FINDINGS/RECOMMENDATIONS DR. MUHAMMAD SHOAIB SUDDLE (FEDERAL TAX OMBUDSMAN).---This complaint has been filed alleging maladministration through misrepresentation of facts about Mercedes Benz car auctioned by the Model Customs Collectorate, Lahore.
2. The Model Customs Collectorate, Lahore, offered Mercedes Benz, 1998 model, for auction.
According to auction documents, the vehicle presented for auction was of 1998 model. According to the complainant, the auctioneer at the time of auction also announced that the vehicle was Mercedes Benz of 1998 model. The complainant took part in the auction, believing the declaration of the Department in auction documents and the announcement made by the auctioneer. The complainant was highest bidder, and he took possession of the vehicle after payment of bid money on 19-3-2011. The delivery order dated 19-3-2011 issued by the auctioneer on behalf of the Department also indicated the description of the vehicle as Mercedes Benz of 1998 model.
3. As the vehicle was not in running condition, it was taken to the . workshop for necessary repair. The motor mechanic after examination suspected that the vehicle was not of 1998 model. The car was then taken to the workshop of authorized dealer of Mercedes Benz, who ascertained that it was actually of 1992 model.
4. The complainant approached the Department for cancellation of bid and return of bid money vide application dated 22-6-2011. As no action was taken, he filed complaint alleging maladministration.
5. The complaint was sent to the Revenue Division for comments in terms of section 10(4) of the FTO Ordinance, 2000. The Collector Model Customs Collectorate Lahore in his comments received through the Revenue Division stated that the complainant obtained possession of the car after depositing full auction amount. The Department auctioned the vehicle on "as is where is basis under Rule 65(ii) of the Customs Rules 2001. Sufficient time was given to the buyers to inspect the vehicles and find out model and other attributes before auction. The model of the .Vehicle was determined by its shape and the seat belts which in this case had been removed by the person from whose possession the vehicle was seized. It was further stated that the complainant submitted application for cancellation of auction after a lapse of two months of taking delivery of the vehicle. The auction proceedings after delivery of auctioned lot could be cancelled by the Collector only in cases where it was found that deliberate attempt had been made to cause loss to the public exchequer.
6. During the course of hearing, both the parties reiterated their arguments as contained in the complaint and comments received from the F.B.R. At the time of auction, the auctioneer presented the vehicle as Mercedes Benz of 1998 model. The delivery order dated 19-3-2011 issued by the auctioneer in favour of the buyer on behalf of the Department also indicated the vehicle to be of 1998 model. The complainant on the pointation of motor mechanic got the vehicle inspected from the local dealer for correct determination of model. The local dealer, after inspection, declared the vehicle as Mercedes Benz of 1992 model. The complainant was obviously led to by the vehicle due to the wrong information made available to him by the Department and the auctioneer.
7. While in terms of Rule 65(ii) of the Customs Rules 2001, the goods are auctioned on, "as is where is" basis the Department is nevertheless required to provide the correct "details of goods" to the prospective purchaser in terms of Rule 65(i). Section 20 of the Contract Act, 1872 also provides that where both parties are under a mistake as to a matter of fact, the agreement is void. Delivery alone is not of the essence.
Findings:--
8. Irrespective of the fides of the Department, the complainant, a bona fide purchaser has suffered a loss because of the wrong information provided by the Department. Where there is a wrong, there is a remedy: The complainant's grievance has to be redressed. The Department's resistance to reverse a process which is so patently unfair and unjust is tantamount to maladministration as defined under section 2(3)(i)(b) of the FTO Ordinance, 2000.
Recommendations:
9. F.B.R. To-
(i) cancel the auction;
(ii) refund the full auction amount after retrieval of the vehicle; and (i.e) report compliance within 30 days.
C.M.A./268/FTO .