' GHULAM AHMED, MEMBER (TECHNICAL-II).---The appeal, filed by the appellant, is directed against Order-in-Appeal No,5738 of 2011 dated 27-8-2011 passed by the Collector of Customs (Appeals), Karachi maintaining the Order-in-Original No, 1 of 2011 dated 10-1-2011 passed by the Additional Collector of Customs, (Adjudication) , Model Customs Collectorate of PaCCS, Custom House, Karachi.
2. Brief, facts of the case as stated in the impugned order are that the Karachi office of the Directorate of Intelligence and Investigation-FBR (hereinafter the Directorate General) reported to have unearthed unlawful removal of 9901 packages/cartons/cases of imported goods such as Food staff, electronic goods etc. From Qasim International Container Terminal (QICT) by a syndicate of fraudsters in connivance with the management of QICT. As per details provided in the impugned order the syndicate consisted of Naeem Qureshi, Faisal Shahzad, Jammal Durrani, Shakoor Alam, Aslam Niazi various importers such as the appellant in whose name the 'above mentioned goods had been imported other conspirators/purchasers of the stolen/illegally removed goods and certain Customs/PRAL officials. During the interrogation by the staff of the Directorate General the main accused persons i,e, Naeem Qureshi, Faisal Shahzad and Jamal Durrani disclosed the details of how the persons/ entities named above had conspired and connived with each other in unlawful removal of the goods from the port premises by depriving the Exchequer of its legitimate revenue in duty/taxes to the tune of tens of millions of rupees. All the culprits including the appellant were accordingly charged through various show cause notices, under the relevant provisions of, the Customs Act, 1969 (hereinafter the Act). The respondent No, 1, after taking into consideration the explanations submitted by the appellant and the Directorate General's comments thereon held vide the impugned order that the charges against the appellant stood established. He passed the impugned order in respect of Show-cause Notice No, MCC /SCN- 13/Cont, Appg-11/34-A/KHI/A DJ / PaCCS/2010 dated 10-1-2011 and applied the same mutatis mutandis to the other show cause notices. He imposed a penalty of Rs,26.0 millions on the appellant. The part of the impugned order relating to the appellant and other importers is reproduced as under:-- "The Directorate General, Intelligence and Investigation-FBR, Regional Office, Karachi also made out thirty other identical cases, in which the facts are identical and the respondents are mostly the same except that importers/consignees are different in different cases. Replies from some of the importers were received such as Messrs Al-Qutab Enterprises, Messrs Chaudhry Brothers and Co.
And Hafiz Brothers and Co. These importers deny any link with goods in question and maintain that the goods in question were not imported by them and their names have been used by other importers or clearing agents. However, it is observed that these importers have been charged in these cases on the basis of documents such as invoices, bills of lading, goods declarations and delivery orders etc., which bear their names. Thus, these importers cannot be alienated from these cases and the charges against them are established and they are liable to be penalized under clauses 1, 9, 14, 14A, 43, 47, 63, 77, 86, and 90 of section 156(1) of the Customs Act, 1969. In some of the cases becomes other persons who have been established as actual importers as they carried out the negotiation or booked the goods. These persons mentioned at sub-serial 4 of each of Serial Nos. 4,10 and 23 and sub-serial 5 of each of S. Nos. 21 and 30 of the table below, have also been established as importers and penalized under aforesaid provisions. This order therefore, also applies mutatis mutandis to all these thirty cases being identical in nature and involving identical roles and findings in respect all the respondents, with penalty being imposed under this order."
3. The appellant against Order-in-Original No, 1 of 2011 dated 10-1-2011 filed an appeal before the learned Collector of Customs (Appeals), Karachi who disposed it vide order dated 27-8-2011, the operative Para 7 of the impugned order read as under:- "I have thoroughly examined the entire case record and have given very careful consideration to the arguments advanced before me. In terms of the provisions of law contained in section 195-B of the Act, the Collector (Appeals) is not allowed to proceed with an appeal unless the appellant deposit the adjudged amount of duty/taxes and/or penalty or the Collector (Appeals) himself dispense with such deposit. The aforesaid provisions of law are reproduced as under:-- "195-B Deposit, pending appeal of duty demanded or penalty levied.---Where in any appeal under this Chapter, the decision or order appealed against relates to any duty demanded in respect of goods which are not under the control of the customs authorities or any penalty levied under this Act, the person desirous of appealing against such decision or order shall, pending the appeal deposit with the proper officer the duty demanded or the penalty levied.
[Provided that where in any particular case the Collector (Appeals) or the Appellate Tribunal is of the opinion that the deposit of duty demanded or penalty levied would cause undue hardship to such person, the Collector (Appeals) or, as the case may be, the Appellate Tribunal may dispense with such deposit subject to such condition as he or it, may deem fit to impose so as to safeguard the interest of revenue.] [Provided further that an order dispensing with such deposit shall without effecting the appeal, cease to have effect on the expiration of a period of six months following the day on which it is made unless the appeal is finally decided earlier and nothing in the order dispensing with such deposit which has ceased to have effect shall debar the appropriate officer to recover the amount of the duty demanded or penalty levied.] ' It is thus, clear that deposit of the adjudged amount of duty/taxes as well as penalty is a mandatory condition for proceeding further with an appeal unless the deposit of duty/taxes and/or penalty is dispensed with by the Collector (Appeals) himself in terms of the first proviso to section 195-B of the Act. In turn, the Collector (Appeals) can dispense with such deposit only when there exists a strong reason for the same. In the instant case, however, no such reason exists there is strong documentary evidence on record to the effect that the impugned goods involving millions of rupees in duty/taxes which had been illegally removed from the port by employing fraudulent means had been actually imported by the appellant. Moreover, the appellant had not joined investigation despite a number of summons issued to him by the Director General, therefore, there is no doubt that the appellant has come with unclean hands. Under the circumstances, I rule that there is no justification for dispensing with the deposit of the adjudged penalty amount of Rs,26.00 millions imposed on the appellant. In fact any such a dispensation would be unfair to the Exchequer and would tantamount to encouraging fraudsters. I therefore, reject the appeals for non-compliance of the provisions of section 195-B of the Act."
4. The appellant has now challenged the above order by way of this appeal on the strength of ground; taken in the memo of appeal reading inter alia:-- ' The respondent No, 2 in order dated 27-8-2011 failed to distinguish or discuss the law including citation, instead made academic discussion of personal nature in regard to fiscal statute, which is not sustainable in comparison to the Law and the judgments of Hon'ble superior Courts of Pakistan.
Hence he erred in passing the order and it is not sustainable in law as this is 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:--
(i) That as discussed in para 10 of the facts that on both the dates i,e, 26-3-2011 and 14-4-2011 of hearing, none of the officials of DG (I&I)-FBR appeared for hearing on the given time and in regard to the date of hearing para 3 of order is relevant. Resultantly, the hearing was adjourned and the Investigating Officer handed over his comments in the passage of the office of respondent No, 2 on 14-4-2011. Subsequent to that no hearing date was fixed as no communication was received by the appellant consultant. Resultant, the hearing date i,e, 13-5-2011 mentioned in the first page of order is being inserted by the respondent No, 2 himself. Hence, the question of arguments incorporated in para 5 does not arise at all and this stood re-verified from the comments of DG (I&I)-FBR on grounds of appeal and additional grounds of appellant which are silent in this regard, reference is made to para 4 of order-in-appeal. It seems that hearing on 13-5-2011 has been fixed by the respondent No, 2 in file only without intimation to the appellant and only officers of DG (I&I)-FBR were called by the respondent No, 2 for submitting the dictated arguments as per the will of respondent No,
2. Confirming that the arguments incorporated in para 5 by the respondent No, 2 himself for obtaining tool for rejecting the appeal despite merit allowing on the basis of grounds of memo. Of appeal and rejoinder submission/arguments. The said act of respondent 2 renders the order-in-appeal based on mala fide and intellectual dishonesty, hence ab inito, null and void.
(ii) That taking refuge under the provision of section 195-B of the Customs Act, 1969 for rejecting the appeal by the respondent No,2 is manifestly erroneous , misconceived, illegal and above all discriminatory as the said provision of the Act empowers him to dispense with the deposit of imposed penalty for the sake of justice and fair-play and mitigating the caused undue hardship to such appellant, irrespective of its expression, which read as "the person desirous of appearing against such decision or order against an issue or a matter wherein goods are not under control of customs authority shall pending the appeal deposit with the proper officer the duty demanded or penalty levied".
(iii) That even otherwise if the person is not desirous of depositing the adjudged amount of duty or imposed penalty, he is not barred under section 193 of the Customs Act, 1969 and neither the Appellate Authority from hearing the appeal for issuance of decision on merit as the right of appeal granted to an aggrieved person against any decision or order passed under the provision of law as mentioned therein by customs officer within 30 days under the proviso of section 193(1) of the Customs Act, 1969. The right of appeal is an in-alienable right guaranteed under the Constitution of Islamic Republic of Pakistan and cannot be made ineffective/redundant on account of non- deposit and the Collector (Appeal) is bound to grant opportunity of personal hearing to the parties to the appeal in terms of subsection (2) of section 193-A and then pass an order "as he thinks fit to confirm, modify or annul the decision or order appealed against in terms of Subsection (3) of Section 193-A ibid. The prerequisite for passing "such an order as he thinks fit" is only "after giving both parties to the appeal an opportunity of being heard",
(iv) The provision of section 195-B of the Customs- Act, 1969 is synonymous to the provision of pre- revised subsection (4) of section 45-B of the Sales Tax Act, 1990, so as far as it relates to deposit of adjudged amount before presenting appeal and it is directory in nature and not mandatory.
Hence, on the basis of non-deposit of the adjudged amount, the appeal cannot be dismissed straight away as it is nullity of Quran and Sunnah and Constitution of Islamic Republic of Pakistan, 1973. No consequence has been laid down in section 195-B regarding the fate of appeal, in case of non deposit of adjudged amount thus it cannot be taken that non-deposit would automatically mean rejection of appeal in "Limine". The same view has been taken by the Customs, Excise and Sales Tax Appellate Tribunal in its reported judgment 1993 CLC 1405, 2005 PTD (Trib.) 731 Messrs Bilal Fabric Ltd. And 9 others v. Collector of Customs, Excise and Sales Tax and Hon'ble High Court vide its judgment dated 10-4-1993 Writ Petition No, 1058 of 1993 titled as Messrs Meaple Leaf Cement Factory, 1993 MLD 1645; PTCL 1993 CL 686(sic), 1993 CLC 1405. Beside disposing appeal on the said basis is contravention to the Article 10A of the Constitution of Islamic Republic of Pakistan.
Beside the order of the respondent No, 2 deprived the appellant from fair trial despite mandated under Article 10A of the Constitution of Islamic Republic of Pakistan.
(v) That from the referred in above commentary, it is confirmed without any ambiguity that the condition laid down in section 195-B is directory in nature and not mandatory. Hence, the respondent No, 2 was under obligation to ignore the provision of section 195-B of the Customs Act, 1969, which he does invariably in umpteenth order passed/issued by him, even otherwise, the provision has no binding force and least debar the Appellate Authority/Tribunal to dismiss the appeal on the pretext of non-deposit of imposed penalty as it defeats the injunction of Quran and Sunnah and the Articles of Constitution of Islamic Republic of Pakistan, 1973 and settled proposition of law by the judicial forums.
(vi) That line 5 of para 1 of show cause notice itself proves the innocence of the appellant that he has no nexuses with the import of the impugned consignment as it reads as "12x40" containers from Port Muhammad Bin Qasim (instead of MCC of PaCCS against fake and fictitious goods declaration without payment of duties and taxes levied thereon" and lines 43, 44 and 45 of the said para, "wherein Collector, Collectorate of Port Muhammad Bin Qasim vide letter C.No,SI/MISC/15/2007/PQ-imports dated 15-11-2007 intimated that the clearance of containerized cargo is dealt with by Model Customs Collectorate of PaCCS" meaning thereby that nobody including the appellant can obtain clearance of containerized cargo unless he/they file online GD under Rule 433 of Sub-Chapter-II of Chapter XXI of the Customs Rules, 2001 with MCC of PaCCS and neither the GDs referred in the show cause notice has undergone the procedure prescribed in Rules 437 to 442 ibid. Whereas, against the said impugned containers the appellant had not filed any online GDs with the MCC of PaCCS, hence' allegations in regards to getting those cleared without following the laid down procedure is out of question as neither Shipping Company issues delivery order and nor Terminal effect the deliveries in the absence of transmitted clearance message as per the expression of clause (ii) of Sub-Rule (c) of Rule '556 of Sub-Chapter XIV Custom Rules, 2001.
Resultant, the allegation levelled in the impugned show cause notice are without any substance as these are not supported with incriminating evidence confirming in material particular involvement of appellant.
(vii) The line 9 of para 2 also states that "no Gate out, even took place against the listed index No, GDs were filed and processed against the same". For filing online GD neither IGM No, nor index No, is required, rather are filed after filing of VIR online with PaCCS by the shipping companies. When no online GDs were filed by the appellant and no clearance message under section 83 of the Customs Act, 1969 and Rule 442 of Sub-Chapter. III of Chapter XXI of Customs Rules, 2001 were transmitted to appellant, the question of gate out least exist. The said fact further stood substantiated from line 67 of para 2 which states "against fake and fictitious goods declaration through Messrs N.J.
International CHAL 2392, Karachi and Messrs Durrani Traders." These two names are alien to the appellant and the said fact further stood substantiated from line 93 of the said para reading as "accused Faisal Shahzad and Naeem Qureshi arranged the phony and dubious firms of Lahore" which carries the address of some Ayesha Heights in lines 234 and 235 of para.2 reading as "the inhabitant of the locality has not identified the Ayesha Heights in the locality. Therefore the firm is bogus with fictitious address". To the contrary the appellant company is neither phony non dubious rather legally registered company as is evident from NTN/STR Certificates and issuance of User ID by the MCC of PaCCS and operates at 214, Qadri Chamber, 5 Mcload Road, Lahore.
(viii) The emphasis laid upon by the Investigating Officer in the comments are that the applicant should own the consignments, which he has not imported and in regards to the reason for non- appearance is also given in the reply to the notice. Despite of non-appearance by the appellant, his representative appeared before the Investigating Officer and submitted all the relevant documents listed at Serial Nos. 3(i), (ii), (iii), (iv) of notice corresponding to appellant imports, excluding the impugned consignments as evident from letter dated 22-8-2008. With the appearance of appellant representative and submission of documents, the stance of non- appearance of appellant stood nullified.
(ix) That till the time of filling F.I.R., Interim/Supplementary and Final -Challans the Investigating Officer has not implicated the appellant by name despite of the fact the agency was supplied with the copies of NTN and Sales Tax Registration Certificate by the appellant as evident from Exhibit " C & D" of the memo. Of appeal, this was done due to the reason that the agency was for the simple reason that the agency was well aware of the fact that the company which imported the impugned containers was not infact owned by the appellant instead was fake and phony firms made on papers for fulfillment of their malicious design by the accused listed at Serial No, 1 of F.I.R./Interim/ Supplementary and Final Challan along with his accomplices listed at Serial Nos. (ii) to (xv) of F.I.R. And Serial Nos.(ii) to (xiii) of final challan and for that reason the agency has not shown the applicant in the final challan under any category i,e, even "Absconder" either by his name or his company.
(x) That the stance of the appellant stood validated if the Hon'ble Tribunal peruses the final challan submitted in the Hon'ble Court of Special Judge (Customs and Taxation) Karachi on 2-7-2009, the name of appellant or his company appears nowhere. Instead the F.I.R., interim, supplementary at relevant paras and Para 10.26 of the final challan with clarity states that "accused Minhaj Ali further disclosed that during the month of March 2007 accused Zahid Islam Afridi approached him and delivered two bills of Lading No, 512188282 and 854013643, in respect of 02x40 ft container Nos. MSKU9940850 and MSKU9183989 imported by Messrs Al-Qutub Enterprises, Lahore and asked to deposit securities with concerned shipping lines through Bank pay order and get the delivery orders and gate passes from Messrs Maersk Pakistan (Pvt.) Ltd., Karachi. In response accused (Minhaj Ali) deposited securities vide pay Order No, 1822760 against aforesaid 2 containers, issued by Messrs Bank Al-Habib Ltd. Karachi, Karachi, and received Delivery orders and gate passes from the aforesaid shipping lines which he handed over to Zahid Islam Afridi.
(xi) The challan further states at Para 10.27 that During the interrogation accused Zahid Islam Afridi, disclosed that he is proprietor of Messrs Azad Afridi Goods Transport Company, situated at Hawksbay Road, Karachi. Four years back he established business terms with accused Muhammad Naeem Qureshi, when he was providing his transport company's services to Messrs Imex International Logistics, Islamabad who was clearing containerized cargo for NATO Forces based at Afghanistan through accused Muhammad Naeem Qureshi, who at that time was representative of Messrs Imex International Logistics, Islamabad at Karachi. During that period accused Muhammad Naeem Qureshi started his commercial import also and in connection with the import of 12 containers imported in the name of style of Messrs Al-Qutub Enterprises, Lahore accused Muhammad Naeem Qureshi delivered him two original bills of lading at his office situated at 1- Marium Palace, Bohri Road, Opposite Customs House, Karachi which he delivered to accused Minhaj Ali for deposit of securities and subsequent issuance of Delivery orders and Gate passes, from the concerned shipping lines which were subsequently given to him (Zahid Islam Afridi), upon receipt of these Delivery Orders and Gate Passes from accused Minhaj Ali he delivered the same to accused Muhammad Naeem Qureshi. After that Muhammad Naeem Qureshi arranged the clearance and transportation of these containers from QICT to a private container yard namely Z.K.
Niazi Container Yard situated at Hawksbay Road, Maripur Road, Karachi to further transport these containers to Lahore, accused Muhammad Naeem Qureshi contacted accused Zahid Islam Afridi and on his instructions he transported these containers at the required destinations at Lahore, as told by accused Muhammad Naeem Qureshi and the transportation charges of these containers were paid to accused Zahid Islam Afridi by accused Muhammad Naeem Qureshi.
(xii) That there is nothing in the challan whether the impugned containers were actually transported to Lahore for delivery to the appellant as alleged. The agency is well aware of the fact that the containers never ever were transported to Lahore, instead were disposed off at Karachi, if the containers would had transported to Lahore and were delivered to the appellant company addressee. What stopped the agency for not incorporating the said fact in the challan. The agency in fact is shooting in the dark and trying to implicate the appellant by hook and by crook in the crime, which he has not committed. The fake and phony company Messrs Al-Qutab Enterprises which imported the impugned containers were not the appellant company as the same was not operating at 214, Qadri Chamber 5 Mecload Road, Lahore instead at Ayesha Heights, and the said fact proves from the last two fines of Para 10.23 of the Final Challan reading as "the inhabitant of the locality has not identified the Ayesha Heights in the locality therefore, the firm is bogus with fictitious address".
(xiii) That it is appropriate for the appellant to add further that after hearing on 14-4-2011 before the Appellate Authority the Investigating Officer forwarded a call notice dated 21-4-2011 to the appellant despite not warranted under the law as its amounts to mala fide to issue the said call notice at this belated stage. It is interesting to note from notice that the Investigating Officer once again asked the appellant to bring all relevant documents (in original) in connection with the subject) case, instead of communicating and forwarding copies of CR Nos. Through which the consignment in question were allowed clearance by the PaCCS in terms of sections 80 and 83 of the Customs Act, 1969 read with Rules 438 and 442 of Sub-Chapter III of Chapter XXI of the Customs Rules, 2001.
(xiv) That since the call notice was devoid of legal infirmity the appellant forwarded reply to the Investigating Officer vide letter dated 29-4-2011 with the request to supply incriminating documents relied upon i,e, copies of CANs showing his company NTN and STRN for the confirmation that the clearance of the impugned container were obtained by the appellant. In the absence of compliance of the mandated requirement of law, the Investigating Officer was advised to first find out some material from the documents available with him corresponding to the subject containers or the statements of the accused persons pointing finger at the appellant and then approach him with the pointation of irregularity or illegality. Law does not permit him for making indiscriminate, roving or fishing inquiries irrespective of the facts whether any determination of legalities or illegalities in import made by appellant documents of which has already been supplied to the agency As regards the imported containers of the F.I.R./Show Cause Notice, these were not imported by the appellant and as such he is not answerable for the legality or illegality of those.
The Investigating Officer was also forewarned through not to forward such type of letter of personal appearance even in case of suspicion of commissior of illegality without providing the relevant documents, as it is in violation of principal of natural justice and law laid down by the Hon'ble Supreme Court of Pakistan in its reported judgment PLD 1992 Supreme Court 485 (Assistant Director Intelligence and Investigation, Karachi v. B.R. Herman Mohatas Ltd. Karachi).
(xv) That since appellant is not the person who imported the impugned consignments and the said fact stood proved from the contents of F.I.R., interim/supplementary/final challan, show cause notice and order-in-original passed by the respondent No,1 stating without any ambiguity that clearance of the impugned containers were obtained by Mr. Naeem Qureshi in connivance with Razzak Dino Jokhio, Zahid Aslam Islam Afridi, Faisal Shazad, Jamal Durrani, Naila Jamal Shakoor Alam Babar Hussain, Farhan Ibrahim. Nevertheless, if the respondent still felt that the appellant is guilty of mis-declaration. The onus of ultimate proof of burden under Qanun-e-Shahadat (10 of 1984) Arts. 121 and 117 stood shifted on his part to prove that the appellant is in fact lawful importer of the impugned consignment as against bogus/phony firms operated by bunch of unscrupulous persons listed above, despite their admission as per laid down law by the superior Courts of Pakistan namely S.M. Anwar Sethi v. South British Insurance Company Ltd. PLD 1975 Kar. 458; Barkat Ali v. The State PLD 1973 Kar. 659; Cross on evidence 1967, 3rd Edn., London Butterworth; A Practical Approach to Evidence by Peter Murphy 1986 3rd Edn. London, Black Stone Press Ltd; The Modern Law of evidence by Adrian Kean 1985, 1st Den. Oxford , Professional Books Ltd.; Mst. Safia Begum v. Mst.
Malkani and another PLD 1965 Lah. 576; Akber Ali v. Ehsan Ellahi PLD 1980 Lah. 145; Government of Pakistan v. Moulvi Ahmed Saeed 1983 CLC 414; Muhammad Sarwar v. Fazal Rehman 1982 CLC 1286; Sardar Ghulam Nabi Khan v. Azad Government of State of Jammu and Kashmir 1984 CLC 325; Eastern Rice Syndicates v. CBR PLD 1959 SC (Pak) 364; The Collector Central Excise and Land Customs v. Imdad Ali 1969 SCMR 708 and Messrs Latif Brothers v. Deputy Collector of Customs, Lahore 1992 SCMR 1083.
(xvi) That as per law laid down ultimate burden of proof lays upon the Customs Authorities which cannot be said to have been discharged merely on account of weakness in the evidence. The appellant placed reliance on land mark reported judgments PLD 1952 Federal Court 19 and PLD 1996 Karachi 68 Kamran Industries v. Collector of Customs (Exports and PLD 1952 Federal Court 19).
Wherein their Lordship of the High Court held "For every offence for which the, accused is charged under the Customs Act he shall have to disprove the allegation of the Customs Authorities is entirely without any obligation upon the Customs Department to adduce evidence, it would amount to affording unfettered, naked and arbitrary discretion to the authorities who may at their sweet will make out false cases against importers without the need of proving the sanctity of their actions. Such cannot be the intention of Parliament while the Courts are under an obligation to place such construction on statues which could be beneficial to the widest extent and which would make the legislation operate fairly, justly and equitably and not unreasonably (see Mst. Zainab v. Kamal Khan (PLD 1990 SC 1051). This Court is also of the view that a construction is to be placed upon statutes which would minimize the discretion vested upon the executive authorities. As absolute power corrupts an interpretation fettering the discretion of the executive authority would be more in line with the principles of equity and justice. The issue regarding the applicability of section 187 is to be looked from another angle i,e, in case we were to hold that due to section 187 the entire burden to dispute the entire case rest upon the accused alone. The executive authorities would be let loose and given a wide, naked and arbitrary discretion to operate without any guidelines which would then leave section 187 susceptible to a Constitutional challenge upon its vires on this score alone. By the interpretation as proposed above any redundancy or illegality would also be avoided.
(xvii) That without complying the requirement of law and the dictum laid down by the superior Courts, it was erroneous on the part of Directorate of Intelligence and the respondent to assume in the absence of incriminating evidence in material particular to issue a show cause notice to the appellant and subsequently pass the impugned order imposing the penalty therein. By virtue of the said fact alone the levelled allegation against appellant in the show cause notice stood washed away as the Directorate of Intelligence and Investigation and respondents cannot allege him for mis-declaration and neither he can be charged for the contravention of Ss.32 and 32A of the Custom Act, 1969.
' That in order to elaborate his stance the appellant reproduced the provision of Ss.32 and 32A below for ease of reference:-- Section 32 False statement, error, etc.---if any person, in connection with any matter of customs, ---- makes or signs or causes to be made or signed, or delivers or causes to be delivered to an officer of customs any declaration, notice, certificate or other document whatsoever, or makes any statement in answer to any question put to him by an officer of customs which he is required by or under this Act to answer, ' Knowing or having reason to believe that such document or statement is false in any material particular, he shall be guilty of an offence under this section. (Emphasis Supplied)
32A.Fiscal Fraud (1) if any person, in connection with any matter related to customs.
(a) Causes to submit documents including those filed electronically, which are concocted, altered , mutilated, false, forged tempered or counterfeit to a functionary of customs;
(b) Declares in the 82 [goods declaration] electronically filed customs declaration, the name and address of any exporter or importer which is physically non-existent at the given address;
(c) Declares in the 82 [goods declaration] electronically filed customs declaration an untrue information regarding 97 [payment of duties and taxes through self-assessment] description quantity, quality origin and value of goods;
(d) Alters, mutilates or suppresses any finding of the customs functionary an any documents or in the computerized record; or
(e) Attempts, abets or connives in any action mentioned in clauses (a), (b), (c) and (d) above, he, shall be guilty of an offence under this section.
(2) Where, by any reason as referred to in subsection (1) as aforesaid, any duty or tax charged or fee or fine and penalty levied under any provision of law has not been levied or has been short levied or has been refunded, the person liable to pay any amount on that account shall be served with a notice within a period of 180 days of the dote of detection of such custom duty and tax fraud, requiring him to show cause as to why he should not pay the amount specified in the notice along with any other amount imposed as fine or penalty under the provisions of this Act.
(xviii) That it is evident from the above expression, that the untrue and false statement attracting the mischief of these provisions has to be made by the importer/exporter and by the clearing agent or by any person submitting document with the customs in connection with any matter of customs "Knowing or having reason to believe". The provision of section 32 contemplates the existence of a personal "knowledge" Believe being a conviction of the mind arising not from actual perception or knowledge but by way of inference of evidence received or information derived from others. It falls short of any absolute certainty because the accused in accounting for his possession may be able to show that the ground upon which is based are unsubstantial. Fazal Kader Chowdri v. Crown PLD 1952 FC 19. Whereas, the term "reason to believe." has to classified at a "higher pedestal, then mere suspicion and allegation, but not equivalent to prove evidence. Even the strongest suspicion cannot transform in "reason to believe". The criteria laid down (to differentiate between mere suspicion and reason to believe) have to be, that some tangible evidence is available against the accused, which if left unrebutted, may leave to the inference of guilt."
Reliance is placed on reported judgment 2011 PTD (Trib.) 2220.
(xix) The invoking of section 32A of the Customs Act, 1969 by the appellant is irrelevant by virtue of the fact that the appellant did not cause to submit any documents neither filed GDs electronically in terms of section 79(1) of the Customs Act, 1969 and Rule 433 of Sub-Chapter III of Chapter XXI of Customs Rules, 2001, being concocted, altered, mutilated, false, forged , tampered or counterfeit as such clauses (a) (b) (c) of the section are not attracted and are inapplicable to the extent of appellant. The clauses (b) (c) are also irrelevant as it is matter of fact that appellant never gave any information electronically or by any other mean corresponding to good declaration referred in the show cause notice as such clauses (b) and (c) are certainly not attracted, whereas clause (d) also does not apply on appellant as he never altered, mutilated or suppressed any finding of any customs functionaries or any documents or in the computerized record, hence, the said clause is certainly not attracted and applicable. The clause (e) is also obviously irrelevant since it accumulates the charges as above and there is nothing on ground to suggest that appellant had any linkage benefit, profit advantage or interest associate with the commission of crime of the unscrupulous person referred in the show cause notice as such leveling allegation of connivance is amount to absurdity. That in terms of subsection (2) of section 32A, a show cause notice has to be issued within a period of 180 days from the date of detection in the instant case the date of detection as clearly given in show cause notice is year 2007 or in the first quarter of 2008, whereas show cause notice was issued in the month of October, 2010 rendering the show cause notice barred by time and is ultra-virus to section 32A to the Customs Act, 1969. Hence, no proceeding can be undertaken against a time barred show cause notice as per laid down law by the Superior Courts. Reliance is placed on reported judgment PLD 1958 SC 104, 1992 SCMR 1$98, 2004 PTD (Trib.)
2898, 2007 PTD 1862, 2008 PTD 60, 2008 PTD 578, 2008 PTD 609, 2008 SCMR 1510, 2008 PTD 2025, 2008 PTD 1539, 2009 PTD (Trib.) 1263, 2009 PTD 1247, 2010 PTD (Trib.) 81, 2010 PTD (Trib.) 1146, 2010 PTD (Trib.) 1469, 2010 PTD (Trib.) 1631 & 2898, PTCL 2009 CL 373 (sic), 2010 PTD 1759, 2010 PTD (Trib.) 2421 and 2011 PTD (Trib.) 2220.
(xx) That the Directorate of Intelligence and Investigations-FBR and respondent No, 1 have committed graye error in charging the appellant under sections 32 and 32A of the Customs Act, 1969, while losing the sight of the fact that he has not imported any of the consignment, not a single word expressed in sections 32 and 32A are attracted on the appellant. Not a single document corresponding to the impugned containers were either transmitted to the MCC of PaCCS under Rule 433 of CR 2001 for clearance of the subject consignments nor any documents by the appellant with the customs either for any purpose. Rendering the whole allegation based on assertion which is not admissible under law as evident from reported Judgment 2006 PTD 1427 = 2006 PTD 2190 that a mere assertion of the prosecution is no evidence while it was held in 2006 PTD 1207 by their Lordship Mr. Sabihuddin Ahmed (Late), Chief Justice that only a person making false statement or a false declaration before officer of Customs could be held guilty of offences under section 32" and subsequently held by the Tribunal in reported judgment 2011 PTD (Trio.) 2297.
(xxi)That the respondent No,2's mala fide intellectual dishonesty can be determined from para.4 of the order-in-appeal, wherein comments of official of DG (I&I)-FBR on the grounds of appeal and additional grounds of the appellant are incorporated despite not warranted in the presence of already submitted comments, these comments were obtained by the respondent No, 2 from the official of DG (I&I)-FBR after conclusion of the hearing and at the back of appellant hence these cannot to be considered for deciding the case, being prejudicial to the appellant, besides non confronted, rendering these comments and order of the respondent No, 2 as unlawful, ab inito and void.
(xxii) That it is appropriate for the appellant to state that the whole case based on the fact that the bunch of unscrupulous persons stole the identity of the appellant for depriving the exchequer from its legitimate revenue, despite not warranted under law in the light of clear admission in the show cause notice that the appellant is not the person, who imported the impugned containers and got those cleared in fraudulent manner. In the given circumstances, nothing can be attributed to the appellant under law and in support of his stance the appellant avail the opportunity for referring the Order-in-Appeal No, 6 of 2007 dated 16-8-2007 of Messrs Zenith Enterprises v. Additional Collector of Customs, (Appraisement-III) Customs House, Karachi corresponding to "stolen identity". In the said judgment the respondent No, 2 allowed the appeal to the extent of the appellant company, while holding that: "All evidence available on record points to the fact that it was clearing, agent and Mr. Hamid Khan who hatched the criminal conspiracy of the importing a heavily under invoiced consignment of furniture and stole the identity of the appellant. Mr. Hamid Khan is on record to have admitted the above> position. Obviously, the purpose behind importing goods under the stolen identity was to get away with the evaded Government Revenue if some illegality was detected after clearance of the goods. Under the circumstances one has to draw the conclusion that the fake invoice presented to customs along with GD was also prepared by the clearing agent. Since the appellant had not made any untrue declaration to the customs, penal action taken against them is not justified. Therefore, I ordered to remit the penalty on them. The impugned order is modified to the aforesaid extent.
(xxii) That the respondent No, 2 allowed the appeal of importer confronted by similar situation, whereas in contradiction to that he rejected the appeal of the appellant. While doing so he gave a differential treatment to the appellant, which is in violation of Articles 4 and 25 of Constitution of Islamic Republic of Pakistan. The 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 "there exist 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 "doctrines of equality, as contained in Art. 25 of the constitution, enshrines 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 laced 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 by the respondent No,2 to the appellant is against the principle enshrined in Articles 4 and 25 of the Constitution of Pakistan and violates the principle of law settled by the superior Courts in further 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.
(xxiii) That the appeal with the respondent No, 2 was filed on 28-2-2011 and an order under the proviso of subsection (3) of section 193-A of the Customs Act, 1969 should have been passed by the respondent No, 2 within 120 days from the date of filing of appeal i,e, 28-6-2011 or within a further extended period of 60 days prior to the expiry of initial period of 120 days with reason to be recorded for extension in writing. No extension was granted by respondent No, 2 prior to expiry of initial period of 120 days instead extension was granted on 27-82011 as evident from Para 6 of the order-in-appeal. Rendering the order barred by time by 59 days, hence without power/jurisdiction.
(xxiv) The narration of the respondent in para 6 of order-in-appeal that the proceedings in this case could not be finalized within the stipulated time limit due to adjournment obtained by the both parties. This is completely a erroneous and without substance as the consultant of the appellant sought no adjournment instead attended the hearing fixed for 26-3-2011 and 14-4-2011, and neither by the DG (I&I)-FBR and respondent No,
1. Hence, the extension granted if any by the respondent No, 2 is illegal. Besides the respondent No, 2 could not extend the time, unless a notice to the appellant was served as held by the Supreme Court of Pakistan in its reported judgment 1999 SCMR 1881 Khalid Mehmood v. Collector of Customs, Customs House, Lahore. Their lordship of Supreme Court held " S. 168----If initial period of two months, envisaged in S.168, Customs Act, 1969 is allowed to go by without any extension having been made, vested right may come to accrue to the affectee and Collector should be obliged to issue a notice and accord necessary hearing before granting any extension--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 purported to have been so made, within time may not itself be enough the contrary may be shown but, ordinary within the Customs Jurisdiction alone." "thus if initial period of two months, envisaged in S.168, Customs Act, 1969 is allowed to go by without any extension having been made, a vested right may come to accrue to the affectee 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 itself be enough the contrary may be shown but, ordinarily within the Customs Jurisdiction alone."
(xxv) That in the instant case no extension was given by the respondent No, 2 prior to expiry of initial period of 120 days. Rendering the extension granted on 27-8-2011 as unlawful and without jurisdiction, by virtue of the fact that the said extension was given without answering the condition prescribed for exercising such powers i,e, he has to apply his mind and after making an objective assessm ent, if he comes to the conclusion that the extension of time is to be granted, he has to grant the same, not merely on the basis of his personal opinion that the proceeding in this case could not be finalized within the stipulated time limit due to adjournment obtained by both parties," which were intact never applied by either side and the can be re-verified by calling the record of the case resting with respondent No, 2". It is settled principle that where exercise of jurisdiction by any authority or Court or Tribunal is made subject to existence of a specific condition, then such power cannot be exercise in the absence of that condition---where an executive authority exercise its jurisdiction after expiry of period provided in the statute, such exercise manifestly suffer from lack of jurisdiction as held by the Superior Court in umpteenth judgment e.g. 2004 PTD 369, 1998 MLD 650, 2005 PTD 23, 2003 PTD 2821, 2004 PTD (Trib.) 2898 , 2007 PTD 2092, 2010 PTD. (Trib.) 1636, 2010 PTD (Trib.) 2117, 2011 PTD (Trib.) 79, 2011 PTD (Trib.) 987, 2011 PTD (Trib.) 1010, 2011 PTD (Trib.) 1146 and 2012 PTD (Trib.) 1650.
(xxvi) The appellant carves his right to add any fresh grounds at the time of hearing besides placing any valid incriminating evidence/ documents
5. No cross objections on the memo. Of appeal under section 4 of section 194 of the Customs Act, 1969 were either filed by the Directorate General of Intelligence and Investigation-FBR or respondent No,
1. Nevertheless, upon conclusion of the arguments of the consultant of the appellant, Mr. Rana Gulzar Ahmed SIO of DG (I&I)-FBR relied upon the B/L's used in the unlawful clearance of the containers containing name of the appellant's company. The consultant of the appellant instantly raised objection to that with the submission that the said piece of evidence was never ever confronted, hence, he is unable to offer any rebuttle and ask for the copies of the entire relied upon documents. The Tribunal accordingly directed the departmental representative to supply copies of entire record available with them to the consultant of the appellant, for rebuttle/objection if any which were supplied subsequently to the appellant consultant by them.
6. The appellant consultant in exercise of his right of rebuttle and submitted additional argument dated 1-6-2013 reading inter alias- ' With reference to the hearing conducted on 30-6-2013 by the Larger Bench of the Hon'ble Customs Appellate Tribunal, the respondents relied upon some B/L alleged to be issued in the name of the appellant for electronic goods, which were never confronted with by any of the authority, resultant, copies of the same were demanded by the consultant of the appellant and the Hon'ble Tribunal very graciously directed to the official of the Directorate General of Intelligence and investigation-FBR to supply those to the appellant for offering comments on the veracity of those. Consequent to which appellant was supplied with 9 B/L's as against 12 along with 07 delivery orders 3 gate passes and 7 empty container delivery acknowledgement, detail of which is given here-in-below: Bills of Lading
(i) 51288282 (ii) 512105385 dated 25-1-2007 (iii) 85401364 (iv) 512105385 dated 25-1-2007, (v)
8593685.3 (vi) 512105385 dated 25-1-2007 (vii) 512065512 dated 17-1-2007 (viii) ZGSG6023 dated 22-1-2007 (ix) ZGSG 31996 dated 9-1-2007.
Delivery Order ' Against B/L No, (i) 854013643 (ii) ZGSG 31996 (iii) 85936853 (iv) 512105385 (v) 512105385 (vi)
512065512 and (vii) ZGSG60321 Gate Pass/No Objection Certificate For (i) MSKU9881887 (ii) GLDU703040 (iii) MSKU9183989 Empty Container delivery Acknowledgement ' Against (i) 021398-4091 dated 27-1-2007, (ii) 021398-4093 dated 27-1-2007, (iii) 021401-0758 dated 7-2-2007, (iv) 0214017203 dated 14-2-2007, (v) 021401-7177 dated 14-2-2007, (vi) 021401-7171 (vii)
021405-1143 dated 6-3-2007 and (viii) 0214069059 dated 17-3-2007.
' Upon scrutiny of the B/L it has been observed that this contains address as 14C, Block-A, Qadri Chamber, Mcleod Road, Lahore and Phone No,5821491. No such number i,e, 14C exists in Qadri Chamber nor Block-A, whereas the appellant address is 214 Qadri Chamber, Mcleod Road, Lahore and his phone number for the last many year is 7311649 and 7233123 and the said number is also mentioned by the FBR in the NTN number issued to the appellant in the year 2004 (See Exhibits "C" at page 115 of memo. Of appeal), for further confirmation of the said fact telephone bills for the year 2006, 2007 and 2013 are annexed and marked as (Exhibits Al to A15 pages Nos.32 to 37).
Resultantly, these B/L's are not related to us in any manner, instead to accused Faisal Shahzad and Naeem Qureshi as evident from their admission incorporated by the Directorate General of Intelligence and InvestigationFBR in the F.I.R., Interim/Final Challon.
' It is imperative for the appellant to add further that the B/Ls corresponding to the imported consignment of the appellant always contain his office telephone number or that of his brother Mr. Farooq Saleem, who is a clearing agent and works and operates under the name of Messrs AI-Fajr Associates, Karachi office telephone number and his cell No, i,e, 32310812 and 0300-2010112. He never got his consignment cleared either through Messrs NJ International or Messrs Durrani Trader Karachi, instead all his consignments were handled by Al-Fajr Associates Karachi and the said fact stood validated from the annexed 53 consignments documents corresponding to the period between 17-6-2005 to 22-3-2008 supplied earlier to the Directorate General of Intelligence and Investigation - FBR in reply to notice dated 5-8-2008 (See Exhibit "N" at page 142 of Memo. Of appeal), detail of which are given herein below:--
(a) B/L # NYKS 479151714 dated 17-6-2005 (GD # KPQII1-HC 1708 dated 16-7-2005. (b)B/L # QAJZ 55665 Dated 17-7-2005 (And copy of GD corresponding to IGM number 583 Dated 10- 6-2005, Index number 21). (c) B/L # INT/ PKJ/ KHI/0712 Dated 22-7-2005 (And copy of GD corresponding to IGM number 1546 dated 11-8-2005, Index number 47). (d) B/L # NYKS 479167574 dated 12-8-2005 (GD Number: KPQI-HC 7066 Dated 1-9-2005.(e) B/L # NBMPKL 362401 Dated 21-102005 (GD # KPQI- HC 15414 Dated 14-11-2005. (f) B/L # NBMPKL 366273 Dated 21-11-2005 (And copy of GD corresponding to IGM number 891 Dated 13-12-2005, Index number 13). (g)# MSCUCJ 612963 Dated 13-1-2006 (And copy of GD corresponding to IGM number 125 Dated 11-2-2005, Index number 10).
(h) B/L # A20051303 dated 25-12-2005 GD No, KPQI-HC-23642-25012006 (i) B/L # PKGKHI20051 dated 25-12-2005 GD No, I-HC-35285-140106 (j) B/L # LNLUPSGO1514 dated 6-1-2006 GD # KPI-HC- 23641-250106 (k) B/L # NYKS 479151714 dated 17-6-2005 (GD Number: KPQI -HC 1708 dated 16-7- 2005 (I) B/L number NYKS 479151714 dated 17-6-2005 (GD Number: KPQI -HC 1708 dated 16-7-2005
(m) B/L # 850640074 dated 15-1-2006 GD No,KPQI-HC-23640 dated 25-1-2006 (n) B/L No, AJEAKHI117510 dated 1-4-2006 GD No, KAPR-HC-142811-080406 (o) B/L No, 850649909. Dated 13-4- 2006 (corresponding to IGM 346 dated 26-4-2006, Index No, 192) (p) B/L No, SHKAR060419922E dated 27-4-2006 GD No, KAPR-HC178716-180506 (q) B/L No, LNLUSEL7003109 dated 2-6-2006 (Corresponding to IGM No, 0521 dated .19-6-2006 Index No,74) (r) MEGAJEBKHI90022 dated 30-5- 2006 GD No, KPQI-HC39479-080606 (s) B/L No, DXBA108406 dated 8-6-2006 (corresponding to IGM No, 512 dated 14-6-2006 Index No, 78). (t) B/L JEA/KHI/20062091 dated 10-6-2006 GD KAPR- HC190476 dated 15-6-2006 (u) B/L No, 8SHAKHI3A3995 dated 18-7-2006 GD No, KAPQI-HC-5645 dated 15-8-2006 (v) B/L No, AT-S-4423 dated 11-7-2006 GD No, KAPR-HC-14041 dated 29-7-2006.
(w)B/L No,LNLUDB1025749 dated 17-12-2006 GD No, KPQI-HC-1867-180706 (x) B/L No, AS/KHI/ 5836/06 dated 3-8-2006 GD No, KPQI-HC-5646 dated 150806 (y) B/L No, BXBA110419 dated 10-6- 2006 GD No, KAPQI-HC-13515- 141006 (z) B/L No,OSS-KHI/023-05 dated 25-11-2006 GD No,65451 dated 29-11-2006 (aa) AWB No, 176-3878-4804 dated 30-11-2006 GD No, KAFU-HC-37243 dated 16- 12-2006 (ab)B/L No, 1196010027 dated 12-12-2006 GD No, I-HC151529-201206 (ac)B/L No, 1196009877 dated 13-12-2006 GD No,I-HC-150687-191206 (ad)B/L No,1196010468 dated 25-12-2006 GD No, I-HC- 157545-301206 (ae)13/L No,1196010114 dated 25-12-2006 GD No, 1-HC-157543-301206 (at) B/L No, 1196010232 dated 25-12-2006 GD No,1-HC157542-301206 (ag) B/L No, NYKS-468288700 dated 16-1- 2007 GD Nol-HC-179795-070207 (ah)AWB No, 3952-0025 dated 21-1-2007 GD No, KAFU-HC-45666- 240107 (ai) B/L No, RPL/DXB/KHI/277 dated 31-1-2007 GD No, KAPR-HC-90609- 120207 (aj) B/L No, RPL/DXB/KHI/279 dated 5-2-2007 GD No, KAPR-HC-91758-130207 (ak) B/L No, RPL/DXB/KHI/280 dated 5-2-2007 GD No, KAPR-HC-91360-150207 (al)AWB No, 176-3975-1504 dated 6-2-2007 GD No, KAFU;HC-49527 (am)B/L No, 1197001530 dated 25-2-2007 GD No, I-HC203672-030307 (an)B/L No, 1197001783 dated 4-3-2007 GD No, KAPR-HC-100541-1303.2007 (ao)B/L No, AS/KHI/6065/07 dated 5- 3-2007 GD No, KAPR-HC-101067 dated 14-3-2007 (ap)B/L No, RSL/AJM/KHI/0528 dated 13-2-2007 GD No,KAPR-HC-96810-1-3-07 (aq)B/L No, RSL/DXB/KHI/0541 dated 22-2-2007 (corresponding to IGM No, 349 dated 24-2-2007 Index No, 392) (ar)B/L No,1197002307 dated 22-3-2007 GD No,I-HC-228273 dated 310307 (as)B/L No, APLU062341597 dated 5-5-2007 GD No, I-HC-277839-240507 (at)B/L No,NYKS468308199 dated 23-5-2007 GD No,I-HC-298006- 150607 (au)B/L No, OOLU3020110020 dated 17-6-2007 GD No,I-HC-39114-170707 (av)B/L No, NYKS-468308508 dated 27-6-2007 GD No, I- HC-333734-210707 (aw)B/L No, JEAKHI0750367 dated 4-7-2007 GD No,I-HC-30050-070707 (ax) B/L No, FL 0707GZ0054 dated 21-7-2007 GD I-HC366097-240807 (ay)B/L No, JEAKHI 070000448 dated 13-8-2007 GD No,I-HC-361138 dated 18-8-2007 (az)B/L No,NYKS468308682 dated 1-8-2007 GD No, I- HC-370798- 280807 (ba)B/L. No,MSCUHX030490 dated 1-10-2007 GD No,I-HC-436170-031107 (bb)
B/L No, LL69166 dated 7-1-2008 GD No, KAPR-HC-60762-120108 and (bc) B/L No,SYCWKILB8095940 dated 29-3-2008 GD No,I-HC-620409- 230408.
' That the contravention report prepared by Directorate General of Intelligence and Investigation - FBR and show cause notice/order in original issued/passed by the respondent number 1 is based on conjectures and roving and fishing inquiries, which is not permitted under law laid down by the superior judicial Fora in the reported judgment in corporate in ground (b) of memo. Of appeal and reported judgment (1957) 32 ITR 89 (1967) 64 ITR 516, I.T As. 2400/2401/KB/ 91-92, (1995) PTD (Trib.)
580, (1995) PTD (Trib.) 1152, (1982) 1381 ITR 742, 1993 PTD 206,1997 PTD (Trib.) 2209 and PLD 1992 Supreme Court 485 and 2013 PTD (Trib.) 353 for implicating the appellant.
' The Directorate General of Investigation and Intelligence and respondent also fail to prove the allegation despite of the fact that the burden of proof lays upon them as per famous maxim, that one who alleges has to prove the allegation in terms of Articles 117 and 121 of Qanun-e-Shahadat (10 of 1984) and the law laid down by' the Superior Judicial Fora relied upon the appellant in ground
(xv) and 2002 PTD 700 (HCKAR), 2002 PTD 407(HCKAR) and 1959 (HC of Pak.) 364. Which they miserably failed as evident from the fact that they have nothing in their hand to prove the guilt of the appellant, Copies of good declaration, trail of the unlawful cleared goods against the phony impugned B/L's, or the statement of the accused pointing finger at the appellant. In the presence of these vital facts, the Directorate General of Intelligence and Investigation - FBR are hell bent to implicate the appellant. Rendering the whole exercise invalid and eminently based on conjectures and fishing and roving inquiries, not permitted under law.
' The appellant has furnished his appeal, facts and grounds properly supported by affidavit, which has not been (1) controverted and/or (2) refuted by counter affidavit which are not open to dispute instead amount to admission as held in reported judgment 1986 PLC (C.S.) 560, 1980 CLC 2007, 1986 CLC 746 (Kar.), 1986 CLC 1408 (Kar.), 1993 SCMR 662, 1991 MLD 1243, (1974) 94 ITR 1, (1984) 146 ITR 40 and 1986 PTD (Trib.) 119.
' In the light of grounds of memo. Of appeal and above submission, the Hon'ble Tribunal is prayed for issuance of decision after framing question of facts and law and thereafter recording the finding against those after considering all the grounds raised in the memo. Of appeal and the instant additional arguments and the exhibits annexed therewith and the citation relied upon in accordance with the principle laid down by the Superior Judicial Fora in reported judgment 2002 CLC 825 Qamaruddin v. Province of Sindh (2004) 136 Taxman 412 General Medical Store v.
Commissioner of Income Tax, 2005 PTD 2417 Shah Moorad Sugar Mills Ltd., v. Additional Collector Sales Tax (Quetta), Hyderabad and others, 2006 PTD (Trib.) 62, 2008 PTD 1940 Dr. Zafar Haider v.
Income Tax Tribunal and 02 others, Rectification Application in Sales Tax Appeal No, 217, Maxco (Pvt.) Ltd., Karachi the CIR RTO, Karachi.
7. The Tribunal during the course of hearing on 30-6-2013 examined the submission made in additional arguments of the consultant and the annexed documents and observed that the. B/L relied upon has no nexus with the appellant company, resultantly, the departmental representative were directed to bring on record any other evidence showing involvement of appellant i,e, invoices, good declaration as stated by respondent No, 1 in his order or statement of any accused pointing finger towards the appellant or trail of the goods after removal from the port and ultimate landing of those in the warehouse of appellant at Lahore by 24-6-2013. On the said date the departmental representative informed the Tribunal in categorical terms that they have no other piece of evidence, or statement of any accused etc., implicating the appellant with the exception of B/L's.
8. Rival parties heard and case records perused and the following issues are framed for consideration by this forum:-
(i) Whether respondent No, 2 is empowered to reject the appeal while ignoring the provision of section 193-A ibid under the refuge of section 195-B of the Customs Act, 1969 despite not mandatory beside nullity to Article 10-A of the Constitution of Islamic Republic of Pakistan and injunction of Islam ?
(ii) Whether the case of the appellant has been made out on the basis of un-refutable incriminating evidence or otherwise?
(iii) Whether the Directorate General of Intelligence and Investigation-FBR has successfully discharge initial burden of proof laid upon them under Section 187 of the Customs Act, Articles 117 and 121 of Qanun-e-Shahadat (10 of 1984)?
(iv) Whether allegations under sections 32 and 32A can be levelled on the appellant in the absence of any declaration and statement as per expression of the section?
(v) Whether show cause notice is within time as per the provision of subsection (2) of section 32-A of the Customs Act, 1969?
(vi) Whether the Order-in-Appeal is barred by time and without powers/jurisdiction in terms of subsection (3) of section 193-A of the Customs Act, 1969 being issued after 59 days of the initial period of 120 days and extension granted on 27-8-2011 in Para 6 of the Order by respondent No,2 on 27-8-2011, after the expiry of initial period of 120 days is illegal, ab initio and void?
9. That as regards issue No, (i), the respondent No, 2 is empowered under subsection (3) of section 193-A to pass an order as he thinks fit to confirm, modify or annul the decision or order appealed against. The said section is not attached with any conditionality and neither it has to be read in conjunction with section 195-B of the Customs Act, 1969; both are independent of each other.
Applicability of section 195-B of the Customs Act, 1969 during the course of hearing of appeal without giving a notice to the affected party under section 195-B ibid is totally illegal. Even otherwise section 195-B of the Customs Act, 1969 is directory and permissive in nature, therefore the appeal cannot be dismissed by the respondent No, 2 on the basis of non-deposit of penalty.
The said provision is imperative and obligatory as it uses the word "shall", this word or must are generally considered as mandatory but it is equally well settled that the word "shall" and "may" depending upon the context in which they have been said or often interchangeable as held by Hon'ble Supreme Court of Pakistan in reported judgment PLD 1972 SC 326 that "it is now well settled that the words "may" and "shall" in legal phraseology are interchangeable depending on the context in which they are used or not to be interpreted with the rigidity, which is attributed to them in ordinary parlance.
' Although section 195-B of the Customs Act, 1969 while directing the deposit of amount of duty in respect of goods which are not under the control of customs authority or any penalty levied under this Act uses expression "shall" no consequences are flowing in the expression for non-compliance.
Another well settled principle of interpretation of statutes became applicable that as the language of section 195-B of the Customs Act, 1969 is in affirmative and non-negative it is deems to be directory not mandatory as held in reported judgment PLD 1974 Supreme Court 134 Niaz Muhammad Khan v. Mian Fazal Rakib that "as a general rule a statute is understood to be directory when it contains matter merely of direction, but not when those directions are followed up by an expressed provision that, in default of following them the fact shall be null and void. To put it differently if the act is directory its disobedience does not entail any invalidity if the Act is mandatory disobedience entail serious legal consequences amounting to the invalidity of the act done in disobedience to the provision.
' The respondent No, 2 failed to appreciate that the provision of section 195-B has to be read in harmony and in the benefit of the appellant because nonpayment of imposed penalty least snatches his right of appeal guaranteed under section 193 of the Customs Act, 1969 hence it would have been appropriate for him to dispense with the condition of payment of penalty as i,e, proper and just course of action and should have decided the appeal on merits as right of appeal is an inalienable right guaranteed under section 193(1) and Constitution of Islamic Republic of Pakistan and injunction of Islam beside the said act would have been an act of allowing the appellant a fair trial in terms of Article 10-A of the Constitution of Pakistan, 1973 (18 Amendment) . This finding of Tribunal hold strength from reported judgment 1993 MLD 1645, 1993 CLC 1405 and 2005 PTD (Trib.)
731. On the basis of the foregoing we answer the issue No, (i) in negative.
10. That as regards issue. No, 2 the entire structure of the case by the Directorate General of Intelligence-FBR has been purportedly built upon the copies of B/L allegedly issued in the name of appellant company. These contain address as 14C, Block-A, Qadri Chamber, Mcleod Road, Lahore and Phone No, 5821491 as against the address of appellant company 214 Qadri Chamber, Mcleod Road, Lahore and Phone Nos.7311649 and 7233123, which are also available in the NTN Certificate issued by FBR and the B/L's of the appellant imported consignments with the exception of these. No "invoices" or "goods declaration" or any relevant documents submitted by the appellant under section 79(1) of the Customs Act, 1969 and Rule 433 of Customs Rules, 2001 or documents expressed in section 2(kka) ibid in reply to view messages in terms of Rules 437 of Sub-Chapter III of Chapter XXI ibid has been presented for corroborating the B/L's veracity and para 22 of the order dated 10-1-2011 of the respondent No,1 instead the representative of the Director General Intelligence and Investigation-FBR and MCC of PaCCS candidly admitted that they are not in possession of any of these documents, nor statement of the accused implicating the appellant or trail of the goods unlawfully taken out of QICT.
' That since the edifice of the case against the appellant has been built upon the basis of B/L's, which has no nexus with the appellant or his company, no further efforts to substantiate those were made by the Directorate General of Intelligence and Investigation-FBR to this date, resultantly these are not admissible as an evidence for implicating the appellant and this fact has been validated by the Directorate General of Intelligence and Investigation-FBR through final challan dated 2-7-2009 submitted to the Special Judge (Customs and Taxation) in which they exonerated appellant from any wrong doing as nor his name or neither his company name was shown in any column of the challan e.g. Even the absconder. Irrespective of the said fact they chased the appellant through multiple notices and letters even after submission of final challan e.g. a call notice dated 21-4-2011 was served on them after issuance of hearing notice by the respondent No, 2 in the appeal for nailing him down. The said attitude is highly questionable and cannot be appreciated at all. Simultaneously, this confirms that this is the case of no evidence as held in reported judgment 1991 PTD 551 that "Any action which is based upon no evidence is not permitted by law "and in 2006 PCr.LJ 1427 = 2006 PTD 2190 that " a mere assertion of the prosecution is no evidence" and the whole case is being made out on the basis of conjectures and fishing inquiries which is not permitted under law as per law laid down by the Hon'ble Supreme Court of Pakistan in reported judgment PLD 1992 Supreme Court 485. The Assistant Director Intelligence and Investigation v. B.R Herman Mohattas (Pvt.) Ltd., Karachi that "it cannot make a rowing or fishing inquiry or issue a notice by merely shooting in the dark in the hope that it will be able to find out some material out of those documents and then charge the party of irregularity or illegality". The said principle was subsequently held by the Superior Judicial fora in reported judgment (1957) 32 ITR 89 (1967) 64 ITR 516, I.T.As. 2400/2401/KB/91-92, (1995) PTD (Trib.) 580, (1995) PTD (Trib.) 1152, (1982) 1381 ITR 742, 1993 PTD 206, 1997 PTD (Trib.) 2209 and 2013 PTD (Trib.) 353. We therefore hold that the case against the appellant is based on presumptions, assumptions conjectures and rowing and fishing inquiry and answer the issue No,ii in negative.
11. That as regards the issue No, (iii), it is felt appropriate to elaborate the mechanism of clearance through MCC of PaCCS. In the said system the importer/exporter files online goods declaration under sections 79(1) and 131(1) of the Act and Rules 433 and 444 of Sub-Chapter III and IV of Chapter XXI of the Customs Rules, 2001 while paying the upfront duty and taxes leviable under the Act on the consignment. Immediately upon receipt of GD either the system automatically select the GD for examination in terms of Section 198 of the Customs Act, 1969 and Rules 435 and 450(1) ibid. Or for assessm ent under section 80 or clause (c) of section 131(1) of the Customs Act, 1969 and Rule 438 and Sub-Rule (2) of Rule 450 ibid. The Assessing Officer upon appearing of the GD after examination or for assessm ent on his desktop attends that and if the GD is not marked by system for examination and he feels that the examination is must for. Determination of applicable PCT and assessm ent of value, he himself recommends to the respective Assistant/Deputy Collector of the Group for examination, who either accedes to his request or rejects that. Thereafter the Assessing Officer proceeds with the procedure of assessment and completed that under section 80 and clause (c) of section 131(1) of the Act and Rule 438 of Customs Rules, 2001 either on declared PCT or value on the PCT and value he considered to be correct for levy of duty and taxes on the basis of Valuation Ruling if any or in the light of data maintained by the Collectorate of the identical/ similar goods in terms of Rule 110 of the period/country specified in Rule 107(a) of Chapter IX of Customs Rules, 2001 and after payment of communicated additional amount of duty and taxes through view message, the system or the authorities concerned pass clearance order in terms of sections 83 and 130' of the Customs Act, 1969 read with Rules 442 and 452 ibid. However, if the assessing officer desires to seek further information in regards to declaration and examination report, he transmits view message under Rule 437 or under Sub-Rule (2) of Rule 109 of Chapter IX of Custom Rules, 2001 to importer/exporter for scanning of the documents or providing those through covering letter for ascertaining the correct declaration in regards to, description, quantity, value and PCT heading and then proceed with the procedure of assessment/clearance order. Nevertheless, if the importer/exporter felt aggrieved from the assessment, they opt to file review before the Principal Appraiser and subsequently with the Assistant /Deputy Collector of the Group under Rule 441 and Sub-Rule (3) of Rule 450 ibid. Who after going through the submission made in review either accept or reject and transmit view message in this regard through which they confirms passing of assessm ent/clearance order under section 80, Rule 438 and clause (c) of section 131 of the Customs Act, 1969 and Sub-Rule (2) of Rule 450 and sections 83 and 130 and Rules 442 and 452' ibid. The system simultaneously transmits clearance message to the respective terminal in terms of clause (ii) of Sub-Rule (c) of Rule 556 of Sub-Chapter XIV of Chapter XXI Custom Rules, 2001.
Upon receipt of this the importer obtains delivery orders from the shipping company and approach the respective terminal for obtaining the goods. The terminal on the strength of received view message from PaCCS and delivery order of the shipping company effect the delivery of the goods to the importers/ terminal Permit the shipping company to load the consignment of the exporter on the vessel for shipment.
' In the instant case appellant filed no goods declaration with the MCC of PaCCS, which is must for obtaining clearance of containerized cargo from QICT, nor any view message for clearance of the goods under Rule 556 of Sub-Chapter XIV of Chapter XXI Custom Rules, 2001, is presented confirming that no consignment can be released by the QICT in the absence of view message of clearance. Nor any goods declaration under the regime of one Customs can be filed for the containerized goods arrived at QICT because it was not permitted and the MCC of Port Muhammad Bin Qasim cannot lay hand on such type of consignment and this fact has been verified by the Collector of Customs PaCCS in his letter C.No, SI/MISC/15/2007/PQ-Import dated 15- 11-2007 that "clearance of containerized cargo is dealt with by MCC of PaCCS". When nothing is available against the appellant confirming clearance of the impugned container by him even from the bunch of documents submitted by him in reply to the multiple notices and letters served upon him under section 26 of the Customs Act, 1969. Resultant, the initial burden stood shifted on the shoulder of Directorate General of Intelligence and Investigation FBR to prove the allegation through corroborative documentary evidence as it is on the person levelling the allegation to proof those as mandated under section 187 of the Customs Act, 1969, Articles 117 and 121 of Qanun-e- Shahadat (10 of 1984) and umpteenth reported judgment referred by the appellant at Paras. (xv) and (xvi) of the order, failed to discharge burden of proof as the same. In reported judgment PLD 1996 Karachi 68 and 2012 PTD 428, wherein their Hon'ble High Court of Sindh has held that: "For every offence for which the accused is charged under the Customs Act he shall have to disprove the allegation of the Customs Authorities is entirely without any obligation upon the Customs Department to adduce evidence, it would amount to affording unfettered, naked and arbitrary discretion to the authorities who may at their sweet will make out false cases against importers without the need of proving the sanctity of their actions. Such cannot be the intention of Parliament while the Courts are under an obligation to place such construction on statues which would be beneficial to the widest extent and which would make the legislation operate fairly, justly and equitably and not unreasonably (see Mst. Zainab v. Kamal Khan (PLD 1990 SC 1051), This Court is also of the view that a construction is to be placed upon statutes which would minimize the discretion vested upon the executive authorities. As absolute power corrupts an interpretation fettering the discretion of the executive authority would be more in line with the principles of equity and justice. The issue regarding the applicability of section 187 is to be looked from another angle i,e, in case we were to hold that due to Section 187 the entice burden to dispute the entire case rest upon the accused alone. The executive authorities would be let loose and given a wide, naked and arbitrary discretion to operate without any guidelines which would then leave section 187 susceptible to a Constitutional challenge upon its vires on this score alone. By the interpretation as proposed above any redundancy or illegality would also be avoided."
12. This lack of evidence or proof has also led to the fact that respondent have not charged the appellant in the final Challan submitted in the competent Court. Thus on the basis of the aforesaid settled principles laid down by the Superior Judicial fora the answer to issue No (iii) is negative.
13 That as regards to issue No (iv), the Tribunal is of the view that without complying. That without complying the requirement of law and the dictum laid down by the Superior Court, it was erroneous on the part of Directorate of Intelligence and the respondent No 1 to assume/ presume in the absence of availability of incriminating evidence in material particular to issue a show cause notice to the appellant and subsequently pass the impugned order imposing the penalty therein.
In order to elaborate verbatim of the provision of sections 32 and 32A is reproduced for ease of reference:- Section 32. False statement, error, etc. If any person, inconnection with any matter of customs, --- -
(c) makes or signs or causes to be made or signed, or delivers or causes to be delivered to an officer of customs any declaration, notice, certificate or other document whatsoever, or
(d) makes any statement in answer to any question put to him by an officer of, customs which he is required by or under this Act to answer, Knowing or having reason to believe that such document or statement is false in any material particular, he shall be guilty of on offence under this section. (Emphasis Supplied)
32A.Fiscal,Fraud (1) If any person, in connection with any matter related to customs:-
(f) Causes to submit documents including those filed electronically, which are concocted, altered, mutilated, false, forged tampered or, counterfeit .To a functionary of customs;
(g) Declares in the [goods declaration] electronically filed customs declaration, the name and address of any exporter or importer which is physically non-existent at the given address;
(h) Declares in the [goods declaration] electronically filed customs declaration an untrue information regarding [payment of duties and taxes through self-assessment] description quantity, quality origin and value of goods;
(i) Alters, mutilates or suppresses any finding of the customs functionary on any documents or in the computerized record; or ' Attempts, abets or connives in any action mentioned in clauses (a), (b), (c) and (d) above, he shall be guilty of an offence under this section.
(2) Where, by any reason as referred to in subsection (1) as aforesaid, any duty or tax charged or fee or fine and penalty levied under any provision of law has not been levied or has been short levied or has been refunded, the person liable to pay any amount on that account shall be served with a notice within a period of 180 days of the dare of detection of such custom duty and tax fraud, requiring him to show cause as to why he should not pay the amount specified in the notice along with any other amount imposed as fine or penalty under the provisions of this Act.
That it is evident from the above expression, that the untrue and fake statement attracting the mischief of these provisions has to be made by the importer/exporter and by the clearing agent or by any person submitting document with the customs in connection with any matter of customs "Knowing or having reason to believe". The provision of section 32 contemplates, the existence of a personal "knowledge". Believe being a conviction of the mind arising not from actual perception or knowledge but by way of inference of evidence received or information derived from others. It falls short of any absolute certainty because the accused in accounting for his possession, may be able to show that the ground upon which is based are unsubstantial. Fazal Kader Chowdri v. Crown PLD 1952 FC 19. Whereas, the term "reason to believe", has to classified at a "higher pedestal, then mere suspicion and allegation, but not equivalent to prove evidence. Even the strongest suspicion cannot transform in "reason to believe". The criteria laid down (to differentiate between mere suspicion and reason to believe) has to be, that some tangible evidence is available against the accused, which if left unrebutted may leave to the inference of guilt." and 2011 PTD (Trib.) 2220.
The invoking of section 32A of the Customs Act, 1969 on the appellant is also irrelevant due to the fact the appellant submit no documents nor filed GDs electronically in terms of Section 79(1) of the Customs Act, 1969 and Rule 433 of Sub-Chapter III of Chapter XXI of Customs Rules, 2001 said to be concocted, altered, mutilated, false, forged tampered or counterfeit as such clauses (a) (b) (c) of the Section is not attracted and is inapplicable to the extent of appellant. The clauses (b) (c) are also irrelevant as it is matter of fact that appellant never gave any information electronically or by any other mean corresponding to good declaration referred in the show cause notice as such clauses (b) (c) are certainly not attracted, whereas clause (d) also does not apply on appellant as he never altered mutilated or suppressed any finding of any customs functionaries or any documents or in the computerized record, hence, the said clause is certainly not attracted and applicable. The F clause (e) is also obviously irrelevant since it accumulates the charges as above and there is nothing on ground to suggest that appellant had any linkage, benefit, profit advantage or interest association with the commission of crime of the unscrupulous person referred in the show cause notice as such levelling allegation of connivance amounts to absurdity.
The issue No, (iv) is answer in negative.
14. That as regards the issue No, (v), in terms of subsection (2) of section 32A a show cause notice has to be issued within a period of 180 days from the date of detection in the instant case the date of detection as clearly given in show cause notice is year 2007 or in the first quarter of G 2008, whereas show cause notice was issued in the month of October 2010 rendering the show cause notice barred by time and is ultra virus to Section 32A to the Customs Act, 1969. No show cause notice can be issued after the expiry of stipulated period and neither any recovery proceeding can be initiated as per dictum laid down by the Appellate Tribunal/High Court and Supreme Court of Pakistan in numerous decision unreported/reported S.T.A. 274 of 2005 in Sattar Brothers v. Collector of Customs (Appeals), Hyderabad and others, S.T.A. 179 of 2006 in Dadabuoy Sack Ltd. v. The Collector of Customs, Sales Tax and Federal Excise (Appeals) Hyderabad and others, 2009 PTD (Trib.) 500 in Shah Murad Sugar Mills and others, 2007 PTD 117, Messrs Ghandhara Nissan Diesel Ltd. v. The Collector of Customs, Karachi, 2005 PTD 2453 PSIC Cutlery, Wazirabad v. Collector of Sales Tax and Central Excise, Gujranwala and others 2008 PTD 981 Joyla Sadat Cotton Industries v Collector of Customs 1992 SCMR 1898, Federation of Pakistan v. Messrs Ebrahim Textile Mils Ltd. And others and 2006 PTD 537, Collector of Customs, Sales Tax (West) Karachi, v. K&A Industries, Karachi, 1007 PTD 1862, 2008 PTD 60, 2008 PTD 578, 2008 PTD 609, 2008 SCMR 1510, 2008 PTD 2025, 2008 PTD 1539, 2009 PTD (Trib.) 1263, 2009 PTD 1247, 2010 PTD (Trib.) 81, 2010 PTD (Trib.) 1146; 2010 PTD (Trib.)
1469, 2010 PTD (Trib.) 1631 and 2898, PTCL 2009 CL 373(sic), 2010 PTD 1759, 2010 PTD (Trib.) 2421, 2011 PTD(Trib.) 2220. The issue No, (v) is answer in negative.
15. As regard issue. No, (vi) relating to time barred vehemently contested by the consultant for the appellant. The record presented before this forum that appeal was filed with the respondent No, 2 on 28-2-2011 and an order under the proviso of subsection (3) of section 193-A of the Customs Act, 1969 should had been passed within 120 days from the date of filing appeal i,e, 28-6-2011 or within further extended period of 60 days prior to expiry of initial period of 120 days with reason to be recorded for extension in writing. No extension was granted by him prior to expiry of initial period of 120 days instead the extension was granted on 27-8-2011 as evident from para 6 of order-in- appeal, rendering the order barred by time by 59 days hence without power/jurisdiction as such void and ab initio.
' The order of extension of the respondent No, 2 in para 6 of order-in-appeal with the reasoning that the proceeding in this case could not be finalized within the stipulated time limit due to adjournment obtained by the both parties. This is completely erroneous and without any substance as the consultant of the appellant sought no adjournment instead attended the hearing fixed for 26-3-2011 and 14-4-2011 and neither by the DG (I&I)-FBR and respondent No,
1. Hence, the extension granted if any by the respondent No, 2 is illegal. Beside the respondent No, 2 could not extend the time, unless a notice to the appellant was served as held by the Supreme Court of Pakistan in its reported judgment 1999 SCMR 1881 Khalid Mehmood v. 'Collector of Customs, Customs House, Lahore. Their lordships of Supreme Court held:-- " S. 1682---If initial period of two months, envisaged in S.168. Customs Act, 1969 is allowed to go by without any extension having been made, vested right may come to accrue to the affectee and Collector should be obliged to issue a notice and accord necessary hearing before granting my extension--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 purported to have been to so made, within time may not be itself be enough the contrary may be shown but, ordinarily within the Customs Jurisdiction alone." "thus if initial period of two months envisaged in S.168, Customs Act, 1969 is allowed to go by without any extension having been made, a vested right may come to accrue to the affectee 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 itself be enough the contrary may be shown but ordinarily within the Customs Jurisdiction alone."
That in the instant case no extension was given by the respondent No, 2 prior to expiry of initial period of 120 days. Rendering the extension granted on 27-8-2011 as unlawful and without jurisdiction, by virtue of the fact that the said extension was given without answering the condition prescribed for exercising such powers i,e, he has to apply his mind and after making an objective assessm ent, if he comes to the conclusion that the extension of time is to be granted, he has to grant the same prior to expiry of the initial period and not merely on the basis of his personal opinion that the proceeding in this case could not be finalized within the stipulated time limit due to adjournment obtained by both parties," and that also after expiry of the initial period of 120 which were in fact never applied by either side and that can be re-verified by calling the record of the days. It is settled principle that where exercise of jurisdiction by any authority or Court or Tribunal is made subject to existence of a specific condition, then such power cannot be exercise in the absence of that condition. In words of Superior Judicial for a 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 documents has become dead on account of non-timely extension of time 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 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 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 assessee had acquired a vested right of escapement of assessment 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 on 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 the 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.I68 (Supra) is allowed to go by without any extension having been made, a vested right may come to accrue to the affectee 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."
' The above view that once limitation period expires the order becomes time barred is also supported by various judgments of the superior judicial for a reported as 2007 PTD 2092, 2010 PTD (Trib.) 1636, 2010 PTD (Trib.) 2117, 2009 SCMR 1126, 2002 MLD 180, 2003 PTD 1354, 2003 PTD 1797, 2008 PTD 578, 2009 PTD 762, 2009 PTD (Trib.) 107, 2010 PTD 465, 2011 PTD (Trib.) 79, 2011 PTD (Trib.) 987, 2011 PTD 1010, 2011 PTD (Trib.) 1146 and 2012 PTD (Trib.) 1650. As such issue No, vi is answered in affirmative.
16. To what has been stated/discussed herein above particularly the interpretation of law under proposed question of law and legal position referred in the light of prescribed law and to follow the ratio decidendi in the judgments of Superior Courts along with additional observations made thereon, we hold that, the impugned orders passed during the hierarchy of Customs, being suffering from grave legal infirmities are declared to be illegal and are hereby set-aside to the extent of present appellant only and allow the appeal as prayed with no order as to cost.
17. Order passed accordingly.