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Petitioner: Messrs QADRI HAJVERI GOODS FORWARDING AGENCY (REGD.), LAHORE VS Respondent: DIRECTORATE GENERAL OF INTELLIGENCE AND INVESTIGATION-FBR, SUKKER and 2 others
Court Name: Customs Appellate Tribunal Judge(s): Muhammad Nadeem Qureshi, Ghulam Ahmed Title:Messrs QADRI HAJVERI GOODS FORWARDING AGENCY (REGD.), LAHORE vs
DIRECTORATE GENERAL OF INTELLIGENCE AND INVESTIGATION-FBR, SUKKER and 2 others Case No.: Customs Appeal No,K-339 of 2012 Date of Judgment:2013-10-29 Reported As: 2014 PTD (Trib.) 1566 Result: Appeal accepted Judgment ORDER GHULAM AHMED (MEMBER TECHNICAL-II.--This order shall dispose of the instant appeal filed by Messrs Qadri Hajveri Goods Forwarding Agency (Regd.), Lahore, against Order-in-Appeal No,6065 of 2012 dated 15-5-2012, passed by the Collector of Customs (Appeals), Karachi against the Order- in-Original No, 20 of 2011 dated 5-9-2011, passed by the Additional Collector, Model Customs Collectorate, Customs House, Hyderabad. 2. Brief facts of the case are that the staff of Directorate of Intelligence and Investigation-FBR, Regional Office, Sukkur, intercepted a Trailer Container bearing Registration No, Z-3349 at G.T. Road near Toll Plaza, Rohri loaded goods i,e, Crockery, body spray, shampoo, face lotion, bath soap, cigarette lighters, Iron etc. along with local misc. parchoon goods coming from Lahore to Karachi. The driver of the Trailer produced one bilty No, 04032/552 showing dispatch of Pakistan Origin paper rims issued by the appellant. But he was enable to produce any legal document regarding lawful possession of the aforesaid loaded foreign origin goods, therefore, the same were detained and detention memo. was served accordingly. The superintendent reported that "in view of the above facts it is quite clear that the recovered foreign origin goods are smuggled" which were brought into the country without payment of duty and taxes, therefore, the goods were seized under the relevant provisions of law. 3. That on the basis of report the appellant was accordingly charged under the relevant provisions of law through a show-cause notice, which was replied vide letter dated 28-11-2011 and addendum dated 27-1-2012 controverting interception detention, seizure of the transported goods and the
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charges levelled therein. The respondent No, 1 disagreed with the contention of the appellant and passed order-in-original dated 25-11-2011 holding that the goods transported by the appellant are smuggled goods. 4. Messrs Nadeem and Company, Karachi on behalf of Messrs Qaderi Hajveri Goods forwarding Agency, Lahore has sent another letter bearing No, NC/GHGFA/ADCA(MCCH)/708/07/2011 dated 5- 7-2011 wherein the seizure of goods by the Directorate of Intelligence and Investigation-FBR, Range Office Sukker and subsequent issuance of the show-cause notice of this office has been termed as nullity of law. The consultant has requested for the vacation of the show-cause notice. 5. I have examined the case record, considered the verbal as well as written arguments of both sides. Consequently I do conclude as under:-- The goods covered under Bility Nos, 09886/83 and 09885/65 (i) Messrs Fazal Enterprises on receiving the show-cause notice have provided import documents on the basis of which they claimed that the goods booked under bilities No, 09886/83 and 09885/65 were imported and cleared form Mughalpura Dry Port, Lahore on payment of duty and taxes. To substantiate his claim Messrs Fazal Enterprises, Karachi provided 07 GD's at mentioned at para 21 of this order. The Seizing Agency was directed to examine these GD's to ascertain the relevance of these GD's with the seized goods claimed by Messrs Fazal Enterprises, Lahore'. The seizing Agency vide their letter C.No, 10(I)DCl/SK/Cus/2011/319 dated 1-8-2011 have reported that "a careful scrutiny of the import documents and above mentioned registers, led to the conclusion that the seized goods of Messrs Fazal Enterprises do tally with the documents of import. The registers of stock purchase and sale were also cress checked with the documents of import which were also found updated and correct." (ii)In consideration of the confirmation by the Seizing Agency regarding the relevance and validity of the produced documents there remains no dispute about the legal import of these goods. Therefore, I do hereby order to release these goods to Messrs Fazal Enterprises, Lahore. The goods covered under Bility Nos, 03524 and 03525 (iii)One Mr. Muhammad Anees has claimed the ownership of 45 pieces of National Electric irons and 90 pieces or small National local made iron of inferior quality (Bility Nos, 03524 and 03525) which he claims were purchased from local market, Lahore. The seizing Agency replying to the claim of Mr. Muhammad Anees has stated that the country of origin is embossed on the seized items. The seizing Agency is of the view that if it is supposed that irons are local made then why made in Japan is written on these irons. The Seizing Agency has requested to confiscate the seized counterfeit irons. (iv)In consideration of the fact that the owner of these irons is a small shopkeeper and he has purchased these goods from local market of Lahore. I am inclined to take a lenient view. The goods are confiscated, however an option is given to the owner of the seized goods to redeem the same on payment of redemption fine equivalent to 10% of the value of the seized goods in addition to duty and taxes chargeable thereon to be ascertained by the Customs Dry Port, Hyderabad. If the owner fails to availed the redemption fine option within two months of the issuance to this order, the goods shall stand confiscated outright. The goods covered under Bility Nos, 3515/30, 4031/10, 3510/02, 3513/15, 3526/12, 3518/19, 4029/128/129, 4028/79, 3519/20, 3514/13, 3508/03, 3521/02, 3517/25, 3516/2563, 3520/15, 3525/21 and goods without bility Nos, mentioned at serial Nos, 9, 17,18,21, and 25 of the Seizure Report. (v)Coming to the view point of third defendant which has been communicated by the consultant Messrs Nadeem and Co, Karachi I do find that the consultant has tried to skirt the allegation of smuggling and the illegal entry of the goods into the country. The consultant has raised irrelevant legal issues instead of taking the allegation head on. The legal objection raised by him before the Hon'ble Federal Tax Ombudsman have been reiterated before this forum. These objections were
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properly responded by the Directorate of Intelligence and Investigation-FBR Karachi in their parawise comments submitted before the Hon'ble Federal Tax Ombudsman in Complaint No,133/KHI/CUST(52)/341/ 2011. The Hon'ble FTO vide decision/findings dated 1-6-2011 was pleased to reject the complaint of Messrs Qaderi Hajveri Good Forwarding Agency, Lahore filed through Messrs Nadeem and Company, consultant, Karachi. It will be pertinent to reproduce here para 9 of the Hon'ble FTO's decision. "The jurisdiction of Directorate General Intelligence and Investigation relating to smuggling, evasion of taxes and removal of dutiable goods could not be denied. Similarly, the adjudication proceeding on the basis of report by the Directorate General, intelligence and Investigation are within the parameters of Customs Act. In such view of the matter, the contention of the AR that seizure of goods during transportation within the country was illegal could not be given much weight. Reliance on judgment of the superior courts also appeared to be misplaced as the case- law relied by the complainant was distinguishable on facts as well as law points. To the contrary, the Department filed a copy of judgment of Hon'ble Supreme Court dated 30-9-2009 in Customs Appeal No, 277/2002 and copy of judgments of the Hon'ble Peshawar High Court Peshawar dated 8-10-2003 in F.A.O No, 90/2002 having similar facts and law points. The Hon'ble Supreme Court held the seizure and confiscation of old motor parts being transported from Quetta to Jacobabad valid. The Hon'ble Peshawar High Court also held confiscation of tea being transported in a truck and seized by police of Police Station Naurang as legal. The plea of the complainant could possibly be entertained upon production of relevant import documents to the extent of crockery and other goods for which the documents were produced nor was the duty and taxes paid." (vi) The seizing Agency vide their letter No, I0(I)/DCl/SK/Cus/ 2011/369 dated 27-8-2011 have communicated their view points as under; "it is submitted that the items claimed by Qadri Hajveri Goods Forwarding Agency, Lahore shown at S. Nos, 17, 18, 25 and 26 of the seizure report in the colunIn of description of seized goods are covered under section 2(s) of the Customs Act, 1969 and the Notification S.R.O. 566(1)/2005 dated 6-6-2005, the CIF value of each item thereof is given below: S.NO DESCRIPTION OF GOODS QTY CIF VALUE 17 Without Bilty No 2160 Pcs43000 Flavia Soap (150 gms) made in Turkey 45 cartons each carton contains 48 pcs 18 Without Bilty No 192 Pcs 26000 LOREAL Kids Shampoos (265 ml) (USA) 16 cartons each cartons contains 12 pcs 25 Without Bilty No 3840 Pcs76000 LUV Luxury Soap (1.0 gm) made in Oman 80 cartons each carton contains 04 Dozens) 26 Bilty No, 3520/15 64800 Pcs86000 Pantene Shampoos Cachets (Saudi Arabia)
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The total value of the above items falling in the ambit of section 2( Customs Act, 1969 claimed by the above named claimant come Rs,231,000.00 2. It is informed that the above mentioned items do claimed by Messrs Qadri Hajveri Goods Forwarding Agency, Lahore are covered under S.R.O. 499(1)/2009 dated 13-6-2009 as mentioned at para (a) of the said S.R.O. It is respectfully added that the CIF value of the goods claimed by the said claimant is Rs, 231000 therefore the items stated above fall in the ambit of section 2(s) of the Customs Act, 1969." Consequently the goods covered under (without bility No,(3 items as specified under the preceding sub-para (sub-para No, vi) and the Bilty No, 3520/15 are confiscated outright for the violation of sections 2(s) 16 and 168 of the Customs Act, 1969 read with S.R.O. 566(1)/2005 dated 6-6-2005 further read with section 3(1) of Imports and Exports (Control Act, 1950). Therefore the same are confiscated outright in terms of clauses (8) and (89) of section 156(I) of the Customs Act, 1969. (vii) Other goods except the goods specified under preceding sub-para (sub-para No, vii) owned by Messrs Qaderi Hajveri goods Agency, Lahore are confiscated as I am inclined to agree with the view point of the seizing Agency that the goods covered under above mentioned bilties were brought into the country without payment of duty and taxes in terms of clause (90) of section 156(1)/ of the Customs Act, 1969. However the owner is given an option to redeem the goods on payment of redemption fine equivalent to 20% of the ascertained value of the goods in addition to- chargeable duty and taxes. Redemption option shall remain valid for two months from the issue date of this order. After the lapse of two months the goods shall stand confiscated outright. 6. The appellant against Order-in-Original No, 20 of 2011 dated 5-9-2011 filed an appeal before the learned Collector of Customs (Appeals), Hyderabad, who disposed it vide order dated 15-5-2012, the operative paras 6 and 7 of the impugned order read as under:- "6-I have carefully considered the written and verbal submission of the rival. Learned counsel for the appellant argued that the confiscated goods are backed by legal import documents which he provided and same are placed on record. The respondents on the contrary argue that these goods are smuggled and without any legal import backing whatsoever. After careful examination of the grounds of appeal and the said documents I feel that these do not accord any legal status or provide cover to the seized/confiscated goods. hence these cannot be accepted as credible/reliable evidence. Moreover, I am of the view that the judgment of the Superior Courts and other Forum quoted by the appellant have no bearing on the facts and circumstances of this particular case". "7-It is observed that the adjudicating authority has already taken a lenient view and as allowed the release of impugned goods to other claimant in terms of section 181 of the Customs Act, 1969 read with S.R.O. 499(1)/2009 dated 15-6-2009 on payment of fine along with leviable duty and taxes. Accordingly, in all fairness, the appellant also deserved similar treatment which was denied to them by the adjudicating officer, since most of the goods claimed by the appellant were confiscated outright without giving them the option of release of the impugned goods against redemption fine etc. Thus, I rule that the appellant are free to get their confiscated goods released in terms of section 181 of the Customs Act, 1969 read with S.R.O. 499(1)/ 2009 dated 15-6-2009, on payment of 20% redemption fine along with leviable duty and taxes. The respondent have not given any cogent reason which could defend their earlier stance of outright confiscation of the goods as communicated in the order-in-original. however they have now consented to the relief being offered to the appellant."- 7. The appellant has now challenged the above order by way of this appeal on the strength of grounds taken in the memo of appeal reading inter-alia : The respondents Nos, 1 and 2 in orders dated 5-9-2011 and 15-5-2012 failed to distinguish or discuss the law including citation, instead made academic discussion of personal nature in regards to
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fiscal statute, which is not sustainable in comparison to the Law and the judgment of Hon'ble Superior Courts of Pakistan. Hence erred in passing the orders and these are not sustainable in law as these are clearly contrary to the Law/ Rules, being erroneous and not in consonance of law, equity and natural justice and the said fact further stood validated from the following:-- 0 That instead of deciding the case within the parameter of law and dictum laid down by the Superior Courts of Pakistan, which are binding on all the citizen of Pakistan including the hierarchy of customs under Articles 189, 190 and 201 of Constitution of Islamic Republic of Pakistan. The respondent No, 2 discarded all the citations submitted with the reply to the show-cause notice as Exhibit "G to AF" at pages 42 to 245. Instead took refuge before the order of the Hon'ble Federal Tax Ombudsman, while incorporating a portion of that in sub-para (v) of para 33 of the Order-in- Original. The said finding/ recommendation has no binding force and neither can influence the proceeding before him. The respondent No, 2 also failed to consider the fact that the cases referred-by the Advisor to the FTO in the finding were not relevant in the case of appellant rather were of exceptional circumstances, besides those were not confronted with the appellant. Even otherwise proceeding before FTO and respondent No, 2 are independent of each other and least cast influenced on the proceeding conducted by the respondent No,2. Nevertheless, appellant state for the sake of regularization that the order of the FTO cannot be relied upon as citation as it has no binding force by virtue of non-availability of legal sanction. Beside the order of the FTO was not correct and was devoid from legal infirmity and partial/discriminatory as evident from reported judgment 2011 PTD 1205, 2011 PTD 1425, Finding/ recommendation in Complaint Nos, 491/KHI/Cus(243)/ 1243/11 and 492/KHI/Cus(244)/1244/11 dated 29-11-2011 and therefore the appellant challenged its virus before President of Pakistan through a representation dated 27-6- 2011 under section 32 of the Ordinance No, XXXV of 2000, resultant the finding/ recommendation stood stayed. Putting reliance on that is patently is illegal and void. (Exhibit "P" and "Q") (ii) That since the respondent No, 2 has relied upon the finding/ recommendation of the FTO, while passing order-in-original, it is felt appropriate for the appellant to comment on the veracity and legality of that prior to giving rebuttal on the impugned show-cause notice and order-in-original for proving that the order of the FTO was based on mala fide and intellectual dishonesty (a)That during the hearing the Advisor to the Hon'ble Federal Tax Ombudsman when felt that the complaint of the appellant is correct and the act of respondent No, 1 and respondent No, 2 are contrary to the law, Rules and Regulation and well supported by the judgments of Superior Courts of Pakistan and he has no reason or cause to dismiss that. He put his word in the mouth of the official of respondent No, 1, that there exist a judgment of High Court of Peshawar, wherein the act and commission of the respondent No, 1 is held valid, the same should be provided to him and a copy of the same to the appellant consultant. To which the consultant objected and advised the learned Advisor to be fair and independent and not part with the official of respondent No, 1. Upon this he became hostile and concluded the hearing. Nevertheless, the said judgment has not been supplied to this date to the consultant, instead the same was obtained by the consultant of the appellant, after receipt of finding/recommendation. Any decision on the basis of judgment provided at the back of appellant is bad in law as the same defeat the norms of justice, fairplay and independence. (b)That while ignoring the judgment supplied by the appellant vide letter dated 9-4-2011 and hand delivered during the hearing conducted on 26-4-2011. The learned Advisor to the FTO relied in Para 9 of the finding/recommendation on a judgment of Hon'ble Supreme Court in Customs Appeal No, 277 of 2002. Wherein, the Hon'ble Supreme Court held the seizure and confiscation of old motor parts transported from Quetta to Jaccobabad as valid. The appellant also agrees to that because the item so transported are included in the list of smuggled goods items at serial No, 1 of Notification No, 566(1)/2005 dated 6-6-2005. Meaning thereby that auto-parts whether used,
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old and new are to be termed as smuggled unless proven otherwise. To the contrary, the appellant detained goods also included an item listed at serial No, 27 of the notification i,e, cotton yarn, which was detained and subsequently released including with paper corresponding to bilties Nos, 802, 4001, 4032, 2543 and 2551, on the plea that cotton yarn and paper are locally made irrespective of the fact that the cotton yarn and paper is also imported in bulk. Rendering the detention and release of cotton yarn as nullity to the provision of Customs Act, 1969 and Notification No,566(I)/2005 dated 6-6-2005. (c) That in the same Para the learned Advisor to the Hon'ble FTO referred to the judgment of Peshawar High Court in F.A.O No,90 of 2002, which was obtained by him from the official of respondent No, 1. While stating that the same is having similar facts and law point as has been raised by the applicant. That in principal it was mandated upon the learned Advisor not to rely on the said judgment as no copy of the judgment was supplied to the appellant for comments. Nevertheless, the appellant state that the subject judgment least have similar facts and law points. In fact the said judgment does not correspond to the goods (black-tea mentioned at serial No,35 of S.R.O. 565(1)12005 Exhibit "R") loaded on the carrier, instead for the carrier (Truck). Which was ordered to be released to the lawful owner on the redemption money of Rs,300,000.00 by the Adjudicating Authority. The said order was assailed before the Customs, Central Excise and Sales Tax Appellate Tribunal by the Customs. The Tribunal allowed the appeal and set aside the order of the Adjudicating authority. Consequent to which the owner of the truck assailed the said order before the Hon'ble High Court of Peshawar vide F.A.O. No, 90 of 2002. Which allowed the appeal of the truck owner and set aside the order of the Tribunal and restored the order of Adjudicating Authority. Which was subsequently, challenged by the Customs before the Hon'ble Supreme Court of Pakistan through C.P.L.A. No,419-P of 2002. Which remanded the case to Hon'ble High Court of Peshawar for decision in 3 issues. On remand the Hon'ble High Court of Peshawar answered the issues framed by the Hon'ble Supreme Court and once again maintained its earlier - order vide order dated 28-10-2003, i,e, setting aside order of the Tribunal and restoring order of the Adjudicating Authority. (d) That the above submission and the copy of judgment confirms that the incorporation made in para.9 of the finding/ recommendation is based on mala fide as the learned Advisor only discussed the goods loaded on the truck, for which the Hon'ble Supreme Court framed the issue but not the carrier on which the goods were loaded and to which the said F.A.O. relates. Instead the learned Advisor to the Hon'ble FTO concealed the said fact and made a mutilated submission for deceiving the Hon'ble FTO and for dismissing the appellant complaint despite correct in fact and law. Beside the learned Advisor also concealed the fact in the finding/recommendation that the carrier/trailer on which the detained/seized goods were transported by the appellant had already been released by the respondent No, 1 because the said fact nullify the allegations levelled by the respondent No, 1 and respondents because in case the goods were smuggled, there was no cause or reason to release the trailer/carrier, in terms of condition (b) of Notification No, 499(I)/2009 dated 13-6-2009. (iii) The appellant now revert to the rebuttal on the impugned show-cause notice and the order- in-original issued/passed by the respondent No, 2 to/against the appellant, which fails to answer the allegation levelled/held therein, while submitting as under: (a) That upon receipt of the contravention report, it was mandated upon the respondent No, 2 to look into the actual facts of the case and the applicable provision of the Act, Rules and Regulation independently and fairly. Instead he completely relied upon the version of the officials of respondent No, 1 and mechanically signed the show-cause notice on the basis of the contravention report forwarded to him by the official of the respondent No, 1, rendering it nullity to the law laid down by the Superior Courts of Pakistan. Reliance is placed on the reported judgment
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2004 PTD 369 Messrs Zeb Traders v. Federation of Pakistan. Wherein their lordship of the High Court held in unambiguous terms that: "The proceeding before Adjudicating Officer, under the Customs Act, 1969 are in the nature of quasi judicial proceedings and issuance of notice under section 180 of the Customs Act, is very important document. The decision to issue show-cause notice is to be taken by the Collector, Adjudication, by application of independent mind and not merely signing the draft show-cause notice submitted by the investigation agency separate from the Adjudication Department and each category of officers are required to perform their respective functions/duties under the law. The practice to submit draft show-cause notice by the Director General of Intelligence and Investigation to the Collector Adjudication is depreciated." (b) That since the show-cause notice and order-in-original issued/ passed by respondent No, 2 in the present shape are void of all legalities as these do not provide valid reasoning and incriminating evidences for determination of levelled charges besides it is nullity to the laid down dictum by the Superior Courts of Pakistan. The appellant consultant through several letters requested the respondent No, 2 to substantiate the levelled allegation. Instead completely failed to justify the illegal act of the officials of the respondent No, 1 and the issuance of the instant show- cause notice on the basis of false and mutilated facts. Rendering the show-cause notice and subsequent order-in-original and appeal as ab inito, null and void on the face of it, which stood substantiated from the foregoing: (i) That intercepting goods transported with in the territory of Pakistan, by the respondent No, 1 is tantamount to abuse of power as no interception can be made unless a provision exist in the Act or any notification is in field directing the transporter to obtain documents of import or purchase prior to booking of the goods meant for transportation within the territory of Pakistan and the driver of the trailer/carrier should contains those documents during the journey. No such section is available in the Act and nor any notification is in field. Resultant interception of the transported goods at Rohri Tool Plaza, Sukkur by the officer of respondent No, 1 is patently illegal rather confirms without any ambiguity abuse of power and high handedness. (ii)That irrespective of the referred in above illegality it is appropriate for the appellant to state that it was mandated upon the respondent No, 1 to act within the frame work of the definition of the word "smuggle" given in subsection…
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