioning of Oil Tanker---Order-in-Original passed subsequently by Adjudicating Authority giving option to owner of Oil Tanker to redeem same on payment of redemption fine---Validity---Power to confiscate goods for violation of Customs Act, 1969 and allow its redemption on payment of fine vested in Adjudicating Authority under Ss.179 & 181 thereof---Department had not assailed order of Adjudicating Authority---Special Judge could only convict and sentence a smuggler and impose fine upon him, but had no jurisdiction to confiscate Oil Tanker---High Court directed release of Oil Tanker subject to compliance of order of Adjudicating Order.

Adam v. Collector of Customs, Karachi and another PLD 1969 SC 446; Muhammad Sarwar v. Federal Government of Pakistan and others 1998 PCr.LJ 213; State through Director-General, Pakistan Coast Guards, Turbat v. Sabro and another 1992 PCr.LJ 1795; Government of Pakistan thorugh Additional Secretary (Customs), Ministry of Finance, Islamabad and another v. Mahmood Ahmed Qureshi and another 2002 SCMR 1527 and Kifayatullah v. The Special Judge (Customs and Taxation), Karachi Spl. Criminal Appeal No.5 of 2012 rel.

(b) Constitution of Pakistan---

----Art.199---Constitutional petition---Alternate statutory remedy, availability of---Effect---Non-exercise of jurisdiction by High Court when alternate statutory available, not an absolute rule---Principles.

Where alternate remedy is provided for under any law, constitutional jurisdiction under Article 199 of the Constitution should be exercised with restraint, but such rule is not absolute. If an order is challenged on the ground that the same was wholly without jurisdiction or the person who had passed such order, was not at all competent to do so, an aggrieved person can invoke the constitutional of High Court.

Gatron (Industries) Ltd. v. Government of Pakistan and others 1999 SCMR 1072 and Collector of Customs (Valuation) and another v. Karachi Bulk Storage and Terminal Ltd. 2007 SCMR 1357 rel.

Aqeel Ahmed for Petitioner.

Ashiq Ali Anwar Rana for Respondent No.3.

Mohsin Imam, D.A.G. for Respondent No.2.

Date of hearing: 28th October, 2013.

JUDGMENT

MUHAMMAD JUNAID GHAFFAR, J.---The instant petition was allowed by us vide short order dated 28-10-2013 in the following terms:--

"Heard arguments. For the detailed reasons to be recorded later on, present petition is allowed and the respondents Nos.3 and 4 are directed to release Hino Oil Tanker bearing Registration No.TTA-582, Chassis No.12935, Engine No.13746 subject to compliance of order dated 30-4-2012 passed by the Adjudicating Authority."

2.The petitioner has filed the instant petition with the following prayers:--

(1)That this Honorable Court may be pleased to declare the Order 29-3-2012 as void, ab-initio and of no legal effect and set aside the same.

(2)That this Honorable Court may be pleased to direct the customs authorities not to auction the Oil Tanker till final disposal of this Petition.

(3)That this Honorable Court may be pleased to direct the customs authorities to release the Oil Tanker as per Order-in-Original No.127 of 2012 dated 30-4-2012.

(4)That this Honorable Court may be pleased to grant any other relief(s) which this Honorable Court may deem fit and proper in the circumstances of the case.

3.Briefly, facts in the instant petition are that the petitioner is the owner of Oil Tanker bearing Registration No.TTA-582. In its usual course of business the said Oil Tanker, while carrying 19000 liters of Iranian origin HSD oil was seized by S.H.O. Police Station Shershah, Karachi and after such seizure and arrest of the driver and two other persons, was handed over to the Directorate of Intelligence and Investigation FBR, Karachi, which is respondent No.3 in the instant petition. Subsequently the respondent No.3 lodged F.I.R bearing No. C.No.M-1648/DCI/Seiz/FIR/2012 dated 29-2-2012 before the Special Judge (Custom and Taxation), Karachi; where-after interim challan was also filed in the matter on 12-3-2012. At the trial of the case the three accused persons pleaded guilty before the Special Judge (Custom and Taxation), Karachi and vide judgment dated 29-3-2012, all the three accused persons were convicted for a period for which they had already undergone after their arrest and with fine of Rs.100,000 each. It was also ordered that if the amount of fine is not paid the accused shall suffer S.I. for two months each. Learned Special Judge (Custom and Taxation), Karachi while dealing with the property i.e. Oil Tanker ordered that same shall also be confiscated and auctioned in accordance with law and sale proceed thereof be deposited in government treasury.

4.The petitioner, who is purportedly the owner of the Oil Tanker in question, has assailed the findings of the learned Special Judge (Custom and Taxation), Karachi, whereby the same has been confiscated, in the instant petition.

5.Mr. Aqeel Ahmed, learned counsel for the petitioner has contended that the order of confiscation of the Oil Tanker passed by the learned Special Judge (Custom and Taxation), Karachi is without any lawful authority and jurisdiction as such authority of confiscation or otherwise, exclusively falls within the domain of the Customs Authorities under section 179 of the Customs Act, 1969. He further contended that in the adjudication proceedings, the adjudicating authority has already adjudicated the matter through an Order-in-Original bearing No.127 of 2012 dated 30-4-2012, which was passed on the basis of show-cause notice dated 14-4-2012 issued to the petitioner. His contention was, that in the said order-in-original after confiscation of the vehicle, the learned Additional Collector Adjudication had given an option to the owner of the oil tanker under section 181 of the Customs Act, 1969 read with S.R.O. 499(I)/2009 dated 13-6-2009 and Boards' letter dated 26-6-2006 to redeem the same on payment of redemption fine equivalent to 20% of the value of the vehicle in addition to payment of personal penalty of Rs.50,000. In view of this, the learned counsel for the petitioner prayed that the confiscated vehicle may be allowed to be released to the petitioner after payment of fine and penalty in accordance with the Order-in-Original dated 30-4-2012.

6.Mr. Ashiq Ali Anwer Rana, learned counsel for the respondent No.3 has not denied the fact that an Order-in-Original has been passed in the matter by the appropriate authority in terms of section 179 of the Custom Act, 1969, and the learned Special Judge (Custom and Taxation), Karachi has no jurisdiction in the matter. However, his preliminary objection was, that this petition is not maintainable as an appeal lies against the order of the learned Special Judge (Custom and Taxation), Karachi under section 185-F of the Customs Act, 1969 before the Special Appellate Bench of this Court which is presided over by a Single Judge of this Court.

7.Mr. Mohsin Imam learned D.A.G. appearing for the respondent No.2 has adopted the arguments of Mr. Ashiq Ali Anwer Rana and has contended that this petition is not maintainable as an alternate remedy was available to the petitioner by way of an appeal.

8.We have heard both learned counsel as well as learned D.A.G. and have also perused the record.

9.In so far as preliminary objection raised on behalf of the respondents is concerned, it is to be seen that in the given facts and circumstances of the instant case, whether the remedy available in terms of the provisions of the Customs Act, 1969 were to be availed by the petitioner; or the petitioner could invoke the Constitutional Jurisdiction of this Court under Article 199 of the Constitution of the Islamic Republic of Pakistan, 1973. Although it is a settled law, that where alternate remedy is provided for, under any law, writ jurisdiction under Article 199 of the Constitution should be exercised with restraint, but such rule is not absolute. If an order is challenged on the ground that the same was wholly without jurisdiction or the person who had passed such order, was not at all competent to do so, an aggrieved person can invoke the Constitutional jurisdiction of this Court under Article 199 of the Constitution of the Islamic Republic of Pakistan, 1973. There is a plethora of case-law on the subject, but reference can be made to a judgment of the Honorable Supreme Court of Pakistan in the case of Gatron (Industries) Ltd. v. Government of Pakistan and others reported in 1999 SCMR 1072. The relevant findings are reproduced as under:--

"Be that as it may, it is well-settled that the rule about invoking the Constitution jurisdiction only after exhausting all other remedies, is a rule of convenience and discretion by which the Court regulates its proceedings and it is not a rule of law affecting the jurisdiction. A Constitutional petition is competent if an order is passed by the Court or Authority by exceeding its jurisdiction even if the remedy of appeal/revision against such order is available, depending upon the facts and circumstances of each case. In the instant case, the appellant clearly stated in paragraph 15 of the writ petition the reasons for not exhausting the departmental remedies. In any event, the learned Judges of the High Court rendered the impugned judgment on merits of the case after hearing at length the submissions of the learned counsel for the parties. The appellants never pressed any objection as to the maintainability of the Constitutional petition before the High Court. Thus, visualized, the discretion exercised by the High Court, in the facts and circumstances of the case, to entertain the petition and decide it on merits does not suffer from any illegality." (Underlining is ours)

10.Similarlyin the case of Collector of Customs (Valuation) and another v. Karachi Bulk Storage and Terminal Ltd. reported in 2007 SCMR 1357, the Honorable Supreme Court of Pakistan has held as under:--

"4. Learned Advocate-on-Record for the petitioners reiterated that the impugned Judgment of the High Court is without jurisdiction as the respondent did not have recourse to remedies provided under the customs hierarchy and straightaway invoked extraordinary jurisdiction of the High Court. We are afraid, we cannot subscribe to this bald argument of the learned Advocate-on-Record as it is well-settled position in law that where the impugned order is found to be illegal, contrary to law or void ab initio, aggrieved person would be entitled to invoke the jurisdiction of the High Court under Article 199 of the Constitution without availing of remedies under the departmental hierarchy." (Underlining is ours)

11.The learned counselfortherespondentaswellaslearnedD.A.-G. have admitted that the learned Special Judge (Custom and Taxation), Karachi had no jurisdiction in the matter to order confiscation of the vehicle, as the confiscation of the same or otherwise, is to be regulated under section 179 of the Customs Act, 1969, by the relevant adjudicating authority. It is further noticed, that the petitioner who is the owner of the Vehicle in question, was neither served with any notice nor was provided any opportunity of hearing of explanation before passing of the order of confiscation by the learned Special Judge (Customs and Taxation), Karachi, which even otherwise renders the impugned order, a nullity in the eyes of law on the touchstone of Article 10A of the Constitution of the Islamic Republic of Pakistan 1973. Therefore, in view of the above, and as well as the dicta laid down by the Honorable Supreme Court of Pakistan in the above cited cases, the petitioner cannot be compelled to seek the remedy of appeal before the Special Appellate Bench of this court presided over by a Single Judge of this Court under section 185-F of the Customs Act, 1969, as the impugned order has been passed without jurisdiction and any lawful authority, as well as the law settled by the Honorable Supreme Court on the subject matter. Consequently, we hold that this petition is maintainable under Article 199 of the Constitution of the Islamic Republic of Pakistan, 1973.

12.Before adverting to the merits of the case, it would be advantageous to appreciate and examine the relevant provisions of section 179 and section 181 of the Customs Act 1969, which are reproduced hereunder:--

[179Power of adjudication.---[(1) Subject to subsection (2), in cases involving confiscation of goods or recovery of duty and other taxes not levied, short levied or erroneously refunded, imposition of penalty or any other contravention under this Act or the rules made thereunder, the jurisdiction and powers of the Officers of Customs in terms of amount of duties and other taxes involved, excluding the conveyance, shall be as follows namely:--

181 Option to pay fine in lieu of confiscated goods.-- Whenever an order for the confiscation of goods is passed under this Act, the officer passing the order may give the owner of the goods an option to pay in lieu of the confiscation of the goods such fine as the officer thinks fit.

Explanation.---Any fine in lieu of confiscation of goods imposed under this section shall be in addition to any duty and charges payable in respect of such goods, and of any penalty that might have been imposed in addition to the confiscation of goods [:]

[Provided that the Board may, by an order, specify the goods or class of goods where such option shall not be given:

Provided further that the Board may, by an order, fix the amount of fine which, in lieu of confiscation, shall be imposed on any goods or class of goods imported in violation of the provisions of section 15 or of a notification issued under section 16, or any other law for the time being in force.]

Perusal of the above provisions very clearly depicts that section 179 of the Customs Act, 1969 provides for confiscation of goods for violation of the relevant provisions of Act, whereas, section 181 allows the adjudicating authority to redeem the same on payment of fine, if any, however, subject to certain conditions (which are not relevant in this case) contained therein. Therefore, the Act is very clear and unambiguous on the subject and does not require much to dilate upon.

13.In so far as the learned counsel for respondent No.3 and learned D.A.-G. are concerned, they have not been able to controvert the contention raised by the learned counsel for the petitioner on merits of the case, and have only confined their arguments on the issue of maintainability of the petition. The Adjudicating Authority has passed an Order-in-Original bearing No.127 of 2012 dated 30-4-2012 under section 179 of the Customs Act, 1969, whereby the vehicle in question has been confiscated and thereafter allowed redemption of the same under section 181 of the Customs Act, 1969, on payment of redemption fine equivalent to 20% of the value of the vehicle in addition to payment of personal penalty of Rs.50,000 and such order has not been challenged any further by the respondents, whereas the petitioner through the instant petition is seeking the enforcement of the said Order-in-Original. The provisions of sections 179 and 181 of the Customs Act, 1969 are very clear and explicit on the issue. It is only the adjudicating authority appointed under section 179 ibid, who can order for confiscation of any goods including vehicles, for violation either of section 2(s), section 16, sections 32 and 32A, or any other relevant section, as the case may be, which are punishable under various clauses of section 156(1) of the Customs Act, 1969; whereas, the Special Judge (Customs and Taxation), has the authority to convict a person for imprisonment and also impose fine thereof under relevant clauses of section 156(1) of the Act ibid.The question as to whether the officers of the customs had any authority for ordering confiscation of the goods or the vehicle (property) was dealt with by the Honorable Supreme Court in the case of Adam v. Collector of Customs, Karachi and another reported in PLD 1969 Supreme Court 446, wherein the Honorable Supreme Court has observed as follows:--

" .. The intention of the Legislature is thus clear that the disposal of the goods seized under the Act is left entirely in the jurisdiction of the custom authorities. The proceedings taken by the custom authorities for the confiscation of the goods are more in the nature of departmental proceedings which have been characterized in English and American jurisprudence as proceedings in condemnation of the goods for purposes of revenue and are regarded as proceedings of a civil nature, despite their penal character ..."

This judgment of the Honorable Supreme Court was subsequently followed by a learned Single Judge of the Lahore High Court in the case of Muhammad Sarwar v. Federal Government of Pakistan and others reported as 1998 PCr.LJ 213 in the following terms:--

"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 of the same and the proceedings before the Customs Officers for the confiscation of the goods are departmental proceedings and such Customs Officers are not Judicial tribunals and that though 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."

Similarly in the case of State through Director-General, Pakistan Coast Guards, Turbat v. SABRO and another reported in 1992 PCr.LJ 1795,another Single Judge (Munawar Ahmed Mirza, C.J., as he then was) acting under the Appellate Jurisdiction under the Customs Act (Quetta) has observed as follows:--

" Therefore, in the peculiar circumstances question of adjudication vested in Custom forums as authoritatively determined by the Honorable Supreme Court in case Adam v. Collector of Customs Karachi and another P L D 1969 SC 446. It is quite evident that powers of Special Judge Customs are only restricted to trial of the accused who have committed offence for the violation of Customs Act.

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

14.Both these judgments of the learned Single Judges have been discussed and reproduced by the Honorable 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 reported in 2002 SCMR 1527, wherein the Honorable Supreme Court has observed as follows:--

"12.It was not legally proved that the respondent had brought said currency into Pakistan. On the contrary it was established that he was attempting to smuggle it out of Pakistan. It is an established law that criminal proceedings, before Special Judge are judicial proceedings while proceedings conducted before Custom Authorities relating to adjudication are in the nature of departmental proceedings, though in certain cases they emanate from the same subject-matter, yet, they are independent to each other and not necessarily, the findings recorded by Special Judge shall always control the findings recorded by the Custom Authorities relating to adjudication proceedings. These proceedings go side by side but do not mingle. The authoritative judgment on this point is reported as Adam v. Collector of Customs, Karachi (PLD 1969 SC 446), where in a Full Bench of this Court comprising four judges, including the then Chief Justice observed as follows:--

"Both are concurrent remedies but each is independent of the other. They cannot, therefore, be deemed to be mutually exclusive. Therefore, no question of double jeopardy arises when simultaneously or subsequently a trial is held to determine the guilt of the individual, who has been concerned in the offences in respect of the goods, which are the subject-matter of the adjudication proceedings. And since the proceedings for adjudication by the Customs Authorities and thecriminalprosecutionoftheoffenderintheCourtarenot interdependent, they can proceed simultaneously and neither can remain under suspension for the sake of the other.""

15.Subsequently, a learned Single Judge of this Court in the case of Kifayatullah v. The Special Judge (Customs and Taxation), Karachi, in Spl. Criminal Appeal No.5 of 2012 vide order dated 1-10-2012 after following the judgment of the Honorable Supreme Court of Pakistan in the case of Government of Pakistan v. Mahmood Ahmed Qureshi (Supra) has observed as follows:

"7.From perusal of the above referred judgment of the Hon'ble Supreme Court, it appears that the order of the Special Judge (Customs and Taxation) directing confiscation and auction of the confiscated vehicle, particularly when the adjudication proceedings are pending before the Customs Authorities, is erroneous in law and contrary to the ratio of the judgment of the Hon'ble Supreme Court. Accordingly, I hereby set-aside the impugned order of the Customs Court to the extent of confiscation and auction of subject vehicle i.e. Oil Tanker registration No.TLD-555.

8. The appellant shall be at liberty to seek release of the confiscated vehicle from the adjudicating authority or from the Customs, Excise and Sales Tax Appellate Tribunal, where the appeal of the appellant is pending disposal. Such request of the appellant shall be considered and appropriate order in accordance with law may be passed, preferably within two weeks, however, keeping in view the ratio of the judgment of Hon'ble Supreme Court and the directions as contained in the instant order. However, it is clarified that till such time the subject vehicle shall remain under the custody of the customs authorities. Instant appeal is hereby partly allowed in the above terms."

13.Therefore, in view of hereinabove and the law already settled in various decisions as referred above, we are of the view that the learned Special Judge (Custom and Taxation), Karachi had no lawful authority or jurisdiction to pass an order for confiscation of the vehicle in question and its subsequent auction, as such authority of confiscation or otherwise, and its redemption is vested with the adjudicating authority under the quasi-judicial proceedings being conducted under sections 179 and 181 of the Customs Act, 1969. Accordingly, the instant petition was allowed vide short order dated 28-10-2013 and these are the reasons for the same. Petition stands allowed.

SAK/S-116/KPetition accepted.