MUHAMMAD ILYAS VS DIRECTOR GENERAL OF PCA, KARACHI, 2016 PTD-CUSTOMS-APPELLATE-TRIBUNAL-LAHORE 843 (2015)

2016 P T D (Trib.) 843

[Customs Appellate Tribunal]

Before Adnan Ahmed, Member (Judicial-II)

MUHAMMAD ILYAS

Versus

DIRECTOR GENERAL OF PCA, KARACHI and 2 others

Cus. Appeal No. K-1606 of 2014, decided on 25/02/2015.

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

----S. 215---Service of order---Appeal---Importer's plea that appeal was filed within thirty days from date of service of order and was within time---Held, that no objection had been inscribed by department regarding limitation---Department in circumstances, had no reason to form opinion regarding limitation---Appeal was filed within time and as such had to be decided on merit instead of technicalities.

Case-law referred.

(b) Income Tax Ordinance (XLIX of 2001)---

----Ss. 228, 230A & 207---Directorate General Inspection, establishment of---According to S. 228 of Income Tax Ordinance, 2001, Director General of PCA (Customs) had not been appointed/designated as Officer of Inland Revenue by legislature for overseeing collection of withholding tax by authorized agents---For such purposes, Directorate General of Withholding Taxes had been established under S. 230A of Income Tax Ordinance, 2001---Customs department was not empowered at all under S. 207 of Income Tax Ordinance, 2001 to exercise powers to conduct audit under S. 177 of Income Tax Ordinance, 2001 for collection of Income Tax at import stage---Such action of customs department would render entire act of audit and subsequent proceedings by Customs department without powers/jurisdiction and as such coram non-judice.

Case-law referred.

(c) Sales Tax Act (VII of 1990)---

----Ss. 36 & 30---Income Tax Ordinance (XLIX of 2001), Ss. 148, 228, 207 & 106(2)---Collection of sales tax and income tax by Customs authorities---Customs department had invoked S. 36 of Sales Tax Act, 1990 and S. 148 of Income Tax Ordinance, 2001 while issuing show-cause notice to the importer---Importer's plea was that Customs department had not been appointed as Officer of Inland Revenue under S. 30 of Sales Tax Act, 1990 and S. 228 of Income Tax Ordinance, 2001 and had no powers to proceed in matter of Sales Tax and Income Tax for recovery of short collected/paid taxes---Validity---According to S. 30 of Sales Tax Act, 1990 and S. 207 of Income Tax Ordinance, 2001, legislature had appointed Federal Board of Revenue as Officer of Inland Revenue for exercising powers under respective sections of Act/ Ordinance, delegated through notifications---Customs department was never appointed as Officer of Inland Revenue and therefore it could not lay hands on any matter falling under S. 36 of Sales Tax Act, 1990 and S. 162(1) of Income Tax Ordinance, 2001.

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

----Ss. 25 & 202---Sales Tax Act (VII of 1990), Ss. 6,36 & 48---Income Tax Ordinance (XLIX of 2001), Ss. 140, 148 & 162(1)---Collection of taxes on imported goods by Customs authorities---Section 6 of Sales Tax Act, 1990 and S.148 of Income Tax Ordinance, 2001 had empowered Customs department to collect taxes on imported goods like customs duty on value determined under S. 25 of Customs Act, 1969---Said provisions of laws least empowered the Customs department to initiate adjudication/recovery proceeding for short collected/paid Sales Tax and Income Tax either due to collusion or connivance or inadvertent, error or misconstruction---In order to initiate proceedings for recovery, a show-cause notice had to be issued under S. 36 of Sales Tax Act, 1990 and S. 162(1) of Income Tax Ordinance, 2001---Authority to issue such show-cause notice had to be the Officer of Inland Revenue and Commissioner of Income Tax---Customs department had power only to collect Sales Tax and Income tax at import stage and not post importation---Plea that Customs department was empowered to recover short paid amount at import stage under S.202 of Customs Act, 1969 was based on mistaken belief---Customs department could recover amount of Sales Tax and Income Tax on behalf of Inland Revenue upon receipt of notice from Office of Sales Tax and Commissioner of Income Tax under S. 48 of Sales Tax, 1990 and S.140 of Income Tax Ordinance for recovery of adjudged amount of taxes after due process of law.

Case-law referred.

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

----Ss. 25, 25A, 32 & 202---S.R.O. No. 495(I)/2007, dated 9-6-2007---Directorate General of Valuation had been delegated powers under S.R.O. No. 495(I)/2007, dated 9-6-2007 read with Para 44 of CGO 12/2002 dated 15-6-2002 to adjudicate cases falling under Ss. 25, 25A & 32 of Customs Act, 1969 and to initiate action for recovery of Government dues thereafter under S. 202 of Customs Act, 1969 read with Customs Rules, 2001---Customs department had encroached specific notified territory of Directorate General of Valuation by laying hands on matter relating to Ss. 25 & 25A of Customs Act, 1969 and issuing order for recovery under S. 202 of Customs Act, 1969---Order passed by Customs department was without power/ jurisdiction and lawful authority.

Case-law referred.

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

----S.193A---Order in appeal---Appeal was filed on 23-11-2012, order under S. 193A(3) of Customs Act, 1969 should have been passed within 120 days from date of filing of appeal i.e. on or before 23-03-2013 or within a further extended period of 60 days during initial period of 120 days with reasons to be recorded for extension in writing after serving a notice to person concerned---No extension having been granted by department prior to expiry of initial period of 120 days, order was passed after 778 days from date of filing of an appeal was barred by time by 658 days---Appeal was liable to be dismissed.

Case-law referred.

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

----Ss. 32, 2(a), 25A & 80---S.R.O. 371(I)/2002, dated 15-6-2002---Customs Rules, 2001, R 438---Allegation of mis-declaration of valuation ruling---Importer had been charged for mis-declaration under S. 32 of Customs Act, 1969 on basis of allegation of non-application of valuation ruling---"Appropriate authority" as defined in S.2(a) of Customs Act, 1969 had been mandated to pass assessment order under S.80 of Customs Act, 1969 and R. 438 of Sub-Chapter (III) of Chapter XXI of Customs Rules, 2001 while exercising powers delegated upon it through S.R.O. No. 371(I)/2002, dated 15-6-2002 on valuation ruling---Application of valuation ruling did not attract S.32 of Customs Act, 1969 as such application was not a document which was a declaration by importer and no column was available in prescribed GD to be filed by an importer online for obtaining clearance of goods, rendering charge of mis-declaration under S. 32 as of no substance and legal effect---Valuation ruling issued under S. 25A of Customs Act, 1969 was for the purpose of assessment and not for charging importer for misdeclaration of value---Charge of mis-declaration of value had to be leveled on basis of direct evidence.

Case-law referred.

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

----Ss. 80 & 83---Customs Rules 2001, Rr. 438 & 442---If valuation ruling had not been applied at time of assessment under S. 80 of Customs Act, 1969 and R. 438 of Sub-Chapter (III) of Chapter XXI of Customs Rules, 2001, said provisions could not be applied subsequently after clearance of goods under S. 83 of Customs Act, 1969 and R. 442 of Sub-Chapter (III) of Chapter XXI of Customs Rules, 2001 by competent authority enunciated in S. 83 of Customs Act, 1969.

Case-law referred.

(i) General Clauses Act (X of 1897)---

----S.24A---"Speaking order", essentials of---Direction of Federal Board of Revenue and mandated requirement of General Clauses Act, 1897 had to be adhered to by department while passing an order---Department had intentionally and purposely not rebutted a single ground of appeal filed before it and passed a very sketchy, slipshod, vague, cursory and non-speaking order, confirming that it had not been passed on objective consideration rather on personal whims and wishes and inapt interpretation of law---Such type of order was termed as illegal, void, arbitrary and a result of misuse of authority---Department had no authority to pass such illegal, void and arbitrary order---If any Authority, Court or Tribunal gave a finding of fact which was not based on material available on record, findings so given was illegal, arbitrary and became perverse which was violative of principles of appreciation of evidence on record and as such not sustainable in law---Appeal was allowed, accordingly.

(j) Administration of justice---

----Speaking order---Every Judicial/Quasi-Judicial order be based on a reasoning containing justification for finding given in order, in absence of the same, order so issued was in derogation of principles of dispensation of justice.

Nadeem Ahmed Mirza (Consultant), Obayd Mirza and Mirza Muhammad Abeer Nadeem for Appellant.

Faiz Mudassir for Respondent No.1.

Kosar Hussain for Respondent No.2.

Date of hearing: 17th December, 2014.

ORDER

ADNAN AHMED, MEMBER (JUDICIAL-II).---The appeal, filed by the appellant, is directed against Order-in-Appeal No.9209/2014 dated 12.09.2014 passed by Collector of Customs (Appeals) (here-in-after to be referred as respondent No.3) maintaining the Order-in-Original No. 132/2013 dated 23.01.2012 passed by the Deputy Collector of Customs (Adjudication-II), MCC of PaCCS, Custom House, Karachi (here-in-after to be referred as respondent No. 2).

2.Briefly, facts of the case as stated in the show cause notice by the respondent No. 1 are that the appellant imported a consignment of H/T PPINJ Trolly Suit Cases and got the same cleared through MCC (Paccs) at declared value by filing GD CRN I-HC-1783987-11.04.2011. The clearance of subject H/T PPINJ Trolly Suit Cases at declared value is patently wrong as their prevailed a Valuation Ruling 297 dated 12.03.2011, issued by Directorate General of Valuation under section 25-A of the Customs Act, 1969 at the time of clearance of the instant goods. There existed substantial difference between the declared value and the value notified vide aforementioned valuation ruling. The incorrect assessment of the subject imported goods has caused a revenue loss of Rs. 471,649.00. In view of the aforementioned, the appellant have intentionally and willfully caused loss of Government Revenue amounting to Rs. 471,649.00 by evading the leviable duty and taxes which tantamount to violation of the relevant provision of law and the respondent No. 2 held the charges against the appellant had been proved and passed the impugned order the operative part of the impugned order read as under:

"I have gone through the available record of the case. The reply of the importer to show cause notice has been examined carefully. They did not enclosed Annexures with their reply as they quoted in their reply. The claim that Valuation ruling No. 297 dated 12.03.2011 is not related to the description of the goods they imported has been perused the importer declared description of the goods "H/T PPINJ Trolly Case/Suit Cases" and the description of goods given at S.No.7 to the said Valuation Ruling "Suit Case Hard Type". The comparison of the both description in the said ruling. Therefore the claim of the importers that the imported goods are not similar/identical to the valuation ruling is not correct and they have no plausible rebuttal to the aforesaid legal position. The stance of PCA regards the Valuation Ruling No.297 dated 12.03.2011 is plausible and accepted. Furthermore, the importer deliberately try to mention the date of good declaration as 11.01.2011 instead of 11.04.2011 in order to avoid the Valuation Ruling dated 12.03.2011. I do not find any reason to against the charges leveled in the show cause notice. Thus the charges leveled in the show cause notice are established. The act of importer attracts sections 32(1), 32(2) and 32(a) of the Customs Act, 1969. I, therefore order to recover the Government Duties and Taxes amounting to Rs. 471,649.00 along with surcharge in terms of Section 83(2) of the Act, failing which the short levied amount will be recover in terms of Section 202 of the Customs Act, 1969. I also impose a personal penalty of Rs. 25,000.00 on the importer/NTN holder."

3.The order was challenged before Respondent No.3 by the appellant vide Appeal No. 4339/2012 dated 23.11.2012, who also vide his order dated 12.09.2014 rejected the appeal by observing in para 5 that:

"I have examined the record of the case. It is concluded that imported goods are Hard Suit Cases which come within the ambit of Valuation Ruling 297 dated 12.03.2011. Therefore charged leveled in the original order stand established. The appeal is also barred by limitation to the extent of approx. Nine (09) months the appeal is rejected."

4.The appellant has challenged the order of the respondent No. 3 by way of the instant appeal the consultants/advocates argued on the strength of the grounds incorporated in the memo of appeal and which are inter alia:

(i)The respondent No. 3 has stated in his order that the appeal filed by the appellant is time barred, the said observation is totally nullity to the fact and in derogation of Section 215 of the Customs Act, 1969, which explicitly enunciate that the order so passed has to be served on the person against whom the order has been passed. In the instant case of appellant order was not served and was hand delivered to the appellant on 07.11.2012. Upon receipt of which appeal was filed on 23.11.2012 well before the stipulated period of 30 days.

(ii)In support of his stance the appellant states that, it is settled principle of law that it is not enough to pass an order or marked on that as issued, instead it has to be served as per the expression of Section 215 of the Customs Act, 1969. The respondent No. 2 deliberately and with mala fide intention has not dispatched the order-in-original to the appellant immediately after passing/issuing. This act of his nullity to the paramount requirement for the word "served". The same view was held by the High Court of Sindh in reported judgment PLD 1989 (sic) 518(2). Wherein, their Lordship of the High Court has held in categorical terms that "It is enough that the notice/order is merely issued; it service is mandatory in law. Unless notice is proven to have been served, within the prescribed period, the same would not be considered to be in accordance with the requirement of the Act. The said order came under judicious scrutiny of the Apex Court. Which through reported judgment 2002 UC 506 Supreme Court held that "that the requirement of section 32 as to the service of the show cause notice had been complied with. It was observed that the Board had failed to produce the copy of the notice or any evidence of the service of the notice in spite of the order of the Court and in spite of the order of the challenge made in the petition in paras 10 and 11, that no demand by the notice dated 29.06.1978 was ever made. There was also no evidence of service of notice dated 19.07.1978, within the period specified in section 32(3). Even otherwise, no evidence had been produced to the court, to show , that the notice was tendered to the importer, in accordance with the provisions of section 215 of the Customs Act, 1969. Whereas, the High Court of Sindh in reported judgment 2006 PTD 1207 held that "We are afraid such high handedness on the part of officer vested with the extensive powers for recovery of the public revenue has to be strongly discouraged . No date of hearing was ever notified to the petitioner and nor the said order was communicated. Therefore as held by the superior judicial fora the order-in-original dated 23.12.2012 was not served on the appellant.

(iii)That the respondent No. 1 (Directorate General of Post Clearance Audit) are not designated as officer of Inland Revenue under the provision Section 30 of Sales Tax Act, 1990 and under any provision of the Income Tax Ordinance, 2001 and as such are not empowered to carry out audit in respect of Sales Tax and Income Tax under the provision of Section 25 of the Sales Tax Act, 1990 and Section 177 of Income Tax Ordinance, 2001. Thus the whole exercise conducted by the respondent No. 1 in the case of appellant is coram-non-judice.

(iv)That similarly the respondent No. 2 is not designated an officer of Inland Revenue under the provision of Clause (c) of subsection (3) of section 25 of the Sales Tax Act, 1990 and section 120 of the Income Tax Ordinance, 2001 and as such is not empowered to issue show cause notice and pass order-in-original in respect of matter relating to Income Tax under the provision of Section 36 of the Sales Tax Act, 1990 and Section 162(1) of Income Tax Ordinance, 2001. Hence, by issuing show cause notice and passing order-in-original the respondent No. 2 usurp the power of officer of Inland Revenue to which he is not vested, rendering the show cause notice and subsequent passed order-in-original without power/jurisdiction, hence void and ab-initio.

(v)The appropriate adjudicating authority as per expression of Sections 2(a) and 2(b) of the Customs Act, 1969 after post importation audit is the officer of Directorate General of Valuation in terms of S.R.O. 495(I)/2007 dated 09.06.2007 and para 44 of Customs General Order 12/2002 dated 15.06.2002. Rendering the whole act of respondent No. 2 suffers from lack of powers/jurisdiction, hence the contravention report/show cause notice and order-in-original are ab-initio, null and void as held in the reported judgment Major Syed Walayat Shah v. Muzaffar Khan and 2 others (PLD 1971 SC 184), Omer and Company v. Controller of Customs, (Valuation); (1992 ALD 449(1) Karachi AAA Steel Mills Ltd v. Collector of Sales Tax and Central Excise Collectorate of Sales Tax (2004 PTD 624), PLD 1976 Supreme Court 514 Ali Muhammad v. Hussain Buksh and others and PLD 2001 SC 514 Land Acquisition Collector, Noshehra and others v. Sarfraz Khan and others 2006 PTD 2237, Pak Suzuki Motors Company Ltd., Karachi v. Collector of Customs, Karachi, 2009 PTD (Trib.) 1996 and 2010 PTD(Trib.) 832.

(vi)That any order pass by the Adjudicating Authority as per the definition given in Section 2(a) of the Customs Act, 1969 under the provision of Sections 80 and 83 ibid and Rules 438 and 442 of the Customs Rules, 2001 can only be corrected by the revisional authority in exercise of the power of Section 195 of the Customs Act, 1969, which empowers the Board or Collector of Customs to examine su-motu the record of any proceeding under this act for the purpose of satisfying itself or the case may be, himself as to the legality or propriety of any decision or order passed by subordinate officer as has been done in the case of M/s. World Trading Communication and subsequent of that assessment order dated 13.01.2012 was passed. Meaning thereby that after reopening the existing order the Board or Collector may pass afresh order to as it or he may deem think fit after issuance of show cause notice to the effected person in exercise of the power vested under Section 195 of the Customs Act, 1969. Neither the respondent No. 1 nor respondent No. 2 are vested with the powers under Section 195 of the Customs Act, 1969. Both usurped the powers not vested with them. Resultant, the act of preparing contravention report and issuance of show cause notice and passing of order-in-original suffer from lack of power under the said provision rendering these void and ab-inito as held by Superior Court of Pakistan in umpteenth judgments e.g. PLD 1975 SC 331, S.T. Appeal No. 984/98, S.T. Appeal 72/04, S.T. Appeal 54/09, S.T. Appeal No. 2352/99, S.T. Appeal No. 106/03, 2002 CLC 705, 2004 PTD 624, 2004 PTD 3020, 2007 PTD 1895, 2009 PTD (Trib.) 1925, 2005 PTD (Trib.) 135, 2010 PTD (Trib.) 759, 2010 PTD Trib.) 1283, Customs Appeal No. K-44/2010 and Customs Appeals Nos. K-435/08 to 455/08, 2010 PTD (Trib) 2523 and K-638/ 2010- 727/2010.

(vii)The audit observation issued by respondent No. 1 and show cause notice/order-in-original issued/passed by respondent No. 2 transpires that charges against the appellant has been held under the provision of sections 32(1), 32(2) & 32(A) of the Customs Act, 1969. Which are based on inapt interpretation of the provisions of the Act, as for holding charges under Section 32(1) of the Customs Act, 1969 no misdeclaration is found, whereas under Section 32(2) an element of "collusion" should be available and under the provision of Section 32-A the documents so submitted should had been concocted, altered, mutilated false, forged, tampered or counterfeit. Nothing in this regard have been proved in material particular as evident from the order. The stance of the appellant is supported by the observation of Hon'ble High Court of Sindh in judgment reported as PLD 1996 Karachi 68 that higher degree of proof is required for initiating penal provisions against the accused.

(viii) That according to the show cause notice/order-in-original it was mandated upon the respondent No. 2 to construe in the light of the Act, for between a "declaration" or "a statement in answer to any question put" and a "claim". As regard declaration it means a communication by a person in relation to a business been conducted. The word "declaration" came to judicious scrutiny in the case of Withoba Cyamna v. Union of India reported as AIR 1957 Bombay 32. It was held in that case that the word "declaration" referred to the nature, description, PCT Heading and value of the goods so that assessing officer can apply appropriate tariff rate for assessment and charging. On the other hand the word "claim" means a demand for something supposed due to, or demanded as a right.

(ix)That the show cause notice does not speaks about any charge against the appellant in regards to misdeclaration or fiscal fraud falling under sections 32(1)(2) and 32(A) of the Customs Act, 1969 in material particular, instead speaks dereliction of duties and negligence on the part of the officials of MCC of PaCCS, who wrongly assessed the goods with the non application of valuation ruling. In the case of Eastern Rice Syndicate v. Collector of Customs (PLD 1959 SC 364) the Supreme Court had held that in order to attract penal provision of Section 39 (now Section 32), it must be established that the person who alleged to have made any statement in a document, submitted to the customs authorities must be false to his knowledge, and it would depend upon the circumstances of each case. It is not disputed here that the statement made in the Customs Documents by appellant regarding the nature of the goods imported were in any way wrong; rather that information was found correct and true.

(x)That in the circumstance narrated above, the case of appellant utmost falls under Section 32(3) instead of 32(2) or 32(3A) of the Customs Act, 1969, whereas the demand raised against the appellant is by the respondents through audit observation, show cause notice and order-in-original. A demand under section 32(3) could only be raised by the Principal Appraiser being an appropriate officer as expressed in Section 2(b) ibid in exercise of the power vested upon him under S.R.O. 371(I)/ 2002 dated 15.06.2002. It is settled elementary principal of law that action of executive functionaries are to be restricted to specific sphere permitted by the statute. If the superior or sub-ordinates authority started exercising powers of their subordinates/superiors, the hierarchy of distribution of jurisdiction explicitly provided by Section 179 of the Act and S.R.O. 371(I)/2002 dated 15.06.2002 shall be rendered redundant. Also the consequent result would be a total anarchy where the superior officers would be making all efforts to exercise the adjudication powers clearly conferred by law upon their subordinates. The powers of adjudication are specific and empowered by the statute and Rules and Regulation framed there under. It is an elementary principle of law that where there is a conflict between special and general provision of law, the special provision shall prevails (reference is invited to the case of Lt. General (Retd.) Shah Rafi Alam v. Lahore Race Club, 2004 CLD 373. The power of adjudication, as already observed, is special in nature. This cannot be eclipsed by any other general provision. Even otherwise there is another settled principal of interpretation of statute i.e. that the courts can supply construction with a view to avoiding absurdity (reference is invited to the case of Khalid Qureshi v. UBL 2001 SCMR 103). Equally it must be kept in mind that if it is held that sections 4 and 179 occupy the same fields, there is likely to be redundancy in respect of powers conferred under section 179 and S.R.O. 371(I)/2002 dated 15.06.2002. The Supreme Court in the case of East West Steamship v. Queen Land Insurance PLD 1963 SC 663 has been pleased to hold that redundancy is to be avoided in respect of any provision of the statute and Rules and Regulation framed there under (reference is invited to the case of Sahibzada Sharfuddin v. Town Committee 1984 CLC 1517. Apart from this law favour actions of the authorities to be confined to their own spheres of jurisdiction conferred by the statute. An action taken by a state functionary beyond the ambit of his jurisdiction is nullity. In this respect the judgment reported as Abida Rashid v. Secretary, Government of Sindh PLD 1995 Kar. 587 is referred. Their lordship observed as under:

"it is trite law that power vested in an authority should only be exercised by that authority, in default whereof, the exercise of power and authority becomes without jurisdiction, illegal, void , ab-initio and of no legal effect. The term "without jurisdiction" has been judicially interpreted to include usurpation of power warranted by law (The Chief Settlement Commissioner Lahore v. Raja Muhammad Fazil Khan and others PLD 1975(sic) @ p.339) an act done which the person doing, it has no jurisdiction at all to do or which was clearly outside the scope of his activities (The State v. Zia-ur-Rehman PLD 1973 SC 49) and a judgment or order delivered by a court or a judicial or a quasi judicial authority not competent to deliver it (Muhammad Saleh and others v M/s. United Grain and Fooder Agencies PLD 1964 SC 97). The Constitution jurisdiction can thus be exercise when it is shown that the order is passed without jurisdiction or in excess of jurisdiction. As observed earlier the respondent No.1 has no jurisdiction to pass the impugned order. As such we declare the same to be of no legal effect. Accordingly, we allow this petition but leave the parties to bear their own cost".

(xi)That while dealing with the powers of adjudication, it is needless to observe, that our Supreme Court has jealously guarded the same. In Assistant Director v. B.R. Herman Mohata Ltd. PLD 1992 SC 485. A full bench of Supreme Court was pleased to observe that section 223 of the Customs Act, 1969 could not be employed so as to interfere with the judicial or quasi judicial functionaries. It was clearly observed that the power of the CBR as to prescribed guideline were not relevant for the exercise of judicial function. To similar effect is the judgment of Supreme Court reported as Central Insurance v. CBR 1993 SCMR 1232. In this case the CBR issued direction for the reopening of Income tax Assessment under section 65 of the Income Tax Ordinance, 1979. It was held by the Supreme Court that the CBR did not figure in the hierarchy of the officer provided in the statute for the purpose of assessment and adjudication. On the basis of this it was held that the directions of the CBR to reopen the assessment was without jurisdiction and the adjudication officer was directed to apply its own mind. Reliance is placed on the order of the Tribunal in S.T. Appeal No. 176/2007 Messrs Muller and Phipps Pakistan (Pvt.) Ltd. v. The Collector of Sales Tax Enforcement LTU, Karachi and 2010 PTD (Trib.) 1787, 2011 PTD (Trib.) 2114 Collector of Customs, Peshawar v. Collector of Customs (Appeals) and another and 2011 PTD (Trib.) 2557 Messrs Wawa Garments Industries (Pvt.) Ltd. v. Additional Collector of Customs (Exports).

(xii)That the order under subsection (3) of Section 193A has to be passed by the respondent No. 2 within 120 days from the date of filing of appeal or within further extended period of 60 days in terms of its proviso upon availability of exceptional circumstances and recording of those after issuance of notice to the tax payer as held by Hon'ble Supreme Court of Pakistan in reported judgment 2009 SCMR 1881, Khalid Mahmood v. Collector of Customs. In the instant case the appeal was filed on 23.11.2012 and the order should have been passed by the respondent No. 2 on or before 23.03.2013. To the contrary he passed order on 12.09.2014 after lapse of 658 days and to cover up the delay he took the plea that the appeal filed by the appellant before him is time barred, irrespective of the fact that the same is without substance as no objection was raised by the office of respondent No. 3 at the time of filing of appeal nor by the respondent No. 1 representative during the course of hearing before the respondents Nos. 1 and 2, resultant, the appeal is deems to be filed within time and has to be decided on merit, rejecting the appeal on the said pretext is without any substance and nullity to law. Hence hold no grounds instead renders the order so passed as well as assessment order passed by respondent without power/jurisdiction , hence void, ab initio and are not enforceable under law as held in the reported judgments 2008 PTD 60 Messrs Super Asia Muhammad Din Sons (Pvt.) Ltd. v. Collector of Sales Tax,. Gujranwala and 2008 PTD 578 Messrs Hanif Strawboard Factory v. Additional Collector (Adjudication) Customs, Sales Tax and Central Excise Gujranwala 2009 PTD 762 Messrs Tanveer Weaving Mills v. Deputy Collector Sales Tax and 4 others and 2009 PTD (Trib.) 1263, Messrs Syed Bhai Lighting Limited, Lahore v. Collector of Sales Tax and Federal Excise, Lahore and 2 others 2009 PTD 1978, Leo Enterprises v. President of Pakistan and others 2010 PTD (Trib.) 1010 Innovative Impex v Collector of Customs, Sales Tax and Federal Excise (Appeal), 2011 PTD (Trib.) 79 Fazal Ellahi v. Additional Collector of Customs, MCC of PaCCS, 2011 PTD (Trib.) 987 Unique Wire Industries v. Additional Collector of Customs, MCC of PaCCS, 2011 PTD (Trib.) 1146 Kaka Traders v. Additional Collector of Post Clearance Audit and 2012 PTD (Trib.) 1650 Pak Electron Ltd. v. Collector of Customs, Lahore and others.

(xiii) That irrespective of the above legal deficiencies, it is appropriate to state that the competent authority defined in section 2(a) of the Customs Act, 1969 correctly passed the assessment order after consulting the data of the import of identical/similar goods under Rule 110 of the period given in Rule 107 (a) of Customs Rules, 2001 in appellant case instead of the impugned much talked about Valuation Ruling which was for "Suit Cases" not "Bags". The Adjudicating Authority consciously made the assessment while not applying the ruling in accordance with the product of the appellant. If for the sake of arguments it is considered for a while that the ruling was not applied correctly as alleged it also hold no grounds as it cannot be applied subsequently after completion of assessment and allow of clearance under sections 80 and 83 of the Customs Act, 1969 read with Rules 438 and 442 of Sub-Chapter III of Chapter XXI of Customs Rules, 2001 as held by High Court of Sindh in its reported judgment 2008 PTD 1968 Messrs Sikander Enterprises v. Central Excise and Sales Tax Tribunal Karachi. Their lordship of the High Court held

"Even otherwise after clearance of the goods and removal of consignment from the Custom Area Customs Authority were functus officio to reopen the case again it had become past and closed transaction---no specific provision has been quoted as to whether appellant had been guilty of offence under subsections (2) and (3) of section 32 of the Customs Act, 1969; it would thus be difficult to observed as to whether appellant has been guilty of mis-declaration"

(xiv) In yet another reported judgment of Lahore High Court 2009 PTD 281 Sunny Traders v. Federation of Pakistan it was held "Valuation Ruling cannot be considered as a valid documents for cancellation of appraised value" and in reported judgment 2009 PTD 467 Messrs S.T. Enterprises v. Federation of Pakistan. Their lordship of High Court, Lahore held in clear and unambiguous terms that "Valuation Ruling are estimate , if the same are not followed at the time of earlier appraisement, it cannot be used against an importer which has already appraised and has been made out of charged by the Customs Authorities. On the basis of valuation ruling the provision of section 32 cannot be invoked and the notices issued are not lawful. Once a consignment is out of charged after due consideration of the relevant fact, it becomes a past and closed transaction. Relying on the above dictum of the Superior Courts the Hon'ble Customs Tribunal allowed several appeal as evident from reported judgments 2011 PTD (Trib.) 2480 Malik Vetro Designi and 25 others v. Collector of Customs (Appeals) and 2012 PTD (Trib) 754 Messrs Naveed Enterprises, Faisalabad v. Collector of Customs (Appeals), Lahore and 2 others.

(xv)That lastly, it is also felt imperative for the appellant to add that the respondents Nos. 2 and 3 committed a grave error while considering the abbreviation H/T as "Hard Type" instead of Hand Trolley. The appellant never ever imported hard type bags or cases either in the instant consignment imported prior to the subject consignment or after. Instead always imported soft type bags/suit cases, which stood substantiated from the GD No. I-HC-174996-200411 against which show cause notice was issued by the Additional Collector (Adjudication) and examination report of the same read as "documents not found inside the container, description soft type trolley cases 94 pcs sets, size: 20, 24, 28 and 32", I/O China quantity 4 pcs/sets x 1 carton check weight 100% found 6930 kgs vide PICT Slip No. 47245 dated 23.04.2011, images attached, although the said examination report clarify the issue beyond any shadow of doubt that the Suit Cases imported by the appellant were soft type again the R&D Section of the Collectorate put an hold on his GD No. I-HC-1834409-260501 after clearance. Consequent to which the R&D staff re-examined the goods and allow the consignment. The examination report of the R&D is reproduced here-in-below:--

CONTAINER NO. GESU-4625515 NO DOCUMENTS FOUND, EXAMINED GOODS ALONG WITH R&D STAFF THE GOODS ARE SOFT TYPE TROLLEY HANDBAGS SIZE: 20", 24", 26" and 29" 04 PCS/SET ART NO. SK-29009-4, SK-29005-4 OF ASSORTED COLOUR, BRAND SPEED ORIGIN CHINA QTY 560 SETS AVG NET WT: 908 KGS/SET 100% GROSS WEIGHT FOUND 5860 KGS VIDE SLIP NO. 176220."

That the Additional Collector (Adjudication) MCC of PaCCS while relying on the examination report held in order-in-original No. 107 of 2012 (01 case) dated 26.05.2012 corresponding to 12 cases of appellant vacated the show cause notice while holding that that "the bags/cases imported by the appellant were soft type trolley bags and the contention of the answering defendant have standing in the eyes of law as against department, who has instituted the case on the basis of assumption. There should be solid grounds and corroborative evidence for conviction which is in the instant case are missing. The charges therefore could not be established." The instant case of the appellant is on the same footing and need the same treatment as per rule of consistency and fairplay.

(xvi) The order passed by the respondents No. 3 shows that it has not been passed with the application of mind and provision of the Act. Instead is a non speaking order and did not conforms to the mandated requirement of S.24-A of the General Clauses Act, 1897 and this stood validated from the fact that no rebuttal on the grounds of appeal, rebuttal/additional arguments and order of the Tribunal in Appeal No. K-695/13 has been given instead on personal absurd opinion contrary to law and that too also is not containing substantial reasons and did not shows it was passed on objective consideration. Such type of orders are deems to be always treated as illegal, void arbitrary and a result of misuse of authority vested in public functionary. No room was available for such illegal, void and arbitrarily order in any system of law. If any authority Court or Tribunal gave a finding of fact which was not based on material available on record was illegal arbitrarily without discussing and considering the material available on record it became perverse and a perverse finding of fact which is violative of the established principle of appreciation of evidence on record was not sustainable in law. The principle that every judicial or quasi-judicial finding should be based on reasons containing the justification for the finding in the order itself is an established principle of dispensation of justice. The Adjudication/Appellate orders are being violation of basic principle of the goods governance and mandatory requirement of Section 24A of the General Clauses Act, is not only illegal and void but also not sustainable under law. The said position is also fortified by the judgments of Superior Courts reported as 2005 YLR 1019, 2007 PTD 2500, 2004 PTD 1973, 2005 YLR 1719, 2003 PTD 777, 2003 PTD (Trib) 2369, 2002 MLD 357, 1983 CLC 2882, 2005 PTD 2519, 2005 PTD 1189, 2003 PTD 2369 and PLD 1995 SC (Pak) 272, PLD 1970 SC 158, PLD 1970 SC 173, 1984 SCMR 1014 and 2012 PTD (Trib.) 619.

(xvii) The appellant carves his right to add any fresh grounds at the time of hearing beside placing any valid incriminating evidence/document.

5.No cross objection under subsection (4) of Section 194A has been filed within the period specified therein by either of the respondent, however on the date of hearing Mr. Faiz Mudassir Appraiser in the capacity of representative of respondent No. 1 stated that the order passed by respondent No. 3 is correct in fact and law and should be maintain and the appeal of the appellant be rejected as non maintainable. Mr. Kosar Hussain in the capacity of representative of respondent No. 2 adopted the arguments of Mr. Faiz Mudassir.

6.Rival parties heard case record perused.

7.Prior to dilating upon the merit of the case, it is advantageous to decide the issue of time barred of the appeal filed before respondent No. 3. Upon perusal of the memo of appeal filed with respondent No. 3 and is available as Annex J1 at pages 35 to 42 of appeal book, it has been observed that no objection in this regards has been inscribed by the office of respondent No. 3, hence the filed appeal before him deems to be and within time. Therefore, the respondent No. 3 was having no reason to form opinion regarding limitation. Beside it is also observed that the order was not served on the appellant as per the expression of Section 215 of the Customs Act, 1969. Instead upon receipt of letter dated 07.11.2012 of the consultant of the appellant, the order was hand delivered to the representative of the appellant on the same date i.e. 07.11.2012, resultant was served on the appellant in terms of section 215 of the Customs Act, 1969 and the dictum laid down by the Superior Judicial fora referred by the appellant in para 4(ii) supra. Consequent to that appeal was filed by the appellant with the respondent No. 3 on 23.11.2012 i.e. within 30 days from the date of service of order and was within time and the said fact has not been controverted by either of the respondent representative during the course of hearing nor any tangible evidence in support of the opinion of the respondent No. 3 was placed on record. This laid to rest the observation of time barred. Notwithstanding, the appeal before the Tribunal is filed within time and as such has to be decided on merit instead of technicalities.

8.That upon perusal of Section 228 of the Income Tax Ordinance, 2001, I found that the respondent No. 1 has not been appointed/ designated as Officer of Inland Revenue by the legislature for overseeing the collection of withholding Tax by the authorized agents, the Directorate General of Withholding Taxes has been established under Section 230A of the Income Tax Ordinance, 2001. This contemplate that the respondent No. 1 is not at all appointed/designated as Officer of Inland Revenue. Therefore is not empowered under Section 207 ibid to exercise the powers to conduct audit under Section 177 ibid for the collected of Income Tax at import stage. Rendering the entire Act of audit and subsequent proceeding by the official of respondent No. 1 without powers/jurisdiction and as such coram non judice and this stood validated from the latest reported judgment 2014 PTD 1733 Waseem Ahmed and others v. FOP and another, where it has been held in clear terms that "unless the officer of DGI&I FBR are not appointed and an officer of Inland Revenue, powers under the different subsection of the Sales Tax Act, 1990 can not be delegated through any S.R.O. with that the Hon'ble High Court of Sindh declared Notification No. 775(I)/2011 ultra vires to the Sales Tax Act, 1990".

9.That the officials of respondent No. 1 are indeed appointed as Officer of Inland Revenue under Section 30DD of the Sales Tax Act, 1990 and Board has delegated powers to them under Notification No. 42(I)/2010 for exercising under different subsection of the Act, specified in column (4) of notification. But those vested power has to be exercised by the authorities given in column (3), which are (i) Chief Commissioner/Commissioner Inland Revenue (ii) Additional Commissioner of Inland Revenue (ii) Deputy Commissioner Inland Revenue and (iv) Assistant Commissioner Inland Revenue and not in the capacity or designation of (i) Director General/Director-PCA (ii) Additional Director-PCA (iii) Deputy Director -PCA & (iv) Assistant Director-PCA. In the instant case the entire communication including the audit observation and contravention report was prepared and served in the capacity of Deputy Director of PCA, which is non existent in column No. (3) of Notification No. 42(I)/2010 dated 23.01.2010, rendering the act and commission and the audit observation dated 20.06.2011 without power/jurisdiction. Hence ab-initio void and so the contravention report and subsequent proceeding as of no legal effect. Any super structure built thereon no matter how strong it may be had to fall as held by Superior Judicial Fora in umpteenth reported judgment and the citation given by the appellant in para 5(3) supra are fully applicable with force on the case of the appellant.

10.On examination of the show cause notice, it has been noticed that the Adjudicating Authority (respondent No. 2) has invoked Section 36 of the Sales Tax Act, 1990 and Section 148 of the Income Tax Ordinance, 2001. The Consultant/Advocate of the appellant have strongly contended that he has not been appointed as Officer of Inland Revenue under Section 30 of the Sales Tax Act, 1990 and Section 228 of the Income Tax Ordinance, 2001. Therefore, has no powers to proceed in the matter of Sales Tax and Income Tax under the invoked sections for recovery of short collected/paid taxes. On the other hand the respondents are of the opinion that the customs is empowered to collect the Sales Tax and Income Tax at import stage under Section 6 of the Sales Tax Act, 1990 and Section 148 of the Income Tax Ordinance, 2001 and can also recover those under the provision of Section 202 of the Customs Act, 1969.

11.On meticulous and analytical examination of the expressions of Section 30 of Sales Tax Act, 1990 and Section 207 of the Income Tax Ordinance, 2001, it is observed that the legislature appoints under the said sections different organ of the FBR as Officer of Inland Revenue for exercising powers under the respective Sections of the Act/Ordinance, delegated through notifications. In these Sections neither Collectorate of Customs PaCCS nor respondent No. 2 figures anywhere, confirming with clarity that they are not appointed as Officer of Inland Revenue, hence cannot lay hands on any matter falling under the ambit of section 36 of the Sales Tax Act, 1990 and section 162(1) of the Income Tax Ordinance, 2001.

12.To further elaborate and settling the issue to its logical conclusion, I subscribe that Section 6 of the Sales Tax Act, 1990 and 148 of the Income Tax Ordinance, 2001 empowers the respondent Collectorate to collect the Taxes on the imported goods as like custom duty on the value determined under section 25 of the Customs Act, 1969. However, these section least empowers the Officers of Customs including the respondent No. 2 to initiate adjudication/recovery proceeding for the short collected/paid Sales Tax and Income Tax either due to collusion or connivance or inadvertent, error or misconstruction. For proceeding for these type of recovery a show cause notice has to be issued under the Provision of Section 36 of the Sales Tax Act, 1990 and Section 162(1) of the Income Tax Ordinance, 2001, the authority to issue show cause notice under subsection (3) of Section 36 of the Sales Tax Act, 1990 and Section 162(1) of the Income Tax Ordinance, 2001 are Officer of Inland Revenue and the Commissioner of Income Tax , in these sections also neither officer of Customs and respondent No. 2 figures anywhere. He assumed the power not vested with under the provision of Sections 36 and 162(1) of the Sales Tax Act, 1990 and Income Tax Ordinance, 2001. Therefore, I am of the considered opinion that the Customs Collectorates have powers to collect Sales Tax and Income Tax at import stage not post importation and the plea that customs is empowered to recover the short paid amount at the import stage under section 202 of the Customs Act, 1969 is based on mistaken belief. The Customs Collectorate could recover the amount of Sales Tax and Income Tax on behalf of Inland Revenue upon receipt of notice from the Officer of Sales Tax and Commissioner of Income Tax under Section 48 Sales Tax Act, 1990 and Section 140 of the Income Tax Ordinance for recovery of the adjudged amount of taxes by them after due process of law.

13.On the strength of above deliberation, it is my considered opinion that the Customs Collectorates does have the authority to collect Sales Tax and Income Tax at import stage in the capacity of collecting agent and recover under Section 202 of the Customs Act, 1969 escaped/short paid Custom Duty and Regulatory Duty levied on the imported goods under Section 18 ibid, after due process of law and upon attaining finality of the order after crossing of all legal forum set forth in the Act where it could be challenged and each proceeding threw open previous orders and appellate authority constitute a continuation of proceeding and finding of the last forum shall be final and binding and conclusive. Reliance is placed on the judgment of Hon'ble-Supreme Court of Pakistan in the case of CBR v. Chanda Motors reported at 1993 SCMR 39. However, they have no powers to adjudicate the cases of short recovery of Sales Tax and Income Tax under sections 36 and 162(1) ibid of the Act/Ordinance respectively. Neither Customs Collectorate nor respondent No. 2 have the powers to recover the arrears of these Taxes at their own, unless they are in receipt of notice from the Officer of Inland Revenue and Commissioner of Income Tax under sections 48 and 140 ibid. Resultant adjudication proceeding under Section 36 of the Sales Tax, 1990 and Section 148 of the Income Tax Ordinance, 2001 (as mentioned in the Show Cause notice) is not legal, justifiable and tenable in the eyes of the law and inconsonance with the orders passed by this Tribunal and higher judicial fora, in the matter of jurisdiction e.g. order in Customs Appeal No. K-903/2011 Messrs Moon Enterprises v. Collector of Customs MCC (PaCCS) and others K-236 - 270/2012 M/s. Fort Tiles v. Additional Collector of Customs, MCC of PaCCS and another 2014 PTD (Trib.) 299, Messrs M.I. Traders, Lahore v. Additional Collector, MCC of PMBQ, Karachi and to the order of Hon'ble High Court of Islamabad in Customs Reference No. 01/2010 Collector of Customs, Rawalpindi v. Global Marketing and Services etc. through which order of the Tribunal in Customs Appeal No. 187/CU/IB/2008 dated 31.07.2009 on the said issue was maintained. Likewise, the Hon'ble High Court of Sindh in Petition C.P. No.D-216/ 2013 of Messrs Lucky Cement Ltd Karachi v. Federation of Pakistan and others, observed and held in categorical terms that:--

"The word emphasized could be regarded as being in the nature of deeming provisions. If so, then (subject to the rules of interpretation that apply in such a situation) that nature of sales tax or excise duty on imports, for purpose of levy, charge or collection (as the case may be), may be regarded as a customs duty. Clearly, this would be a materially different situation than that which obtains in relation to advance income tax on imports. In our view, the jurisdiction of the customs authorities (i.e. the Collector of Customs) is limited to only the collection of the advance income tax. Furthermore, subsection (6) of section 148 emphasizes that provisions of the Customs Act apply only to the Collection of the tax and that too, only in so far as is relevant. Since there is a clear distinction between the collection of a tax on the one hand and its recovery or enforcement on the other, in our view, the provision of the Customs Act as relate to the latter are not applicable in relation to the jurisdiction conferred on the Customs Authorities under section 148."

It has been held in another judgment of Hon'ble Lahore High Court, Lahore 2008 PTD 1973 titled as Xen Shahpur Division v. Collector of Sales Tax (Appeal), Collectorate of Customs, Federal Excise and Sales Tax, Faisalabad--

"That fiscal law is to be applied with full authority and its natural meaning-one has to look merely at what is clearly said and there is no room for any intendment---neither there is equity about a tax nor presumptions as to tax---nothing is to be read in, nothing is to be implied -- one can only look fairly at the language used"

In the light of law laid down I hold that the exercise of jurisdiction on this point by the respondents Nos. 2 and 3 in addition to adoption of recovery proceeding by them are declared as ab initio void and as such coram non-judice.

14.The Directorate General of Valuation has been delegated powers under Notification No. 495(I)/2007 dated 09.06.2007 read with para 44 of CGO 12/2002 dated 15.06.2002 to adjudicate the cases falling under sections 25, 25A and 32 of the Customs Act, 1969 and to initiate action for recovery of Government dues thereafter under Section 202 of the Customs Act, 1969 read with Recovery Rules embodied in Customs Rules, 2001. In the said Notification and para the respondent No.2 also figures no where. By laying hands on the matter relating to Sections 25 and 25A of the Customs Act, 1969 and issuance of order for recovery under section 202 of the Customs Act, 1969, the respondent No. 2 also encroached the specific notified territory of Directorate General of Valuation. Rendering the order passed by him and the subsequent order passed by respondent No.3 without power/jurisdiction and lawful authority. Hence, ab initio, null and void and this stood validated from the judgment reported at PLD 1971 SC 184, PLD 1971 Supreme Court 197, PLD 1973 Supreme Court 236, PLD 1976 Supreme Court 514, 1992 ALD 449(1) Karachi, 2004 PTD 624, 2006 PTD 2237, 2009 PTD (Trib.) 1926 and 2010 PTD (Trib.) 832, PLD 2004 Supreme Court 600, PLD 2005 Supreme Court 842 and 2014 PTD 199.

15.The appeal before the respondent No. 3 was filed on 23.11.2012 and an order under the proviso of subsection (3) of Section 193A of the Customs Act, 1969 should had been passed within 120 days from the date of filing of appeal i.e. on or before 23.03.2013 or within a further extended period of 60 days during the initial period of 120 days with reason to be recorded for extension in writing after serving a notice to the person concerned as per law laid down by the Hon'ble Supreme Court of Pakistan in reported judgment 2009 SCMR 1881 Khalid Mehmood v. Collector of Customs. No extension was granted by the respondent No. 3 prior to the expiry of initial period of 120 days and this is evident from order which is completely silent in this regard. He passed the order after 778 days from the date of filing of appeal, therefore hopelessly barred by time by 658 days. Therefore, without powers/jurisdiction and cannot be enforced under law as held in reported judgments 2008 PTD 60, 2008 PTD 578, 2009 PTD 762, 2009 PTD (Trib.) 1263, 2012 PTD (Trib.) 1650, 2010 PTD (Trib.) 1010, 2011 PTD (Trib.) 79, 2011 PTD (Trib.) 987, 2011 PTD (Trib.) 1146, 2009 PTD 1978.

16.I am also amazed to note that the appellant has been charged for declaration under the provision of Section 32 of the Customs Act, 1969 on the basis of the allegation of non application of valuation ruling, which infact has not to be applied by the appellant instead it is mandated upon the appropriate authority defined in Section 2(a) of the Customs Act, 1969 to pass assessment order under Section 80 of the Customs Act, 1969 and Rule 438 of Sub-Chapter (III) of Chapter XXI of Customs Rules, 2001 while exercising powers delegated upon him through Notification No. 371(I)/2002 dated 15.06.2002 on the valuation ruling. The application of valuation ruling does not at all attract section 32 of the Customs Act, 1969 as it is not a documents which is said to be a declaration by the appellant and due to the said fact no column is available in the prescribed GD to be filed by an importer online for obtaining clearance of the goods, rendering the charge of misdeclaration under section 32 as of no substance and legal effect. The valuation ruling issued by the Director, Directorate General of Valuation under section 25A of the Customs Act, 1969 is for the purpose of assessment not for charging importer for misdeclaration of value. Charge of misdeclaration of value has to be leveled on the basis of direct evidence as ordered in para 78 and sub-para (3) of para 101 of CGO 12/2002 and clause (d) of Notification No. 499(I)/2009 dated 13.06.2009 and this has been held by this Tribunal in reported judgment 2014 PTD (Trib.) 1190 Messrs Shoaib Tayyab International v. Additional Collector of Custom Adjudication-II and which has attain finality as no reference has been filed against the said order before the Hon'ble High Court of Sindh under section 196 of the Customs Act, 1969, instead implemented in letter and spirit.

17.Notwithstanding, I am deeply concerned to note that the respondent had erroneously termed the abbreviation H/T which is for "Hand Trolly" as of "hard type suit cases" for which director, directorate General of Valuation issued valuation ruling No. 297 dated 12.03.2011 and is applicable exclusively on the imported hard type suit cases, not bags imported by the appellant. The respondent also intentionally also ignored the Order-in-Original No. 107 of 2012 dated 26.05.2012 passed by the adjudicating authority in favour of the appellant in similar nature of case, where it has been held that the imported goods of the appellant were soft type of trolly bags not suit cases. The said order attain finality due to non filing of appeal. It is settled proposition of law that if the valuation ruling have not been applied at the time of assessment under section 80 of the Customs Act, 1969 and Rule 438 of Sub-Chapter III of Chapter XXI of Custom Rules, 2001, it cannot be applied subsequently after clearance of the goods under section 83 of the Customs Act, 1969 and Rule 442 of Sub-Chapter (III) of Chapter XXI of the Customs Rules, 2001 by the competent authority enunciated in Section 83 and Notification No. 371(I)/2002 dated 15.06.2002. This Tribunal had issued countless decisions on the said issue and the orders passed by the lower forum were set aside and appeals were allowed. Instead of referring to the observations made therein by the Tribunal, it is appropriate to refer to the judgment of High Court of Sindh reported at PTCL 2009 CL 330 Messrs S.T Enterprises v. FOP, wherein their lordship held that "Valuation Ruling are estimate if the same are not followed at the time of earlier appraisement, it cannot be used against an importer which has already appraised and has been made out of charge by the Customs Authorities. On the basis of valuation ruling the provision of section 32 cannot be invoked and the notices issued are not lawful. Once a consignment is out of charged after due consideration of the relevant fact, it becomes past and closed transaction" and to the 2008 PTD 1968 Messrs Sikander Enterprises v. Central Excise and Sales Tax Tribunal Karachi holding that:

"Even otherwise after clearance of the goods and removal of consignment from the Custom Area" Customs Authority were functus officio to reopen the case again when it had become past and closed transaction---no specific provision has been quoted as to whether appellant had been guilty of offence under subsections (2) and (3) of section 32 of the Customs Act, 1969; it would thus be difficult to observed as to whether appellant has been guilty of misdeclaration"

18.I therefore hold in categorical terms that if some one has to be charged for non application of Valuation Ruling. It is the officer of custom who passed the assessment order under section 80 of the Customs Act, 1969 and Rule 438 of Customs Rules, 2001, while ignoring the infield valuation ruling not the appellant, who has been dragged needlessly in the litigation proceeding despite not warranted in the given narrated facts of the case and law.

19.I am also spell bound from the standard of order passed by respondent No. 3, which itself confirms that it has not been passed with the application of mind and in accordance with the spirit of the provision of the Act, and even in defiance of direction of the Board issued vide No. Dy-730-M(L)/2002 dated 15.06.2002. Sub-para (vii) of para 2 orders the Quasi Judicial Authorities to "pass a speaking order giving reason in support of his conclusions. Each plea/arguments advanced by the person should be brought out in the order and if not admitted it should be rejected with reasoning it should not be left to the person concern or to the Appellate Forum to search for the reason and to speculate what induced the appellate forum to come to a different conclusion and in sub-para (viii) read that "the judgment always speaks about their authors. The judgment passed must reflect professionalism, fairness, neutrality, reasonableness, clarity and justice. The FBR subsequently renewed the direction vide letter C.No. 1(1)SPS-M(L)2014 dated 05.09.2014 with the caption "Administration of justice by the quasi judicial authority guideline regarding", para 2(a) of which is:

"A qausi judicial is a formal expression of adjudication and it should be one which ought not to be left open to what is exactly adjudicated upon. The part of the order dealing with the decision of the action should contain the brief fact and contention of the parties from which the fact in issue or point of disagreement are necessarily to be evolved which need to be determined by the adjudicating authority. The Adjudicating Authority must evaluate these facts in issue by making a discussion of evidence produced by the party. The order must contain real point of determination and decisions thereon. The discretion which the rules give required to be judicially exercised. Make sure that no material consideration have been overlooked. The adjudicating officers should apply their mind to the facts of the case and point out issue and give a well reasoned order thereon satisfying legal requirement that all evidence has been evaluated and rival contention and arguments duly considered section 24A of the General Clauses Act, 1897 provide necessary and mandatory guidance on fair and just exercise of powers and passing a speaking order, which needs to be followed under all circumstances."

The direction of the Board and mandated requirement of The General Clauses Act, 1897 as to be adhered in terms of Section 223 of the Customs Act, 1969 and the principle of natural justice, fair play and ratio decidendi. To the contrary the Respondent No.3 intentionally and purposely has not rebutted a single ground of the Appeal No. 4339/2012/PaCCS filed before him by the appellant and had passed a very sketchy, slip shot, vague, cursory and non speaking order, confirming that it has been passed not on objective consideration rather on personal whims and wishes and inapt interpretation of the Provision of the Act. Such type of order are termed by the superior judicial Fora as illegal, void, arbitrary and as a result of misuse of authority vested with. No room was available with the Respondent No. 3 to pass such illegal, void and arbitrary order as it is a settled dictum of the Superior Judicial fora that if any Authority, Court or Tribunal gave a finding of fact which was not based on material available on record, the findings so given is illegal and arbitrary and became perverse and a perverse finding of fact is violative of the established principle of appreciation of evidence of record and as such not sustainable in law. The principle laid down by the Board and the Superior Judicial Fora is that, that every Judicial/ Quasi Judicial order should be based on a reasoning containing the justification for the finding given in the order because in the absence of the same the order so issued is in derogation of established principle of the dispensation of Justice, hence it is in derogation of the direction of the Board and mandatory requirement of Section 24A of the General Clauses Act, 1897. Therefore, it is not only illegal and void but also fails the test of Judicial scrutiny and as such not sustainable in the eyes of law and this has been held by the Superior Judicial Fora in countless reported judgment referred in Para 4(x) Supra and which are squarely applicable on the case of the appellant.

20.In view of the above discussion, the order passed by the hierarchy below suffers from inherent legal deficiency/infirmity and are therefore declared void and ab initio and hereby set aside and appeal is allowed with no order to cost.

21.Announced accordingly.

RR/55/Tax(Trib.)Appeal accepted.