ADNAN AHMED, MEMBER (JUDICIAL-II).---Through this common order, I intend to dispose off Appeals Nos. K-151 and 152/2014 filed under Section 194-A of the Customs Act, 1969 against the order of the Additional Collector of Customs, Adjudication-II (here-in-after to be referred as respondent No,3) vide No, 14/2013 dated 17.12.2013 based on similar facts.
2. Brief, facts of the case, the appellant is importer and distributor of bottled or canned fruits namely "mix fruits with syrup" and "Pine apple choice, slice in heavy syrup etc." have been importing these items from different countries and was claiming sales tax exemption under serial No, 15 to be read with Table 1 of Note 1 to the Sixth Schedule of the Sales Tax Act, 1990, the software of PaCCS and WeBOC accordingly accepted the Goods Declaration for exemption. Subsequently, the Director Project of the WeBOC amended the software and fed the Serial No, 15 to the extent of PCT mentioned in column 3 of Table, this act of his blocked the exemption available to the importer of fruit under serial No, 15 of Table 1 of the sixth Schedule. Resultant, the appellant/his clearing agent approached the Director Project with the complaint that why existing software was amended despite being correct in law and abreast him about the problem faced by them in claiming exemption under Serial No, 15 due to restriction of feeding PCT available in serial No 3 of the Table 1 while ignoring Note 1 to the Schedule. The respective official of the Directorate of Project advised the importer/clearing agent to claim exemption under serial No, 61 while ignoring the fact that the same is irrelevant, only for filing good declaration, which has to be corrected/amended accordingly by the respective assessing official at the time of passing order under section 80 of the Customs Act, 1969 and Rule 438 of Sub-Chapter III of Chapter XXI of Custom Rules, 2001. The appellant accordingly started filing goods declaration under serial No,61 of the Sixth Schedule to the Sales Tax Act, 1990. The assessing officer upon receipt of review under Rule 441 use to complete the goods declaration while allowing the exemption under Serial No, 15 with the remarks "goods are covered by the description given in serial 15 of Schedule VI, whereas corresponding PCT heading have not been given. The PCT headings are just for reference purpose and the benefit if any is allowed to the described product. In view of the situation Serial No, 61 is used GD assessed accordingly with the benefit of Schedule Sixth is admissible" and the appellant accordingly upon receipt of view message for payment of additional duty and taxes paid those and his consignments were allowed release for obtaining delivery by the competent authority under section 83 of the Customs Act, 1969 and Rule 442 of Customs Rules, 2001. That on 13.03.2013 Karachi Chamber of Commerce and Industry forwarded a letter to Chief Collector of Customs with the submission that as to whether bottled and canned fresh fruits falling under PCT 2008.2000 and 2008.9700 are exempted under Serial No, 15 to the Sixth Schedule or not and through the said letter provided a list of importer whose consignments were released while granting the exemption contrary to the Importers of the identical product who neither claimed the exemption nor were allowed and sought clarification in this regard enabling it to disseminate the same to their Members. The Deputy Collector- Group I of the MCC Appraisement -East (here-in-after to be referred as respondent No, 2) moved a file and after seeking approval of the ADC passed assessm ent order on 23.03.2013 in 7 goods declaration bearing Nos. KCSI-HC-15328-02022012, KCSI-HC-3447-15032012, KCSI-HC-69337-26052012 KCSI-HC-76836-11062012, KCSI-HC85286- 27062012 KCSI-HC-85287-27062012, KCSI-HC- 3176-24072012 and KCSI-HC-4142-26092012 with the remaiks "during monitoring it was found that the benefit of Sales Tax is extended by the assessing officer. I put forward the cases of the same in the file to ADC on 11.03.2013. The GD is reassessed to create recovery, the importer is directed to pay the amount. The issue was already taken by the Collectorate before contravention submitted by the Customs Intelligence on 18th March 2013." The appellant in exercise of their guaranteed right under Section 193 of the Customs Act, 1969 assailed the said order before the Collector of Customs-Appeals on 12.04.2013 vide No, 4627/2013 to 4632/2013 and the matter became sub-judice. Inspite of this fact that that matter was sub-judice the official of respondent No, 2 harassed the appellant for payment of Rs, 2780663.00, which he paid through pay orders .. Under cover letter dated 27.03.2013. Meanwhile the respondent No 1 forwarded contravention report dated 18.03.2013 to the respondent No, 2, who forwarded the same for issuance of show cause notice to the respondent No, 3 despite not warranted under law as reassessm ent orders had already been passed under Section 80(3) of the Customs Act, 1969, which was assailed by the appellant before the Collector of Customs Appeal No, 12.04.2013. Upon receipt of contravention report the respondent No, 3 issued show cause notice dated 25.03.2013 with the allegation that Messrs General Food Corporation, Karachi (NTN 06711497) 305-306, Al- Rehman Trade Centre, Shahra-e-Liaquat, Karachi by importing and clearing under reference consignments of canned pineapple, fruit mix, fruit cocktails of PCT 2008.2000 and 2008.9700 through undue claim of exemption of Sales Tax under S.No, 61 of the Sixth Schedule to the Sales Tax Act, 1990, evading thereby government legitimate revenue to the tune of Rs,2,780,663.00 (Sales Tax of Rs, 2,230,107.00, Additional Sales Tax amounting to Rs,481,145.00 and Income Tax Rs, 132,411.00) have committed offence of mis-declaration and fiscal fraud under sections 32(1) and (2), 32A, 79 and 80 of the Customs Act, 1969 read with Sections 3, 6 and 7A of the Sales Tax Act, 1990 further read with Section 148 of the Income Tax Ordinance, 2001, punishable under clauses (14) & (14A) of Section 156(1) of the Customs Act, 1969, read with Sections 33, 34, and 36 of the Sales Tax Act, 1990.
The appellants controverted the allegation of the show cause notice through reply dated 01.07.2013 on which the official of respondent No, 1 submitted comments dated 08.10.2013, in exercise of right to rebut the appellant submitted additional arguments through letter dated 16.11.2013 on the comments, which failed to impress the respondent No, 3 and he passed order-in-original dated 17.12.2013, paras 9 to 16 are relevant, which is reproduced here-in-below:-- "9. I have gone through the record of the case, written reply of the respondents as well as verbal heard arguments of both sides:--
10. Mr. Saud Hassan Khan, Intelligent Officer, attended as department representative i,e, Directorate General of Intelligence and Investigations - FBR, Regional Office, Karachi appeared before the undersigned and produced the copy of the Hon'ble High Court of Sindh, Karachi Judgment dated 13.11.2013 and stated Messrs General Food Corporation, have been given no relief by the Hon'ble High Court of Sindh Karachi as their petition in this regards has been dismissed.
11. In view of it, the plea of the respondent taken in his reply to the show cause notice that by virtue of filing Constitutional petition the matter stood sub-judice is no more relevant as the Hon'ble High Court of Sindh, Karachi vide judgment dated 13.11.2013 along with declaring the petitions of the respondent not maintainable has also decided the issue of availability of exemption of Sales Tax and withholding tax on imported canned fruits against the respondent. Therefore the issue which is at the core of the whole controversy involved in this case stands settled to this extent.
12. As regard the plea of the respondent that by virtue of reassessing the GDs involved in this case, the issuance of instant show cause notice amounts to double jeopardy, it is observed that reassessm ent of already cleared GDs is the jurisdiction of the clearance Collectorate under Section 80(2)(3) of the Customs Act, 19694 where it informed the importer electronically about the reassessed duties and taxes without any imposition of fine and penalty. Where the instant show cause notice has been issue in terms of Section 179 ibid read with sections 32, 156, 180, 181 of the Customs Act, 1969 for the purpose of chargeability of additional duties and taxes along with fine and penalty if any so determined by the adjudicating authority. Therefore the arguments of the respondent in this regard does not hold water when examined in the context of powers vested under Customs Act, 1969, in the hands of the Customs officers and staff.
13. Similarly the arguments of the respondent that the Directorate General of Intelligence and Investigations (Customs)-FBR does not has the powers under the Sales Tax Act, 1990 and Income Tax Laws in this regard is also not based on proper understanding of the legal scheme in this regard. The case law quoted by the respondent in this regard is in the context of initiation of criminal proceedings by lodging FIR by the department whereas the instant case pertains to assessm ent of duties and taxes not paid by the importer on the eve of import of cannot fruit consignment in automated environment of the customs clearance system where GD is prepared and filed by the importer himself after determining his liability of paying duties and taxes. It is pertinent to mention here that the automation of the customs clearance system has lead to a paradigm shift in this regard where the whole system has been designed around self assessment of duties and taxes by the importers himself against the previous system where the department used to determine the liability of duties and taxes by this context, it is gross simplification on the part of the respondent to assert that the customs is entrusted with only collection of duties and taxes other than customs. Moreover, the said judgment has been appealed against in the Supreme Court of Pakistan by the concerned Collectorate of Customs.
14. It is further observed that the respondent has alleged in his reply that the instant complaint was lodged by people of his business fraternity, who were paying sales and income tax on the import of the said item but the respondent was not paying the same despite knowing this fact. He instead challenged the leviability of these taxes and duties in the Honourable High Court, which, as stated above has decided the matter against the respondent. This shows that the respondent did not want to pay these legitimate duties and taxes and went to the extent of challenging their imposition and now vehemently contesting the same by questioning the legal powers of this department in this regard. This attitude of the respondent exhibits that he is not interested to discharged his liability to pay legitimate government revenue.
15. In the light of above, I am convinced that the charge enumerated in the show cause notice against the trader established. Therefore, the respondent is directed to pay evaded revenue amounting to Rs,418,145.00 and Income Tax Rs, 132,411/-. Since, the offending goods in this case have already been released, therefore the same cannot be confiscated at this stage. However, a penalty of Rs,500,000.00 is also imposed under Clauses (14) and (14A) of Section 156(1) of Customs Act, 1969 on the importer.
16. The clearing agent involved in this case namely Messrs AlNaseeb Traders (CHAL No, 1310), 305- 306, Al-Rehman Trade Centre, Shahrae-e-Liaquat, Karachi was also made respondent in this case.
But he neither submitted reply to the show cause notice nor appeared for hearing in view of it, the MCC (East), Karachi is advised to initiate necessary action against under the licensing rules for this delinquent attitude. Therefore, a penalty of Rs,100,000.00 is also imposed under clauses (14) and (14A) of Section 156(1) of Customs Act, 1969 on the said clearing agent."
3. The appellant Messrs General Food Corporation, Karachi has challenged the orders of the forum below by way of Appeal No, 151/2014 through Mr. Obayd Mirza/Nadeem Ahmed Mirza (Advocates/Consultants) on the strength of the grounds incorporated in the memo of appeal and which are inter alia:--
(i) The respondent No, 1 is not designated an "Officer of Inland Revenue" under Section 30A of the.
Sales Tax Act, 1990 and Section 230 of the Income Tax Ordinance, 2001 under which "Directorate General Investigation, Inland Revenue" has been designated as officer of Inland Revenue and they had been delegated powers under different section of the Sales Tax Act, 1990 through Notification No,S.R.0.77600/2011 dated 19.08.2011 and Section 207 of the Income Tax Ordinance 2001.
Resultant, respondent No, I acted without powers/jurisdiction, rendering their act of preparation of contravention report, without power and jurisdiction, hence "corum non-judice" as held in reported judgment Major Syed Walayat Shah v. Muzaffar Khan and 2 others (PLD 1971 SC 184), Omer and Company v. Controller of Customs, (Valuation): (1992 ALD 449 (1) Karachi AAA Steel Mills Ltd. v.
Collector of Sales Tax and Central Excise Collectorate of Sales Tax (2004 PTD 624), PLD 1976 Supreme Court 514 Ali Muhammad v. Hussain Buksh and others and PLD 2001 Supreme Court 514 Land Acquisition Collector, Noshehra and others v. Sarfraz Khan and others, 2006 PTD 2237, Pak Suzuki Motors Company Ltd, Karachi v. Collector of Customs, Karachi, 2009 PTD (Trib.) 1996 and 2010 PTD (Trib.) 832.
(ii) The action of the respondent No, 1 was also patently without legal mandate in terms of Notification No, 486(1)/2007 dated 9.6.2007, this notification does not empower them to exercise powers under Sections 32, 80, 83 and 195 of the Customs Act, 1969. Alleging 'clearance' of the imported consignments by way of mis-declaration in terms of section 32 ibid after the assessm ent/clearance orders were passed by the authority defined in section 2(a) and sections 80 and 83 of the Customs Act, 1969, and Rules 438 and 442 of Sub-Chapter III of Chapter XXI of Customs Rules, 2001, strictly making the whole transaction a past and closed transaction.
Resultant, respondent No, 1 acted without powers/jurisdiction, rendering their act of preparation of contravention report, without power and jurisdiction, hence "coram non-judice" as held in reported judgment Major Syed Walayat Shah v. Muzaffar Khan and 2 others (PLD 1971 SC 184), Omer and Company v. Controller of Customs, (Valuation): (1992 ALD 449(1) Karachi AAA Steel Mills Ltd. v.
Collector of Sales Tax and Central Excise Collectorate of Sales Tax (2004 PTD 624), PLD 1976 Supreme Court 514 Ali Muhammad v. Hussain Buksh and others and PLD 2001 Supreme Court 514 Land Acquisition Collector, Noshehra and others v. Sarfraz Khan and others, 2006 PTD 2237, Pak Suzuki Motors Company Ltd, Karachi v. Collector of Customs, Karachi, 2009 PTD (Trib.) 1996 and 2010 PTD (Trib.) 832.
(iii) That after passing of clearance and assessment order under Sections 80 and 83 Rules 438 and 442 of Sub-Chapter III of Chapter XXI of Customs Rules, 2001 by the authority defined in Section 2(a) ibid and 'out of charge' of the consignments, the only appropriate authority to conduct audit of the so cleared consignments rests with the 'Directorate General of Post Clearance Audit', formed under the provision of section 3DD of the Customs Act, 1969, and empowered under Notification No,500(I)/2009 dated 13.06.2009 and to issue audit observation and thereafter prepare contravention report for the purpose of adjudication by the competent authority empowered under the provision of section 179 of the Customs Act, 1969, after issuance of proper Show Cause Notice under section 180 ibid. The respondents figure nowhere in the respective provision of the Customs Act, 1969, nor in the Notification No, 500(1)/2009 dated 13.06.2009. By laying hands on the consignments which have been cleared after passing of valid assessment and clearance order by the competent authority under the referred in above provisions of the Act/Rules, 2001, the respondents tried to conduct audit of the consignments after clearance for which they are not empowered. By transgressing the powers and jurisdiction of the Directorate General of Post Clearance Audit, they acted without powers/jurisdiction rendering their acts abinitio void and as such corum-non-judice. Reliance is placed on PLD 2001 Supreme Court 514, PLD 1976 Supreme Court 514, PLD 1971 SC 184, 2006 PTD 2237, 2001 SCMR 1822, PLD 2004 Supreme Court 600, PLD 2005 Supreme Court 842, 2009 PTD 1083, PLD 1995 Kar. 587, PLD 1973 SC 236 and PLD 1971 SC 197.
(iv) That apart from the above issue of jurisdiction of the respondents Nos.1 and 2, even respondent No,3 is not designated as officer of 'Inland Revenue' under the provisions of clause (c) subsection
(3) of section 25 of the Sales Tax Act, 1990 and Section 207 of the Income Tax Ordinance, 2001 thus not empowered to issue a 'Show Cause Notice' (SCN), in the matters of Sales Tax under Section 11.
(erroneously mentioned as 36 as it stood deleted through Finance Act, 2012) of Sales Tax Act, 1990 and Section 162(1) of the Income Tax Ordinance, 2001. By doing so, the respondent No, 3 usurped the powers of officers of 'Inland Revenue'. In other words, even very issuance of SCNs and then Orders-in-Original are flagrant violations of law. Hence corum non judice and ab initio null and void and of no legal effect/consequences. Reliance is placed upon PLD 1971 SC 184 Major Syed Walayat Shah v. Muzaffar Khan and 2 others, 1992 ALD 449(1) Omer and Company v. Controller of Customs (Valuation) Ali Muhammad v. Hussain Buksh and others PLD 1976 Supreme Court 514 and PLD 2001 SC 514, PTCL 2008 CL 37(sic) Messrs Al-Faiz Industries (Pvt.) Ltd. And others, C.P. No,D- 216/2013 Messrs Lucky Cement Ltd. Karachi v. Federation of Pakistan and others: "The word emphasized could be regarded as being in the nature of deeming provisions. If so, then (subject to the rules of interpretation that apply in such a situation) that nature of sales tax or excise duty on imports, for purpose of levy, charge or collection (as the case may be), may be regarded as a customs duty. Clearly, this would be a materially different situation than that which obtains in relation to advance income tax on imports. In our view, the jurisdiction of the customs authorities (i,e, the Collector of Customs) is limited to only the collection of the advance income tax. Furthermore, subsection (6) of section 148 emphasizes that provisions of the Customs Act apply only to the Collection of the tax and that too, only in so far as is relevant.
Since there is a clear distinction between the collection of a tax on the one hand and its recovery or enforcement on the other, in our view, the provision of the Customs Act as relate to the latter are not applicable in relation to the jurisdiction conferred on the Customs Authorities under section 148."
(v) That it is also of great importance for the appellant to state that after the transmitting of the Assessm ent Orders (AOs) against 07 consignments of the appellant SCN No, ADJ-II/Add.
Coll/DITKHI/CONT-APPG-9/General Food/2013/02 dated 25.06.2013 and Order-in-Original No, 04 of 2013 dated 11.12.2013 are nullity in the eyes of law as under the provision of Section 193 of the Customs Act, 1969, as amended through Finance Act, 2012, an Officer of Customs is also given the right to file an appeal before the Collector of Customs (Appeal), under section 193 ibid against an assessm ent/clearance order passed under sections 80 and 83 of Customs Act, 1969, and Rules 438 and 442 of Sub-Chapter III of Chapter XXI of the Customs Rules, 2001, by the authority as defined in section 2(a) ibid and the proper course of action available with the respondent No, 2 was to file appeals against the AOs, within 30 days, which was not done thus the AOs attained finality and the transaction stood passed and closed and no authority or the Court is empowered to disturb that as held by this Honourable Court in judgment reported as Director, Directorate General of Intelligence and Investigation and others v. Messrs AL-Faiz Industries (Pvt.) and others (PTCL 2008 CL 37(sic)).
(vi) That even otherwise the reassessment under subsection (3) of section 80 of the Customs Act, 1969, is only permitted after calling for the documents as per section 2 ibid, after release of the goods and the declaration or documents or any information or statement so furnished is found to be incorrect in respect of earlier assessment. In the absence of availability of any mis-declaration, mis-statement false documents/statement, reassessment is not permitted as evident from assessm ent note dated 23.03.2013 of the subordinate of respondents Nos. 2 that no mis- declaration in material particular was found in the declaration or documents scanned forming part of the declaration in terms of Section 2(kka) after receipt of view messages from the subordinate of Respondent No,2 under Rule 437 ibid by the petitioner, rendering the reassessment orders passed by the Deputy Collector (Group-I), a subordinate respondent 2, as nullity and against the provisions of section 80 of the Customs Act, 1969.
(vii) That with the passing/transmitting of "Assessment/Clearance Orders" by the authority defined in section 2(a) of the Customs Act, 1969, under sections 80 and 83 ibid and Rules 438 and 442 of the Customs Act/Rules, 2001, the transaction stood 'past and closed' in every aspect, and the said order could had been assailed by the officers of Customs under Section 193(1) of the Customs Act, 1969, which was not done. Instead the Deputy Collector of Customs, Group-1, a subordinate of respondent No,2, passed 2nd AOs, substituting the infield orders, which is not permitted as a subsequent order cannot be allowed to pile upon existing orders, as it is not permitted under law besides the said exercise amounts to "double jeopardy" and negates the provisions and safeguards of Article 13 of the Constitution and as per law laid down in reported judgment 1989 MLD 4310 World Trade Corporation v. Central Board of Revenue and 2004 PTD 3020 Smith Kline French v.
Pakistan.
(viii) That, without prejudice, it is imperative for the appellant to state that where the words are plain and unambiguous, the intent can be best judged by giving full effect to the ordinary grammatical meaning of those words, meaning there by that where the context and the language resolve the meaning, resort to object and purposes is uncalled for, as held in many reported judgments; e.g. NLR 1989 SCJ 29(sic), 1987 SCMR 1107.
(ix) It is also golden principle of interpretation of statue that until and unless any contrary intention can be inferred expressedly or impliedly the word used in the statue are to be given their plain meaning in the ordinary course, as per which imported fruits, bottled or canned, are exempted from the payment of sales tax. Under Serial No, 15 of Table 1 read with Note 1 (meant for imports only) and the same reads as under:-- "Edible Fruits excluding imported fruits (except fruits imported from Afghanistan) whether fresh, frozen or otherwise preserved but excluding those bottled or canned, and
(x) That despite plain language of the Serial No, 15 of Table 1, without examining the Note 1 and Table II (for supply) of the Sixth Schedule to the Sales Tax Act, 1990, the respondents while merging the Table II in Table I implied extra words in the Serial No, 15 interpreted it as 'exemption is applicable to local supply and not imports, but import from Afghanistan are exempted, exemption is applicable irrespective of preservation method, but local supply and Afghan imports are not exempted if bottled or canned," through their own adopted principle of interpretation while ignoring the well settled law that the tax statutes are to be interpreted in light of what is clearly expressed. In case of ambiguity or doubt arising from construction, benefit must go to the tax payer. Thus no other meaning can be given to the said Serial Number 15 of Table 1 read with Note 1 with the exception of its spirit and nothing can be added or subtracted, meaning thereby that "in interpreting the taxing statute the customs must look to the words of the statute and interpret in the light of what is clearly expressed. It cannot imply anything which is not expressed, it cannot import provision in the statute so as to support assumed deficiency. There is no room for intendment. There is no equity about a tax. There is no presumption as to tax nothing is to be read in, nothing is to be implied. One only look fairly at the language used nothing else to be done" as held by High Courts and this Honorable Court in many judgments, such as 1989 CLC 1463 (Abassi Steel Industries Ltd. v. Collector of Customs), 2011 PTD (Trib.) 79, (Messrs Fazal Ellahi v. Additional Collector of Customs).
(xi) Even otherwise, if there are two or more interpretations of a provision pertaining to levy of tax on account of anomaly/ambiguity, the one favorable to tax payer has to be adopted by the Court.
This is as per judgments reported as 1993 SCMR 274, 2005 SCMR 728, 2007 PTD 1656 and 2008 PTD 1227.
(xii) That the denial of exemption in terms of Serial No, 15 of Table 1 and Note 1 of Sixth Schedule to the Sales Tax Act, 1990 on the basis of arbitrary and illegal interpretation made by the respondents is void and contrary to the expression and law laid down by the superior judicial fora. In accordance with which no other meaning can be given to the word "but" and "excluding" except their literal meaning, which is clear as no definition of these words is given in Section 2 of Sales Tax Act, 1990. Resultantly, plain and unambiguous meaning has to be adopted or dictionary meaning of standard dictionary for assigning the meaning of these words. Thus the exemption is allowed to bottled/canned fruits imported from any country, without any exception.
(xiii) That if the faulty interpretation made by the respondents is accepted then it would render whole of the Sixth Schedule including Serial No, 15 as redundant and would create great hardship for the appellant as well as to other importers as Sixth Schedule is granting exemption to goods falling in column 2. Neither the intention of legislature nor of FBR was/is as per the interpretation of the respondent, and the said fact stood validated from the Press Release dated 29.06.2013 of the FBR at the web page of FBR that no Sales Tax is payable on fruits and letter of FBR dated 06.04.2010 and 28.05.2010 and the judgment dated 19.08.2010 of Honorable High Court, in C.Ps. Nos. D-2172 and 2799 of 2009 and 09, 174505 and 607 of 2010, wherein it was ruled/held that 'Palms Nuts' and 'Kernal', falling under PCT heading 2305.6000 are exempted under Serial No, 28 of Table 1 of the Sixth Schedule, if read with Note 2 to the Schedule irrespective of the fact that nor column 2 neither column 3 contains the declared description and PCT heading.
(xiv) That the show cause notice in the instant case was issued on 25.06.2013 by the respondent No, 1 and an order under the proviso of subsection (3) of Section 179 of the Customs Act, 1969 should had been passed by him within 120 days i,e, on or before 23.10.2013 from the date of show cause notice or within a further extended period of 60 days by the Collector of Customs, prior to lapse of initial period of 120 days after serving a notice to the person concerned and thereafter recording reasons for the extension based on "exceptional circumstances" as held by Hon'ble Supreme Court of Pakistan in reported judgment 1993 SCMR 1881 Khalid Mahmood v. Collector of Customs. In the instant case the period for passing order stood lapse on 23.10.2013 without any extension as evident from the operative paras of the order. Notwithstanding, if it is presumed for the sake of argument, the Collector did extended the period, even then i,e, not valid as the same was without issuance of notice to the appellant prior to according extension and nullity to the provision of subsection 179(3) as no exceptional circumstances and neither those were recorded as per law laid down by the Superior Judicial Fora in umpteenth reported judgment, resultant, the extension void, ab-initio and hold no ground. Rendering the order-in-original dated 11.12.2013 barred by time by 50 days, hence without power/jurisdiction and not enforceable as held in reported judgments 2008 PTD 60 Messrs Super Asia Muhammad Din Sons (Pvt.) Ltd. v. Collector of Sales Tax Gujranwala and 2008 PTD 578 Messrs Hanif Strawboard Factory v. Additional Collector (Adjudication) Customs, Sales Tax and Central Excise Gujranwala, 2009 PTD 762 Messrs Tanveer Weaving Mills v. Deputy Collector Sales Tax and 4 others 2009 PTD (Trib.) 1263 and Messrs Syed Bhai Lighting Limited, Lahore v. Collector of Sales Tax and Federal Excise, Lahore and 2 others 2009 PTD 1978, Leo Enterprises v.
President of Pakistan and others, 2010 PTD (Trib) 1010 Innovative Impex v. Collector of Customs, Sales Tax and Federal Excise (Appeal), 2011 PTD (Trib) 79 Fazal Ellahi v. Additional Collector of Customs, MCC of PaCCS, 2011 PTD (Trib) 987 Unique Wire Industries v. Additional Collector of Customs, MCC of PaCCS, 2011 PTD (Trib.)1146 Kaka Traders v. Additional Collector of Post Clearance Audit and 2012 PTD (Trib.) 1650 Electron Ltd., v. Collector of Customs, Lahore and others.
(xv) The order passed by the respondents shows that it is not a proper orders without application of judicial mind and provision of the Act. Instead these are non speaking orders and did not confirms to the mandated requirement of section 24-A of the General Clauses Act, 1897 and this stood validated from the order containing no proper rebuttal substantiated with the authority of the Superior Judicial Fora on the pleas of the appellant taken in reply to the show cause notice dated 01.07.2013 and additional arguments dated 16.11.2013 on the comments of the respondent No, 1, instead the basis of order is the order of Hon'ble High Court of Sindh, which is presently impugned before the Hon'ble Supreme Court of Pakistan through a Civil Petition. Orders which did not contains rebuttal on the ground advanced and decision/judgments relied upon by the appellant and also not containing substantial reasons and did not shows that these were passed on objective consideration shall always be 'treated as illegal, void arbitrary and a result of misused of authority vested in public functionary. No room was available for such illegal, void and arbitrarily orders in any system of law. If any authority Court or Tribunal gave a finding of fact which was not based on material available on record was illegal arbitrarily without discussing and considering the material available on record it became perverse and a perverse finding of fact which is violative of the established principle of appreciation of evidence on record was not sustainable in law. The principle that every judicial or quasi-judicial finding should be based on reasons containing the justification for the finding in the order itself is an established principle of dispensation of justice. The Adjudication order is being violation of basic principle of the goods governance and mandatory requirement of Section 24A of the General Clauses Act, is not only illegal and void but also not sustainable under law. The said position is also fortified by the judgments of Superior Courts reported as 2005 YLR 1019, 2007 PTD 2500, 2004 PTD 1973, 2005 YLR 1719, 2003 PTD 777, 2003 PTD (Trib) 2369, 2002 MLD 357, 1983 CLC 2882, 2005 PTD 2519, 2005 PTD 1189, 2003 PTD 2369, PLD 1995 SC (Pak) 272, PLD 1970 SC 158, PLD 1970 SC 173, 1984 SCMR 1014 and 2012 PTD (Trib.) 619.
(xvi) The appellant carves his right to add any fresh grounds at the time of hearing beside placing any valid incriminating evidence/documents
4. Whereas, for Messrs Al-Naseeb Traders, Karachi in Appeal No, 152/2014 argued in line with the arguments referred in para 3(i), (iv) & (v), with the exception of the enumerated herein-below:--
(a) That as regards to collusion for obtaining clearance of 07 consignments of Messrs General Food Corporation, Karachi while submitting good declaration is without any substance by virtue of the fact that appellant filed the goods declaration on the basis of the import documents supplied by Messrs General Food Corporation, Karachi, and those were attached with the filed goods declaration under section 79(1) of the Customs Act, 1969 and Rule 433 of Sub-Chapter III of Chapter XXI of Customs Rules, 2001 and the assessments orders were passed by the competent authority defined in Section 2(a) of the Customs Act, 1969 under the power vested vide Notification No, 371(I)/2002 dated 15.06.2002 under Section 80 and Rule 438 after calling documents through view messages in terms of Rule 437, which formed part and parcel of the declaration earlier transmitted online in terms of definition given in Section 2(kka) of the Customs Act, 1969 and after filing of reviews against the assessm ent order passed by the Appraiser in terms of Rule 441. Consequent to which the inbuilt authority in WeBOC passed clearance order under Section 83 and Rule 442 ibid and this proposition of law stood validated from the reported judgment 2011 PTD (Trib.) 22 and 2011 PTD (Trib.) 987. For ease Section 2(kka) is reproduced here-in-below:-- [2{kka} "documents means a goods declaration, application for claim of refund, duty drawback or repayment of duty, import or export general manifest passenger manifest, bill of lading, airway bill, commercial invoice and packing list or similar other forms or documents used for customs clearance or making a declaration to customs, whether or not signed or initialed or otherwise authenticated, and also includes:-- i) any form of writing on material, data or information recorded, transmitted, or stored by means of a tape recorder, computer or any other device, and material subsequently derived from information so recorded, transmitted or stored; ii) a label, marking or other form of writing that identifies anything of which it forms part or to which it is attached by any means; iii) a book, map, plan, graph or drawing, and iv) a photograph, film, negative, tape or other device in which one or more visual images are embodied so as to be capable (with or without the aid of some other equipment of being reproduced; and)]
(b) That the appellant in the capacity of clearing agent has no part to play. The entire transaction is between exporter/importer and the customs. The clearing agent only provides services to the exporter/importer on very nominal charges and extends cooperation to the customs officials for carrying out their job i,e, examining the consignment in terms of Sections 198 and 80 of the Customs Act, 1969 and the rules and regulation framed there-under. To be most precise, a clearing agent act as a post office or transit station between these two.
(c) That in support of the above submission. It is felt appropriate to place reliance on the judgment of Customs, Excise and Sales Tax Appellate Tribunal,. Karachi in a similar nature of cases pertaining to Messrs Shoaib Enterprises, Karachi and Sakro Corporation, Karachi, wherein in Order-in- Appeals Nos. K-1833/01 dated 19.01.2002 and K-538/2003 (K-2) dated 25.10.2003, it has been held that provisions of section 209 of the Customs Act, 1969 provide immunity and limited liability against the agent and an agent cannot be charged for misdeclaration under section 32 of the Customs Act, 1969 if he filed documents under the provisions of Customs Act, 1969 in accordance with the export documents and further held that the action taken by the customs of charging agent and thereafter leveling penalty without any fault or default on his part is not only unfair but also illegal. The Lahore High Court in the case of Messrs Ports Ways Custom House Agent and another v. Collector of Customs and another reported at 2002 YLR 2651 held that:-- The imposition of penalty on the Clearing Agent/appellant No,1 was all the more unjustified. To hold the clearing agent liable for the act of commissions and omissions on the part of the importer will require a clear finding based upon legally acceptable evidence of his being an active and conscious party to the manipulation. In normal course of his business, a Clearing Agent, files a bill based upon the document and information provided by the importer. He cannot be presumed to be a privy to any illegal arrangement, which the importer may have coined or had intended in his mind. For that purpose some evidence of his direct involvement will have to be brought on record. Particularly when it is not shown that the Clearing Agent was directly or indirectly a beneficiary of invasion of taxes. In the present case no attempt whatsoever was ever made to bring home guilt to the Clearing Agent. The appeal is accepted to the extend of Clearing Agent.
(d) The respondent No,2 passed the Order-in-Original in very wanton and haphazard manner in the case of appellant, which stood proved from the fact that he applied the order passed in the case of Messrs General Food Corporation, Karachi on the case of appellant without distinguishing the act and contravention of the Act by the appellant during the course of clearance. Application of an order on the case of other person is barred under law as per ratio settled by the Superior Courts of Pakistan that every case has its peculiar facts merit demerit and arguments, an adjudicating authority has to consider those and thereafter passed an order as he deems fit.
Reliance is placed on reported judgment 2011 PTD 2849, 2011 PTD (Trib.) 424. This legal lacuna alone is enough for declaring the orders nullity to law, and as such of no legal effect.
5. No cross-objection were submitted within the stipulated period given in subsection (4) of Section 194A of the Customs Act, 1969 either by respondent No, 1 or 2, instead para wise comments dated nil were submitted by Mr. Saud Hassan Khan, Intelligence Officer, which are taken for consideration with the exception of facts of the case which are admittedly the same as stated in para 2 of the order and which read as follows:
(i) Contents of para are denied as mis-leading. The levies of import stage on imported goods including sales tax and income tax are to be collected enforced and recover by the Clearance Collectorate of the Customs in the same manner as it were duty of customs in terms of section 6 of the Sales Tax Act, 1990 and Section 148 of the Income Tax Ordinance, 2001. Inland Revenue Authorities have no role in collection and recovery of levies on imported goods at import stage. In case of evasion of any levy through mis-declaration or fiscal fraud by unlawfully availing any exemption through Automated Customs Clearance system, the importers are liable for action under sections 32(1) and (2) and 32A of the Customs Act, 1969 for adjudgement and recovery of evaded amount through course of adjudication and recovery of evaded amount/ quasi judicial proceedings in terms of section 179 ibid. Further, Section 202 of the Customs Act, 1969 fully empowers Clearance Collectorate to recover evaded amount of duty as well as other taxes leviable on imported goods but evaded at import stage.
(ii) Contents of para are mis-leading. The Directorate General of Intelligence and Investigation-FBR is fully empowered to report any case of evasion of duty and taxes at import stage to competent adjudication authority for taking cognizance under relevant provision of Sections 32 and 32A of the Customs Act, 1969. Submission of contravention report, does not mean that Directorate General exercise powers under aforesaid Sections. Even any law biding citizen of Pakistan can report any case of evasion to Clearance Collectorate or competent adjudication authority for taking cognizance thereon for recover of evaded amount it is denied that the import transaction became past and closed after assessm ent or clearance thereof. In cases of evasion through mis- declaration and fiscal fraud provision of Sections 32(1) & (2) and 32A read with the provision of Section 179 of the Customs Act, 1969 duly provide appropriate course of action through issuance of show cause notice within 05 years of the clearance of the goods for recovery of evaded amounts and imposition of penalties on defaqlter importers and their associates involved in evasion. The precedent cases referred in the para are not relevant to applicants case.
(iii) Contents of the para denied. It is not true that only Directorate of Post Clearance Audit is competent to detect and report cases of evasion of duty and taxes to competent adjudication authority and no other agency or person can point out or report such cases. The Directorate General of Intelligence and Investigations---FBR is fully empowered to unearth/detect investigate and report cases of evasion through mis-declaration and fiscal fraud to concerned clearance Collectorate or competent adjudication authority for taking cognizance/ warranted action under the relevant provisions of law.
(iv) Contents of the para are denied. The adjudication authority is fully empowered to adjudicate cases involving recovery of duty and taxes. The relevant provision of Section 179 of the Customs Act, 1969 are reproduced as follows:-- "179 Power of Adjudication (i) subject to subsection (2), in cases involving confiscation of goods or recovery of duty and other taxes not levied short levied or erroneously refunded imposition of penalty or any other contravention under this Act or the rules made there under the jurisdiction and powers of the officer of customs in terms of amount of duties and other taxes involved excluding the conveyance, shall be as follows namely:
(i) Collector no limit
(ii) Additional Collectornot exceeding three millions rupees.
(iii)Deputy Collectornot exceeding one million rupees.
(iv) Assistant Collectornot exceeding five hundred thousand Rupees.
(v) Superintendentnot exceeding fifty thousand rupees.
(vi)Principal Appraisernot exceeding fifty thousand rupees. Further, the provisions of Section 6 of the Sales Tax Act, 1990, and Sections 148 and 162(2) of Income Tax Ordinance, 2005 duly empower collector of customs to levy, enforce, collect and recover the evaded amount of sales tax or income tax as chargeable on imported goods at import stage. The Inland Revenue authorities having neither control over clearance of imported goods nor having records thereof have no role in collection and recovery of levies of import stage. The case law relied is not relevant to appellant's case.
(v) Contents of the para are denied. The contention raised in the para is an attempt to twist the fact on mere technical grounds. The actual issue involved in the matter is whether exemption of sales tax is admissible to impugned consignments of canned pineapple or otherwise. The issue has already been decided by the Hon'ble High Court of Sindh that no exemption of sales tax is admissible to the aforesaid category of edible fruits imported by the appellant since, the exemption was unduly and unlawfully availed by the appellant, they have committed the act of misdeclaration and fiscal fraud. The case has been correctly adjudicated by the competent adjudication authority vide impugned order-in-original which is justified for the reasons stated therein. The recovery of leviable taxes cannot be waived on the pretext of any sheer technicalities when appellant has factually no tenable grounds to agitate against the findings of the adjudication authority. The plea that Collectorate should have filed appeal under section 193 of the Customs Act, 1969, against assessme nt order of assessing officer and since no such appeal was filed the transaction became past and closed, its totally based on whimsical and misconceived perception. No case of mis-declaration/evasion becomes past and closed transaction of cognizance is taken within five years of clearance of goods in terms of section 32(1) and (2) of the Customs Act, 1969 or within six months of dettection of the fraud in terms of section 32A ibid.
(vi) Contents of the para are denied. The unlawful availing of any exemption on imported goods cleared through automated Clearance system tantamount to clear mis-declaration. Reliance is placed on judgment of Hon'ble Supreme Court of Pakistan in Civil Appeals Nos. 332 to 382/2012. In the referred case wrong. PCT of imported goods was deliberately declared to avail exemption of duty and taxes. The department took cognizance under Section 32 of the Customs Act, 1969. It was contended by the aggrieved importers that it was responsibility of the Customs to correct the declaration at the time of import. The Hon'ble Supreme Court of Pakistan did not agree with the contention as admittedly the importers availed Automated System of assessment and it was subsequently found that wrong declaration in respect of PCT was made to evade custom duty, etc hence, the department/adjudication authority as well as appellate forum below on having taken into consideration the factual as well as legal facts rightly concluded that there was a mis- declaration therefore the show cause notices were rightly issued in terms of Section 32 of the Customs Act, 1969.
(vii) Contents of the para are denied. The supervisory officers of each assessing Group of clearance Collectorate are fully empowered to over-rule/rectify any assessment incorrectly made by any sub-ordinate assessing staff through administrative measures rather to file "appeal" before Collector of customs (Appeals) against sub-ordinate assessing staff. It is not correct that all assessm ents made by the sub-ordinate assessing staff attain finality if superior officer do not file any "appeal" against such orders. The appellant's contention is based on whimsical perception of law and practice. The allegation of double jeopardy is totally practice. The allegation of double jeopardy is totally false and unsupported. The precedent case referred in the para is not relevant to appellant's case.
(viii) Contents of the para are incoherent to appellant's case and rather reflect a meaningless contention. It is not clear to which specific ambiguity is being referred by the appellant to create a valid ground for appeal. Apparently, para needs no comments.
(ix) Contents of the para are denied. Plain reading of the provisions contained in S.No, 15 of Table 1 of Sixth Schedule are quite clear that exemption is not available to imported edible fruits with the exception of those imported from Afghanistan whether fresh, frozen or otherwise preserved but excluding bottled or canned The Hon'ble High Court of Sindh vide its Judgment dated 13.11.2013 in C.P's. Filed by the appellant and three others has categorically interpreted the above provisions word by word, which is reproduced as under:- "9- To our understanding the arguments of the respondents in respect of non-maintainability of these petition have sufficient force as the present petitions have been filed without exhausting/availing the remedy of appeal provided under section 193 of the Customs Act 1969.
Hence under these circumstances the petitions are not maintainable.
10- The second issue relates to the correct interpretation of S.No, 15 of Table 1 to Sixth Schedule of Sales Tax Act, 1990, for ready reference same is reproduced as under:-- Sr.
NoDescription Heading Nos. of the first schedule to Customs Act, 1969 15 Edible fruits excluding Imported Fruits (except Fruits imported from Afghanistan) whether fresh, frozen or otherwise Preserved but excluding those bottled "[or] canned [*]0803.000, 0804.1010, 0804.1020, 0804.2000, 0804.3000, 0804.4000, 0804.5010, 084.5020, 0804.5030, 0805,1000, 0805.4000, 0805.2090, 0805.4000, 0805.5003, 0805.9000, 0806,1000, 0806.2000, 0807.1100, 0807.1900, 0807.2000, 0808.1000, 29(0808.3000, 0808.4000), 0809.1000, 0809.2000, 0809.3000, 0809.4000, 0810.1000, 0810.2000, 30(*)
0810.4000, 0810.5000, 0810.6000, 0810.9010, 0810.9090, 0811.1000, 0811.2000, 0811.9000, 0813.1000, 0813.2000, 0813.3000, 0813.4010, 08.13.4090
11. The perusal of afore-mentioned provisions (provisions contained in S.No, 15 of Sixth Schedule reveals that its language is quite clear and unambiguous. However, by applying the principle of "Reading Down" the column No, (2) of Sr. No, 15 of Table 1 of Sixth Schedule of Sales Tax can be read as follows:-- "Edible Fruits excluding imported fruits Exemption is applicable only to local supply and Not to imports.
(except fruits imported from Afghanistan)
But imports from Afghanistan are exempted Whether fresh frozen or otherwise preserved Exemption is applicable irrespective of preservation method.
But excluding those bottled or canned.
Both local supply and Afghan imports are not exempted if bottled or canned.
12. Thus it is clear that from all angles it cannot be interpreted for allowing exemption to the subject consignments. The exemption of Sales Tax is only available to the edible fruits excluding imported fruits with exception of fruits imported from Afghanistan whether fresh, frozen or otherwise preserved but excluding those bottled or canned of PCT heading referred hereinabove. As such no exemption is available to Tinned/bottled or canned fruits. In view of above discussion it is established that neither the petitions are maintainable under the law, nor there is any exempted available for the subject consignments as per Sr.No 15 of Table 1 of Sixth Schedule of Sales Tax Act, 1990.
13. These are the reasons for short order dated 21-10-2013 whereby these petitions were dismissed along with listed applications."
In view of above mentioned judgment of the Hon'ble High Court of Sindh, no further interpretation in the matter is required. Even otherwise, as per Golden Principle of interpretation of Statute in tax matters, the provisions relating to exemption of tax are strictly construed in favour of taxing authorities and can not . Be stretched in any manner to allow exemption which are not admissible as per law.
(x) Contents of the para are denied. The provisions of S.No, 15 are unambiguous and clearly expressed. The interpretation given by appellants consultant is totally based on mis-conceived, muddled and tangled contention which is not tenable. Detailed reply as given in the above paras.
(xi) Contents of the para are denied. There is no anomaly or ambiguity in the relevant provisions of S.No, 15 of Table-1 to Sixth Schedule. The case law referred is irrelevant.
(xii) Contents of the para are denied. Detailed reply as given in the above paras.
(xiii)Contents of para are denied. The precedent case referred in the para has no relevance to appellant's case.
(xiv) Contents of the para are denied. Para 6 of impugned Order-inOriginal is quite clear. The show cause notice was issued on 25.06.2013. The period of 120 days as provided in subsection (3) of Section 179 of the Customs Act, 1969, for conclusion of adjudication proceedings was said to expire on 23.10.2013, however, an extension of 60 days upto 22.12.2013 was granted by the competent authority Collector of Customs (Adjudication-II) in exercise of powers conferred under aforesaid section. The order-in-original dated 11.12.2013 was, therefore, issued well within the stipulated extended period, it is pertinent to mention that even further extension upto one month is admissible under proviso to subsection (3) of section 179 of the Customs Act, 1969 on account of time taken through adjournment by the petitioner. As per practice, the reasons for extension by Collector of Customs are normally recorded in the relevant file. There is no mandatory condition in the aforesaid provisions for serving a notice to the parties prior to granting of extension nor there is any obligation "exceptional circumstances". The appellant's plea is neither supported by facts nor by law, hence, not tenable.
(xv) Contents of the para are denied. The order impugned is a proper speaking and well reasoned order supported by facts and law and contained necessary rebuttal to all relevant objections raised by the appellants. The written arguments as well as additional arguments put forth by the appellants consultant and department's representative have been duly considered and impugned order of adjudication authority is totally based on judgment of Hon'ble High Court of Sindh in Constitution petitions filed by appellant and three other importers. It is pertinent to mention that petitions filed by appellant and three other importers. It is pertinent to mention that said constitution petitions were filed by the appellants and three other importers inter alia seeking following relief:-- a) To delare the import of tinned, bottled or canned fruit are entitled for exemption from sales tax in terms of S.No, 15 and Note 1 of Sixth Schedule to Sales Tax Act, 1990. b) To declare that demand of sales tax on the imports of tinned, bottled or canned fruits by the respondents it arbitrary, illegal unwarranted and mala fide. c) To declare that respondents have interpreted inaptly the provisions of S.No, 15 of Sixth Schedule of Sales Tax Act, 1990 by linking the availability of exemption to PCT headings in column 3 of the said schedule instead of description in column 2 thereof. d) To declare that the tinned, bottled or canned fruit mentioned in column 2 at S.No, 15 of Sixth Schedule of Sales Tax Act, 1990 are entitled to exemption to sales tax mentioned in column 2 without reference to PCT headings mentioned in column 3 thereof. e) To direct the respondents Nos. 2 and 3 (Directorate General Intelligence and Investigation-FBR) to lift the hold from the consignment of the pertinent and respondent No, 4 (Collector MCC PaCCS) to unblock the User ID of the petitioner's company as putting on hold and blocking of User ID was unwarranted and as such of no legal effect. f) To set aside the impugned contravention report bearing No, Appg--/Complaint/R&A/Cont/2013/3572 dated 18.03.2013 and direct the respondent or any person/authority acting on behalf of the said respondent not to take any coercive action and harassm ent of petitioner and his staff till the final decision of the case. g) Unquote h) Unquote In view of the relief prayed by the appellant, the Hon'ble High Court deliberated the issue at depth on merits and held that since departmental remedies were not exhausted the petitions were not maintainable and further the provisions of S. No, 15 of Table 1 to. Sixth Schedule of Sales Tax Act are quite clear and unambiguous whereby no exemption of sales tax is available to under reference consignments of canned pineapple imported by appellant the appellants being aggrieved with the judgment of Hon'ble High Court of Sindh filed Civil Appeals Nos. 2163 to 2166/2013 in the Hon'ble Supreme Court of Pakistan the appeals were disposed off vide order dated 12.02.2014 with the observation that customs authorities shall proceed to decide the matter strictly at mandated in law and rules uninfluenced by any finding on merits of the case rendered in the judgments of the Hon'ble High Court. Since the law is very clear regarding non admissibility of exception of sales tax to imported canned pineapple, the adjudication authority has correctly passed of evaded amount onimpugned consignments. Since the impugned consignments were cleared through Automated Clearance system, the appellant who availed exception of sales tax unlawfully have committed offence of mis-declaration and fiscal fraud. Hence, besides recovery of evaded amounts penalty was correctly imposed by the adjudication authority vide impugned order in original.
(xvi) Contents of the para are denied.
6. On the date of hearing conducted on 22.09.2014 Mr. Nadeem Ahmed Mirza Consultant and Mr. Obayd Mirza Advocate argued the case strictly in accordance with the grounds of appeal referred in para, whereas Mr. Saud Hassan Khan, Intelligence Officer in accordance with the comments on appeal given in para 5 with the exception that the issue involved in the instant appeal has already been decided by the Hon'ble High Court of Sindh vide order dated 21.10.2013 vide in C. Ps. Nos.D- 1249/2013, D-1456/2013, D-1715/2013 D-1817/2013, gist of which is incorporated in their comments. Mr. Kousar Hussain Appraiser adopted the arguments of Mr. Saud Hassan Khan. In rebuttal the Consultant/ Advocate presented the order of the Hon'ble Supreme Court of Pakistan dated 03.02.2014 against the order of the Hon'ble High Court of Sindh in C.P. Numbers referred by Mr. Saud Hassan Khan and copy of which has been annexed by him as Annex- E in the comments and the order of the Hon'ble Supreme Court read as follows:-- "Learned counsel for the petitioner inter-alia contended that the impugned judgment is not sustainable because having held that petitioner had alternate remedies under the Customs Act, 1969 the learned High Court could not have not gone into the merits of the issues raised. Learned counsel for the petitioner on query submits that he has already availed the department remedy by appearing before the competent authority in customs hierarchy pursuant to the show cause notices issued regarding issues subject matter of these 04 petitions. At that he would not press these petition if these are dispose with the stipulation that any observation made in the impugned judgment shall not affect the merit of their cases before the competent authority in the customs hierarchy.
2- The request being made is reasonable. In the afore-referred circumstances these petitions are disposed off with the observation that the customs authorities shall proceed to decide the matter strictly as mandated in law and rules un-influenced by any finding on the merit of the case rendered in the impugned judgment.
7. Rival parties heard and case record perused along with the citation relied upon. I take up the case for decision strictly as ordered by the Hon'ble Supreme Court of Pakistan in its order dated 03.02.2014 to decide the matter strictly as mandated in law and Rule uninfluenced by any finding on the merit of the case rendered in the impugned judgment of the Hon'ble High Court of Sindh in C.P. No, 2164/2013 and frame following issues for determination.
(i) Whether record of the importer and of the Good Declaration post clearance fall within the domain of Official of respondents Nos. 1 and 2 in the presence of Section 3DD of the Customs Act, 1969 and Notification SRO. No, 500(1)/2009 dated 13 . 06 . 2009?
(ii) Whether officials of respondent No, 1 are empowered to take cognizance in the matter relating to Sections 32(1) & (2), 32A, 79 and 80 of the Customs Act, 1969 in terms of Notification S.R.O. No, 486(I)/2007 dated 15.06.2007 and prepare Contravention report against the consignment which has undergone the process of passing of assessment/clearance order under sections 80 and 83 of the Customs Act, 1969 and Rules 438 and 442 of Sub-Chapter III of Chapter. XXI of the Customs Rules, 2001 by the authority defined in Section 2 ibid for subsequent proceeding connected therewith, in derogation of provision of Section 193 ibid.?
(iii) Whether respondent No, 1 has been appointed as an Officer of Inland Revenue under Section 30A of the Sales Tax Act, 1990 and Section 230 of the Income Tax Ordinance, 2001 to be read with Notification No, S.R.O. 776(1)/2011 dated 19.08.2011 and Section 207 of the Income Tax Ordinance, 2001?
(iv) Whether respondent No, 3 has been appointed as an Officer of Inland Revenue under Section 30 of the Sales Tax Act, 1990 and Section 207 of the Income Tax Ordinance, 2001 and whether can exercise powers under the provision of Sections 11 and 162(1) of the Income Tax Ordinance, 2001?
(v) Whether subordinate of respondent No, 2 was/is empowered to pass re-assessment order under Section 80(3) of the Customs Act, 1969 and respondent No, 3 to issue show cause notice under Section 180 for piling simultaneously 02 orders of Section 179 of the Customs Act, 1969 on the existing appealable order passed by the authority defined in Section 2(a) under section 80 of the Customs Act, 1969 in derogation of the Article 13 of the Constitution of Islamic Republic of Pakistan and the law laid down by the Superior Judicial Fora?
(vi) Whether order-in-original was passed within the period of 120 days given in subsection (3) of section 179 of the Customs Act, 1969?
(vii) What is true intention of the legislature in framing and inserting Serial No, 15 in Table 1 and Note 1 in Sixth Schedule to the Sales Tax Act, 1990 and what does the word "but and "excluding" meant grammatically in plain language and whether exemption of Sales Tax is allowed to the appellants on their past and future consignments of imported canned/bottled fruits?
(viii) Whether Messrs Al-Naseeb Traders, (Clearing Agent) acted contrary to defined duties in the respective provisions of the .Act and Chapter VIII of Customs Rules, 2001?
(ix) Whether re-assessm ent passed by the official of 2 and order of respondent No, 3 can be termed as speaking order in terms of Section 24-A of the General Clauses Act, 1897?
8. That as regard to issue No, (i), the legislature has inserted Section 3DD in the Customs Act, 1969 through which Directorate of Post Clearance Audit has been created and its officials had been delegated powers through Notification No, 500(I)/2009 dated 13.06.2009 for conducting audit of the importer under Section 26A of the Customs Act, 199 which includes every aspects of the declaration made by the importer and assessment order passed by the competent authority of the Clearance Collectorate under Section 80 of the Customs Act, 1969 and Rule 438 of Sub-Chapter III of Chapter XXI of the Customs Rules, 2001 and upon finding discrepancy or any ambiguity in the declaration or the contravention of the law, audit observation is prepared and forwarded to the importer for clarification and if the reply fails to settle the issue, frames contravention report and forward to the Clearance Collectorate, which onward forward to the respective Collectorate of Customs, Adjudication for issuance of show cause notice under section 180 of the Customs Act, 1969 and passing of order-in-original as per the expression of Section 179 ibid. The officials of respondents Nos. 1 and 2 assumed the powers of officials of Directorate General of Post Clearance Audit and conducted the Audit Post Clearance of the Goods Declaration of the appellant under Section 26A in the absence of availability of powers. Neither officials of respondent No, 1 nor respondent No, 2 are empowered to transgress the sovereign jurisdiction of DG, PCA under any circumstances as this will render the formation of DG-PCA by the legislature under Section 3DD of the Customs Act, 1969 and the powers delegated under Notification No, 500(1)/2009 dated 13.06.2009 as redundant. The Tribunal has observed with great concern that the respondents Nos. 1 and 2 are running parallel departments to the DG, PCA in derogation of Section 3DD ibid, this is not permitted under law as the said act shall be instrumental in creating a situation of anarchy within the different organs of FBR, who will left no stone unturned for exceeding their jurisdiction while encroaching the powers/jurisdiction of the other sovereign organ of the FBR. These type of act cannot be allowed to be perpetuated under any circumstances instead have to thwart from the very beginning for sustaining the integrity and independence of the different sovereign organs of FBR. Therefore, the re-assessm ent dated 23.03.2013 made by the officials of respondent No, 2 of the Goods Declaration of the appellant after clearance and preparation of contravention report dated 18.03.2013 by the officials of respondent No, 1 without any lawful authority as such without any power/jurisdiction, hence, void and ab-initio and coram non judice as held in the relied upon judgments on the said point of law by the appellant consultant/advocate in para 3 (iii) supra. The issue No (i) is answered in negative.
9. That as regard issue No, (ii), the respondent No, 1 drive powers for functioning within the territory of Pakistan from Notification No, 486(I)/2007 dated 09.06.2007, for thwarting the act of smuggling and their jurisdiction is only restricted to the areas falling outside the purview of sections 9 and 10 of the Customs Act, 1969 and beyond 5 kilometers of the border of India and Iran as expressed in section 177 of the Customs Act, 1969 and Notification No, 188(I)/83 dated 12.12.1983. The case of the appellant is of consignment cleared by the official of respondent No, 2 after completion of all codal formalities from the port defined in section 9 ibid, therefore lawful and legal and stood ousted from the act of smuggling as defined in section 2(s) of the Customs Act, 1969 therefore least fall within the domain of the prescribed duties officials of respondent No,
1. The question arise that how and under which authority they assumed the powers. For arriving at a just decision, the contravention report is perused and so the Notification No, 486(1)/2007 dated 15.06.2007 and it transpired that the contravention report speaks about sections 32(1) & (2), 32A and 80 of the Customs Act, 1969, which are for "False statement, error etc.", "Fiscal fraud", "Declaration and Assessment for Home Consumption Warehousing", "Checking of goods declaration by the Customs". Powers invoked under Sections 32 and 32A have not been delegated to the respondent No,
1. Section 79 is a machinery Section and define the procedure for filing of Goods Declaration by the importers, Section 80 empowers a Customs Officer to complete Assessment Order for the imported goods, for levy of duty and taxes etc. Irrespective of the fact the officials of respondent No, 1 has no power under the said sections laid hand on the Goods Declaration for preparation of contravention, which had been lawfully released by the Competent Officer under the provision of Section 80 after passing of valid and legal Assessm ent Order. The official; of respondent No, 1 transgressed the power of the authority expressed in Sections 32, 32A and 80 of the Customs Act, 1969 and Notification No, S.R.O. 371(1)/2002 dated 15.06.2002, rendering the preparation of contravention report without power/jurisdiction being in derogation of Notification No, 486(I)/2007 dated 09.06.2007 and as such null, void ab-initio and corum non judice. The representative of respondent No, 1 has stated in negation of the provision of law and the notification that the respondent No, 1 is fully empowers to report any case of evasion of duty and taxes at import stage and are empowered to act for the contravention of sections 32 and 32A of the Customs Act, 1969 at import stage. The emphasis laid on the words "import stage" is worth considering, import stage mean at the time of clearance of the goods so imported not those which has been released/cleared under section 83 of the Customs Act, 1969 and Rule 442 of Sub-Chapter III of Chapter XXI of Customs Rules, 2001. The case of appellant least correspond to the "import stage" instead "post clearance", therefore the official of respondent No, 1 has no powers to lay hand on the said case of appellant, they transgressed the powers of the authority defined in sections 32, 32A and 80 of the Customs Act, 1969 and Notification No, 371(1)/2002 dated 15.06.2002, rendering the preparation of contravention report without power/ jurisdiction being in derogation of the referred section of the Act and Notification No, 486(1)/2007 dated 09.06.2007 and as such null and void, ab-initio and corum non judice. Upon passing of assessment order under section 80 of the Customs Act, 1969 and Rule 438 of Sub-Chapter (III) of Chapter XXI of the Customs Rules, 2001 and thereafter passing of clearance order under section 83 and Rule 442 ibid by the authority defined in section 2(a) of the Customs Act, 1969 and Notification No, 371(1)/2001 dated 15.06.2001, it cannot be disturbed by any authority including official of respondent No, 1 preparing contravention report and connecting proceedings therewith. The only course left for the subordinate of respondents Nos. 1 and 2 was to challenge the said orders before the Collector of Customs (Appeals) under section 193 of the Customs Act, 1969 which empowers the officer of respondent No, 1 and so the official of respondent No, 2 in terms of Notification No, 486(1)/2007 dated 09.06.2007 to file an appeal and in that they could incorporate all of their apprehensions, misreading of the facts and contravention of the provision of the Act/Rules. The Collector of Customs, upon receipt of the appeal and after going through the facts and grounds, if thinks fit that the contention of the respondents Nos. 1 B and 2 seems to be correct and the duty and taxes has not been either not levied or short paid on the basis of the goods assessed earlier for clearance, is empowered to issue show cause notice under section 32 ibid to the respondent (importer) as expressed in 2nd proviso to the subsection (3) of Section 193A of the Customs Act, 1969. Instead of the prescribed method the respondent No, 1 reopened the assessm ent/clearance order under section 195 of the Customs Act, 1969 under which powers are either vested with the Board or the Collector of Customs. Even otherwise, when the right of appeal has been accorded by the legislature in the provision of Section 193 of the Customs Act, 1969, the provision of Section 195 is un-operational and cannot be exercised C even by the authority defined therein and this has been validated by the Hon'ble High Court of Sindh in reported judgment 2014 PTD 1256 Messrs Paramount International (Pvt.) Ltd., Karachi v. Secretary Revenue Division that "department or an officer of customs, if aggrieved, by any decision or order passed by an officer of customs below the rank of additional collector could- prefer an appeal before the Collector (Appeal)--lst order in original passed in the subject matter was an appealable order for both the parties, therefore option to reopen and order pass under the adjudication hierarchy was not available to the Collector. Even the Collector of Customs Adjudication could not oversee or exercise any right of re-opening of any order which has been passed by an officer lower in rank but acting as an adjudicating authority. Impugned order was set-aside and Constitution Petition was allowed." In the instant case no appeal has been filed against the assessment order passed by the Appropriate Officer within the stipulated period of 30 days resultant, it attain finality and cannot be disturbed being a past and closed transaction. Therefore, the act and commission of respondents Nos. 1 and 3 is also in derogation of Sections 193 and 195 of the Customs Act, 1969 and as such of no legal effect, hence coram non judice. Therefore, I answer to issue No (ii) in negative.
10. As regard the issue No, (iii), upon perusal of amended Section 30A of the Sales Tax Act, 1990 by Finance Act, 2012 and insertion of Section 230 of the Income Tax Ordinance, 2001 by Finance Act, 2012, I found that the respondent No, 1 has not been appointed/ designated as officer of Inland Revenue by the legislature, instead Directorate General of Intelligence and Investigation- Inland Revenue which has been delegated powers under Notification No, 776(1)/2011 dated 19.08.2011 for exercising under different section of the Sales Tax Act, 1990 referred in column 3 of the notification and under section 207 of the Income Tax Ordinance, 2001 and for overseeing the collection of withholding Tax, Directorate General of withholding Taxes has been established under Section 230A of the Income Tax Ordinance, 2001, meaning thereby that the respondent No, 1 is not at all D appointed/designated as officer of Inland Revenue. Rendering the entire act of preparation of contravention report in the matter relating to sales tax and income tax by the official of respondent No, 1 without powers/jurisdiction and as such corum non judice and this stood validated from the latest reported judgment 2014 PTD 1733 Waseem Ahmed and others v. FOP and another, where it has been held in clear terms that "unless the officer of DGI&I)-FBR are not appointed as an officer of Inland Revenue, powers under the different sub section of the Sales Tax Act, 1990 can not be delegated through any SRO with that the Hon'ble High Court of Sindh declared that the act and commission taken by the respondent No, 1 in the presence of existing section 30A of the Sales Tax Act, 1990 and Notification No, S.R.O. 776(1)12011 the act and commission done by the respondent No, 1 in the matter of Sales Tax beyond the date of substitution of Section 30A and date of notification is without any lawful authority". The issue No'. (iii) is answered in negative.
11. That as regard issue No, (iv), upon perusal of show cause notice, it has been noticed that the respondent No, 3 has invoked Sections 3, 6 and 7A of the Sales Tax Act, 1990 and Section 148 of the Income Tax Ordinance, 2001. The Consultant Advocate of the appellant has strongly contended that he has not been appointed as officer of Inland Revenue under Section 30 of the Sales Tax Act, 1990 and Section 207 of the Income Tax Ordinance, 2001 therefore has no powers to proceed in the matter of Sales Tax and Income Tax under the sections invoked in the show cause notice for short paid taxes. On the other hand the respondents Nos. 1 and 2 are of the opinion that the customs is empowered to collect the Sales Tax and Income Tax at import stage under section 6 of the Sales Tax Act, 1990 and Section 148 of the Income Tax Ordinance, 2001 and can also recover the Taxes under the provision of Section 202 of the Customs Act, 1969. For determination of the jurisdiction, it is beneficial to reproduce verbatim of the relevant provisions of the Sales Tax Act, 1990 and Income Tax Ordinance, 2001 here-in-below: -- Section 30 Appointment of authorities---(1)
For the purposes of this Act, the Board may, appoint in relation to any person in respect of any area, person, class of persons to be :-
(a) A Chief Commissioner/Commissioner Inland Revenue.
(b) A Commissioner Inland Revenue
(c) A Commissioner Inland Revenue (Appeals)
(d) An Additional Commissioner Inland Revenue
(e) A Deputy Commissioner Inland Revenue (0 An Assistant Commissioner Inland Revenue
(g) An Inland Revenue Officer
(h) A Superintendent Inland Revenue
(i) An Inland Revenue Audit Officer
(j) An Inspectors Inland Revenue; and
(k) An Officer of Inland Revenue with any other designation.
(2) The Chief Commissioner, Inland Revenue and Commissioner Inland Revenue (Appeals) shall be subordinate to the Board and Commissioner Inland Revenue shall be subordinate to the Chief Commissioner Inland Revenue.
(3) Additional Commissioner Inland Revenue, Deputy Commissioner Inland Revenue, Assistant Commissioner Inland Revenue, Inland Revenue Officers, Superintendent Inland Revenue, Inland.
Revenue Audit Officers Inland Revenue Officer, [Inspectors Inland Revenue and Officers of Inland Revenue with any other designation shall be subordinate to the Commissioner Inland Revenue and shall performs their functions in respect of such persons or clauses of persons or such areas as the Commissioners, to whom they are subordinate, may direct.
(4) Deputy Commissioner Inland Revenue, Assistant Commissioner Inland Revenue, Inland Revenue Officers, Superintendent Inland Revenue, Audit Officers Inland Revenue, [Inspectors Inland Revenue] and Officers of Inland Revenue with any other designation shall be subordinate to the Additional Commissioner [Inland Revenue] Section 6. Time and manner of payment:---(1) The tax in respect of goods imported into Pakistan shall be charged and paid in the same manner and at the same time as if it were a duty of customs payable under the Customs Act, 1969 (and the provisions of the said Act (including section 31A thereof) shall so far as they relate to collection, payment and enforcement of tax under this Act on such goods where no specific provisions exist in the Act apply!"
"Section 11: Assessm ent of Tax and Recovery of Tax not levied or short levied or erroneously refunded:---(1) Where a person who required to file a tax return fails to file the return for a tax period by the due date or pays amount which for some miscalculation is less than the amount of tax actual payable, an officer of Inland Revenue shall after a notice to show cause to such person, make an order for assessm ent of tax, including imposition of penalty and default surcharge in accordance with sections 33 and 34.
Provided: that, where a person required to file a tax return filed the return after the due date and pays the amount of tax payable in accordance with the tax return along with default surcharge, a notice to show cause and the order of assessment shall abate.
(2) Where, a person has not paid the tax due on supplies made by him or has made short payment or has claimed input tax credit or refund which is not admissible under this Act for reasons other than those specified in subsection (1), an officer of Inland Revenue shall after a notice to show cause to such person, make an order for assessment of tax actually payable by that person or determined the amount of tax credit or tax refund which he has unlawfully claimed and shall imposed a penalty and charged default surcharge in accordance with Sections 33 and 34.
(3) Where by reason of some collusion or a deliberate act any tax or charge has not been levied or made or has been short levied or has been erroneously refunded the person liable to pay any amount of tax or charge or the amount of refund erroneously made shall be served a notice requiring him to show cause for payment of the amount specified in the notice.
(4) Where, by reason of any advertence, error or misconception, any tax or charge has not been levied or made or has been short levied or has been erroneously refunded the person liable to pay amount of tax or charge or the amount of refund erroneously made shall be served with a notice requiring him to show cause for payment ,of the amount specified in the notice. Provided that, where a tax or charge has not been levied under this subsection, the amount of tax shall be recovered as tax fraction of the value of supply;
(5) No order under this section shall be made by an officer of Inland Revenue unless a notice to show cause is given within five years of the relevant date, to the person in default specifying the grounds on which it is intended to proceed against him the officer of Sales tax shall take into consideration the representation made by such person and provide him with an opportunity of being heard.
Provided the order under this section shall be made within one hundred and twenty days of issuance of show cause notice or within such extended period as the Commissioner may for reasons to be recorded in writing fix provided that such extended period shall in no case exceed ninety days.
Provided further that any period during which the proceedings are adjourned on account of a stay order or Alternative Dispute Resolution proceedings or the time taken through adjournment by the petitioner not exceeding sixty days shall be excluded from the computation of the period specified in the first proviso.
(6) Notwithstanding anything contained in subsection (1), where a registered person fails to file a return, an officer of Inland Revenue not below the rank of Assistant Commissioner, shall subject to such conditions as specified by the Federal Board of Revenue, determine the minimum tax liability of the registered person.
(7) For the purpose of this section, the expression "relevant date" means:-
(a) the time of payment of tax or charge as provided under section 6, and
(b) in a case where tax or charge has been erroneously refunded, the date of its refund!
Section 48. Recovery of arrears of Sales Tax- [ subject to subsection (A) where any amount of tax is due from any person the officer of sales tax may-
(a) Deduct the amount from any money owing to person from whom such amount is recoverable and which may be at the disposal or in the control of such officer or any officer of Income Tax, Customs or Central Excise Department: [207 Income Tax authorities (1) These shall be the following Income tax authorities for the purposes of this Ordinance and Rules made there-under, namely
(a) Board
(b) Chief Commissioner Inland Revenue.
(c) Commissioner Inland Revenue
(d) Commissioner Inland Revenue (Appeals)
(e) Additional Commissioner Inland Revenue
(f) Deputy Commissioner Inland Revenue
(g) Assistant Commissioner Inland Revenue
(h) Inland Revenue Officer
(i) Inland Revenue Audit Officer
(j) Superintendent Inland Revenue
(k) Inspectors Inland Revenue; and
(l) Auditor Inland Revenue
(m) Officer of Inland Revenue with any other designation.
(2) the Board shall examine, supervise and oversee the general administration of this Ordinance.
(3) Income Tax Ordinance Tax authorities specified in subsection (1) except in clause (a) shall be subordinate to the Board] [(3A) Commissioner Inland Revenue, Additional Commissioners Inland Revenue, Deputy Commissioners Inland Revenue, Assistant Commissioners Inland Revenue, Inland Revenue Officers, Inland Revenue Audit Officers, Superintendents Inland Revenue, Auditors Inland Revenue Audit, Inspectors Inland Revenue shall be subordinate to the Chief Commissioners Inland Revenue]
(4) Subject to Sub section (5) Additional Commissioner Inland Revenue, Deputy Commissioner Inland Revenue Assistant Commissioner Inland Revenue, Inland Revenue Audit Officers, Superintendent Inland Revenue, Auditor Inland Revenue and Inspectors Inland Revenue shall be subordinate to the Commissioner Inland Revenue.
(4A) Deputy Commissioners Inland Revenue, Assistant Commissioners Inland Revenue, Inland Revenue Audit Officers Inland Revenue Superintendents Inland Revenue, Auditors Inland Revenue and Inspectors Inland Revenue shall be subordinate to the Additional Commissioner Inland Revenue]
(5) An officer vested with the powers and function of Commissioner shall be subordinate to the Chief Commissioner Inland Revenue.
Section 148 of the Income Tax Ordinance 2001:---Imports (1) The Collector of Customs shall collect advance tax from every importer of goods on the value of the goods at the rate specified in Part II of the First Schedule.
(2) Nothing contained in subsection (1) shall apply to any goods or class of goods or persons or class of persons importing such goods or class of goods as may be specified by the Board.
(5) Advance tax shall be collected in the same manner and at the same time as the customs duty payable in respect of the import or, if the goods are exempt from customs duty, at the time customs duty would be payable if the goods were dutiable.
(6) The provisions of the Customs Act, 1969 (IV of 1969), in so far as relevant, shall apply to the collection of tax under the section.
(7) The tax collected under this section shall be final tax on the income of the importer arising from the importer subject to sub section (1) and this sub section shall not apply in the case of import of:- -
(a) raw material, plant, machinery, equipment and parts by an industrial undertaking for its own use;
(b) fertilizer by manufacturer of fertilizer and
(c) (motor vehicles in CBU condition by manufacturer of (motor vehicles)
(d) Large import houses, who?
(i) Have paid-up capital of exceeding Rs, (250) millions
(ii) Have imports exceeding Rs, 500 million during the tax year;
(iii) Own total assets exceeding Rs, (350) millions at the close of the tax year.
(iv) Is single object company
(v) Maintain computerized records of imports and sale of goods;
(vi) Maintain a system for issuance of 100% cash receipts on sales.
(vii) Present accounts for tax audit every year
(viii) Is registered with Sales Tax Department; and
(ix) Make sales of industrial raw material of manufacturer registered for sales tax purposes)
(8) the tax collected from a person under this section on the import of edible oil {and packing material for a tax year shall be (minimum tax)
(9) In this section- "Collector of Customs" means the person appointed as Collector of Customs under section 3 of the Customs Act, 1969 (IV of 1969), and includes a Deputy Collector of Customs in Additional Collector of Customs or an officer of customs appointed as such under the aforesaid section; [Value of goods" means the value of the goods as determined under the Customs Act, 1969 (IV of 1969), as if the goods were subject to ad valorem duty increased by the customs duty federal excise duty and sales tax, if any payable in respect of the import of the goods.
Section 162. Recovery of tax from the person from whom tax was no collected or deducted---(1)
Where a person fails to collect tax as required under Division II of this Part {or Chapter XIII or deduct tax from a payment as required under Division III of this Part [or Chapter XII], the Commissioner may {pass an order to that effect and) recover the amount was not collected or deducted from the person from whom the tax should have been collected or to whom the payment was made.
(2) The recovery of tax under subsection (1) does not absolve the person who failed to deduct tax as required under Division Ill of this Part [or Chapter XII] from any other legal action in relation to the failure, or from a charge of additional tax or the disallowance of a deduction for the expense to which the failure relates, as provided for under this Ordinance.( Emphasis is ours)
Section 140. Recovery of tax from person holding money on behalf of a tax payer:---(1) For the purpose of recovering any tax due by a taxpayer, the Commissioner may, by notice, in writing, require any person
(a) Owing or who may owe money to the taxpayer or
(b) Holding or who may hold money for, or on account of the tax payer
(c) Holding or who may hold money on account of some other person for payment to the taxpayer, or
(d) Having authority of some other person to pay money to the taxpayer To pay to the Commissioner so much of the money as set out in the notice by the date set out in the notice.
From conscientious study of Section 30 of Sales Tax Act, 1990 and Sections 228 to 230A of the Income Tax Ordinance, 2001, it is observed that the legislature appoints under the said sections different officers of the FBR as Officer of Inland Revenue for exercising powers under the respective Sections of the Sales Tax Act, 1990 delegated separately through statutory notifications of Income Ordinance in accordance with Section 207 of the Income Tax Ordinance, 2001. In these Sections respondent No, 3 figures nowhere confirming that he is not empowered to exercise powers under section 11 of the Sales Tax Act, 1990 and Section 162(1) of the Income Tax Ordinance, 2001.
To further elaborate and settling the issue to its logical conclusion, I add while referring to Section 6 of the Sales Tax Act, 1990 and 148 of the Income Tax Ordinance, 2001 through which the respondent Collectorate is empowered to collect the Taxes on the imported goods as like custom duty on the value determined under Section 25 of the Customs Act, 1969. The said Sections least empowers the Officers of Customs including the respondents to initiat( adjudication/recovery proceeding for the short collected/paid Sales Tax and Income Tax either due to collusion or connivance or inadvertence, error or misconstruction. For proceeding for these type of recovery a show cause notice has to be issued under the Provision of Section 11 of the Sales Tax Act, 1990 and Section 162(1) of the Income Tax- Ordinance, 2001, the authority to issue show cause notice under Section 11 of the Sales Tax Act, 1990 and Section 162(1) of the Income Tax Ordinance, 2001 are Officer of Inland Revenue and the Commissioner of Income Tax. The respondent No, 3 assumed the powers not vested with him. Meaning thereby the Customs Collectorate have powers to collect sales tax and income tax as duty at import stage not post importation, as regards to the plea that customs is empowered to recover the short paid amount post clearance under section 202 of the Customs Act, 1969 is based on mistaken belief, infact the Customs Collectorate could recover the amount from the amount lying with it of the importer upon receipt of notice from the Officer of Inland Revenue and Commissioner of Income Tax under Section 48 of Sales Tax Act, 1990 and Section 140 of the Income Tax Ordinance for recovery of the adjudged amount of taxes by the competent officer of LTU/RTO after / due process of law.
On the strength of above deliberation, it is my considered opinion that the Customs Collectorates does have the authority to collect Sales Tax and Income Tax at import stage in the capacity of collecting agent and can recover escaped/short payment paid Custom Duty and Regulatory Duty levied on the imported goods under Section 18 of the H Customs Act, 1969 under Section 202 of the Customs Act, 1969 after due process of law, but have no powers to adjudicate the cases of short recovery of Sales Tax and Income Tax under sections 11 and 162(1) ibid of the Act/Ordinance respectively. Neither respondent No, 1 nor respondent No, 3 have the powers to recover the arrears of these Taxes at their own, unless they are in receipt of notice from the Officer of Inland Revenue and Commissioner of Income Tax under section, Sections 48 and 140 ibid. Resultant adjudication proceeding under section 11 of the Sales Tax, 1990 and Section 148 of the Income Tax Ordinance, 2001 (as mentioned in the Show Cause notice) is not legal, justifiable and tenable in the eyes of the law and inconsonance with the reported judgment 2011 PTD (Trib.) 2086, 2011 PTD (Trib.) 110 Messrs AGP (Pvt.) Ltd., v. Additional Collector of Customs, Karachi, Order-in-Customs Appeal No, K-903/2011 Messrs Moon Enterprises v. Collector of Customs MCC (PaCCS) and others, K-236 - 270/2012 Messrs Fort Tiles v. Additional Collector of Customs, MCC of PaCCS and another and reported judgment 2014 PTD (Trib.) 299, Messrs K460/2012 of Messrs M.I. Traders, Lahore v. Additional Collector, MCC of PMBQ, Karachi and by Hon'ble High Court of Islamabad in Customs Reference No 01/2010 Collector of Customs, Rawalpindi v. Global Marketing and Services etc., wherein order of the Tribunal in Customs Appeal No 187/CU/IB/2008 dated 31.07.2009 on the said issue was maintained, similarly in recent judgment announced by the Hon'ble High Court of Sindh in Petition C.P. No,D-216/2013 of Messrs Lucky Cement Ltd. Karachi v. Federation of Pakistan and others it has been held:-- "The word emphasized could be regarded as being in the nature of deeming provisions. If so, then (subject to the rules of interpretation that apply in such a situation) that nature of sales tax or excise duty on imports, for purpose of levy, charge or collection (as the case may be), may be regarded as a customs duty. Clearly, this would be a materially different situation than that which obtains in relation to advance income tax on imports. In our view, the jurisdiction of the customs authorities (i,e, the Collector of Customs) is limited to only the collection of the advance income tax. Furthermore, subsection (6) of section 148 emphasizes that provisions of the Customs Act apply only to the Collection of the tax and that too, only in so far as is relevant. Since there is a clear distinction between the collection of a tax on the one hand and its recovery or enforcement on the other, in our view, the provision of the Customs Act as relate to the latter are not applicable in relation to the jurisdiction conferred on the Customs Authorities under section 148."
Whereas in reported judgment 2014 PTD 1963 Shujabad Agro Industry (Pvt.) Ltd., v. Collector of Customs and 8 others, the Hon'ble High Court of Sindh held that:-- "the customs authorities has no powers under law to restrict release of 'duty paid consignment' on the plea that imported goods were liable to be assessed at the rate of 5% of 'advance tax'
[prescribed for one's own manufacturing used] and not at reduced rate of 3% of 'advance tax'
[prescribed for industrial used]. Such act of custom authority was without jurisdiction and lawful authority. Custom authorities under law were merely collection agent on behalf of Inland Revenue Department for collection of 'advance tax'. Denying refusal of the consignment on the pretext that income tax is payable @ 5% as against 3% on the basis of reduced rate certificate issued by the Commissioner of Inland Revenue is not only arbitrary, mala-fide but also without any jurisdiction, hence illegal, void and ab-initio".
The opinion formed further, stood validated in addition to the above referred judgments from the judgments of 1994 CLC 1612, 1990 PTD 29, 2005 PTD 23, 2007 PTD 250 titled as Collector of Sales Tax and Federal Excise v. Messrs Qasim International Container Terminal Pakistan Ltd., it was held that:- - "There is a clear distinction between the charging provision of Statute and the machinery part thereof. It is axiomatic that mode of manner of recovery does not alter, the nature of tax nor a tax can be introduced or import by implication."
It has been held in another judgment of Hon'ble Lahore High Court, Lahore PTCL 2009 CL 75 titled as Xen Shahpur Division v. Collector of Sales Tax (Appeal), Collectorate of Customs, Federal Excise and Sales Tax, Faisalabad, -- "That fiscal law is to be applied with full authority and its natural meaning---one has to look merely at what is clearly said and there is no room for any intendment---neither there is equity about a tax nor presumptions as to tax---nothing is to be read in, nothing is to be implied---one can only look fairly at the language used"
The Hon'ble Supreme Court of Pakistan in reported judgment PTCL 2008 CL 337 titled as DGI&I and others v. Al-Fait Industries (Pvt.) Ltd., and others held that:- "If the law have prescribed method for doing a thing in a particular manner such provision of law is to be followed in letter and spirit and achieving or retaining the objective of performing or doing of a thing in a manner other than provided by law would not be permitted---each and every words appearing in a section is to be given effect and no other word is to be rendered as redundant or surplus - when the legislature required the doing of a thing in a particular manner then it is to be done in that manner and all other manner or modes of doing or performing that things are barred- --if the doing of a thing is made lawful in a particular manner the doing of that thing in conflict with the manner prescribed will be unlawful as per maxim "Expression facit cessare taciturn"
I, therefore hold that the exercise of jurisdiction on this point by the respondent No, 3 is ab-initio void and as such coram non-judice and answer the issue No, (iv) in negative.
12. That as regard to issue No, (v ), it is observed that the consignments corresponding to the instant appeal had been undergone the procedure of assessment/clearance order under the provision of Section 80 and 83 of the Customs Act, 1969 and Rules 438 and 442 of Customs Rules, 2001 by the authority define in section 2(a) of the Customs Act, 1969 in exercise of the powers conferred upon by the Board through Notification No, 371(1)/2002. This order is an appealable order and can be assailed either by the importer or the officer of customs under the provision of section 193 of the Customs Act, 1969 within 30 days of the order. In these cases it was upon the officials of respondents Nos. 1 and 2 to file an appeal, which was infact not filed to this date, resultant, attain finality through limitation and cannot be disturbed by any authority as held in reported judgment 1989 MLD 4310 Messrs World Trade Corporation v. Central Board of Revenue, wherein their lordship of High Court held that "if the order" has attained finality through limitation. A fortiori; the Central Board of Revenue could not open up an order that has attained finality, under the Sea Customs Act, 1878 and against which sou motu revision lay under the Act. Inspite of the law laid down, the subordinate of respondent No, 2 passed reassessment orders dated 23.03.2013 under Section 80(3) of the Customs Act, 1969. Which were assailed by the appellant before the Collector of Customs Appeal under the provision of Section 193 of the Customs Act, 1969 on 12.04.2013 vide Nos. 4327/2013 to 4632-A/2013 PaCCS and the matter stood sub judice. In the presence of these vital facts on record the respondent No, 3 opted to issued show cause notice dated 25.06.2013 which was not warranted under law as the allegation contained therein, were very much the basis for passing re-assessment order by the subordinate of respondent No,
2. In these circumstances the respondent No, 3 was not empowered to start adjudication proceeding through issuance of show cause notice under section 180, while exercising power under the provision of Section 179 ibid., because their act is tantamount to piling upon yet other order on the existing order, this is not permitted under law as held in Hon'ble High Court of Sindh in reported judgment 2004 PTD 3020 Messrs Smith Kline French v. Pakistan that "once an order is passed, which attain finality the same cannot be subject to a show cause notice again, considering that no appeal or revision is filed against the first order". By virtue of non filing appeal by the subordinate of respondents Nos. 1 and 2 against the 1st assessment order, within the stipulated period the transaction stood past and closed and attain finality and cannot be disturbed through any subsequent reassessm ent orders or order-in-original as this is not permitted under law as it is also an act of "double jeopardy" barred under Article 13 of the Constitution of Islamic Republic of Pakistan. I therefore hold that the reassessment order dated 23.03.2013 and Orderin-Original dated 17.12.2013 passed by respondents Nos. 2 and 3 are not only arbitrary, illegal but mala fide and without any lawful authority hence void and ab-initio by virtue of being in derogation of the law laid down by the Superior Judicial Fora and Article 13 of the Constitution of Islamic Republic of Pakistan. The issue No, (v) is answered in negative.
13. That as regards to issue No, (vi), The show cause notice to the appellant was issued on 25.06.2013 and an order under the proviso of subsection (3) of Section 179 of the Customs Act, 1969 should had been passed by the respondent No, 3 within 120 days i,e, on or before 23.10.2013 from the date of issuance of show cause notice or within a further extended period of 60 days by the Collector of customs prior to lapse of initial period of 120 days after serving notice to the person concerned and thereafter recording reasons for the extension based on exceptional circumstances in writing as held by Hon'ble Supreme Court of Pakistan in reported judgment 1993 SCMR 1881 Khalid Mahmood v. Collector of Customs. In the instant case the order has been passed on 11.12.2013 without any extension and this stood confirmed from the operative part of the order.
Therefore, the order so passed is barred by 50 days, hence without powers/jurisdiction and cannot be enforced under law as held in reported judgments 2008 PTD 60, 2008 PTD 578, 2009 PTD 762, 2009 PTD (Trib.) 1263, 2009 PTD 1978, 2010 PTD (Trib.) 1010, 2011 PTD (Trib.) 79, 2011 PTD (Trib) 987, 2011 PTD 1146, 2012 PTD (Trib.) 1650. That issue No,(vi) is answered in negative.
14. That as regard issue No, (vii), it is beneficial to reproduced Serial No, 15 of Table 1 and Note 1 of the Tables to the Sixth Schedule, which are:-- Sr.
No.Description Heading Nos. of the first schedule to Customs Act,1969 15 Edible fruits excluding Imported Fruits (except fruits imported from Afghanistan) whether fresh, frozen or otherwise preserved but excluding those bottled "[or) canned [***]0803.000, 0804.1010, 0804.1020, 0804.2000, 0804.3000, 0804.4000, 0804.5010, 0804.5020, 0804.5030, 0805,1000, 0805.4000, 0805.2090, 080.4000, 0805.5000, 0805.9000, 0806,1000, 0806. 2000, 0807.1100, 0807. 1900, 0807.2000, 0808. 1000, 29(0808.3000, 0808. 4000), 0809.1000, 0809. 2000, 0809.3000, 0809.
4000, 0810.1000, 0810. 2000, 30(***)
0810. 4000, 0810.5000, 0810. 6000, 0810.9010, 0810. 9090, 0811.1000, 0811. 2000, 0811.9000, 0813. 1000, 0813.2000, 0813. 3000, 08133.4010, 0813. 4090."
Note 1 "For the purpose of this Schedule, for entries against which classification of headings or sub- headings has been specified, exemption shall be admissible on the basis of description of goods as mentioned in column (2) of the Schedule. PCT classification of headings is provided for ease of reference and commodity classification purpose only"
The appellant are of the view that their imported consignments of bottled or canned pineapples or fruits are exempted from payment of Sales Tax under Serial No, 15 of Table 1 to be read in conjunction with Note 1 to the Tables of the Sixth Schedule to the Sales Tax Act, 1990. Whereas respondents Nos. 1 and 2 are of the opinion that the exemption is not applicable on the imports of the appellant consignments under the said serial number and their opinion is based on the understanding that exemption is applicable only to the local supply and not imports with the exception of fruits imported from Afghanistan and this exemption is not available on local supply and Afghan Import if bottled or canned and in support of their stance, plea taken is that the importer with the exclusion of appellant are paying sales tax for clearance of their consignments, this plea is without any substance beside nullity to law, because if the exemption is available, the importer has to claim that at the time of filing Goods Declaration in the absence of that neither the system nor the assessing officer can extend that at their own despite entitlement this is no argument and no case can be framed on the basis of said misconceived understanding/opinion.
The fault rest on the part of the importer who never claimed the exemption despite available. As regard their opinion that the exemption is neither available to local sale and import under Table 1 to the Sixth Schedule, i,e, also contrary to the law. The Table 1 is for the import and supply and has to be read in conjunction with note 1, which stipulate that exemption shall be admissible on the basis of description of the goods as mentioned in column (2) of the Schedule. PCT classification of heading is provided for ease of .Reference and commodity classification purpose only meaning thereby that if any PCT is not incorporated in column (3) and the goods so imported answer the description of the goods as mentioned in column (2) of the Schedule exemption is available to those under the respective serial number of Table 1 of Sixth Schedule to the Sales Tax Act, 1990. The fact of matter is the respondents Nos. 1 and 2 are substituting the words " but" with "and" and "excluding" with "including" for achieving their objectives completely in nullity to law laid down in umpteenth reported judgments by the Superior Judicial fora that "tax statute are to be interpreted in light of what is clearly expressed. Nothing can be added or subtracted or implied, which is not expressed, it cannot import provision in the statute so as to support assumed deficiency. There is no room for intendment. There is no equity about a tax. There is no presumption as to tax nothing is to be read in, nothing is to be implied. One only look fairly at the language used nothing else to be done" as held reported judgments 1989 CLC 146 and 2011 PTD (Trib.) 79.
15. The Officials of Respondents Nos. 1 and 2 are of the view that while framing Serial No, 15, the intention of legislature was to disallow the exemption on the canned/bottled fruits imported from Afghanistan. The said interpretation is inept besides against the intention of the legislature because if it would had been like this, the legislature could have phrased and inserted Serial No, 15 of table 1 to the Sixth Schedule reading as "Edible fruits excluding imported fruit (except fruits imported from Afghanistan but excluding those bottled or canned) whether fresh, frozen or otherwise preserved". In fact they are challenging/disputing the wisdom of legislature, which is not permitted as the court has no concern with the wisdom of legislature whose Act is attacked, and it would be a dangerous precedent to allow the view of the Members of the Court as to the serious consequences of excessive taxation. The principle in interpretation of statutes is that the intention of the legislature to be ascertained by reference to the word used and the grammatical and ordinary sense of the word to be adhered to. Where the language of the statute is clear and unambiguous, it must be interpreted in its ordinary sense. The state of law at the time of statute was passed is a matter material to be considered to arrive at the intention of .The legislature. In negation the Official of Respondents Nos. 1 and 2 interpreting the Serial No,15 in accordance to their own objective while ignoring yet another principle of interpretation that one has to remain within the language of law and not to extend its meaning by way of interpretation.
16. The contentious words "but" and "excluding" available in the Serial No, 15 are to be evaluated in the light of their meaning. Since, no specific meanings of these words are available in any taxing Statute/ notification, ordinary grammatical meaning has to be adopted as it is elementary rule of construction that phrases and sentences of the statute should be construed according to the rules of grammar and the words of a statute should be interpreted in their plain grammatical sense.
These words are defined in different renowned dictionaries as follows:--
(i) But The Chambers Dictionary 1997 Edition: without; On the other hand; In contrast; Nevertheless; Unless; If not; Other than.
The Lexicon Webster Dictionary of English Language Encycloped Edition: Only; Merely; Yet; On the other hand; Without.
Merriam-Webster Dictionary: Except; Unless; On the contrary; On the other hand.
The Free Dictionary: On the contrary; If not; Unless; Than; An objection; In contrast; Except.
Wiktionary: Except; On the contrary; However.
(ii) Excluding The Chambers Dictionary 1997 Edition: To shut out; To push out; To eject; To prevent from entering; To omit; To prevent from taking part; to except or leave out; to Exempt (from a law or regulation).
The Lexicon Webster Dictionary of English Language Encycloped Edition: To keep out; Prevent or forbid the entry of; To leave out; To vent.
Merriam-Webster Dictionary: To prevent; To leave out; Restrict the entrance of, To bar from participation; consideration or inclusion; To expel or bar from a place or position previously occupied.
The Free Dictionary: To prevent from entering; Keep out; Bar; To prevent from being included; Considered or accepted; Reject; To put out and expel.
Wiktionary: To the exclusion of; Not including.
The appropriate definition available in the dictionaries and applicable to in the serial No, 15 to Table -1 to Sixth Schedule of the Sales Tax Act are "without" on the other hand "except", "however" and for the word "excluding", "to shut out", "to push out, to eject, to omit, leave out, to keep out, to prevent or forbid, to vent, restrict the entrance of, to bar from participation", consideration or inclusion, to expel, to prevent for being included, reject, to put out and not included", therefore as per plain and, grammatical meaning of these words, none of the dictionaries provide definition of the word "but" as "and" and "excluding" as "including", therefore the word used "but" and "excluding" are not to be read as "and" and "including." instead the word used "but" is for without or exception and the excluding preventing from entry, to omit, to leave out, to bar from participation etc., meaning thereby that the legislature only could have used the word but excluding canned or bottled fruits from Serial No, 15 but due to the fact that the said entry contain 2 exclusion for avoiding any confusion they had used the word "but" for laying emphasis for the second exclusion, otherwise there is no need for using the word "but" as the word "excluding" was enough for the second exclusion, therefore Serial No, 15 should had been interpreted as per its spirit and essence reflecting the intention of the legislature, which is as under:-- 1st Exclusion: Edible Fruits, except imported from Afghanistan irrespective of their condition and mode and manner of packing 2nd Exclusion: Edible Fruits, excluding imported fruits whether fresh, frozen or otherwise preserved but excluding those bottled or canned.
Through Serial No, 15 the legislature has denied exemption on the imported fruit whether fresh, frozen or preserved with the exception of bottled or canned i,e,, meaning thereby that imported canned or bottled fruits are exempt from the payment of sales tax without any ambiguity as the language is quite clear and so the definition, even otherwise if it is presumed for the sake of arguments that their exist anomaly or ambiguity in the Serial No, 15 as this leads to two or more interpretation, even then it has to be resolved in favour of the subject as held in the reported judgment 1993 SCMR 274, 2005 SCMR 728, 2007 PTD 1656 and 2008 PTD 1227 that "if there are two or more interpretation of a provision pertaining to levy of tax on account of anomaly/ambiguity the one favourable to the tax payer has to be adopted by the court". It is also my considered opinion which has been arrived after going through umpteenth reported judgment of Superior Judicial Fora that "tax payer should not be made to suffer on account of bad drafting of the statute." Reference is placed to the reported judgment 2004 PTD 901 Hashwani Hotel Ltd., v. FOP, wherein, their lordship of High Court held that:-- "While interpreting the taxing statute the Court must look to the word of statute and interpret it in the light of what is clearly expressed. It cannot imply anything which is not expressed. It cannot import provision in the statute as to support assumed deficiency."
"While finding out intention of the legislature language of the law is not be seen and if the intention is cleared from the language used nothing else is to be done." "if the legislature has not sufficiently expressed itself Court has no duty to act for it, for court is concerned with what it lays down and not what it has only in mind, but once it has been articulated enough Court does not more than give effect to the intention that it has succeeded in expressing.
The intention may be expressed in faulty language, in very faulty language, in-extremely faulty language, this is of no consequence as long as there is no doubt as to the intention. A draftsman mistake as long as it relates to form in which the legislative intend is expressed and not to the substance of it, is of no effect. Of course ones an element of doubt as to the intention of the legislature enter the field consideration otherwise irrelevant may all become relevant."
Notwithstanding, with the legal plane as deliberated above, the contention of the respondents Nos.
1 and 2 further stood negated from the press release of 19 June, 2013 available in the Portal of FATE of FBR with the caption " FBR direct field offices to monitor that no sales tax is collected on exempted items" and in the said press release fruit is included irrespective of their conditions and mode of packing. As regard their contention that Board has confirmed through letter dated 31.03.2013 that no exemption is available on the bottled and canned fruits under Serial No, 15 i,e, also without any substance as Board is non entity to interpreate statute. Interpretation of the statute solely fall within the domain of High/Supreme Court, the FBR even cannot alter or amend an entry of the statute. The provision of the act/statute can only be amended by the legislature by way of budgetary measures through money bill i,e, through Finance Act. The legislature has not to this date endorsed the opinion of the respondents Nos. 1 and 2 and FBR through money bill despite passing of money bills for the years 2013-14 and 2014-15 and the serial No, 15 stand as it was framed/inserted in the Sixth Schedule to the Sales Tax Act by the legislature. I therefore hold that the appellant correctly claims the exemption for their imported canned/bottled fruit under Serial No, 15 of Table 1 and Note 1 to the Tables of the Sixth Schedule to the Sales Tax Act, 1990 and the appropriate assessing officer correctly allowed those while endorsing their opinion in assessment notes that DV is at par with VR assessed on DV. Importer claimed Serial 61 of the Schedule VI, for Sales Tax exemption, this serial is meant for exemption of ST on re-import of Pakistani origin goods qualifying conditions laid down under Section 22 of the Customs Act, 1969. Hence the same has been deleted. This deletion is also supported by the 90 days data of the identical previous import wherein 95% cases the benefit has not been extended" and "Goods are covered by the description given in SR.15 of Schedule VI whereas Corresponding PCT Headings have not been given. The PCT Headings are just for reference purpose and the benefit if any is allowed to the described products.
In view of the situation SR.61 is used. GD assessed accordingly with benefit of Schedule VI is admissible. On the basis of the deliberation, I hold that the exemption to the appellant on their future imported consignment of canned and bottled fruits shall also be available as this is in accordance with the essence and spirit of Serial No, 15 of Table 1 and Note 1 to the Tables of the Sixth Schedule to the Sales Tax Act, 1990. With this I answer the issue No, (vii) in affirmative.
16. As regard to issue No, (vii), Messrs Al-Naseeb Traders, Karachi filed online Goods Declaration on the strength of the import documents supplied to it by Messrs General Food Corporation, Karachi and the assessing officer passed the assessment order under Section 80 of the Customs Act, 1969 and Rule 438 of Sub-Chapter III of Chapter XXI of the Customs Rules 2001 after transmitting view message under Rule 437 for scanning of invoice, packing list and B/L and the scanned documents formed the integral part of the declaration made under section 79(1) and Rule 433 ibid., as defined in Section 2(kka) ibid, which read as follows:- [2{kka} "documents means a goods declaration, application for claim of refund, duty drawback or repayment of duty, import or export general manifest passenger manifest, bill of lading, airway bill, commercial invoice and packing list or similar other forms or documents used for customs clearance or making a declaration to customs, whether or not signed or initialed or otherwise authenticated, and also includes:-
1. Any form of writing on material, data or information recorded, transmitted, or stored by means of a tape recorder, computer or any other device, and material subsequently derived from information so recorded, transmitted or stored;
2. a label, marking or other form of writing that identifies anything of which it forms part or to which it is attached by any means;
3. a book, map, plan, graph or drawing, and
4. a photograph, film, negative, tape or other device in which one or more visual images are embodied so as to be capable (with or without the aid of some other equipment of being reproduced; and)] Messrs Al-Naseeb Traders, Karachi in the capacity of Clearing Agent has no part to play in the said transaction as it is between the importer (appellant No, 1) and the respondent No,
2. He only provided services to him on very nominal charges and assistance to the officials of respondent No, 2 in conducting examination under section 198 of the Customs Act, 1969., On the basis of which the official of respondent No, 2 pass the assessment/clearance order under sections 80 and 83 of the Customs Act, 1969. From the record, it is apparent that he carried out his duties correctly as prescribed in the Act and Chapter VIII of Customs Rules, 2001. It is for the Official of Respondent No, 2 to assess the goods for levy of duty and taxes under section 80 and Rule 438 ibid, which include correctness of the particular of the imports including declaration, importability of the goods in question falls within the ambit of declaration/assessment and clearing agent is non entity in the said section. The Appellate Tribunal in umpteenth judgments wherein the facts were similar held that "provisions of section 209 of the Customs Act, 1969 provide immunity and limited liability against the agent and an agent cannot be charged for misdeclaration under section 32 of the Customs Act, 1969 if he filed documents under the provisions of Customs Act, 1969 in accordance with the import/export documents and further held that the action taken by the customs of charging agent and thereafter leveling penalty without any fault or default on his part is not only unfair but also illegal. Whereas in reported judgment 2002 YLR 2651 Messrs Ports Ways Custom House Agent and another's v. Collector of Customs and another's held. "The imposition of penalty on the Clearing Agent/appellant No,1 was all the more unjustified. To hold the clearing agent liable for the act of commissions and omissions on the part of the importer will require a clear finding based upon legally acceptable evidence of his being an active and conscious party to the manipulation. In normal course of his business, a Clearing Agent, files a bill based upon the document and information provided by the importer. He cannot be presumed to be a privy to any illegal arrangement, which the importer may have coined or had intended in his mind. For that purpose some evidence of his direct involvement will have to be brought on record. Particularly when it is not shown that the Clearing Agent was directly or indirectly a beneficiary of invasion of taxes. In the present case no attempt whatsoever was ever made to bring home guilt to the Clearing Agent. The appeal is accepted to the extend of Clearing Agent.". Nothing contrary to its prescribed duties were done by Messrs Al-Naseeb Traders, Karachi. (appellant No, 2). Resultant, invoking of section 32 of the Customs Act, 1969 and imposition of penalty was not warranted at all.
The issue No, (viii) is answered in negative.
17. That as regard to issue No, (ix), the re-assessment order dated 23.03.2013 by the subordinate of respondent No, 2 and order dated 17.12.2013 by the respondent No, 3 are not proper order with the application of mind instead these are non speaking orders based on beside mala fide and arbitrariness and this stood validated from the assessment note which read as "during monitoring, it was found that the benefit of sales tax is extended by the assessing officer, I put forward the cases of the same in the file to ADC on 11.03.2013, thus GD is re-assessed create recovery, the importer is directed to pay the amount". He created recovery without following the mandate of law and in derogation of section 80(2) and (3) and Section 32(3) of Customs Act, 1969. With usurpation of powers of the authority Notified vide SRO. 371(1)/2002 dated 15.06.2002. No reasoning whatsoever has been given that why the assessment orders passed by the appropriate officers were not correct and why mandate of law was not adhered. Likewise, the order of respondent No, 3 is silent to the fact that why pleas of the appellant taken in the reply dated 01.07.2013 to the show cause notice and additional arguments dated 16.11.2013 were not considered and rebutted despite direction of the FBR to adjudicating authorities issued vide letter No, C.No 730-M(L)/2002 dated 15.06.2002 and umpteenth reported judgment of the Superior Judicial Fora. Orders which did not contains rebuttal on the ground advanced and decision/judgments relied upon by the appellant and also not containing substantial reasons and did not shows that these were passed on objective consideration shall always be treated as illegal, void arbitrary and a result of misused of authority vested in public functionary. No room was available for such illegal void and arbitrary orders in any system of law. If any authority Court or Tribunal gave a finding of fact which was not based on material available on record was illegal arbitrarily without discussing and considering the material available on record it became perverse and a perverse finding of fact which is violative of the established principle of appreciation of evidence on record was not sustainable in law. The principle that every judicial or quasi-judicial finding should be based on reasons containing the justification for the finding in the order itself is an established principle of dispensation of justice. The Adjudication order is being violation of basic principle of the goods governance and mandatory requirement of section 24A of the General Clauses Act, is not only illegal and void but also not sustainable under law. The said position is also fortified by the judgments of Supreme Courts reported as 2005 YLR 1019, 2007 PTD 2500, 2004 PTD 1973, 2005 YLR 1719, 2003 PTD 777, 2003 PTD (Trib.) 2369, 2002 MLD 357, 1983. CLC 2882, 2005 PTD 2519, 2005 PTD 1189, 2003 PTD 2369, PLD 1995 SC (Pak) 272, PLD 1970 SC 158, PLD 1970 SC 173 1984 SCMR 1014 and 2012 PTD (Trib.) 619. The issue No, (ix) is answer in negative.
18. In view of the above narration, the whole proceeding are infested with inherent legal infirmities and substantive illegalities tantamount to patent violation of mandatory statutory provision and that too in utter disregard of the provision of the Acts/Ordinance and Principle of law settled by the Superior Judicial Fora. The chronicle even right from passing of reassessment order by the subordinate of respondent No,1 and issuance of show cause notice and order-in-original passed by respondent No, 3 are without power/jurisdiction hence abinitio void and as such corum non judice by virtue of the fact they ignored the provision of Acts/notification and the ratio settled by the Supreme Court of Pakistan in reported judgment PLD 1996 Karachi 68, 2006 PTD 978, PLD 1971 Supreme Court 184, PLD 2014 Supreme Court 600 PLD 2005 Supreme Court 842 that assuming of jurisdiction is of great importance and powers has to be exercised within the allotted sphere acting contrary is incurable rather fatal, super structure built thereupon has to crumble down.
19. To what have been stated/discussed and observed herein above, particularly the interpretation of law and legal preposition discussed in the light of prescribed law and observations made thereon and to follow the ratio decidendi in the judgment of the Superior Judicial Fora referred above and rule of consistency, I set aside the assessment orders dated 23.03.2013 and order-in- original dated 17.12.2013 as the same suffers from grave legal infirmities, therefore are declared to be illegal, null and void, after allowing the appeals as prayed. (i) consequent result of which is also that the respondent No, 2 should refund the amount of Rs,2,780,663.00 without calling for refund application as i,e, not required due to the fact that the said amount was not paid by the appellant under duress, despite not payable under Serial No, 15 of Table I to the Sales Tax Act, 1990 and in the absence of any order to the said effect and (ii) the Project Director WeBOC to restore the original feeding of Serial 15 of Table I in accordance with the Note-I to the Tables of Sixth Schedule to the Sales Tax Act, 1990 and for compliance the office is directed to forward copy of this order to him.
20. Orders passed accordingly with no cost.