MUHAMMAD ARIF MOTON (MEMBER JUDICIAL-II).--- This order will dispose of Customs Appeal No, K-628 of 2009, filed by the appellant against Order-in-Appeal No, 2004 of 2009, dated 29-9-2009 passed by the Collector of Customs (Appeals), Karachi.
2. That brief facts of the case as reported are that the appellant electronically filed goods declaration declaring to contain steel wire rod in coils, at total invoice value of US$. 75,400. They determined their tax liability on their own and sought clearance thereof under section 79(I) of the Customs Act, 1969. However, in order to check as to whether the appellants had paid correct amount of duties/taxes the aforesaid GD was selected for scrutiny in terms of section 80 of the Customs Act, 1969. Scrutiny of the goods declaration in light of the examination report revealed that the appellants had miss-declared the actual value of the goods during the course of physical examination the examination staff had found original invoice from the container which indicated the total value of the goods as US$. 191,732, whereas the invoice filed indicated the total declared value as US$.75,400. The declared value was as low as 154.29% of the actual value as evident from the original import documents discovered from the container. The appellants had committed an offence by filing fake and forged documents/particulars of the goods besides making an attempt to clear imported goods at highly under invoiced value and attempted to defraud the government from its legitimate revenue amounting to Rs, 2,977,718.00. The appellants were accordingly charged under the relevant provisions of law and the adjudicating officer held that the charges against the appellants had been proved. The operative part of the impugned order reads as under:-- "I have examined the case read examination report carefully. In this case the importer electronically filed Goods Declaration bearing CRN-816434 declared to contain steel wire Rod in Coils, at total invoice value of US$. 75,400. Scrutiny of the goods declaration in light of the examination report revealed that importer has miss-declared the actual value of the goods. During course of physical examination the examination staff has found original invoice from the container which indicates the total value of the goods as US$. 191,732. Whereas the invoice electronically filed indicated the total declared value as US$. 75,400. The declared value is as low as 154.29% of the actual value as evident from the original import documents discovered from the container. The importer has therefore committed an offence by filing fake and forged documents/ particulars of the case besides making an attempt to clear imported goods at highly under invoiced value wilfully and with mala fide intention and have attempted to defraud the government from its legitimate revenue amounting to Rs,2,977,718.00, the contention of the importer that the fine should be charged on the differential of the values between the two invoices that is the one declared and the one found is not tenable as the prescribed pitch of fine in the relevant S.R.O. 487(1)/2007 is the total offending value of the goods in the case if valuation difference exceeds beyond 30% on the basis of direct evidence and in this case the invoice recovered is the direct one from the supplier to the importer and there is little discretion left for the adjudicating officer to change the pitch of fine. I hereby order confiscation of the goods. Moreover the values are the export sale price to Pakistan with reference to the time and transaction and the supplier has specifically supplied the correct invoice in the container. However, the importer is given an option under section 181 of the Customs Act, 1969 to redeem the goods on payment of fine equal to 50% on offending value of total consignment (Rs,1,55,48,403/30) along with duty and taxes leviable thereon. The allegation as leveled in the show-cause notice stand proved. In terms of clauses (14), (14-A), (45) to section 156(I) of the Customs Act, 1969 read with S.R.O. 487(1)/2007 dated 9th June, 2007. I also impose a penalty of Rs,5,00,000.00 upon the importer NTN holder."
3. The order was challenged before respondent No, 2 who also vide his order dated 29-9-2009 rejected the appeal by observing that:-- "I have examined the case record and given the consideration to the arguments made before me.
Admittedly an invoice was retrieved from the container which showed that the transaction value of the goods was US$.191,732.00 whereas the appellants had declared the value of the goods to be US$.
75400. Thus, there is no doubt that the actual transaction value of the goods imported in this case was US$ 191,732.00 and the appellants had under invoiced the same to the tune of whopping 154.29% on the strength of fabricated documents. The principal plea of the appellant's consultant is that since in another case (CRN-IHC-815094-0411,08) the Paccs had not taken penal action against the importer in similar circumstances the penal action taken in this case may also be waived. The aforesaid plea is untenable for the simple reason that if the departmental head not acted in accordance with law in one case it cannot be forced to extend the same illegality in another case.
However, it is recommended that the management of the Collectorate may look into the case mentioned above with a review to taking remedial action. It also needs to be stated that consignments imported under the self-assessment system operative under Paces are cleared on the basis of the declaration made by the importers and only very few of them are picked for thorough scrutiny under the system managed selectivity criterion. Therefore, the appellants had self-assessed their tax liability and paid the duty/ taxes as per their (mis)declaration and had the instant consignment not been selected for thorough examination, the appellants would have got away with the miss-declaration and caused revenue loss of Rs,2977718.00 to the Exchequer.
Therefore, the intention to commit fraud is clearly established. The arguments advanced by the learned counsel are clearly belied by the evidence available on record and the precedents quoted by the learned consultant are not relevant to the fact of the instant case. The penal action taken against them is also in consonance with the parameters prescribed under notification S.R.O.
487(1)/2007 dated 9-6-2007 and the gravity of the offence committed in this case. Therefore, I hold that the impugned order is correct in law and on facts and there is no reason to interfere with the same. The appeal is rejected accordingly."
4. The appellant has now challenged the above order by way of this appeal. The consultant Nadeem Ahmed Mirza appeared on behalf of the appellant who reiterated the arguments incorporated in the memo of the appeal. And emphasized that:--
(i) That the instant appeal attracts the jurisdiction of bench sitting singly, by virtue of the expression of subsection (3) of section 194-C of the Customs Act, 1969, reading as: "Every appeal against a decision or order [deciding a case involving duty, tax, penalty or fine exceeding five million rupees] shall be heard by a Special Bench constituted by the Chairman for hearing such appeals and such Bench constituted by the Chairman for hearing such appeals and such Bench shall consist of not less than two members and shall include at least one Judicial Member and one Technical Member."
(ii) That since, the expression of statute states in clear and in unambiguous terms that an appeal wherein involved duty, tax or fine exceeds five millions rupees has to be fixed before a double bench comprised of one Member (Judicial) and one Member (Technical), vice versa in case of below than Rs,5 million it has to be fixed before a bench sitting singly. That since in the instant appeal the amount of duty and penalty are not exceeding either individually or cumulatively Rs,5 million. Hence, the instant appeal fall within the jurisdiction of bench sitting singly.
(iii) The appellant in support of his stance further states that when the meaning of the statute is clear, rule of interpretation does not apply. The principle of construction of statutes always draw upon first on the expressed language of the statute, where the context and the language resolve the meaning, resort to object and purpose is uncalled for. All rules of interpretation have been devised as aids to the discovery of legislative intent behind an enactment. Where the words are plain and unambiguous that intent can be best judge by giving full effect to the ordinary grammatical meaning of those words. The words of subsection (3) of section 194-C of the Customs Act, 1969, are plain and unambiguous, hence full effect to the ordinary grammatical meaning of those words has to be given by the Tribunal/Court. Beside neither practice of the court nullify the provision, which is not contained in the provision of that statute. Hence it has to be followed in its ordinary meaning and as per intention of the legislature as held by their Lordship of High Court of Sindh in 2004 PTD 901 Messrs Haswa ni Hotels Ltd. v. Government of Pakistan.
(iv) That the appellant has not denied at any stage that he has not filed GD on the basis of invoice received after re-negotiation of the contracted prices and this stance was taken at the original adjudication stage and even at appellate stage. The respondent Nos.1 brushed aside the submission made, whereas the respondent No,2 asked to produce the correspondence wherein price was re-negotiated. Photocopies of e-mails were supplied. Contrary, the respondent No, 2 ignored those and not even felt appropriate to offer his comments in the order-in-appeal. The appellant submitted the respective correspondence about the price negotiated and re- negotiated, the seller acceptance of the revised unit value, the amount of price was actually paid for the consignment and the reason for re-negotiated prices. The whole exercise was done by the appellant prior to filing of GD electronically. Whereas, finding of invoice from the container stood ably diluted from the e-mail of the seller dated 2-10-2008. Which was ignored by the respondent for penalizing the appellant.
(v) That in the given circumstances, sections 32(1), 32(2) or 32(3) are not applicable on the appellant by virtue of the fact that he was not knowing had reason to believe that the declaration or statement he was making electronically, which are the subject of the charges were false in material particular by virtue of availability of invoice in the container and the said fact stood verified from the e-mail of the shipper, absolving the appellant from the charge of misdeclaration in material particular. The said fact stood fortified from the reported judgment 1988 PCr.LJ 891 Abdul Aleem v. The State.
(vi) That the impugned orders of the respondent are discriminatory and violative of the principle of natural justice/mandatory provision of law due to the reason that in the same situation/ circumstances the respondent No, 1 opted for the adjudication instead of cancelling the contravention report and should have forwarded a view message for payment of additional amount of duty and taxes after assessing his goods on the value, wherein, the goods of similar/identical type of other importers were assessed (i,e, data of last three months available in the system of the PACCS) as was done by the respondent in the case of import of HDP FILM GA 3750 corresponding to CR No, I-HC-815094- 041108, wherein, initially goods were assessed on the basis of scan price of October 1, 2008. Subsequently, an invoice of higher value then declared and assessed was found from the container and a contravention report was prepared. Which was deleted by the respondent being competent authority with the direction to assess the GD on the scan prices as against the value shown in found invoice.
(vii) The differential treatment given to the appellant is in violation of Article 25 of the Constitution as well as ruling of the superior Courts delivered in umpteenth numbers of judgments few of which are enumerated here-in-below. Wherein their lordship held with clarity that there is no power to target incident of tax in such a way that similarly placed persons are dealt with discrimination or facility allowed to one and denied to other, amounts to discrimination:
(a) Messrs Zaman Cement Company (Pvt.) Ltd. v. C.B.R. 2002 SCMR 312.
(b) Pakistan v. Muhammad Saleem PLD 1995 SC 396.
(c) Messrs Gatron Industies Ltd. v. Pakistan 1990 SCMR P. 1072.
(d) Pakistan v. Messrs Azhar Brothers Ltd., 1990 SCMR P. 1059.
(e) Commissioner v. Makhdoom Syed Hussain Shah, 1975 SCMR P.352.
(f) Collector v. Ms. Novartis Pakistan Ltd. 2002 PTD 976.
(g) Messrs M.Y. Electronics, 1998 SCMR P.1404.
(h) Messrs Elahi Cotton Mills Ltd. v. Pakistan, PLD 1997 SC 582. (1) Messrs Sandalbar Enterprises v.
C.B.R. 1997 PLD SC 334.
(j) Messrs Flying Craft Paper Ltd. v. C.B.R. 1997 SCMR 1874.
(k) Government of. Pakistan v. Village Development Organization 2005 SCMR 492. .(viii) That regarding the valuation aspect, the order-in-original states in para.3 that evaluation has been done on the basis of similar kind of goods in terms of section 25 of the Customs Act, 1969 and Rule 107(a) of the Customs Rules, 2001. No evidence regarding the valuation has been brought on record in the form of invoice of contemporaneous goods of the same country and same contracted period or even 90 days data. The observations of respondents Nos. 1 and 2 regarding price paid or payable are based on misconception of transaction value. In fact transaction value envisaged concept of Real Value as against normal value which was prevalent under the Brussels System of Valuation. It was a notional concept where the value of the goods was determined in terms of the value of other identical/similar goods. The initial transaction value payable was US$.
890/MT but the price paid ultimately due to nose-dived prices of the metal in the International Market, after re-negotiating was US$. 350/MT. All this process has been conducted in a very transparent manner through e-mails, starting from cancellation of order and subsequent re- negotiating from September 10, 2008 to October 2, 2008. Confirming that the appellant declared price after re-negotiation was the. Real Value and the stance of appellant stood fortified from the fact that subsequent to appellant consignment, not a single consignment was evaluated as US$.
890/MT of any importer for levy of duty and taxes. That his stance stood further fortified from the judgments of Appellate Tribunal issued in Customs Appeal Nos. 92 of 2006 Junaid Enterprises v.
Collector of Customs (Appeals) and others K-24/2006 Mushtaq and Company v. Collector of Customs (Appeals) and others and Noman Omar and Co. v. Assistant Collector of Customs MCC of PaCCs
(ix) That under no circumstances the assessed value can also even be considered as lowest of identical/similar transaction value, available in data of import maintained under Rule 110 of the Customs Rules, 2001 as per expression of clause (d) of subsections (5) and (6) of Customs Act, 1969 read with Rules 117 and 118 of Chapter IX of Customs Rules, 2001 for the period given in Rule 107(a), because the assessm ent has been 'made in the instant case under section 25(1) as evident from the order-in-original/appeal. Resultant, mentioning of identical/ similar/goods value nullify the assessm ent made, because the MCC of PACCS regularly assess the goods with the application of lowest available assess value as per clause (d) instead of value of import as expressed in Rule 110 ibid of the goods imported by appellant from Indonesia and other companies/persons from Europe and China @ $.475.00 and 535.00, .303.00 and 404.80 and .278.30 PMT respectively as against declared S# CRN/Date Country of ImportD/Value A/Value 1 735447/110808 Indonesia $.404.80 $.470.00
2. 738861/130808 Indonesia $.404.80 $.535.00 1 754846/010908 Belgium 283.40 303.60 2 837020/271108 China 354.20 404.80 3 844176/051208 Belgium 278.30 303.00
(x) The appeal with the respondent was filed on 29-12-2008 and an order under the proviso of subsection (3) of section 193-A of the Customs Act, 1969 and the appeal should have been decided by the respondent within 90 days from the date of filing of appeal or within a further extended period of 90 days during the initial period of 90 days after serving a notice to the person concerned and thereafter the respondent has to record the reason for extension in writing for the extension of the stipulated period. In the instant case the order-in-appeal was passed on 29-9-2009 i,e, after the expiry of total stipulated period of 180 days. Rendering the order-in-appeal barred by time by 94 days.
(xi) The narration of respondent No, 2 at para. 5 of the order-in-appeal that proceeding in this case could not be finalized within the stipulated time limit due to extended hearing and adjournment granted on the request of both parties, therefore the requisite extension in terms of 1st proviso to subsection (3) of section 193-A of Customs Act, 1969 was obtained from the board is without any substance as no adjournment was applied by the appellant or by the respondent No,
1. Hence, the extension granted if any by the board is unsubstantiated and cannot be considered as valid.
Nullifying the stance of the respondent No, 2 that time was extended on the request of both the parties for adjournment. In the light of the narrated facts the order-in-appeal is hopelessly 'time- barred and as such is of no legal effect and cannot be enforced. Reliance is placed on the judgments reported vide. 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 and 2009 PTD 1978 Leo Enterprises v. President of Pakistan and others.
(xii) The appellant carves his right to add any fresh ground at the time of hearing, beside placing any valid incriminating evidence/ document.
5. The departmental representative Mr. Ghulani Yasin, Appraiser, appeared on behalf of the respondent and furnished their comments on above cited grounds of appeal inter alia as under:-- That in terms of proviso to subsection (3) and subsection (6) of section 194C of the Customs Act, 1969, the Chairman, Appellate-Tribunal has powers to constitute Special Benches irrespective of monitory limits. Thus, the contents of para. (i) of Grounds of appeal is incorrect, hence, denied.
(ii) That in the light of submissions made above the contents of para. (ii) of grounds of appeal require no comments.
(iii) That the contents of para (iii) of Grounds of appeal are incorrect, hence, denied. The facts and circumstances of the case are proving that the purported documents placed as "E.- Mails" are fabricated and afterthought.
(iv) That the contents of ground (iv) are incorrect, hence, denied. It is pertinent to mention here that the case of Petro Chemical products is entirely different from the case of steel products. Further as evident from the assessm ent remarks (annexed as "0" at pages 43 of the appeal) in the plastic cases also the date of actual contract was the bench mark for re-ascertaining the values. In the said case the assessm ent was not made on declared value. Further in the case the higher value invoice was found but in that case the importer was able to prove that the price was renegotiated according to the Scan prices prevalent on the date of contract L/C. Whereas here in this case the appellant has failed to substantiate with any corroborative documents that there was any difference/decline of price between the date of contract i,e, 22-9-2008 and the date of shipment i,e, 15-10-2008, i,e, within three weeks how it is possible that the price has been fallen from US$.
890/PMT to 0 USS 350/PMT. Thus, in the light of circumstances faced by the traders of petroleum products an importer of steel item cannot be equated at par with the genuine importers of petro chemical products.
(v) That the contents of ground (v) are incorrect, hence, denied. First of all in the presence of invoice of actual .Payable transaction value there is no question to adopt any other method of evaluation, hence, the appellants consignment was correctly assessed as per supplier's invoice value in terms of section 25(1) of the Customs Act, 1969. Secondly as clarified in the preceding paras in the "Plastic" cases referred by the appellant the appellants had substantiated the reduction of price through the amended L/C and the "SCAN" prices whereas in the instant case of the Steel Wire Rods the appellant has failed to substantiate that the L/C was amended and the "LME" shows drastic reduction in prices of the Steel Wire Rods between the date of contract and the date of export/ amendment in L/C.
(vi) That the contents of ground (vi) are incorrect, hence, denied. It is respectfully submitted that all such cases where importers concealed the values deliberately Without any cogent reasons are dealt accordingly, hence there is no discrimination with the appellant and due to deliberate gross miss-declaration of value the ` appellant deserves no relief.
(vii) That in the light of submissions made above the contents of para. (vii) of grounds of appeal are incorrect, hence, denied. Under the 'GATE CODE OF TRANSACTION VALUE SYSTEM" the first method of determination of value is to determine the customs value after ascertaining the "paid or payable " transaction value. As evident from the page of B/L. i,e, page 25 of the appeal, the goods in this case were imported against the L/C, thus , the actual value of the goods was paid through L/C, thus when the L/C was not amended, prior to shipment/export, then there is no question to accept other value than the one mentioned on the L/C. The appellant's arguments, based on an afterthought e-mails , are not only against the provisions of section 25(1) of the Customs Act, 1969, but also against the principle set out by the honourable High Court in the case of Rehan Umer (2006 PTD 909).
(viii) That in the light of submissions made above the contents of para (viii) of grounds of appeal are incorrect denied. As stated above in the presence of an evidence of true transaction value i,e, L/C of the same consignment, there is no question to make assessment other than the method prescribed in section 25(1) of the Customs Act, 1969.
(ix) That after the amendment, through Finance Act, 2009, the period in terms of section 193-A(3) of the Customs Act, 1969, has been extended to 120 days and as per section 193-A(3) read with first proviso thereof the Collector (Appeals) himself is authorized to extend the period for further 60 days and there is no mandatory requirement to make a notice of hearing specifically for extension of period. Without prejudice to above even if an Order-in-Appeal has been issued after the stipulated period in that case to the order-in-original, passed under section 179 of the Customs Act, 1969, shall remain intake and hold the field.
(x) That in the light of submissions made above the contents of para (x) of grounds of appeal require no further comments, hence denied.
6. The consultant of the appellant during the course of hearing further argued that:--
(i) That as per law and as per provision of section 25(1) read with Rule 389 of the Customs Rules, 2001 the retrieved invoice from the container depict the transaction value of the goods to the contrary the respondent Collectorate official opt to re-assess the imported goods on the basis of available data of import of identical/similar goods, despite not warranted under the provision of section 25(1) ibid and Rule 389 of the Customs Rules, 2001. The said attitude confirms that the retrieved invoice is of no significance and neither depict the transaction value as per absurd opinion of the respondent officials and in support of his stance, the appellant provided the copies of the following GD's annexed with respective import documents showing that:-- CRN/Date Value of Retrieved Invoice Assessm ent Completed I-FS-1091244-300709 US$.541.40/MT US$.590.00/MT I-HC-1200889-071109 273.20/MT 273.20/MT 1-HC-1361 176-2903 10 US$.404.80/MT US$.617.50/MT I-HC-1350598-180310 US$.384.60/MT US$.475.00/MT US$.563.00/MT I-FS-1383496-160410 US$.404.80.00/MT US$.682.50/MT I-HC-1272652-090110 US$.354.20/MT US$.563.00/MT I-HC-1283588-180110 US$.354.10/MT US$.525.00/MT I-HC-1283576-180110 US$.404.90/MT US$.450.00/MT
(ii) The respondent No, 2 obtained extension from the board through a letter dated 2-7-2009 and were granted by the board vide letter dated 24-9-2009 i,e, after expiry of the stipulated period for, deciding the appeal i,e, 29-3-2009. Neither the respondent nor the F.B.R. Were empowered to seek/grant extension as it is akin to giving a new lease of life into a dead entity and it is tantamount to flogging a dead horse. If an event or document has become dead on account of extension of time period it is legally considered dead and new spirit cannot be infused into it by any means or an account of any reason whatsoever or stretch of imagination and the same view was taken by the Hon'ble High Court of Sindh in its reported judgment 2007 PTD 117 while observing that "once a matter become barred by time then the subsequent enhancement in the period of limitation shall not have the effect of reopening the past and closed transaction."
7. Rival parties heard and case records perused and the following issues are framed for consideration by this forum:--
(i) Whether the appellant submitted the respective communication confirming that prices of the goods were re-negotiated due to downward trend of the prices in the International Market as well as domestic market when requisitioned by the Customs in terms of Rule 437 of Chapter III of Chapter XXI of Customs Rules, 2001?
(ii) Whether the revised value for subsequent negotiation is covered by the concept of transaction value as envisaged in section 25 of the Customs Act, 1969?
(iii) Whether in a case covered by confirmed L/C, the price of a container retrieved invoice in terms of Rule 389 of Customs Rules, 2001 can be termed as transaction value of the imported goods within the meaning of section 250) of the Customs Act, 1969?
(iv) Whether the transaction value declared by the appellant is in conformity with the clause (d) of subsection (5) of section 25 of the Customs Act, 1969?
(v) Whether the order-in-appeal is barred by time and without powers/jurisdiction in terms of proviso to subsection (3) of section 193-A of the Customs Act, 1969 being issued after 94 days of the stipulated limitation period of 180 days?
(vi) Whether the subject imports of the appellant have been meted out a differential treatment. As compared to other contemporaneous imports involving an element of discrimination in terms of Articles 4 and 25 of the Constitution of Pakistan read with number of judgments of the Superior Judicial fora?
8. As regards issue No, (i), it is a question of fact. It is not denied by the respondent that the appellant had filed the requisite GD and had submitted all the related documents. Record shows that even at the original stage, the appellant has not admitted any offence and had contested the allegation vide its reply dated 19-11-2008 submitted in response to show-cause notice. Para 2 of the said reply and 7 of the order-in-original dated 1-12-2008 contain Submission to the said effect reading as "it is submitted by virtue of decline of value of the metal in the International Market we refused to accept the said goods as those were not viable for import due" to decline in sales prices of the manufactured goods from the imported goods by our industry as against the amount of the consignment. The seller was also aware of the position of the metal in the International Market he agreed to reduce the unit value and as such he forwarded us the invoice amounting to US$.75,400.00 as against amount of US$.-191732.00, which lie dispatched along with the goods shipped earlier by him prior to sending documents to us for reduced amount." Along with the said submission, the appellant placed on record the copies of e-mail exchanged between him and the seller for re-negotiating of the prices. It appears that the adjudicating officer did not deal with the said reply dated 19-11-2008, instead decided the case against the appellant under a false presumption that the appellant had admitted the offence. This issue, although highlighted in the written appeal under section 193 was also not addressed by the Collector (Appeal). Even otherwise, when the e-mails were placed on record, the same should had been considered by the original authority as well as Appellate Authority as e-mailsare "documents prescribed at clause (i) of subsection (kka) Of section 2 of the Customs Act, 1969. For ease of reference the -same is reproduced herein under-- [{kka} "documents means a goods declaration, application for claim -of refund, duty drawback or repayment of duty , import or export general manifest passenger manifest bill of lading, airway bill, commercial invoice and packing list or similar other forms or documents used for customs clearance or making a declaration to customs, whether or not -signed or initiated or otherwise authenticated, and also includes:-
(i) any form of writing on material, data or information recorded, transmitted, or stored by means of a tape recorder, computer or any other device, and material subsequently derived from information so recorded, transmitted or stored;
(ii) a label, marking or other form of writing that identifies anything of which it forms part or to which it is attached by any means;
(iii) a book, map; plan; graph or drawing, and
(iv) a photograph, film , negative, tape or other device in which one or more visual images are embodied so as to be capable (with or without the aid of some other equipment of being reproduced,and).
There was no benefit to the appellant for not presenting the documents which were in their possession and were legal documents in terms of subsection 2(kka) of section 2 of the Customs Act, 1969 and which they presented accordingly and those should have been considered valid under law, unless any notice under section 26 of the Customs Act, 1969 read with Rule 437 sub- Chapter III of Chapter XXI of Customs Rules, 2001 should have been served/communicated to the appellant for further confirmation of the re-negotiated prices. Nothing was placed on record of the Tribunal by the respondent No, 1 in support of the stance taken in the order-in-original. Besides no decision was also communicated with grounds as enunciated in sub-Rule (3) of Rule 109. To the contrary, the news appearing in "Daily Business Recorder" on 6-12-2008 substantiates the stance of the appellant that the prices of metal declined nosedive. The said fact confirms that no cause or reason was available with the respondent for disputing the transmitted value and the said fact further stood proved from the fact that no evidential invoice as directed in para 78 of C.G.O. 12/2002 of the period expressed in Rule 107(a) was placed before this Tribunal for the confirmation that the prices of the goods in question in the International Market were equivalent or more to the invoice retrieved from the container. In other words the appellant had submitted all the respective documents about the price negotiated and re-negotiated with the acceptance of the seller of the revised unit value the amount of the price paid for the consignment and the reason for re- negotiated price done well before the appellant filed the GD. The same opinion was held earlier by the Tribunal issued in Customs Appeal Nos. 92 of 2006 Junaid Enterprises v. Collector of Customs (Appeals) and others, K-24/2006 Mushtaq and Company v. Collector of Customs (Appeals) and others and K-263 of 2009 Noman Omar and Co. v. Assistant Collector of Customs MCC of PaCCs.
The order in Customs Appeal No, K-263/2009 was assailed in Customs References Nos. 191 and 192 of 2009 before the High Court of Sindh which dismissed the references in limine while holding that no question of law arise as the Tribunal after examining the fact of the case and the documents available therewith, has given a factual finding that the price actually paid or payable for the goods in question when sold for export to Pakistan was not the price declared in the invoice found in the container, but the price declared in the invoice transmitted along with the Goods Declaration. As such the Issue No,(i) is answered in the affirmative.
9. As regards issue No, (ii), we find that in sub-para (vii) of para 5, the respondent has admitted that the value was determined under section 25(1) i,e, it was a "transaction value" in paragraph 3 of the impugned order, the respondent No, 1 has also held the value determined to be a transaction value under section 25(1). Firstly we find that the respondent's statement as in sub para (vii) of para 5 (counter submission) that "before accepting the value of the invoice (recovered from the containers) the provision of Section 25 of the Customs Act, 1969 and Rule 107(a) of the Customs Rules, 2001 were also taken into consideration is neither corroborated by any evidence nor is legally envisaged in cases where the value is determined under section 25(1). The value under section 25(1) is the transaction value actually paid or payable and the respondent has not been able to contest that the communication exchanged through e-mail about the negotiated price with the foreign seller is untrue, false or bogus. Mere recovery of a document from a container (that too recovered only by virtue of the fact that it was placed prior to re-negotiated prices and the said fact was communicated to the appellant by the shipper in its e-mail dated 2-10-2008), does not negate the price actually paid by the appellant as the shipper ascended his consent through e- mail, which is also a valid document in terms of subsection (kka) of section 2 of Customs Act, 1969.
Since the revised price is the price actually paid, duly accepted by the shipper, this revised price shall constitute the transaction value under section 25(1) of the Customs Act, 1969, unless the transmitted invoice and e-mail are proved to be false or bogus. No such mal-practice having been established in this case. As such the price actually paid by the appellant is accepted to be transaction value under section 25(1) of the Customs Act, 1969 and issue No,(ii) is answered in the affirmative.
10. As Regards, Issue No, (iii). In principle and as per law the prices of the consignment imported against letter of credit are to be termed as transaction value within the meaning of section 25(1) of the Customs Act, 1969. Retrieval of the invoice from the container of the said consignment further substantiates the transaction value and needs not to be disturbed. On the contrary the Customs authorities invariably refuse to accept the said value as transaction value and re-assess the goods under, section 80 read with Rule 438 of Sub-Chapter III of Chapter XXI of the Customs Act, 1969 on the basis of data of assessm ent (instead of import) as envisaged in Rule 110 of the period given in Rule 107(a) of the Customs Rule, 2001 without any cause or reason and in the absence of availability of legal sanction despite of the fact that re-assessment is not warranted in such cases.
The appellant has placed on record complete import documents along with clarification for the confirmation of the said fact as evident from sub para (i) of para 6. No denial to the said fact was given by the respondent and neither veracity of those documents have been challenged. As such Issue No,(iii) is answered in the negative.
11. As regards Issue No, (iv) the declared value of the appellant is compatible with the transaction values of identical/similar goods expressed in subsection (5) of section 25 of the Customs Act, 1969 read with Rules 117 and 118 of the Customs Rules, 2001. The copies of the GDs supplied by the appellant and mentioned at sub-para (viii) of para. 4 of the order, veracity of which has not been challenged by the respondents, rather the stance of the appellant further stood substantiated from the opinion of respondent No, 2 in para 4 of the order dated 1-12-2008, which shows that the lowest declared transaction value of the identical imported goods ranged between US$.350.20 to US$.404.80/MT which had been enhanced from US$.404.80 to US$.535/MT without producing evidence of contemporaneous physical imports of the (90) days valuation data.
Since there can be more than one transaction value for the identical/similar goods, it is not necessary to enhance the value of the identical goods on record in terms of clause (d) of subsection (5) of section 25 of the Customs Act, 1969 which is also applicable mutatis mutandis to subsection (6) of the section 25 ibid. The relevant extract is as under:--
(d) If, in applying the provisions of this subsection, there are two or more transaction values of identical goods that meet all the requirements of this subsection and clauses (b), (d), (e) and (0 of subsection (13), the customs value of the imported goods shall be the lowest such transaction value, adjusted as necessary in accordance with clauses (b) and (c).
Moreover the respondent has not been able to bring on record any cogent evidence or documents of contemporaneous imports of other importers importing the identical goods on the value equivalent or more than the appellant proving that the declared re-negotiated transaction value of the appellant is suppressed/under declared. In the absence of such evidence the enhancement of the value to the level of the highest of transaction value for identical/similar goods on record is not necessitated. The same view stood further substantiated from the reported judgments 2009 PTD (Trib.) 1926, 2010 PTD (Trib) 2432, 2010 PTD (Trib.) 2472 and 2010 PTD (Trib.) 2576 . As such Issue No,(iv) is answered in the affirmative.
12. As regards Issue No,(v) relating to time-bar vehemently contested by the consultant of the appellant, the record presented before this forum indicates that appeal was filed vide Customs- 1106/2008/Paccs on 29-12-2008 and order-in-appeal was issued by respondent No,2 after the expiry of cumulative period of 180 days to be exact the order-in-appeal was issued after 94 days. A letter was written toFederal Board of Revenue for extension by Collector (Appeal) on 5-9-2009 i,e, after (9 months) of the filing of the appeal. The time for deciding the appeal expired on 27-6-2009.
In words of Superior Judicial Fora time extension given in such cases is akin to giving a new lease of life into dead entity. It is tantamount to flogging a dead horse if an event or document has become dead on account of non-timely extension of time period prior to expiry of entire stipulated period. It is legally considered dead and new spirit cannot be infused into it by any means or on account of any reason whatsoever. Following extract from the judgment of the Hon'ble Sindh High Court reported as 2007 PTD 117 is relevant to the merit of this case:-- We are of the considered opinion that once a matter becomes barred by time then the subsequent enhancement in the period of limitation shall not have the effect of reopening the past and closed transaction and resuscitating the matters which attained finality and had gone in the annals of history.
The same principle has been laid down by the Hon'ble Lahore High Court in the case of Messrs Super Asia Muhammad Din Sons (Pvt.) Ltd. v. Collector of Sales Tax Gujranwala and another reported as 2008-PTD 60:--
(i) "Once limitation had started to run and had come to an end the assesse had acquired a vested right of escarpment of assessm ent by lapse of time."
(ii) The claim of the revenue that the prescribed limitation of 45 days from completion of adjudication proceedings as provided through Finance Ordinance, 2000 and enhanced to 90 days by Finance Act, 2003 is merely directory cannot be accepted. It is settled law that where inaction on the part of a public functionary within the prescribed time is likely to affect the rights of a citizen the prescription of time is deemed directory. However, where a public functionary is empowered to create liability against a citizen only within the prescribed time, it is mandatory. The acceptance of contention of the revenue in that regard will make a provision of law redundant and nugatory.
Redundancy or superfluity of an Act of Parliament and a provision of law cannot be readily accepted. All the more so when the prescribed limit is beneficial for the citizen and restricts the executive power to touch the pocket of a tax payer thereby creating threat after its expiry even if there was good case for creation of liability he will not be dragged in."
In the context of not granting extension within initial period of time limit, the Hon'ble apex court in its judgment reported as 1999 SCMR 1881 has observed as under which supports the contention of appellant beyond any iota of doubt:-- " Having said as much, we also do not think that the petitioner's caveat is totally devoid of substance . Thus if initial period of two months, envisaged in S.168 (Supra) is allowed to go by without any extension having been made, a vested right may come to accrue to the affected and Collector should be obliged to issue a notice and accord necessary hearing before granting any extension--- correspondingly as always , it would remain a moot question whether an extension , if any, was actually made within the initial period of two months from the date of seizure and merely because it purports to have been so made within time, may not be in itself be enough the contrary may be shown but, ordinarily within the Customs Jurisdiction alone."
Since the entire period of 180 days stood expired on 27-6-2009, without any extension, the order- in-appeal become barred by limitation period by 94 days rendering it and preceding order as without power/ jurisdiction, hence ab initio null and void and not enforceable under the law. The said ratio was further fortified by the superior Judicial Fora in judgments un-reported/reported viz., Order in Sales Tax Appeal No,K-255/01 (New NO.K-286/04) and K-309/01; 2006 PTD 340 J and PTCL 2005 CL 841, finding/decision in complaint No,958-L/2005, 1998 MLD 650; 2004 PTD (Trib.) 2898, 2004 PTD 369; 2005 PTD 23, 2007 PTD 2092; 2008 PTD 609; 2008 PTD 578; 2009 PTD (Trib.) 1263; 2009 PTD 762; 2010 PTD (Trib.) 23; 2010 PTD (Trib.) 81; 2010 PTD (Trib.) 1146; 2010 PTD (Trib.) 1469; 2010 PTD (Trib.) 1631; 2010 PTD (Trib.) 1636; 2010 PTD (Trib.) 2117. As such Issue No, (v) is answered in affirmative.
13. As regards Issue No, (vi), the consultant for the appellant referred to CR No, I-HC-815094-041108, where contravention in similar nature of case was cancelled by the competent authority and assessm ent was ordered to be made on the basis of scanned prices i,e, the prices available in data in terms of Rule 110 of the period expressed in Rule 107(a) of Customs Rules 2001. On the contrary the appellant has been discriminated by way of preparation of contravention report and subsequently through issuance of show-cause notice and passing of order-in-original. Though both the taxpayers stood on the same pedestal. In rebuttal of the said arguments, the department took the stance that the referred GD is for "Petro Chemical Products" and it has no nexus with the consignment in question and neither to any other consignment of any other goods. The representative also stated that the importer in that case substantiated the prices as re-negotiated.
No evidence was placed on record to substantiate the said stance, nor any authority was placed on record to the confirmation of the said fact that importer can be treated differentially at the whims and wishes of the authorities concerned. The Tribunal also confronted the departmental representative with the observation of respondent No, 2 for taking remedial action in respect of GD relied upon by the appellant. No action has been reportedly taken by the respondent despite a lapse of approx. 18 months from the date of order. Even otherwise a person placed at the same pedestal cannot be treated differently as it would constitute a negation of Articles 4 and 25 of Constitution of Islamic Republic of Pakistan. The honorable High Court of Sindh in its reported judgment 2002 PTD 976 held that "vacating the show-cause notice in one case and taking action against another person in similar situation, is amount to discrimination which is hit by Article 25". In reported judgment 2002 SCMR 312 and 2009 PTD 1507 the Hon'ble Superior courts have observed that "there exists no power to target incidence of tax in such a way that similarly placed person be dealt not only this similarly, but discriminatingly". Whereas, in reported judgment 2005 SCMR 492 the Hon'ble Supreme Court held that "A facility allowed to someone and denied to other is discrimination". The Apex Court further held in reported judgment 2010 SCMR 431 that:- "doctrine of equality, as contained in Art. 25 of the Constitution, enshrine golden rules of Islam and states that every citizen, no matter how high so ever, must be accorded equal treatment with similarly situated persons---State may classify persons and objects for the purpose of legislation and make laws applicable only to persons or objects within a class---In fact all legislations involve some kind of classification whereby some people acquire rights or suffer disabilities whereas others do not---What however, is prohibited under principle of reasonable classification, is legislation favoring some within a class and unduly burdening others---Basic rule for exercise of such discretion and reasonable classification is that all persons placed in similar circumstances must be treated alike and reasonable classification must be based on reasonable grounds in given set of circumstances but the same in any case must not offend spirit of Art. 25 of the Constitution."
The treatment given to the appellant against the principle enshrined in Articles 4 and 25 of the Constitution of Pakistan violate the settled law laid down by the Superior courts in their judgments reported as 1990 SCMR 1072, 1990 SCMR 1059, 1975 SCMR 352, PLD 1995 SC 396, 1998 SCMR 1404, PLD 1997 SC 582, PLD 1997 SC 334 and 1997 SCMR 1874. As such Issue No,(vi) is answered in the affirmative.
14. In view of the foregoing reasons, the order-in-original is based upon proceedings which is infested with patent illegalities and which are held to be null and void ab initio. As such the orders passed by the forums below are based on such proceedings are also ab initio null and void and are therefore, set aside. The subject appeal is accordingly allowed.