' GHULAM AHMED (MEMBER TECHNICAL-II).---By this Order, we intend to dispose of Customs Appeal No,K-337/2013 (Preventive) filed by Messrs Muhammad Kamran on behalf of all Owners of Miscellaneous Goods Co. Pak International Goods Transport Company, West Wharf Road, Karachi, against the Order-in-Original No,180 of 2012 and 2013 dated 29-3-2013 passed by the Additional Collector of Customs Adjudication-I, Customs House Karachi. The appeal has been heard and disposed off through this order.
2. Brief facts of the case as per Show Case Notice No,CN-KSO-27/ 2012 dated 26-5-2012, that credible information was received to the effect that a sizeable quantity of smuggled foreign Origin contraband Whisky would be transported through a Trailer laden with a container, bearing Registration No, JU-8655 under the grab of miscellaneous merchandise goods booked under different bilties. Accordingly, Customs Special team was constituted to foil the attempt. On 29-3- 2012 the aforementioned trailer laden with the said container was intercepted at ICI Bridge, Mauripur Road, Karachi. The occupant/ driver was identified as Nasir Khan. He was asked about the load of the container to which he replied that the container contained miscellaneous merchandise goods loaded from Pak. International Goods Transport Co. (Regd), West Wharf Road, Karachi for transportation to Lahore under different abilities which he produced. Another person was seated allowing the above mention driver who disclosed his name as Shah Khalid s/o Lal Baz and further told that he was 2nd driver of the trailer. As there existed specific information of foreign origin whisky, the said trailer laden with container was then escorted to the office of Anti Smuggling Organization/Headquarters, NMB Wharf Karachi, under the escort of above mentioned musheers along with both the above mentioned occupant/drivers. The examination of the aforesaid container was started in the presence of above mentioned musheers and both the above mentioned drivers. During DE stuffing it was noticed that the cartons stacked in the end of the container were found to contain smu ggled foreign origin whisky. These Cartons were 20 in number which were plain and without any marks and numbers these were reserved to hoodwink the law enforcement agencies. Detailed examination of these cartons resulted in the recovery of foreign origin (Scotland) Whisky 240 bottles. These 20 cartons of whisky were lying in the container without any bilty or document. The other miscellaneous merchandise goods were also recovered from the said container v/z plastic molding compound (Iranian and Kuwait origin) DVD/R (made in China).
The connivance of both the drivers who loaded / concealed 20 cartons containing 240 bottles of foreign origin whisky was not covered under any bilty and concealed the same in their truck beneath other merchandise to camouflage the presence of foreign origin liquor. Repeated notice under section 165 of the Customs Act were sent to accused Dawood with the direction to join investigation but he deliberately avoided to join investigation which showed his mala fide and involvement in the commission of crime. Enquires made from Messrs Pak. International Goods Transport Company has revealed that said Dawood was absent from his place of duty and has gone underground since the incident took place. Efforts are still underway to locate and arrest him who's arrest could enlarge the scope of investigation. Enquires made from Messrs Kamran and Abdul Latif both employees of M/s. Pak International Goods Transport Company has led to the discloser that after the murder of the owner, Tipu Pelwan of the said transport company, Whereas Dawood was working as manager at Karachi Branch. During the course of investigation it transpired that seized foreign origin liquor was brought to the Karachi Terminal of said transport Company by an unknown person in a jeep and under the specific instructions of accused Dawood, same were loaded into the seized truck without cover of any bilty. In order to gather information about the registered owner of seized truck a letter has been sent to ETO, Motor Vehicle Registration Wing, Karachi. The reply from the concern quarter is still awaited. However, the photo copies of the registration documents have now been procured and according to which the owner of the seized truck is one Sherzada Khan son of Mehboob Khan R/o Muhammad Colony, Baba Ahmed Road, Near Noor Masjid Sector-2, Flat No, 202, and Karachi.
' On the basis of above contravention report a Show Cause Notice No, ASO-27/2012-Hqr Dated 26- 5-2012 issued, case was adjudicated by the Additional Collector of Customs, Adjudication-I, Customs House Karachi and impugned Order-in-Original No, 180 of 2012-13, dated 29-3-2013 issued as under:-- "I have gone through the case record and considered arguments by the Advocate Muhammad Mustafa, Mr. Naseem Yousaf and MCC Preventive. Advocate Muhammad Mustafa claimed 526 Bags of Poly HDPE (EX-5) on behalf of Qudratullah and Abdul Rahim and Mr. Naseem Yousaf of Rashidya Impex claimed 30 bags of Calcium Propionate Powder. The documents in support of the purchase of the seized goods 526 polyethylene bags are, found to be irrelevant. However the import of 30 Bags of Calcium Propionate Powder has been reconciled and accepted by the seizing agency. These goods (i,e, 30 bags of Calcium Propionate) are therefore allowed to be released unconditionally having been legally imported on payment of duty and taxes. The goods claimed on behalf of the respondents represented by Advocate Muhammad Mustafa and all the remaining unclaimed goods are found to be non duty paid and smuggled. All these are confiscated under clauses (8), (9), (89), and (90) of section 156(1) ibid of the Customs Act, 1969 with Container No, GSTU-987577-6 along with Trailer Nissan bearing Registration No,JU-8655 under section 157(2) of the Customs Act, 1969. However, an option is given to the owner of the vehicle under section 181 of the Customs Act, 1969 to redeem it on payment of fine equivalent to 20% of the assessable value. A penalty of Rs,10,000 (Ten Thousand only) is also imposed on the owner of vehicle with the warning to be careful in future. The Pay Order deposited as security be released on receipt of payment of redemption fine and penalty otherwise the pay order be enchased."
3. Being aggrieved and dissatisfied with the impugned Order-in-Original No,180 of 2012-2013 dated: 29-3-2013, the appellant filed this appeal before the Customs Appellate Tribunal on the following grounds:-
(a) That the Order-in-Original is ex parte order passed without hearing the other claimants therefore, it is void ab-initio and bad in the eyes of law which is liable to be set aside.
(b) That locally manufactured goods have been confiscated treated them as non duty paid and smuggled goods which shows that Adjudicating officer has passed this order without applying his mind.
(c) That impugned Order-in-Original is not speaking order therefore liable to be set aside.
(d) That the appellants, owners of Misc. Goods and transport company are the law-abiding persons of Pakistan and the said detained goods is the only legitimate source of their income as being poor persons the appellants have no other option to earn livelihood of their large families as the appellants' goods is in the custody of the seizing agency without lawful authority.
(e) That the Notice under section 171 of the Customs Act, 1969 has not been served or issued to the appellants which is the mandatory requirement of law and in the present case the seizing agency clearly violated the Mandatory provisions of law.
(f) That vehicle and goods of the appellant transport Company were seized within the country hence the goods and vehicle as seized by the Customs were without lawful authority as the place of seizure was not fall border area.
(g) That the vehicle and Miscellaneous goods in question were intercepted and no mushirnama was prepared at the spot which was required to be prepared being the mandatory provision of section 103 of Cr.P.C. And also the opted mushirs were belonged to department and members of seizing party which can be confirmed from the record of the case hence separate mushirnama of the recovery was not prepared at the time of seizure.
(h) That sections 2(s) and 16 of the Customs Act are not applicable as per circumstances of the case and in presence of the prior information it was duty of seizing agency to follow mandatory provisions of sections 162 and 163 of the Customs Act, 1969. Section 162 of the Customs Act, empowers under section 163(1), an officer of the Customs not below the rank of an Assistant Collector of Customs or any other officer of like rank duly employed for the prevention of smuggling if he has reason to believe that any goods liable to confiscation under the act are concealed or kept in any place and there is a danger that the same may be removed before a search, can be effected under section 162, may after preferring a statement in writing of grounds of his belief and of goods for which, search is to be made. According to the subsection (2) of section 163 officer further required to leave a signed copy of aforementioned statement in accordance with the mutates mutandis with the provisions of criminal procedure code. If the search carried out without a warrant is in contravention of section 163(1). The presence of the Magistrate cannot be said to obviate a necessities of obtaining a search warrant. The precedent cited in a case Shaukat Hussain v. Zulfiqar Ahmed and others (PLD 1981 Lahore 13), 1983 PCr.LJ 676, already decided by the Superior Court, release the seized goods, it was held that:-- "It, therefore, follows that all the proceedings taken by respondent the raid, the search, the seizure and the prosecution of the petitioners is without lawful authority and of no legal effect. It is so declared. All the subsequent proceedings, which are based on such an illegality, are all non- existent in the eye of law. The goods seized shall forthwith be returned to the respective petitioners.
' I, therefore, accept the Petitions and declare that the search and the seizure of the goods in question are without lawful authority and of no legal effect and that the subsequent proceedings, either before the Customs Authorities or the Special Judge Customs, based on such search and seizure are not existent in the eye of law and direct that the goods seized be returned to the petitioners."
(i) That the vehicle and goods were seized from municipal limits of Karachi city within the country as confirmed from record of the case and there is not any restriction for the movement of same kinds of vehicle within the boundary of the Country and the contents of the show cause notice are denied because the same are concocted, fabricated, due to ulterior motive and S.R.O.118/83 dated 12-12-1983 is material whereby FBR has notified the area of five(5) miles adjacent to the frontier of Pakistan with India and Iran to the area to vich section 177 of Customs, Act shall apply. Thus the bare readi of section 177 read with S.R.O. 118/83, shows that the transportation of goods within the territorial limits of Pakistan do not constitute an offence and place of seizure as alleged is Karachi City from where said vehicle and goods were seized.
(j) That there is no justification to detain the locally manufactured goods. The same cannot be detained by any Agency under any law of land.
(k) That imported goods were purchased from local market and therefore, there is no restriction to purchase and transport the same within the country. However, the import documents and purchase receipts thereof are enclosed along with list of imported goods as.
4. The Appeal was fixed for hearing on 24-5-2013. Mr. Muhabbat Hussain Awan Counsel for the appellant and Mr. Fareedullah Khan departmental Representative were present.
' Mr. Muhabbat Hussain Awan learned counsel for the appellant argued the case at length and put forth the following Additional grounds:--
(i) That the Order-in-Original (ONO) was passed without providing the opportunity of hearing to the appellants and therefore, the impugned order is ex-parte order. This is not speaking Order.
(ii) That the Show Cause Notice was not issued within stipulated period of two months from the date of seizure report. The prosecution may be directed to submit the acknowledgement receipt of Post office or Courier service as required under section 215 of the Customs Act 1969. The learned counsel requested the Tribunal to ask the departmental representative to show acknowledgement receipt of the Show Cause Notice.
(iii) That the Notice under section 171 of Customs Act, 1969, was not served on the owners of Miscellaneous goods. Seizing Agency has violated the mandatory provision of Customs Act, 1969, therefore SCN and 0.N.0 have no support of law. This is clear cut violation of Custom Act, 1969. No Mushirnama was prepared on the spot. There were no independent musheers present at the time of seizure of Goods. The musheers shown in the Show Cause Notice were departmental employees.
(iv) That the goods were taken into possession and seized by the ASO staff from the appellant i,e, Pak International Goods Transport Company under section 168 of the Customs Act, 1969. The subsection (2) of section 168 of the Customs Act, 1969 provides that seized goods shall be returned to the person from whose possession they were seized. Therefore, appellants are the genuine claimants. It is general law that the carrier is responsible to deliver the goods to its owners even in case of breakage, damage, destruction, theft and Decoity with the help of insurance company in case the goods are ensured. The learned Advocate presented the citation in support of his contention as PTCL 1983(CL)
184. He has further stated that the show cause notice was addressed to the manager of Pak International Goods Transport Company for the information of owners of miscellaneous goods therefore the transport company is the real custodian of the goods and seized goods must be returned to the transport company for onward delivery to its owners.
(v) That the locally manufactured goods were seized and detained without any legal reason. These goods cannot be confiscated as there is no law to seize or confiscate locally manufactured goods.
The 0-N-0 is therefore illegal.
(vi) That the Miscellaneous goods loaded on Truck were seized within the Country as such these goods cannot be treated as smuggled goods.
(vii) That the Notice under section 171 was not issued in the names of Miscellaneous Goods owners although the names of the owners of Miscellaneous Goods were provided in shape of billties to the seizing agency but even then no notice was served upon the owners of the Miscellaneous Goods which was mandatory and it is violation of Customs Act, 1969.
(viii) That As per impugned Order-in-Original 180 of 2012-13 no one appeared before the adjudicating officer from transport Company. He has also not discussed regarding seizure of local goods he discussed only smuggled and non-duty paid goods. Nothing discussed about Local Goods, whereas more than 50% consignments are consisting of local goods. The adjudicating officer has decided the case without fulfilling the legal requirements.
(ix) That the Adjudicating officer has imposed fine and penalty on the owner of the Truck but there is nothing about the existence of Liquor in the truck therefore, the Order-in-Original is a defective Order which is required to be set aside.
(x) That the liquor found from the truck was not loaded on the Truck by the transport company they did not accept the charges levelled against the company. The persons who were arrested and produced before the Court were outsiders and they had accepted their guilt before the Honorable Special Customs Court and the Transport Company was not found involved in the transport of liquor as the same was not booked and no billty Number was assigned.
(xi) That the track record of the company is neat and clean and there was no allegation against the company during the previous tenure of their business.
5. The Departmental Representative Mr. Muhammad Fareedullah has submitted para wise Comments as follows:-
(a) Para-1 of the grounds of appeal is denied. The fact is that ample opportunity of hearing was granted to the appellant and the learned Advocate for appellant appeared before adjudication Officer on 25-3-2013 for hearing of the case. The case was adjourned to 29-3-2013 on which date the learned advocate failed to appear before the adjudication officer as such the order was passed on the basis of record available and on written and verbal submission made by the parties.
(b) Para 2 is denied on the ground that the Miscellaneous merchandise goods were seized as the same were used as covered goods for the concealment of the smuggled foreign origin whisky.
Thus being the tainted one.
(c) Para 3 is denied on the ground that the order-in-original covers four corner of law as such it is a well founded order.
(d) Para 4 is denied on the grounds that the goods were seized in accordance with the law.
(e) Para 5 is denied on the ground that notice under section 171 of the Customs Act, 1969 was served upon both the drivers who were present on spot along with smuggled whisky and other Miscellaneous merchandise goods.
(f) Para 6 is denied on the ground that the huge quantity of smuggled foreign origin whisky along with non-duty paid foreign origin merchandise goods were recovered from the Truck, as such were seized under the Law. The Customs Act, 1969 is extended to whole of Pakistan as such there is no restriction for seizure of smuggled goods anywhere in Pakistan.
(g) Para 7 denied on the ground that both the mushairnama i,e, of interception and of recovery were prepared on spot and the same are available on record, however, the same are also annexed "A & B".
(h) Para 8 is denied on the ground that the search warrant under sections 162 and 163 of the Customs Act are required to be obtained when premises/place or house is to be searched. The search of vehicle/conveyance laden with contraband do not need any warrant under sections 162 and 163 of the Customs Act, 1969 as such the search and seizure was rightly done and sections 2t s) and 16 of Customs Act, 1969 were rightly invoked. The citations quoted have no relevance with the instant case.
(i) Para 9 is denied on the ground that the contraband goods i,e, foreign origin whisky along with smuggled/non-duty paid goods were seized while the same were being transported to Lahore. As such section 177 of the Customs Act, 1969 and S.R.O. 118/83 have no relevance with the present case.
(j) Para 10 is denied on the ground that the local goods were used as covered goods for concealment of the foreign origin Whisky and other smuggled / non-duty paid goods.
(k) Para 11 is denied on the ground that the appellants could not prove the foreign origin goods as duty paid goods and under section 187 of the Custom Act, 1969, the burden of proof as to lawful authority vested with the appellant.
(1) In view of the above narrated facts it is prayed that this Honorable Tribunal may be pleased to dismissed the appeal and uphold the Order-in-Original.
6. The departmental representative was asked to show the acknowledgement receipts of service of Show Cause Notice, Notices under sections 168 and 171 as required under section 215 of the Customs Act, 1969 but he could not show the same. However, he stressed upon that appellant has not been party at the lower forum, besides no authority has been produced from the Miscellaneous goods owners as well as no proper address given.
7. We have gone through the case record and heard the rival parties. It has been observed from the record that shows cause mention the name of the appellant as well as in the order-in-original.
Hence the locus standi of the appellant stands established in as much as the fact that the case has been adjudicated without giving them the opportunity of being heard. Admittedly and evidently that Show Cause Notice, Notices under sections 168 and 171 as required under section 215 of the Customs Act, 1969 were not served on the transport company as well as the owners of Miscellaneous goods. Further the Adjudicating Officer has not provided the opportunity of hearings to the Transport Company and all the owners of Miscellaneous goods therefore, the whole proceedings were not covered under the law.
8. Most importantly, the adjudicating authority while adjudicating the case has not discussed about the liquor which has been the core point in the show cause notice whereas the other goods which as per inventory has been manufactured locally being part of the offending goods have been confiscated without giving any reason. The adjudicating officer did not impose fine and penalty on driver of the Truck for liquor who had pleaded guilty before Special Judge Customs and was punished. The impugned Order-in-Original is thus patently not a speaking order in terms of section 24-A of the General Clauses Act, 1897. The Order-in-Original is not properly worded and speaks of the judicial mind of adjudicating officer.
9. For the reasons discussed above, we observe that the locally manufactured goods and imported goods purchased from the local markets are allowed release as their confiscation has been unlawful and without any valid reason, as the documents provided have not been controverted under section 187 of the Customs Act, 1969. The value of the conveyance is reduced to Rs,10,00,000 (Rupees Ten Lac) and container Rs,2,00,000 (Rupees Two Lac) respectively. The redemption fine equivalent to 20% of the value of trailer/truck with a penalty of Rs,10,000 imposed by the Adjudicating Officer on the owner of the vehicle is upheld. The impugned order is modified to above extent and appeal is disposed of in above terms as no order to cost.
10. Order passed accordingly. 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.