SYED SARDAR HUSSAIN SHAH, MEMBER (JUDICIAL).--- This appeal has been filed by Muhammad Tahir son of Yar Jan (herein after called appellant) against the Order-in-Original No.39 of 2017, dated 25.01.2017, passed by -the Collector of Customs (Appeals) Islamabad, Camp Office, Jamrud Road, Custom House, Peshawar, whereby he set aside that order in original No. 240 of 2016, dated 01.06.2016 of the Deputy collector of Customs (Adjudication) Islamabad, Custom House, Jamrud Road, Peshawar.
2. Briefly stated facts of the case are that on 20.02.2016 at about 06:30 A.M, Custom staff of Airport, Peshawar checked the baggage of passengers through scanning machine and found suspected. Thorough examination of the baggage led to the recovery of foreign origin 50 Kgs of silver grains in 03 cotton bags. The appellant (Muhammad Tahir) arriving through International Flight No.QR 06000 from Doha Qatar to Peshawar only produced invoice, but failed to produce the requisite documents and foreign exchange for the import of silver grains. He further ensured to provide more relevant documents in this respect. Hence, the consignment of 03 bags silver grains 50 Kgs foreign origin as per invoice was detained on 20.02.2016 vide Detention Memo No.93/2016, 20.02.2016. The appellant despite lapse of 30 days, could not provide documents for lawful possession. The detained silver grains 50 Kgs as per invoice foreign origin was 'converted into seizure and seized on 21.03.2016 for violation of Sections 2(s), 16 and 139 of the Customs Act, 1969 read with Section 3(1) of the Imports and Exports (Control) Act, 1950 read with SRO.760(l)/2013; dated 02.09.2013, and provision of Serial No.16 of Part-II of Appendix-B Import Policy Order (IPO), Baggage Rules punishable under Section 156(1)(8)(9)(70)(89)(90) of the Customs Act, 1969 read with 3(1) of the Imports and Exports (Control) Act, 1950.
Notice under Section 171 of the Customs Act, 1969 and Recovery memo. were sent to the appellant on his given address by post vide Postal Receipt dated 21.03.2016 and dated 24.03.2016 respectively.
3. Subsequently, a Show-Cause notice was issued to the appellant on 08.04.2016. The Deputy Collector of Customs (Adjudication), Islamabad, Camp Office, Custom House, Peshawar vide Order-in-Original No.240/2016, dated 01.06.2016, released the seized Silver weighing 50 Kgs to the appellant on payment of leviable duties and taxes plus a redemption fine @ 20% of the customs value as per serial No.2(B) of SRO.499(I)/2009, 13.06.2009.
4. The respondents (then appellants) being aggrieved, filed an appeal before the Collector of Customs (Appeals), Islamabad, Camp Office, Custom House, Jamrud Road, Peshawar against the Order-inOriginal No.240/2016, dated 01.06.2016 of the Deputy Collector of Customs (Adjudication), who vide Order-in-Appeal No.39 of 2017 dated 25.01.2017, set aside the Order-in-Original No.240 of 2016, dated 01.06.2016. Hence the present appeal to this Tribunal filed by the appellant.
5. I have heard Mr. Muhammad Hayat Khan, learned counsel for the appellants as well as Mr. Muhammad Zahid, Superintendent, Departmental Representative for the respondents and gone through the record of the case.
6. In this case the appellant has been charged for smuggling under Section 2(s) of the Customs Act, which defined that not only the act of bringing in or taking out of Pakistan any goods in breach of any prohibition or restriction or evading payment of customs duties and taxes, but any attempt to do so also constitutes smuggling. Clause (iii) of Section 2(s) of the Customs Act, 1969, envisaged that "any goods by any route other than a route declared under Section 9 or 10 or from any place other than a Customs Station" shall be subjected to smuggling. The appellant has not violated Clause (iii) of Section 2(s). The subject goods were brought through an authorized route. The appellant requested to the Customs authorities that as the goods were brought through an authorized route, and he may be allowed to clear it on payment of all duties and taxes. The seizing agency was assured and thus not seized the goods on the spot, perusal of the Detention Memo shows that the gold has been detained for want of duties and taxes. Furthermore, the seizing agency did not seize the gold under Section 168 of the Customs Act, 1969, neither served a Notice under Section 171 of the Customs Act, 1969, rather issued a Detention Memo, wherein one month time was given for payment of duties and taxes for clearing the detained goods. The Detention Memo further disclosed that in case of failure of the appellant the goods shall be disposed up under Section 82 of the Customs Act, 1969. Section 82 is reproduced as under:-
82. Procedure in case of goods not cleared or warehoused or transshipped or exported or removed from the. port within twenty days after unloading or filing of declaration.---If any goods are not cleared for home- consumption or warehoused or transshipped or are not loaded on the conveyance for export or removed from the port area within twenty days of their arrival at a customs station or within such extended period not exceeding ten days, an officer not below the rank of Assistant Collector may allow, and such goods may, after the due notice given to the owner if his address could be ascertained, or after due notice to the carrier, shipping or customs agent, custodian of the goods, as the case may be, if his address could not be ascertained, may be sold in auction or taken into custody by Customs and removed from the port to a Customs warehouse for auction under the order of the Assistant Collector notwithstanding the fact that adjudication of the case under section 179, or an appeal under section 193, or 196, or a proceeding in any court is pending: Provided that?
(a) animals and perishable and hazardous goods may, with the permission of the appropriate officer, be sold or destroyed at any time;
(b) arms, ammunition or military stores may be sold or otherwise disposed of at such time and place and in such manner as the Board may, with the approval of the Federal Government, direct;
(c) in cases where goods are sold pending adjudication, appeal or decision of the court, the proceeds of sale shall be kept in deposit and if on such adjudication, or as the case may be, in such appeal or the decision of the court, the goods sold are found not to have been liable to confiscation, the entire sale proceeds, after necessary deduction of duties, taxes transportation and other charges or duties as provided in section 201, shall be handed over to the owner: Provided further that where Customs removes such goods from the premises of the custodian for disposal, the charges due to the custodian shall be paid subsequently from the sale proceeds of the goods in the manner as provided under section 201: Provided also that nothing in this section shall authorize removal for home consumption of any dutiable goods without payment of customs duties thereon. he was not singled out, but his baggage was selected for scanning among baggage of other passengers. In this case the legal requirements as envisaged in the above stated Section 82 of law has not been adopted.
7. It is evident from the Detention Memo. available on page No.29 of the file, wherein statement of the appellant was recorded that Silver may be detained till arrangement of amount of duties and taxes. At that time it was not possible for the appellant to pay the duties and taxes. Statement of the Seizing officer endorsed on the Detention Memo.is clear that "for want of customs duty and taxes". The appellant was not intercepted when he was crossing green channel in a bit to avoid declaring his baggage, but he produced an invoice showing purchase of the Silver abroad.
8. Departmental Representative of the respondents referred to SRO.760(I)/2013, dated 02.09.2013, wherein the import of gold and Silver is subject to certain conditions i.e. the importer must be registered with the Trade Development Authority of Pakistan (TDAP) for import authorization, he has to re-export the imported gold and silver after converting them into jewellery as per the contract with foreign buyer.
9. Counsel for the appellant argued that his case falls under Serial No.16 of the Appendix-B of the IPO, 2013 and not under the SRO.760(I)/2013, dated 02.09.2013. Perusal of SRO.760(I)/2013, dated 02.09.2013 reveals that it does not contain any such clause made on everyone importing gold or any Silver to follow this notification only, those who were registered with TDAP and want to re-export the metal in the form of jewellery avail this notification under the scheme called the Entrustment Scheme. The appellant was willing to pay all duties and taxes on the Silver and its subsequent consumption in Pakistan after import. The attraction of the aforementioned SRO does not arise.
10. The appellant was given Detention Memo instead of notice under Section 171, wherein reason for detention was indicated as want of duties and taxes. This has rightfully been discussed by the learned Deputy. Collector of Customs (Adjudication), Islamabad Camp Office, Custom House, Peshawar in his ONO dated 01.06.2016, and there is nothing on file to question the appellant by the Customs authorities to prove legality of his goods at the time of import. The case of the prosecution is that the appellant had not paid duties and taxes at the time of his arrival.
11. In view of the above discussion, I allow this appeal, set aside the Order-in-Appeal No.39 of 2017, dated 25.01.2017 of the Collector of. Customs (Appeals), Islamabad, Camp Office, Custom House, Jamrud Road, Peshawar and uphold Order-in-Original No.240 of 2016, dated 01.06.2016, of the Deputy Collector of Customs (Adjudication) Islamabad, Camp Office, Custom House, Peshawar. This case is disposed of accordingly.