BILAL INTERNATIONAL VS FEDERATION OF PAKISTAN through Secretary Revenue Division/Chairman, 2014 PTD-KARACHI-HIGH-COURT-SINDH 465 (2013)

Customs Act (IV of 1969)---

---S.80---Import Policy Order, 2013---Constitution of Pakistan, Art.199--Constitutional petition---Factual controversy---Goods declaration---Scrutiny---Importer was aggrieved by customs examination report as his goods declaration was selected for security---Plea raised by importer was that old and used rubber conveyor belts were exempted from import duty---Validity---Question raised by importer could not be decided as it involved a factual controversy, which High Court could not look into in its Constitutionaljurisdiction---Question that as to whether goods in question were for "ground handling equipment" or not was to be determined by Adjudicating Collectorate and before such factual determination was done, question of interpreting applicability of restricted list of Import Policy Order, 2013, could not be decided---Petition was dismissed in circumstances.

Iqbal Hussain v. Federation of Pakistan 2010 PTD 2338; Commissioner of Income Tax v. MessrsEli-Lilly Pakistan Private Ltd., 2009 PTD 1392; Collector of Customs, Custom House Lahore v. S. M. Ahmed and Co (Pvt.) Limited, 1999 SCMR 138 andKamran Industries v. Collector of Customs (Exports) PLD 1996 Kar. 68 distinguished.

Commissioner of Income Tax, Companies-II and another v. Hamdard Dawakhana (WAQF), Karachi PLD 1992 SC 847; The Commissioner of Income Tax, Karachi and 2 others v. Messrs N.V. Philip's Gloeilampenfabriaken PLD 1993 SC 434; Messrs Bulk Shipping and Trading (Pvt.) Ltd., v. Collector of Customs and others 2004 PTD 509; Arshad Hussain v. Collector of Customs and 2 others 2010 PTD 104; BP Pakistan Exploration and Production Inc., Karachi v. Additional Commissioner,InlandRevenue-BEnforcementandCollectionDivision-I, Karachi and another 2011 PTD 647and Messrs Pak Saudi Fertilizers Ltd., v. Federation of Pakistan 2002 PTD 679 ref.

Faisal Rasheed Ghouri for Petitioner.

Saeed A. Memon Standing Counsel.

Kashif Nazeer for Respondents Nos. 2 to 4.

Date of hearing: 27th November, 2013.

JUDGMENT

MUHAMMAD JUNAID GHAFFAR, J.---The petitioner through the instant petition has challenged the issuance of the Show-Cause Notice dated 12-9-2013 by the respondent No.4 and has claimed the following reliefs:-

(a)Declare that the Show-Cause Notice CN-123768-30082013 dated 12-9-2013 is discriminatory under Article 25 of the Constitution of Pakistan and arbitrary, capricious, mala fide, illegal, unlawful and without jurisdiction which is in violation of several constitutional rights as well as fundamental rights of the petitioner as guaranteed under Articles 4, 10-A, 18 and 25 of the Constitution;

(b)Declare that Impugned Goods "Old & Used Rubber Conveyor Belts" are not restricted items under Part-II of Appendix B read with Appendix J to the Import Policy Order, 2013 and/or freely importable;

(c)DeclarethatShow-Cause Notice CN-123768-3008213dated12-9-2013 is self-contradictory and oncethe respondents have admitted the goods being "old & used" the assessment for the purpose of duties and taxes on the value of "unused" goods is illegal, mala fide and nullity in the eyes of law;

(d)Declare that the Show-Cause Notice CN-123768-3008213 dated 12-9-2013 is faulty and ambiguous without specific allegation of mis-declaration, fiscal fraud and/or prior knowledge of petitioner and mere citing the provision of Customs Act, 1969 could not establish the charge against the petitioner;

(e)Declare that the impugned goods be immediately released on declared value of "old and used rubber conveyor belts" after payment of duty and taxes without payment of demurrages and charges incidental thereto;

(f)Grant any other relief the Hon'ble Court deemed just and proper in the circumstances of the case;

(g)Grant cost of the petition as the petitioner would have to bear great cost in the mode of container rent".

2.Briefly, the facts as stated in the memo. of petition are, that the petitioner who is engaged in the business of commercial imports of power tools, hand tools and old and used rubber conveyor belts has imported a consignment of old and used rubber conveyor belts under PCT Heading 4010.1900 and accordingly filed the goods declaration ("G.D") NO.KAPE-HC-9400-05-08-2013.The said GD was selected for scrutiny in terms of section 80 of Customs Act, 1969, ("The Act") and as per customs examination report the goods were found to be "(1) Used Rubber Conveyor Belting (100% serviceable) Net Wt. 13290 kgs (Approx.)(1A) Unused Rubber Conveyor Belting Net Wt. 6600 Kgs (Approx).It is stated that the petitioner was aggrieved with such examination report and hence requested for re-examination of the goods which was accordingly allowed and after the re-examination the following report was endorsed:--

"Re-examined the goods previous report is found correct (1) Used Rubber Conveyor Belting (100% serviceable) Net Wt. 13290 kgs (Approx.) (1A) Unused Rubber Conveyor Belting Net Wt. 6600 Kgs (Approx)."

3.The petitioner was again not satisfied by the second examination report and once again requested for re-examination through R & D department of respondent No.3 and on such request being allowed, the goods were once again jointly re-examined by the shed staff as well as the staff of the R & D department.According to the petitioner on such re-examination the stance taken by the petitioner was admitted and the declared description of the goods i.e. "old & used rubber conveyor belts" was accepted. However, according to the petitioner the respondents with mala fide intention objected for the first time as to the import status of the goods and termed them as being restricted items as notified vide Serial No.12 of Appendix "J" to the Import Policy Order ("IPO") 2013.Consequently a Show-Cause Notice dated 12-9-2013 was issued by the respondent No.4, whereby it has been alleged that the subject goods being a restricted item, could not be imported freely and hence the petitioner has violated the provision of sections 16, 32(1), 32(2) and 32(A) of the Act.It is further stated that the petitionerreplied to the said show-cause notice vide its replies dated 18-9-2013 and 1-10-2013 but till the filing of the instant petition, the matter is still pending before respondent No.4 and has not been finalized as such the petitioner is left with no other remedy but to seek indulgence of this Court under the Constitutional jurisdiction.

4.Mr. Faisal Rasheed Ghouri Advocate, appearing on behalf of the petitioner, contended that the show-cause notice issued by the respondent No.4 is arbitrary, capricious, mala fide, illegal, unlawful and without jurisdiction.It was further contended that the respondents have allowed clearance of the same goods to various other importers and hence the impugned action of the respondents amounts to discrimination as envisaged under Article 25 of the Constitution of Islamic Republic of Pakistan. The learned counsel further contended that the show-cause notice was ambiguous and violative in the eyes of law as there was no specific allegation of mis-declaration and/or fiscal fraud; therefore, mere citing the various provisions of the Act, the charges as alleged could not be established against the petitioner.Learned counsel contended that the instant goods were old and used conveyor belts and by no stretch of imagination, they could be termed as "ground handling equipment's" which are included in the restricted items under the IPO, 2013.Learned counsel also disputed the alleged enhancement of value of the consignment as stated in the show-cause notice, asthe value so assessed by the respondents in fact pertain to new conveyor belts, whereas the petitioner had imported old and used conveyor belts.The learned counsel also contended that the respondent No.4 had no jurisdiction in the matter as in view of S.R.O. 886(I)/2012 dated 18-7-2012, the jurisdiction and authority of adjudication vests with the Adjudication Collectorate, especially created under the above S.R.O. (with respect, this objection was raised at the time of hearing of the instant petition as this is not part of the pleadings/prayer). Learned counsel lastly contended that no factual controversy was involved in the matter and it was only a question of interpretation which was required to be done by this Court, hence the instant petition was maintainable.The learned counsel relied upon the cases of Iqbal Hussain v. Federation of Pakistan, reported as 2010 PTD 2338, Commissioner of Income Tax v. MessrsEli-lilly Pakistan Private Ltd., reported as 2009 PTD 1392, Collector of Customs, Custom House Lahore v. S. M. Ahmed & Co (Pvt.) Limited, reported as 1999 SCMR 138, Kamran Industries v. Collector of Customs (Exports) reported as PLD 1996 Kar. 68.

5.The respondents have filed comments and have raised preliminary objection as to the maintainability of the instant petition, as the petitioner has bypassed the ongoing adjudication proceedings being carried on in terms of section 179 of the Act; hence the petition was not maintainable.It is further stated that the petitioner has failed to comply with the restrictions as per Serial No.26 of Part-II of Appendix-B and Serial No.12 of Appendix-J of IPO, 2013; therefore, in terms of paras 5(B) and 6 of IPO, 2013, read with sections 16 and 17 of the Act the goods in question could not be allowed to be released. It is further stated that sole ground raised by the petitioner is that the used conveyor belts have been previously cleared by the Customs Authority and therefore, the petitioner's consignment be also released, is not maintainable as two wrongs cannot make a right, and based on these submissions, it is prayed by the respondents that the instant petition be dismissed.

6.Mr. Kashif Nazeer, learned counsel appearing on behalf of the respondents Nos.2 to 4 contended that since the show-cause notice has already been issued in the matter and the petitioner has already submitted to the jurisdiction of the adjudicating authority by filing reply to the show-cause notice, therefore the instant petition is not maintainable as it is a settled position that if once an alternate remedy has been availed by a person then the writ jurisdiction of the Court could not be invoked.Per learned counsel the consignment imported by the petitioner is of conveyor belts for ground handling equipment, which is a restricted item under the IPO, 2013, as such is not freely importable and the petitioner has violated the provision of Section 16 of the Act read with Section 3 of the Import and Export Control Act, 1950. The learned counsel further contended that factual controversy was involved in the matter and the same can only be decided by the adjudicating authority hence the petitioner may be directed to approach the relevant authority before whom the petitioner has already filed the reply to the show-cause notice.Finally the learned counsel contended that there was no estoppel against the law and no discrimination was being done with the petitioner.The learned counsel in support of his arguments relied upon the cases of Commissioner of Income Tax, Companies-II and another v. Hamdard Dawakhana (WAQF), Karachi, reported as PLD 1992 SC 847, The Commissioner of Income Tax, Karachi and 2 others v. Messrs N.V. Philip's Gloeilampenfabriaken, reported as PLD 1993 SC 434, Messrs Bulk Shipping and Trading (Pvt.) Ltd. v. Collector of Customs and others, reported as 2004 PTD 509, Arshad Hussain v. Collector of Customs and 2 others, reported in 2010 PTD 104, BP Pakistan Exploration and Production Inc., Karachi v. Additional Commissioner, Inland Revenue-B Enforcement and Collection Division-I, Karachi and another, reported in 2011 PTD 647.

7.Mr. Saeed A. Memon, learned standing counsel has adopted the arguments advance by the learned counsel for the respondents.

8.We have heard both the learned counsel, perused the record and the case-law referred to as above. By consent of the both the learned counsel the instant petition is being heard and decided at Katcha Peshi stage.

9.At the very outset we would like to address the preliminary objection raised by the learned counsel for the respondents regarding the maintainability of the instant petition.It is an admitted fact that after filing of the GD and its examination by the officers' of the respondents, an objection was raised regarding the import status of the goods.Consequently, based on this objection a show-cause notice dated 12-9-2013 has been issued by the respondent No.4.The petitioner after receipt of the show-cause notice has filed its replies dated 18-9-2013 and 1-10-2013 before the respondent No.4.It appears that during the pendency of the adjudication proceedings and while the matter was being decided by the respondent No.4, the petitioner has chosen to file the instant petition under Article 199 of the Constitution of Islamic Republic of Pakistan.Although no satisfactory answer has been put forth on behalf of the petitioner that as to why after opting to participate in the adjudication proceedings, the instant petition has been filed and the alternate remedy available and availed by them has been abandoned.The only ground urged by the learned counsel for the petitioner in this regard is, that in terms of S.R.O. 886(I)/2012 dated 18-7-2012, the respondent No.4 has no jurisdiction in the matter and the appropriate jurisdiction by virtue of Serial No.2 of the table mentioned in the above S.R.O. lies with the Collector, Collectorate of Customs (Adjudication Karachi II).It has been urged by the learned counsel that since sections 32(1), (2) and 32(A) of the Act, have been mentioned in the body of the show-cause notice, as such the jurisdiction exercised by the respondent No.4 in terms of Clause 3(d) of the above referred S.R.O. has been wrongly assumed by the respondent No.4.However, the learned counsel was unable to satisfy as to how this Court can issue a writ under Article 199 of the Constitution once a show-cause notice has been issued and the petitioner without raising any such objections, at the very first instance, and having participated in the proceedings, can invoke the writ jurisdiction of this Court.We have also gone through the replies furnished by the petitioner before the respondent No.4 dated 18-9-2013 and 1-10-2013 available at pages 29-32 of the Court file and have noticed that the petitioner has not raised any objection as to the assumption of jurisdiction by the respondent No.4. Further, the objection of jurisdiction has only been argued at the time of hearing of the petition and is not averred in the memo. of petition nor there is any specific prayer in this regard. Hence we are of the view that the objection regarding jurisdiction has raised as an afterthought and to cure the objection regarding the maintainability of the instant petition. In this context it would be advantageous to refer to the judgment of the Hon'ble Supreme Court in the case of Commissioner of Income Tax v. Hamdard Dawakhana (Waqf) KHI, (supra) in which it has been observed that in case where any party resorts to statutory remedy against an order, then the same could not be abandoned or by-passed without any valid and reasonable cause and cannot file constitutional petition challenging the same action. The Hon'ble Supreme Court has further held that such practice, in case when statute provides alternate and efficacious remedy up to the High Court could not be approved or encouraged. In the case of Arhsad Hussain (Supra), a Division Bench of this court has expressed the same view and has observed that the petitioner at his own sweet will and whims cannot be allowed to impugn the same cause of action in a writ petition filed before the Court and at the same time pursue the remedies available under the relevant law. The same view has been followed in the cases of Messrs Pak Saudi Fertilizers Ltd., v. Federation of Pakistan (2002 PTD 679), Bulk Shipping and Trading (Pvt.) Limited v. Collector of Customs (2004 PTD 509) and so also in the case of BP Pakistan Exploration and Production Inc. Karachi v. Additional Commissioner Inland Revenue (2011 PTD 647).

10.Therefore, we are of the opinion that in the facts and circumstances of the instant petition, the petitioner has failed to satisfy this Court that there was any valid or reasonable cause to abandon the proceedings before the adjudicating authority and to file the instant petition before this Court.We are of the view that the ratio of the above referred judgments of the Honorable Supreme Court and this Court is fully applicable to the case of the petitioner in hand.

11.The judgments referred to by the learned counsel for the petitioner are not applicable as the facts of the instant case are quite distinguishable from the facts referred to, in these judgments cited by the learned counsel for the petitioner, as in none of these cases the petition was entertained by the Courts once a party had submitted itself to the departmental jurisdiction by availing the alternate remedy available under the law. It is also important to mention that in the instant matter the petitioner has not challenged the jurisdiction of respondent No 4, in its reply to the show-cause notice as referred to above.

12.Adverting to the objection regarding assumption of jurisdiction by respondent No.4, in terms of S.R.O. 886(I)/2012 dated 18-7-2012 it would suffice to observe that, though, sections 32(1), (2) and 32-A, have been mentioned in the show-cause notice, but the narration of facts and legal issue raised in it is only in respect of the import status of the goods being restricted in view of Serial No 12 of Appendix "J" of IPO 2013.There is no allegation in respect of any mis-declaration of any sort, or even on the valuation of goods, except that an assessed/appraised value has been mentioned in it, which is due to the fact that value of used goods is required to be assessed after its physical examination, which has been done accordingly.It must be kept in mind that the instant show-cause notice is an electronic transmission and the very mentioning of the provisions of sections 32(1), (2) and 32-A of the Act would not ipso facto make it as such, until and unless there is a specific allegation in the body of show-cause notice to corroborate, such allegations. Therefore, in our view the subject show cause is only in respect of import status of the goods, alleging violation of section 16 of the Act, hence in view of para 3 of S.R.O. 886(I)/2012 dated 18-7-2012, the respondent No.4, is the appropriate adjudicating authority and has jurisdiction in the instant matter. The objection regarding assumption of jurisdiction by respondent No.4, is therefore, misconceived, and is hereby repelled.

13.We have also noticed and are of the view that even otherwise, the question raised on behalf of the petitioner in the instant petition could not be decided as it involves a factual controversy which perhaps this Court cannot look into, in its writ jurisdiction.To be very precise, the question that as to whether the goods in the instant petition are for "ground handling equipment" or not is yet to be determined by the Adjudication Collectorate and before such factual determination has been done, the question of interpreting the applicability of the restricted list of the IPO, 2013 cannot be decided.Therefore in view of this, even if we were to hold that the instant petition is maintainable, this question of fact would be an obstacle for us to decide the very question of interpretation raised on behalf of the petitioner, as until and unless it has been factually confirmed that the used conveyor belts imported by the petitioner is exclusively for "Ground Handling Equipment" as covered by serial No.12 of Appendix "J" of IPO, 2013, finally, the issue cannot be resolved.Hence the instant petition is dismissed in limine with all listed application(s).However, the petitioner would be at liberty to raise legal objections, including the applicability of IPO, 2013 and its restricted list before the respondent No.4, who shall decide the matter within 15 days from the date of this order after affording reasonable opportunity of hearing to the petitioner on all such issues as are raised by the petitioner, without being influenced by any of the observations made by this court hereinabove.

14.The instant petition stands dismissed as being not maintainable.

MH/B-1/SindhPetition dismisse