A.F.U. INTERNATIONAL, KARACHI VS DIRECTOR GENERAL, 2016 PTD-CUSTOMS-APPELLATE-TRIBUNAL-LAHORE 1305 (2015)

2016 P T D (Trib.) 1305

[Customs Appellate Tribunal]

Before Muhammad Nadeem Qureshi Member (Judicial-I) and Muhammad Yahya Member (Technical-I)

Messrs A.F.U. INTERNATIONAL, KARACHI

Versus

DIRECTOR GENERAL and another

Customs Appeal No.K-445 of 2014, decided on 16/12/2015.

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

----S. 25-A---Income Tax Ordinance (XLV of 2001), S.148(9)---Sales Tax Act (VII of 1990), S.46(g)---Import of goods---Customs value, determination of---Directorate General of Valuation, powers of---In terms of S.46(g) of Sales Tax Act, 1990, Director, Directorate of General Valuation was not empowered to fix the value of imported goods through valuation ruling in exercise of power vested under S.25A(1) of Customs Act, 1969 as it was for the Federal Board of Revenue to issue a notification---Similarly, for determination of value of goods for levy/collection of Income Tax at import stage, the Director, Directorate General of Valuation was not empowered as evident form the expression of S.148(9) of Income Tax Ordinance, 2001, rendering the determination of value for levy of Sales Tax and Income Tax under S.25A(1) of Customs Act, 1969 without power/jurisdiction---Determination of value for levy/collection of Sales Tax and Income Tax at import stage by Director, Directorate General of Valuation was coram non judice, null and void and of no legal effect---Mandatory condition for exercise of jurisdiction if the same was not fulfilled, then entire proceeding which followed became illegal and suffered from want of jurisdiction.

Mansab Ali's case PLD 1971 SC 124; Chittaranjan Cotton Mills Ltd. v. Staff Union PLD 1971 SC 197; Kwami Asante, Treahon v. Chief Kwame Tawia PLD 1973 SC 236 and Shahid Impex v. Director General of Valuation 2014 PTD (Trib.) 675 rel.

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

----Ss. 25, 25(10) & 25(15)---Value of imported and exported goods, determination of---Scope---Provisions of S.25 of Customs Act, 1969 were to be followed in sequential manner baring certain exceptional cases where massive group under-invoices was rampant, however, resort to subsequent method was not permissible without exhausting the sequence indicated in S.25 of Customs Act, 1969 as it would annihilate and terminate the spirit and essence of transaction value which in the first instance had to be established as colourable and tainted---Mere insertion of word "may" or "may not" in place of "are required to" in S.25(15) of Customs Act, 1969 through Finance Ordinance, 2007 did not give a free hand to Customs Administration to manoeuvre the provisions of S.25 of Customs Act, 1969 and thereby making them in-effective and redundant---Discretion had to be exercised judicially based on reason, rationale and fairplay and it was specifically provided by Legislature in S.25(10) of Customs Act, 1969 that subsections (1), (5), (6), (7), (8) & (9) of said section define how the customs value of imported goods were to be determined by the customs---Methods of customs valuation were normally required to be applied in a sequential order except reversal of the order at importer's request, if so agreed by Collector of Customs.

Rehan Omer v. Collector of Customs Karachi 2006 PTD 909; Messrs Toyo International Motorcycle v. Federation of Pakistan and 3 others 2008 PTD 1494; Najam Impex Lhr v Assistant Collector of Customs, Karachi and others 2008 PTD 1250; Sadia Traders v. FOP PTCL 2014 CL537; Faco Trading Company v. Members Custom, Federal board of Revenue and others 2013 PTD 825; Goodwill Traders, Karachi v. FOP 2014 PTD 176 rel.

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

----Ss. 25, 25(7) & 25(9)---Customs Rules, 2001, Rr.107, 108 & 112---Valuation Procedures---Value of imported and exported goods, valuation of---Scope---Method of valuation provided in S.25 of Customs Act, 1969 and Customs Rules, 2001 were required to be applied in a sequential order and without visible exercise reflected on record, no resort could be made to secondary method of valuation---In the present case, Director, Directorate General of Valuation had directly determined the value of compound chocolate under Ss.25(7) & 25(9) of Customs Act, 1969 which was unlawful on the face of it as value could either be determined under S.25(7) or 25(9) of Customs Act, 1969, and not under both the subsections and that also after exhausting the exercise conducted under the preceding subsection of S.25 of Customs Act, 1969---Such an inquiry was not in accordance with law, and was without jurisdiction, being patently in derogation of provisions of Ss.25 & 25A of Customs Act, 1969 and Chapter IX of Customs Rules, 2001.

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

----Ss. 25D & 81---Import of goods---Valuation of goods---Provisional determination---Review of value---Scope---When an initial order for valuation was challenged through an appeal or review application, the said order so assailed, reopened for decision by Reviewing/Appellate Authority, therefore upon challenging the Valuation Ruling through Review Application under the provisions of S.25D of Customs Act, 1969, it stood re-opened with the norms of justice and fair play---Department was mandated to immediately pass stay order on filed Review Application or at least issue direction to the Clearance Collectorate to complete assessment of forthcoming consignment of import under S.81 of Customs Act, 1969 as determined value through Ruling stood sub-judice before him and thus un-operational to the extent of imported goods.

CBR v. Chanda Motors 1993 SCMR 39; Ghulam Nabi v. FOP 2013 PTD 581; Central Board of Revenue and others v. Chanda Motors 1993 SCMR 39; Garikapati Veeraya v. N. Subbiah Choudhry and others PLD 1957; Commissioner of Wealth Tax v. Vimlaban Vadilal Mehta (1984) 145 ITR 11 and F.A. Khan v. The Government of Pakistan PLD 1964 SC 520 and Chatturam and others v. Commissioner of Incmoe Tax Bihar (1947) 15 ITR 302 rel.

Nadeem Ahmed Mirza, Consultant along with Obayd Mirza for Appellants.

Riaz Hyder, P.A. for Respondent No.1.

Abdul Rasheed Khan, Appraiser for Respondent No.2.

Date of hearing: 9th February, 2015.

JUDGMENT

MUHAMMAD NADEEM QURESHI, (MEMBER JUDICIAL-I).---By this order, we dispose off Customs Appeal No. K-445/2014 filed by the appellant against Order-in- Review No. 40/2014 dated 16.04.2014 passed by Director General, Directorate General of Valuation (here-in-after to be referred as respondent No. 1), rejecting the review application and maintained Valuation Ruling No. 625/2013 dated 23.12.2013 through which value was determined for compound Chocolate of Turkey origin.

2.The Director, Directorate General of Valuation issued Valuation Ruling No. 625/2013 dated 23.12.2013 under Section 25A(1) of the Customs Act, 1969, fixing value at Serial No. 3 of compound Chocolate of Turkey origin at US$ 2.15/kg C&F under Subsection (7) & (9) of Section 25 ibid. as against actual US$.1.00/kg. Being aggrieved with the determination of Compound Chocolate of Turkey origin through Valuation Ruling No. 625/2013 dated 23.12.2013. The appellant being aggrieved with the determination of value of Compound Chocolate filed Review Application No. DG(V)/Val.Rev/28/2014 dated 21.01.2014 under Section 25D of the Customs Act, 1969 before the respondent, through which the determination of value of Compound Chocolate of Turkey Origin was disputed and the respondent no.1 was prayed to declare the said Ruling to the extent of Compound Chocolate contrary to the provision of Section 25 of the Customs Act, 1969, Section 46(d) and (g) of the Sales Tax Act, 1990 and Section 148(6)&(9) of the Income Tax Ordinance, 2001. The respondent disagreed with the contention of the appellant and passed Order-in-Review dated 16.04.2014, through which review application was rejected on the basis of formed opinion in Para 4 and 5 are relevant which are reproduced as under:--

"4. The record of the case has been examined and the arguments put forward by the petitioner have been considered. In the contents of afore cited memo of petition, impugned ruling has been challenged with particular reference to the valuation of compound chocolate from Turkey determined @ $. 2.15/kg on the following main points namely:-

a)That the customs value determined in the impugned ruling is nullity to the actual cost of the imported goods contracted with the seller for bulk import and supported their statement with the documents namely, copy of GD, invoice, B/L, Packing.

b)That the decision was held without following sequential method of valuation as provided under the rules.

c)That the goods are sold in bulk packing in the market and when converted as per the calculation drawn in the memo, the transaction value represents the correct price within the meaning of section 25(1) of the Customs Act, 1969.

5. The Department's rebuttal is based upon the findings of enquiry conducted under section 25(7) of the Customs Act, 1969. Otherwise, for the in applicability of preliminary methods of valuation, it has been asserted that due non-availability of sufficient information and absence of competitive import evidences under section 25(5) & (6) of the Customs act, 1969, these methods were held in valid for application in this case. resultantly, reliance was made upon the deductive method and as per findings of enquiry under section 25(7) of the Customs Act, 1969, customs value was fairly determined in accordance with law. It has been observed that these findings were based upon substantive enquiry and admissible margin of deduction margin of deduction were duly considered in the working drawn by the department. In this regard, the calculation given by the petitioner reflects abnormal retail price margin, which is apparently the main cause of difference between the calculation drawn by the department and the petitioner. Otherwise there seems to be a lenient and fair conclusion drawn by the Department after having a detailed analysis. In the impugned valuation ruling, convincing reasoning has been given to justify issuance of the same, which was based upon scrutiny of data and findings in terms of section 25(7) of the customs Act, 1969, as referred above. The working drawn under the aforesaid provision of law seems to have been aptly equated in the reply objection/comments given by the respondents. The petitioner has since not been able to demonstrate that the incidence of actual duty and taxes was not passed on to the consumer, it renders rejection of revision petition also in terms of section 19A of the Customs Act, 1969.

3.Being aggrieved and dis-satisfied with the impugned Order-in-Revision, the appellant Messrs A.F.U International, Karachi filed the instant appeal before this Tribunal against the respondent No. 2 on the grounds in corporate in the Memo of Appeal.

4.On the date of hearing Mr. Nadeem Ahmed Mirza, Consultant along with Mr. Obayd Mirza, Advocate, appeared on behalf of the appellant, reiterated the contents of grounds of Appeal and further contended that, the Director, Directorate General of Valuation is not designated as "Officer of Inland Revenue" under any provision of Sales Tax Act, 1990 or Income Tax Ordinance, 2001, resultant is not empowered to determine the value for levy of Sales Tax and Income Tax at import stage under the provision of Section 25A(1) of the Customs Act, 1969. The competent authority to determine the value for the levy of Sales Tax and Income Tax is "Officer of Inland Revenue" under clause (d) of Section 2(46) of the Sales Tax Act, 1990 which specifically state that for levy of sales tax the value has to be determined under section 25 of the Customs Act, 1969 and in case the notification is desired to be issued, it is for the Board in terms of clause (g) ibid. Likewise, under Section 148 of the Income Tax Ordinance 2001 value for levy of income tax has to be determined under section 25 of the Customs Act, 1969 and by the authorities enunciated in Subsection (9) ibid. The Director, Directorate General of Valuation usurped the power of the Board and appropriate officer defined in clause (g) of Section 2(46) of the Sales Tax Act, 1990 and subsection (9) of Section 148 of the Income Tax Ordinance, 2001. By laying hand on the power of authority given in section 2(46) and 148 of the Act/Ordinance, she acted without power/jurisdiction, rendering the Valuation Ruling 520/2012 dated 28.12.2012 for fixation of value for levy of Sales Tax and Income Tax at import stage, therefore is null, void and ab-initio, hence coram non judice as held in reported judgments Major Syed Walayat Shah v. Muzaffar Khan and 2 others (PLD 1971 SC 184), Omer & Company v. Controller of Customs, (Valuation): (1992 ALD 449 (1) Karachi AAA Steel Mills Ltd v.s Collector of Sales Tax and Central Excise Collectorate of Sales Tax (2004 PTD 624), PLD 2004 Supreme Court 600 All Pakistan Newspaper Society and others v FOP, PLD 2005 Supreme Court 842 Khyber Tractor (Pvt.) Ltd., v. FOP, PLD 1976 Supreme Court 514 Ali Muhammad v. Hussain Buksh and others and PLD 2001 Supreme Court 514 Land Acquisition Collector, Noshehra and others v. Sarfraz Khan and others, 2005 PTD 2237 Pak Suzuki Motors Company Ltd., Karachi v. Collector of Customs, Karachi, 2009 PTD (Trib.) 1996, 2010 PTD(Trib) 832 and Order of Tribunal in Custom Appeal No. 695/2013. He further contended that, when the appellant in the column of (financial information) of the GD transmitted clearly that the import of his goods is against firm contract, its number and date, he discharged the burden laid upon him under Section 25(1) of the Customs Act, 1969 and Rule 109 of the Customs Rules, 2001. For disputing the said value it was mandated upon the respondent No. 1 to supply reasoning for non-acceptance of the value as per expression of Sub-Rule (3) of Rule 109 of Chapter IX of Custom Rules, 2001 and then only to determine the value. Non compliance of the mandated requirement render the valuation ruling nullity to the provision of Section 25 and Rule 109 ibid hence of no legal effect and cannot be applied on the goods to be imported. He also contended that, the provision of Section 25 of the Customs Act, 1969 are to be followed in sequential manner baring certain exceptional cases where massive group under invoices is rampant. However, resort to subsequent method is not permissible without exhausting the sequence indicated in Section 25 as it would annihilate and terminate the spirit and essence of the transaction value which in the first instance has to be established as colorable and tainted. Section 25(13)(a) does not give unbridled and un fettered authority to customs administrations to play havoc with the provision of Section 25 ibid., thereby making them in-effective and redundant. Discretion has to be exercised within limits based on reason, rationale and fair play. It is specifically provided by the legislature in Subsection (10) of Section 25 that Subsections (1) (5), (6), (7), (8), (9) define how the customs value of the imported goods is to be determined by the customs. The method of custom valuation are normally required to be applied in a sequential order except reversal of the order of subsection (7) and (8) at the importers request, if so agreed by the Collector of Customs as held in judgments 2008 PTD 1494 Messrs Toyo International Motorcycle v Federation of Pakistan and 3 others, Order in C.P. No. 2673 of 2009 reported at PTCL 2014 CL 537 of M/s. Sadia Traders v. FOP, 2013 PTD 825 Messrs Faco Trading and 45 others v. Member Customs, FBR & 2014 PTD 176 Goodwill Trader , Karachi v. FOP and others The Director, Directorate General of Valuation has stated in the ruling that identical/similar transaction value available in data maintained under Rule 110 of the period expressed in Rule 107 of the Customs Rule 2001 is not applicable because of non availability of sufficient information , this is completely absurd and provide no reason or power to her to ignore the method prescribed in subsections (5) and (6) of the Customs Act, 1969 and Rules 117 and 118 of Chapter IX of Customs Rules, 2001 which are applicable with full vigor. Only the said fact is sufficient to declare the Valuation ruling nullity to the Section 25 of the Customs Act, 1969 and the law laid down by the Superior Judicial For a in the judgment referred in ground (iv) to the extent of appellant goods. The Director, Directorate General of Valuation has directly determined the value in terms of subsection (7) of Section 25 of the Customs Act, 1969, which state that if the customs value of the imported goods could not be determined under Subsection (6) of S.25 of the Customs Act, 1969 , same shall be determined under subsection (7) and defined formula in Rule 119 on the basis of Customs Value of the imported goods of identical or similar goods relying upon the unit price at which such imported goods were sold in greatest aggregate quantity at or about the time of importation to a person, who is not related to the person from whom an importer buy such goods, subject to certain specified deduction. Deductive method is primarily a work back method based on the Analytic basis of valuation prevalent under defunct/rest while concept of Normal Price or Notional Value under Brussels Definition of Value (BDV) market inquiry has to be conducted by the subordinate of respondent on the parameter that the goods employed for determination of customs value should comprise the impugned imported goods or identical/similar goods which were sold in Pakistan in the same state and the inquiry should had been based on unit price at which the impugned imported goods or identical or similar imported goods were sold in the greatest aggregate quantity and that the words "at" or "about" the time of importation of goods being valued denotes 90 days valuation data maintained under Rule 110 in terms of S.25(1) of the Customs Act, 1969 for the period expressed in Rule 107(a) of the Customs Rules, 2002. Amongst other the above two ingredients in respect of the imported goods to be so valued one relating to the quantity and other relating to the period during which the impugned goods or identical or similar goods were sold in the greatest "aggregate quantity". The valuation ruling and the order-in review illustrate the irresponsible indifferent careless attitude of the official of the DGV, including director and respondent no. 1 who are supposed to be expert in their field. Rendering the valuation ruling in derogation with the provision of the relevant subsection (7) of S.25 of the Customs Act, 1969 and Rule 119 of Customs Rules, 2001, as such null, void and ab-initio. Notwithstanding, to the illegalities, committed by the subordinate of respondent while determining the value through valuation ruling and respondent himself, who rejected the review application without taking into consideration the provision of Section 25 of the Act and rule embodied in Chapter IX of the Customs Rules, 2001, the appellant felt appropriate to add further for the sake of arguments without conceding that the determination made in the ruling under section (7) is not correct and least portray the fair value of appellant goods, therefore appellant states that it is nullity to the fact and the expression of section (7) and formula defined in Rule 119 and this stood validated from the working of valuation for determination of appellant to be imported compound chocolate, as under:

Sold in bulk packing by the retailer in the market: Rs. 500/kg.

Less:

Retailer Margin 35%Rs. 175.00

Whole seller Margin 10%Rs. 32.00

Distributor Margin 10%Rs. 29.00

Applicant Margin 10%Rs. 26.00

Income Tax 5.5%Rs. 13.00

Sales Tax 20%Rs. 44.00

Custom Duty 30%Rs. 53.00

Shipping & Port Expenses 10%Rs. 12.00

Miscellaneous Expenses 5%Rs. 6.00

Rs. 395/kg

Rs. 105/kg

=====

Converted into US$ @ of Rs. 105/-US$. 1/kg

That the above calculation is without bulk packing, which the appellant has to bear prior to selling the goods, rendering the contracted price as transaction value within the meaning of Section 25(1) of the Customs Act, 1969.

5.Learned consultant further contended that, the respondent in the order-in-review has not uttered a single word on the veracity of the appellant import value, instead stated that, the retail price margin is abnormal as against adopted by his subordinate. No cogent or plausible reason were given for the formed opinion, neither reasoning for the percentage adopted for retail profit has been substantiated in the order nor the detail of expenses shown by the appellant has been negated, rendering the valuation ruling dated 23.12.2013 based on fishing inquiry and his opinion based on presumption, surmises and conjectures, which is not permissible under law and as such of no legal effect as held in reported judgment 1957) 32 ITR 89 (1967) 64 ITR 516, I.T.As. 2400/2401/KB/91-92,(1995) PTD (Trib.) 580, (1995) PTD (Trib.) 1152, (1982) 1381 ITR 742, 1993 PTD 206,1997 PTD (Trib.) 2209 and 2013 PTD (Trib.) 353. The respondent No. 1 in the last para of the order has relied upon section 19A of the Customs Act, 1969, which has no nexus with the case of appellant nor with the provision of Sections 25, 25A and 25D of the Customs Act, 1969 as evident from its expression which read as "every person who has paid custom duty and other levies on any goods under this Act shall unless the contrary is proved by him, be deem to have passed on the full incidence of such customs duties and other levies to the buyer as a part of the price of such goods." Therefore, when the appellant obtained the clearance of the goods on the basis of assessment made by the subordinates of respondent No. 2 with the application of valuation ruling, he paid the duty and levies on the assessed value, obviously upon sale the same shall be passed by him to the buyer as against his declared value despite rendering the product expensive and out of reach of the end consumer. No question of claiming any refund exist in the said circumstances. Therefore, reliance on section 19A by the respondent No. 1 for rejecting the review application proves his inability in nullifying the import price of the appellant goods, which is transaction value within the meaning of section 25(1) ibid. hence, the order is based on erroneous consideration, hence null, void and ab-initio. When the appellant challenged the virus of valuation ruling before the respondent no. 1, the valuation ruling stood abate and is not applicable on the appellant forthcoming consignment by virtue of the fact that the impugned valuation ruling is not final to the extent of appellant, unless it crosses all the forums set up under the law in which it can be challenged and the order of the last forum would become final, as held by the Hon'ble Superior Court of Pakistan in reported Judgment 1993 SCMR 39 CBR v. Chanda Motors and 2013 PTD 581 Ghulam Nabi v FOP. It is right of the appellant to obtain the clearance of his goods on the basis of provisional assessment under the provision of Section 81 of the Customs Act, 1969 till the time the virus of ruling is not decided by the last judicial fora given in the Act i.e. Sections 25D, 194A and 196 of the Customs Act, 1969 as the same is not applicable on the appellant goods and he has every right to avail the said facility and the authority defined in Section 81 of the Customs Act, 1969 i.e. respondent no. 2 are legally bound to accede to the request without any exception and the stance of appellant stood validated from the reported judgments 2014 PTD 525 Waseem Radio Trader v FOP and PTCL 2014 CL 103 Alpha Chemical (Pvt.) Ltd. v. FOP and 4 others. He prayed that the Valuation Ruling No.625/2013 and Order-in-Review may be declared null and void.

6.No cross objection were submitted within the stipulated period given in subsection (4) of Section 194A of the Customs Act, 1969. The representatives of the department/respondent argued that, the case in accordance with the grounds incorporated in para supra. During the course of hearing query was made in regards to determination of value for Sales Tax by the Board that as to whether Board has ever issued notification to the said effect, to the consultant/advocate of the appellant. He stated that although it is the job of the respondent but he will place the copies of notification on record for perusal of the Hon'ble Member of the Bench. The consultant/advocate further argued in line with the argument adopted in the Memo of Appeal and place on record of the Tribunal copies of the relied upon judgment. Although, it was ordered by the Tribunal to proceed ex parte, the representative of the respondent appeared, the appellant consultant/advocate raise no objection, resultant, the Tribunal allowed the representative to rebut the arguments. The representative of respondent no. 1 stated that the value of the compound chocolate was determined after proper market inquiry and the value so determined thereafter through Valuation Ruling is correct in law and therefore be maintained. Whereas the subordinate of respondent No. 2 stated that the importer and importers are getting their goods cleared on the determined value by the Director, Directorate General Valuation. A question was put to him that how many consignment has been cleared since the issuance of Valuation Ruling in reply he said only 4, another question was put to him that as to whether those importer were having any other option to get their goods cleared either on declared value or on the basis of import prices available in the data maintained by the Collectorate in terms of Rule 110 of Chapter IX of Customs Rules, 2001, in the presence of the impugned valuation ruling dated 23.12.2013, the answer was in negative. Another query was made with the representative of the respondent that as to whether in case of dispute of value or upon filing of review against the Valuation Ruling, either the respondent No. 1 direct the respondent no. 2 to complete the assessment under section 81 of the Customs Act, 1969, till the decision in the review application or the subordinate of respondent No. 2 allowed the clearance under the provision of Section 81 subject of determination of value by the official of respondent No. 1, the answer was negative. Hence, the Tribunal ask why the provision of Section 81 is not exercise despite availability, the answer was shocking that Collector of Clearance Collectorate has either issued verbal or written order not to allow clearance of the consignment under section 81 of the Customs Act, 1969, unless allowed by either Additional Collector or the Collector.

7. Rival parties heard and case records perused. Firstly it is of vital importance to take up the issue raised in regards to powers/jurisdiction of the Director, Directorate General of Valuation for determining of value for levy of Sales Tax and Income Tax through Valuation Rulings as the Advocate/Consultants has strongly contended that determination of value for levy of Sales Tax and Income Tax does not falls within the powers/jurisdiction of the Director, Directorate General of Valuation. For reaching at just conclusion it is beneficial to reproduce the respective Section 2(46) of the Sales Tax Act, 1990 and 148 of the Income Tax Ordinance, 2001.

Section 2(46) : "Value of supply" means ; -

(a)-----------------

(b)-----------------

(c)----------------

(d)In case of imported goods the value determined under Section 25 of the Customs Act, 1969 including the amount of Custom duties and Central excise duties levied here-on.

(e)---------------

(f)---------------

(g)In case of taxable supplies, with reference to retail tax, the price of taxable goods excluding the amount of retail tax, which a supplier will charge at the time of making taxable supply by him or such other price as the Board may by a notification in the official of Gazette, specify.

Provided that where the Board deems it necessary it may by notification in the official Gazzette fix the value of any imported goods or taxable supplies or class of supplies and for that purpose fix different values for different classes or description of same type of imported goods or supplies.

148 Imports :-

(1)The Collector of customs shall collect advance tax from every importer of goods on the value of the goods at the rate specified in Part II of the First Schedule.

(2)---------------

(3)---------------

(4)---------------

(5)Advance tax shall be collected in the same manner and at the same time as the customs duty payable in respect of the import or, if the goods are exempt from customs duty, at the time customs duty would be payable if the goods were dutiable.

(6)The provisions of the Customs act, 1969 (IV of 1969), in so far as relevant, shall apply to the collection of tax under this section.

(7)-------------------

(8)------------------

(9)In this Section:-

"Collector of customs" means the person appointed as Collector of Customs under section 3 of the Customs Act, 1969 (IV of 1969) , includes a Deputy Collector of customs , an Additional Collector of customs, or an officer of customs appointed as such under the aforesaid section;

"value of goods" means the value of the goods as determined under section 25 of the Customs Act, 1969 (IV of 1969), as if the goods were subject to add valorem duty increased by the customs duty Federal Excise duty and sales tax if any payable in respect of the import of the goods and;"

8.Upon scrupulous study of Section 6 and 148 of the Sales Tax Act, 1990 and Income Tax Ordinance, 2001, it has been observed that the value of the imported goods has to be determined by the Custom under Section 25 of the Customs Act, 1969 as expressed in Section 46(d) of the Sales Tax Act, 1990 and Subsection (6) of Section 148 of the Income Tax Ordinance, 2001 by the Authorities given in subsection (9) ibid., which are Collector of Customs, Additional Collector of Customs, Deputy Collector of Customs, Assistant Collector of Customs, or an Officer of Customs appointed under section 3 ibid. Notwithstanding, in case the Board is desirous of determining the value of the imported goods, for levy of Sales Tax, it issues notifications in terms of 1st proviso of subsection (g) of Section 46 of the Sales Tax Act, 1990 as has been done n the followings:

(i)S.R.O. 494(I)/2004 dated 12.06.2004 for phosphoric acid.

(ii)S.R.O. 103(I)/2005 dated 03.02.2005 Potassium Fertilizer.

(iii)S.R.O. 563(I)/2006 dated 05.06.2006 Crystalline Sugar and

(iv)732(I)/2006 dated 13.07.2006 for certain goods.

9.That in terms of above proviso, the Director, Directorate General Valuation is not empowered to fix the value of imported goods through valuation ruling in exercise of power vested under section 25A(1) of the Customs Act, 1969. It is for the Board to issue a notification; similarly, determination of value for levy/collection of Income Tax at import stage, the Director, Directorate General of Valuation is not empowered as evident from the expression of Sub-Section 9 of Section 148 of the Income Tax Ordinance. 2001, rendering the determination of value for levy of Sales Tax and Income Tax under the provision of Section 25A(1) of the Customs Act, 1969 without power/jurisdiction, resultant, the plea of the respondent stood negated as the same is being in derogation of 1st proviso of Subsection (g) of Section 46 of the Sales Tax Act, 1990 and subsection (9) of Section 148 of the Income Tax Ordinance, 2001.

10.It is basic principle that if a mandatory condition for exercise of jurisdiction is not fulfilled then the entire proceeding which follows become illegal and suffer from want of jurisdiction as laid down by the Hon'ble Apex Court in Mansab Ali's (PLD 1971 SC 124) and in the case of Chittaranjan Cotton Mills Ltd., v. Staff Union reported at PLD 1971 S.C., 197, it was held that "Whereas the court is not properly constituted at all the proceeding must be held to be coram non judice and, therefore, non-existent in the eyes of law. There can also be no doubt that in such circumstances "it could never be too late to admit and give effect to the plea that order was a nullity", as was observed by the Privy Council in the case of Chief Kwame Asante, Treahon vs. Chief Kwame Tawia "and in the case of Raunaq Ali's [PLD 1973 S.C. 236], it was held that "It is now well established that where an inferior tribunal or Court has acted wholly without jurisdiction or taken any action "beyond the sphere allotted to the tribunal by law and, therefore, outside the area within which the law recognizes a privilege or err", then such action amounts to a "usurpation of power unwarranted by law" and such an act is a nullity; i.e. to say, "the result of a prescribed exercise of authority which has no legal effect whatsoever". In such a case, it is well established that a superior court is not bound to give effect to it, particularly where the appeal is to the later's discretionary jurisdiction. The courts would refuse to perpetuate, in such circumstances, something which would be patently unjust or unlawful". No deviation from the notified jurisdiction could be made, if an action has been taken or order has been passed without having competency under the respective provision of Act/Ordinance, same is to be declared illegal and without jurisdiction and this has been already held in many reported/unreported judgment by this Tribunal, latestly in reported judgment 2014 PTD (Trib.) 674 M/s. Shahid Impex v. Director General of Valuation. Hence, In the light of dictum laid down by the Superior Judicial Fora in above referred judgments and countless more, we hold that the determination of value for levy/collection of Sales Tax and Income Tax at import stage by the Director, Directorate General of Valuation through Valuation Ruling No. 625/2013 dated 23.12.2013 is coram non judice, hence ab-initio, null and void and of no legal effect.

11.The provision of Section 25 of the Customs Act, 1969 are to be followed in sequential manner baring certain exceptional cases where massive group under invoices is rampant. However, resort to subsequent method is not permissible without exhausting the sequence indicated in section 25 as it would annihilate and terminate the spirit and essence of the transaction value which in the first instance has to be established as colorable and tainted. The mere insertion of word "may" or "may not" in place of "are required to" in subsection (15) of Section 25 of the Customs Act, 1969 through Finance Ordinance 2007 does not give a free heard to customs administrations to moreover the provision of Section 25 ibid, and thereby making them in-effective and redundant. Discretion has to be exercised judicially based on reason, rationale and fairplay. It is specifically provided by the legislature in subsection (10) of Section 25 that subsections (1) (5) (6) (7) (8) (9) define how the customs value of the imported goods is to be determined by the customs. The methods of custom valuation are normally required to be applied in a sequential order except reversal of the order of subsection (7) (8) at the importer's, request, if so agreed by the Collector of Customs. This aspect has been examined countless times by the Superior Judicial Fora and held that the Provision of Section 25 of the Customs Act 1969 has to be followed in sequential manner without any exception, reference is placed to reported/unreported judgments listed below:--

(i)2006 PTD 909 Rehan Omer v. Collector of Customs Karachi,

(ii) 2008 PTD 1494 Messrs Toyo International Motorcycle v. Federation of Pakistan and 3 others,

(iii) 2008 PTD 1250 Najam impex Lhr v Assistant Collector of Customs, Karachi and others,

(iv)PTCL 2014 CL537 Sadia Traders v. FOP

(v) 2013 PTD 825 Faco Trading Company v. Members Custom, Federal board of Revenue and others.

(vi)2014 PTD 176 Goodwill Traders, Karachi v. FOP

In the cited judgment the question under consideration was as to how the section 25 of the Customs Act, 1969 is to be applied by the Director General of Valuation for determining the value of the imported and exported goods for issuance of ruling under Section 25-A(1) of the Customs Act, 1969.

12.The established principle of interpretation of the tax law is that the plain language of the law is to be applied. A bare perusal of section 25 shows that it is specifically provided in Subsection (1) of Section 25 that the customs value of the imported goods, subject to the Provisions of this Section and Rules shall be the transaction value i.e. the price actually paid or payable for the goods when sold for export to Pakistan. The detailed guidelines in this behalf are given in subsections (1), (2), (3), (4) and Rules 107 to 116 of Chapter IX of Customs Rules 2001. The provisions contained in Sections 25 (1) to (4) and Rules 107 to 116 of Chapter IX of Customs Rules, 2001 contain primary methods of valuation and in the first instance the primary method of valuation is required to be adopted in each case of the valuation of the imported consignment which is mandatory. Thus, it is very important requirement of law that before resorting to the method provided in Subsection (5) the customs officials shall make an exercise in accordance with the provisions contained in Subsections (1) to (4) of section 25 and if thereafter they find that the customs value of the imported goods cannot be determined under the provisions of subsection (1) they shall resort to the method provided in Subsections (5) and not otherwise. It shall be an exercise duly reflecting on the record so that the appellate forums may examine whether the mandatory requirement of law has been carried out or not. We are fortified in our views in this behalf with the provisions contained in sub-rule (3) of Rule 109 which provides that "when a final decision is made, the appropriate officer shall communicate to the importer in writing his decision and the grounds therefore." In addition to the specific provisions contained in subsection (10) of section 25 to the effect that the methods of customs valuation are required to be applied in a sequential order, we find that it is provided in subsection (6) that, if the customs value of the imported goods cannot be determined under the provisions of subsection (5) the method provided in subsection (7) shall be resorted to and similar provisions are contained in subsections (7), (8) and (9). For the said reason, it is held that different method of valuation provided in section 25 of the Customs Act, 1969 and Customs Rules, 2001 are required to be applied in a sequential order and without visible exercise reflected on record no resort can be made to secondary method of valuation. In this case the Director, Directorate General of Valuation has directly determined the value of compound chocolate under subsections (7) and (9) simultaneously which is unlawful on the face of it as value can either be determined under Subsection (7) or subsection (9) not under both the Subsections and that also after exhausting the exercise conducted under the preceding Subsection of Section 25 of the Customs Act, 1969. The subordinate of respondent no. 1 upon query of the Tribunal stated that the value has been determined after conduction of market inquiry. However, in support of the said fact nothing was placed on the record of the Tribunal. It seems the conducted market inquiry is rowing. Therefore, it is not in accordance with law beside is without the association of the appellant, rendering it without lawful authority and jurisdiction, being patently, in derogation of the provision of Section 25, 25A of the Customs Act, 1969 and Chapter IX of Customs Rules, 2001. Hence, void and ab-initio and cannot allowed to hold field for the purpose of assessment of the imported goods. The illegality of the ruling further stood validated from the fact, that it is not based on rationale and not at all instrumental, increase of the quantum of import, only four consignments had been inclusive of appellant, and were assessed on the basis of the value determined vide Valuation ruling dated 23.12.2013 in spite lapse of more than an year from the date of valuation ruling. This type of determination of value is detrimental for the legal import, making the goods not viable in comparison to available identical/ similar goods in abundance in the local market, which were brought into the country either through smuggling or misuse of Afghan Transit Trade facility.

13.We are also amazed to note that the appellant has justifies his import value in terms of Subsection (7) of Section 25 of the Customs Act, 1969 through working in review application at ground (v) and (vii) of the memo of appeal, veracity of which has not been controverterted either by the respondent No. 1 or his representative during the course of hearing, through tangible evidence or working paper of the market inquiry, except relying upon the comparative chart given in the order, as per which the difference is 20%, which is due to such certain expenses, which a businessman in variably always take into consideration at the time of working out the cost of imported goods for fixation of selling price, as against the subordinate of Respondent no 1 who least take into consideration those and they determine the price in accordance with their own devised formula having no nexus with the financial norms of business and the provision of Section 25 of the Customs Act, 1969. Businessman includes each and every expense incurred from the date of opening of letter of credit/entering into contract till the goods are ready for sale. This half hearted submission confirms that the determined value of Compound Chocolate of Turkey origin by the Director, Directorate General of Valuation is neither correct nor legal. The respondent no. 1 ignored the said vital fact and failed to provide justice to the appellant, which he could had done by re-determining the value under the provision of Section 25A of the Customs Act, 1969, while deciding the Review Application as the legislature has delegated him the powers of Director during the course of hearing review application under the provision of Section 25D of the Customs Act, 1969. The plea that he is not empowered is not correct because if he is not empowered to re-determine the value under section 25A of the Customs Act, 1969, insertion of Section 25D of the Customs Act, 1969 in the Act shall be purposeless infact redundant. This was/is not the intention of the legislature. Rendering the Order-in-Review nullity to the provision of Section 25A and D of the Customs Act, 1969, hence void and ab-initio.

14.The respondent No. 1 for rejecting the Review Application of the appellant also took shelter behind the provision of Section 19A of the Customs Act, 1969 without realizing that it has no nexus with the provision of Sections 25, 25A and 25D ibid., therefore is without substance, as evident from its expression, which read as:--

"Every person who has paid the custom duty and other levies on any good under this Act shall, unless contrary is proved by him, deem to have passed on full incidence of such custom duty and other levies to the buyer as a part of the price such goods."

15.The language of Section 19A says with clarity that "every person who had paid the duty and taxes on any goods levied under the Act has to prove that he has not passed on the full incidence of such custom duties and levies to the buyer as a part of the such price goods", in support of his claim of refund filed under Section 33 of the Customs Act, 1969. To crystallize, it is of vital importance to add that the cases pertaining to Sections 25, 25A and 25D have nothing to do with the provision of Section 19A as in the cases of Section 25A, the Director, Directorate General of Valuation determine the import value of class of goods with the application of different Subsection of Section 25 of the Customs Act, 1969 in sequential manner for levy of duty and taxes by the field formation at the time of passing assessment order under Section 80 and Rule 438 of the Act/Rules. Being aggrieved by the Valuation Ruling, an importer prefers a Review Application before the Director General, Valuation under the provision of Section 25D of the Customs Act, 1969. The described job of the Directorate General Valuation is to determine the value of the imported/exported goods. In determination of value, Section 19A has no part to play, being specific and for the purpose of refund. While filing Review Application against the valuation ruling, applicant prays for the re-determination of the value of the goods imported or exported by him by the respondent no. 1 himself. The Review Application cannot be termed through any stretch of imagination an application for refund. Beside the respondent No. 1 nor his subordinate are the appropriate defined authorities before which a refund application is allowed to be filed under the Act nor they are empowered to either process/sanction the refund. The entire exercise by them has to be carried out within the parameter of the expression of Sections 25, 25A and 25D of the Customs Act, 1969 and Chapter IX of Customs Rules, 2001. Therefore reliance on Section 19A by the respondent no. 1 is uncalled for and ab-initio wrong and therefore without lawful authority/jurisdiction.

16.The appellant in the ground of appeal has raised a vital and important question that as soon as he challenged the Valuation Ruling before the respondent no. 1 through Review Application, it is mandated upon him to direct the subordinate of respondent No. 2 to complete the assessment of his forthcoming consignments under the provision of Section 81 of the Customs Act, 1969 and likewise the competent authority expressed in Section 81 of the Customs Act, 1969 to complete the assessment of his consignment provisionally under section 81 of the Customs Act, 1969 upon submission of copy of Review Application as the valuation ruling to the extend of appellant or the importer standing on the same pedestal stood un-operative, by virtue of the fact that the Ruling stood wide open immediately upon filing Review under the provision of section 25D of the Customs Act, 1969 and this stood fortified from the judgments of the Hon'ble Supreme Court of Pakistan in reported judgments 1993 SCMR 39 CBR v. Chanda Motors and 2013 PTD 581 Ghulam Nabi v. FOP of the honorable Supreme court of Pakistan. In nullity to the law laid down by the Superior Judicial Foras neither the respondent no. 1 stayed the application of Valuation Ruling nor directed the subordinate of respondent No. 2 to complete the assessment of the appellants /importers forthcoming consignments provisionally under section 81 of the Customs Act, 1969. Similarly, the subordinates of respondent no 2 declined to exercise the power delegated upon them under the provision of Section 81 to complete the assessment of the consignment under the said Section, on the plea that either permission has to be sought by the appellant /importer from the Additional Collector or Collector, the appellant has prayed to declare the verbal/written direction of the Collector of Customs (subordinate of respondent No. 2) without lawful authority and jurisdiction.

17.It is settled proposition of law that when an initial order is challenged through an Appeal or Review Application, the order so assailed reopens for decision by the Reviewing/Appellate Authority. Therefore, upon challenging the Valuation Ruling through Review Application under the provision of Section 25D of the Customs Act, 1969, it stood reopened for re-determining of value by the respondent No. 1. Therefore, in accordance with the norms of justice and fair play, it was mandated upon the respondent No. 1 to immediately pass stay order on filed Review Application or at least issue direction to the subordinate of respondent No. 2 to complete the assessment of the forthcoming consignment of the appellant/importer under the provision of Section 81 of the Customs Act, 1969 as the determined value through Ruling stood sub-judice before him and thus un-operational to the extend of imported goods of Turkey origin, this is proper and just approach in consonance with the law laid down by the Hon'ble Supreme Court of Pakistan in reported judgment 1993 SCMR 39 Central Board of Revenue and others v. Chanda Motors, paras 17 to 22 of which are read as follows:--

"17-. Word "finalized" is derived from the word "final" which is define in Chambers 20th Century Dictionary to mean "last decisive, conclusive: respecting the end or motive of a judgment ready for execution- last of series". "Finality" is defined as state of being final completeness or conclusiveness. In Black's Law Dictionary Fifth Edition, word "final" is defined as, "last; conclusive, decisive, definitive; terminated; and completed." In it's used in reference to legal actions this word is generally contrasted with "inter-locatory". Viewed in the light of meanings of the word "assessments" and "finalized", it appears that assessment order as such do not have touch of finality unless all the forum are exhausted in which such orders can be challenged so that the order take the final decision."

18.Legally speaking order of assessment passed by Income Tax Officer is an order of original authority but is not final for the reason that it can be challenged in appeal or revision as the case may be and would be final only when it goes through all the forums and the finding of the last forum shall be binding as conclusive.

19.The question whether appeals and other remedies provided under the law formed part of proceedings or not came up for consideration before the Supreme Court of India in the case of Garikapati Veeraya v. N.Subbiah Choudhry and others reported in PLD 1957 Supreme Court (India.) 448 it is held as per majority opinion that legal pursuit of a remedy, suit, appeal and 2nd appeal are really but steps in a series of proceedings all connected by an intrinsic unity and are to be regarded as one legal proceeding. Reference can be made to the case of Commissioner of Wealth Tax v. Vimlaban Vadilal Mehta reported in (1984) 145 ITR 11, in which it is held that it is well settled that when an appeal is filed against assessment order before AAC the assessment is thrown open and Appellate proceeding constitute a continuation of a assessment proceeding."

20.In the case of F.A. Khan v. the Government of Pakistan (PLD 1964 Supreme Court) 520, question came up for consideration that in the case of dismissal of a Government servant for filing a declaratory suit whether limitation would start from the date of order of dismissal to be reckoned under Article 120 of the Limitation Act or from the date of order of Appellate Authority confirming the first order to be reckoned under Article 58 of the Limitation Act. It is held that such right accrued on the date of dismissal but, where there is an appeal on the date of Appellate order upholding dismissal. It is further held that the legislature when its provided a hierarchy of the Tribunal for the determination of a dispute it is really providing one complete procedure for such determination, proceeding before different Tribunal being only step in this procedure.

21.On the question construction, in the light of what is stated above, it can be said without fear of contradiction that order passed in original proceedings is not final unless it crosses all the forums set up under that law in which it can be challenged and the order of the last forum would become final. Mr. Rehan Hassan Naqvi, learned counsel for the respondent has submitted before us that there is plethora of case law on the point that even within the frame work of Income Tax law, appeals and other remedies provided therein formed part of the same proceedings regarding assessment. In this context our attention is drawn to the case of Chatturam and others v. Commissioner of Income Tax, Bihar reported in (1947) 15 ITR 302. In the reported case assesses of partially excluded areas were served with the notices under section 22(2) of the Income Tax Act for furnishing returns. Subsequently Governor of Bihar by notification directed that India Income Tax (Amendment) Act, 1939, the Income Tax law Amendment Act, 1940 should be deemed to have been applied to the Chotanagpur Division containing partially excluded areas with retrospective effect. Subsequently Regulation 1 of 1941 was also issued by the Governor to remove doubts as to the retrospective applicability of the Act mentioned in the Notification. Assesses were assessed and their appeals were pending when Regulation 1 of 1941 was issued. It was contended that assessment proceedings initiated and completed against them were invalid and neither the notification nor the Regulation were competent in law to validate those proceedings, it was held by the Federal Court of India, inter alia, that appeals to the Appellate Assistant commissioner were an integral part of the machinery of assessment and therefore it could not be contended that assessment proceedings were over when Regulation 1 of 1941 was made and the Regulation could not apply to the proceedings covered by those appeals.

22.Coming down to the non adherence of the provision of Section 81 by the authority defined therein on the plea that unless permission is not given by either Additional Collector of Collector, he will not exercise the powers vested specifically upon him, we feel appropriate to reproduce the provision of Section 81 (1) of the Customs Act, 1969:

81. Provisional determination of liability.---(1) Where it is not possible for an officer of Customs during the checking of the goods declaration to satisfy himself of the correctness of the assessment of the goods made under section 79, for reasons that the goods require chemical or other test or a further inquiry, an officer, not below the rank of Assistant Collector of Customs, may order that the duty, taxes and other charges payable on such goods, be determined provisionally:

Provided that the importer, save in the case of goods entered for warehousing, pays such additional amount on the basis of provisional assessment or furnishes bank guarantee [or pay order] or a post-dated cheque of a scheduled bank along with an indemnity bond for the payment thereof as the said officer deems sufficient to meet the likely differential between the final determination of duty over the amount determined provisionally:

Provided further that there shall be no provisional assessment under this section if no differential amount of duty and tax is paid or secured against bank guarantee [or pay order] or post-dated cheque.

[(2) Where any goods are allowed to be cleared or delivered on the basis of such provisional determination, the amount of duty, taxes and charges correctly payable on those goods shall be determined within six months of the date of provisional determination:

Provided that the Collector of Customs or, as the case may be, Director of Valuation, may in circumstances of exceptional nature and after recording such circumstances, extend the period for final determination which shall in no case exceed ninety days.

Provided further that any period, during which the proceedings are adjourned on account of a stay order or for want of clarification from the Board or the time taken through adjournment by the importer, shall be excluded for the computation of aforesaid periods

(3) On completion of final determination, the amount already paid or guaranteed shall be adjusted against the amount payable on the basis of final determination, and the difference between the two amounts shall be paid forthwith to or by the importer, as the case may be.

(4) If the final determination is not made with the period specified in subsection (2), the provisional determination shall, in the absence of any new evidence, be deemed to be the final determination.

(5) On completion of final determination under sub-section (3) or (4), the appropriate officer shall issue an order for adjustment, refund or recovery of amount determined, as the case may be.

Explanation.- Provisional assessment means the amount of duties and taxes paid or secured against bank guarantee or post-dated cheques.

23.Upon bare reading of Section 81, it is observed that the expression says that where it is not possible for the Officer of Customs during the checking of the Goods Declaration to satisfy himself of the correctness of the assessment of the goods made under Section 79, for reason that the goods required chemical or other test or a further inquiry, an Officer not below the rank of Assistant Collector of Customs, may order the duty, taxes and other charges payable on such goods be determined provisionally. Section 81 further prescribes mode and manner for releasing the goods through provisional assessment, subsequently has to made further inquiry as deem necessary for the purpose of final determination of duty over the amount determined provisionally. The differential amount between the declared and tentative determined amount has to be secured bank guarantee or pay order, which according to him is sufficient. Here the question arrives as to how the duty, taxes and other charges payable on such goods to be determined provisionally. The law is silent on the point as to what is meant by provisional determination and how it is to be made. However, in the instant case provisional determination of value could had been made while securing differential amount of duty, taxes and other charges between the declared value and payable on the value determined through Valuation Ruling by the Director, Directorate General of Valuation under Section 25A of the Customs Act, 1969 subject to finalization under subsection (4) upon issuance of Order-in-Review by the respondent no. 1 in the application filed by the appellant under Section 25D ibid. In this manner the interest of Revenue is fully protected and no undue harassment shall be caused to the importer. The tenor of the language shows that the legislature has made substantial provision for protecting the interest of Revenue in case of release of the goods on provisional assessment under Section 81 and has allowed sufficient time to the Custom Official for making necessary inquiry/probe to determine the final valuation under Section 80; the purpose of making these provision is to protect the State Revenue in a manner that the Trade and Industry is allowed to run smoothly.

24.The respondent no. 1 either should had stayed the application of Valuation Ruling on the consignment of the appellant or would had directed the subordinate of respondent No. 2 to complete the assessment of the appellant forthcoming consignments under the provision of Section 81 of the Customs Act, 1969. Likewise it is mandated upon the authority defined in section 81 to allow the clearance of the appellant consignment under the provision of Section 81 of the Customs Act, 1969 upon presentation of photocopy of the Review Application as it is just and proper course of action. The authority defined in Section 81 can exercise the powers vested upon him under Section 81 to complete the assessment of any consignment under the said provisions freely and independently, in case of any dispute in regards to value, classification applicability of notification etc. None of the Superior Authority is empowered to restrain him in exercising of powers under any pretext i.e. either through verbal or written orders. Nobody is permitted to do so or encroached the jurisdiction specifically vested upon him under the statute. Rendering the verbal and written orders of the Collector of Customs, as of no legal authority/jurisdiction, ab-initio and void. Our opinion is validated from the judgment reported at 2014 PTD 525 Waseem Radio Traders v. FOP, wherein it has been held that in para 10 to 12 as under:--

"10- The purpose of these provisions is not only to protect the revenue of the State but also provide smooth flow of Trader if the interpretation given by the learned counsel for the respondents / department is accepted it will result that the importer will be rest at the mercy of the Customs Authorities which cannot be intention of the Legislature.

11. Therefore, when there is a dispute between the importer and the appropriate officer of the customs with regards to the value of imported goods the importer have a right to get his goods cleared under section 81 of the Customs Act, 1969.

12. In the present case there is a dispute between the importer and the appropriate officer of the Customs regarding value, therefore importer for the release of their goods under section 81 of the Customs Act, 1969, on payment of duty and taxes on the declared value , whereas difference between the declared value and the value under Valuation Ruling has to be secured by way of bank guarantee to the satisfaction of the Collector concerned.

25.The right of the importer and the Customs Officer has been defined in context to Section 81 by their lordship Muhammad Mujibullah Siddiqui and Sajjad Ali Shah JJ in reported judgment 2006 PTD 909 Rehan Umar v. Collector of Customs, Karachi and 2 others in the following words:--

"If it is not possible for the customs to determined the final tax liability for the reason that the chemical or other test a further inquiry is required then it give right to the importer to get the goods released on payment of duty and taxes assessed by him under section 79 and on furnishing of bank guarantee or a post dated cheque of a schedule bank along with indemnity bond for payment of differential amount as determined by customs officials. In such situation the importer should not be left on the mercy of Assistant collector of Customs or any officer above in rank. It is therefore, held that if the declared value in the Bill of entry is not acceptable to the appropriate officer of the customs department and the value can not be determined under the provision of subsection (1) of Section 25 and resort is to be made to other method provided in section 25 of the Customs Act, then the importer is entitle for the release of the goods under Section 81 of the Customs Act, 1969 by provisional determination of liability. The release of the goods in such a manner is a matter of right of importer and not a matter of concession within the appropriate officer of the Customs. (emphasis supplied)

26.On the basis of deliberation made in paras supra, we set aside the Order-in Review No. 40/2014 dated 16.04.2014 in totality and Valuation Ruling No. 625/2013 dated 23.12.2013 for determination of value for levy of Sales Tax and Income Tax and to the extent of value determined for levy of customs duty of Compound Chocolate of Turkey origin and accept the appeal as prayed. We also direct the respondent no. 1 to adhere the observation made in the order and respondent No. 2 to issue direction to the Collectors of the Clearance Collectorate to withdraw the issued verbal/written orders in derogation of the Provision of Section 81 of the Customs Act, 1969 and let the authority enunciated in Subsection (1) to exercise his powers independently, fairly, justly and in accordance with its expression and the law laid down by the Superior Judicial Fora.

27.Judgment passed and announced accordingly.

RR/5/Tax(Trib.)Order accordingly.