Syed AMJAD ALI SHAH VS SECRETARY, REVENUE DIVISION, ISLAMABAD, 2015 PTD-FEDERAL-TAX-OMBUDSMAN-PAKISTAN 1765 (2015)

Establishment of the Office of Federal Tax Ombudsman Ordinance (XXXV of 2000)---

----S. 10(1)---Procedure for redressal of grievances---Maintainability of complaint before Federal Tax Ombudsman---"Aggrieved person"---Scope---Import of vehicle---Complaint regarding maladministration by Customs Collectorate of Appraisement in the matter of clearance of imported vehicle was filed by clearing agent for the importer---Contention of the Department was that clearing agent was not an "aggrieved person" in terms of S. 10(1) of the Establishment of the Office of Federal Tax Ombudsman Ordinance, 2000---Held, that importer of the vehicle was the "aggrieved person" and the clearing agent could not be termed as "aggrieved person" in terms of S. 10(1) of the Establishment of the Office of Federal Tax Ombudsman Ordinance, 2001 and according to said section, a complaint shall be made in writing on solemn affirmation of oath by the person "aggrieved" or in case of such a person's death, by his legal representative---Complaint in the present case was filed by the clearing agent as "aggrieved person" and not as agent of the actual importer---Complainant, in the present case, had not been filed by any authorization from the importer----Section 10(1) of the Establishment of the Office of Federal Tax Ombudsman Ordinance, 2000, therefore, did not permit treatment of clearing agent as "aggrieved person"---Complaint was therefore not maintainable and was rejected, in circumstances.

Justice (R) M. Nadir Khan, Advisor Dealing Officer.

Syed Amjad Ali Shah and Muhammad Asif Authorized Representatives.

Asfandyar Khan, Deputy Collector Departmental Representatives.

FINDINGS

ABDUR RAUF CHAUDHRY, FEDERAL TAX OMBUDSMAN.---The complaint was filed under Section 10(1) of the FTO Ordinance, 2000 (the Ordinance) alleging protracted delay by Customs Authorities of Model Customs Collectorate of Appraisement (West) (the Deptt), Custom House, Karachi in clearance of a vehicle imported under personal baggage in terms of Appendix-E of the Import Policy Order, 2013 (the IPO-2013).

2.The complaint was referred for comments to the Secretary, Revenue Division in terms of Section 10(4) of the Ordinance. In response, the Deptt submitted para wise comments raising preliminary objections about maintainability of complaint on the ground that as the matter was sub judice before the competent adjudication authority, the complaint was hit by bar of jurisdiction under Section 9(2) of the Ordinance. Besides, the complaint was not filed by the owner of the vehicle i.e. the actual aggrieved person as required under Section 10(1) of the Ordinance and that the matter involved interpretation of 'Explanation' given in para-3 of Appendix-E of the IPO-2013 which fell under the jurisdiction of Ministry of Commerce.

3.On merits, the Deptt. did not dispute the facts and contended that perusal of examination report and documents i.e. passport of passenger, export certificate, bill of lading etc revealed that the ship on which the vehicle was loaded, departed from the load port on 7-1-2015. Therefore, the vehicle was not permissible for import/ clearance under baggage scheme as per Explanation given in para-3 of the IPO-2013 read with OM No.04(06)/2010-ImP-II(Part-X) dated 25-2-2013, further read with Office Order No.MCC/ADC-IV/01/PR/2015 dated 22-1-2015 and Alert Notice No.WI/Misc/01/ 2014/ADC-II dated 27-1-2015. The Deptt. pleaded that, since the vehicle was imported in contravention of the IPO-2013, there was no justification for its release.

4.The Deptt. further alleged that the importer, in association with his clearing agent, committed offence attracting provisions of Sections 16 and 32(1) of the Customs Act, 1969 (the Act) and Section 3(1) of Import and Export (Control) Act, 1950 punishable under clauses 9 and 14 of Section 156(1) of the Act and Section 33 of the Imports and Exports (Control) Act, 1950. Accordingly contravention report was forwarded to the adjudication authority for adjudication of the matter in terms of Section 179 of the Act. Show-cause notice (SCN) was issued and opportunity of hearing was provided to the importer and the clearing agent. The Deptt, however, denied that the complainant was advised to approach Ministry of Commerce. According to the Deptt, as per paras 19 and 20 of the IPO-2013 any aggrieved importer may approach the Ministry of Commerce for relaxation/condonation. The Deptt. pleaded that para-8 of the IPO-2013 clearly stated that, in case of dispute about import status, Ministry of Commerce was the final authority. For the matter under reference, the Ministry of Commerce had already clarified the position vide OM dated 25-2-2013. According to the Deptt, in absence of any release instructions from the Ministry of Commerce the impugned vehicle could not be released. Resisting the complaint, the Deptt. prayed for its dismissal.

5.The complainant on being supplied a copy of para wise comments filed rejoinder contending that the issues raised in the complaint were about inordinate delay on the part of the Deptt, application of law and jurisdiction of FTO with regard to Ministry of Commerce. The complainant reiterated his plea that the vehicle, being importable, was entitled to be released as 08 vehicles having same status had already been released.

6.Controverting legal objections raised by the Deptt. About maintainability of complaint, the complainant contended that no SCN was communicated to the complainant through electronic system or through any other source of communication before filing of complaint. Therefore, the matter was not hit by bar of jurisdiction under Section 9(2) of the Ordinance. According to the complainant, being Customs clearing agent, he acted on behalf of the importer as his agent. In support of his plea he relied on Sections 207 and 208 of the Act and 182 of the Contract Act, 1872. The complainant pleaded that FTO was not approached for interpretation of law but, rather, FTO intervention was sought as the Deptt. was not interpreting the law independently and as per the established principle of interpretation of statutes.

7.The complainant further contended that preamble to the Ordinance clearly stated that the office of FTO was created to "diagnose, investigate, redress and rectify any injustice, done to a person through maladministration by functionaries administrating tax laws". The Office of Federal Tax Ombudsman was under legal obligation as per preamble of the Ordinance to act and interpret the provisions of Ordinance in the light of principles and objectives in preamble for which it was created. Referring to Section 16 of the Act, the complainant contended that the restrictions under Section 3 of the Imports and Exports (Control) Act, 1950 are construed to be issued under Section 16 of the Act. The highest judicial forum in multiple decisions had held that all acts which prohibited or restricted import, export or transport of goods into or out of Pakistan shall also be deemed to be prohibited and restricted under Section 16 of the Act. Therefore, the IPO-2013 issued by Ministry of Commerce was deemed to be made and issued under Section 16 of the Act, 1969, and FTO's jurisdiction was not barred in matters involving Ministry of Commerce.

8.The parties were afforded opportunity of hearing on 14-5-2015. During hearing, the complainant submitted that the vehicle was importable under the relevant IPO. He accordingly filed GD for clearance of the vehicle. The GD was sent for examination; vehicle was examined and the assessing officer was provided relevant import documents. The complainant subsequently received system generated message dated 19-2-2015 that Additional Collector of Customs (Law) had approved the contravention and an SCN would be issued. A number of similar system-generated messages were received by the complainant from 20-2-2015 to 11-3-2015. On inquiry, it was intimated that the vehicle was not importable being more than 03 years old. The Deptt, however, advised the complainant to contact Ministry of Commerce as numerous importers facing similar situation had already approached the Ministry and got release. The complainant refused to approach the Ministry as he was of the opinion that, as per Explanation of para 3 of Appendix-E of the IPO-2013, the age of vehicle was to be determined from 1st January of the year subsequent to the year of manufacture till the date of shipment as per Bill of Lading. As the Bill of Lading confirmed that the shipper handed over the vehicle to the shipping company on 26-12-2014, the age of the vehicle was to be determined on the basis of date of shipment and not on the basis of date of sailing of vessel.

9.The complainant got hold of a copy of Office Memorandum (OM) dated 11-3-2015 issued by Ministry of Commerce, allowing release of 08 vehicles on one time basis. Perusal of tracking data of said 08 vehicles revealed that 07 vehicles were handed over to shipping company on 24-12-2014 and the ship sailed from the port on 2-1-2015, whereas the, 8th vehicle was handed over to the shipping company on 8-1-2015 and loaded on the ship on 13-1-2015. The complainant pleaded that said 08 vehicles were released by the Deptt whereas the vehicle subject of the complaint, being on similar footing, was denied similar treatment.

10.The complainant further submitted that on 11-3-2015, a message was received to appear at office on 2nd Floor Custom House, Karachi. His representative visited the office and met Mr. Abdul Hayee Sheikh who informed that no contravention was available in his folder and directed him to approach Mr. Imran Gull, Appraising Officer. The said officer informed that GD was forwarded to concerned officer for issuance of SCN and same was not available in the folder. The complainant contended that till filing of the complaint no SCN was received and the vehicle was not released. Seeking FTO's intervention, the complainant prayed as under:--

"-to direct the customs authorities for immediate processing of Goods Declaration and release of aforementioned vehicle in the light of Explanation as available in Appendix-E IPO 2013;

-that acts of Ministry of Commerce, which regulates the Import and Export of goods falls within the jurisdiction of this Hon'ble Forum for review and appropriate order;

-if complaint accepted then direct the Customs authorities to pay the accumulated demurrage/detention and terminal charges;

-the principle decided in this complaint may also be made applicable in all other GDs wherein facts are similar;

-direct Secretary of Commerce to bring transparency in matters related to Import and Export."

11.The DR, relying on the averments of para wise comments added that the complainant was served with SCN on 11-3-2015 and hearing was fixed on 13-5-2015 which the complainant did not attend. He filed copies of printout about issuance of SCN and hearing notice.

12.The AR submitted that he had explained in his rejoinder/written arguments that no SCN was served on him and the system showed that no SCN was pending till 13-5-2015.

13.Submission of the parties considered and documents available on record perused. Before going into merits of the case, the legal objections raised by the Deptt. need to be addressed.

14.The importer of vehicle was Samiullah R/o Mardan. He being the importer of the impugned vehicle was the aggrieved person. The clearing agent cannot be termed as aggrieved person in terms of Section 10(1) of the Ordinance, according to which a complaint shall be made in writing on solemn affirmation or oath and shall be addressed to the Federal Tax Ombudsman by the person aggrieved or, in the case of his death, by his legal representative. Complaint was filed by the clearing agent as an aggrieved person but not as agent of Samiullah. Besides, the complainant did not file any authorization from Samiullah to file the complaint. As he was authorized only to represent Samiullah before the Customs Deptt, the complaint filed in his own name did not meet the requirement of Section 10(1) of the Ordinance. The objection so raised by the Deptt being supported by Section 10(1) of the Ordinance does not permit treatment of the clearing agent in this case as aggrieved person. The complaint, therefore, filed in the present form is not maintainable.

15.The complainant disputed that the matter was sub judice before the adjudicating authority when the complaint was filed as no SCN was served on him or the importer before filing of the complaint. The Deptt, though, has filed system generated messages about hearing as well as system generated copy of SCN but it does not reflect the date of issuance of SCN. In such view of the matter, the objection of the Deptt about the matter being sub judice when the complaint was flied could not be established. The objection is overruled.

16.Adverting to the objection about matter requiring interpretation of law it would suffice to observe that it was an admitted fact that 8 vehicles, having same status, were refused release by the Deptt. whereupon, the importers approached Ministry of Commerce seeking permission for release of used / second hand vehicles. The Ministry vide OM dated 11-3-2015 decided to allow import of the vehicles on one time basis, thereby, meaning that vehicles did not qualify for import as the same, though, were handed over to the shipping company before 31st December but the ship sailed after 1st January. Besides, the Ministry of Commerce vide OM dated 25-2-2013 issued clarification that the date of EGM and Cargo Vessels leaving the port of export may be considered with reference to cut-off date for the purpose of S.R.O. 1441(I)/2012 dated 12-12-2012 issued by the Ministry of Commerce.

17.In such view of the facts, FTO need not interpret `Explanation' of para 3 of Appendix-E of IPO. Besides, Section 9(2)(b) of the Ordinance bars FTO's jurisdiction from interpretation of law, rules and regulations. It would be relevant to observe that, the vehicles having status similar to the status of the vehicle subject of complaint, were allowed release by the Ministry vide OM dated 11-3-2015 which was restricted to 8 vehicles mentioned in OM and the said OM could not be applied to some vehicle other than mentioned in the said OM. The complainant was required to get permission of Ministry of Commerce for release which he did not opt. Therefore, the Deptt in the light of Explanation given vide para-3 of IPO, OM dated 25-2-2013, Office Order dated 22-1-2015 and Alert Notice dated 27-1-2015 for implementing the Explanation of para-3 of Appendix-E of IPO, could not release the vehicle which left the port of shipment after 31st December. Refusal of the Deptt., therefore, cannot be termed illegal, violation of law, rules, regulation or practice to attract provisions of Section 2(3) of the Ordinance.

18.The complainant was mainly aggrieved by the OM dated 25-2-2013 issued for clarification of Explanation to para. 3 of Appendix-E of IPO issued by Ministry of Commerce whereas, under section 9(1) of the Ordinance, the FTO may on a complaint by any aggrieved person, or on a reference by the President, the Senate or the National Assembly, as the case may be, or on a motion of the Supreme Court or a High Court made during the course of any proceedings before it or of his own motion, investigate any allegation of maladministration on the part of the Revenue Division or any tax employee, whereafter no scope was left for argument to extend FTO's jurisdiction to Ministry of Commerce or any other department or authority except Revenue Division or any federal tax employee. Therefore, the acts of Ministry of Commerce falling outside FTO's jurisdiction cannot be taken cognizance of by FTO.

19.In such view of the facts and law, the complaint is liable to be rejected as it has not been filed by the aggrieved person and no case of maladministration was made out against the Deptt implementing the law and instructions issued by Ministry of Commerce which falls outside FTO's jurisdiction

20.The complaint is rejected and case file consigned to record.

KMZ/84/FTOComplaint rejected.