HUMAYUN KHAN SIKANDARI, MEMBER (TECHNICAL).---This appeal has been filed by Messrs Shakriullah Shinwari Trading Company, Peshawar (hereinafter called as the appellant) against the Order-in-Appeal No.594 of 2005, dated 29-9-2005, passed by the Collector of Customs, Sales Tax and Federal Excise (Appeals), Peshawar.
2. Precisely, the stated facts of the case as recapitulated from the available case record are that the appellant imported various goods and got the same cleared against various GDs, as per details mentioned below, by furnishing post dated cheques to secure the duty and taxes:-- Statement-A S.No. B/E No. Dated Post Dated Cheque No.Amount
1. 1622/04 27-5-2004 32814805 49200
2. 1600-04 24-5-2004 32814803 5200
3. 1518-04 17-5-2004 32814802 133500
4. 1621-04 27-5-2004 32814806 73500
5. 1019 28-2-2004 3517897 525000 Total 833200 Statement-B S.No. B/E No. Dated Post Dated Cheque No.Amount
1. 01/04 2-7-2004 32814809 1004256
2. 01/04 2-4-2004 32814814 50300
3. 1110/04 25-11-2004 32814822 758457
4. 1159/04 29-11-2004 32814823 825000
5. 1023/04 10-11-2004 32814820 47500
6. 182/04 2-8-2004 34219976 574128
7. 170/04 29-7-2004 32814815 68265
8. 1827/04 29-6-2004 32814808 23000
9. 1832/04 30-6-2004 32814811 705610
10. 1833/04 30-6-2004 32814810 1400000 Total: 5456516 Total (A& B) 6289716
3. Subsequently, the goods were provisionally assessed under section 81 of the Customs Act, 1969 and, the cases were referred to the Customs Valuation, Appraisement Collectorate, Karachi for determination of the value, who finalized the same on the basis of the value ascertained provisionally and advised this office to encash the post dated cheques produced by the party at the time of clearance. The post dated cheques were presented to the Bank concerned for encashment, but the Bank authorities returned the same stating that the demanded amount was not available in the relevant accounts. Accordingly, the Assistant Collector of Customs, Dry-port, Peshawar vide his order dated 13-6-2005 ordered the appellant to deposit the amount of Rs.62,89,716 into the Government Treasury and send the receipted treasury challans to his office within 03 days positively, failing which an action under the relevant provision of the Customs Act, 1969 along with criminal proceedings will be initiated against him.
4. Being aggrieved of the above order dated 13-6-2005, the appellant filed an appeal before the Collector of Customs (Appeals), Peshawar, who vide his Order-in-Appeal No.594 of 2005, dated 29- 9-2005, ordered as under:-- "9. I have examined the case record and considered the written memo. Of appeal, para-were comments of the department. Since no one has appeared on the dates of hearing except 31-8- 2005, the case cannot be kept pending indefinitely. The case is, therefore, decided on the basis of available record. The non-appearance of the appellants also reveals their lack of interest in pursuing the appeal and non-production of any documentary evidence to prove their contentions further establishes the fact that they have nothing to defend the case. Therefore, the appeal being without any merit is dismissed."
5. Being further aggrieved of the impugned Order-in-Appeal, the appellant has filed the instant appeal to this Tribunal, inter alia, on the following grounds:--
(a) that the order passed in Appeal No.594 of 2005, dated 25-6-2005 and assessment made by the adjudicating authority dated 25-10-2005 are illegal, unlawful and of no legal effect hence, untenable;
(b) that the appellant has neither been afforded opportunity of hearing by the Appellate Authority nor any notice was issued to associate with the proceedings initiated under section 79 read with section 179 of the Act;
(c) that the service of appellate order/notice of demand on advocate cannot be considered proper service whereas the law envisages the service of such orders on the person who is liable to pay the duties;
(d) that no speaking order has been passed by the Collector (Appeals), nor any adjudication on merits has been made by the adjudicating authority in his order dated 25-10-2005, therefore, the order is liable to be set aside. The appellate authority admitted that on first hearing, the counsel was present, therefore, it was incumbent upon him to have discussed the merits of the case;
(e) that the adjudication made by the adjudicating officer on 13-6-2005 under section 79 read with section 179 is illegal in excess of jurisdiction and liable to be set aside;
(f) that the assessm ent made is arbitrary, harsh, illegal and unlawful in as much as previously the assessed value was increased nominally with 20% to 30%, which has some rational with the value and quality of the imported consignment; .(g) that the provisions of section 25 of the Act have been altogether ignored illegally and unlawfully while passing order dated 13-6-2005 and 25-10-2005 by the lower authorities and finally determining the value of the goods for home consumption under section 79 read with section 179 of the Act;
(h) that the sample of the imported goods was retained at the time of initial release of the imported goods. Nevertheless, when the matter was referred to Karachi, the sample was never sent to the appraisement department and the assessment has been made only on the basis of information received;
(i) that the class and nature of the imported goods has to be taken into consideration for customs value in terms of section 25 of the Act while finally determining the customs value of the imported goods for payment of duties leviable. Great injustice has been done with the appellant while the matter was considered by the adjudicating officer; Ci) that the appellant was never associated by the appellate authority in the valuation proceedings nor he was confronted with the valuation predetermined by the adjudicating officer; (10 that discrimination done to the appellant is apparent from the record while assessing the customs value of the goods in question. Even the superior qualities of such like goods have been released on the assessed value of 20%/30% above the declared value;
(1) that the examination of the previous data and record when compared to the assessment made now by the respondent will establish the fact that as against declared value of US$ 0.35 and US$ 0.40, it has been assessed harshly at US$ 1.71 and US$ 2.03, which has no comparison with the facts of the case;
(m) that the adjudicating authority cannot sit as a ruler and king to decide the matter at his on whims, wishes, liking and disliking. When the law has provided a method and procedure for the assessm ent of the customs value, the same has to be followed in letter and spirit by the lower authorities;
(n) that even the adjudicating authority can summon the sample drawn by the respondent in the case of the appellant and the other samples which were previously released on normal increase of 20% to 30% of the declared value;
(o) that another important aspect of the matter has not been taken into consideration by the lower authority that each consignment has its on design, style and quality, which cannot be compared with the quantity and quality assessed with regard to other goods;
(p) that it has been alleged by the adjudicating authority that the matter was referred to the Customs Valuation, Appraisement Collectorate, Karachi for the determination of the value and it has finalized the cases on the basis of value ascertained provisionally. It is established that the sample drawn at the time of provisional release was never sent to the Valuation Authorities, Appraisement Collectorater Karachi, therefore, no reliance, whatsoever, can be placed on one sided assessed value;
(q) that the value assessed cannot be the price actually paid and payable for the goods when sold for export to Pakistan. The price is by imagination even the market value in Pakistan; and
(r) that looking from all aspect of the case, it is abundantly established on the record that the assessm ent and valuation of the imported goods in question of porcelain were crockery is harsh, illegal, unlawful and not sustainable.
6. On the last date of hearing fixed for 20-10-2009, the learned counsel for the appellant and the appellant-in-person appeared and almost reiterated the same arguments as advanced in the memo. Of appeal. On the contrary, the Departmental Representative reiterated his earlier oral arguments. However, no written arguments to the grounds of appeal have so far been furnished by him as evident from the perusal of the available case record.
7. We have keenly perused the available case record with the assistance of the learned counsel for the appellant and the Departmental Representative and have also anxiously considered their oral submissions made before this forum, we observe that in this case, the crockery imported by Messrs Shakirullah Shinwari was provisionally assessed and the differential amount of duty/taxes of Rs.6,289,716 was secured through post dated cheques. Upon receipt of the valuation criteria determined by the Controller of Valuation, the assessment was finalized vide dated 9-6-2005, accordingly. 'Upon failure of the importer to pay the demanded differential amount, the post dated cheques were presented to the concerned bank for encashment. The bank, however, failed to honour the cheques due to insufficient amount in the relevant account. Resultantly, the case was referred to the Recovery Officer vide reference dated 18-10-2006 (placed on record) for initiating recovery proceedings. Accordingly, a warrant of attachment was issued vide reference dated 5-4- 2007 (placed on record). The clearing agent Messrs Rehbar Customs Agency, however, reported that the actual stakeholder/importer is dead.
8. During the course of hearing dated 3-6-2009, the learned counsel for the appellant argued that the actual beneficiary/importer was Mr. Abidullah Jan son of Mirza Khan, who had since expired, thereafter the Tribunal directed as under:-- "The respondent department is directed to probe further into the matter and unearh the actual beneficiary(its). Of the import consignments involved in this case as the appellant has vehemently stated that he was not the main beneficiary of the import consignments and his license was misused by somebody else."
9. Since the then Superintendent (Imports) was well versed with the case, so, he was advised by the respondent-department to probe into the matter and furnish his report in this regard at the earliest for onward submission to the Tribunal, as directed above. Consequently, the said Superintendent furnished him report dated 18-8-2009 (placed on record), contents whereof are reproduced below in verbatim:-- "(2) As per prevailing practice, GD is presented to the Customs authorities for clearance of imported goods by the authorized License holder (Customs Clearing Agent) on behalf of the importer. In the instant case, Messrs Rehbar Customs Agency filed the relevant GDs on behalf of the importer Messrs Shakirullah Shinwari. However, to ascertain the real beneficiary, the concerned clearing agent was approached dated 25-6-2009.
(3) The clearing agent has reported on 29-6-2009, that Messrs Shakirullah Shinwari the importer of consignments contacted him for clearance of the consignments, being registered person and license holder of import and export, therefore, the clearances were accepted. Furthermore; Mr. Shakirullah authorized Mr. Abidullah Jan as his authorized representative to act on his behalf for clearance of the consignments through the clearing agent.
(4) The Post Dated Cheques covering the differential amount of duty and taxes at the time of clearance maintained account No.103176-2 and 103275-6 issued by the United Bank Limited, Shoba Bazar Branch, Peshawar, therefore, the concerned Manager of the Bank was also requested to intimate the title and statement of accounts vide dated 25-6-2009 and 3-7-2009.
(5) The Manager of UBL in his letters dated 30-6-2009 and 21-7-2009 has certified that Mr. Shakirullah no H.No.29, St.No.2, Sector D/1, Phase-1, Hayatabad, Peshawar maintained his account No.010-3176-2 in his personal name on 18-5-2004. Similarly, a Post Dated Cheque No.A-3517897 dated 1-4-2005 amounting to Rs.525,000 was furnished against the differential amount of duty and taxes issued by the National Bank of Pakistan, Hayatabad, Peshawar. The Manager, of the concerned, Bank was also requested vide dated 3-7-2009 to intimate the title and statement of account. The Manager of the Bank vide dated 6-7-2009 also confirmed that the account was operated by the said Mr. Shakirultah son of Hazratullah H.No.29, Sector D/1, Phase-I, Hayatabad, Peshawar.
(6) Apart from above, the perusal of record indicates that the Import License holder is Shakirullah Shinwari, the NTN and Sales Tax Registration is also in his name. Moreover, the replies of clearing agent and concerned Banks also confirmed that Mr. Shakirullah Shinwari was the actual beneficiary irrespective of the fact as to whether the consignments have directly been cleared by the said Mr. Shakirullah Shinwari or his authorized representative."
10. Upon receipt of the above report from the respondent-department, the following short orders were issued on 18-8-2008 by this Tribunal:-- "The departmental representative of the customs department is directed to get the Death Certificate of Abidullah Jan son of Mirza Khan verified from Landi Kotal Hospital as to whether the same is genuine or otherwise. He is further directed to contact Political Agent, Khyber Agency to clarify and ascertain the position as to whether Mr. Abiduliah Jan is alive or otherwise. The learned Collector of Customs, Peshawar should constitute a committee to probe further into the matter by also ascertaining whether the Clearing Agent in the case was authorized by Shakirullah Shinwari in writing or otherwise, besides to ascertain the position regarding Bank Account of Shakirullah Jan, Importer/Exporter as to whether the same is being still operated or otherwise. The report of the Collector Customs, Peshawar should roach this Tribunal within 15 days. The case is adjourned to 29-9-2009."
11. In response to the above short orders dated 18-8-2009 of the Division Bench of this Tribunal, the compliance thereof was reported by the respondent-department, Contents whereof are reproduced below in verbatim:-- "(i) The death certificate of Mr. Abidullah son of Mirza Klan has been verified by the Medical Superintendent, Agency Headquarters Hospital, Landi Kotal vide his Letter No.1355/PV dated 31-8- 2009.
(ii) The Political Agent, Khyber Agency, vide his report dated 1-9-2009, has confirmed that Mr. Abidullah son of Mirza Khan Shinwari is dead.
(i.e) The Manager, United Bank Limited, Shoba Bazar Branch, Peshawar has reported vide his letter dated 21-7-2009 that the account of Shakirullah Shinwari stands closed. Similarly, the Manager, National Bank of Pakistan, Hayatabad Branch, Peshawar vide his letter dated 1-9-2009, provided a copy of bank statement in respect of Mr. Shakirullah Shinwari with effect from 1-1-2004 to 20-8- 2009. The bank statement reflects that the last transaction amounting to Rs.15,500 in the account was done on 23-2-2005. The statement further suggests that there is no amount in the credit of the said Mr. Shakirullah Shinwari as on 20-8-2009.
(iv) A Committee constituted by the Collectorate on 25-8-2009, vide their report dated 1-9-2009, has concluded that there is no such practice that every importer authorizes his clearing agent in writing, rather delivery of import documents by the importer to any of the clearing agent for clearance of imported consignment means that the importer has authorized the clearing agent. In the instant case, the importer also handed over the import documents to the respective clearing agents for filing of GD on his behalf. "
12. On the last date of hearing, the appellant also appeared in-person along with the learned counsel. Likewise, the Departmental Representative along with Mr. Gul Said, D.S. And Ziaullah, Appraiser and Mr. Arooj Ahmad Ansari, Proprietor of Messrs Rehbar Customs Agency also appeared. The Appraiser and D.S. Concerned stated that consignments were released against post dated cheques, which were furnished by the appellant himself and the same post dated cheques were kept in safe custody till decision of the valuation dispute by the D.G. Customs Valuation, Karachi. They stated that when the post dated cheques were sent to the concerned bank, the same were not honored due to less amount in the respective accounts being operated by the appellant. To a query as to why prosecution was not launched against the appellant for his such criminal act as aforesaid, as also indicated in the demand notice dated 13-6-2005, issued by the Assistant Collector of Customs, Dryport, Peshawar, indicating therein that criminal proceedings will be initiated against the appellant in case of his failure to deposit the outstanding amount in the government treasury, the D.R. And the other concerned officers of the Collectorate could not respond properly. To another question, whether the appellant personally or through his clearing agent delivered the post dated cheques and other custom documents, the D.S. Responded that the appellant was physically present along with his clearing agent at the time of clearance of his consignments and he also deposited the post dated cheques and thereafter, the subject consignments were released pending finalization of valuation dispute. However, the appellant, who appeared in person vehemently controverted the averments by the customs staff and the clearing agent k and stated that he is ready to state on oath that he never met the customs staff concerned and the said custom agent and he never operated the said accounts, which are alleged to be in his name. He stated that such accounts might have been opened and operated by his uncle (who has already expired) and he must have introduced the original beneficiary to the customs and the concerned clearing agent. To another question, he Mated that, he only engaged the counsel for appearance before the Tribunal on insistence of one Shahzad Gul of Khyber Agency, who deals in transit goods. He reiterated time and again that he never appeared before the concerned customs staff at the Customs Dryport, Peshawar, at the time of clearance of the impugned consignments nor introduced his uncle to the concerned custom clearing agent and these are all fabricated and concocted statements by them. This Tribunal could have brought further admissible evidence on record, however, such steps were not initiated, as the matter required further probe by the respondent department to safeguard the government revenue, by also unearthing the actual beneficiary(its) in this case.
13. In view of the above deliberations, we are inclined to accept the instant appeal and remand the case back to the original adjudicating authority to decide it afresh, by providing an ample opportunity of hearing to all concerned and by deducing admissible evidence, if any, to be provided by either side and then pass a speaking and judicious order, by also taking into consideration all the issues raised by the appellant, as also reproduced in para 5 above, and by also taking into consideration the proceedings before this Tribunal, which took place on the last date of hearing, as reproduced in para 12 above. The instant appeal, thus, stands disposed of accordingly, in the aforesaid manner. . revisions by the competent authorities. Therefore, it is advisable to consult the official sources or legal professionals for the most up-to-date and accurate information.