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Petitioner: Messrs Tagers, Karachi VS Respondent: The Deputy Collector of Customs and anothers
Court Name: Customs Appellate Tribunal Judge(s): Jehanzaib Wahlah Title: Messrs Tagers, Karachi vs The Deputy Collector of Customs and anothers Case No.: Custom Appeal No. K-939 of 2016 Date of Judgment:2019-04-08 Reported As: 2020 PTD (Trib.) 1359 Result: Appeal allowed
JUDGMENT
JUDGMENT JEHANZAIB WAHLAH, MEMBER JUDICIAL-III.----Through this order, I intend to dispose off Appeal No. K- 939/2016 directed against the Order-in-Appeal No.127/2016 dated 23.02.2016 passed by Collector of Customs (Appeals), Karachi. 2. Briefly fact of the case are that the appellant imported a consignment of 10240 kgs of transparent plastic empty boxes with lid in assorted sizes @ US $ 0.80/kg, upon receipt of shipping documents appellant transmitted Goods Declaration (GD) under Section 79(I) of the Customs Act, 1969 and Rule 433 of Sub-Chapter III of Chapter XXI of the Customs Rules, 2001 and as per pre-requisite for availing the regime of Customs Computerized System deposited upfront duty and taxes vide cash No.C-KCSI-000370-02012013 with the NBP, consequent to which the GD was numbered as KCSI-HC-87302-02012013. The consignment was thereafter, selected for conduction of examination under 198 and Rule 435 of the Act/Rules, wherein declaration was confirmed to the extent of all aspects, report so prepared was uploaded in the reservoir of GD. Upon receipt of which the assessing officer passed assessment order dated 07.01.2013 under the provision of Section 80 and Rule 438, while doing so he changed the PCT heading as 3924.9000 as against declared 3923.1000 and with the application of Valuation Ruling, No.274/2010 ibid. Being aggrieved appellant filed first review under Rule 441 before the Principal Appraiser, who upheld the consequent to which second review was filed before respondent No.1, who accepted the contention of the appellant and passed assessment order under the aforesaid of the provision of the Act/Rule i.e. accepting the declaration in regards to PCT heading and value, consequent to which the inbuilt authority of the CCS passed clearance order under the provision of section 83 and Rule 442 ibid, the appellant accordingly obtained the delivery from the terminal on 07.11.2015, when appellant logged CCS, he was confronted with the view message popping on his home page for payment of Rs.309,033/-
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towards duty and taxes and penalty of Rs.115,640/- for late payment (total of which comes to Rs.424,673/-) the message appearing on the home page was in the format reproduced here-in-under: GD#:: KCSI-HC-87302- 02.01.2013 Trader: TagersVIR# :KAR-0730- 21122012 Available balance in correspondent PD Account of the Collectorate. B/L # KHIGP12120079-01 Payment Breakup 100 Duty Name Amount in Rs. Additional Sales Tax 21,908 Custom duty 121,715 Income Tax 43,452 Sales tax 116,846 Cess 5,112 Late Payment Penalty 115,640 Total Payment amount in Pak Rs.424,673 Since, the said view message by all mean a demand notice under the provision of section 202 of the Act and that also in isolation, without crystallization of the demand of short paid amount through a valid order after due process of law, appellant prefer appeal before respondent No.2 on the strength of the view message, the respondent No.2 without touching the merit of the case, rejected the appeal summarily by terming the same as barred by time. The relevant para is reproduced as under: "3- I have examined the case record. The appellant goods were finally assessed on 08.02.2013, as per assessment note retrieved from the system. There is no further change in the assessment seen in the notes. The appellant's have filed this appeal on the basis of computer print GD taken after a time of two years and nine months. The departmental Representative stated that they have not issued any fresh assessment order or view message for recovery. The impugned GD was assessed two year ago. The departmental representative also deny the generation or issuance of the impugned print out. I, therefore, hold that appeal after a huge time lag is not entertainable The documents presented by appellant is not a re-assessment order or even an order under Section 80 of the Customs Act, 1969. Therefore no appeal lies against the same under Section 193 of the Customs Act, 1969. The appellant's are not aggrieved person, the appeal is not sustainable, therefore dismissed." 3. The appellant filed the appeal on the basis of grounds enumerated therein, the consultant on the date of hearing argued the case strictly in accordance with those. No cross objection under subsection 4 of Section 194A of the Act has been filed within the stipulated period of 30 days or not even to date by the respondent No. 1 . However, the representative of the respondent No. 1 vehemently defended the passed reassessment order and appeal by respondents and prayed for maintenance of those, irrespective of apparent deficiencies /illegality. 4. Rival parties heard and case records perused and so the relied upon citations, on the strength of which following issues are framed for decision: (i) Whether appeal filed before respondent No.2 by the appellant on the strength of GD containing assessment order under Section 80 and Rule 438 of the Act/Rules and view message showing amount of duty and taxes to be paid by the appellant in addition to penalty on late payment are deems to be in order, for filing appeal under the provision of Section 193 of the Act and appellant was competent to assail the vires of those before respondent No.2?
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(ii) Whether respondent No. 2 was in his right to reject it on the basis of limitation, without evaluating the circumstances in which reassessment order was passed for creating recovery in isolation by the authority not empowered under the provision of Section 32(3) of the Act and Serial No. 3(ii) of SRO 371(1)/2002 dated 15.06.2002? (iii) Whether respondent No. 1 is empowered to reassess the GD under Section 80(3) of the Act, in derogation of the expression of Section 3DD ibid, SRO No.500(I)/2009 dated 13.06.2009 and Section 193 ibid? (iv) Whether reassessment by respondent No.1 was made strictly as per the spirit of Sections 80(2) and (3) of the Act? (v) Whether recovery can be created in isolation through a view message without issuance of show-cause notice despite of clear expression enunciated in Section 132(3) of the Act and whether respondent No.1 was empowered in passing order for creating recovery under section 32(3) of the Act to be read with Serial No. 3(ii) of SRO No. 371(1)/2002 dated 15.06.2002? (vi) Whether respondent No.1 was empowered to amend the GD under Section 205 despite bar laid in Section 29 of the Act after out of charge of the goods and delivery of those to the appellant? (vii) Whether the respondent No.1 was empowered to create recovery of Sales Tax and Income Tax under Section 11 of the Sales Tax Act, 1990 and Section 162(1) of the Income Tax Ordinance, 2001? 5. As regard to issue No.(i), Upon perusal of the order passed by respondent No.2 it has been observed that he rejected the appeal on the basis of formed opinion that respondent No.1 has not passed any reassessment order after out of charge of the goods, instead the order passed on 08.02.2013 was in fact an assessment order under Section 80(3) prior to passing of clearance order under the provision of Section 83 and. Rule 442 on the strength of assessment order under the provision of Section 80(1) and Rule 438 of the Act/Rules by respondent No. 1 and appeal before him was preferred by the appellant on the basis of GD and view message is not valid/competent as per the contemplation of Section 193(1) ibid., and on the denial of the representative of respondent No.1 that no view message either for payment of any amount of duty and taxes and penalty was generated and posted on the home page of the appellant. For reaching at a just decision, the representative of respondent No. 1 was asked to supply the assessment sheet/note of the consignment in question, inclusive of log sheet and confirmation to the effect that when the consignment was out of charged after passing clearance order under the provision of Section 83 and Rule 442 of the Act, which were supplied, upon examination of the assessment sheet is transpired that 1st assessment was done by the assessing officer on 07.01.2013 through which he changed the PCT and applied valuation ruling for levy of duty and taxes, evident from adduced remarks reading as "3924.9000 / plastic house hold items/ware/S.No.25-A 274/06.10.2010/China/3.42 VR goods are Malaysia origin". The said assessment was challenged before Principal Appraiser through review in terms of Rule 441 of the Rules, who rejected that while adducing remarks dated 09.01.2013 "upheld", against which appellant filed 2nd review before respondent No.1, who accepted the contention of the appellant in regards for PCT Heading and value and modified the assessment order on 09.01.2013 while inscribing Review vide KCSI/HC-64395-15.11.2012", consequent to which appellant obtained the delivery from the terminal Subsequently, on 08.02.2013 respondent No.1 amended columns 44, 45 and 47 of the GD i.e. US $ 14,336/-, Rs.1,420,005/- and Rs.709150/- as against appearing in GD US$ 8192/-, Rs.81132/- and Rs.405,229/- respectively, through reassessment order under the provision of Section 80(3) of the Act, while subscribing in the note sheet "As per criteria and instruction of Collector MCC PaCCS regarding subject item" On the strength of which posted view message for payment of Rs.424,673/- i.e. Rs.309,033/- towards duty and taxes and Rs.115,640/- towards penalty for late payment on the home page of the appellant. The question arise that whether view message falls under the ambit of order, definition available in Black Law Dictionary Sixth Edition was perused, which says that an order means "command, direction or instruction". Whereas, the word order has been defined in PLD 1986 Lah. 237 as ".....the word 'order' is not being a term of art has no fixed legal meaning. According to Prem's Judicial Dictionary, it covers commands or directions that something shall be done....the term order in general is comprehensive enough to include all kinds of order including a formal order." The examination of the view message confirms that it contains command and direction for the appellant for
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payment of duty and taxes and penalty for late payment, despite being formal. Therefore, it is by all means falls within the definition of an order and vires of the same could be challenged before respondent No.2 under the provision of Section 193(1) of the Act without any exception. Hence, appeal was validly filed by the appellant before the respondent No.2 for decision strictly in accordance with its expression of Section 193(1) reading as "any person including an officer of customs aggrieved by any decision or order passed under Sections 33, 79, 80 and 179 by an officer of Customs, below the rank of Additional Collector may prefer appeal to the Collector (Appeal). Whereas, for confirmation of the veracity of the statement made by the representative of respondent No.1 before the respondent No.2 that no view message was prepared/posted on the home page of appellant for generating recovery against the appellant, he was confronted that if the same was not generated or posted, from where it was obtained by the appellant, he was completely mum and has no answer, conversely the consultant of the appellant validated the veracity of the view message by submitting multiple view messages posted by respondent No. 1 on his home page to date i.e. on 18.03.2016, 02.06.2016, 15.06.2016, 22.08.2016, 21.10.2016, 25.11.2016 and 03.01.2018, wherein the amount of duty and taxes remained the same with the exception of penalty for late payment which increased gradually in view message i.e. Rs.131,027/-, Rs.139,887/-, Rs.143,034/-, Rs.149,329/-, Rs.156324/-, Rs.160,404/- and Rs.250,048/- as against view message dated 07.11.2015 Rs.115,640/-. These left the representative of the respondents speechless. Therefore, I am led to conclude in unequivocal terms that view message on the strength of which instant appeal was filed by the appellant before the respondent No.2 was prepared /generated and posted on the home page of the appellant by respondent No.1 akin to the view messages generated/posted subsequently on the dates referred here-in-above by the respondent No. 1. The issue No. (i) is answered in affirmative. 6. As regard to issue No. (ii), the clearance of the consignment in the instant case has been made under the regime of CCS by the competent authority defined in Section 2(a) of the Act after passing of valid/legal appealable assessment/clearance order in exercise of the powers vested upon him through SRO 371(1)/2002 dated 15.06.2002 , under the provision of Sections 80 and 83 and Rules 438 and 442 of the Act/Rules, consequent to which the appellant obtained delivery from the terminal. Any correspondence under the said regime has to be transmitted online without any exception. In case of contravention or short payment, even show cause is transmitted online and reply to that is pasted by the importer in the space allotted in the said module as "Trader Reply" and order so passed by the adjudicating authority is also transmitted online in consonance with the Section 155Q and Rule 546 of the Act/Rules prior to passing of clearance order. However, in case any contravention is framed after clearance on the strength of audit of the record of the importer by the Directorate General of Post Clearance Audit (DGPCA) or by any other allied department of the FBR, contravention report and connected show cause notice and order-in-original are issued/passed by the competent authorities manually as the software of CCS lacks the such facility after clearance of the goods. The importers (appellant) invariably log in software of CCS, when they/he imports consignments and transmit GD for home consumption under the provision of Section 79(1) and Rule 433 of the Act/Rules and keep tracking the status of the GD for payment of additional duty and taxes if any after passing of assessment order under Section 80 and Rule 438 and subsequently passing of clearance order by the defined authority under the provision of Section 83 and Rule 442 of the Act/Rules. Thereafter seldom log in for knowing or having information of the already cleared consignments, being passed and closed transaction if in any case the logged in and saw message popping on their home page corresponding to the already cleared consignment. Importers invariably ignore those as the goods had already been cleared and no clearance had to be obtained by him, hence payment of duty and taxes least exist. Instead of completing assessment vigilantly at the time when the goods were at the terminal and under clearance, the Officer of Customs/respondent No.1 have made a habit to reassess the GDs at the back of the importer/appellants for creating recovery and they keep those as guarded secret, till the time the importer/appellant transmit GD with the Collectorate against their consignment arrived at the terminals and then pressurized them to pay the recovery created by them in isolation, then the importer/appellant came to know about the same and files appeal after retrieving the reassessment order before the respondent No.2. Although the entire exercise carried out by the Officer of Customs and the respondent
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No.1 is without lawful authority and as such of no legal effect. It was mandated upon him to intimate in regards to passing of reassessment order and creating of recovery manually in accordance with the adopted procedure of framing contravention report and issuance/passing of show-cause notices/order-in-original after clearance of the goods through CCS regime as enunciated in Section 215 of the Act that Service of Order, decision, etc. shall be served (a) "by tendering the order, decision, summon or notice or by sending vide registered post or the courier service or by any other mode of transmission subject to acknowledgment receipt to the person for whom it is intended or to his agent or (b) if the order, decision, summon or notice cannot be served in any manner provided in clause (a), by affixing it on the notice board of the Custom House", for making the service good/valid and enabling the importers / appellant to avail the remedy under the provision of Section 193 or 194A of the Act. To the contrary, the aim of the Officers of Customs including Respondent No.1 keeps the importers/appellant in dark, for snatching the right of appeal and making the created recovery good/valid, despite having no warrant of law. 7. Upon perusal of the view message dated 07.11.2015, I have observed that despite mandated under law, and as per the contemplation of Sections 155Q and 215 of the Act ordered/commanded the appellant to pay an, amount of Rs.309,033/- towards duty and taxes along with penalty for late payment amounting to Rs.115640/- against the GD, goods of which has already been out of charge on 09.01.2013. The appellant upon having knowledge retrieved that and challenged the vires of that before respondent No.2, which was acknowledged on 17.11.2015 for regular hearing without any objection of even time barred evident .from the affixed stamp on the memo. of appeal. Hence, it was mandated upon respondent No.2 to decide the appeal on merit. The said act of his would had been just and in consonance with the Article 10A (Fair Trial) of the Constitution of Islamic Republic of Pakistan. Even otherwise, it is principal of law that Appellate Authority have to examine the reason for delay sympathetically when admittedly registered person was proceeded ex parte during the adjudication proceeding, as. held by ITAPTP in reported judgment 2010 PTD (Trib.) 1491, the case of the appellant is on the same footing as reassessment order was passed by respondent No.1 ex parte and in isolation without adherence of due process of law. Likewise in 2010 PTD (Trib.) 1359 it has been held that "Collector was bound to have condoned such delay for the sake of justice and fair play" and in 2012 PTD (Trib.) 637, it has been held that " the rules of procedure are enacted for fostering the ends of justice and preserving the rights rather than to stifle the dispensation of justice and, unless they are un-surmountable; ends of justice always out way the manner of practice and procedure". In the same judgment further held that "there is no doubt that the appeal filed before the First Appellate Forum was time barred by 127 days yet the higher Court has repeatedly held that the cases should be decided on merit instead on technical grounds and technicalities of law and fact should always be avoided and discouraged in order to do complete justice and to ensure that justice is not only done but also seen to have been done". The respondent No. 2 in fact abused vested discretionary powers, which are to be invariably exercised for the benefit of tax payer and that also without evaluating the fact that the registered person/importer does not stand to gain , neither any thing nor a delay on his part give rise to or create a valuable right in favour of the Revenue-department and the judiciary is respected not on account of its power to legalized injustice under the garb of technicalities, but because, it is capable of removing injustice and the tax payer being citizen of Pakistan has a right under its Constitution to expect so. Whereas, the Hon'ble Lahore High Court held in reported judgment 2002 PTD 549 Laser Praxis Deplix Clinic Lahore v. Customs Central Excise and Sales Tax Appellate Tribunal held that delay in filing appeal of the litigant has to be condoned on the strength of the observation made in Controller of Land Acquisition v. Mst. Katiji and others [1987] 56 Tax 130 (S. C. India) by Mr. M.P. Thakkar, J. Speaking for the Court favoured adjusted oriented approach by finding that (i) A litigant does not stands to benefit by lodging an appeal late. (ii) Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this, when delay is condoned, the highest that can happened is that a cause would be decided on merits after hearing the parties. (iii) "Every day's delay must be explained" does not means that a pedantic approach should be made. Why not every hour's delay, every second's delay? The doctrine must be applied in a rational common sense and programmatic manner. (iv) When substantial justice and technical consideration are pitted against
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each other, the cause of substantial justice reserved to be preferred for the other side cannot claim to have vested right in injustice being done because of a non deliberate delay. (v) There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides a litigant does not stand to benefit by resorting to delay infact he runs a serious risk. (vi) It must be grasped that judiciary is respected not on account of its powers to legalized un-justice on technical ground but because it is capable of removing un-justice and is expected to do so" The respondent No. 2 through rejection of appeals of the appellants as time-barred, not only gave harsh and unjust treatment. Instead, additionally gave differential treatment, which is tantamount to discrimination and barred under Articles 4 and 25 of the Constitution despite standing on the same pedestal as other importers, whose appeals were decided on merit, without touching the aspect of limitation, validating that he has no urge, will, passion and ability to decide the case/dispute put before him on merit. 8. The respondent No. 2 intentionally and willfully also ignored the settled principle of law by the Superior Judicial fora that no limitations runs against ab-initio void order, despite admitted and apparent position that the recovery was created in isolation without issuance of show-cause notice under Section 180 as contemplated in Section 32(3) of the Act and in usurpation of the powers delegated to the authority under the said provision of Act through clause 3(ii) of SRO 371(1)/2002 dated 15.06.2002, namely Principal Appraiser. These vital defects available in the reassessment order, render it palpably illegal and a such ab-initio, null and void, no limitation runs against such types of orders , litigant is entitled to challenge the vires of such types of orders immediately upon having the knowledge, which appellant did. I have arrived on the said opinion, while driving assistance from reported judgment 1986 SCMR 962 Rehmat Bibi and others v. Punno Khan and others, 1996 SCMR 2296 Syed Haji Abdul Wahid and another v. Syed Sirajuddin and PLD 1976 Supreme Court 37 Ali Muhammad v. Hussain Bux and another, wherein, the Hon'ble Judges of the Supreme Court of Pakistan "On the question of limitation, referred to a number of decision of Apex Court and held that if an order is without jurisdiction and void then it needs not to be formally set aside. In Yousuf Ali v. Muhammad Aslam Zia and others in reported judgment PLD 1958 SC (Pak) 104 (1) it was said by this Court "Where the legislature clothes an order with finality, it always assume that the order which it declares to be final is within the power of the authority making it and no party can plead as final and order made in excess of powers of the authority making it, in the eyes of law, such order being void and non existent". In PLD 1965 SC 68 Ch. Altaf Hussain and others v. The Chief Settlement Commissioner (2) it was said that an order without jurisdiction is a nullity in law and it does not require to be set aside formally. Again in PLD 1967 SC 294 Syed Ali Abbass and others v. Vishan Singh and others (3) it was observed that where an authority has passed an order in excess of jurisdiction, the petitioner cannot be refused relief and penalized for not throwing himself again by way of revision or review on the mercy of the authority who were responsible for such excess this being the rule firmly established, the dismissal of writ petition by the learned single judge on finding that the appeal before the Additional Settlement Commissioner was barred by time and in dismissing it he had acted with jurisdiction was not warranted in law." The Hon'ble High Court of Sindh in adherence of the ratio decidendi held in reported judgment 2002 PTD 87 FOP v. Metropolitan Steel Corporation held that "when a Court or a Tribunal assume jurisdiction not vested, its order is void and nullity to law and no limitation runs against a void order " Hence, now it's a legal fiction that no limitation runs against a void and ab-initio order without any exception, akin to the reassessment order passed in the appellant case without lawful authority/jurisdiction. Hence, not…
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